Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows: (a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing. (b) Borrower does not own and will not own any asset or property other than (i) the Properties, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the Properties. (c) Borrower will not engage in any business other than the ownership, management and operation of the Properties. (d) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “Related Parties”), except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Person. (e) Borrower has not incurred and will not incur any Indebtedness other than (i) the Loan and (ii) trade payables in the ordinary course of business with trade creditors in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, and is not in excess of sixty (60) days past due. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the Properties. (f) Borrower has not made and will not make any loans or advances to any Person and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents). (g) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due. (h) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party without the prior written consent of Lender. (i) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposes. (j) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person (including any Affiliate or other Related Party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks. (k) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower. (l) Neither Borrower nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower. (m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name. (n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person. (o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded. (p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 3 contracts
Sources: Loan Agreement (U-Store-It Trust), Loan Agreement (U-Store-It Trust), Loan Agreement (U-Store-It Trust)
Single Purpose Entity/Separateness. Borrower represents, ---------------------------------- warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the Properties, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the Properties.
(cb) Borrower will not engage in any business other than the ownership, management and operation of the PropertiesProperties and Borrower will conduct and operate its business as presently conducted and operated.
(dc) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower Guarantor or any Affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower has not incurred and will not incur any Indebtedness Indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan Debt and (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in except pursuant to the aggregate, Guaranty of Payment and is not in excess of sixty (60) days past duethe Cash Management Agreement. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) ---- ----- by the Properties, except pursuant to the Junior Mortgage.
(fe) Borrower has not made and will not make any loans or advances to any Person third party (including any Affiliate or constituent party, any Guarantor or any Affiliate of any constituent party or Guarantor), except pursuant to the Guaranty of Payment or as provided in the Cash Management Agreement, and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)its Affiliates.
(gf) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, SPC Entity to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, certificate of organization, trust or other organizational documents of Borrower or such Related Party SPC Entity in any manner that would affect the status of Borrower or such SPC Entity as a single- purpose, bankruptcy-remote entity, without (i) the prior written consent of Lender, in its sole discretion and, (ii) if a Securitization has occurred, delivery to Lender of a No Downgrade Letter.
(ih) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, (provided that Borrower’s 's financial statements and tax returns may be prepared on a consolidated basis with other entities provided that such consolidated financial statements and tax returns indicate the separate existence of Borrower and its assets and income may be included in a consolidated tax return of liabilities). Borrower shall maintain its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated books, records, resolutions and agreements as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate of Borrower, any constituent party of Borrower, any Guarantor or other Related Partyany Affiliate of any constituent party or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(kj) Borrower is adequately capitalized and will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower nor any Related Party will shall not seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or of Borrower.
(l) Borrower will not commingle the sale of material funds and other assets of BorrowerBorrower with those of any Affiliate or constituent party, any Guarantor, or any Affiliate of any constituent party or Guarantor, or any other Person.
(m) Borrower has and will maintain its assets in such a manner that it will not commingle be costly or difficult to segregate, ascertain or identify its individual assets with from those of any Affiliate or constituent party, any Guarantor, or any Affiliate of any constituent party or Guarantor, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own namePerson.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not guarantee, become obligated for, pledge its assets as security for, or hold itself out as being to be responsible for the debts or obligations of any other Person or the decisions or actions respecting the daily business or affairs of any other Person, except pursuant to the Guaranty of Payment.
(o) Unless If Borrower is a single member limited partnership or a limited liability company formed under company, the laws of general partner or managing member (the State of Delaware, Borrower "SPC ENTITY") shall require that be a Person holding an corporation whose sole asset is its interest in Borrower be a corporation or limited liability company (and the “SPC Party”) which Entity will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 3.1.40 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedEntity.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members member of the board of directors (an "INDEPENDENT DIRECTOR") of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender Entity who shall not have been at the time of each such individual’s respective 's appointment, and shall not be at any time while serving as a Independent Director director of the SPC Entity and may has not have been at any time during the preceding five (5) years (i) a shareholder of, or an officer, directordirector (with the exception of serving as the Independent Director of the SPC Entity), attorney, counsel, partner or employee of, Borrower Borrower, the SPC Entity or any Affiliate of its or their shareholders, subsidiaries or Affiliateseither of them, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or Borrower, the SPC Party (if applicable) Entity or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliatesthem, (iii) a Person controlling or under common control with any such shareholder, partner partner, supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer customer. As used herein, the term "control" means the possession, directly or indirectly, of any other director the power to direct or cause the direction of Borrower the management policies or the SPC Party (if applicable)activities of a Person, whether through ownership of voting securities, by contract or otherwise. Notwithstanding the foregoing, (1) an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director of the SPC Entity if such individual is individual, at or prior to the time of initial appointment, or at any time while serving as an Independent DirectorDirector of the SPC Entity, (i) is an independent director Independent Director of a “"special purpose entity” " affiliated with Borrower. As used in the Borrower or the SPC Entity (for purposes of this clause (p)paragraph, the term “a "special purpose entity” shall mean " is an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve the Borrower's and the SPC Entity's separateness that are substantially similar to those of the Borrower or the SPC Entity, as applicable, and provideprovided, inter alia, that it: it (a) is organized for a the limited purposepurpose of owning and operating one or more properties or being an owner of one or more other entities that are so organized; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition on its own behalf or on behalf of an entity in which it has an ownership interest without the consent of its independent managers or independent directors director; and (d) shall conduct itself and cause any entity in which it has an ownership interest to conduct itself in accordance with certain “"separateness covenants”, ," including, but not limited to, the maintenance of its and such entity's books, records, bank accounts and assets separate from those of any other Personperson or entity), (ii) makes retail purchases of vehicles from dealerships that are affiliates of the SPC Entity or Borrower, or (iii) is employed by a company that provides independent director services to corporations, which company (either directly or through an affiliated entity) provides corporate registration or other services to the SPC Entity, the Borrower or any affiliate of either of them, and (2) the SPC Entity shall be entitled to pay reasonable fees to the Independent Director for his or her services as a director of the SPC Entity.
Appears in 3 contracts
Sources: Loan Agreement (Capital Automotive Reit), Loan Agreement (Capital Automotive Reit), Loan Agreement (Capital Automotive Reit)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is has not and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the Properties, Property and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesProperty.
(cb) Borrower will has not engaged and shall not engage in any business or activity other than the ownership, management and operation of the PropertiesProperty, and Borrower will conduct and operate its business as presently conducted and operated.
(dc) Borrower will has not and shall not enter into or be a party to any transaction, contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors guarantor of the Debt or any part thereof, or of any recourse obligations of Borrower or any Affiliate of recourse carveouts (each a “Guarantor”) or any constituent partyparty which is directly or indirectly controlling, owner controlled by or guarantor under common control with Borrower or Guarantor (collectively, the an “Related PartiesAffiliate”), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an armsarm’s-length basis with third parties not so affiliated with Borrower other than any Guarantor or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other PersonAffiliate.
(ed) Borrower has not incurred and will shall not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan Debt and (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors in connection with owning, operating and maintaining the Property, in such amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, promissory note or other debt instrument and is not at any time in an aggregate amount in excess of sixty two percent (602%) of the original loan amount evidenced by the Note, and further provided that all such trade debts are paid within thirty (30) days past dueafter the same are incurred. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesProperty unless approved by Lender in its sole and absolute discretion.
(fe) Borrower has not made and will shall not make any loans or advances to any Person and shall not acquire obligations or securities of third party, nor to Guarantor, any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties Affiliate or any other Person constituent party of Borrower (except that regular distributions made to equity owners of Borrower may invest in those investments permitted under the Loan Documents)ordinary course of business.
(gf) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower has done or caused to be done and will shall do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, declaration of trust or other organizational documents of Borrower or such Related Party Guarantor in a manner which would adversely affect Borrower’s existence as a single-purpose entity, without the prior written consent of Lender.
(ih) Borrower will has maintained and shall maintain all financial statements, accounting records, books and records, bank accounts and other entity documents separate from those of its Affiliates and any constituent party of Borrower or any other person or entity, and Borrower has filed and shall file its own tax returns which shall be in the form of a consolidated tax return with Guarantor in which Borrower’s financial statements shall be clearly evidenced. Borrower has maintained and shall maintain its books, records, financial statements resolutions and bank accounts separate from those of any other Person and Borrower’s assets will not be listed agreements as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower has been and will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate Affiliate, any constituent party of Borrower or other Related Partyany Guarantor), . Borrower has corrected and shall correct any known misunderstanding regarding its status as a separate entity, . Borrower has conducted and shall conduct business in its own name, . Borrower has not and shall not identify itself or any of its Affiliates as a division or part of the other other. Borrower has maintained and shall maintain and utilize a separate telephone number and separate stationery, invoices and checks. Borrower has allocated and shall allocate fairly and reasonably any overhead for shared office space.
(j) Borrower has preserved and kept and shall preserve and keep in full force and effect its existence and good standing in the state in which Borrower is organized and its qualification to do business in the state in which the Property is located, and Borrower has observed and will observe all partnership, corporate or limited liability company formalities, as applicable.
(k) Borrower will has maintained and shall maintain adequate capital and a sufficient number of employees for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations. Borrower will pay the salaries of its own employees, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrowerif any.
(l) Neither Borrower nor any Related Party will constituent party of Borrower has sought or shall seek or consent to the dissolution, dissolution or winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower, nor will Borrower merge with or be consolidated into any other entity or acquire by purchase or otherwise all or substantially all of the business assets of, or any stock or beneficial ownership in, any entity.
(m) Borrower will has not and shall not commingle its the funds and other assets of Borrower with those of any Affiliate, any Guarantor, any constituent party of Borrower or any other Person person, and Borrower will hold all pay its own liabilities out of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameand assets.
(n) Borrower has maintained and shall maintain its assets in such a manner that it will not guarantee be costly or difficult to segregate, ascertain or identify its individual assets from those of any constituent party of Borrower, Affiliate, Guarantor or any other person.
(o) Borrower has not and shall not assume, guarantee, become obligated for the debts of any other Person and does not and will not or hold itself out as being to be responsible for the debts or obligations of any other Personperson (provided, that the foregoing shall not prevent Borrower from being obligated for and holding itself responsible for expenses incurred or obligations undertaken by the property manager of the Property in respect of its duties regarding the Property).
(op) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require obtain and maintain in full force and effect, and abide by and satisfy the material terms and conditions of, all material permits, licenses, registrations and other authorizations with or granted by any governmental authorities that a Person holding may be required from time to time with respect to the performance of its obligations under this Mortgage.
(q) Borrower does not and shall not own any subsidiary. Borrower has not made and shall not make any investment in any person or entity.
(r) Borrower has not and shall not, without the unanimous consent of all its general partners, directors or members, as applicable, (i) file or consent to the filing of any petition, either voluntary or involuntary, to avail itself of any applicable insolvency, bankruptcy, liquidation or reorganization statute or (ii) make an interest in assignment for the benefit of creditors.
(s) Borrower shall be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware with one (1) member (the “Single Member”), and the organizational documents Borrower’s certificate of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party formation and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party operating agreement (“Borrower’s Organizational Documents”) shall be disregardedin form and substance reasonably satisfactory to Lender.
(pt) Borrower’s Organizational Documents shall contain each of the representations, covenants and warranties set forth in this Section 9 and shall require Borrower shall to at all times cause there to be at least one (1) duly appointed members independent manager or independent member of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender of Borrower who shall be an individual, natural person and whose vote will be required in connection with the voluntary filing for protection under the Bankruptcy Code or similar action by Borrower and who is not have been at the time of each such individual’s respective initial appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) years, a shareholder of, or an officer, director, partner partner, paid consultant or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliatesaffiliates, (ii) a customer of, or supplier to, Borrower or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliatesaffiliates, (iii) or a Person person or other entity controlling or under common control with any such shareholder, partner partner, supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p)herein, the term “special purpose control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person or entity” , whether through ownership of voting securities, by contract or otherwise. Borrower’s Organizational Documents shall mean further require that upon the occurrence of any event that causes the Single Member to cease to be a member in Borrower, the Independent Director shall, without action of any person and simultaneously with the Single Member ceasing to be a member of Borrower, automatically be admitted to Borrower as a member and shall continue Borrower without dissolution.
(u) Borrower shall cause reputable Delaware counsel reasonably acceptable to Lender (the “Law Firm”) to deliver to Lender an entity whose opinion letter reasonably satisfactory to Lender whereby the Law Firm opines (which opinion may be subject to standard assumptions, qualifications, limitations and exceptions reasonably acceptable to Lender), among other requirements of Lender, that: (1) the unanimous consent of Single Member and the Independent Director is required in order for Borrower to file a voluntary bankruptcy petition; (2) the provision in Borrower’s organizational documents contain restrictions on its activities and impose requirements intended that requires unanimous consent as a condition to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) filing a voluntary bankruptcy petition is organized for a limited purposeenforceable against Single Member; (b3) has restrictions on its ability the bankruptcy of Single Member will not cause Borrower to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assetsbe dissolved; (c4) may no creditor of Single Member shall have the right to obtain possession of, or otherwise exercise legal or equitable remedies with respect to, Borrower’s property; and (5) Delaware law, not federal law, governs the determination of what persons or entities have the authority to file voluntarily a voluntary bankruptcy petition without the consent on behalf of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other PersonBorrower.
Appears in 2 contracts
Sources: Deed of Trust and Security Agreement (Infousa Inc), Deed of Trust and Security Agreement (Infousa Inc)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owninghas not owned, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own own, and will not own any asset or property other than (i) the PropertiesProject, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesProject.
(cb) Borrower has not engaged in and will not engage in any business other than the ownership, management and operation of the PropertiesProject.
(dc) Borrower has not entered into and will not enter into any contract or agreement with any Affiliate of the Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “Related Parties”), except upon terms and conditions that have been, are and shall be intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower has not incurred and will not incur any Indebtedness Debt other than (i) the Loan and Loan, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregatenote and is paid when due, and is not (iii) Debt incurred in excess purchase-money financing of sixty (60) days past dueequipment and other personal property used on the Project. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passu) by the PropertiesProject; provided, that, debt incurred pursuant to (iii) above may be secured by the equipment and other personal property being purchased.
(fe) Borrower has not made and will not make any loans or advances to any Person third party (including any affiliate or constituent party or any affiliate of any constituent party), and has not and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party.
(gf) Borrower has been, is and will remain solvent and Borrower has paid, and will pay pay, its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own funds and assets only, as the same have become due and as the same shall become due.
(hg) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, manager or other Person in control of Borrower to amend, modify or otherwise change any provision of the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or any manager or other Person in control of Borrower in a manner which adversely affects Borrower’s or such Related Party manager’s or other Person’s existence as a single purpose entity without the prior written consent of Lender.
(ih) Borrower has maintained, and will maintain maintain, all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; providedreturns. Borrower shall maintain its books, howeverrecords, that Borrower’s assets resolutions and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated agreements as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower has been and will be, and at all times has held itself out and will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate of Borrower, any constituent party of Borrower, or other Related Partyany Affiliate of any constituent party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other provided, that, Borrower may contract with any property manager for the Project for (i) the rights under a nonexclusive license authorizing Borrower to use various service marks, trademarks, and trade names (e.g. “The Grove,” “Go Grove,” and “Campus Crest”) for purposes of marketing the Project to prospective tenants, (ii) the use by such property manager of such licensed service marks, trademarks and trade names on behalf of Borrower for purposes of marketing the Project to potential tenants, and (iii) space on a nonexclusive website which advertises the Project to potential tenants along with other properties managed by such property manager that are also licensed to use such service marks, trademarks and trade names, and shall maintain and utilize a separate telephone number, if any, and separate stationery, invoices and checkschecks provided, that, the foregoing shall not limit the ability of any property manager under a management agreement acting on behalf of Borrower to use such manager’s own stationery and invoices so long as, in matters affecting legal rights and obligations of Borrower or the Project, such manager shall identify its representative capacity of Borrower and/or the Project so as to avoid any misunderstanding of Borrower’s separate identity.
(kj) Borrower has maintained, and will maintain maintain, adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or of the sale of material Borrower.
(l) Borrower has not commingled and will not commingle the funds and other assets of BorrowerBorrower with those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other person.
(m) Borrower has and will maintain its assets in such a manner that it will not commingle be costly or difficult to segregate, ascertain or identify its individual assets with from those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameperson.
(n) Borrower will not guarantee or become obligated for the debts of any other Person has not, and Borrower does not and will not hold itself out as being to be responsible for the debts or obligations of any other Personperson.
(o) Unless If Borrower is a single member limited partnership or a limited liability company formed under the laws of the State of Delawarecompany, Borrower each general partner or managing member (each, an “SPC Party”) shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “whose sole asset is its interest in Borrower and each such SPC Party”) which Party will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 6.14 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedParty.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 2 contracts
Sources: Loan Agreement (Campus Crest Communities, Inc.), Loan Agreement (Campus Crest Communities, Inc.)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owninghas not owned, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own own, and will not own any asset or property other than (i) the PropertiesProjects, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesProjects.
(cb) Borrower will not engage in any business other than the ownership, management and operation of the PropertiesProjects and Borrower will conduct and operate its business as presently conducted and operated.
(dc) Borrower will not enter into any contract or agreement with any Affiliate of the Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “Related Parties”), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower has not incurred and will not incur any Indebtedness Debt other than (i) the Loan and Loan, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a notenote and is paid when due, does not exceed $4,000,000.00 and (iii) Debt incurred in the aggregate, financing of equipment and is not in excess of sixty (60) days past dueother personal property used on the Projects. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passu) by the Propertiesany Project.
(fe) Borrower has not made and will not make any loans or advances to any Person third party (including any Affiliate or constituent party or any Affiliate of any constituent party), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its Affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party.
(gf) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own funds and assets only, and as the same shall become due.
(hg) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, constituent party to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party constituent party without the prior written consent of Lender.
(ih) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns returns, if any, as may be required under applicable law, to the extent not part of a consolidated group filing a consolidated return, and pay any taxes so required by to be paid under applicable law; provided. Borrower shall maintain its books, howeverrecords, that Borrower’s assets resolutions and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated agreements as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate of Borrower, any constituent party of Borrower, or other Related Partyany Affiliate of any constituent party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize a separate telephone number, if any, and separate stationery, invoices and checks.
(kj) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or of the sale of material Borrower.
(l) Borrower will not commingle the funds and other assets of BorrowerBorrower with those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other Person.
(m) Borrower has and will maintain its assets in such a manner that it will not commingle be costly or difficult to segregate, ascertain or identify its individual assets with from those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own namePerson.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being to be responsible for the debts or obligations of any other Person.
(o) Unless If Borrower is a single member limited partnership or a limited liability company formed under the laws of the State of Delawarecompany, Borrower shall require that a Person holding each general partner or managing member (each, an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which shall be a limited liability company whose sole asset is its interest in Borrower and each such SPC Party will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 6.14 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedParty.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers special manager (an “Independent Director”) reasonably satisfactory to Lender of each SPC Party in Borrower who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.the
Appears in 2 contracts
Sources: Loan Agreement (Extra Space Storage Inc.), Loan Agreement (Extra Space Storage Inc.)
Single Purpose Entity/Separateness. Borrower Trustor represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Trustor does not own and will not own any asset or property other than (i) the PropertiesTrust Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesTrust Property.
(cb) Borrower Trustor will not engage in any business other than the ownership, management and operation of the PropertiesTrust Property and Trustor will conduct and operate its business as presently conducted and operated.
(dc) Borrower Trustor will not enter into any contract or agreement with any Affiliate affiliate of Borrowerthe Trustor, any constituent party of BorrowerTrustor, any guarantors guarantor (a "GUARANTOR" of the obligations of Borrower Debt or any Affiliate part thereof or any affiliate of any constituent party, owner parry or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or panics other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower Trustor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and Debt, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such and (iii) debt is not evidenced by a note, does not exceed $4,000,000.00 incurred in the aggregate, financing of equipment and is not in excess of sixty (60) days past dueother personal property used on the Premises. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesTrust Property.
(fe) Borrower Trustor has not made and will not make any loans or advances to any Person third party (including any affiliate or constituent party, any Guarantor or any affiliate of any constituent party or Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)its affiliates.
(gf) Borrower Trustor is and will remain solvent and Borrower Trustor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower Trustor has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower Trustor will not, nor will Borrower Trustor permit any Related Party to, constituent party or Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, certificate of organization, trust or other organizational documents of Borrower Trustor or such Related Party constituent party or Guarantor without the prior written consent of LenderBeneficiary.
(ih) Borrower Trustor will maintain all of its books, records, financial statements and bank accounts separate from those of its affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower Trustor will file its own tax returns to the extent unless required otherwise by applicable law; provided. Trustor shall maintain its books, howeverrecords, that Borrower’s assets resolutions and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated agreements as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower Trustor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate affiliate of Trustor, any constituent party of Trustor, any Guarantor or other Related Partyany affiliate of any constituent party or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates affiliates as a division or part of the other and shall maintain and utilize a separate telephone number and separate stationery, invoices and checks.
(kj) Borrower Trustor is adequately capitalized and will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower Trustor nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or of the sale of material assets of BorrowerTrustor.
(m1) Borrower Trustor will not commingle its the funds and other assets of Trustor with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accountsaffiliate or constituent party, savings accountsany Guarantor, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts any affiliate of any other Person and does not and will not hold itself out as being responsible for the debts constituent party of Guarantor, or obligations of any other Personperson.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 2 contracts
Sources: Deed of Trust, Assignment of Leases and Rents and Security Agreement (First Potomac Realty Trust), Deed of Trust, Assignment of Leases and Rents and Security Agreement (First Potomac Realty Trust)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the PropertiesProperty, (ii) entering into this Loan Agreement with Lender, (iii) refinancing the Properties Property in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the PropertiesProperty, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesProperty.
(c) Borrower will not engage in any business other than the ownership, management and operation of the PropertiesProperty.
(d) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any owner of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “"Related Parties”"), except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an armsarm's-length basis with third parties not so affiliated with Borrower or such Related Parties. Borrower will maintain an arm’s length relationship with such Lender acknowledges that Related Parties or any other Personhave executed the Management Agreement.
(e) Borrower has not incurred and will not incur any Indebtedness other than (i) the Loan and Loan; (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, note and is not in excess of sixty (60) days past duedue and is not in excess of $1,000,000 in the aggregate; (iii) personal property financing not in excess of $1,000,000 in the aggregate; and (iv) personal property leases providing for rental payments not in excess of $500,000 per annum. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesProperty.
(f) Borrower has not made and will not make any loans or advances to any Person and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents).
(g) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party without the prior written consent of Lender.
(i) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person and Borrower’s 's assets will not be listed as assets on the financial statement of any other Person except as otherwise Person; provided, however, that Borrower's assets may be included in a consolidated financial statement of a real estate investment trust (a "REIT") if inclusion on such a consolidated statement is required in accordance to comply with the requirements of GAAP. Borrower will file its own tax returns to the extent required by applicable lawand will not file a consolidated federal income tax return with any other Person; provided, however, that Borrower’s assets and income if such Person is a corporation wholly owned by a REIT, such entity may be included in a consolidated federal income tax return of its parent companies the REIT if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated the Internal Revenue Service. Borrower shall maintain its books, records, resolutions and agreements as a disregarded entity for Federal income tax purposesofficial records.
(j) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person (including any Affiliate or other Related Party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other name and shall maintain and utilize separate stationery, invoices and checks.
(k) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower.
(m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.;
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless If Borrower is a limited partnership or a limited liability company (other than an approved single member limited liability company formed under the laws of the State of Delawarecompany), at least one general partner or member, or if Borrower is a general partnership at least two general partners (each, an "SPC Party") shall require that be a Person holding an corporation whose sole asset is its interest in Borrower be a corporation or limited liability company (the “and each such SPC Party”) which Party will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such PersonSPC Party. The structure of Borrower and Upon the interest withdrawal or the disassociation of the SPC Party from Borrower, Borrower shall immediately appoint a new member or general partner whose articles of incorporation are substantially similar to those of the SPC Party and deliver a new Insolvency Opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners. Notwithstanding anything to the contrary in this Agreement, in no event shall the Property be transferred to any entity other than a corporation, limited partnership or limited liability company.
(p) if Borrower is an approved single member limited liability company, Borrower shall be reasonably a Delaware limited liability company that has at least (x) two (2) springing members who are individuals acceptable to Lender and who shall satisfy the requirements automatically become members of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under having a 0% economic interest therein upon the laws occurrence of any event which would cause the sole member of the State limited liability company to cease to be a member thereof, and (y) two (2) duly appointed Independent Directors (as hereinafter defined) as directors or managers who may also be springing members, and has not caused or allowed and will not cause or allow the directors or managers of Delaware and such entity to take any action requiring the organizational documents unanimous affirmative vote of Borrower as delivered to Lender one hundred percent (100%) of the members of its board of directors or its managers unless both Independent Directors shall have participated in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.such vote;
(pq) Borrower shall at all times cause there to be at least one two (12) duly appointed members of the board of directors (an "Independent Director") of the Borrower (if a corporation) or of each SPC Party or (if Borrower is a single member Delaware limited partnership or a limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall is provided by a nationally recognized company that provides professional independent directors and is not have been at the time of each such individual’s respective appointment, initial appointment and shall has not be at any time while serving as a Independent Director and may not have been at any time during the preceding five (5) years and shall not be while serving as an Independent Director: (i) a shareholder ofstockholder, director (other than as an Independent Director of Borrower or an of a special purpose corporation affiliated with Borrower), officer, directoremployee, partner partner, attorney or employee of, counsel of Borrower or such SPC Party or any Affiliate of its or their shareholders, subsidiaries or Affiliates, either of them; (ii) a customer ofcreditor, customer, supplier or supplier to, or other Person who derives any of its purchases or revenues (other than any fees derived from the performance of standard corporate representative services) from its activities with Borrower or such SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, them; (iii) a Person controlling or under common control with any such shareholderstockholder, partner partner, creditor, customer, supplier or customer, other Person; or (iv) a member of the immediate family of any such shareholderstockholder, director, officer, directoremployee, partner, employeecreditor, customer, supplier or customer other Person. (As used herein, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwise.)
(r) Borrower shall not (and Borrower shall not cause or permit the board of directors of an SPC Party) to take any action which, under the terms of any other director applicable organizational document, requires the vote of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is Directors unless at the time of initial appointment, or such action there shall be at least two members who are Independent Directors.
(s) Borrower shall allocate fairly and reasonably any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness overhead expenses that are substantially similar to those shared with an Affiliate, including paying for office space and services performed by any employee of an Affiliate or Related Party.
(t) Borrower and provide, inter alia, that it: (a) is organized shall not pledge its assets for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those benefit of any other PersonPerson other than with respect to the Loan.
(u) Borrower shall maintain a sufficient number of employees in light of its contemplated business operations and pay the salaries of its own employees from its own funds.
(v) Borrower shall provide in its (i) operating agreement, if it is a limited liability company, (ii) limited partnership agreement, if it is a limited partnership or (iii) certificate of incorporation, if it is a corporation, that for so long as the Loan is outstanding pursuant to the Note, this Agreement and the other Loan Documents, it shall not file or consent to the filing of any petition, either voluntary or involuntary, to take advantage of any applicable insolvency, bankruptcy, liquidation or reorganization statute, or make an assignment for the benefit of creditors without the affirmative vote of each of the Independent Directors and of all other general partners/managing members/directors.
(w) Borrower shall conduct its business so that the assumptions made with respect to Borrower in the Insolvency Opinion shall be true and correct in all respects.
Appears in 2 contracts
Sources: Loan Agreement (Glimcher Realty Trust), Loan Agreement (Glimcher Realty Trust)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the Properties, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the Properties.
(c) Borrower will not engage in any business other than the ownership, management management, leasing and operation of the PropertiesProperty and Borrower will conduct and operate its business as presently conducted and operated.
(db) Borrower will not enter into any contract or agreement with any Affiliate affiliate of Borrower, any constituent party of Borrower, the holder of any guarantors partnership or membership interest, any manager or the owner of the obligations of any beneficial interest in Borrower (each, a "Beneficial Owner") or any Affiliate affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Beneficial Owner, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(e) Borrower has not incurred and will not incur any Indebtedness other than (i) the Loan and (ii) trade payables in the ordinary course of business with trade creditors in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, and is not in excess of sixty (60) days past due. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the Properties.
(f) Borrower has not made and will not make any loans or advances to any Person and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents).
(g) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hc) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existenceexistence including, without limitation, the holding of such annual and other meetings as are required by Borrower's organizational documents, and Borrower will not, nor will Borrower permit any Related Party to, constituent party or Beneficial Owner to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust certificate and agreement or other organizational documents of Borrower or such Related Party constituent party or Beneficial Owner, if such amendments would violate any provision of the Project Loan Documents, without the prior written consent of Lender, which consent shall not be unreasonably withheld, nor will Borrower permit any constituent party or Beneficial Owner to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, trust certificate and agreement or other organizational documents of such constituent party or Beneficial Owner, if such amendment, modification or change (i) would adversely affect the bankruptcy remote nature of Borrower; or (ii) would adversely affect Lender's interest in the Project Loan. Borrower shall deliver copies of minutes of annual meetings of Borrower to Lender within thirty (30) days of its receipt of written request therefor.
(id) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent where required by applicable law; providedcode or regulation. Borrower shall maintain its books, howeverrecords, that Borrower’s assets resolutions and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated agreements as a disregarded entity for Federal income tax purposesofficial records.
(je) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate of Borrower, any constituent party of Borrower, any Beneficial Owner or other Related Partyany Affiliate of any constituent party), and shall conduct business in its own name and shall maintain and utilize separate stationery, invoices and checks. Borrower shall correct any known or unknown misunderstanding regarding its status as a separate entity, shall conduct business in its own name, entity and shall not identify itself as a division or part of its Affiliates or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checksBorrower.
(kf) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lg) Neither Borrower nor any Related Party constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger merger, in whole or in part, of Borrower or the sale of material assets all or substantially all of Borrower's or any constituent party's assets.
(mh) Borrower will not commingle its the funds and other assets of Borrower with those of any affiliate or constituent party, any Beneficial Owner, or any affiliate of any constituent party or Beneficial Owner, or any other Person Person.
(i) Borrower has and will hold all of maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its own name. Borrower will deposit all individual assets from those of its funds in checking accountsany affiliate or constituent party, savings accountsany Beneficial Owner, time deposits or certificate deposits in its own name any affiliate of any constituent party or invest such funds in its own nameBeneficial Owner, or any other Person.
(nj) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being to be responsible for the debts or obligations of any other Person.
(ok) Unless If Borrower is a single member limited liability company, partnership or business trust, at least one manager, managing partner, general partner or trustee (the "SPC Member") of Borrower shall itself be a limited liability company formed under or corporation the laws sole asset of the State of Delaware, Borrower shall require that a Person holding an which is its interest in Borrower be a corporation and which at all times has as one of its members or limited liability company (directors an individual who qualifies as an Independent Director, the “SPC Party”) which SPE Member will at all times comply, and will cause Borrower to comply, comply with each of the representations, warranties, and covenants contained in this Section 4.1.30 5.12 as if such representation, warranty or covenant was made were made, mutatis mutandis, directly by such Person. The structure of Borrower SPC Member, the SPC Member and the interest Beneficial Owner shall cause Borrower at all times to comply with each of the SPC Party shall be reasonably acceptable to Lender representations, warranties, and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender covenants contained in connection with the Closing are not modified, this Section 5.12.
(l) Borrower shall not be required cause or permit the board of directors of Borrower or the SPC Member, as applicable, to have an SPC Party and all provisions take any action which, under the terms of this Agreement and any certificate of incorporation, by-laws, operating agreement or any voting trust agreement with respect to any common stock, requires the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members unanimous vote of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its the general partners or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director members of Borrower or the SPC Party (if Member, as applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is unless at the time of initial appointmentsuch action there shall be at least one member of the board of directors of Borrower or the SPC Member, or at any time while serving as applicable, who is an Independent Director.
(m) Borrower has not incurred and will not incur any indebtedness, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause secured or unsecured, direct or indirect, absolute or contingent (pincluding guaranteeing any obligation), other than (i) the term “special purpose entity” Project Loan or (ii) unsecured trade debt customarily payable within thirty (30) days. Borrower shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended deliver a certificate to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: Lender within thirty (a30) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, days upon written request from Lender but not limited tomore frequently than on an annual basis except for good cause shown, certifying as to its compliance with each of the maintenance provisions of its books, records, bank accounts and assets separate from those of any other Personthis Section 5.12.
Appears in 2 contracts
Sources: Project Loan Agreement (Agree Realty Corp), Project Loan Agreement (Agree Realty Corp)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (iI) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Loan Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the Properties, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the Properties.
(c) Borrower will not engage in any business other than the ownership, management and operation of the Properties.
(d) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any owner of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “"Related Parties”"), except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Person.
(e) Borrower has not incurred and will not incur any Indebtedness other than (i) the Loan Loan, and (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors (which amount excludes Taxes and costs incurred in connection with a Casualty and/or Condemnation) in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, note and is not in excess of sixty (60) days past duedue and does not exceed $2,000,000.00 in the aggregate. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the Properties.
(f) Borrower has not made and will not make any loans or advances to any Person and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents).
(g) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party without the prior written consent of Lender.
(iI) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person and Borrower’s 's assets will not be listed as assets on the financial statement of any other Person except as otherwise Person; provided, however, that Borrower's assets may be included in a consolidated financial statement of its parent companies if inclusion on such a consolidated statement is required in accordance to comply with the requirements of generally accepted accounting principles ("GAAP"), but only if (i) such consolidated financial statements shall contain a footnote to the effect that Borrower's assets are owned by Borrower and that they are being included on the financial statement of its parent solely to comply with the requirements of GAAP, and (ii) such assets shall be listed on Borrower's own separate balance sheet. Borrower will file its own tax returns to the extent required by applicable lawreturns; provided, however, that Borrower’s 's assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements requirement of applicable law GAAP or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposes.
(j) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person (including any Affiliate or other Related Party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and applicable law. Borrower shall maintain and utilize separate stationery, invoices and checks.
(k) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower.
(m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts resolutions and assets separate from those of any other Personagreements as official records.
Appears in 2 contracts
Sources: Loan Agreement (Inland Real Estate Corp), Loan Agreement (Inland Real Estate Corp)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owninghas not owned, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own own, and will not own any asset or property other than (i) the PropertiesProject, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesProject.
(cb) Borrower has not engaged in and will not engage in any business other than the ownership, management and operation of the PropertiesProject and Borrower will conduct and operate its business as presently conducted and operated.
(dc) Borrower has not entered into and will not enter into any contract or agreement with any Affiliate of the Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “Related Parties”), except upon terms and conditions that have been, are and shall be intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower has not incurred and will not incur any Indebtedness Debt other than (i) the Loan and Loan, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, note and is not in excess of paid within sixty (60) days past after the date when due, and (iii) Debt incurred in the financing of equipment and other personal property used on the Project. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passu) by the PropertiesProject.
(fe) Borrower has not made and will not make any loans or advances to any Person third party (including any affiliate or constituent party or any affiliate of any constituent party), and has not and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party.
(gf) Borrower has been, is and will remain solvent and Borrower has paid, and will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own funds and assets only, as the same have become due and as the same shall become due.
(hg) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor not and will Borrower not permit any Related Party to, constituent party to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party constituent party without the prior written consent of Lender.
(ih) Borrower has maintained, and will maintain maintain, all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; providedreturns. Borrower shall maintain its books, howeverrecords, that Borrower’s assets resolutions and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated agreements as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower has been and will be, and at all times has held itself out and will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate of Borrower, any constituent party of Borrower, or other Related Partyany Affiliate of any constituent party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize a separate telephone number, if any, and separate stationery, invoices and checks.
(kj) Borrower has maintained, and will maintain maintain, adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or of the sale of material Borrower.
(l) Borrower has not commingled and will not commingle the funds and other assets of BorrowerBorrower with those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other person.
(m) Borrower has and will maintain its assets in such a manner that it will not commingle be costly or difficult to segregate, ascertain or identify its individual assets with from those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameperson.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and has not, does not not, and will not hold itself out as being to be responsible for the debts or obligations of any other Personperson.
(o) Unless If Borrower is a single member limited partnership or a limited liability company formed under the laws of the State of Delawarecompany, Borrower each general partner or managing member (each, an "SPC PARTY") shall require that be a Person holding an corporation whose sole asset is its interest in Borrower be a corporation or limited liability company (the “and each such SPC Party”) which Party will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 6.14 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedParty.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members member of the board of directors (an "INDEPENDENT DIRECTOR") of the each SPC Party or if in Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective 's appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner partner, member, or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) affiliated with a customer of, or supplier to, the SPC Party, Borrower or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, or (iii) a Person controlling spouse, parent, sibling, child, or other family relative of any person described by (i) or (ii) above. As used herein, the term "AFFILIATE" means any person or entity other than the SPC Party (i) which owns beneficially, directly or indirectly, any outstanding shares of the SPC Party's stock or interest in the Borrower or (ii) which controls or is under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding or the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p)herein, the term “special purpose "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person or entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those , whether through ownership of Borrower and providevoting securities, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers by contract or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Personotherwise.
Appears in 1 contract
Sources: Loan Agreement (Equity Inns Inc)
Single Purpose Entity/Separateness. Borrower representsEach Mortgagor represents and warrants severally as to itself only, warrants and not jointly and severally as to any other Mortgagor, to Mortgagee and covenants with Mortgagee as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Mortgagor does not own and will not own own, and since the date of its formation has not owned, any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(cb) Borrower Mortgagor will not engage engage, and since the date of its formation has not engaged, in any business other than the ownership, management and operation of the PropertiesMortgaged Property and Mortgagor will conduct and operate its business as presently conducted and operated.
(dc) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower Guarantor or any Affiliate of any constituent party, owner Mortgagor or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms teims and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower Mortgagor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and Debt, (ii) unsecured trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal nonnal and reasonable under the circumstances, provided circumstances and such debt is not evidenced by a notepromissory note executed by Mortgagor, does not exceed $4,000,000.00 (iii) debt incurred in the aggregateordinary course of Mortgagor's business to finance equipment and other personal property used on the Premises the removal of which would not materially damage the Improvements or materially impair the value of the Improvements, provided that such debt is not evidenced by a promissory note executed by Mortgagor and is not in excess secured by any property other than the item of sixty equipment or personal property so financed; and (60iv) days past duepayment of the preferred equity peitnitted under Subparagraph (g) above. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property.
(fe) Borrower Mortgagor has not made and will not make any loans or advances to any Person third party (including Guarantor and any Affiliate of Mortgagor or Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties Guarantor or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)Affiliate of Mortgagor or Guarantor.
(gf) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower Mortgagor has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, good standing and Borrower right to do business in the state where it is organized or registered and in the state where the Premises are located, and Mortgagor will not, nor and will Borrower not permit any Related Party toits Governing Entity, to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylawsorganization, operating agreement, trust or other organizational documents of Borrower Mortgagor or such Related Party the Governing Entity that would either amend or modify the terms of the preferred equity referred to in Paragraph 8(g) above or cause Mortgagor or the Governing Entity to be violation of any other provision of this Paragraph 9, without the prior written consent of LenderMortgagee, which consent will not be unreasonably withheld, delayed or conditioned.
(ih) Borrower Mortgagor will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person Guarantor and Borrower’s assets will not be listed as assets on the financial statement Affiliates of any other Person except as otherwise required in accordance with GAAP. Borrower Mortgagor and Guarantor, and Mortgagor will file its own tax returns to the extent required by applicable law; provided, however, (except that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return as long as Mortgagor
is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal United States federal income tax purposes Mortgagor will be shown as a separate member of the consolidated group of which Mortgagor is a part for United States federal income tax purposes). Mortgagor shall maintain its books, records, resolutions and agreements as official records.
(ji) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person person (including Guarantor and any Affiliate or other Related Partyof Mortgagor and Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(k) Borrower . Mortgagor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower.
(m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Sources: Mortgage Agreement (American Realty Capital Healthcare Trust Inc)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the Properties, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the Properties.
(c) Borrower will not engage in any business other than the ownership, management management, leasing and operation of the PropertiesProperty and Borrower will conduct and operate its business as presently conducted and operated.
(db) Borrower will not enter into any contract or agreement with any Affiliate affiliate of Borrower, any constituent party of Borrower, the holder of any guarantors partnership or membership interest, any manager or the owner of the obligations of any beneficial interest in Borrower (each, a "Beneficial Owner") or any Affiliate affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Beneficial Owner, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(e) Borrower has not incurred and will not incur any Indebtedness other than (i) the Loan and (ii) trade payables in the ordinary course of business with trade creditors in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, and is not in excess of sixty (60) days past due. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the Properties.
(f) Borrower has not made and will not make any loans or advances to any Person and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents).
(g) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hc) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existenceexistence including, without limitation, the holding of such annual and other meetings as are required by the Borrower's organizational documents, and Borrower will not, nor will Borrower permit any Related Party to, constituent party or Beneficial Owner to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust certificate and agreement or other organizational documents of Borrower or such Related Party constituent party or Beneficial Owner, if such amendments would violate any provision of the Project Loan Documents, without the prior written consent of Lender, which consent shall not be unreasonably withheld, nor will Borrower permit any constituent party or Beneficial Owner to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, trust certificate and agreement or other organizational documents of such constituent party or Beneficial Owner, if such amendment, modification or change (i) would adversely affect the bankruptcy remote nature of Borrower; or (ii) would cause any of the assumptions upon which the Non-Consolidation Opinion is based to become inaccurate or untrue in any respect; or (iii) would adversely affect Lender's interest in the Project Loan. The Borrower shall deliver copies of minutes of annual meetings of the Borrower to the Lender within thirty (30) days of its receipt of written request therefor.
(id) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent where required by applicable law; providedcode or regulation. Borrower shall maintain its books, howeverrecords, that Borrower’s assets resolutions and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return agreements as official records. However, the Borrower does not and is not required to comply maintain its books in accordance with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposesGAAP.
(je) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate of Borrower, any constituent party of Borrower, any Beneficial Owner or other Related Partyany Affiliate of any constituent party), and shall conduct business in its own name and shall maintain and utilize separate stationery, invoices and checks. Borrower shall correct any known or unknown misunderstanding regarding its status as a separate entity, shall conduct business in its own name, entity and shall not identify itself as a division or part of its Affiliates or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checksBorrower.
(kf) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lg) Neither Borrower nor any Related Party constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger merger, in whole or in part, of Borrower or the sale of material assets all or substantially all of Borrower's or any constituent party's assets.
(mh) Borrower will not commingle its the funds and other assets of Borrower with those of any affiliate or constituent party, any Beneficial Owner, or any affiliate of any constituent party or Beneficial Owner, or any other Person Person.
(i) Borrower has and will hold all of maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its own name. Borrower will deposit all individual assets from those of its funds in checking accountsany affiliate or constituent party, savings accountsany Beneficial Owner, time deposits or certificate deposits in its own name any affiliate of any constituent party or invest such funds in its own nameBeneficial Owner, or any other Person.
(nj) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being to be responsible for the debts or obligations of any other Person.
(ok) Unless If Borrower is a single member (i) limited liability company, partnership or business trust, at least one manager, managing partner, general partner or trustee (the "SPC Member") of Borrower shall itself be a limited liability company formed under or corporation the laws sole asset of the State of Delaware, Borrower shall require that a Person holding an which is its interest in Borrower and which at all times has as one of its members or directors an individual who qualifies as an Independent Director, or (ii) corporation, at least one of its directors shall be an individual who qualifies as an Independent Director and who is a corporation shareholder of such corporation, and the SPC Member (in any case described in clause (i)), or limited liability company the Independent Director (the “SPC Party”) which in any case described in clause (ii)), will at all times comply, and will cause Borrower to comply, comply with each of the representations, warranties, and covenants contained in this Section 4.1.30 5.4 as if such representation, warranty or covenant was made were made, mutatis mutandis, directly by such PersonSPC Member or Independent Director. The structure of Borrower In any case described in clause (i), the SPC Member and the interest Beneficial Owner, and in any case described in clause (ii), the Independent Director and the Beneficial Owner, shall cause the Borrower at all times to comply with each of the SPC Party shall be reasonably acceptable to Lender representations, warranties, and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender covenants contained in connection with the Closing are not modified, this Section 5.4.
(l) Borrower shall not be required cause or permit the board of directors of Borrower or the SPC Member, as applicable, to have an SPC Party and all provisions take any action which, under the terms of this Agreement and any certificate of incorporation, by-laws, operating agreement or any voting trust agreement with respect to any common stock, requires the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members unanimous vote of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its the general partners or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director members of Borrower or the SPC Party (if Member, as applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is unless at the time of initial appointmentsuch action there shall be at least one member of the board of directors of Borrower or the SPC Member, or at any time while serving as applicable, who is an Independent Director.
(m) The Borrower has not incurred and will not incur any indebtedness, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause secured or unsecured, direct or indirect, absolute or contingent (pincluding guaranteeing any obligation), other than (i) the Project Loan or (ii) unsecured trade debt customarily payable within thirty (30) days;
(n) The Borrower shall conduct its business so that the assumptions made with respect to the Borrower, in that certain opinion letter (the "Non-Consolidation Opinion") dated of even date herewith delivered by ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ PLLC in connection with this Agreement are and shall remain true and correct in all respects for the term “special purpose entity” of the Project Loan Note. The Borrower shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended deliver a certificate to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, Lender within 30 days upon written request from the Lender but not limited tomore frequently than on an annual basis except for good cause shown, certifying as to its compliance with each of the maintenance provisions of its books, records, bank accounts and assets separate from those of any other Personthis Section 5.4.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower represents, hereby represents and warrants to Mezzanine Lender as of the date hereof and (unless otherwise consented to by Mezzanine Lender) covenants and/or agrees (as the case may be) as follows:
(a) The purpose for which Each of the Borrower is organized is and Mortgagors and the Mortgagor Managing Entity shall engage solely in the following business and shall be limited solely to not conduct its business in any manner inconsistent with the following: (i) in the case of Borrower, owning a 100% membership interest in Mortgagor I and a 100% membership interest in Mortgagor II, borrowing and giving security for the Mezzanine Loan pursuant to the terms of the Mezzanine Loan Documents and performing all acts required or permitted under the Mezzanine Loan, and transacting any and all lawful business for which a limited liability company may be organized under the Delaware Limited Liability Act that is incident, necessary and appropriate to the foregoing; (ii) in the case of each Mortgagor, owning, holding, selling, leasing, developing, financing, refinancing, transferring, exchanging, operating and managing the PropertiesMortgaged Property owned by such Mortgagor, (ii) entering into this Agreement with Lender, (iii) refinancing borrowing and giving security for the Properties in connection with a permitted repayment Mortgage Loan pursuant to the terms of the Mortgage Loan Documents and (iv) performing all acts required or permitted under the Mortgage Loan, and transacting any and all lawful business for which a Borrower limited liability company may be organized under its constitutive law that the laws regarding, and engaging in such other lawful activities permitted to, limited liability companies under the statute under which such Mortgagor is incidentformed as are necessary, necessary incidental or appropriate in connection therewith; and appropriate to accomplish (iii) in the foregoingcase of the Mortgagor Managing Entity, acting as non-member manager of each Mortgagor and engaging in such activities as are necessary, incidental or advisable in connection therewith.
(b) The Borrower does not own and or will not own any asset or property other than (i) the Properties, Pledged Company Interests and (ii) incidental personal property necessary for and used or to be used in connection with the ownership of such interests. The Mortgagor Managing Entity does not own nor will it own any asset or operation property other than (i) an ownership interest (if any) in the entity set forth in Schedule I and (ii) incidental personal property necessary for the ownership of such interests. None of the Properties.
(c) Borrower Mortgagors will not engage in any business other than the ownership, management and operation of the PropertiesMortgaged Property, and each Mortgagor will conduct and operate its business as presently conducted and operated in all material respects. The Borrower will not engage in any business other than the ownership of the Pledged Company Interests, and will conduct and operate its business as presently conducted and operated in all material respects.
(c) [Reserved].
(d) None of the Mortgagors or the Borrower will not enter into any contract or agreement with any Affiliate of Borrower, such Mortgagor or Borrower or any constituent party of Borrower, any guarantors of the obligations of such Mortgagor or Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “Related Parties”), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-arm's length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(e) Neither Borrower, either Mortgagor nor the Mortgagor Managing Entity has any outstanding Indebtedness for borrowed money, and, notwithstanding any other provision of this Agreement, and so long as any obligations under the Mezzanine Note remain outstanding and have not been discharged in full, neither Borrower, either Mortgagor nor the Mortgagor Managing Entity will (and Borrower has agrees that it will not incurred permit either Mortgagor to, and will cause each Mortgagor to cause the Mortgagor Managing Entity not to) incur any Indebtedness Indebtedness, other than (ix) in the Loan case of Borrower and (ii) Mortgagor Managing Entity, unsecured trade payables and operational debt not evidenced by a note and in an aggregate amount (for each such entity) not exceeding $100,000 at any one time, PROVIDED that such trade payables and operational debt shall be not more than ninety (90) days past due and incurred in the ordinary course of business with trade creditors in amounts as are normal business, and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 (y) in the aggregatecase of Mortgagors, Indebtedness of the types described in clauses (ii) and (iii) of Section 3.1.24(d) of the Mortgage Loan Agreement (subject to the limitations contained therein); PROVIDED, FURTHER, HOWEVER, each Mortgagor is not in excess of sixty (60) days past due. No Indebtedness authorized to execute, deliver and perform the Mortgage Note, the Mortgage and the other than Mortgage Loan Documents and Borrower is authorized to execute, deliver and perform the Debt may be secured (senior, subordinate or pari passu) by the Properties.Mezzanine Loan Documents;
(f) None of the Mortgagors or the Borrower has not made made, and none of the Mortgagors or the Borrower will not make make, any loans or advances in the nature of loans to any Person third party (including any Affiliate or constituent party of the Mortgagors or Borrower), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)its Affiliates.
(g) Each Mortgagor and the Borrower is and will remain solvent and the Borrower and each Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its their own assets only, and as the same shall become due.
(h) Each Mortgagor and the Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and none of the Mortgagors or the Borrower will notwill, nor will any Mortgagor or the Borrower permit any Related its respective SPC Party to, amend, modify or otherwise change the partnership certificate, partnership agreementcertificate of formation, articles of incorporation and bylaws, operating agreement, trust limited liability company agreement or other organizational documents of Borrower or such Related Party without the prior written consent of Lender.
(i) Borrower will maintain all of its booksMortgagor, records, financial statements and bank accounts separate from those of any other Person and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposes.
(j) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person (including any Affiliate or other Related Party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(k) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower.
(m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party in any manner that (if applicablei) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customerviolates the single purpose covenants set forth in this Section 5.1, or (ivii) a member of the immediate family of amends, modifies or otherwise changes any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual provision thereof that otherwise satisfies the foregoing shall by its terms cannot be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or modified at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), when the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on Mortgage Loan or the Mezzanine Loan is outstanding or by its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may terms cannot file voluntarily a bankruptcy petition be modified without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other PersonMezzanine Lender's consent.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owningMortgagor has not owned, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(cb) Borrower Mortgagor has not engaged and will not engage in any business other than the ownership, management and operation of the PropertiesMortgaged Property and Mortgagor will conduct and operate its business as presently conducted and operated.
(dc) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate affiliate of Borrowerthe Mortgagor, any constituent party of BorrowerMortgagor, any guarantors guarantor (a "Guarantor") of the obligations of Borrower Debt or any Affiliate part thereof or any affiliate of any constituent party, owner party of Mortgagor or guarantor (collectively, the “Related Parties”)any Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower Mortgagor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and (ii) Debt except for trade payables incurred in the ordinary course of its business of owning and operating the Mortgaged Property, provided that such debt (i) is not evidenced by a note, (ii) is not outstanding for more than sixty (60) days from the date such trade payables were incurred, (iii) is with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, and (iv) does not exceed $4,000,000.00 260,000 in the aggregate, and is not in excess of sixty (60) days past due. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property.
(fe) Borrower Mortgagor has not made and will not make any loans or advances to any Person third party (including any affiliate or constituent party of Mortgagor, any Guarantor or any affiliate or constituent party of Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party.
(g) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party without the prior written consent of Lender.
(i) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposes.
(j) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person (including any Affiliate or other Related Party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(k) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower.
(m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Sources: Mortgage, Assignment of Leases and Rents and Security Agreement (Charming Shoppes Inc)
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower the Mortgagor is organized is and shall be limited solely to (iA) owning, holding, selling, leasing, transferring, exchanging, operating and managing the PropertiesMortgaged Property, (iiB) entering into this Agreement the Loan with Lenderthe Mortgagee, (iiiC) refinancing the Properties Mortgaged Property in connection with a permitted repayment of the Loan Loan, and (ivD) transacting any and all lawful business for which a Borrower Mortgagor may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Mortgagor does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(c) Borrower Mortgagor will not engage in any business other than the ownership, management and operation of the PropertiesMortgaged Property.
(d) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate affiliate of BorrowerMortgagor, any constituent party of BorrowerMortgagor, any guarantors owner of the obligations of Borrower Mortgagor, the Guarantors (as hereinafter defined) or any Affiliate affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties the Mortgagor or any other Personconstituent party of Mortgagor or any owner of Mortgagor.
(e) Borrower Mortgagor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, other than the Loan and debt (i) the Loan and (ii) trade payables incurred in the ordinary course of business with trade creditors in amounts as are normal to vendors and reasonable under suppliers of services to the circumstancesMortgaged Property, provided such debt is (ii) not evidenced secured by a notethe Mortgaged Property, does not exceed $4,000,000.00 or any portion thereof, or by interests in the aggregateMortgagor or any constituent entity thereof, and is (iii) not in excess accompanied by any rights to control or to obtain control of sixty (60) days past duethe Mortgagor or any constituent entity thereof. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passuPARI PASSU) by the PropertiesMortgaged Property, or any portion thereof, or by interests in the Mortgagor or any constituent entity thereof.
(f) Borrower Mortgagor has not made and will not make any loans or advances to any Person entity or person (including any affiliate or any constituent party of Mortgagor or any owner of Mortgagor, any Guarantor or any affiliate of any constituent party or Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the constituent party . Loan Documents).No. 6518370
(g) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower Mortgagor has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower Mortgagor will not, nor will Borrower Mortgagor permit any Related Party to, constituent party of Mortgagor or any owner of Mortgagor or any Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower Mortgagor or such Related Party constituent party or Guarantor without the prior written consent of LenderMortgagee.
(i) Borrower Mortgagor will maintain all of its books, records, records and financial statements and bank accounts separate from those of its affiliates and any other Person and Borrower’s constituent party. Mortgagor's assets will not be listed as assets on the financial statement of any other Person entity except the ownership interests in Mortgagor may be listed as otherwise required in accordance with GAAPassets on the financial statements of the Trust. Borrower will file Mortgagor shall have its own tax returns to the extent required by applicable law; separate financial statement, provided, however, that Borrower’s Mortgagor's assets and income may be included in a consolidated tax return financial statement of its parent companies if inclusion on such a consolidated tax return statement is required to comply with the requirements of applicable generally accepted accounting principles ("GAAP"), provided that such consolidated financial statement shall contain a footnote to the effect that Mortgagor's assets are owned by Mortgagor and that they are being included on the financial statement of its parent solely to comply with the requirements of GAAP, and further provided that such assets shall be listed on Mortgagor's own separate balance sheet. Mortgagor will file its own tax returns if required by law or by reason and will not file a consolidated federal income tax return with any other corporation except the Trust in which case Mortgagor will be shown on a separate schedule of Borrower’s being treated such return as a disregarded entity for Federal income tax purposesseparate member of the consolidated group with its delineated financial information. Mortgagor shall maintain its books, records, resolutions and agreements as official records.
(j) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate affiliate of Mortgagor, any constituent party of Mortgagor, any Guarantor or other Related Partyany affiliate of any constituent party or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates affiliates as a division or part of the other except the Trust and shall maintain and utilize separate telephone numbers, stationery, invoices and checks.
(k) Borrower Mortgagor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower Mortgagor nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger merger, in whole or in part, or the sale of material assets of BorrowerMortgagor.
(m) Borrower Mortgagor will not commingle the funds and other assets of Mortgagor with those of any affiliate or any constituent party of Mortgagor or any owner of Loan No. 6518370 Mortgagor, any Guarantor, or any affiliate of any constituent party or Guarantor, or any other person, except for the Manager, and will not participate in a cash management system with any such party.
(n) Mortgagor will not commingle its assets with those of any other Person person or entity except the Manager and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits name or certificate deposits in its own name or invest such funds in its own agent's name.
(no) Borrower Mortgagor will not guarantee or become obligated for the debts of any other Person entity or person and does not and will not hold itself out as being responsible for the debts or obligations of any other Personperson.
(op) Unless Borrower If Mortgagor is a single member limited partnership or a limited liability company formed under the laws of the State of Delawarecompany, Borrower at least one general partner or member (an "SPC PARTY") shall require that a Person holding an interest in Borrower be a corporation or Delaware limited liability company (the “whose sole asset is its interest in Mortgagor, and each such SPC Party”) which Party will at all times comply, and will shall cause Borrower Mortgagor to comply, with each of the representations, warranties, warranties and covenants contained in this Section 4.1.30 PARAGRAPH 19 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and SPC Party; or in the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purposealternative, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower if Mortgagor is a single member limited liability company formed organized under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are which does not modified, Borrower shall not be required to have an SPC Party as one of its members, then Mortgagor shall have an independent manager and all provisions of this Agreement and Mortgagor shall cause to be delivered to Mortgagee such legal opinions with respect thereto from Delaware counsel reasonably satisfactory to Mortgagee that address such matters as may be required by Mortgagee or the other Loan Documents pertaining to SPC Party shall be disregardedRating Agencies at such time.
(pq) Borrower Mortgagor shall at all times cause there to be at least one (1) duly appointed members member of the board of directors (an "INDEPENDENT DIRECTOR") of Mortgagor, in the case of a corporation, and each SPC Party in Mortgagor in the case of a limited partnership or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) in each case reasonably satisfactory to Lender Mortgagee who shall is not have been at the time of each such individual’s respective initial appointment, and shall has not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i5) a shareholder of, or an officeryears; (a) stockholder, director, partner officer, employee, partner, attorney or employee ofcounsel of the SPC Party, Borrower the Mortgagor or any affiliate of its or their shareholders, subsidiaries or Affiliates, either of them; (iib) a customer ofcustomer, supplier or supplier to, or other person who derives any more than ten percent (10%) of its purchases or revenues from its activities with Borrower or the SPC Party (if applicable) Party, the Mortgagor or any Affiliate affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, them; (iiic) a Person person or other entity controlling or under common control with any such shareholderstockholder, partner partner, customer, supplier or customer, other person; or (ivd) a member of the immediate family of any such shareholderstockholder, director, officer, directoremployee, partner, employeecustomer, supplier or customer other person. As used herein, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of management, policies or activities of a person or entity, whether through ownership of voting securities, by contract or otherwise.
(r) Mortgagor shall not cause or permit the board of directors of any other director of Borrower or the SPC Party (if applicable). Notwithstanding in Mortgagor to take any action which, under the foregoingterms of any certificate of incorporation, an individual that otherwise satisfies by-laws or any voting trust agreement with respect to any common stock, requires the foregoing shall not be disqualified from serving as an Independent Director if such individual is vote of each SPC Party in Mortgagor unless at the time of initial appointment, or such action there shall be at any time while serving as least one member who is an Independent Director. Loan No. 6518370
(s) Mortgagor shall conduct its business so that the assumptions made with respect to Mortgagor in that certain opinion letter dated June __, an independent director of a “special purpose entity” affiliated 2004 (the "Non-Consolidation Opinion") delivered by Levenfeld ▇▇▇▇▇▇▇▇▇▇ in connection with Borrower. As used the Loan shall be true and correct in this clause all respects.
(p), the term “special purpose entity” t) Mortgagor shall mean an entity whose organizational documents contain restrictions on its activities allocate fairly and impose requirements intended to preserve separateness reasonably any overhead expenses that are substantially similar shared with an affiliate, including paying for office space and services performed by any employee of an affiliate.
(u) The stationery, invoices and checks utilized by Mortgagor or utilized to those of Borrower collect its funds or pay its expenses shall bear its own name and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may shall not file voluntarily a bankruptcy petition without bear the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those name of any other Personentity unless such entity is clearly designated as being Mortgagor's agent.
(v) Mortgagor shall not pledge its assets for the benefit of any other person or entity, and other than with respect to the Loan.
(w) Mortgagor shall correct any known misunderstanding regarding its separate identity.
(x) Mortgagor shall not identify itself as a division of any other person or entity except for the Trust.
Appears in 1 contract
Sources: Mortgage (Inland Western Retail Real Estate Trust Inc)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owninghas not owned, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own own, and will not own any asset or property other than (i) the PropertiesProject, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesProject.
(cb) Borrower has not engaged in and will not engage in any business other than the ownership, management and operation of the PropertiesProject and Borrower will conduct and operate its business as presently conducted and operated.
(dc) Borrower has not entered into and will not enter into any contract or agreement with any Affiliate of the Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “Related Parties”), except upon terms and conditions that have been, are and shall be intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower has not incurred and will not incur any Indebtedness Debt other than (i) the Loan and Loan, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a notenote and is paid within ninety (90) days after the date when due, does not exceed $4,000,000.00 and (iii) Debt incurred in the aggregate, financing of equipment and is not other personal property used on the Project in excess the ordinary course of sixty (60) days past duebusiness of prudent hotel management for similar hotels to the Project. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passu) by the PropertiesProject.
(fe) Borrower has not made and will not make any loans or advances to any Person third party (including any affiliate or constituent party or any affiliate of any constituent party), and has not and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party.
(gf) Borrower has been, is and will remain solvent and Borrower has paid, and will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own funds and assets only, as the same have become due and as the same shall become due.
(hg) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower not permit any Related Party to, constituent party to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party constituent party without the prior written consent of LenderLender which consent shall not be unreasonably withheld, conditioned or delayed.
(ih) Borrower has maintained, and will maintain maintain, all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent that it is required to file any tax return, and may file a consolidated federal income tax return with any other person as required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated in accordance with GAAP. Borrower shall maintain its books, records, resolutions and agreements as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower has been and will be, and at all times has held itself out and will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate of Borrower, any constituent party of Borrower, or other Related Partyany Affiliate of any constituent party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize a separate stationery, invoices and checks.
(kj) Borrower has maintained, and will maintain maintain, adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or of the sale of material Borrower.
(l) Borrower has not commingled and will not commingle the funds and other assets of BorrowerBorrower with those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other person other than legally permissible and authorized distributions to equity owners.
(m) Borrower has and will maintain its assets in such a manner that it will not commingle be costly or difficult to segregate, ascertain or identify its individual assets with from those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameperson.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and has not, does not not, and will not hold itself out as being to be responsible for the debts or obligations of any other Personperson except for guaranties issued in connection with the Franchise Agreement to the franchisor or licensor thereunder in the ordinary course of business of operating the Project.
(o) Unless If Borrower is a single member limited liability company formed under the laws of the State of Delawarecompany, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at formed and organized under Delaware law and otherwise comply with all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the other Rating Agencies Agency criteria for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under companies (including, without limitation, the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director inclusion of a “special purpose entityspringing member” affiliated with Borrower. As used and delivery of Delaware single member liability company opinions acceptable in this clause (p), all respects to Lender and to the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other PersonRating Agencies.
Appears in 1 contract
Sources: Loan Agreement (Winston Hotels Inc)
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower the Mortgagor is organized is and shall be limited solely to (iA) owning, holding, selling, leasing, transferring, exchanging, operating and managing the PropertiesMortgaged Property, (iiB) entering into this Agreement the Loan with Lenderthe Mortgagee, (iiiC) refinancing the Properties Mortgaged Property in connection with a permitted repayment of the Loan Loan, and (ivD) transacting any and all lawful business for which a Borrower Mortgagor may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.. Loan No. 6518217
(b) Borrower Mortgagor does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(c) Borrower Mortgagor will not engage in any business other than the ownership, management and operation of the PropertiesMortgaged Property.
(d) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate affiliate of BorrowerMortgagor, any constituent party of BorrowerMortgagor, any guarantors owner of the obligations of Borrower Mortgagor, the Guarantors (as hereinafter defined) or any Affiliate affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties the Mortgagor or any other Personconstituent party of Mortgagor or any owner of Mortgagor.
(e) Borrower Mortgagor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, other than the Loan and debt (i) the Loan and (ii) trade payables incurred in the ordinary course of business with trade creditors in amounts as are normal to vendors and reasonable under suppliers of services to the circumstancesMortgaged Property, provided such debt is (ii) not evidenced secured by a notethe Mortgaged Property, does not exceed $4,000,000.00 or any portion thereof, or by interests in the aggregateMortgagor or any constituent entity thereof, and is (iii) not in excess accompanied by any rights to control or to obtain control of sixty (60) days past duethe Mortgagor or any constituent entity thereof. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passuPARI PASSU) by the PropertiesMortgaged Property, or any portion thereof, or by interests in the Mortgagor or any constituent entity thereof.
(f) Borrower Mortgagor has not made and will not make any loans or advances to any Person entity or person (including any affiliate or any constituent party of Mortgagor or any owner of Mortgagor, any Guarantor or any affiliate of any constituent party or Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party.
(g) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower Mortgagor has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower Mortgagor will not, nor will Borrower Mortgagor permit any Related Party to, constituent party of Mortgagor or any owner of Mortgagor or any Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower Mortgagor or such Related Party constituent party or Guarantor without the prior written consent of LenderMortgagee.
(i) Borrower Mortgagor will maintain all of its books, records, records and financial statements and bank accounts separate from those of its affiliates and any other Person and Borrower’s constituent party. Mortgagor's assets will not be listed as assets on the financial statement of any other Person entity except the ownership interests in Mortgagor may be listed as otherwise required in accordance with GAAPassets on the financial statements of the Trust or Partnership. Borrower will file Mortgagor shall have its own tax returns to the extent required by applicable law; separate financial statement, provided, however, that Borrower’s Mortgagor's assets and income may be included in a consolidated tax return financial statement of its parent companies if inclusion on such a consolidated tax return statement is required to comply with the requirements of applicable Loan No. 6518217 generally accepted accounting principles ("GAAP"), provided that such consolidated financial statement shall contain a footnote to the effect that Mortgagor's assets are owned by Mortgagor and that they are being included on the financial statement of its parent solely to comply with the requirements of GAAP, and further provided that such assets shall be listed on Mortgagor's own separate balance sheet. Mortgagor will file its own tax returns if required by law and will not file a consolidated federal income tax return with any other corporation except the Trust or by reason Partnership in which case Mortgagor will be shown on a separate schedule of Borrower’s being treated such return as a disregarded entity for Federal income tax purposesseparate member of the consolidated group with its delineated financial information. Mortgagor shall maintain its books, records, resolutions and agreements as official records.
(j) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate affiliate of Mortgagor, any constituent party of Mortgagor, any Guarantor or other Related Partyany affiliate of any constituent party or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates affiliates as a division or part of the other except the Trust and Partnership and shall maintain and utilize separate telephone numbers, stationery, invoices and checks.
(k) Borrower Mortgagor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower Mortgagor nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger merger, in whole or in part, or the sale of material assets of BorrowerMortgagor.
(m) Borrower Mortgagor will not commingle the funds and other assets of Mortgagor with those of any affiliate or any constituent party of Mortgagor or any owner of Mortgagor, any Guarantor, or any affiliate of any constituent party or Guarantor, or any other person, except for the Manager, and will not participate in a cash management system with any such party.
(n) Mortgagor will not commingle its assets with those of any other Person person or entity except the Manager and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits name or certificate deposits in its own name or invest such funds in its own agent's name.
(no) Borrower Mortgagor will not guarantee or become obligated for the debts of any other Person entity or person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedperson.
(p) Borrower Mortgagor shall at all times cause there allocate fairly and reasonably any overhead expenses that are shared with an affiliate, including paying for office space and services performed by any employee of an affiliate.
(q) The stationery, invoices and checks utilized by Mortgagor or utilized to be at least one (1) duly appointed members of the board of directors of the SPC Party collect its funds or if Borrower is a single member Delaware limited liability company, pay its board of managers (an “Independent Director”) reasonably satisfactory to Lender who expenses shall not have been at the time of each such individual’s respective appointment, bear its own name and shall not be at any time while serving as a Independent Director and may not have been at any time during bear the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer name of any other director of Borrower or the SPC Party entity unless such entity is clearly designated as being Mortgagor's agent. Loan No. 6518217
(if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing r) Mortgagor shall not be disqualified from serving as an Independent Director if such individual is at pledge its assets for the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those benefit of any other Personperson or entity, and other than with respect to the Loan.
(s) Mortgagor shall correct any known misunderstanding regarding its separate identity.
(t) Mortgagor shall not identify itself as a division of any other person or entity except for the Trust or Partnership.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower the Mortgagor is organized is and shall be limited solely to (iA) owning, holding, selling, leasing, transferring, exchanging, operating and managing the PropertiesMortgaged Property, (iiB) entering into this Agreement the Loan with Lenderthe Mortgagee, (iiiC) refinancing the Properties Mortgaged Property in connection with a permitted repayment of the Loan Loan, and (ivD) transacting any and all lawful business for which a Borrower Mortgagor may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Mortgagor does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(c) Borrower Mortgagor will not engage in any business other than the ownership, management and operation of the PropertiesMortgaged Property.
(d) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate affiliate of BorrowerMortgagor, any constituent party of BorrowerMortgagor, any guarantors owner of the obligations of Borrower Mortgagor, the Guarantors (as hereinafter defined) or any Affiliate of affiliate or any constituent party, owner or guarantor (collectively, the “Related Parties”)party of Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties the Mortgagor or any other Personconstituent party of Mortgagor or any owner of Mortgagor.
(e) Borrower Mortgagor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, other than the Loan and debt (i) the Loan and (ii) trade payables incurred in the ordinary course of business with trade creditors in amounts as are normal to vendors and reasonable under suppliers of services to the circumstancesMortgaged Property, provided such debt is (ii) not evidenced secured by a notethe Mortgaged Property, does not exceed $4,000,000.00 or any portion thereof, or by interests in the aggregateMortgagor or any constituent entity thereof, and is (iii) not in excess accompanied by any rights to control or to obtain control of sixty (60) days past duethe Mortgagor or any constituent entity thereof. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property, or any portion thereof, or by interests in the Mortgagor or any constituent entity thereof.
(f) Borrower Mortgagor has not made and will not make any loans or advances to any Person entity or person (including any affiliate or any constituent party of Mortgagor or any owner of Mortgagor, any Guarantor or any affiliate or any constituent party of Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party .
(g) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower Mortgagor has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower Mortgagor will not, nor will Borrower Mortgagor permit any Related Party to, constituent party of Mortgagor or any owner of Mortgagor or any Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower Mortgagor or such Related Party constituent party or Guarantor without the prior written consent of LenderMortgagee.
(i) Borrower Mortgagor will maintain all of its books, records, financial statements and bank accounts separate from those of its affiliates and any other Person and Borrower’s constituent party. Mortgagor's assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAPentity. Borrower will file Mortgagor shall have its own tax returns to the extent required by applicable law; separate financial statement, provided, however, that Borrower’s Mortgagor's assets and income may be included in a consolidated tax return financial statement of its parent companies if inclusion on such a consolidated tax return statement is required to comply with the requirements of generally accepted accounting principles (“GAAP“), provided that such consolidated financial statement shall contain a footnote to the effect that Mortgagor's assets are owned by Mortgagor and that they are being included on the financial statement of its parent solely to comply with the requirements of GAAP, and further provided that such assets shall be listed on Mortgagor's own separate balance sheet. Mortgagor will file its own tax returns and will not file a consolidated federal income tax return with any other corporation, except as otherwise required or prohibited under applicable law state or by reason of Borrower’s being treated federal laws. Mortgagor shall maintain its books, records, resolutions and agreements as official records, except to the extent that Mortgagor is a disregarded entity for Federal income tax purposesunder applicable or federal tax.
(j) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate affiliate of Mortgagor, any constituent party of Mortgagor, any Guarantor or, any affiliate or other Related Partyany constituent party of Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates affiliates as a division or part of the other and shall maintain and utilize separate telephone numbers, stationery, invoices and checks.
(k) Borrower Mortgagor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower Mortgagor nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger merger, in whole or in part, or the sale of material assets of BorrowerMortgagor.
(m) Borrower Mortgagor will not commingle the funds and other assets of Mortgagor with those of any affiliate or any constituent party of Mortgagor or any owner of Mortgagor, any Guarantor, or any affiliate or any constituent party of Guarantor, or any other person, and will not participate in a cash management system with any such party; provided, however, Lender acknowledges that, provided no Event of Default has occurred, the tenants of the Mortgaged Property will make their payments to a property management account which distributes rents received. From such property management account, the applicable Manager pays applicable asset obligations (including, but not limited to payment of loan obligations such as debt service payments, payments of taxes, insurance, impounds, escrows and asset operating expenses). Although Mortgagee will allow Mortgagor to use this cash management system, it is solely for ease of cash administration/cash management and in no way lessen’s Mortgagor’s obligations to maintain its Single Purpose Entity status.
(n) Mortgagor will not commingle its assets with those of any other Person person or entity and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(no) Borrower Mortgagor will not guarantee or become obligated for the debts of any other Person entity or person and does not and will not hold itself out as being responsible for the debts or obligations of any other Personperson.
(op) Unless Borrower If Mortgagor is a single member limited partnership or a limited liability company formed under the laws of the State of Delawarecompany, Borrower at least one general partner or member (an “SPC Party“) shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “whose sole asset is its interest in Mortgagor, and each such SPC Party”) which Party will at all times comply, and will shall cause Borrower Mortgagor to comply, with each of the representations, warranties, warranties and covenants contained in this Section 4.1.30 Paragraph 19 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedParty.
(pq) Borrower Mortgagor shall at all times cause there allocate fairly and reasonably any overhead expenses that are shared with an affiliate, including paying for office space and services performed by any employee of an affiliate.
(r) The stationery, invoices and checks utilized by Mortgagor or utilized to be at least one (1) duly appointed members of the board of directors of the SPC Party collect its funds or if Borrower is a single member Delaware limited liability company, pay its board of managers (an “Independent Director”) reasonably satisfactory to Lender who expenses shall not have been at the time of each such individual’s respective appointment, bear its own name and shall not be at any time while serving as a Independent Director and may not have been at any time during bear the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer name of any other director of Borrower or the SPC Party entity unless such entity is clearly designated as being Mortgagor's agent.
(if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing s) Mortgagor shall not be disqualified from serving as an Independent Director if such individual is at pledge its assets for the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those benefit of any other Personperson or entity, and other than with respect to the Loan.
(t) Mortgagor shall correct any known misunderstanding regarding its separate identity.
(u) Mortgagor shall not identify itself as a division of any other person or entity.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower representsThe Owner Participant hereby represents and warrants to, warrants and covenants with, the Indenture Trustee and the Holders that as followsof the date hereof and until such time as the indebtedness secured hereunder shall be paid in full:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Owner Participant does not own and will not own any asset or property other than (i) the PropertiesBeneficial Interest in the Lessor, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesBeneficial Interest in the Lessor.
(b) To the extent its office, if any, is located in the offices of any of its Affiliates, the Owner Participant will pay fair market rent for its office space located therein and its fair share of any overhead costs with respect thereto.
(c) Borrower The Owner Participant will not engage in any business other than the ownership, management and operation ownership of the PropertiesBeneficial Interest in the Lessor, and the Owner Participant will conduct and operate its business as presently conducted and operated.
(d) Borrower The Owner Participant will not enter into any contract or agreement with any Affiliate of Borrowerthe Owner Participant, any constituent party of Borrowerthe Owner Participant, any guarantors of the obligations of Borrower guarantor or any Affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(e) Borrower The Owner Participant has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and unsecured trade debt or accounts payable customarily payable within thirty (ii30) trade payables in the ordinary course of business with trade creditors in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, and is not in excess of sixty (60) days past due. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the Propertiesdays.
(f) Borrower The Owner Participant has not made and will not make any loans or advances to any Person third party (including any Affiliate or constituent party, any guarantor or any Affiliate of any constituent party or guarantor), shall not pledge its assets for the benefit of any other entity and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire its members or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)its Affiliates.
(g) Borrower The Owner Participant is and will remain solvent and Borrower the Owner Participant will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become duedue subject, however, to the Owner Participant's rights to contest provided in the Operative Documents.
(h) Borrower The Owner Participant has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party without the prior written consent of Lender.
(i) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposes.
(j) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person (including any Affiliate or other Related Party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(k) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower.
(m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Sources: Participation Agreement (American Financial Realty Trust)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the Properties, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the Properties.
(c) Borrower will not engage in any business other than the ownership, management and operation of the Properties.
(d) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “Related Parties”"RELATED PARTIES"), except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or such Related Parties. Borrower will maintain an arm’s 's length relationship with such Related Parties or any other Person.
(e) Borrower has not incurred and will not incur any Indebtedness other than (i) the Loan and (ii) trade payables in the ordinary course of business with trade creditors in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 3,500,000.00 in the aggregate, and is not in excess of sixty (60) days past due. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the Properties.
(f) Borrower has not made and will not make any loans or advances to any Person and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents).
(g) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party without the prior written consent of Lender.
(i) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person and Borrower’s 's assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s 's assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s 's being treated as a disregarded entity for Federal income tax purposes.
(j) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person (including any Affiliate or other Related Party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(k) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower.
(m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “"SPC Party”PARTY") which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “"single purpose, bankruptcy remote entities”". Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”"INDEPENDENT DIRECTOR") reasonably satisfactory to Lender who shall not have been at the time of each such individual’s 's respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “"special purpose entity” " affiliated with Borrower. As used in this clause (p), the term “"special purpose entity” " shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “"separateness covenants”", including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Sources: Loan Agreement (U-Store-It Trust)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the Properties, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the Properties.
(c) Borrower will not engage in any business other than the ownership, management and operation of the Properties.
(d) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “Related Parties”"RELATED PARTIES"), except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or such Related Parties. Borrower will maintain an arm’s 's length relationship with such Related Parties or any other Person.
(e) Borrower has not incurred and will not incur any Indebtedness other than (i) the Loan and (ii) trade payables in the ordinary course of business with trade creditors in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, and is not in excess of sixty (60) days past due. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the Properties.
(f) Borrower has not made and will not make any loans or advances to any Person and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents).
(g) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party without the prior written consent of Lender.
(i) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person and Borrower’s 's assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAPPerson. Borrower will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s 's assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements requirement of GAAP or any applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposeslaw.
(j) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person (including any Affiliate or other Related Party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(k) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower.
(m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “"SPC Party”PARTY") which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “"single purpose, bankruptcy remote entities”". Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”"INDEPENDENT DIRECTOR") reasonably satisfactory to Lender who shall not have been at the time of each such individual’s 's respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “"special purpose entity” " affiliated with Borrower. As used in this clause (p), the term “"special purpose entity” " shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “"separateness covenants”", including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
(q) Borrower shall not cause or permit the board of directors of the SPC Party to take any action which, under the terms of any certificate of incorporation, by-laws or any voting trust agreement with respect to any common stock, requires a vote of the board of directors of the SPC Party of Borrower unless at the time of such action there shall be at least one member who is an Independent Director.
(r) Borrower shall allocate fairly and reasonably any overhead expenses that are shared with an Affiliate, including paying for office space and services performed by any employee of an Affiliate or Related Party.
(s) Borrower shall not pledge its assets for the benefit of any other Person other than with respect to the Loan.
(t) Borrower shall maintain a sufficient number of employees in light of its contemplated business operations and pay the salaries of its own employees from its own funds.
(u) Borrower shall conduct its business so that the assumptions made with respect to Borrower in the Insolvency Opinion, a true copy of which is attached as Schedule 4.1.30 attached hereto, shall be and remain true and correct in all respects.
Appears in 1 contract
Sources: Loan Agreement (U-Store-It Trust)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is has not and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the PropertiesProperty, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesProperty. Notwithstanding the foregoing or anything herein to the contrary, Borrower hereby represents, warrants and covenants that (i) Borrower previously owned the sole membership interest in Ramco Jacksonville Annex LLC, a Michigan limited liability company (the "Annex"), (ii) the Annex's sole purpose was to own and operate a portion of the Property, (iii) the Annex had no debt other than a loan in favor of Borrower, which loan has been satisfied (the "Annex Loan"), (iv) on December 28, 2006 Annex merged into Borrower, (v) Annex has no outstanding contingent liabilities in connection with the Annex Loan, the Property or any other matters and (vi) Borrower has no outstanding contingent liabilities in connection with its ownership of the sole membership interest in Annex, except in connection with that certain lease of a portion of the Property to Gander Mountain Company, a Minnesota corporation.
(cb) Borrower will has not engaged and shall not engage in any business or activity other than the ownership, management and operation of the PropertiesProperty and such activities as are necessary, incidental or appropriate in connection therewith, and Borrower will conduct and operate its business as presently conducted and operated.
(dc) Borrower will has not and shall not enter into or be a party to any transaction, contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors guarantor of the obligations of Debt or any part thereof (a "Guarantor") or any party which is directly or indirectly controlling, controlled by or under common control with Borrower or any Affiliate of any constituent party, owner or guarantor Guarantor (collectively, the “Related Parties”an "Affiliate"), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower other than any Guarantor or such Related PartiesAffiliate. Borrower will maintain an arm’s length relationship with such Related Parties or appropriately document and accurately record on its books and records all contracts, business transactions and transfers between Borrower, on the one hand, and any other Personof Ramco Partnership (as defined in Section 12 below), and/or the Ramco REIT (as defined in Section 12 below), on the other.
(ed) Borrower has not incurred and will shall not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and Debt; (ii) those certain loans in the aggregate amount of $100,672,375, which include (a) a construction loan made by JPMorgan Chase Bank, N.A. to Borrower on or about June 30, 2005, in the original principal amount of $58,772,375, and increased to the amount of $78,772,375 on or about January 31, 2007 (the "Construction Loan"), which Construction Loan was secured by a mortgage on the Property, (b) a mezzanine loan made by The Huntington Real Estate Investment Company to Borrower on or about December 14, 2005, in the original principal amount of $1,900,0000 (the "Huntington Loan"), which Huntington Loan was secured by a pledge of Guarantor's and Jacksonville River City Partners LLC's membership interest in Borrower and a second mortgage on the Property, and (c) a mezzanine loan made by Guarantor to Borrower on or about September 26, 2006, in the original principal amount of $10,000,000, and increased to the amount of $20,000,000 on or about February 14, 2007 (the "Ramco Loan"), which Ramco Loan was originally secured by a pledge of Borrower's membership interest in Annex but became unsecured after Annex merged with Borrower; (iii)
(A) trade payables and operational debt incurred in the ordinary course of business with trade creditors in connection with owning, operating and maintaining the Property, in such amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a notepromissory note or other security instrument and such trade and operational debt, does together with any Permitted Equipment Leases, are not exceed $4,000,000.00 at any time in the aggregate, and is not an aggregate amount in excess of two percent (2%) of the original loan amount evidenced by the Note and further provided that all such trade debts are paid within sixty (60) days past dueafter the same are incurred and all obligations of Borrower under construction contracts entered into by Borrower in connection with the Borrower's Construction Obligations (as defined in Section 68 hereof) and any alterations permitted pursuant to Section 10(b) hereof; (iv) Permitted Equipment Leases and (v) unsecured subordinated loans to Borrower (the "Subordinated Loans", each a "Subordinated Loan") made by principals or Affiliates of Borrower, provided that such loan or loans are made for the sole purpose of funding, and are used by Borrower solely for, working capital and/or otherwise to improve, alter and remodel the Property; provided, however, that Subordinated Loans shall be permitted only if and so long as each of the following conditions are satisfied:
(1) the payment terms of each Subordinate Loan shall not require payments to be made or payments to become due unless and until the Loan (or any refinancing loan the proceeds of which are used to repay the Loan) is fully paid and satisfied, except that voluntary payments by Borrower from excess cash flow from the Property may be permitted so long as no Event of Default has occurred and is continuing, (2) the aggregate outstanding balance of the Subordinated Loans and interest accrued and unpaid thereon together with the Debt (the "Total Debt Amount") shall not exceed 80% of the value of the Property (such value to be determined at the time each such Subordinated Loan is made); and (3) the lender under such Subordinated Loan shall, prior to making any Subordinate Loan advance, execute and deliver to and for the benefit of Lender a subordination and standstill agreement in the form of Exhibit E attached to the Closing Certificate (as defined in Subsection 8(f) above), and (4) all reasonable costs and expenses incurred by Lender in connection with such Subordinated Loans, including, but not limited to, the review of any and all materials required to be provided in connection therewith (including Lender's reasonable attorney's fees and expenses) shall be at the expense of Borrower and shall be paid by Borrower to Lender upon demand. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesProperty. Borrower hereby represents and warrants that (i) the Huntington Loan and the Ramco Loan are being satisfied on the date hereof upon the funding of the Loan, (ii) the Construction Loan is being assigned to Lender and the Existing Indebtedness (except as set forth below) is consolidated with the New Indebtedness upon funding of the Loan and (iii) neither Borrower nor Guarantor have any remaining liabilities or obligations in connection with the Huntington Loan, the Ramco Loan or the Construction Loan (other than (A) environmental and other limited and customary indemnity obligations and (B) the Existing Indebtedness which is consolidated with the New Indebtedness and amended and restated pursuant to the terms hereof).
(fe) Borrower has not made (except the Annex Loan) and will shall not make any loans or advances to Guarantor, or to any Affiliate or any constituent party of Borrower and Borrower has not and shall not make any loans or advances to any Person third parties (other than commercially reasonable tenant allowances, payments, contributions or reimbursements made by Borrower in the ordinary course of business to a tenant pursuant to the terms of the applicable lease for construction by or on behalf of such tenant of tenant improvements, and shall not acquire obligations other than advances to or securities deposits with vendors or service providers at the Property made in the ordinary course of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documentsbusiness).
(gf) Without intending to modify or diminish any limitations on recourse benefiting Borrower under this Mortgage or the other Loan Documents, Borrower is now and will intends to remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower has done or caused to be done and will shall do all things necessary necessary, to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, partner of Borrower to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, certificate of formation, operating agreement, trust or other organizational documents of Borrower or such Related Party in a manner which would adversely affect Borrower's existence as a single-purpose entity, without the prior written consent of Lender.
(ih) Borrower will has maintained and shall maintain all financial statements, accounting records, books and records, bank accounts and other entity documents separate from those of its Affiliates and any constituent party of Borrower or any other person or entity, and Borrower has filed and shall file its own tax returns, if any, as may be required under applicable law, or if part of a consolidated group filing, the Borrower is shown as a separate member of such group. Borrower has maintained and shall maintain its books, records, financial statements resolutions and bank accounts separate from those of any other Person and Borrower’s assets will not be listed agreements as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower has been and will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate Affiliate, any constituent party of Borrower or other Related Partyany Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks. Borrower has allocated and shall allocate fairly and reasonably any overhead for shared office space.
(j) Borrower has preserved and kept and shall preserve and keep in full force and effect its existence, good standing and qualification to do business in the state in which the Property is located and Borrower has observed and will observe all partnership, corporate or limited liability company formalities, as applicable.
(k) Borrower will has maintained and shall maintain adequate capital and a sufficient number of employees, if any, for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations; provided, except however, that no constituent party of Borrower additional capitalization shall be required to make fund any additional capital contributions to Borrowerprincipal, interest, or other debt requirements or other monetary obligations under the Loan Documents or the Loan. Borrower will pay the salaries of its own employees.
(l) Neither Borrower nor any Related Party will constituent party of Borrower has sought or, to the fullest extent permitted by law, shall seek or consent to the dissolution, dissolution or winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower, nor will Borrower merge with (except for the merger with Annex which has already occurred) or be consolidated into any other entity or acquire by purchase or otherwise all or substantially all of the business assets of, or any stock of beneficial ownership of, any entity.
(m) Borrower will has not and shall not commingle its the funds and other assets of Borrower with those of any Affiliate, any Guarantor, any constituent party of Borrower or any other Person person, and Borrower will hold all pay its own liabilities out of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameand assets.
(n) Borrower has maintained and shall maintain its assets in such a manner that it will not guarantee be costly or difficult to segregate, ascertain or identify its individual assets from those of any constituent party of Borrower, Affiliate, Guarantor or any other person.
(o) Borrower has not and shall not assume, guarantee, become obligated for the debts of any other Person and does not and will not or hold itself out as being to be responsible for the debts or obligations of any other Person.
person (o) Unless provided, that the foregoing shall not prevent Borrower is a single member limited liability company formed under from being and holding itself responsible for expenses incurred or obligations undertaken by the laws property manager of the State Property in respect of Delawareits duties regarding the Property or from providing or holding itself out as responsible for commercially reasonable tenant improvement allowances, payments, contributions or reimbursements made by the Borrower shall require that in the ordinary course of business to a Person holding an interest in Borrower be a corporation or limited liability company (tenant pursuant to the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each terms of the representations, warranties, and covenants contained in this Section 4.1.30 as if applicable lease for construction by or on behalf of such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedtenant).
(p) Borrower shall at obtain and maintain in full force and effect, and abide by and satisfy the material terms and conditions of, all times cause there material permits, licenses, registrations and other authorizations with or granted by any governmental authorities that may be required from time to be at least one time with respect to the performance of its obligations under this Mortgage.
(1q) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall does not have been at the time of each such individual’s respective appointment, and shall not be at own any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder ofsubsidiary, or an officermake any investment in any person or entity.
(r) Borrower has not and shall not without the unanimous consent of all its members, directorgeneral partners or directors, partner as applicable (including all Independent Directors), take any Material Action (as hereinafter defined). As used herein, "Material Action" shall mean to consolidate or employee ofmerge Borrower with or into any Person, or sell all or substantially all of the assets of Borrower, or to institute proceedings to have Borrower be adjudicated bankrupt or insolvent, or consent to the institution of bankruptcy or insolvency proceedings against Borrower or file a petition seeking, or consent to, reorganization or relief with respect to Borrower under any applicable federal or state law relating to bankruptcy, or consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of Borrower or a substantial part of its or their shareholders, subsidiaries or Affiliates, (ii) a customer ofproperty, or supplier tomake any assignment for the benefit of creditors of Borrower, or who derives any of admit in writing Borrower's inability to pay its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customerdebts generally as they become due, or (iv) a member of the immediate family take action in furtherance of any such shareholderaction, officeror, directorto the fullest extent permitted by law, partner, employee, supplier dissolve or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with liquidate Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Sources: Mortgage Agreement (Ramco Gershenson Properties Trust)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Mortgage Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, subleasing, transferring, exchanging, operating and managing the PropertiesProperty, (ii) entering into this Agreement the Mortgage Loan Documents with Mortgage Lender, (iii) refinancing the Properties Property in connection with a permitted repayment of the Mortgage Loan and (iv) transacting any and all lawful business for which a Borrower Person may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the PropertiesPledged Company Interests and (ii) incidental personal property necessary for the ownership of such interests. Mortgage Borrower does not own and will not own any asset or property other than (i) the Property, and (ii) incidental personal property necessary and convenient for and used or to be used in connection with the ownership or operation of the PropertiesProperty.
(c) Mortgage Borrower will not engage in any business other than the ownership, management and operation purposes as set forth in clause (a) above. Borrower will not engage in any business other than the ownership of the PropertiesPledged Company Interests and entering into the Loan Documents with Lender, and will conduct and operate its business as presently conducted and operated.
(d) Borrower Other than the Management Agreement, neither Significant Party will not enter into any contract or agreement with any Affiliate of Borrowersuch Significant Party, any constituent party of Borrowersuch Significant Party, any owner of such Significant Party, any guarantors of the obligations of Borrower such Significant Party or any Affiliate of any such constituent party, owner or guarantor (collectively, the “"Related Parties”"), except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower such Significant Party or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Person.
(e) Borrower No Significant Party has not incurred and will not (and Borrower agrees it will not permit Mortgage Borrower to) incur any Indebtedness other than (i) in the Loan case of Borrower, the Debt and (ii) in the case of Mortgage Borrower, (A) the Mortgage Loan and (B) trade payables and operational debt incurred in the ordinary course of business with trade creditors in amounts as are normal and reasonable under the circumstances, provided in no event shall such debt is not evidenced by a noteIndebtedness on this clause (ii)(B) (1) exceed, does not exceed $4,000,000.00 in the aggregate, $4,000,000, (2) be evidenced by a note and is not (3) remain unpaid in excess of sixty (60) days past duefrom the date incurred (unless being contested in good faith by Mortgage Borrower). No Indebtedness other than the Debt Mortgage Loan may be secured (senior, subordinate or pari passu) by the PropertiesProperty.
(f) Borrower No Significant Party has not made and neither Significant Party will not make any loans or advances to any Person and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents).
(g) Borrower Each Significant Party is and will remain solvent and Borrower each Significant Party will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its their own assets only, and as the same shall become due.
(h) Borrower Each Significant Party has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will notno Significant Party will, nor will Borrower any Significant Party permit any Related Affiliate of such Significant Party to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower such Significant Party in any material respect which adversely affects such Significant Party's existence as a single purpose entity or such Related Party its other obligations with respect to the Loan or Mortgage Loan without the prior written consent of Lender or Mortgage Lender, as the case may be.
(i) Borrower Each Significant Party will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person and Borrower’s and, except as required or permitted under GAAP, such Significant Party's assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAPPerson. Borrower Each Significant Party will file its own tax returns and will not file a consolidated federal income tax return with any other Person (except that such Significant Party may file or may be part of a consolidated federal tax return to the extent required or permitted by applicable law); provided, however, that Borrower’s there shall be an appropriate notation indicating the separate existence of such Significant Party and its assets and income may be included in a consolidated tax return of liabilities. Each Significant Party shall maintain its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated books, records, resolutions and agreements as a disregarded entity for Federal income tax purposesofficial records.
(j) Borrower Each Significant Party will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person (including any Affiliate or other Related Party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checkschecks or clearly indicate its separate existence in any correspondence sent by it or on its behalf.
(k) Borrower Each Significant Party will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower No Significant Party nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrowerany Significant Party.
(m) Borrower No Significant Party will not commingle its assets with those of any other Person and each Significant Party will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.;
(n) Borrower No Significant Party will not guarantee or become obligated for the debts of any other Person and each Significant Party does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is Each Significant Party shall be a single single-member limited liability company formed organized under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower Each Significant Party shall at all times cause there to be at least one (1) two duly appointed members Independent Managers of such Significant Party (provided, however, that no Person may serve as an Independent Manager of both Borrower and Mortgage Borrower).
(q) Each Significant Party shall allocate fairly and reasonably any overhead expenses that are shared with an Affiliate, including paying for office space and services performed by any employee of an Affiliate or Related Party.
(r) No Significant Party shall pledge its assets for the board benefit of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory any other Person other than with respect to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder ofin the case of Borrower, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, the Loan and (ii) in the case of Mortgage Borrower, the Mortgage Loan.
(s) Each Significant Party shall maintain a customer of, or supplier to, or who derives any sufficient number of employees in light of its purchases contemplated business operations or revenues retain the services of agents or consultants therefor and pay the salaries of such employees, agents or consultants from its activities with own funds.
(t) Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself its business so that the assumptions made with respect to Borrower in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts Nonconsolidation Opinion shall be true and assets separate from those of any other Personcorrect in all material respects.
Appears in 1 contract
Sources: Mezzanine Loan Agreement (Prime Group Realty Trust)
Single Purpose Entity/Separateness. Borrower Grantor represents, warrants and covenants as follows:
(a) The purpose for which Borrower the Grantor is organized is and shall be limited solely to (iA) owning, holding, selling, leasing, transferring, exchanging, operating and managing the PropertiesTrust Property, (iiB) entering into this Agreement the Loan with Lenderthe Grantee, (iiiC) refinancing the Properties Trust Property in connection with a permitted repayment of the Loan Loan, and (ivD) transacting any and all lawful business for which a Borrower Grantor may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Grantor does not own and will not own any asset or property other than (i) the PropertiesTrust Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesTrust Property.
(c) Borrower Grantor will not engage in any business other than the ownership, management and operation of the PropertiesTrust Property.
(d) Borrower Grantor will not enter into any contract or agreement with any Affiliate affiliate of BorrowerGrantor, any constituent party of BorrowerGrantor, any guarantors owner of the obligations of Borrower Grantor, the Guarantors (as hereinafter defined) or any Affiliate affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties the Grantor or any other Personconstituent party of Grantor or any owner of Grantor.
(e) Borrower Grantor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, other than the Loan and debt (i) the Loan and (ii) trade payables incurred in the ordinary course of business with trade creditors in amounts as are normal to vendors and reasonable under suppliers of services to the circumstancesTrust Property, provided such debt is (ii) not evidenced secured by a notethe Trust Property, does not exceed $4,000,000.00 or any portion thereof, or by interests in the aggregateGrantor or any constituent entity thereof, and is (iii) not in excess accompanied by any rights to control or to obtain control of sixty (60) days past duethe Grantor or any constituent entity thereof. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passuPARI PASSU) by the PropertiesTrust Property, or any portion thereof, or by interests in the Grantor or any constituent entity thereof.
(f) Borrower Grantor has not made and will not make any loans or advances to any Person entity or person (including any affiliate or any constituent party of Grantor or any owner of Grantor, any Guarantor or any affiliate of any constituent party or Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the constituent party. Loan Documents).No. 6518403
(g) Borrower Grantor is and will remain solvent and Borrower Grantor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower Grantor has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower Grantor will not, nor will Borrower Grantor permit any Related Party to, constituent party of Grantor or any owner of Grantor or any Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower Grantor or such Related Party constituent party or Guarantor without the prior written consent of LenderGrantee.
(i) Borrower Grantor will maintain all of its books, records, records and financial statements and bank accounts separate from those of its affiliates and any other Person and Borrower’s constituent party. Grantor's assets will not be listed as assets on the financial statement of any other Person entity except the ownership interests in Grantor may be listed as otherwise required in accordance with GAAPassets on the financial statements of the Trust. Borrower will file Grantor shall have its own tax returns to the extent required by applicable law; separate financial statement, provided, however, that Borrower’s Grantor's assets and income may be included in a consolidated tax return financial statement of its parent companies if inclusion on such a consolidated tax return statement is required to comply with the requirements of applicable generally accepted accounting principles ("GAAP"), provided that such consolidated financial statement shall contain a footnote to the effect that Grantor's assets are owned by Grantor and that they are being included on the financial statement of its parent solely to comply with the requirements of GAAP, and further provided that such assets shall be listed on Grantor's own separate balance sheet. Grantor will file its own tax returns if required by law or by reason and will not file a consolidated federal income tax return with any other corporation except the Trust in which case Grantor will be shown on a separate schedule of Borrower’s being treated such return as a disregarded entity for Federal income tax purposesseparate member of the consolidated group with its delineated financial information. Grantor shall maintain its books, records, resolutions and agreements as official records.
(j) Borrower Grantor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate affiliate of Grantor, any constituent party of Grantor, any Guarantor or other Related Partyany affiliate of any constituent party or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates affiliates as a division or part of the other except the Trust and shall maintain and utilize separate telephone numbers, stationery, invoices and checks.
(k) Borrower Grantor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower Grantor nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger merger, in whole or in part, or the sale of material assets of BorrowerGrantor.
(m) Borrower Grantor will not commingle the funds and other assets of Grantor with those of any affiliate or any constituent party of Grantor or any owner of Grantor, any Guarantor, or any affiliate of any constituent party or Guarantor, or any other person except for the Manager, and will not participate in a cash management system with any such party.
(n) Grantor will not commingle its assets with those of any other Person person or entity except the Manager and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own agent's name.. Loan No. 6518403
(no) Borrower Grantor will not guarantee or become obligated for the debts of any other Person entity or person and does not and will not hold itself out as being responsible for the debts or obligations of any other Personperson.
(op) Unless Borrower If Grantor is a single member limited partnership or a limited liability company formed under the laws of the State of Delawarecompany, Borrower at least one general partner or member (an "SPC PARTY") shall require that a Person holding an interest in Borrower be a corporation or Delaware limited liability company (the “whose sole asset is its interest in Grantor, and each such SPC Party”) which Party will at all times comply, and will shall cause Borrower Grantor to comply, with each of the representations, warranties, warranties and covenants contained in this Section 4.1.30 PARAGRAPH 19 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and SPC Party; or in the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purposealternative, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower if Grantor is a single member limited liability company formed organized under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are which does not modified, Borrower shall not be required to have an SPC Party as one of its members, then Grantor shall have an independent manager and all provisions of this Agreement and Grantor shall cause to be delivered to rantee such legal opinions with respect thereto from Delaware counsel reasonably satisfactory to Grantee that address such matters as may be required by Grantee or the other Loan Documents pertaining to SPC Party shall be disregarded.Rating Agencies at such time..
(pq) Borrower Grantor shall at all times cause there to be at least one (1) duly appointed members member of the board of directors (an "INDEPENDENT DIRECTOR") of Grantor, in the case of a corporation or Delaware limited liability company whose sole asset is its interest in Grantor, and each SPC Party in Grantor in the case of a limited partnership or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) in each case reasonably satisfactory to Lender Grantee who shall is not have been at the time of each such individual’s respective initial appointment, and shall has not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i5) a shareholder of, or an officeryears: (a) stockholder, director, partner officer, employee, partner, attorney or employee ofcounsel of the SPC Party, Borrower the Grantor or any affiliate of its or their shareholders, subsidiaries or Affiliates, either of them; (iib) a customer ofcustomer, supplier or supplier to, or other person who derives any more than ten percent (10%) of its purchases or revenues from its activities with Borrower or the SPC Party (if applicable) Party, the Grantor or any Affiliate affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, them; (iiic) a Person person or other entity controlling or under common control with any such shareholderstockholder, partner partner, customer, supplier or customer, other person; or (ivd) a member of the immediate family of any such shareholderstockholder, director, officer, directoremployee, partner, employeecustomer, supplier or customer other person. As used herein, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of management, policies or activities of a person or entity, whether through ownership of voting securities, by contract or otherwise.
(r) Grantor shall not cause or permit the board of directors of each SPC Party in Grantor to take any action which, under the terms of any other director certificate of Borrower incorporation, by-laws or any voting trust agreement with respect to any common stock, requires the vote of each SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is in Grantor unless at the time of initial appointment, or such action there shall be at any time while serving as least one member who is an Independent Director.
(s) Grantor shall conduct its business so that the assumptions made with respect to Grantor in that certain opinion letter dated June 30, an independent director of a “special purpose entity” affiliated 2004 (the "Non-Consolidation Opinion") delivered by Levenfeld ▇▇▇▇▇▇▇▇▇▇ in connection with Borrower. As used the Loan shall be true and correct in this clause all respects.
(p), the term “special purpose entity” t) Grantor shall mean an entity whose organizational documents contain restrictions on its activities allocate fairly and impose requirements intended to preserve separateness reasonably any overhead expenses that are substantially similar shared with an affiliate, including paying for office space and services performed by any employee of an affiliate.
(u) The stationery, invoices and checks utilized by Grantor or utilized to those of Borrower collect its funds or pay its expenses shall bear its own name and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may shall not file voluntarily a bankruptcy petition without bear the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those name of any other Personentity unless such entity is clearly designated as being Grantor's agent.
(v) Grantor shall not pledge its assets for the benefit of any other person or entity, and other than with respect to the Loan. Loan No. 6518403
(w) Grantor shall correct any known misunderstanding regarding its separate identity.
(x) Grantor shall not identify itself as a division of any other person or entity.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:.
(a) The purpose for which Borrower is organized is Mortgagor has not and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(cb) Borrower will ▇▇▇▇▇▇▇▇▇ has not engaged and shall not engage in any business or activity other than the ownership, management and operation of the PropertiesMortgaged Property and Mortgagor will conduct and operate in all material respects its business as presently conducted and operated.
(dc) Borrower will Mortgagor has not and shall not enter into or be a party to any transaction, contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors guarantor of the obligations of Borrower Debt or any Affiliate of part thereof (a "Guarantor") or any constituent partyparty which is directly or indirectly controlling, owner controlled by or guarantor under common control with Mortgagor or Guarantor (collectively, the “Related Parties”an "Affiliate"), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an armsarm's-length basis with third parties not so affiliated with Borrower other than any Guarantor or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other PersonAffiliate.
(ed) Borrower Mortgagor has not incurred and will shall not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan Debt and (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors in connection with owning, operating and maintaining the Mortgaged Property, in such amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, promissory note or other security instrument and is not at any time in an aggregate amount in excess of two percent (2%) of the original loan amount evidenced by the Note, and further provided that all such trade debts are paid within sixty (60) days past dueafter the same are incurred. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property.
(fe) Borrower Mortgagor has not made and will shall not make any loans or advances to any Person and shall not acquire obligations or securities of third party, nor to Guarantor, any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties Affiliate or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party or Mortgagor.
(gf) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party without the prior written consent of Lender.
(i) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposes.
(j) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person (including any Affiliate or other Related Party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(k) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower.
(m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower Trustor represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Trustor does not own and will not own any encumbered asset or property other than (i) the PropertiesTrust Property and the Other Mortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesTrust Property and the Other Mortgaged Property.
(cb) Borrower Trustor will not engage in any business other than the ownership, management and operation of the PropertiesTrust Property and the Other Mortgaged Property (as hereinafter defined) and Trustor will conduct and operate its business as presently conducted and operated. Trustor shall not pledge its assets for the benefit of any other person or entity except as permitted under the Indenture.
(dc) Borrower Trustor will not enter into any contract or agreement with any Affiliate affiliate of BorrowerTrustor, any constituent party of BorrowerTrustor, any guarantors of the obligations of Borrower Guarantor or any Affiliate affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar not less favorable to it than those that would be available on an arms-length basis with third parties not so affiliated other than any such party. Trustor will allocate fairly and reasonably any overhead expenses that are shared with Borrower or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or affiliate, including paying for office space and services performed by any other Personemployee of an affiliate.
(ed) Borrower Trustor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and Indebtedness, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors in such amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, note and is not in excess of outstanding for more than sixty (60) days past due(or such longer period as any such debt shall be contested by Trustor in good faith) and (iii) debt incurred in the financing of equipment and other personal property used on the Trust Property (collectively, the "PERMITTED INDEBTEDNESS"). No Indebtedness Except as permitted under the Indenture, no indebtedness other than the Debt Indebtedness may be secured (senior, subordinate or pari passuPARI PASSU) by all or any portion of the PropertiesTrust Property, except that debt incurred in the financing of equipment and other personal property used on the Trust Property in an amount not to exceed $10,000 in any one (1) year may be secured by purchase money security interests on such equipment or personal property.
(fe) Borrower Trustor has not made and will not make any loans or advances to any Person third party (including any affiliate or constituent party, any Guarantor or any affiliate of any constituent party or Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any constituent party and shall not hold evidence of indebtedness issued by any other Person person or entity (except that Borrower may invest in those investments permitted under the Loan Documentsother than cash and investment-grade securities).
(gf) Borrower Trustor is and will remain solvent and Borrower Trustor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower Trustor has done or caused to be done and will do all things necessary to observe organizational corporate formalities and preserve its existence, and Borrower Trustor will not, nor will Borrower Trustor permit any Related Party to, constituent party or Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower Trustor or such Related Party without constituent party or Guarantor in a manner which would adversely affect the prior written consent of LenderTrustor's existence as a single purpose entity except as permitted or contemplated under the Indenture unless otherwise approved by the Rating Agencies.
(ih) Borrower Trustor will maintain all of its books, records, financial statements and bank accounts separate from those of its affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower Trustor will file its own tax returns to the extent required by applicable law; providedreturns. Trustor shall maintain its books, howeverrecords, that Borrower’s assets resolutions and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated agreements as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower Trustor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate affiliate of Trustor, any constituent party of Trustor, any Guarantor or other Related Partyany affiliate of any constituent party or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates affiliates as a division or part of the other and shall maintain and utilize separate telephone numbers, stationery, invoices and checks.
(kj) Borrower Trustor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower Trustor nor any Related Party constituent party will seek the dissolution, winding up, sale of assets, liquidation, consolidation or merger merger, in whole or in part, or of Trustor except as permitted under the sale of material Indenture.
(l) Trustor will not commingle the funds and other assets of BorrowerTrustor with those of any affiliate or constituent party, any Guarantor, or any affiliate of any constituent party or Guarantor, or any other person.
(m) Borrower Trustor has and will maintain its assets in such a manner that it will not commingle be costly or difficult to segregate, ascertain or identify its individual assets with from those of any affiliate or constituent party, any Guarantor, or any affiliate of any constituent party or Guarantor, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameperson.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and Trustor does not and will not hold itself out as being to be responsible for the debts or obligations of any other Personperson or entity and does not and will not guarantee the debts or obligations of any other person or entity.
(o) Unless Borrower Trustor shall not hold out its credit as being available to satisfy the obligations of any other person or entity.
(p) Trustor shall maintain a sufficient number of employees in light of its contemplated business operations and shall pay the salaries of its own employees from its own funds.
(q) If Trustor is a single member limited partnership or a limited liability company formed under the laws of the State of Delawarecompany, Borrower each general partner or managing member (each such general partner or managing member being an "SPC MEMBER") shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “whose sole asset is its interest in Trustor, and each such SPC Party”) which Member will at all times comply, and will shall cause Borrower Trustor to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 PARAGRAPH 19 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedMember.
(pr) Borrower Trustor shall at all times cause there to be at least one (1) duly appointed members member of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent "INDEPENDENT Director”") of each SPC Member of Trustor reasonably satisfactory to Lender Beneficiary who shall not have been at the time of each such individual’s respective 's appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner officer or employee of, Borrower Trustor or any of its or their shareholders, subsidiaries or Affiliatesaffiliates, (ii) a customer of, or supplier to, Trustor or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliatesaffiliates, (iii) a Person person or other entity controlling or under common control with any such shareholder, partner supplier or customer, customer or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with BorrowerTrustor. As used in this clause (p)herein, the term “special purpose "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person or entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those , whether through ownership of Borrower and providevoting securities, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers by contract or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Personotherwise.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower the Mortgagor is organized is and shall be limited solely to (iA) owning, holding, selling, leasing, transferring, exchanging, operating and managing the PropertiesMortgaged Property, (iiB) entering into this Agreement the Loan with Lenderthe Mortgagee, (iiiC) refinancing the Properties Mortgaged Property in connection with a permitted repayment of the Loan Loan, and (ivD) transacting any and all lawful business for which a Borrower Mortgagor may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Mortgagor does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(c) Borrower Mortgagor will not engage in any business other than the ownership, management and operation of the PropertiesMortgaged Property.
(d) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate affiliate of BorrowerMortgagor, any constituent party of BorrowerMortgagor, any guarantors owner of the obligations of Borrower Mortgagor, the Guarantors (as hereinafter defined) or any Affiliate affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties the Mortgagor or any other Personconstituent party of Mortgagor or any owner of Mortgagor.
(e) Borrower Mortgagor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, other than the Loan and debt (i) the Loan and (ii) trade payables incurred in the ordinary course of business with trade creditors in amounts as are normal to vendors and reasonable under suppliers of services to the circumstancesMortgaged Property, provided such debt is (ii) not evidenced secured by a notethe Mortgaged Property, does not exceed $4,000,000.00 or any portion thereof, or by interests in the aggregateMortgagor or any constituent entity thereof, and is (iii) not in excess accompanied by any rights to control or to obtain control of sixty (60) days past duethe Mortgagor or any constituent entity thereof. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property, or any portion thereof, or by interests in the Mortgagor or any constituent entity thereof.
(f) Borrower Mortgagor has not made and will not make any loans or advances to any Person entity or person (including any affiliate or any constituent party of Mortgagor or any owner of Mortgagor, any Guarantor or any affiliate of any constituent party or Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party .
(g) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower Mortgagor has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower Mortgagor will not, nor will Borrower Mortgagor permit any Related Party to, constituent party of Mortgagor or any owner of Mortgagor or any Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower Mortgagor or such Related Party constituent party or Guarantor without the prior written consent of LenderMortgagee.
(i) Borrower Mortgagor will maintain all of its books, records, financial statements and bank accounts separate from those of its affiliates and any other Person and Borrower’s constituent party. Subject to the immediately succeeding sentence, Mortgagor's assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAPentity. Borrower will file Mortgagor shall have its own tax returns to the extent required by applicable law; separate financial statement, provided, however, that Borrower’s Mortgagor's assets and income may be included in a consolidated tax return financial statement of its parent companies if inclusion on such a consolidated tax return statement is required to comply with the requirements of applicable law generally accepted accounting principles ("GAAP"), provided that such consolidated financial statement shall contain a footnote to the effect that Mortgagor's assets are owned by Mortgagor and that they are being included on the financial statement of its parent solely to comply with the requirements of GAAP, and further provided that such assets shall be listed on Mortgagor's own separate balance sheet. Mortgagor will file its own tax returns or by reason of Borrower’s being treated as may file a disregarded entity for Federal consolidated federal income tax purposesreturn with Dress Barn. Mortgagor shall maintain its books, records, resolutions and agreements as official records.
(j) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate affiliate of Mortgagor, any constituent party of Mortgagor, any Guarantor or other Related Partyany affiliate of any constituent party or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates affiliates as a division or part of the other and shall maintain and utilize separate telephone numbers, stationery, invoices and checks.
(k) Borrower Mortgagor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower Mortgagor nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger merger, in whole or in part, or the sale of material assets of BorrowerMortgagor.
(m) Borrower Mortgagor will not commingle the funds and other assets of Mortgagor with those of any affiliate or any constituent party of Mortgagor or any owner of Mortgagor, any Guarantor, or any affiliate of any constituent party or Guarantor, or any other person, and will not participate in a cash management system with any such party.
(n) Mortgagor will not commingle its assets with those of any other Person person or entity and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(no) Borrower Mortgagor will not guarantee or become obligated for the debts of any other Person entity or person and does not and will not hold itself out as being responsible for the debts or obligations of any other Personperson.
(op) Unless Borrower is Mortgagor shall be a single member Delaware limited liability company formed under the laws company, having either: (i) a minimum of the State two (2) members, one of Delaware, Borrower which shall require that a Person holding an interest in Borrower be a corporation or limited liability company whose sole asset is its interest in Mortgagor (the “an "SPC Party”) which "), and each such SPC Party will at all times comply, and will shall cause Borrower Mortgagor to comply, with each of the representations, warranties, warranties and covenants contained in this Section 4.1.30 Paragraph 19 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower SPC Party, or (ii) one member ("Sole Member") that is not required to be an SPC Party, and the interest shall cause Mortgagor to comply with each of the SPC Party representations, warranties and covenants contained in this Paragraph 19, provided that: (aa) Mortgagor shall be reasonably acceptable to Lender and have at least two (2) independent directors, each of which shall satisfy comply with all of the requirements of an Independent Director as set forth in subsection (q) below; (bb) upon the Rating Agencies for “single purposeoccurrence of any event that causes the Sole Member to cease to be a member of Mortgagor, bankruptcy remote entities”. Notwithstanding the foregoing so long each person then acting as Borrower is a single member limited liability company formed under the laws an independent director of the State Mortgagor shall automatically be admitted as a member of Delaware Mortgagor as a special member (a "Special Member"); (cc) no Special Member shall be permitted to resign from, or terminate its membership interest in, Mortgagor, or transfer its rights as a Special Member unless a successor person has become a member of Mortgagor as a Special Member; and (dd) the Special Members shall automatically cease to be members of Mortgagor upon the admission to Mortgagor of a substitute member or members in compliance with this subsection (p). The certificate of formation, operating agreement and all other organization documents of Mortgagor and all agreements affecting same, and all amendments, supplements or restatements of the same, and the organizational documents form and substances of Borrower the same, shall be subject to the prior written approval of Mortgagee. In the event of the occurrence of any of the changes set forth in this subsection, Mortgagor shall furnish to Mortgagee, as delivered a condition to Lender in connection with the Closing are not modifiedany approval by Mortgagee, Borrower shall not such certificates, documents, consents and legal opinions as may be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedby Mortgagee or any rating agency.
(pq) Borrower Mortgagor shall at all times cause there to be at least one (1) duly appointed members member of the board of directors (an "Independent Director") of Mortgagor, in the case of a corporation, and each SPC Party in Mortgagor, if any is required under subsection (p) above, in the case of a limited partnership or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) in each case reasonably satisfactory to Lender Mortgagee who shall is not have been at the time of each such individual’s respective initial appointment, and shall has not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i5) a shareholder of, or an officeryears: (a) stockholder, director, partner officer, employee, partner, attorney or employee ofcounsel of the SPC Party, Borrower the Mortgagor or any affiliate of its or their shareholders, subsidiaries or Affiliates, either of them; (iib) a customer ofcustomer, supplier or supplier to, or other person who derives any more than ten percent (10%) of its purchases or revenues from its activities with Borrower or the SPC Party (if applicable) Party, the Mortgagor or any Affiliate affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, them; (iiic) a Person person or other entity controlling or under common control with any such shareholderstockholder, partner partner, customer, supplier or customer, other person; or (ivd) a member of the immediate family of any such shareholderstockholder, director, officer, directoremployee, partner, employeecustomer, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrowerperson. As used in this clause (p)herein, the term “special purpose "control" means the possession, directly or indirectly, of the power to direct or cause the direction of management, policies or activities of a person or entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those , whether through ownership of Borrower and providevoting securities, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers by contract or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Personotherwise.
Appears in 1 contract
Sources: Mortgage, Assignment of Leases and Rents and Security Agreement (Dress Barn Inc)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the PropertiesProject, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesProject.
(cb) Borrower will not engage in any business other than the ownership, management and operation of the PropertiesProject and Borrower will conduct and operate its business as presently conducted and operated.
(dc) Borrower will not enter into any contract or agreement with any Affiliate of the Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower Guarantors or any Affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Person.
(ed) Borrower has not incurred and will not incur any Indebtedness Debt other than (i) the Loan and Loan, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a notenote and is paid when due, does not exceed $4,000,000.00 and (iii) Debt incurred in the aggregate, financing of equipment and is not in excess of sixty (60) days past dueother personal property used on the Project. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passu) by the PropertiesProject.
(fe) Borrower has not made and will not make any loans or advances to any Person third party (including any affiliate or constituent party, any Guarantor or any affiliate of any constituent party or Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its Affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party.
(gf) Borrower is and will use best efforts to remain solvent and Borrower will pay pay, to the extent proceeds are available from the Project, its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, constituent party or any Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party constituent party or Guarantor without the prior written consent of Lender.
(ih) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; providedreturns. Borrower shall maintain its books, howeverrecords, that Borrower’s assets resolutions and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated agreements as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate of Borrower, any constituent party of Borrower, any Guarantor or other Related Partyany Affiliate of any constituent party or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationeryinvoices, invoices bank accounts and checks.
(kj) Borrower will maintain adequate capital capital, to the extent proceeds are available from the Project, for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or of the sale of material Borrower.
(l) Borrower will not commingle the funds and other assets of BorrowerBorrower with those of any Affiliate or constituent party, any Guarantor, or any Affiliate of any constituent party or Guarantor, or any other Person.
(m) Borrower has and will maintain its assets in such a manner that it will not commingle be costly or difficult to segregate, ascertain or identify its individual assets with from those of any Affiliate or constituent party, any Guarantor, or any Affiliate of any constituent party or Guarantor, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own namePerson.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being to be responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Sources: Leasehold Deed to Secure Debt and Security Agreement (Meredith Enterprises Inc)
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Mortgagor does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(cb) Borrower Mortgagor will not engage in any business other than the ownership, management and operation of the PropertiesMortgaged Property and Mortgagor will conduct and operate its business as presently conducted and operated.
(dc) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate affiliate of Borrowerthe Mortgagor, any constituent party of BorrowerMortgagor, any guarantors guarantor (a "Guarantor") of the obligations of Borrower Debt or any Affiliate part thereof or any affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower Mortgagor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and Debt, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such and (iii) debt is not evidenced by a note, does not exceed $4,000,000.00 incurred in the aggregate, financing of equipment and is not in excess of sixty (60) days past dueother personal property used on the Premises. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property.
(fe) Borrower Mortgagor has not made and will not make any loans or advances to any Person third party (including any affiliate or constituent party, any Guarantor or any affiliate of any constituent party or Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)its affiliates.
(gf) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower Mortgagor has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower Mortgagor will not, nor will Borrower Mortgagor permit any Related Party to, constituent party or Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, certificate of organization, trust or other organizational documents of Borrower Mortgagor or such Related Party constituent party or Guarantor without the prior written consent of LenderMortgagee which consent shall not be unreasonably withheld, conditioned or delayed.
(ih) Borrower Mortgagor will maintain all of its books, records, financial statements and bank accounts separate from those of its affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower Mortgagor will file its own tax returns to the extent unless required otherwise by applicable law; provided. Mortgagor shall maintain its books, howeverrecords, that Borrower’s assets resolutions and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated agreements as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate affiliate of Mortgagor, any constituent party of Mortgagor, any Guarantor or other Related Partyany affiliate of any constituent party or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(kj) Borrower Mortgagor is adequately capitalized and will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower Mortgagor nor any Related Party constituent party will seek effectuate the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or of the sale of material assets of BorrowerMortgagor.
(m1) Borrower Mortgagor will not tot commingle its the funds and other assets of Mortgagor with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accountsaffiliate or constituent party, savings accountsany Guarantor, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts any affiliate of any other Person and does not and will not hold itself out as being responsible for the debts constituent party of Guarantor, or obligations of any other Personperson.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Sources: Mortgage, Assignment of Leases and Rents and Security Agreement (Cedar Income Fund LTD /Md/)
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Mortgagor does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, the Mortgaged Property (as defined in the Arkansas Note), and the Mortgaged Property (as defined in the Arizona Note) (collectively, the "Security Property"), and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesSecurity Property.
(cb) Borrower Mortgagor will not engage in any business other than the ownership, management and operation of the PropertiesSecurity Property and Mortgagor will conduct and operate its business as presently conducted and operated.
(dc) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower Guarantor or any Affiliate of any constituent partyparty which is directly or indirectly controlling, owner controlled by or guarantor under common control with Mortgagor or Guarantor (collectively, the “Related Parties”an "Affiliate"), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower other than any Guarantor or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other PersonAffiliate.
(ed) Borrower ▇▇▇▇▇▇▇▇▇ has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan Debt, the Debt (as defined in the Arkansas Note), and the Debt (as defined in the California Note (collectively, the "Indebtedness"),and (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, and is not in excess of sixty (60) days past due. No Indebtedness indebtedness other than the Debt Indebtedness may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property.
(fe) Borrower Mortgagor has not made and will not make any loans or advances to any Person and shall not acquire obligations or securities of third party, nor to Guarantor, any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties Affiliate or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party of Mortgagor.
(gf) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower Mortgagor has done or caused to be done and will do all things necessary necessary, to observe organizational formalities and preserve its existence, and Borrower Mortgagor will not, nor will Borrower Mortgagor permit any Related Party to, Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower Mortgagor or such Related Party without Guarantor in a manner which would adversely affect the prior written consent of LenderMortgagor's existence as a single-purpose entity.
(ih) Borrower Mortgagor will maintain all of its books, records, financial statements books and records and bank accounts separate from those of its Affiliates and any other Person constituent party of Mortgagor, and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower Mortgagor will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposesreturns.
(ji) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate Affiliate, any constituent party of Mortgagor or other Related Partyany Guarantor).
(j) Mortgagor will preserve and keep in full force and effect its existence, shall correct any known misunderstanding regarding its status as a separate entity, shall conduct good standing and qualification to do business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checksstate in which the Mortgaged Property is located.
(k) Borrower Mortgagor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower Mortgagor nor any Related Party constituent party of Mortgagor will seek the dissolution, dissolution or winding up, liquidation, consolidation or merger in whole or in part, of Mortgagor, nor will Mortgagor merge with or the sale of material assets of Borrowerbe consolidated into any other entity.
(m) Borrower Mortgagor will not commingle its the funds and other assets of Mortgagor with those of any Affiliate, any Guarantor, any constituent party of Mortgagor or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameperson.
(n) Borrower Mortgagor has and will maintain its assets in such a manner that it will not guarantee be costly or become obligated for the debts difficult to segregate, ascertain or identify its individual assets from those of any constituent party of Mortgagor, Affiliate, Guarantor or any other Person and person.
(o) Mortgagor does not and will not hold itself out as being to be responsible for the debts or obligations of any other Person.
person (o) Unless Borrower is a single member limited liability company formed under provided, that the laws foregoing shall not prevent Mortgagor from being and holding itself responsible for expenses incurred or obligations undertaken by the property manager of the State Security Property in respect of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (its duties regarding the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedSecurity Property).
(p) Borrower Mortgagor shall at obtain and maintain in full force and effect, and abide by and satisfy the material terms and conditions of, all times cause there material permits, licenses, registrations and other authorizations with or granted by any governmental authorities that may be required from time to be at least one time with respect to the performance of its obligations under this Mortgage.
(1q) duly appointed members Since the formation of Mortgagor, Mortgagor has not owned any asset, conducted any business or operation, or engaged in any business other than the ownership and operation of the board Security Property. The Mortgagor has no debts or obligations other than normal trade accounts payable in the ordinary course of directors business, and the Indebtedness. Any other indebtedness or obligation of ▇▇▇▇▇▇▇▇▇ has been paid in full prior to or through application of proceeds from funding of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other PersonLoan.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the PropertiesProject, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesProject.
(cb) Borrower will not engage in any business other than the ownership, management and operation of the PropertiesProject and Borrower will conduct and operate its business as presently conducted and operated.
(dc) Borrower will not enter into any contract or agreement with any Affiliate of the Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “Related Parties”), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower has not incurred and will not incur any Indebtedness Debt other than (i) the Loan and Loan, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a notenote and is paid when due, does not exceed $4,000,000.00 and (iii) Debt incurred in the aggregate, financing of equipment and is not in excess of sixty (60) days past dueother personal property used on the Project. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passu) by the PropertiesProject.
(fe) Borrower has not made and will not make any loans or advances to any Person third party (including any affiliate or constituent party or any affiliate of any constituent party), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party.
(gf) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own funds and assets only, and as the same shall become due.
(hg) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, constituent party to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, LOAN AGREEMENT - Page 14 F▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇s./78416 operating agreement, trust or other organizational documents of Borrower or such Related Party constituent party without the prior written consent of Lender.
(ih) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; providedreturns. Borrower shall maintain its books, howeverrecords, that Borrower’s assets resolutions and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated agreements as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate of Borrower, any constituent party of Borrower, or other Related Partyany Affiliate of any constituent party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize a separate telephone number, if any, and separate stationery, invoices and checks.
(kj) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or of the sale of material Borrower.
(l) Borrower will not commingle the funds and other assets of BorrowerBorrower with those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other person.
(m) Borrower has and will maintain its assets in such a manner that it will not commingle be costly or difficult to segregate, ascertain or identify its individual assets with from those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameperson.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being to be responsible for the debts or obligations of any other Personperson.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower represents, ---------------------------------- warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the Properties, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the Properties.
(cb) Borrower will not engage in any business other than the ownership, management and operation of the PropertiesProperties and Borrower will conduct and operate its business as presently conducted and operated.
(dc) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower Guarantor or any Affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower has not incurred and will not incur any Indebtedness Indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan Debt and (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in except pursuant to the aggregate, Guaranty of Payment and is not in excess of sixty (60) days past duethe Cash Management Agreement. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) ---- ----- by the Properties, except pursuant to the Junior Mortgage.
(fe) Borrower has not made and will not make any loans or advances to any Person third party (including any Affiliate or constituent party, any Guarantor or any Affiliate of any constituent party or Guarantor), except pursuant to the Guaranty of Payment or as provided in the Cash Management Agreement, and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)its Affiliates.
(gf) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, SPC Entity to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, certificate of organization, trust or other organizational documents of Borrower or such Related Party SPC Entity in any manner that would affect the status of Borrower or such SPC Entity as a single-purpose, bankruptcy-remote entity, without (i) the prior written consent of Lender, in its sole discretion and, (ii) if a Securitization has occurred, delivery to Lender of a No Downgrade Letter.
(ih) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, (provided that Borrower’s 's financial statements and tax returns may be prepared on a consolidated basis with other entities provided that such consolidated financial statements and tax returns indicate the separate existence of Borrower and its assets and income may be included in a consolidated tax return of liabilities). Borrower shall maintain its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated books, records, resolutions and agreements as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate of Borrower, any constituent party of Borrower, any Guarantor or other Related Partyany Affiliate of any constituent party or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(kj) Borrower is adequately capitalized and will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower nor any Related Party will shall not seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or of Borrower.
(l) Borrower will not commingle the sale of material funds and other assets of BorrowerBorrower with those of any Affiliate or constituent party, any Guarantor, or any Affiliate of any constituent party or Guarantor, or any other Person.
(m) Borrower has and will maintain its assets in such a manner that it will not commingle be costly or difficult to segregate, ascertain or identify its individual assets with from those of any Affiliate or constituent party, any Guarantor, or any Affiliate of any constituent party or Guarantor, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own namePerson.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not guarantee, become obligated for, pledge its assets as security for, or hold itself out as being to be responsible for the debts or obligations of any other Person or the decisions or actions respecting the daily business or affairs of any other Person, except pursuant to the Guaranty of Payment.
(o) Unless If Borrower is a single member limited partnership or a limited liability company formed under company, the laws of general partner or managing member (the State of Delaware, Borrower "SPC ENTITY") shall require that be a Person holding an corporation whose sole asset is its interest in Borrower be a corporation or limited liability company (and the “SPC Party”) which Entity will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 3.1.40 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedEntity.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members member of the board of directors (an "INDEPENDENT DIRECTOR") of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender Entity who shall not have been at the time of each such individual’s respective 's appointment, and shall not be at any time while serving as a Independent Director director of the SPC Entity and may has not have been at any time during the preceding five (5) years (i) a shareholder of, or an officer, directordirector (with the exception of serving as the Independent Director of the SPC Entity), attorney, counsel, partner or employee of, Borrower Borrower, the SPC Entity or any Affiliate of its or their shareholders, subsidiaries or Affiliateseither of them, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or Borrower, the SPC Party (if applicable) Entity or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliatesthem, (iii) a Person controlling or under common control with any such shareholder, partner partner, supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer customer. As used herein, the term "control" means the possession, directly or indirectly, of any other director the power to direct or cause the direction of Borrower the management policies or the SPC Party (if applicable)activities of a Person, whether through ownership of voting securities, by contract or otherwise. Notwithstanding the foregoing, (1) an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director of the SPC Entity if such individual is individual, at or prior to the time of initial appointment, or at any time while serving as an Independent DirectorDirector of the SPC Entity, (i) is an independent director Independent Director of a “"special purpose entity” " affiliated with Borrower. As used in the Borrower or the SPC Entity (for purposes of this clause (p)paragraph, the term “a "special purpose entity” shall mean " is an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve the Borrower's and the SPC Entity's separateness that are substantially similar to those of the Borrower or the SPC Entity, as applicable, and provideprovided, inter alia, that it: it (a) is organized for a the limited purposepurpose of owning and operating one or more properties or being an owner of one or more other entities that are so organized; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition on its own behalf or on behalf of an entity in which it has an ownership interest without the consent of its independent managers or independent directors director; and (d) shall conduct itself and cause any entity in which it has an ownership interest to conduct itself in accordance with certain “"separateness covenants”, ," including, but not limited to, the maintenance of its and such entity's books, records, bank accounts and assets separate from those of any other Personperson or entity), (ii) makes retail purchases of vehicles from dealerships that are affiliates of the SPC Entity or Borrower, or (iii) is employed by a company that provides independent director services to corporations, which company (either directly or through an affiliated entity) provides corporate registration or other services to the SPC Entity, the Borrower or any affiliate of either of them, and (2) the SPC Entity shall be entitled to pay reasonable fees to the Independent Director for his or her services as a director of the SPC Entity.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is Mortgagor has not and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(cb) Borrower will Mortgagor has not and shall not engage in any business or activity other than the acquisition, ownership, management and operation of the PropertiesMortgaged Property and such activities as are necessary, incidental or appropriate in connection therewith, and Mortgagor will conduct and operate its business as presently conducted and operated.
(dc) Borrower will Mortgagor has not and shall not enter into or be a party to any transaction, contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors guarantor of the obligations of Borrower Debt or any Affiliate of part thereof (a "Guarantor") or any constituent partyparty which is directly or indirectly controlling, owner controlled by or guarantor under common control with Mortgagor or Guarantor (collectively, the “Related Parties”an "Affiliate"), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower other than any Guarantor or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other PersonAffiliate.
(ed) Borrower Other than debt owed which shall be discharged and paid upon funding of the loan secured hereby, Mortgagor has not incurred and will shall not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and Debt, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors in connection with owning, operating and maintaining the Mortgaged Property, in such amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a notepromissory note or other security instrument and is not at any time in an aggregate amount in excess of two percent (2%) of the original loan amount evidenced by the Note, and further provided that all such trade debts are paid within thirty (30) days after the same are incurred and (iii) unsecured subordinated loans to Mortgagor (the "Subordinated Loans", each a "Subordinated Loan") made by Ramco-Gershenson Properties, L.P., a Delaware limited partnership (the "Pa▇▇▇▇▇▇▇▇▇"), provided that such loan or loans are
(1) the payment terms of each Subordinate Loan shall not require payments to be made or payments to become due unless and until the Loan (or any refinancing loan the proceeds of which are used to repay the Loan) is fully paid and satisfied, except that voluntary payments by Mortgagor from excess cash flow from the Mortgaged Property may be permitted so long as no (x) Event of Default or (y) Cash Management Event (as hereinafter defined) has occurred and is continuing, (2) the aggregate outstanding balance of the Subordinated Loans and interest accrued and unpaid thereon together with the Debt (the "Total Debt Amount") shall not exceed 80% of the value of the Mortgaged Property (such value to be determined at the time each such Subordinated Loan is made and to be determined based on an appraisal similar to the appraisal obtained at loan origination and otherwise in form and substance reasonably acceptable to Mortgagee, such appraisal also to take account of any increase in value created by any related expansion or remodeling; provided, however, that if the Total Debt Amount does not exceed 80% of $4,000,000.00 18,650,000.00, a new appraisal will not be required) and (3) the Partnership shall, prior to making any Subordinate Loan advance, execute and deliver to and for the benefit of Mortgagee a subordination and standstill agreement in the aggregateform of Exhibit E attached to that certain Closing Certificate dated as of the date hereof, executed by Mortgagor for the benefit of Mortgagee (the "Closing Certificate"), and is (4) all reasonable costs and expenses incurred by Mortgagee in connection with such Subordinated Loans, including, but not limited to, the review of any and all materials required to be provided in excess connection therewith (including Mortgagee's reasonable attorney's fees and expenses) shall be at the expense of sixty (60) days past dueMortgagor and shall be paid by Mortgagor to Mortgagee upon demand. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property.
(fe) Borrower Mortgagor has not made and will shall not make any loans or advances to any Person and shall not acquire obligations or securities of third party, nor to Guarantor, any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties Affiliate or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party of Mortgagor.
(gf) Borrower Without intending to modify or diminish any limitations on recourse benefiting Mortgagor under this Mortgage or the other Loan Documents, Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party without the prior written consent of Lender.
(i) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposes.
(j) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person (including any Affiliate or other Related Party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(k) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower.
(m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the Properties, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the Properties.
(c) Borrower will not engage in any business other than the ownership, management and operation of the Properties.
(d) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “Related Parties”"RELATED PARTIES"), except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or such Related Parties. Borrower will maintain an arm’s 's length relationship with such Related Parties or any other Person.
(e) Borrower has not incurred and will not incur any Indebtedness other than (i) the Loan and (ii) trade payables in the ordinary course of business with trade creditors in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 3,500,000.00 in the aggregate, and is not in excess of sixty (60) days past due. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the Properties.
(f) Borrower has not made and will not make any loans or advances to any Person and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents).
(g) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party without the prior written consent of Lender.
(i) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person and Borrower’s 's assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s 's assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s 's being treated as a disregarded entity for Federal income tax purposes.
(j) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person (including any Affiliate or other Related Party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(k) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower.
(m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “"SPC Party”PARTY") which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “"single purpose, bankruptcy remote entities”". Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one two (12) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (each an “Independent Director”"INDEPENDENT DIRECTOR") reasonably satisfactory to Lender who shall not have been at the time of each such individual’s 's respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “"special purpose entity” " affiliated with Borrower. As used in this clause (p), the term “"special purpose entity” " shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “"separateness covenants”", including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Sources: Loan Agreement (U-Store-It Trust)
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Mortgagor does not own and will not own any encumbered asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(cb) Borrower Mortgagor will not engage in any business other than the ownership, management and operation of the PropertiesMortgaged Property and Mortgagor will conduct and operate its business as presently conducted and operated.
(dc) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate affiliate of Borrowerthe Mortgagor, any constituent party of BorrowerMortgagor, any guarantors guarantor (a "Guarantor") of the obligations of Borrower Debt or any Affiliate part thereof or any affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower Mortgagor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and Debt, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such and (iii) debt is not evidenced by a note, does not exceed $4,000,000.00 incurred in the aggregate, financing of equipment and is not in excess of sixty (60) days past dueother personal property used on the Premises. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari @pari passu) by the PropertiesMortgaged Property.
(fe) Borrower Mortgagor has not made and will not make any loans or advances to any Person and shall not acquire obligations third party (including any affiliate or securities constituent party, any Guarantor or any affiliate of any Related Party. Borrower will not form, acquire constituent party or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan DocumentsGuarantor).
(gf) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel including employment and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower Mortgagor has done or caused to be done and will do all things necessary to observe organizational corporate formalities and preserve its existence, and Borrower Mortgagor will not, nor will Borrower Mortgagor permit any Related Party to, constituent party or Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower Mortgagor or such Related Party without constituent party or Guarantor in a manner which would adversely affect the prior written consent of LenderMortgagor's existence as a single purpose entity.
(ih) Borrower Mortgagor will maintain all of its books, records, financial statements books and records and bank accounts separate from those of its affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower Mortgagor will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposesreturns.
(ji) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate affiliate of Mortgagor, any constituent party of Mortgagor, any Guarantor or other Related Partyany affiliate of any constituent party or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(kj) Borrower Mortgagor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower Mortgagor nor any Related Party constituent party will seek the dissolution, dissolution or winding up, liquidation, consolidation or merger in whole or in part, or of the sale of material Mortgagor.
(l) Mortgagor will not commingle the funds and other assets of BorrowerMortgagor with those of any affiliate or constituent party, any Guarantor, or any affiliate of any constituent party or Guarantor, or any other person.
(m) Borrower Mortgagor has and will maintain its assets in such a manner that it will not commingle be costly or difficult to segregate, ascertain or identify its individual assets with from those of any affiliate or constituent party, any Guarantor, or any affiliate of any constituent party or Guarantor, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameperson.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and Mortgagor does not and will not hold itself out as being to be responsible for the debts or obligations of any other Personperson.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Sources: Mortgage, Assignment of Leases and Rents and Security Agreement (Ridgewood Properties Inc)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Each Borrower does not own and will not own any asset or property other than (i) the Propertiesapplicable Project, and (ii) incidental personal property Personal Property necessary for and used or to be used in connection with the ownership or operation of the Properties.
(c) applicable Project. Each Borrower will not engage in any business other than the ownership, management and operation of the Properties.
(d) applicable Project and such Borrower will not continue to conduct and operate its business (i.e., renting its Project to On Stage Theaters, Inc. for the purpose of operating a dinner theater live production show) as presently conducted and operated. Other than the applicable On Stage Lease, no Borrower will enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors of the obligations Affiliated Parties of Borrower or any Affiliate of any constituent partyexcept if such Affiliated Parties have the requisite skills therefor, owner or guarantor (collectively, the “Related Parties”), except and then only upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Partiesparty. Borrower will maintain an arm’s length relationship with such Related Parties or any other Person.
(e) No Borrower has not incurred and will not incur any Indebtedness other than (i) the Loan and (ii) trade payables in the ordinary course of business with trade creditors in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, and is not in excess of sixty (60) days past due. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the Properties.
(f) Borrower has not made and will not make any loans or advances to any Person third party (including any Affiliated Parties), and shall not acquire obligations or securities of any Related Partyits Affiliated Parties. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents).
(g) Each Borrower is and will remain solvent solvent, and each Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party without the prior written consent of Lender.
(i) . Each Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person its Affiliated Parties and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. each Borrower will file its own tax returns to returns, unless such Borrower is included within the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return returns of OSE. Each Borrower shall maintain its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated books, records, resolutions and agreements as a disregarded entity for Federal income tax purposes.
(j) official records. Each Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from ncluding any other Person (including any Affiliate or other Related Party), Affiliated Parties of such Borrower) shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates Affiliated Parties as a division or part of the other (except as subsidiaries of OSE) and shall maintain and utilize a separate stationery, telephone number and separate invoices and checks.
(k) . Each Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make . Neither any additional capital contributions to Borrower.
(l) Neither Borrower nor any Related Party Affiliated Parties of any Borrower will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or of such Borrower. No Borrower will commingle the sale of material funds and other assets of Borrower.
(m) such Borrower will not commingle its assets with those of any Affiliated Parties or any other Person person. Each Borrower has and will hold all of maintain its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower a manner that it will not guarantee be costly or become obligated for the debts difficult to segregate, ascertain or identify its individual assets from those of any Affiliatd Parties or any other Person and person. Each Borrower does not and will not hold itself out as being to be responsible for the debts or obligations of any other Personperson.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower representsEach Mortgagor represents and warrants severally as to itself only, warrants and not jointly and severally as to any other Mortgagor, to Mortgagee and covenants with Mortgagee as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Mortgagor does not own and will not own own, and since the date of its formation has not owned, any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(cb) Borrower Mortgagor will not engage engage, and since the date of its fonuation has not engaged, in any business other than the ownership, management and operation of the PropertiesMortgaged Property and Mortgagor will conduct and operate its business as presently conducted and operated.
(dc) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower Guarantor or any Affiliate of any constituent party, owner Mortgagor or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower Mortgagor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and Debt, (ii) unsecured trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided circumstances and such debt is not evidenced by a notepromissory note executed by Mortgagor, does not exceed $4,000,000.00 (iii) debt incurred in the aggregateordinary course of Mortgagor's business to finance equipment and other personal property used on the Premises the removal of which would not materially damage the Improvements or materially impair the value of the Improvements, provided that such debt is not evidenced by a promissory note executed by Mortgagor and is not in excess secured by any property other than the item of sixty equipment or personal property so financed; and (60iv) days past duepayment of the preferred equity permitted under Subparagraph (2) above. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari pan passu) by the PropertiesMortgaged Property.
(fe) Borrower Mortgagor has not made and will not make any loans or advances to any Person third party (including Guarantor and any Affiliate of Mortgagor or Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties Guarantor or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)Affiliate of Mortgagor or Guarantor.
(gf) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower Mortgagor has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, good standing and Borrower right to do business in the state where it is organized or registered and in the state where the Premises are located, and Mortgagor will not, nor and will Borrower not permit any Related Party toits Governing Entity, to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylawsorganization, operating agreement, trust or other organizational documents of Borrower Mortgagor or such Related Party the Governing Entity that would either amend or modify the terms of the preferred equity referred to in Paragraph 8(g) above or cause Mortgagor or the Governing Entity to be violation of any other provision of this Paragraph 9, without the prior written consent of LenderMortgagee, which consent will not be unreasonably withheld, delayed or conditioned.
(ih) Borrower Mortgagor will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person Guarantor and Borrower’s assets will not be listed as assets on the financial statement Affiliates of any other Person except as otherwise required in accordance with GAAP. Borrower Mortgagor and Guarantor, and Mortgagor will file its own tax returns to the extent required by applicable law; provided, however, (except that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return as long as Mortgagor
is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal United States federal income tax purposes Mortgagor will be shown as a separate member of the consolidated group of which Mortgagor is a part for United States federal income tax purposes). Mortgagor shall maintain its books, records, resolutions and agreements as official records.
(ji) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person person (including Guarantor and any Affiliate or other Related Partyof Mortgagor and Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(kj) Borrower Mortgagor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower Mortgagor, Guarantor nor any Related Party the Governing Entity will seek the dissolution, winding up, liquidation, consolidation or merger merger, in whole or in part, of Mortgagor or the sale of material assets of Borrowersuch Governing Entity.
(m1) Borrower Mortgagor will not commingle its the funds and other assets of Mortgagor with those of Guarantor or any other Person and will hold all Affiliate of its assets in its own name. Borrower will deposit all of its funds in checking accountsMortgagor or Guarantor, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Sources: Mortgage (American Realty Capital Healthcare Trust Inc)
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower the Mortgagor is organized is and shall be limited solely to (iA) owning, holding, selling, leasing, transferring, exchanging, operating and managing the PropertiesMortgaged Property, (iiB) entering into this Agreement the Loan with Lenderthe Mortgagee, (iiiC) refinancing the Properties Mortgaged Property in connection with a permitted repayment of the Loan Loan, and (ivD) transacting any and all lawful business for which a Borrower Mortgagor may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Mortgagor does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(c) Borrower Mortgagor will not engage in any business other than the ownership, management and operation of the PropertiesMortgaged Property.
(d) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate affiliate of BorrowerMortgagor, any constituent party of BorrowerMortgagor, any guarantors owner of the obligations of Borrower Mortgagor, the Guarantors (as hereinafter defined) or any Affiliate affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties the Mortgagor or any other Personconstituent party of Mortgagor or any owner of Mortgagor.
(e) Borrower Mortgagor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, other than the Loan and debt (i) the Loan and (ii) trade payables incurred in the ordinary course of business with trade creditors in amounts as are normal to vendors and reasonable under suppliers of services to the circumstancesMortgaged Property, provided such debt is (ii) not evidenced secured by a notethe Mortgaged Property, does not exceed $4,000,000.00 or any portion thereof, or by interests in the aggregateMortgagor or any constituent entity thereof, and is (iii) not in excess accompanied by any rights to control or to obtain control of sixty (60) days past duethe Mortgagor or any constituent entity thereof. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passuPARI PASSU) by the PropertiesMortgaged Property, or any portion thereof, or by interests in the Mortgagor or any constituent entity thereof.
(f) Borrower Mortgagor has not made and will not make any loans or advances to any Person entity or person (including any affiliate or any constituent party of Mortgagor or any owner of Mortgagor, any Guarantor or any affiliate of any constituent party or Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the constituent party. Loan Documents).No. 6518291
(g) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower Mortgagor has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower Mortgagor will not, nor will Borrower Mortgagor permit any Related Party to, constituent party of Mortgagor or any owner of Mortgagor or any Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower Mortgagor or such Related Party constituent party or Guarantor without the prior written consent of LenderMortgagee.
(i) Borrower Mortgagor will maintain all of its books, records, records and financial statements and bank accounts separate from those of its affiliates and any other Person and Borrower’s constituent party. Mortgagor's assets will not be listed as assets on the financial statement of any other Person entity except the ownership interests in Mortgagor may be listed as otherwise required in accordance with GAAPassets on the financial statements of the Trust. Borrower will file Mortgagor shall have its own tax returns to the extent required by applicable law; separate financial statement, provided, however, that Borrower’s Mortgagor's assets and income may be included in a consolidated tax return financial statement of its parent companies if inclusion on such a consolidated tax return statement is required to comply with the requirements of applicable generally accepted accounting principles ("GAAP"), provided that such consolidated financial statement shall contain a footnote to the effect that Mortgagor's assets are owned by Mortgagor and that they are being included on the financial statement of its parent solely to comply with the requirements of GAAP, and further provided that such assets shall be listed on Mortgagor's own separate balance sheet. Mortgagor will file its own tax returns if required by law or by reason and will not file a consolidated federal income tax return with any other corporation except the Trust in which case Mortgagor will be shown on a separate schedule of Borrower’s being treated such return as a disregarded entity for Federal income tax purposesseparate member of the consolidated group with its delineated financial information. Mortgagor shall maintain its books, records, resolutions and agreements as official records.
(j) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate affiliate of Mortgagor, any constituent party of Mortgagor, any Guarantor or other Related Partyany affiliate of any constituent party or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates affiliates as a division or part of the other except the Trust and shall maintain and utilize separate telephone numbers, stationery, invoices and checks.
(k) Borrower Mortgagor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower Mortgagor nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger merger, in whole or in part, or the sale of material assets of BorrowerMortgagor.
(m) Borrower Mortgagor will not commingle the funds and other assets of Mortgagor with those of any affiliate or any constituent party of Mortgagor or any owner of Loan No. 6518291 Mortgagor, any Guarantor, or any affiliate of any constituent party or Guarantor, or any other person, except for the Manager, and will not participate in a cash management system with any such party.
(n) Mortgagor will not commingle its assets with those of any other Person person or entity except the Manager and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits name or certificate deposits in its own name or invest such funds in its own agent's name.
(no) Borrower Mortgagor will not guarantee or become obligated for the debts of any other Person entity or person and does not and will not hold itself out as being responsible for the debts or obligations of any other Personperson.
(op) Unless Borrower If Mortgagor is a single member limited partnership or a limited liability company formed under the laws of the State of Delawarecompany, Borrower at least one general partner or member (an "SPC PARTY") shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “whose sole asset is its interest in Mortgagor, and each such SPC Party”) which Party will at all times comply, and will shall cause Borrower Mortgagor to comply, with each of the representations, warranties, warranties and covenants contained in this Section 4.1.30 PARAGRAPH 19 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and SPC Party; or in the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purposealternative, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower if Mortgagor is a single member limited liability company formed organized under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are which does not modified, Borrower shall not be required to have an SPC Party as one of its members, then Mortgagor shall have an independent manager and all provisions of this Agreement and Mortgagor shall cause to be delivered to Mortgagee such legal opinions with respect thereto from Delaware counsel reasonably satisfactory to Mortgagee that address such matters as may be required by Mortgagee or the other Loan Documents pertaining to SPC Party shall be disregardedRating Agencies at such time.
(pq) Borrower Mortgagor shall at all times cause there to be at least one (1) duly appointed members member of the board of directors (an "INDEPENDENT DIRECTOR") of Mortgagor, in the case of a corporation, and each SPC Party in Mortgagor in the case of a limited partnership or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) in each case reasonably satisfactory to Lender Mortgagee who shall is not have been at the time of each such individual’s respective initial appointment, and shall has not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i5) a shareholder of, or an officeryears: (a) stockholder, director, partner officer, employee, partner, attorney or employee ofcounsel of the SPC Party, Borrower the Mortgagor or any affiliate of its or their shareholders, subsidiaries or Affiliates, either of them; (iib) a customer ofcustomer, supplier or supplier to, or other person who derives any more than ten percent (10%) of its purchases or revenues from its activities with Borrower or the SPC Party (if applicable) Party, the Mortgagor or any Affiliate affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, them; (iiic) a Person person or other entity controlling or under common control with any such shareholderstockholder, partner partner, customer, supplier or customer, other person; or (ivd) a member of the immediate family of any such shareholderstockholder, director, officer, directoremployee, partner, employeecustomer, supplier or customer other person. As used herein, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of management, policies or activities of a person or entity, whether through ownership of voting securities, by contract or otherwise.
(r) Mortgagor shall not cause or permit the board of directors of any other director of Borrower or the SPC Party (if applicable). Notwithstanding in Mortgagor to take any action which, under the foregoingterms of any certificate of incorporation, an individual that otherwise satisfies by-laws or any voting trust agreement with respect to any common stock, requires the foregoing shall not be disqualified from serving as an Independent Director if such individual is vote of each SPC Party in Mortgagor unless at the time of initial appointment, or such action there shall be at any time while serving as least one member who is an Independent Director. Loan No. 6518291
(s) Mortgagor shall conduct its business so that the assumptions made with respect to Mortgagor in that certain opinion letter dated April __, an independent director of a “special purpose entity” affiliated 2004 (the "Non-Consolidation Opinion") delivered by Levenfeld ▇▇▇▇▇▇▇▇▇▇ in connection with Borrower. As used the Loan shall be true and correct in this clause all respects.
(p), the term “special purpose entity” t) Mortgagor shall mean an entity whose organizational documents contain restrictions on its activities allocate fairly and impose requirements intended to preserve separateness reasonably any overhead expenses that are substantially similar shared with an affiliate, including paying for office space and services performed by any employee of an affiliate.
(u) The stationery, invoices and checks utilized by Mortgagor or utilized to those of Borrower collect its funds or pay its expenses shall bear its own name and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may shall not file voluntarily a bankruptcy petition without bear the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those name of any other Personentity unless such entity is clearly designated as being Mortgagor's agent.
(v) Mortgagor shall not pledge its assets for the benefit of any other person or entity, and other than with respect to the Loan.
(w) Mortgagor shall correct any known misunderstanding regarding its separate identity.
(x) Mortgagor shall not identify itself as a division of any other person or entity except for the Trust or Partnership.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owninghas not owned, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own own, and will not own any asset or property other than (i) the PropertiesProjects, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesProjects.
(cb) Borrower will not engage in any business other than the ownership, management and operation of the PropertiesProjects and Borrower will conduct and operate its business as presently conducted and operated.
(dc) Borrower will not enter into any contract or agreement with any Affiliate of the Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “Related Parties”), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower has not incurred and will not incur any Indebtedness Debt other than (i) the Loan and Loan, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a notenote and is paid when due, does not exceed $4,000,000.00 and (iii) Debt incurred in the aggregate, financing of equipment and is not in excess of sixty (60) days past dueother personal property used on the Projects. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passu) by the Propertiesany Project.
(fe) Borrower has not made and will not make any loans or advances to any Person third party (including any Affiliate or constituent party or any Affiliate of any constituent party), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its Affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party.
(gf) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own funds and assets only, and as the same shall become due.
(hg) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, constituent party to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party constituent party without the prior written consent of Lender.
(ih) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns returns, if any, as may be required under applicable law, to the extent not part of a consolidated group filing a consolidated return, and pay any taxes so required by to be paid under applicable law; provided. Borrower shall maintain its books, howeverrecords, that Borrower’s assets resolutions and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated agreements as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate of Borrower, any constituent party of Borrower, or other Related Partyany Affiliate of any constituent party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize a separate telephone number, if any, and separate stationery, invoices and checks.
(kj) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or of the sale of material Borrower.
(1) Borrower will not commingle the funds and other assets of BorrowerBorrower with those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other Person.
(m) Borrower has and will maintain its assets in such a manner that it will not commingle be costly or difficult to segregate, ascertain or identify its individual assets with from those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own namePerson.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being to be responsible for the debts or obligations of any other Person.
(o) Unless If Borrower is a single member limited partnership or a limited liability company formed under the laws of the State of Delawarecompany, Borrower shall require that a Person holding each general partner or managing member (each, an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which shall be a limited liability company whose sole asset is its interest in Borrower and each such SPC Party will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 6.14 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedParty.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers special manager (an “Independent Director”) reasonably satisfactory to Lender of each SPC Party in Borrower who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner partner, member, or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) affiliated with a customer of, or supplier to, the SPC Party, Borrower or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, or (iii) a spouse, parent, sibling, child, or other family relative of any person described by (i) or (ii) above. As used herein, the term “Affiliate” means any Person controlling other than the SPC Party (A) which owns beneficially, directly or indirectly, any outstanding shares of the SPC Party’s stock or interest in the Borrower or (B) which controls or is under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding or the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p)herein, the term “special purpose entitycontrol” shall mean an entity whose organizational documents contain restrictions on its activities means the possession, directly or indirectly, of the power to direct or cause the direction of the management and impose requirements intended to preserve separateness that are substantially similar to those policies of Borrower and providea Person, inter aliawhether through ownership of voting securities, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers by contract or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Personotherwise.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Mortgagor does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(cb) Borrower Mortgagor will not engage in any business other than the ownership, management and operation of the PropertiesMortgaged Property and Mortgagor will conduct and operate its business as presently conducted and operated.
(dc) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate of Guarantor or any party which is directly or indirectly controlling, controlled by or under common control with Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower Mortgagor or any Affiliate of any constituent party, owner or guarantor Guarantor (collectively, the “Related Parties”an "Affiliate"), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower other than any Guarantor or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other PersonAffiliate.
(ed) Borrower Mortgagor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and Debt, (ii) the Related Debt (hereinafter defined) and (iii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, and is not in excess of sixty (60) days past due. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property.
(fe) Borrower Mortgagor has not made and will not make any loans or advances to any Person and shall not acquire obligations or securities of third party, nor to Guarantor, any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties Affiliate or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party of Mortgagor.
(gf) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower Mortgagor has done or caused to be done and will do all things necessary necessary, to observe organizational formalities and preserve its existence, and Borrower Mortgagor will not, nor will Borrower Mortgagor permit any Related Party to, Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, trust, certificate of organization, operating agreement, trust agreement or other organizational documents of Borrower Mortgagor or such Related Party without Guarantor in a manner which would adversely affect the prior written consent of LenderMortgagor's existence as a single-purpose entity.
(ih) Borrower Mortgagor will maintain all of its books, records, financial statements books and records and bank accounts separate from those of its Affiliates and any other Person constituent party of Mortgagor, and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower Mortgagor will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposesreturns.
(ji) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate Affiliate, any constituent party of Mortgagor or other Related Partyany Guarantor).
(j) Mortgagor will preserve and keep in full force and effect its existence, shall correct any known misunderstanding regarding its status as a separate entity, shall conduct good standing and qualification to do business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checksstate in which the Mortgaged Property is located.
(k) Borrower Mortgagor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower Mortgagor nor any Related Party constituent party of Mortgagor will seek the dissolution, dissolution or winding up, liquidation, consolidation or merger in whole or in part, of Mortgagor, nor will Mortgagor merge with or the sale of material assets of Borrowerbe consolidated into any other entity.
(m) Borrower Mortgagor will not commingle its the funds and other assets of Mortgagor with those of any Affiliate, any Guarantor, any constituent party of Mortgagor or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameperson.
(n) Borrower Mortgagor has and will maintain its assets in such a manner that it will not guarantee be costly or become obligated for the debts difficult to segregate, ascertain or identify its individual assets from those of any constituent party of Mortgagor, Affiliate, Guarantor or any other Person and person.
(o) Mortgagor does not and will not hold itself out as being to be responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed person other than the obligors under the laws Related Debt (provided, that the foregoing shall not prevent Mortgagor from being and holding itself responsible for expenses incurred or obligations undertaken by the property manager of the State Mortgaged Property in respect of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (its duties regarding the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedMortgaged Property).
(p) Borrower Mortgagor shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointmentobtain and maintain in full force and effect, and shall not be at any time while serving as a Independent Director abide by and may not have been at any time during satisfy the preceding five years (i) a shareholder material terms and conditions of, all material permits, licenses, registrations and other authorizations with or an officer, director, partner or employee of, Borrower or granted by any governmental authorities that may be required from time to time with respect to the performance of its or their shareholdersobligations under this Mortgage.
(q) Mortgagor will use separate checks, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities invoices and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Personstationery.
Appears in 1 contract
Sources: Mortgage and Security Agreement (Janus American Group Inc)
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and Mortgagor shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(cb) Borrower will Mortgagor shall not engage in any business or activity other than the ownership, management and operation of the PropertiesMortgaged Property and such activities as are necessary, incidental or appropriate in connection therewith, and Mortgagor will conduct and operate its business as presently conducted and operated.
(dc) Borrower will Mortgagor shall not enter into or be a party to any transaction, contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors guarantor of the obligations of Borrower Debt or any Affiliate of part thereof (a "Guarantor") or any constituent partyparty which is directly or indirectly controlling, owner controlled by or guarantor under common control with Mortgagor or Guarantor (collectively, the “Related Parties”an "Affiliate"), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower other than any Guarantor or such Related PartiesAffiliate. Borrower will maintain an arm’s length relationship with such Related Parties or appropriately document and accurately record on its books and records all contracts, business transactions and transfers between Borrower, on the one hand, and any other Personof Ramco-▇▇▇▇▇▇▇▇▇▇ Properties, L.P., a Delaware limited partnership (the "Partnership"), Ramco-▇▇▇▇▇▇▇▇▇▇, Inc., a Michigan corporation ("RG, Inc."), and/or the REIT (as defined in Section 12 below), on the other.
(ed) Borrower has not incurred Other than debt owed which shall be discharged and will paid upon funding of the loan secured hereby, Mortgagor shall not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and Debt; (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors in connection with owning, operating and maintaining the Mortgaged Property, in such amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a notepromissory note or other security instrument and is not at any time in an aggregate amount in excess of two percent (2%) of the original loan amount evidenced by the Note and further provided that all such trade debts are paid within thirty (30) days after the same are incurred; and (iii) unsecured subordinated loans to Mortgagor (the "Subordinated Loans", each a "Subordinated Loan") made by the Partnership, provided that such loan or loans are made for the sole purpose of funding, and are used by Mortgagor solely for, working capital and/or otherwise to improve, alter and remodel the Mortgaged Property and provided that Mortgagee consents to such improvement, alteration or remodeling, as applicable, such consent not to be unreasonably withheld; provided, however, that Subordinated Loans shall be permitted only if and so long as each of the following conditions are satisfied:
(1) the payment terms of each Subordinate Loan shall not require payments to be made or payments to become due unless and until the Loan (or any refinancing loan the proceeds of which are used to repay the Loan) is fully paid and satisfied, except that voluntary payments by Mortgagor from excess cash flow from the Mortgaged Property may be permitted so long as no Event of Default has occurred and is continuing, (2) the aggregate outstanding balance of the Subordinated Loans and interest accrued and unpaid thereon together with the Debt (the "Total Debt Amount") shall not exceed 80% of the value of the Mortgaged Property (such value to be determined at the time each such Subordinated Loan is made and to be determined based on an appraisal similar to the appraisal obtained at loan origination and otherwise in form and substance reasonably acceptable to Mortgagee, such appraisal also to take account of any increase in value created by any related expansion or remodeling; provided, however, that if the Total Debt Amount does not exceed 80% of $4,000,000.00 32,600,000, a new appraisal will not be required) and (3) the Partnership shall, prior to making any Subordinate Loan advance, execute and deliver to and for the benefit of Mortgagee a subordination and standstill agreement in the aggregateform of Exhibit E attached to that certain Closing Certificate dated as of the date hereof, executed by Mortgagor for the benefit of Mortgagee (the "Closing Certificate"), and is (4) all reasonable costs and expenses incurred by Mortgagee in connection with such Subordinated Loans, including, but not limited to, the review of any and all materials required to be provided in excess connection therewith (including Mortgagee's reasonable attorney's fees and expenses) shall be at the expense of sixty (60) days past dueMortgagor and shall be paid by Mortgagor to Mortgagee upon demand. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property.
(fe) Borrower has not made and will Mortgagor shall not make any loans or advances to any Person and shall not acquire obligations or securities of third party, nor to Guarantor, any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties Affiliate or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party of Mortgagor.
(gf) Borrower is and Without intending to modify or diminish any limitations on recourse benefiting Mortgagor under this Mortgage or the other Loan Documents, Mortgagor will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower has done or caused to be done and will Mortgagor shall do all things necessary necessary, to observe organizational formalities and preserve its existence, and Borrower Mortgagor will not, nor will Borrower Mortgagor permit any Related Party to, Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, certificate of formation, operating agreement, trust or other organizational documents of Borrower Mortgagor or such Related Party Guarantor in a manner which would adversely affect Mortgagor's existence as a single-purpose entity, without the prior written consent of LenderMortgagee.
(h) Mortgagor shall maintain financial statements, accounting records, books and records, bank accounts and other entity documents separate from those of its Affiliates and any constituent party of Mortgagor or any other person or entity, and Mortgagor shall file its own tax returns, if any, as may be required under applicable law, or if part of a consolidated group filing, the Mortgagor is shown as a separate member of such group. Mortgagor shall maintain its books, records, resolutions and agreements as official records.
(i) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposes.
(j) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate Affiliate, any constituent party of Mortgagor or other Related Partyany Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks. Mortgagor shall allocate fairly and reasonably any overhead for shared office space.
(j) Mortgagor shall preserve and keep in full force and effect its existence, good standing and qualification to do business in the state in which the Mortgaged Property is located and Mortgagor will observe all partnership, corporate or limited liability company formalities, as applicable.
(k) Borrower will Mortgagor shall maintain adequate capital and a sufficient number of employees, if any, for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party . Mortgagor will pay the salaries of Borrower shall be required to make any additional capital contributions to Borrowerits own employees.
(l) Neither Borrower Mortgagor nor any Related Party will constituent party of Mortgagor shall seek or consent to the dissolution, dissolution or winding up, liquidation, consolidation or merger in whole or in part, of Mortgagor, nor will Mortgagor merge with or be consolidated into any other entity or acquire by purchase or otherwise all or substantially all of the sale business assets of, or any stock of material assets of Borrowerbeneficial ownership of, any entity.
(m) Borrower will Mortgagor shall not commingle its the funds and other assets of Mortgagor with those of any Affiliate, any Guarantor, any constituent party of Mortgagor or any other Person person, and Mortgagor will hold all pay its own liabilities out of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameand assets.
(n) Borrower Mortgagor shall maintain its assets in such a manner that it will not guarantee be costly or difficult to segregate, ascertain or identify its individual assets from those of any constituent party of Mortgagor, Affiliate, Guarantor or any other person.
(o) Mortgagor shall not assume, guarantee, become obligated for the debts of any other Person and does not and will not or hold itself out as being to be responsible for the debts or obligations of any other Personperson (provided, that the foregoing shall not prevent Mortgagor from being and holding itself responsible for expenses incurred or obligations undertaken by the property manager of the Mortgaged Property in respect of its duties regarding the Mortgaged Property).
(op) Unless Borrower is a single member limited liability company formed Mortgagor shall obtain and maintain in full force and effect, and abide by and satisfy the material terms and conditions of, all material permits, licenses, registrations and other authorizations with or granted by any governmental authorities that may be required from time to time with respect to the performance of its obligations under this Mortgage.
(q) Mortgagor shall not own any subsidiary, or make any investment in any person or entity.
(r) Mortgagor shall not without the laws unanimous consent of all its general partners, directors or members, as applicable, file or consent to the State filing of Delawareany petition, Borrower either voluntary or involuntary, to take advantage of any applicable insolvency, bankruptcy, liquidation or reorganization statute, or make an assignment for the benefit of creditors.
(s) Mortgagor shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members member (the "Single Member"), whose certificate of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers formation and operating agreement (an “Independent Director”"Mortgagor's Organizational Documents") shall be in form and substance reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other PersonMortgagee.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower representsEach Mortgagor represents and warrants severally as to itself only, warrants and not jointly and severally as to any other Mortgagor, to Mortgagee and covenants with Mortgagee as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Mortgagor does not own and will not own own, and since the date of its formation has not owned, any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(cb) Borrower Mortgagor will not engage engage, and since the date of its formation has not engaged, in any business other than the ownership, management and operation of the PropertiesMortgaged Property and Mortgagor will conduct and operate its business as presently conducted and operated.
(dc) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower Guarantor or any Affiliate of any constituent party, owner Mortgagor or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an armsainis-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower Mortgagor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and Debt, (ii) unsecured trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided circumstances and such debt is not evidenced by a notepromissory note executed by Mortgagor, does not exceed $4,000,000.00 (iii) debt incurred in the aggregateordinary course of Mortgagor's business to finance equipment and other personal property used on the Premises the removal of which would not materially damage the Improvements or materially impair the value of the Improvements, provided that such debt is not evidenced by a promissory note executed by Mortgagor and is not in excess secured by any property other than the item of sixty equipment or personal property so financed; and (60iv) days past duepayment of the preferred equity permitted under Subparagraph (g) above. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property.
(fe) Borrower Mortgagor has not made and will not make any loans or advances to any Person third party (including Guarantor and any Affiliate of Mortgagor or Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties Guarantor or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)Affiliate of Mortgagor or Guarantor.
(gf) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower Mortgagor has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, good standing and Borrower right to do business in the state where it is organized or registered and in the state where the Premises are located, and Mortgagor will not, nor and will Borrower permit any Related Party tonot peitilit its Governing Entity, to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylawsorganization, operating agreement, trust or other organizational documents of Borrower Mortgagor or such Related Party the Governing Entity that would either amend or modify the terms of the preferred equity referred to in Paragraph 8(0 above or cause Mortgagor or the Governing Entity to be violation of any other provision of this Paragraph 9, without the prior written consent of LenderMortgagee, which consent will not be unreasonably withheld, delayed or conditioned.
(ih) Borrower Mortgagor will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person Guarantor and Borrower’s assets will not be listed as assets on the financial statement Affiliates of any other Person except as otherwise required in accordance with GAAP. Borrower Mortgagor and Guarantor, and Mortgagor will file its own tax returns to the extent required by applicable law; provided, however, (except that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return as long as Mortgagor is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal United States federal income tax purposes Mortgagor will be shown as a separate member of the consolidated group of which Mortgagor is a part for United States federal income tax purposes). Mortgagor shall maintain its books, records, resolutions and agreements as official records.
(ji) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person person (including Guarantor and any Affiliate or other Related Partyof Mortgagor and Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(k) Borrower . Mortgagor will maintain adequate capital for the normal nomial obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower.
(m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Sources: Mortgage Agreement (American Realty Capital Healthcare Trust Inc)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owninghas not owned, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own own, and will not own any asset or property other than (i) the PropertiesProject, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesProject.
(cb) Borrower will not engage in any business other than the ownership, management and operation of the PropertiesProject and Borrower will conduct and operate its business as presently conducted and operated.
(dc) Borrower will not enter into any contract or agreement with any Affiliate of the Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “Related Parties”), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower has not incurred and will not incur any Indebtedness Debt other than (i) the Loan and Loan, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a notenote and is paid when due, does not exceed $4,000,000.00 and (iii) Debt incurred in the aggregate, financing of equipment and is not in excess of sixty (60) days past dueother personal property used on the Project. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passu) by the PropertiesProject.
(fe) Borrower has not made and will not make any loans or advances to any Person third party (including any affiliate or constituent party or any affiliate of any constituent party), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party.
(gf) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own funds and assets only, and as the same shall become due.
(hg) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, constituent party to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party constituent party without the prior written consent of Lender.
(ih) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; providedreturns. Borrower shall maintain its books, howeverrecords, that Borrower’s assets resolutions and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated agreements as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate of Borrower, any constituent party of Borrower, or other Related Partyany Affiliate of any constituent party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize a separate telephone number, if any, and separate stationery, invoices and checks.
(kj) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or of the sale of material Borrower.
(l) Borrower will not commingle the funds and other assets of BorrowerBorrower with those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other person.
(m) Borrower has and will maintain its assets in such a manner that it will not commingle be costly or difficult to segregate, ascertain or identify its individual assets with from those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameperson.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being to be responsible for the debts or obligations of any other Personperson.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower Trustor represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Trustor does not own and will not own any asset or property other than (i) the PropertiesTrust Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesTrust Property.
(cb) Borrower Trustor will not engage in any business other than the ownership, management and operation of the PropertiesTrust Property and Trustor will conduct and operate its business as presently conducted and operated.
(dc) Borrower Trustor will not enter into any contract or agreement with any Affiliate affiliate of Borrowerthe Trustor, any constituent party of BorrowerTrustor, any guarantors guarantor (a “Guarantor”) of the obligations of Borrower Debt or any Affiliate part thereof or any affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower Trustor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and Debt, (ii) unsecured trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such and (iii) debt is not evidenced by a note, does not exceed $4,000,000.00 incurred in the aggregate, financing of equipment and is not in excess of sixty (60) days past dueother personal property used on the Premises. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesTrust Property.
(fe) Borrower Trustor has not made and will not make any loans or advances to any Person third party (including any affiliate or constituent party, any Guarantor or any affiliate of any constituent party or Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party.
(gf) Borrower Trustor is and will remain solvent and Borrower Trustor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower Trustor has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, good standing and Borrower right to do business in the state where it is organized or registered and in the state where the Premises are located, and Trustor will not, nor and will Borrower not permit any Related Party toits Governing Entity, or Guarantor (if Guarantor is other than a natural person), to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, articles or organization and operating agreement, trust or other organizational documents of Borrower Trustor or such Related Party the Governing Entity without the prior written consent of LenderBeneficiary.
(ih) Borrower Trustor will maintain all of its books, records, financial statements and bank accounts separate from those of its affiliates and any other Person and Borrower’s assets will not be listed constituent party and, unless treated as assets on the financial statement a division for tax purposes of any other Person except as otherwise required in accordance with GAAP. Borrower another taxpayer, Trustor will file its own tax returns to the extent required by applicable law; returns, provided, however, that BorrowerTrustor’s assets and income may be included in a consolidated tax return of financial statement with its parent companies if inclusion affiliates provided that the appropriate notations shall be made on such a consolidated tax return is required financial statement to comply with indicate the requirements separateness of applicable law or by reason Trustor and such affiliates and to indicate that none of Borrower’s being treated such affiliates assets and credit are available to satisfy the debts and other obligations of Trusor.
(i) Trustor shall maintain its books, records, resolutions and agreements as a disregarded entity for Federal income tax purposesofficial records.
(j) Borrower Trustor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate affiliate of Trustor, any constituent party of Trustor, any Guarantor or other Related Partyany affiliate of any constituent party of Trustor or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates affiliates as a division or part of the other and shall maintain and utilize a separate telephone number and separate stationery, invoices and checks.
(k) Borrower Trustor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower Trustor, Guarantor nor any Related Party Governing Entity of Trustor or Guarantor, will seek the dissolution, winding up, liquidation, consolidation or merger merger, in whole or in part, of the Trustor, Guarantor or the sale of material assets of Borrowersuch Governing Entity.
(m) Borrower Trustor will not commingle its the funds and other assets of Trustor with those of any affiliate or constituent party, any Guarantor, or any affiliate of any constituent party of Trustor or Guarantor, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameperson.
(n) Borrower Trustor has and will maintain its assets in such a manner that it will not guarantee be costly or become obligated for the debts difficult to segregate, ascertain or identify its individual assets from those of any affiliate or constituent party, any Guarantor, or any affiliate of any constituent party of Trustor or Guarantor, or any other Person and person.
(o) Trustor does not and will not hold itself out as being to be responsible for the debts or obligations of any other Personperson.
(op) Unless Borrower If Trustor is a single member limited partnership or a limited liability company formed under the laws of the State of Delawarecompany, Borrower its Governing Entity, shall require that a Person holding be an entity whose sole asset is its interest in Borrower be a corporation or limited liability company (the “SPC Party”) which Trustor and each such Governing Entity will at all times comply, and will cause Borrower Trustor to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 Paragraph 9 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedGoverning Entity.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Mortgagor does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, the Mortgaged Property (as defined in the Arkansas Note), and the Mortgaged Property (as defined in the California Note) (collectively, the "Security Property"), and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesSecurity Property.
(cb) Borrower Mortgagor will not engage in any business other than the ownership, management and operation of the PropertiesSecurity Property and Mortgagor will conduct and operate its business as presently conducted and operated.
(dc) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower Guarantor or any Affiliate of any constituent partyparty which is directly or indirectly controlling, owner controlled by or guarantor under common control with Mortgagor or Guarantor (collectively, the “Related Parties”an "Affiliate"), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower other than any Guarantor or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other PersonAffiliate.
(ed) Borrower ▇▇▇▇▇▇▇▇▇ has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan Debt, the Debt (as defined in the Arkansas Note), and the Debt (as defined in the California Note) (collectively, the "Indebtedness"), and (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, and is not in excess of sixty (60) days past due. No Indebtedness indebtedness other than the Debt Indebtedness may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property.
(fe) Borrower Mortgagor has not made and will not make any loans or advances to any Person and shall not acquire obligations or securities of third party, nor to Guarantor, any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties Affiliate or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party of Mortgagor.
(gf) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower Mortgagor has done or caused to be done and will do all things necessary necessary, to observe organizational formalities and preserve its existence, and Borrower Mortgagor will not, nor will Borrower Mortgagor permit any Related Party to, Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower Mortgagor or such Related Party without Guarantor in a manner which would adversely affect the prior written consent of LenderMortgagor's existence as a single-purpose entity.
(ih) Borrower Mortgagor will maintain all of its books, records, financial statements books and records and bank accounts separate from those of its Affiliates and any other Person constituent party of Mortgagor, and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower Mortgagor will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposesreturns.
(ji) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate Affiliate, any constituent party of Mortgagor or other Related Partyany Guarantor).
(j) Mortgagor will preserve and keep in full force and effect its existence, shall correct any known misunderstanding regarding its status as a separate entity, shall conduct good standing and qualification to do business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checksstate in which the Mortgaged Property is located.
(k) Borrower Mortgagor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower Mortgagor nor any Related Party constituent party of Mortgagor will seek the dissolution, dissolution or winding up, liquidation, consolidation or merger in whole or in part, of Mortgagor, nor will Mortgagor merge with or the sale of material assets of Borrowerbe consolidated into any other entity.
(m) Borrower Mortgagor will not commingle its the funds and other assets of Mortgagor with those of any Affiliate, any Guarantor, any constituent party of Mortgagor or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameperson.
(n) Borrower Mortgagor has and will maintain its assets in such a manner that it will not guarantee be costly or become obligated for the debts difficult to segregate, ascertain or identify its individual assets from those of any constituent party of Mortgagor, Affiliate, Guarantor or any other Person and person.
(o) Mortgagor does not and will not hold itself out as being to be responsible for the debts or obligations of any other Person.
person (o) Unless Borrower is a single member limited liability company formed under provided, that the laws foregoing shall not prevent Mortgagor from being and holding itself responsible for expenses incurred or obligations undertaken by the property manager of the State Security Property in respect of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (its duties regarding the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedSecurity Property).
(p) Borrower Mortgagor shall at obtain and maintain in full force and effect, and abide by and satisfy the material terms and conditions of, all times cause there material permits, licenses, registrations and other authorizations with or granted by any governmental authorities that may be required from time to be at least one time with respect to the performance of its obligations under this Mortgage.
(1q) duly appointed members Since the formation of Mortgagor, Mortgagor has not owned any asset, conducted any business or operation, or engaged in any business other than the ownership and operation of the board Security Property. The Mortgagor has no debts or obligations other than normal trade accounts payable in the ordinary course of directors business, and the Indebtedness. Any other indebtedness or obligation of Mortgagor has been paid in full prior to or through application of proceeds from funding of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other PersonLoan.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owninghas not owned, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own own, and will not own any asset or property other than (i) the PropertiesProject, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesProject.
(cb) Borrower will not engage in any business other than the ownership, management and operation of the PropertiesProject and Borrower will conduct and operate its business as presently conducted and operated.
(dc) Borrower will not enter into any contract or agreement with any Affiliate of the Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any constituent party, owner or guarantor (collectively, the “Related Parties”), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower has not incurred and will not incur any Indebtedness Debt other than (i) the Loan and Loan, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a notenote and is paid when due, does not exceed $4,000,000.00 and (iii) Debt incurred in the aggregate, financing of equipment and is not in excess of sixty (60) days past dueother personal property used on the Project. No Indebtedness indebtedness other than the Debt Loan may be secured (senior, subordinate or pari passu) by the PropertiesProject.
(fe) Borrower has not made and will not make any loans or advances to any Person third party (including any affiliate or constituent party or any affiliate of any constituent party), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party.
(gf) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own funds and assets only, and as the same shall become due.
(hg) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, constituent party to materially amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party constituent party without the prior written consent of Lender.
(ih) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns, provided Borrower may file its tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in on a consolidated tax return of basis. Borrower shall maintain its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated books, records, resolutions and agreements as a disregarded entity for Federal income tax purposesofficial records.
(ji) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate of Borrower, any constituent party of Borrower, or other Related Partyany Affiliate of any constituent party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize a separate telephone number, if any, and separate stationery, invoices and checks.
(kj) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower nor any Related Party constituent party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or of the sale of material Borrower.
(l) Borrower will not commingle the funds and other assets of BorrowerBorrower with those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other person.
(m) Borrower has and will maintain its assets in such a manner that it will not commingle be costly or difficult to segregate, ascertain or identify its individual assets with from those of any Affiliate or constituent party, or any Affiliate of any constituent party, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameperson.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being to be responsible for the debts or obligations of any other Personperson.
(o) Unless If Borrower is a single limited partnership or a limited liability company, each general partner or managing member (each, an "SPC Party") shall be a limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an whose sole asset is its interest in Borrower be a corporation or limited liability company (the “and each such SPC Party”) which Party will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 6.14 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedParty.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which each Borrower is organized is and shall be limited solely to (iA) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Propertiessuch Borrower’s Individual Property, (iiB) entering into this Agreement the Loan with the Lender, (iiiC) refinancing the Properties Mortgaged Property in connection with a permitted repayment of the Loan Loan, and (ivD) transacting any and all lawful business for which a Borrower limited liability company may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Each Borrower has not owned, does not own and will not own any asset or property other than (i) the Propertiesits Individual Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the Propertiessuch Individual Property.
(c) Each Borrower has not engaged, and will not engage engage, in any business other than the ownership, management and operation of the Propertiesits Individual Property.
(d) Each Borrower has not entered, and will not enter enter, into any contract or agreement with any Affiliate affiliate of such Borrower, any constituent party of such Borrower, any guarantors owner of the obligations of Borrower Borrower, the Guarantors (as hereinafter defined) or any Affiliate of affiliate or any constituent party, owner or guarantor (collectively, the “Related Parties”)party of Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with such Borrower or any constituent party of such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personowner of such Borrower.
(e) Each Borrower has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, other than (i) the Loan and (iidebt permitted under Section 3.4(i) trade payables in the ordinary course of business with trade creditors in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, and is not in excess of sixty (60) days past dueabove. No Indebtedness other Other than the Debt Loan, no indebtedness may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property, or any portion thereof, or by interests in the Borrower or any constituent entity thereof, or by any other Property of Borrowers.
(f) Each Borrower has not made and will not make any loans or advances to any Person entity or person (including any affiliate or any constituent party of such Borrower or any owner of such Borrower, or any Guarantor or any affiliate or any constituent party of Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party .
(g) Each Borrower is and will remain solvent and each Borrower has paid and will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same have or shall become due.
(h) Each Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and each Borrower has not and will not, nor will each Borrower permit any Related Party to, constituent party of such Borrower or any owner of such Borrower or any Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of such Borrower or such Related Party constituent party or Guarantor without the prior written consent of Lender.
(i) Each Borrower has maintained and will maintain all of its books, records, financial statements and bank accounts separate from those of its affiliates and any other Person and constituent party. Each Borrower’s assets have not been, and will not be be, listed as assets on the financial statement of any other entity. Each Borrower has maintained and will maintain separate financial statements showing its assets and liabilities separate and apart from those of any other Person except as otherwise required in accordance with GAAP. Borrower will file and not have its own tax returns to the extent required by applicable lawassets listed on any financial statement of any other Person; provided, however, provided however that such Borrower’s assets and income may be included in a consolidated tax return financial statement of its parent companies affiliate if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason generally accepted accounting principles (“GAAP”), provided that (i) appropriate notation shall be made on such consolidated financial statements to indicate the separateness of such Borrower from such affiliate and to indicate that such Borrower’s being treated as assets and credit are not available to satisfy the debts and other obligations of such affiliate or any other Person and (ii) such assets shall also be listed on such Borrower’s own separate balance sheet. Each Borrower has filed and will file its own tax returns and has not and will not file a disregarded entity for Federal consolidated federal income tax purposesreturn with any other entity except to the extent required to file consolidated tax returns by law. Each Borrower has maintained and shall maintain its books, records, resolutions and agreements as official records.
(j) Each Borrower has been, and will be, and at all times has held and will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate affiliate of Borrower, any constituent party of Borrower, any Guarantor or other Related Partyany affiliate or any constituent party of Guarantor), has corrected and shall correct any known misunderstanding regarding its status as a separate entity, has conducted and shall conduct business in its own name, has not identified, and shall not identify identify, itself or any of its Affiliates affiliates as a division or part of the other and has maintained and shall maintain and utilize separate telephone numbers, stationery, invoices and checks.
(k) Each Borrower has maintained and will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither each Borrower nor any Related Party constituent party thereof has sought or will seek the dissolution, winding up, liquidation, consolidation or merger merger, in whole or in part, or the sale of material assets of such Borrower.
(m) Each Borrower has not commingled and will not commingle the funds and other assets of such Borrower with those of any affiliate or any constituent party of such Borrower or any owner of such Borrower, any Guarantor, or any affiliate or any constituent party of Guarantor, or any other person, and will not participate in a cash management system with any such party.
(n) Borrower has not commingled and will not commingle its assets with those of any other Person person or entity and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(no) Each Borrower has not guaranteed and will not guarantee or become obligated for the debts of any other Person entity or person and has not, does not and will not hold itself out as being responsible for the debts or obligations of any other Personperson, except as a co-obligor with respect to the Loan.
(op) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which has and will at all times comply, comply with all of the terms and will cause Borrower to comply, provisions contained in its organizational documents and with each of the representations, warranties, warranties and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedParagraph 3.8.
(pq) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers natural person to act as independent director (an “Independent Director”) of Borrower pursuant to the terms of the Limited Liability Company Agreement of Borrower approved by Lender, in each case reasonably satisfactory to Lender who shall is not have been at the time of each such individual’s respective initial appointment, and shall has not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i5) a shareholder of, or an officeryears: (a) stockholder, director, partner officer, employee, partner, attorney or employee of, counsel of the Borrower or any affiliate of its or their shareholders, subsidiaries or Affiliates, Borrower; (iib) a customer ofcustomer, supplier or supplier to, or other person who derives any more than ten percent (10%) of its purchases or revenues from its activities with the Borrower or SPC Party any affiliate of Borrower; (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iiic) a Person person or other entity controlling or under common control with any such shareholderstockholder, partner partner, customer, supplier or customer, other person; or (ivd) a member of the immediate family of any such shareholderstockholder, director, officer, directoremployee, partner, employeecustomer, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrowerperson. As used in this clause (p)herein, the term “special purpose control” means the possession, directly or indirectly, of the power to direct or cause the direction of management, policies or activities of a person or entity” , whether through ownership of voting securities, by contract or otherwise.
(r) Borrower shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those not, without the prior unanimous written consent of the member of Borrower and provideall Independent Directors of Borrower, inter alia, take any Material Action (as defined below); provided that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) such member may not file voluntarily vote on or authorize the taking of any Material Action unless there is at least one Independent Director then serving in such capacity.
(s) Each Borrower has allocated and shall allocate fairly and reasonably any overhead expenses that are shared with an affiliate, including paying for office space and services performed by any employee of an affiliate.
(t) The stationery, invoices and checks utilized by each Borrower or utilized to collect its funds or pay its expenses has born and shall bear its own name and has not born, and shall not bear the name of any other entity, unless such entity is clearly designated as being Borrower’s agent.
(u) Each Borrower has not pledged and shall not pledge its assets for the benefit of any other person or entity, and other than with respect to the Loan, except as a bankruptcy petition without co-obligor with respect to the consent of independent managers Loan.
(v) Each Borrower has maintained and will maintain its assets in such a manner that it is not costly or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”difficult to segregate, including, but not limited to, the maintenance of ascertain or identify its books, records, bank accounts and individual assets separate from those of any affiliate or any other Person.
Appears in 1 contract
Sources: Loan Agreement (GTJ REIT, Inc.)
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is Mortgagor has not and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(cb) Borrower will ▇▇▇▇▇▇▇▇▇ has not engaged and shall not engage in any business or activity other than the ownership, management and operation of the PropertiesMortgaged Property and Mortgagor will conduct and operate in all material respects its business as presently conducted and operated.
(dc) Borrower will Mortgagor has not and shall not enter into or be a party to any transaction, contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors guarantor of the obligations of Borrower Debt or any Affiliate of part thereof (a "Guarantor") or any constituent partyparty which is directly or indirectly controlling, owner controlled by or guarantor under common control with Mortgagor or Guarantor (collectively, the “Related Parties”an "Affiliate"), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an armsarm's-length basis with third parties not so affiliated with Borrower other than any Guarantor or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other PersonAffiliate.
(ed) Borrower Mortgagor has not incurred and will shall not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan Debt and (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors in connection with owning, operating and maintaining the Mortgaged Property, in such amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, promissory note or other security instrument and is not at any time in an aggregate amount in excess of two percent (2%) of the original loan amount evidenced by the Note, and further provided that all such trade debts are paid within sixty (60) days past dueafter the same are incurred. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property.
(fe) Borrower Mortgagor has not made and will shall not make any loans or advances to any Person and shall not acquire obligations or securities of third party, nor to Guarantor, any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties Affiliate or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party of Mortgagor.
(gf) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(h) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any Related Party to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such Related Party without the prior written consent of Lender.
(i) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposes.
(j) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person (including any Affiliate or other Related Party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks.
(k) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower nor any Related Party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower.
(m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own name.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being responsible for the debts or obligations of any other Person.
(o) Unless Borrower is a single member limited liability company formed under the laws of the State of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Mortgagor does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesMortgaged Property.
(cb) Borrower Mortgagor will not engage in any business other than the ownership, management and operation of the PropertiesMortgaged Property and Mortgagor will conduct and operate its business as presently conducted and operated.
(dc) Borrower Other than any lease of a portion of the Mortgaged Property dated as of the date hereof, Mortgagor will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors guarantor of the obligations of Borrower Debt or any Affiliate of part thereof (a "Guarantor") or any constituent partyparty which is directly or indirectly controlling, owner controlled by or guarantor under common control with Mortgagor or Guarantor (collectively, the “Related Parties”an "Affiliate"), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower other than any Guarantor or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other PersonAffiliate.
(ed) Borrower Mortgagor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and Debt, (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such ; and (iii) debt is not evidenced by a note, does not exceed $4,000,000.00 incurred in the aggregate, financing of equipment and is not in excess of sixty (60) days past dueother personal property used on the Mortgaged Property. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property.
(fe) Borrower Mortgagor has not made and will not make any loans or advances to any Person and shall not acquire obligations or securities of third party, nor to Guarantor, any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties Affiliate or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party of Mortgagor.
(gf) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower Mortgagor has done or caused to be done and will do all things necessary necessary, to observe organizational formalities and preserve its existence, and Borrower Mortgagor will not, nor will Borrower Mortgagor permit any Related Party to, Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower Mortgagor or such Related Party Guarantor in a manner which would adversely affect the Mortgagor's existence as a single-purpose entity, without the prior written consent of LenderMortgagee.
(ih) Borrower Mortgagor will maintain all of its books, records, financial statements books and records and bank accounts separate from those of its Affiliates and any constituent party of Mortgagor (other than any other Person and Borrower’s assets will not be listed as assets on maker of the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposesNote).
(ji) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate Affiliate, any constituent party of Mortgagor or other Related Partyany Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks; provided, that such items may identify its relationship vis-a-vis the Guarantor.
(j) Mortgagor will preserve and keep in full force and effect its existence, good standing and qualification to do business in the state in which the Mortgaged Property is located.
(k) Borrower Mortgagor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower Mortgagor nor any Related Party constituent party of Mortgagor will seek the dissolution, dissolution or winding up, liquidation, consolidation or merger in whole or in part, of Mortgagor, nor will Mortgagor merge with or be consolidated into any other entity (other than any other maker of the sale of material assets of BorrowerNote).
(m) Borrower Mortgagor will not commingle its the funds and other assets of Mortgagor with those of any Affiliate, any Guarantor, any constituent party of Mortgagor or any other Person and will hold all person (other than any other maker of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own namethe Note).
(n) Borrower Mortgagor has and will maintain its assets in such a manner that it will not guarantee be costly or become obligated for the debts difficult to segregate, ascertain or identify its individual assets from those of any constituent party of Mortgagor, Affiliate, Guarantor or any other Person and person.
(o) Mortgagor does not and will not hold itself out as being to be responsible for the debts or obligations of any other Personperson (other than any other maker of the Note) (provided, that the foregoing shall not prevent Mortgagor from being and holding itself responsible for expenses incurred or obligations undertaken by the property manager of the Mortgaged Property in respect of its duties regarding the Mortgaged Property).
(op) Unless Borrower Mortgagor shall obtain and maintain in full force and effect, and abide by and satisfy the material terms and conditions of, all material permits, licenses, registrations and other authorizations with or granted by any governmental authorities that may be required from time to time with respect to the performance of its obligations under this Mortgage.
(q) If Mortgagor is a single member limited liability company formed under the laws of the State of Delawarepartnership, Borrower each general partner (each, an "SPC Party") shall require that a Person holding an interest in Borrower be a corporation or limited liability company (the “whose sole asset is its interest in Mortgagor and each such SPC Party”) which Party will at all times comply, and will cause Borrower Mortgagor to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 9 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedParty.
(pr) Borrower Mortgagor shall at all times cause there to be at least one (1) duly appointed members member of the board of directors (an "Independent Director") of the Mortgagor and each SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) in Mortgagor reasonably satisfactory to Lender Mortgagee who shall not have been at the time of each such individual’s respective 's appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower Mortgagor or any of its or their shareholders, subsidiaries or Affiliatesaffiliates (other than any other maker of the Note or its corporate general partner, if applicable), (ii) a customer of, or supplier to, Mortgagor or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliatesaffiliates, (iii) a Person person or other entity controlling or under common control with any such shareholder, partner partner, supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with BorrowerMortgagor. As used in this clause (p)herein, the term “special purpose "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person or entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those , whether through ownership of Borrower and providevoting securities, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers by contract or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Personotherwise.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the Properties, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the Properties.
(c) Borrower will not engage in any business other than the ownership, management management, leasing and operation of the PropertiesProperty and Borrower will conduct and operate its business as presently conducted and operated.
(db) Borrower will not enter into any contract or agreement with any Affiliate affiliate of Borrower, any constituent party of Borrower, the holder of any guarantors partnership or membership interest, any manager or the owner of the obligations of any beneficial interest in Borrower (each, a "Beneficial Owner") or any Affiliate affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Beneficial Owner, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(e) Borrower has not incurred and will not incur any Indebtedness other than (i) the Loan and (ii) trade payables in the ordinary course of business with trade creditors in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, and is not in excess of sixty (60) days past due. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the Properties.
(f) Borrower has not made and will not make any loans or advances to any Person and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents).
(g) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hc) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existenceexistence including, without limitation, the holding of such annual and other meetings as are required by the Borrower's organizational documents, and Borrower will not, nor will Borrower permit any Related Party to, constituent party or Beneficial Owner to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust certificate and agreement or other organizational documents of Borrower or such Related Party constituent party or Beneficial Owner, if such amendments would violate any provision of the Project Loan Documents, without the prior written consent of Lender, which consent shall not be unreasonably withheld, nor will Borrower permit any constituent party or Beneficial Owner to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, trust certificate and agreement or other organizational documents of such constituent party or Beneficial Owner, if such amendment, modification or change (i) would adversely affect the bankruptcy remote nature of Borrower; or (ii) would cause any of the assumptions upon which the Non-Consolidation Opinion is based to become inaccurate or untrue in any respect; or (iii) would adversely affect Lender's interest in the Project Loan. The Borrower shall deliver copies of minutes of annual meetings of the Borrower to the Lender within thirty (30) days of its receipt of written request therefore.
(id) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent where required by applicable law; providedcode or regulation. Borrower shall maintain its books, howeverrecords, that Borrower’s assets resolutions and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return agreements as official records. However, the Borrower does not and is not required to comply maintain its books in accordance with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposesGAAP.
(je) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate of Borrower, any constituent party of Borrower, any Beneficial Owner or other Related Partyany Affiliate of any constituent party), and shall conduct business in its own name and shall maintain and utilize separate stationery, invoices and checks. Borrower shall correct any known or unknown misunderstanding regarding its status as a separate entity, shall conduct business in its own name, entity and shall not identify itself as a division or part of its Affiliates or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checksBorrower.
(kf) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lg) Neither Borrower nor any Related Party constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger merger, in whole or in part, of Borrower or the sale of material assets all or substantially all of Borrower's or any constituent party's assets.
(mh) Borrower will not commingle its the funds and other assets of Borrower with those of any affiliate or constituent party, any Beneficial Owner, or any affiliate of any constituent party or Beneficial Owner, or any other Person Person.
(i) Borrower has and will hold all of maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its own name. Borrower will deposit all individual assets from those of its funds in checking accountsany affiliate or constituent party, savings accountsany Beneficial Owner, time deposits or certificate deposits in its own name any affiliate of any constituent party or invest such funds in its own nameBeneficial Owner, or any other Person.
(nj) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being to be responsible for the debts or obligations of any other Person.
(ok) Unless If Borrower is a single member (i) limited liability company, partnership or business trust, at least one manager, managing partner, general partner or trustee (the "SPC Member") of Borrower shall itself be a limited liability company formed under or corporation the laws sole asset of the State of Delaware, Borrower shall require that a Person holding an which is its interest in Borrower and which at all times has as one of its members or directors an individual who qualifies as an Independent Director, or (ii) corporation, at least one of its directors shall be an individual who qualifies as an Independent Director and who is a corporation shareholder of such corporation, and the SPC Member (in any case described in clause (i)), or limited liability company the Independent Director (the “SPC Party”) which in any case described in clause (ii)), will at all times comply, and will cause Borrower to comply, comply with each of the representations, warranties, and covenants contained in this Section 4.1.30 5.4 as if such representation, warranty or covenant was made were made, mutatis mutandis, directly by such PersonSPC Member or Independent Director. The structure of Borrower In any case described in clause (i), the SPC Member and the interest Beneficial Owner, and in any case described in clause (ii), the Independent Director and the Beneficial Owner, shall cause the Borrower at all times to comply with each of the SPC Party shall be reasonably acceptable to Lender representations, warranties, and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender covenants contained in connection with the Closing are not modified, this Section 5.4.
(l) Borrower shall not be required cause or permit the board of directors of Borrower or the SPC Member, as applicable, to have an SPC Party and all provisions take any action which, under the terms of this Agreement and any certificate of incorporation, by-laws, operating agreement or any voting trust agreement with respect to any common stock, requires the other Loan Documents pertaining to SPC Party shall be disregarded.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members unanimous vote of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its the general partners or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director members of Borrower or the SPC Party (if Member, as applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is unless at the time of initial appointmentsuch action there shall be at least one member of the board of directors of Borrower or the SPC Member, or at any time while serving as applicable, who is an Independent Director.
(m) The Borrower has not incurred and will not incur any indebtedness, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause secured or unsecured, direct or indirect, absolute or contingent (pincluding guaranteeing any obligation), other than (i) the Project Loan or (ii) unsecured trade debt customarily payable within thirty (30) days;
(n) The Borrower shall conduct its business so that the assumptions made with respect to the Borrower, in that certain opinion letter (the "Non-Consolidation Opinion") dated of even date herewith delivered by Dickinson Wright PLLC in connection with this Agreement are and shall ▇▇▇▇▇▇ ▇r▇▇ ▇▇▇ correct in all respects for the term “special purpose entity” of the Project Loan Note. The Borrower shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended deliver a certificate to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, Lender within 30 days upon written request from the Lender but not limited tomore frequently than on an annual basis except for good cause shown, certifying as to its compliance with each of the maintenance provisions of its books, records, bank accounts and assets separate from those of any other Personthis Section 5.4.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower Mortgagor represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower Mortgagor does not own and will not own any asset or property other than (i) the PropertiesMortgaged Property, the Mortgaged Property (as defined in the Arizona Note), and the Mortgaged Property (as defined in the California Note) (collectively, the "Security Property"), and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesSecurity Property.
(cb) Borrower Mortgagor will not engage in any business other than the ownership, management and operation of the PropertiesSecurity Property and Mortgagor will conduct and operate its business as presently conducted and operated.
(dc) Borrower Mortgagor will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower, any guarantors of the obligations of Borrower Guarantor or any Affiliate of any constituent partyparty which is directly or indirectly controlling, owner controlled by or guarantor under common control with Mortgagor or Guarantor (collectively, the “Related Parties”an "Affiliate"), except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower other than any Guarantor or such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other PersonAffiliate.
(ed) Borrower Mortgagor has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan Debt, the Debt (as defined in the Arizona Note), and the Debt (as defined in the California Note) (collectively the "Indebtedness"), and (ii) trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided such debt is not evidenced by a note, does not exceed $4,000,000.00 in the aggregate, and is not in excess of sixty (60) days past due. No Indebtedness indebtedness other than the Debt Indebtedness may be secured (senior, subordinate or pari passu) by the PropertiesMortgaged Property.
(fe) Borrower Mortgagor has not made and will not make any loans or advances to any Person and shall not acquire obligations or securities of third party, nor to Guarantor, any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties Affiliate or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party of Mortgagor.
(gf) Borrower Mortgagor is and will remain solvent and Borrower Mortgagor will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower Mortgagor has done or caused to be done and will do all things necessary necessary, to observe organizational formalities and preserve its existence, and Borrower Mortgagor will not, nor will Borrower Mortgagor permit any Related Party to, Guarantor to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower Mortgagor or such Related Party without Guarantor in a manner which would adversely affect the prior written consent of LenderMortgagor's existence as a single-purpose entity.
(ih) Borrower Mortgagor will maintain all of its books, records, financial statements books and records and bank accounts separate from those of its Affiliates and any other Person constituent party of Mortgagor, and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower Mortgagor will file its own tax returns to the extent required by applicable law; provided, however, that Borrower’s assets and income may be included in a consolidated tax return of its parent companies if inclusion on such a consolidated tax return is required to comply with the requirements of applicable law or by reason of Borrower’s being treated as a disregarded entity for Federal income tax purposesreturns.
(ji) Borrower Mortgagor will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate Affiliate, any constituent party of Mortgagor or other Related Partyany Guarantor).
(j) Mortgagor will preserve and keep in full force and effect its existence, shall correct any known misunderstanding regarding its status as a separate entity, shall conduct good standing and qualification to do business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other and shall maintain and utilize separate stationery, invoices and checksstate in which the Mortgaged Property is located.
(k) Borrower Mortgagor will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(l) Neither Borrower Mortgagor nor any Related Party constituent party of Mortgagor will seek the dissolution, dissolution or winding up, liquidation, consolidation or merger in whole or in part, of Mortgagor, nor will Mortgagor merge with or the sale of material assets of Borrowerbe consolidated into any other entity.
(m) Borrower Mortgagor will not commingle its the funds and other assets of Mortgagor with those of any Affiliate, any Guarantor, any constituent party of Mortgagor or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameperson.
(n) Borrower Mortgagor has and will maintain its assets in such a manner that it will not guarantee be costly or become obligated for the debts difficult to segregate, ascertain or identify its individual assets from those of any constituent party of Mortgagor, Affiliate, Guarantor or any other Person and person.
(o) Mortgagor does not and will not hold itself out as being to be responsible for the debts or obligations of any other Person.
person (o) Unless Borrower is a single member limited liability company formed under provided, that the laws foregoing shall not prevent Mortgagor from being and holding itself responsible for expenses incurred or obligations undertaken by the property manager of the State Security Property in respect of Delaware, Borrower shall require that a Person holding an interest in Borrower be a corporation or limited liability company (its duties regarding the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 4.1.30 as if such representation, warranty or covenant was made directly by such Person. The structure of Borrower and the interest of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements of the Rating Agencies for “single purpose, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under the laws of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedSecurity Property).
(p) Borrower Mortgagor shall at obtain and maintain in full force and effect, and abide by and satisfy the material terms and conditions of, all times cause there material permits, licenses, registrations and other authorizations with or granted by any governmental authorities that may be required from time to be at least one time with respect to the performance of its obligations under this Mortgage.
(1q) duly appointed members Since the formation of Mortgagor, Mortgagor has not owned any asset, conducted any business or operation, or engaged in any business other than the ownership and operation of the board Security Property. The Mortgagor has no debts or obligations other than normal trade accounts payable in the ordinary course of directors business, and the Indebtedness. Any other indebtedness or obligation of Mortgagor has been paid in full prior to or through application of proceeds from funding of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other PersonLoan.
Appears in 1 contract
Sources: Mortgage, Deed of Trust and Security Agreement (Concord Milestone Plus L P)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, transferring, exchanging, operating and managing the Properties, (ii) entering into this Agreement with Lender, (iii) refinancing the Properties in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the PropertiesProperty, and (ii) incidental personal property necessary for and used or to be used in connection with the ownership or operation of the PropertiesProperty.
(cb) Borrower will not engage in any business other than the ownership, management and operation of the PropertiesProperty and Borrower will conduct and operate its business as presently conducted and operated.
(dc) Borrower will not enter into any contract or agreement with any Affiliate affiliate of the Borrower, any constituent party of Borrower, any guarantors guarantor (a “Guarantor”) of the obligations of Borrower Debt or any Affiliate part thereof or any affiliate of any constituent party, owner party or guarantor (collectively, the “Related Parties”)Guarantor, except upon terms and conditions that are intrinsically fair, commercially reasonable fair and substantially similar to those that would be available on an arms-length basis with third parties not so affiliated with Borrower or other than any such Related Parties. Borrower will maintain an arm’s length relationship with such Related Parties or any other Personparty.
(ed) Borrower has not incurred and will not incur any Indebtedness indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Loan and Debt, (ii) unsecured trade payables and operational debt incurred in the ordinary course of business with trade creditors and in amounts as are normal and reasonable under the circumstances, provided circumstances and such debt is not evidenced by a notepromissory note executed by ▇▇▇▇▇▇▇▇, does not exceed $4,000,000.00 in provided that the aggregate, outstanding amount of such trade and is not in excess operational debt shall never be more than four percent (4%) of the stated principal sum of the Note at any one time and Borrower covenants to pay all such trade and operational debt within sixty (60) days past dueof the date the same is incurred, and (iii) debt incurred in the ordinary course of Borrower’s business to finance equipment and other personal property used on the Premises the removal of which would not materially damage the Improvements or materially impair the value of the Improvements, provided that such debt is not evidenced by a promissory note executed by ▇▇▇▇▇▇▇▇ or is secured by any property other than the item of equipment or personal property so financed. No Indebtedness indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the PropertiesProperty.
(fe) Borrower has not made and will not make any loans or advances to any Person third party (including any affiliate or constituent party, any Guarantor or any affiliate of any constituent party or Guarantor), and shall not acquire obligations or securities of any Related Party. Borrower will not form, acquire or hold any subsidiaries, or own or acquire any stock or equity interest in any Related Parties its affiliates or any other Person (except that Borrower may invest in those investments permitted under the Loan Documents)constituent party.
(gf) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own assets only, and as the same shall become due.
(hg) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, good standing and right to do business in the state where it is organized or registered and in the state where the Premises are located, and Borrower will not, nor and will Borrower not permit any Related Party toits Governing Entity or Guarantor if Guarantor is other than a natural person), to amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, articles or organization and operating agreement, trust or other organizational documents of Borrower or such Related Party Governing Entity, without the prior written consent of Lender.
(ih) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its affiliates and any other Person constituent party and Borrower’s assets will not be listed as assets on the financial statement of any other Person except as otherwise required in accordance with GAAP. Borrower will file its own tax returns to the extent required by applicable law; returns, provided, however, that Borrower▇▇▇▇▇▇▇▇’s assets and income may be included in a consolidated tax return of financial statement with its parent companies if inclusion affiliates provided that the appropriate notations shall be made on such a consolidated tax return is required financial statement to comply with indicate the requirements separateness of applicable law or by reason Borrower and such affiliates and to indicate that none of such affiliates assets and credit are available to satisfy the debts and other obligations of Borrower’s being treated as a disregarded entity for Federal income tax purposes.
(ji) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other Person entity (including any Affiliate affiliate of Borrower, any constituent party of Borrower, any Guarantor or other Related Partyany affiliate of any constituent party of Borrower or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates affiliates as a division or part of the other and shall maintain and utilize a separate telephone number and separate stationery, invoices and checks.
(kj) Borrower will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, except that no constituent party of Borrower shall be required to make any additional capital contributions to Borrower.
(lk) Neither Borrower Borrower, Guarantor nor any Related Party Governing Entity of Borrower or Guarantor, will seek the dissolution, winding up, liquidation, consolidation or merger merger, in whole or in part, of the Borrower, Guarantor or such Governing Entity.
(l) Borrower will not commingle the sale of material funds and other assets of BorrowerBorrower with those of any affiliate or constituent party, any Guarantor, or any affiliate of any constituent party of Borrower or Guarantor, or any other person.
(m) Borrower has and will maintain its assets in such a manner that it will not commingle be costly or difficult to segregate, ascertain or identify its individual assets with from those of any affiliate or constituent party, any Guarantor, or any affiliate of any constituent party of Borrower or Guarantor, or any other Person and will hold all of its assets in its own name. Borrower will deposit all of its funds in checking accounts, savings accounts, time deposits or certificate deposits in its own name or invest such funds in its own nameperson.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out as being to be responsible for the debts or obligations of any other Personperson.
(o) Unless If Borrower is a single single-member limited liability company company, (i) Borrower’s operating agreement (the “LLC Agreement”) provides for the continued existence of Borrower in the event of the bankruptcy or dissolution of the sole member, and (ii) Borrower has furnished to Lender as of the date of this Security Deed an opinion of counsel reasonably acceptable to Lender and its counsel that (i) Borrower is a legal entity formed in the state of its organization; (ii) the LLC Agreement constitutes a legal, valid and binding agreement of the sole member and is enforceable against the sole member in accordance with its terms; (iii) under the law of the state in which Borrower has been organized Borrower is a separate legal entity and the existence of Borrower as a separate legal entity shall continue until the cancellation of Borrower’s articles of organization; (iv) the LLC Agreement provides for the continued existence of Borrower in the event of the bankruptcy or dissolution of the sole member, and such provisions would be enforceable under the laws of the State of Delaware, state in which Borrower shall require that a Person holding an interest in Borrower be a corporation has been organized notwithstanding the bankruptcy or limited liability company (the “SPC Party”) which will at all times comply, and will cause Borrower to comply, with each dissolution of the representationssole member; (v) no creditor of the sole member shall have any right to satisfy its claim against sole member by obtaining possession of, warrantiesor otherwise realizing upon, the Property or any other assets of Borrower; (vi) if properly presented to a state court in the state in which Borrower has been organized, such state court applying such state’s law, would conclude that until such time that no amounts remain due and covenants contained payable and no obligations remain outstanding under the Loan Documents, in this Section 4.1.30 order for a person to file a voluntary bankruptcy petition on behalf of ▇▇▇▇▇▇▇▇, the unanimous vote of the individuals serving as if such representationthe managers of Borrower or as the managers or directors of Borrower’s Governing Entity or of the sole member or of the sole member’s Governing Entity, warranty or covenant was made directly by such Person. The structure as the case may be, is required; and (vii) although on application to a court of competent jurisdiction a judgment creditor of the sole member may be able to charge the sole member’s share of any profits and losses of Borrower and the interest sole member’s right to receive distributions of Borrower’s assets (the “Sole Member’s Interest”) and the court may appoint a receiver of the SPC Party shall be reasonably acceptable to Lender and shall satisfy the requirements share of the Rating Agencies for “single purposedistributions due or to become due to the sole member in respect of Borrower, bankruptcy remote entities”. Notwithstanding the foregoing so long as Borrower is a single member limited liability company formed under receiver shall have only the laws rights of an assignee of the State of Delaware and the organizational documents of Borrower as delivered to Lender in connection with the Closing are not modified, Borrower shall not be required to have an SPC Party and all provisions of this Agreement and the other Loan Documents pertaining to SPC Party shall be disregardedSole Member’s Interest.
(p) Borrower shall at all times cause there to be at least one (1) duly appointed members of the board of directors of the SPC Party or if Borrower is a single member Delaware limited liability company, its board of managers (an “Independent Director”) reasonably satisfactory to Lender who shall not have been at the time of each such individual’s respective appointment, and shall not be at any time while serving as a Independent Director and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, partner or employee of, Borrower or any of its or their shareholders, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or who derives any of its purchases or revenues from its activities with Borrower or SPC Party (if applicable) or any Affiliate of either of them any of its or their shareholders, subsidiaries or Affiliates, (iii) a Person controlling or under common control with any such shareholder, partner supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or the SPC Party (if applicable). Notwithstanding the foregoing, an individual that otherwise satisfies the foregoing shall not be disqualified from serving as an Independent Director if such individual is at the time of initial appointment, or at any time while serving as an Independent Director, an independent director of a “special purpose entity” affiliated with Borrower. As used in this clause (p), the term “special purpose entity” shall mean an entity whose organizational documents contain restrictions on its activities and impose requirements intended to preserve separateness that are substantially similar to those of Borrower and provide, inter alia, that it: (a) is organized for a limited purpose; (b) has restrictions on its ability to incur indebtedness, dissolve, liquidate, consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy petition without the consent of independent managers or independent directors and (d) shall conduct itself in accordance with certain “separateness covenants”, including, but not limited to, the maintenance of its books, records, bank accounts and assets separate from those of any other Person.
Appears in 1 contract
Sources: Deed to Secure Debt, Assignment of Rents and Security Agreement (NNN Healthcare/Office REIT, Inc.)