Single Purpose. Borrower hereby represents and warrants to, and covenants with, Lender that as of the date hereof and until such time as the Debt shall be paid in full: (a) Borrower does not own and will not own any asset or property other than (i) the Property, and (ii) incidental personal property necessary for the ownership or operation of the Property. (b) Borrower has not conducted any business other than in connection with this Agreement and will not engage in any business other than the ownership, management and operation of the Property and Borrower will conduct and operate its business as presently conducted and operated. (c) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arms-length basis with third parties other than any such party. (d) Borrower has not incurred and will not incur any Indebtedness other than (i) the Debt, (ii) unsecured trade payables and operational debt not evidenced by a note and (iii) Indebtedness incurred in the financing of equipment and other personal property used on the Property; provided that any Indebtedness incurred pursuant to subclauses (ii) and (iii) shall be (x) not in excess of Four Million and No/100 Dollars ($4,000,000.00) in the aggregate, (y) paid not more than sixty (60) days from the date incurred as to the matters in subclause (ii) above and not more than sixty (60) days from the date due as to the matters in subclause (iii) above and (z) incurred in the ordinary course of business. No Indebtedness other than the Debt may be secured (subordinate or pari passu) by the Property. (e) Borrower has not made and will not make any loans or advances to any third party (including any Affiliate or constituent party), and shall not acquire obligations or securities of its Affiliates. (f) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its assets as the same shall become due. (g) 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 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 constituent party without the prior consent of Lender in any manner that (i) violates the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's consent. (h) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any constituent party. Borrower's assets will not be listed as assets on the financial statement of any other Person, provided, however, that Borrower's assets may be included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation shall be made on such consolidated financial statements to indicate the separateness of Borrower and such Affiliates and to indicate that Borrower's assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person and (ii) such assets shall be listed on Borrower's own separate balance sheet. Borrower will file its own tax returns (to the extent Borrower is required to file any such tax returns) and will not file a consolidated federal income tax return with any other Person. Borrower shall maintain its books, records, resolutions and agreements as official records. (i) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of 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 as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks bearing its own name. (j) 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. (k) Neither Borrower nor any constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower. (l) Borrower will not commingle the funds and other assets of Borrower with those of any Affiliate or constituent party or any other Person, and will hold all of its assets in its own name. (m) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or constituent party or any other Person. (n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out to be responsible for or make its assets available to satisfy the debts or obligations of any other Person. (i) If Borrower is a limited partnership or a limited liability company (other than a single member limited liability company), each general partner or managing member (each, an "SPC Party") shall be a corporation 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 3.1.24 as if such representation, warranty or covenant was made directly by such SPC Party. Upon the withdrawal or the disassociation of an SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party whose articles of incorporation are substantially similar to those of such SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners. (ii) If Borrower is a single member limited liability company, Borrower shall have at least two springing members, one of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member. (p) Borrower shall at all times cause there to be at least two duly appointed members of the board of directors (or two special managers if Borrower is a limited liability company) who are provided by a nationally-recognized company that provides professional independent directors (each, an "Independent Director") of each SPC Party and Borrower reasonably satisfactory to Lender who shall not have been at the time of such individual's appointment or at any time while serving as a director or manager of such SPC Party and Borrower, and may not have been at any time during the preceding five years (i) a stockholder, director (other than as an Independent Director), officer, employee, partner, attorney or counsel of such SPC Party, Borrower or any Affiliate of either of them, (ii) a customer, supplier or other Person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate of either of them, (iii) a Person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, or (iv) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower 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 the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special members. As used in this definition, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwise. (q) Borrower shall not cause or permit the board of directors of any SPC Party and Borrower 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 or under any organizational document of Borrower or SPC Party, requires a vote of the board of directors or managers of each SPC Party and Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director. (r) 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. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC Party. (s) Borrower will not permit any Affiliate or constituent party access to its bank accounts except as required for the conduct of Borrower's business. (t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations. (u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.
Appears in 1 contract
Single Purpose. Notwithstanding anything to the contrary contained herein or otherwise, Borrower hereby represents and warrants to, and covenants with, Lender that as of the date hereof and until such time as the Debt shall be paid in full:
(ai) Borrower has not owned, does not currently own and will not own any asset or property other than (iA) the Property, Property and (iiB) incidental personal property necessary for the ownership or operation of the Property.
(bii) Borrower has not conducted any business other than engaged in connection with this Agreement and will not engage in any business other than the ownership, management development, management, leasing and operation of the Property and Borrower will conduct and operate its business as presently conducted and operatedProperty.
(c) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arms-length basis with third parties other than any such party.
(diii) 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 Debt, (ii) Debt and unsecured trade payables and operational debt not evidenced by a note and (iii) Indebtedness incurred in the financing of equipment and other personal property used on the Property; provided that any Indebtedness incurred pursuant to subclauses (ii) and (iii) shall be (x) not in excess of Four Million and No/100 Dollars ($4,000,000.00) in the aggregate, (y) paid not more than sixty (60) days from the date incurred as to the matters in subclause (ii) above and not more than sixty (60) days from the date due as to the matters in subclause (iii) above and (z) incurred in the ordinary course of businessbusiness relating to the ownership of the Property, none of which is or shall be at any time more than thirty (30) days past due (unless same is being contested in accordance with applicable Legal Requirements and the Loan Documents and Lender has been notified in writing of the same) and does not and shall not exceed in the aggregate at any time the Maximum Permitted Trade Payables. Except as permitted by Section 5.22(g), no constituent member, partner or shareholder of Borrower (direct or indirect, and no matter how remote) has incurred or will incur any Indebtedness secured (directly or indirectly) by such Person’s legal or beneficial ownership interest in Borrower or any constituent member, partner or shareholder of Borrower (direct or indirect, legal or beneficial, and no matter how remote). No Indebtedness other than the Debt may be secured (superior, subordinate or pari passu) by the Property or any portion thereof. Notwithstanding the foregoing, Borrower shall be permitted to incur, subject to the prior written consent of Lender not to be unreasonably withheld, subordinate construction loan financing for the Property.
(eiv) Borrower has not made and will not make any loans or advances to any third party Person (including any Affiliate or constituent party), and has not acquired and shall not acquire obligations or securities of its Affiliatesany Borrower Party or any Affiliate of Borrower or any Borrower Party.
(fv) Borrower is and will remain solvent and Borrower has at all times during its existence paid and will continue to pay its debts debts, liabilities and liabilities expenses (including, as applicable, shared personnel and overhead expenses) only from its Borrower’s assets as the same shall become due.
(gvi) Borrower has done or caused to be done and will do all things necessary to observe limited liability company and other organizational formalities and preserve Borrower’s existence and has at all times complied with and will continue to comply with the provisions of its existence, Organizational Documents and Borrower will not, nor will Borrower permit the laws of the state of its organization and any constituent party to amend, modify or otherwise change other state where laws govern the partnership certificate, partnership agreement, articles activities of incorporation and bylaws, operating agreement, trust or other organizational documents of Borrower or such constituent party without the prior consent of Lender in any manner that (i) violates the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's consentBorrower.
(hvii) Borrower has at all times during its existence maintained and will continue to maintain all of its Borrower’s books, records, financial statements and bank accounts separate from those of its Affiliates and any constituent party. Borrower's assets will not be listed as assets on the financial statement of any other Person, provided, however, that Borrower's assets may be included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation shall be made on such consolidated financial statements to indicate the separateness of Borrower and such Affiliates and to indicate that Borrower's assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person and (ii) such assets shall be listed on Borrower's own separate balance sheet. Borrower will file its own tax returns (to the extent returns. Borrower is required to file any such tax returns) has at all times during its existence maintained and will not file a consolidated federal income tax return with any other Person. Borrower shall continue to maintain its Borrower’s books, records, resolutions and agreements as official records.
(iviii) Borrower is and will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity Person (including any Affiliate of Borrower or any constituent party of Borrower), has at all times conducted and will continue to conduct business in its own name, has at all times corrected and shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, has not identified and shall not identify itself or any of its Affiliates as a division or part of the any other Person and has maintained and shall continue to maintain and utilize separate stationery, invoices and checks bearing its own name.
(jix) Borrower has maintained and will continue to 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.
(kx) Neither Borrower nor any constituent party of Borrower will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower.
(lxi) Borrower has not commingled and will not commingle the its funds and other assets of Borrower with those of any Affiliate or constituent party or any other Person, and Borrower has not controlled and will hold all not control the decisions with respect to the daily affairs of its assets in its own nameany other Person.
(mxii) Borrower has maintained and will continue to maintain its assets in such a manner that it will would not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or constituent party of Borrower or any other Person.
(nxiii) Borrower will has not guarantee or become obligated for the debts of any other Person and held, does not currently hold and will not hold itself out to be responsible for or make its assets available to satisfy the debts or obligations of any other Person.
(ixiv) Borrower has at all times during its existence held, and will continue to hold, all of its assets in its own name.
(xv) Borrower has not at any time during its existence guaranteed or become obligated for, and will not in the future guarantee or become obligated for, the debts of any other Person.
(xvi) Except as specifically provided in the Loan Documents, no other Person has ever guaranteed or become obligated for Borrower’s debts at any time during Borrower’s existence, and except as specifically provided in the Loan Documents, Borrower will not permit any other Person to guarantee or become obligated for its debts at any time in the future.
(xvii) Borrower has not at any time during its existence held, and will not in the future hold, out Borrower’s credit as being available to satisfy the obligations of any other Person.
(xviii) No other Person has ever held, and Borrower will not permit any other Person to hold, out Borrower’s credit as being available to satisfy the obligations of any other Person.
(xix) Borrower has not at any time during its existence bought or held, or will in the future buy or hold, evidence of Indebtedness issued by any of its Affiliates or equity interest holders (direct or indirect, legal or beneficial).
(xx) Borrower has at all times during its existence allocated fairly and reasonably (and paid or charged for, as applicable), and will continue to allocate fairly and reasonably (and pay or charge for, as applicable), any overhead expenses that are shared with an Affiliate of Borrower, including paying for office space provided by and services performed by any employee of an Affiliate of Borrower.
(xxi) Except as provided in the Loan Documents, Borrower has not at any time during its existence pledged, or will in the future pledge, its assets for the benefit of any other Person.
(xxii) No other Person has ever pledged, and Borrower will not permit any other Person to pledge, Borrower’s assets for such other Person’s benefit.
(xxiii) No other Person has ever identified, and Borrower will not permit any other Person to identify, Borrower as a division of any other Person.
(xxiv) If Borrower is a limited partnership or liability company, at least one member of Borrower shall be a Single Purpose Entity (the “SPE Member”), and only the SPE Member may be designated as managing member. If Borrower is a limited liability company company, Borrower shall at all times either be member managed or be managed by a Board of Directors or Board of Managers and shall have at least one (other than a single 1) springing member limited liability company), each general partner or managing that will become the member (each, an "SPC Party") shall be a corporation whose sole asset is its interest in of Borrower and each such SPC Party upon the dissolution of the last remaining member of Borrower. The SPE Member of Borrower will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, warranties and covenants contained in this Section 3.1.24 4.1.(s) as if such representation, warranty or covenant was made directly by such SPC Partythe SPE Member. Upon the withdrawal withdrawal, removal or the disassociation of an SPC Party the SPE Member from Borrower, Borrower shall immediately cause the SPE Member to appoint a new SPC Party member whose articles of incorporation or articles of organization are substantially similar to those of such SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity ownersSPE Member.
(iixxv) If Borrower is a single member limited liability company, Borrower shall have at least two springing members, one of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole memberIntentionally Omitted.
(pxxvi) Borrower shall at all times cause there to be at least two duly appointed members of the board of directors (or two special managers if Borrower is a limited liability company) who are provided by a nationally-recognized company that provides professional independent directors (each, an "Independent Director") of each SPC Party and Borrower reasonably satisfactory to Lender who shall not have been at the time of such individual's appointment or at any time while serving as a director or manager of such SPC Party and Borrower, and may not have been at any time during the preceding five years (i) a stockholder, director (other than as an Independent Director), officer, employee, partner, attorney or counsel of such SPC Party, Borrower or any Affiliate of either of them, (ii) a customer, supplier or other Person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate of either of them, (iii) a Person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, or (iv) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower 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 the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special members. As used in this definition, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwiseIntentionally Omitted.
(q) Borrower shall not cause or permit the board of directors of any SPC Party and Borrower 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 or under any organizational document of Borrower or SPC Party, requires a vote of the board of directors or managers of each SPC Party and Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) 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. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC Party.
(s) Borrower will not permit any Affiliate or constituent party access to its bank accounts except as required for the conduct of Borrower's business.
(t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.
Appears in 1 contract
Single Purpose. Borrower hereby represents and warrants to, and covenants with, Lender that as of the date hereof and until such time as the Debt shall be paid in full:
(a) Borrower does not own and will not own any asset or property other than (i) the Property, and (ii) incidental personal property necessary for the ownership or operation of the PropertyProperty and (iii) Permitted Investments, cash and cash equivalents.
(b) Borrower has not conducted any business other than in connection with this Agreement and will not engage in any business other than the ownership, management and operation of the Property and Borrower will conduct and operate its business as presently conducted and operated.
(c) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any such constituent party, 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 other than any such party, and Borrower represents and warrants that the terms and conditions of the Lease and Master Supervisory Agreement entered into between Borrower and one or more of its Affiliates relating to the health club facilities at the Property (collectively, the “Health Club Documents”) meet the requirements of this clause (c) in light of the economics of the health club facilities at the Property and the REIT rules affecting (directly or indirectly) Borrower.
(d) Borrower has not incurred and will not incur any Indebtedness other than (i) the Debt, (ii) unsecured trade payables and operational debt not evidenced by a note and (iii) Indebtedness incurred in the financing of equipment and other personal property used on the Property; provided that any Indebtedness incurred pursuant to subclauses (ii) and (iii) shall be (x) not in excess of Four Million and No/100 Dollars ($4,000,000.00) in the aggregate, (y) paid not more than sixty (60) days from the date incurred as to the matters in subclause past due, (ii) above and not more than sixty (60) days from the date due as to the matters in subclause (iii) above and (zy) incurred in the ordinary course of businessbusiness and (z) not more than three percent (3%) of the outstanding principal amount of the Loan at any one time. No Indebtedness other than the Debt may be secured (subordinate or pari passu) by the Property, except that any permitted equipment financing or equipment lease may be secured by such equipment.
(e) Borrower has not made and will not make any loans or advances to any third party other Person (including any Affiliate or constituent party), and shall not acquire obligations or securities of its AffiliatesAffiliates or owners.
(f) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its assets as the same shall become due.
(g) Borrower has done or caused to be done and will do all things necessary to observe all applicable organizational formalities and preserve its existence, and Borrower will not, nor will Borrower permit any 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 constituent party without the prior consent of Lender in any manner that (i) violates or is inconsistent with any of the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's ’s consent.
(h) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any constituent partyother Person. Borrower's ’s assets will not be listed as assets on the financial statement of any other Person, provided, however, that Borrower's ’s assets may be included in a consolidated financial statement of its Affiliates any Affiliate provided that (i) appropriate notation shall be made inclusion on such consolidated financial statements statement is in accordance with the requirements of GAAP (or such other accounting method reasonably acceptable to indicate the separateness of Borrower and such Affiliates and to indicate that Borrower's assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person and Lender), (ii) such consolidated financial statement shall contain a footnote to the effect that Borrower’s assets shall be are owned by Borrower and (iii) such assets are listed on Borrower's ’s own separate balance sheet. Borrower will file its own tax returns (to the extent unless Borrower is a tax-disregarded entity not required to file any such tax returns) returns under applicable law and if Borrower is a corporation will not file a consolidated federal income tax return with any other Person. Borrower shall maintain its books, records, resolutions and agreements as official records.
(i) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of 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 as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks bearing its own name.
(j) 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.
(k) Neither Borrower nor any constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower.
(l) Borrower will not commingle the funds and other assets of Borrower with those of any Affiliate or constituent party or any other Person, and will hold all of its assets in its own name.
(m) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or constituent party or any other Person.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out to be responsible for or make have its assets credit available to satisfy the debts or obligations of any other Person.
(i) If Borrower is a limited partnership or a limited liability company (other than a single member limited liability company), each general partner or managing member (each, an "“SPC Party"”) shall be a corporation 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 3.1.24 as if such representation, warranty or covenant was made directly by such SPC Party. Upon the withdrawal or the disassociation of an SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party whose articles of incorporation are substantially similar to those of such SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners.
(ii) If Borrower is a single member Delaware limited liability company, Borrower shall at all times have at least either a Delaware corporation or two (2) Independent Directors as Borrower’s springing members, one of member(s) which, upon the dissolution of such the sole member of Borrower or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole member member(s) of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member.
(p) Borrower shall at all times cause there to be at least two duly appointed members of the board of directors of each SPC Party (or two special managers if any) or, if Borrower is a single member Delaware limited liability company) , at least two duly appointed managers of Borrower who in each case are provided by a nationally-nationally recognized company that provides professional independent directors (each, an "“Independent Director"”) of each SPC Party and Borrower reasonably satisfactory to Lender who shall not have been at the time of such individual's ’s appointment or at any time while serving as a director of such SPC Party or manager of such SPC Party and Borrower, and may not have been at any time during the preceding five years years
(i) a stockholder, director (other than as an Independent DirectorDirector of such SPC party), officer, manager (other than as Independent Director of Borrower, if Borrower is a single member limited liability company), employee, partner, member, attorney or counsel of such SPC Party, Borrower or any Affiliate of either any of them, (ii) a creditor, customer, supplier or other Person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate of either of them (other than a Person provided to serve as Independent Director by a company that provides professional independent directors or other general corporate services to Borrower, such SPC Party or any Affiliate of either of them), (iii) a Person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, or (iv) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower 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 the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special members. As used in this definition, the term "“control" ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwise. A natural person who satisfies the foregoing definition except for being the independent director or manager of an Affiliate of Borrower and/or of a SPC Party shall not be disqualified from serving as an Independent Director of Borrower or SPC Party, as applicable, if such Affiliate is a special purpose entity that does not own a direct or indirect equity interest in Borrower or any co-borrower with Borrower, if any, and if such individual is an independent director provided by a nationally-recognized company that provides professional independent directors. For purposes of this paragraph, a “special purpose entity” is an entity, whose organizational documents contain restrictions on its activities substantially similar to those set forth in this Section 3.1.24.
(q) Borrower shall not cause or permit the board of directors of any SPC Party and or Borrower 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 or under any organizational document of Borrower or SPC Party, requires a unanimous vote of the board of directors or managers of each SPC Party and and/or Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) 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 material respects. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC Party.
(s) Borrower will not permit any Affiliate or constituent party independent access to its bank accounts except as required for accounts, other than Manager (including its authorized employees) in accordance with the conduct of Borrower's businessManagement Agreement.
(t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.
(v) Borrower shall allocate fairly and reasonably any overhead expenses that are shared with any Affiliate, including for shared office space and for services performed by any employee of an Affiliate.
(w) Borrower shall not pledge its assets for the benefit of any other Person (other than (x) to Lender with respect to the Loan and (y) equipment secured by permitted equipment financings or equipment leases) and Borrower shall not engage in any sale or transfer of its assets outside the ordinary course of its business or in violation of this Agreement and the other Loan Documents.
(x) Borrower shall not buy or hold evidence of indebtedness issued by any other Person (other than cash and investment-grade securities).
(y) Borrower shall not form, acquire or hold any subsidiary or own any equity interest in any other entity.
(z) Neither Borrower nor SPC Party shall, without the affirmative vote of the managing member and the board of directors of Borrower or of such SPC Party, as applicable, including both Independent Directors of Borrower or of SPC Party, as applicable:
(i) File or consent to the filing of any bankruptcy, insolvency or reorganization case or proceeding; institute any proceedings under any applicable insolvency law or otherwise seek relief under any laws relating to the relief from debts or the protection of debtors generally, on behalf of Borrower or of SPC Party;
(ii) Seek or consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator, custodian or any similar official for SPC Party or Borrower or a substantial portion of either of their properties;
(iii) Make any assignment for the benefit of the creditors of SPC Party or Borrower; or
(iv) Take any action in furtherance of any of the foregoing.
Appears in 1 contract
Single Purpose. Each Borrower hereby represents and warrants to, and covenants with, Lender that as of the date hereof and until such time as the Debt Obligations shall be paid and performed in full:
(a) Such Borrower does not own and will not own any asset or property other than (i) the applicable Individual Property, and (ii) incidental personal property necessary for the ownership or operation of the such Individual Property.
(b) Such Borrower has not conducted any business other than in connection with this Agreement engaged and will not engage in any business other than the ownership, management and operation of the applicable Individual Property and Borrower will conduct and operate its business as presently conducted and operated.
(c) Such Borrower has not and will not enter into any contract or agreement with any Affiliate of any Borrower, any constituent party of any Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arms-length basis with third parties other than any such party.
(d) Such Borrower has not incurred and will not incur any Indebtedness other than (i) the Debt, and (ii) unsecured trade payables and operational debt not evidenced by a note and in an aggregate amount not exceeding five percent (iii5.0%) Indebtedness incurred in of the financing original principal amount of equipment and other personal property used on the Propertyportion of the Loan relating to the applicable Individual Property at any one time; provided that any Indebtedness incurred pursuant to subclauses subclause (ii) and (iii) shall be (xA) not in excess of Four Million and No/100 Dollars ($4,000,000.00) in the aggregate, (y) paid not more than sixty (60) days from the date incurred as to the matters in subclause (ii) above and not more than sixty (60) days from the date due as to the matters in subclause (iii) above past due, and (zB) incurred in the ordinary course of businessbusiness (the Indebtedness described in the foregoing 108 clauses (i) and (ii) is referred to herein, collectively, as "PERMITTED INDEBTEDNESS"). No Indebtedness other than the Debt may be secured (subordinate or pari passuPARI PASSU) by the any Individual Property.
(e) Such Borrower has not made and will not make any loans or advances to any third party (including any Affiliate or constituent party), and has not and shall not acquire obligations or securities of its Affiliates.
(f) Such Borrower is and will remain solvent and such Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its assets as the same shall become due.
(g) Such Borrower has done or caused to be done done, and will do do, all things necessary to observe organizational formalities and preserve its existence, and such Borrower will notnot (i) terminate or fail to comply with the provisions of its organizational documents, nor will Borrower permit any constituent party to or (ii) unless (A) Lender has consented and (B) following a Securitization of the Loan, the applicable Rating Agencies have issued a Rating Agency Confirmation, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, its operating agreement, trust agreement or other organizational documents of Borrower or such constituent party without the prior consent of Lender in any manner that (i) violates the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's consentdocuments.
(h) Such Borrower has maintained and will maintain all of its books, records, financial statements and bank accounts accounts, including, without limitation, the applicable Clearing Account, separate from those of its Affiliates and any constituent partyother Person, including without limitation, any other Borrower. Such Borrower's assets will not be listed as assets on the financial statement of any other Person, provided, however, that such Borrower's assets may be included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation shall be made on such consolidated financial statements or the notes thereto to indicate the separateness of such Borrower and such Affiliates and to indicate that such Borrower's assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person Person, and (ii) such assets shall be listed on such Borrower's own separate balance sheet. Such Borrower will file its own tax returns (to the extent such Borrower is required to file any such tax returns) and will not file a consolidated federal income tax return with any other Person, unless required by any Legal Requirements, tax code or GAAP. Such Borrower has maintained and shall maintain its books, records, resolutions and agreements as official records.
(i) Such Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate of such Borrower or any constituent party 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 as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks bearing its own name.
(j) Such 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.. 109
(k) Neither such Borrower nor any constituent party will seek or effect the liquidation, dissolution, winding up, liquidationconsolidation, consolidation asset sale or merger, in whole or in part, of Borrower.
(l) Such Borrower has not and will not commingle the funds and other assets of Borrower with those of any Affiliate or constituent party or any other Person, and has held and will hold all of its assets in its own name.
(m) Such Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or constituent party or any other Person, except as provided herein and in any other Loan Documents.
(n) Such Borrower has not and will not assume or guarantee or become obligated for the debts of any other Person and does not and will not hold itself out to be responsible for or make have its assets credit available to satisfy the debts or obligations of any other Person.
(io) If The organizational documents of Borrower is a limited partnership or a limited liability company (other than a single member limited liability company), each general partner or managing member (each, an "SPC Party") shall provide that the business and affairs of such Borrower shall be managed by or under the direction of a corporation whose sole asset is its interest in Borrower board of one or more directors designated by Sole Equity Member, 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 3.1.24 as if such representation, warranty or covenant was made directly by such SPC Party. Upon the withdrawal or the disassociation of an SPC Party from Borrower, Borrower there shall immediately appoint a new SPC Party whose articles of incorporation are substantially similar to those of such SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners.
(ii) If Borrower is a single member limited liability company, Borrower shall have at least two springing members, one of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member.
(p) Borrower shall at all times cause there to be at least two (2) duly appointed members of individuals on the board of directors (or two special managers if Borrower is a limited liability company) who are provided by a nationally-recognized company that provides professional independent directors (each, an "Independent DirectorINDEPENDENT DIRECTOR") of each SPC Party and such Borrower who are reasonably satisfactory to Lender and who shall not have been at the time of such individual's appointment or at any time (except pursuant to an express provision in such Borrower's operating agreement providing for the appointment of such Independent Director to become a "special member" upon Sole Equity Member ceasing to be a member of such Borrower) while serving as a director or manager of such SPC Party and Borroweran Independent Director, and may not have been at any time during the preceding five (5) years (i) a stockholder, director (other than as an Independent Director), officer, employee, partner, attorney or counsel of such SPC PartyBorrower, any Affiliate of such Borrower or any Affiliate direct or indirect parent of either of themsuch Borrower, (ii) a customer, supplier or other Person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate of either of themsuch Borrower, (iii) a Person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, or (iv) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower 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 the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special members. As used in this definition, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a such Person, whether through ownership of voting securities, by contract or otherwise.
(qp) The organizational documents of such Borrower shall not cause or permit provide that the board of directors of any SPC Party and such Borrower to shall not take any action which, under the terms of any certificate of incorporationformation, by-laws limited liability company operating agreement or any voting trust agreement with respect to any common stock or under any organizational document of Borrower or SPC Partyagreement, requires a an unanimous vote of the board of directors or managers of each SPC Party and such Borrower unless at the time of such action there shall be at least two (2) members of the board members or managers of directors who are each Independent Directors (and such Independent Directors have participated in such vote). Such Borrower will not without the unanimous written consent of its board of directors including the Independent Directors (i) 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, (ii) seek or consent to the 110 appointment of a receiver, liquidator or any similar official, (iii) take any action that might cause such entity to become insolvent, or (iv) make an assignment for the benefit of creditors.
(q) The organizational documents of such Borrower shall provide that, as long as any portion of the Obligations remains outstanding, upon the occurrence of any event that causes Sole Equity Member to cease to be a member of such Borrower (other than (i) upon an assignment by Sole Equity Member of all of its limited liability company interest in such Borrower and the admission of the transferee, if permitted pursuant to the organizational documents of such Borrower and the Loan Documents, or (ii) the resignation of Sole Equity Member and the admission of an additional member of such Borrower, if permitted pursuant to the organizational documents of such Borrower and the Loan Documents), one of the persons acting as an Independent Director of such Borrower shall, without any action of any Person and simultaneously with Sole Equity Member ceasing to be a member of such Borrower, automatically be admitted as the Sole Equity Member of such Borrower (the "SPECIAL MEMBER") and shall preserve and continue the existence of such Borrower without dissolution. The organizational documents of such Borrower shall further provide that for so long as any portion of the Obligations is outstanding, no Special Member may resign or transfer its rights as Special Member unless (i) a successor Special Member has been admitted to such Borrower as a Special Member, and (ii) such successor Special Member has also accepted its appointment as an Independent Director.
(r) The organizational documents of such Borrower shall provide that, as long as any portion of the Obligations remains outstanding, except as expressly permitted pursuant to the terms of this Agreement, (i) Sole Equity Member may not resign, and (ii) no additional member shall be admitted to such Borrower.
(s) The organizational documents of such Borrower shall provide that, as long as any portion of the Obligations remains outstanding: (i) such Borrower shall be dissolved, and its affairs shall be wound up, only upon the first to occur of the following: (A) the termination of the legal existence of the last remaining member of such Borrower or the occurrence of any other event which terminates the continued membership of the last remaining member of such Borrower in such Borrower unless the business of such Borrower is continued in a manner permitted by its operating agreement or the Delaware Limited Liability Company Act (the "ACT"), or (B) the entry of a decree of judicial dissolution under Section 18-802 of the Act; (ii) upon the occurrence of any event that causes the last remaining member of such Borrower to cease to be a member of such Borrower or that causes Sole Equity Member to cease to be a member of such Borrower (other than (A) upon an assignment by Sole Equity Member of all of its limited liability company interest in such Borrower and the admission of the transferee, if permitted pursuant to the organizational documents of such Borrower and the Loan Documents, or (B) the resignation of Sole Equity Member and the admission of an additional member of such Borrower, if permitted pursuant to the organizational documents of such Borrower and the Loan Documents), to the fullest extent permitted by law, the personal representative of such last remaining member shall be authorized to, and shall, within ninety (90) days after the occurrence of the event that terminated the continued membership of such member in such Borrower, agree in writing (I) to continue the existence of such Borrower, and (II) to the admission of the personal representative or its nominee or designee, as the case may be, as a substitute member of such Borrower, effective as of the occurrence of the event that terminated the continued membership of such member in such Borrower; (iii) the bankruptcy of Sole Equity Member or a Special Member shall not cause such Sole Equity Member or Special Member, respectively, to cease to be a member of such Borrower and upon the occurrence of such an event, the business of such Borrower shall continue without dissolution; (iv) in the event of the dissolution of such Borrower, such Borrower shall conduct only such activities as are necessary to wind up its affairs (including the sale of the assets of such Borrower in an orderly manner), and the assets of such Borrower shall be applied in the manner, and in the order of priority, set forth in Section 18-804 of the Act; and (v) to the fullest extent permitted by law, each of Sole Equity Member and the Special Members shall irrevocably waive any right or power that they might have to cause such Borrower or any of its assets to be partitioned, to cause the appointment of a receiver for all or any portion of the assets of such Borrower, to compel any sale of all or any portion of the assets of such Borrower pursuant to any applicable law or to file a complaint or to institute any proceeding at law or in equity to cause the dissolution, liquidation, winding up or termination of such Borrower.
(t) Such Borrower shall conduct its business so that the assumptions made with respect to such Borrower in the Insolvency Opinion shall be true and correct in all respects. In connection with the foregoing, such Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the such Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all of the representations, warranties and covenants in this Section SECTION 3.1.24, and (iii) all of the organizational documents of the Borrower and any SPC Partysuch Borrower.
(su) Such Borrower will not permit any Affiliate or constituent party (other than Manager) independent access to its bank accounts except as required for the conduct of Borrower's businessaccounts.
(tv) Such Borrower has paid and shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(uw) Such Borrower has compensated and shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.
(x) Such Borrower has not, and without the unanimous consent of all of its directors or members (including all Independent Directors), as applicable, will not (i) file a bankruptcy, insolvency or reorganization petition or otherwise institute insolvency proceedings or otherwise seek any relief under any laws relating to the relief from debts or the protection of debtors generally, (ii) seek or consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator, custodian or any similar official for such entity or for all or any portion of such Borrower's properties, (iii) make any assignment for the benefit of such Borrower's creditors, or (iv) take any action that might cause Borrower to become insolvent.
(y) Such Borrower has maintained and will maintain an arm's-length relationship with its Affiliates.
(z) Such Borrower has allocated and will allocate fairly and reasonably shared expenses, including shared office space.
(aa) Except in connection with the Loan, such Borrower has not pledged and will not pledge its assets for the benefit of any other Person.
(bb) Such Borrower has and will have no obligation to indemnify its officers, directors, members or Special Members, as the case may be, or has such an obligation that is fully subordinated to the Debt and will not constitute a claim against it if cash flow in excess of the amount required to pay the Debt is insufficient to pay such obligation.
(cc) Borrower and the Independent Directors will consider the interests of Borrower's creditors in connection with all limited liability company actions.
Appears in 1 contract
Single Purpose. Borrower hereby represents and warrants to, and covenants with, Lender that as of the date hereof and until such time as the Debt shall be paid in full:
(a1) Propco Borrower does not own and will not own any asset or property other than (i) the Property, and (ii) incidental personal property necessary for the ownership or operation of the Property and (2) Opco Borrower does not own and will not own any asset or property other than the personalty and other assets owned by it necessary for the operation of the Property.
(b1) Propco Borrower has not conducted any business other than in connection with this Agreement and will not engage in any business other than the ownership, management and operation of the Property and (2) Opco Borrower will not engage in any business other than the management and operation of the Property, and each Borrower will conduct and operate its business as presently conducted and operated.
(c) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair commercially reasonable (taking into account all facts and substantially similar to those that would be available on an armsarm’s-length basis with third parties other than any such partyparty or a capital contribution or distribution.
(d) Borrower has not incurred and will not incur any Indebtedness other than (i) the Debt, (ii) ). unsecured trade payables and operational debt not evidenced by a note and (iii) Indebtedness incurred in the financing of equipment and other personal property used on the Property; provided that any Indebtedness incurred pursuant to subclauses (ii) and (iii) shall be (x) not in excess of Four Million and No/100 Dollars ($4,000,000.00) 5% of the outstanding principal amount of the Loan in the aggregate, (y) paid not more than sixty (60) days from the date incurred as to the matters in subclause (ii) above and not more than sixty (60) days from the date due as to the matters in subclause (iii) above and (z) incurred in the ordinary course of business. No Indebtedness other than the Debt may be secured (subordinate or pari passu) by the PropertyProperty other than Indebtedness of the type described in and subject to the requirements of clause (iii) of this clause (d).
(e) Except as expressly contemplated by the Loan Documents with respect to the other Borrower, Borrower has not made and will not make any loans or advances to any third party (including any Affiliate or constituent party), and shall not acquire obligations or securities of any of its Affiliates.
(f) Borrower is and will remain solvent and Borrower will pay all of its debts and liabilities (including, as applicable, a fairly allocated portion of shared personnel and overhead expenses) only from its own assets and as the same shall become due.
(g) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities applicable to Borrower and preserve its Borrower’s existence, and Borrower will not, nor will Borrower permit any 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 constituent party without the prior consent of Lender in any manner that (i) violates or makes such organizational documents inconsistent with the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's ’s consent.
(h) Borrower will maintain all of its books, records, financial statements (it being acknowledged that the agent under the Cash Management Agency Agreement shall be continuously able to produce separate balance sheets of the Borrowers) and (except as contemplated in the Cash Management Agency Agreement) bank accounts separate from those of its Affiliates and from those of any constituent partyother Person. Borrower's ’s assets will not be listed as assets on the financial statement of any other Person, provided, however, that Borrower's ’s assets may be included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation shall be made on such consolidated financial statements (and/or in Annual Reports on Form 10-K filed with U.S. Securities and Exchange Commission in which such financial statements are contained) to indicate the separateness of Borrower and such Affiliates and to indicate that Borrower's ’s assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person and (ii) such assets shall are continuously able to be listed on Borrower's ’s own separate balance sheet. Borrower will file its own tax returns (to the extent Borrower is required to file any such tax returns) and will not file a consolidated federal income tax return with any other Person). Borrower shall maintain its books, records, resolutions and agreements as official records.
(i) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of 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 as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks bearing its own namename (except with respect to payments or communications made on behalf of the Borrower by the counterparty to the Cash Management Agency Agreement, in which event, such counterparty shall nevertheless identify the Borrower as the party on whose behalf the payment or communication is being made).
(j) 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.
(k) Neither Borrower nor any constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower.
(l) Except as expressly contemplated by the Loan Documents and the Cash Management Agency Agreement, Borrower will not commingle the funds and or other assets of Borrower with those of any Affiliate or constituent party or any other Person, and will hold all of its assets in its own name.
(m) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or constituent party or any other Person.
(n) Except as expressly contemplated by the Loan Documents with respect to the other Borrower, Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out to be responsible for or make have its assets credit available to satisfy or hold out its credit as being available to satisfy the debts or obligations of any other Person.
(i) If Borrower is a limited partnership or a limited liability company company, (other than a single member limited liability companycompany that satisfies all of the requirements of Section 3.1.24(o)(ii)), each general partner or managing member (each, an "“SPC Party"”) of Borrower shall be a corporation or single member limited liability company that satisfies all of the requirements of Section 3.1.24(o)(ii) whose sole asset is its a direct interest in Borrower of at least 0.5% (or 0.1% if Borrower is an entity formed under the laws of Delaware) and each such SPC Party will at all times comply, and will cause Borrower to comply, comply with each of the representations, warranties, and covenants contained in this Section 3.1.24 as if such representation, warranty or covenant was made directly by such SPC Party (substituting the term “SPC Party” for the term “Borrower” throughout) and will cause Borrower to comply with this Section 3.1.24 (except for subsections (a), (b), (d), (n) and (x)). Upon the withdrawal or the disassociation of an SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party whose articles of incorporation constituent documents are substantially similar to those of such the withdrawing or disassociating SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners. If Borrower is a limited partnership, Borrower shall have at least one general partner. If Borrower is a limited liability company (other than a single-member limited liability company that satisfies all of the requirements of Section 3.l.24(o)(ii)), Borrower shall have at least one (1) managing member. An SPC Party shall be organized for the sole purpose of owning a direct interest in the Borrower, shall own no other interests in any entity, and shall not incur indebtedness except as it may be liable for the debts of the Borrower in its capacity as general partner of the Borrower.
(ii) If Borrower is a single member limited liability company (“single member limited liability company” meaning a limited liability company having only one equity member), Borrower shall be a limited liability company organized under the laws of Delaware and shall have either (A) two (2) non-equity members or (B) at least two springing members, one of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member.
(p) Borrower or its SPC Party shall at all times cause there to be at least two duly appointed members of the board of directors (or two special managers if Borrower is a limited liability company) Independent Directors, who are provided by a nationally-nationally recognized company that provides professional independent directors (eachdirectors, an "Independent Director") of each SPC Party and of Borrower reasonably satisfactory to Lender if Borrower is a single member limited liability company. As used herein, “Independent Director” shall mean a natural person serving as a director of a corporation or manager of a limited liability company who shall is not have been at the time of such individual's appointment initial appointment, or at any time while serving as a director or manager of such SPC Party and Borrowerserving, and may has not have been at any time during the preceding five years (i5) years: (a) a stockholder, stockholder or director (other than with the exception of serving as the Independent Director of Borrower or any SPC Party that is an Independent DirectorSPC Party or managing member of Borrower), trustee, officer, employee, partner, member, attorney or counsel of such SPC Party, Borrower or any Affiliate affiliate of either of them, ; (iib) a creditor, customer, supplier or other Person person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate affiliate of either of them, ; (iiic) a Person person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, Person excluded from serving as Independent Director under subparagraph (a) or (ivb); or (d) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower shall not be disqualified Person excluded from serving as an Independent Director if such individual is at the time of initial appointment, under subparagraph (a) or at any time while serving as an Independent Director, an Independent Director of a "special purpose entity" affiliated with the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special membersb). As used in this definition, the term "“affiliate” means any person controlling, under common control with, or controlled by the person in question; and the term “control" ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Personperson or entity, whether through ownership of voting securities, by contract or otherwise.
. A natural person who satisfies the foregoing definition other than subparagraph (qb) Borrower shall not cause be disqualified from serving as an Independent Director if such individual has been provided by a nationally-recognized company that provides professional independent directors. A natural person who otherwise satisfies the foregoing definition except for being the Independent Director of a “special purpose entity” affiliated with Borrower or permit the board of directors of any SPC Party and Borrower 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 or under any organizational document shall not be disqualified from serving as an Independent Director of Borrower or SPC Party, requires Party if such “special purpose entity” does not own a vote of the board of directors direct or managers of each SPC Party and Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) Borrower shall conduct its business so that the assumptions made with respect to Borrower indirect equity interest in the Insolvency Opinion shall be true and correct in all respects. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or in any other Person) co-borrower of Borrower and if such individual is an independent director provided by a nationally-recognized company that provides professional independent directors. For purposes of this paragraph, a “special purpose entity” is an entity, whose organizational documents contain restrictions on its activities substantially similar to those set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in Section 3.1.24 of this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC PartyAgreement.
(s) Borrower will not permit any Affiliate or constituent party access to its bank accounts except as required for the conduct of Borrower's business.
(t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.
Appears in 1 contract
Single Purpose. Borrower hereby represents and warrants to, and covenants with, Lender that as of the date hereof and until such time as the Debt shall be paid in full:
(a1) Propco Borrower does not own and will not own any asset or property other than (i) the Property, and (ii) incidental personal property necessary for the ownership or operation of the Property and (2) Opco Borrower does not own and will not own any asset or property other than the personalty and other assets owned by it necessary for the operation of the Property.
(b1) Propco Borrower has not conducted any business other than in connection with this Agreement and will not engage in any business other than the ownership, management and operation of the Property and (2) Opco Borrower will not engage in any business other than the management and operation of the Property, and each Borrower will conduct and operate its business as presently conducted and operated.
(c) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair commercially reasonable (taking into account all facts and circumstances) and either substantially similar to those that would be available on an armsaim’s-length basis with third parties other than any such partyparty or a capital contribution or distribution.
(d) Borrower has not incurred incurred, and will not incur any Indebtedness other than (i) the Debt, (ii) unsecured trade payables and operational debt not evidenced by a note and (iii) Indebtedness incurred in the financing of equipment and other personal property used on the Property; provided that any Indebtedness incurred pursuant to subclauses (ii) and (iii) shall be (x) not in excess of Four Million and No/100 Dollars ($4,000,000.00) 5% of the outstanding principal amount of the Loan in the aggregate, (y) paid not more than sixty (60) days from the date incurred as to the matters in subclause (ii) above and not more than sixty (60) days from the date due as to the matters in subclause (iii) above and (z) incurred in the ordinary course of business. No Indebtedness other than the Debt may be secured (subordinate or pari passu) by the PropertyProperty other than Indebtedness of the type described in and subject to the requirements of clause (iii) of this clause (d).
(e) Except as expressly contemplated by the Loan Documents with respect to the other Borrower and the Cross Borrower, Borrower has not made and will not make any loans or advances to any third party (including any Affiliate or constituent party), and shall not acquire obligations or securities of any of its Affiliates.
(f) Borrower is and will remain solvent and Borrower will pay all of its debts and liabilities (including, as applicable, a fairly allocated portion of shared personnel and overhead expenses) only from its own assets and as the same shall become due.
(g) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities applicable to Borrower and preserve its Borrower’s existence, and Borrower will not, nor will Borrower permit any 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 constituent party without the prior consent of Lender in any manner that (i) violates or makes such organizational documents inconsistent with the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's ’s consent.
(h) Borrower will maintain all of its books, records, financial statements (it being acknowledged that the agent under the Cash Management Agency Agreement shall be continuously able to produce separate balance sheets of the Borrowers) and (except as contemplated in the Cash Management Agency Agreement) bank accounts separate from those of its Affiliates and from those of any constituent partyother Person. Borrower's ’s assets will not be listed as assets on the financial statement of any other Person, provided, however, that Borrower's ’s assets may be included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation shall be made on such consolidated financial statements (and/or in Annual Reports on Form 10-K filed with U.S. Securities and Exchange Commission in which such financial statements are contained) to indicate the separateness of Borrower and such Affiliates and to indicate that Borrower's ’s assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person and (ii) such assets shall are continuously able to be listed on Borrower's ’s own separate balance sheet. Borrower will file its own tax returns (to the extent Borrower is required to file any such tax returns) and will not file a consolidated federal income tax return with any other Person). Borrower shall maintain its books, records, resolutions and agreements as official records.
(i) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of 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 as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks bearing its own namename (except with respect to payments or communications made on behalf of the Borrower by the counterparty to the Cash Management Agency Agreement, in which event, such counterparty shall nevertheless identify the Borrower as the party on whose behalf the payment or communication is being made).
(j) 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.
(k) Neither Borrower nor any constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower.
(l) Except as expressly contemplated by the Loan Documents and the Cash Management Agency Agreement, Borrower will not commingle the funds and or other assets of Borrower with those of any Affiliate or constituent party or any other Person, and will hold all of its assets in its own name.
(m) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or constituent party or any other Person.
(n) Except as expressly contemplated by the Loan Documents with respect to the other Borrower and the Cross Borrower, Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out to be responsible for or make have its assets credit available to satisfy or hold out its credit as being available to satisfy the debts or obligations of any other Person.
(i) If Borrower is a limited partnership or a limited liability company company, (other than a single member limited liability companycompany that satisfies all of the requirements of Section 3.1.24(o)(ii)), each general partner or managing member (each, an "“SPC Party"”) of Borrower shall be a corporation or single member limited liability company that satisfies all of the requirements of Section 3.1.24(o)(ii) whose sole asset is its a direct interest in Borrower of at least 0.5% (or 0.1% if Borrower is an entity formed under the laws of Delaware) and each such SPC Party will at all times comply, and will cause Borrower to comply, comply with each of the representations, warranties, and covenants contained in this Section 3.1.24 as if such representation, warranty or covenant was made directly by such SPC Party (substituting the term “SPC Party” for the term “Borrower” throughout) and will cause Borrower to comply with this Section 3.1.24 (except for subsections (a), (b), (d), (n) and (x)). Upon the withdrawal or the disassociation of an SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party whose articles of incorporation constituent documents are substantially similar to those of such the withdrawing or disassociating SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners. If Borrower is a limited partnership, Borrower shall have at least one general partner. If Borrower is a limited liability company (other than a single-member limited liability company that satisfies all of the requirements of Section 3.1 .24(o)(ii)), Borrower shall have at least one (1) managing member. An SPC Party shall be organized for the sole purpose of owning a direct interest in the Borrower, shall own no other interests in any entity, and shall not incur indebtedness except as it may be liable for the debts of the Borrower in its capacity as general partner of the Borrower.
(ii) If Borrower is a single member limited liability company (“single member limited liability company” meaning a limited liability company having only one equity member), Borrower shall be a limited liability company organized under the laws of Delaware and shall have either (A) two (2) non-equity members or (B) at least two springing members, one of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member.
(p) Borrower or its SPC Party shall at all times cause there to be at least two duly appointed members of the board of directors (or two special managers if Borrower is a limited liability company) Independent Directors, who are provided by a nationally-nationally recognized company that provides professional independent directors (eachdirectors, an "Independent Director") of each SPC Party and of Borrower reasonably satisfactory to Lender if Borrower is a single member limited liability company. As used herein, “Independent Director” shall mean a natural person serving as a director of a corporation or manager of a limited liability company who shall is not have been at the time of such individual's appointment initial appointment, or at any time while serving as a director or manager of such SPC Party and Borrowerserving, and may has not have been at any time during the preceding five years (i5) years: (a) a stockholder, stockholder or director (other than with the exception of serving as the Independent Director of Borrower or any SPC Party that is an Independent DirectorSPC Party or managing member of Borrower), trustee, officer, employee, partner, member, attorney or counsel of such SPC Party, Borrower or any Affiliate affiliate of either of them, ; (iib) a creditor, customer, supplier or other Person person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate affiliate of either of them, ; (iiic) a Person person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, Person excluded from serving as Independent Director under subparagraph (a) or (ivb); or (d) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower shall not be disqualified Person excluded from serving as an Independent Director if such individual is at the time of initial appointment, under subparagraph (a) or at any time while serving as an Independent Director, an Independent Director of a "special purpose entity" affiliated with the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special membersb). As used in this definition, the term "“affiliate” means any person controlling, under common control with, or controlled by the person in question; and the term “control" ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Personperson or entity, whether through ownership of voting securities, by contract or otherwise.
. A natural person who satisfies the foregoing definition other than subparagraph (qb) Borrower shall not cause be disqualified from serving as an Independent Director if such individual has been provided by a nationally-recognized company that provides professional independent directors. A natural person who otherwise satisfies the foregoing definition except for being the Independent Director of a “special purpose entity” affiliated with Borrower or permit the board of directors of any SPC Party and Borrower 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 or under any organizational document shall not be disqualified from serving as an Independent Director of Borrower or SPC Party, requires Party if such “special purpose entity” does not own a vote of the board of directors direct or managers of each SPC Party and Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) Borrower shall conduct its business so that the assumptions made with respect to Borrower indirect equity interest in the Insolvency Opinion shall be true and correct in all respects. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or in any other Person) co-borrower of Borrower and if such individual is an independent director provided by a nationally-recognized company that provides professional independent directors. For purposes of this paragraph, a “special purpose entity” is an entity, whose organizational documents contain restrictions on its activities substantially similar to those set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in Section 3.1.24 of this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC PartyAgreement.
(s) Borrower will not permit any Affiliate or constituent party access to its bank accounts except as required for the conduct of Borrower's business.
(t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.
Appears in 1 contract
Single Purpose. Borrower hereby represents and warrants to, and covenants with, Lender that as of the date hereof and until such time as the Debt shall be paid in full:
(a) Borrower does not own and will not own any asset or property other than (i) the PropertyIndividual Properties, and (ii) incidental personal property necessary for the ownership or operation of the PropertyIndividual Properties.
(b) Borrower has not conducted any business other than in connection with this Agreement and will not engage in any business other than the ownership, management and operation of the Property and Borrower will conduct and operate its business as presently conducted and operatedIndividual Properties.
(c) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arms-length basis with third parties other than any such party.
(d) Borrower has not incurred any Indebtedness outstanding on the date 0hereof, and will not hereafter incur any Indebtedness Indebtedness, in each case, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation) other than (i) the Debt, (ii) unsecured trade payables and operational debt not evidenced by a note and incurred in the ordinary course of business, (iii) Indebtedness debt incurred in the connection with capital lease obligations and purchase money financing of with respect to equipment and other personal property used on the Property; provided that any Individual Properties, provided, however with respect to the Indebtedness referred to in subclauses (ii) and (iii), (A) the same is not secured by a lien or security interest in the Individual Properties (other than the personal property so financed) and (B) the amount of all Indebtedness in the aggregate incurred pursuant to subclauses (ii) and (iii) ), shall be (x) not in excess of Four Million and No/100 Dollars (exceed $4,000,000.00) 20,000,000 in the aggregateaggregate at any one time outstanding (the Indebtedness referred to in clauses (i), (y) paid not more than sixty (60) days from the date incurred as to the matters in subclause (ii) above and not more than sixty (60) days from the date due as to the matters in subclause (iii) above and (z) incurred in ), the ordinary course of business"PERMITTED INDEBTEDNESS"). No Indebtedness other than the Debt may be secured (subordinate or pari passuPARI PASSU) by the PropertyIndividual Properties.
(e) Borrower has not made and will not make any loans or advances to any third party (including any Affiliate or constituent party), and shall not acquire obligations or securities of its Affiliates.
(f) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expensesexpenses of which Borrower will pay its allocated share) from its assets as the same shall become due.
(g) 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 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 constituent party without the prior consent of Lender in any manner that (i) violates the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's consent.
(h) Except to the extent permitted under the Loan Documents, Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any constituent party. Borrower's Borrower will prepare separate financial statements, showing its assets will and liabilities separate and apart from those of any other Person, and not be have its assets listed as assets on the financial statement of any other Person, provided, however, that Borrower's assets may be included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation shall be made on such consolidated financial statements to indicate the separateness of Borrower and such Affiliates and to indicate that Borrower's assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person and (ii) such assets shall be listed on Borrower's own separate balance sheet. Borrower will file its own tax returns (to the extent Borrower is required to file any such tax returns) and will not file a consolidated federal income tax return with any other Person. Borrower shall maintain its books, records, resolutions and agreements as official records.
(i) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of 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 as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks bearing its own name.
(j) 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.
(k) Neither Borrower nor any constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower.
(l) Borrower will not commingle the funds and other assets of Borrower with those of any Affiliate or constituent party or any other Person, and will hold all of its assets in its own name.
(m) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or constituent party or any other Person.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out to be responsible for or make its assets available to satisfy the debts or obligations of any other Person.
(i) If Borrower is a limited partnership or a limited liability company (other than a single member limited liability company), each general partner or managing member (each, an "SPC Party") shall be a corporation 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 3.1.24 as if such representation, warranty or covenant was made directly unless required by such SPC Party. Upon the withdrawal or the disassociation of an SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party whose articles of incorporation are substantially similar to those of such SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners.
(ii) If Borrower is a single member limited liability company, Borrower shall have at least two springing members, one of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member.
(p) Borrower shall at all times cause there to be at least two duly appointed members of the board of directors (or two special managers if Borrower is a limited liability company) who are provided by a nationally-recognized company that provides professional independent directors (each, an "Independent Director") of each SPC Party and Borrower reasonably satisfactory to Lender who shall not have been at the time of such individual's appointment or at any time while serving as a director or manager of such SPC Party and Borrower, and may not have been at any time during the preceding five years (i) a stockholder, director (other than as an Independent Director), officer, employee, partner, attorney or counsel of such SPC Party, Borrower or any Affiliate of either of them, (ii) a customer, supplier or other Person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate of either of them, (iii) a Person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, or (iv) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower 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 the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special members. As used in this definition, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwise.
(q) Borrower shall not cause or permit the board of directors of any SPC Party and Borrower 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 or under any organizational document of Borrower or SPC Party, requires a vote of the board of directors or managers of each SPC Party and Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) 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. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC Party.
(s) Borrower will not permit any Affiliate or constituent party access to its bank accounts except as required for the conduct of Borrower's business.
(t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.
Appears in 1 contract
Sources: Loan Agreement (Hilton Hotels Corp)
Single Purpose. Borrower hereby represents and warrants to, and covenants with, to Lender that as of the date hereof and covenants with Lender that until such time as the Debt shall be paid in full:full (unless otherwise hereafter consented to by Lender after receiving a Rating Agency Confirmation):
(a) Borrower does not own and will not own any asset or property other than (i) the Property, and (ii) incidental personal property necessary for the ownership or operation of the Property, and (iii) the Permitted Investments, cash and cash equivalents.
(b) Borrower has not conducted any business other than in connection with this Agreement and will not engage in any business other than the ownership, management and operation of the Property and Borrower will conduct and operate its business as presently conducted and operatedoperated in all material respects.
(c) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arms-length basis with third parties other than any such party.
(d) Borrower has not incurred no outstanding Indebtedness for borrowed money and will not incur any Indebtedness other than (i) the Debt, (ii) unsecured trade payables and operational debt not evidenced by a note and in an aggregate amount not exceeding $2,500,000 at any one time and (iii) Indebtedness incurred in the financing of equipment and other personal property used on the PropertyProperty in an aggregate amount not exceeding $500,000 at any one time; provided that any Indebtedness incurred pursuant to subclauses (ii) and (iii) shall be (x) not in excess of Four Million and No/100 Dollars ($4,000,000.00) in the aggregate, (y) paid not more than sixty ninety (6090) days from the date incurred as to the matters in subclause (ii) above past due and not more than sixty (60) days from the date due as to the matters in subclause (iii) above and (z) incurred in the ordinary course of business. No Indebtedness other than the Debt may be secured (subordinate or pari passuPARI PASSU) by the Property, except that any permitted equipment financing may be secured by such equipment.
(e) Borrower has not made and will not make any loans or advances in the nature of loans to any third party (including any Affiliate or constituent party), and shall not acquire obligations or securities of its Affiliates.
(f) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its assets as the same shall become due.
(g) 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 constituent party to 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 constituent party the SPC Party without the prior consent of Lender in any manner that (i) violates the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan or the Mezzanine Loan is outstanding or by its terms cannot be modified without Lender's consent.
(h) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any constituent party. Borrower's assets will not be listed as assets on the financial statement of any other Person, ; provided, however, that Borrower's assets may be included in a consolidated financial statement of its Affiliates provided that if (i) appropriate notation shall be made inclusion on such a consolidated financial statement is required to comply with the requirements of GAAP, (ii) such consolidated financial statements shall contain a footnote to indicate the separateness of Borrower and such Affiliates and to indicate effect that Borrower's assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person owned by Borrower, and (iiiii) such assets shall be listed on Borrower's own separate balance sheet. Except as permitted under the preceding sentence, Borrower's assets will not be listed as assets on the financial statement of any other entity; provided, however, that such restriction shall not preclude any Person from listing its ownership interests in Borrower as an asset on its financial statement. Borrower will file its own tax returns (to the extent Borrower is required to file any such tax returns) and will not file a consolidated federal income tax return with any other PersonPerson unless specifically mandated by applicable law or unless Borrower is treated as a disregarded entity. Borrower shall maintain its books, records, resolutions and agreements as official records.
(i) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of 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 as a division or part of the other and shall maintain and utilize a separate telephone number (which may be a telephone number at the Property) and separate stationery, invoices and checks bearing its own name.
(j) 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.
(k) Neither Borrower nor any constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower.
(l) Borrower will not commingle the funds and other assets of Borrower with those of any Affiliate or constituent party or any other Person, and will hold all of its assets in its own name.
(m) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or constituent party or any other Person.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out to be responsible for or make have its assets credit available to satisfy the debts or obligations of any other Person.
(io) If Each entity comprising Borrower is a limited partnership or a Delaware limited liability company that (other than i) has Mezzanine Borrower as its only member and (ii) has a single non-member limited liability company), each general partner or managing member manager that is a Delaware corporation (each, an the "SPC PartyPARTY") shall be a corporation whose sole asset is its interest in Borrower and each such ). The 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 3.1.24 as if such representation, warranty or covenant was made directly by such the SPC Party, except that the SPC Party shall not be required to maintain a separate telephone number from that utilized by Borrower. Upon the withdrawal or the disassociation of an the SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party whose articles of incorporation are substantially similar to those of such the SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners.
(ii) If Borrower is a single member limited liability company, Borrower shall have at least two springing members, one of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member.
(p) Borrower shall at all times cause there to be at least two duly appointed members of the board of directors (or two special managers if Borrower is a limited liability company) who are provided by a nationally-recognized company that provides professional independent directors (each, an "Independent DirectorINDEPENDENT DIRECTOR") of each the SPC Party and Borrower reasonably satisfactory to Lender who shall not have been at the time of such individual's appointment or at any time while serving as a director or manager of such SPC Party and Borrowerappointment, and may not have been at any time during the preceding five years years, (i) a stockholder, director (other than as an Independent Director)director, officer, employee, partner, attorney or counsel of such SPC Partycorporation, Borrower or any Affiliate of either of them, (ii) a customer, supplier or other Person who derives any of its purchases or revenues from its activities with such SPC Partycorporation, Borrower or any Affiliate of either of them, (iii) a Person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, or (iv) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower 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 the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special members. As used in this definition, the term "controlCONTROL" means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwise.
(q) Borrower shall not cause or permit the board of directors of any SPC Party and Borrower 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 or under any organizational document of Borrower or SPC Party, requires a vote of the board of directors or managers of each SPC Party and Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) 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. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC Party.
(s) Borrower will not permit any Affiliate or constituent party access to its bank accounts except as required for the conduct of Borrower's business.
(t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.
Appears in 1 contract
Single Purpose. (a) Borrower hereby represents and warrants to, and covenants withthat, Lender that once the date of Borrower’s formation and until the date hereof, Borrower has operated as a single purpose entity and has complied with all provisions of Borrower’s limited liability company operating agreement, including, without limitation, the special purpose provisions contained in Section 9(j) of such agreement.
(b) Borrower hereby represents and warrants, and covenants that, as of the date hereof and until such time as the Debt shall be paid in full, Borrower, Mortgage Borrower and First Mezzanine Borrower:
(ai) Borrower does do not own and will not own any asset or property other than (i) operation of its property or its ownership interests in Mortgage Borrower or First Mezzanine Borrower or the Property, and as applicable;
(ii) incidental personal property necessary for the ownership or operation of the Property.
(b) Borrower has do not conducted any business other than in connection with this Agreement and will not engage in any business other than the ownership, management and operation ownership of the Property Collateral, the First Mezzanine Collateral or the Property, as applicable, and Borrower will conduct and operate its business as presently proposed to be conducted and operated., subject to expanded operations and management in connection with the Condominium Documents;
(ciii) except for capital contributions and capital distributions permitted under the terms of this Agreement and properly reflected on the books of records of Borrower, First Mezzanine Borrower and/or Mortgage Borrower and, with respect to Mortgage Borrower, the Heritage Intercompany Loan, the Development Fee, and the Deferred Development Fee, have not and will not enter into any contract or agreement with any Affiliate of BorrowerAffiliate, any constituent party of Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an armsarm’s-length basis with third parties other than any such party.;
(div) Borrower has have not incurred and will not incur any Indebtedness Indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation) other than (iA) the DebtLoan, with respect to Borrower, the First Mezzanine Loan, with respect to First Mezzanine Borrower, and the Mortgage Loan, with respect to Mortgage Borrower, (iiB) unsecured trade payables and operational debt not evidenced by a note with respect to Mortgage Borrower, the Heritage Intercompany Loan and (iiiC) Indebtedness liabilities incurred in the financing ordinary course of equipment and other personal property used on the Property; provided that any Indebtedness incurred pursuant Borrower’s business in amounts not to subclauses (ii) and (iii) shall be (x) not in excess of Four Million and No/100 Dollars ($4,000,000.00) exceed in the aggregateaggregate $2,000,000.00, (y) paid when combined with liabilities of Mortgage Borrower and Second Mezzanine Borrower incurred in the ordinary course of their respective businesses), which liabilities are not more than sixty (60) days from past the date incurred as to the matters in subclause (ii) above incurred, are not evidenced by a note and not more than sixty (60) days from the date due as to the matters in subclause (iii) above are paid when due; and (z) incurred in the ordinary course of business. No no Indebtedness other than the Debt may be secured (subordinate subordinate, pari passu or pari passuotherwise) by the Collateral, the First Mezzanine Collateral or the Property., as applicable;
(ev) Borrower has have not made and will not make any loans or advances to any third party (including any Affiliate or constituent party), and shall not acquire obligations or securities of its Affiliates.;
(fvi) Borrower is are and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its their respective assets as the same shall become due.;
(gvii) Borrower has have done or have caused to be done and will do all things necessary to observe organizational formalities and preserve its each of their existence, and Borrower will not, nor will Borrower permit any constituent party to to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, certificate of formation, operating agreement, trust agreement or other organizational documents of Borrower or such constituent party without the prior consent of Lender in any manner that (i) violates the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's consent.;
(hviii) Borrower will maintain all of its books, records, financial statements and bank accounts as official records, separate from those of its Affiliates and any constituent party. Borrower's assets party and will not permit its assets to be listed as assets on the financial statement of any other Person, entity; provided, however, that Borrower's ’s, Mortgage Borrower’s and First Mezzanine Borrower’s assets may be included in a consolidated financial statement of its Affiliates Affiliate provided that (ia) appropriate notation shall be made on such consolidated financial statements to indicate the separateness of the Borrower, Mortgage Borrower and and/or First Mezzanine Borrower from such Affiliates Affiliate and to indicate that Borrower's ’s, Mortgage Borrower’s and/or First Mezzanine Borrower’s assets and credit credit, as applicable, are not available to satisfy the debts and other obligations of such Affiliates Affiliate or any other Person and (iib) such assets shall also be listed on the Borrower's ’s, Mortgage Borrower’s and/or First Mezzanine Borrower’s own separate balance sheet. Borrower will file its own tax returns (to the extent Borrower is required to file any such tax returns) and will not file a consolidated federal income tax return with any other Person. Borrower shall maintain its books, records, resolutions and agreements as official records.;
(iix) Borrower will be, and at all times will hold itself themselves out to the public as, a legal entity entities separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of Borrowerparty), shall correct any known misunderstanding regarding its their status as a separate entityentities, shall conduct business in its their own name, shall not identify itself themselves or any of its their Affiliates as a division or part of the other and shall maintain and utilize a separate telephone number and separate stationery, invoices and checks bearing its their own name.;
(jx) Borrower will maintain adequate capital and a sufficient number of employees for the normal obligations reasonably foreseeable in a business of its their respective size and character and in light of its their respective contemplated business operations.;
(kxi) Neither Borrower will not seek or effect nor permit any constituent party will to seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower.any of them;
(lxii) Borrower will not commingle the their respective funds and other assets of Borrower with those of any Affiliate or constituent party or any other Person, and will hold all of its their respective assets in its own name.;
(mxiii) Borrower has and will maintain its their respective assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its their respective individual assets from those of any Affiliate or constituent party or any other Person.;
(nxiv) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself themselves out to be responsible for or make its assets have their respective credit available to satisfy the debts or obligations of any other Person;
(xv) will not permit any Affiliate or constituent party independent access to their respective bank accounts;
(xvi) if they respectively employ any employees of their own, will pay the salaries of any such employees from their own respective funds;
(xvii) will compensate each of their own consultants and agents from their funds for services provided to them and pay from their own assets all obligations of any kind incurred, including shared overhead expenses;
(xviii) will not pledge each of their assets to secure the obligations of any other Person;
(xix) will not form, acquire or hold any subsidiary (whether corporate, partnership, limited liability company or other) or own any equity interest in any other entity other than, with respect to Borrower, First Mezzanine Borrower or Mortgage Borrower;
(xx) will allocate fairly and reasonably any overhead expenses that are shared with any affiliate, including for shared office space and for services performed by any employee of an affiliate;
(xxi) will file their own respective tax returns, except to the extent Borrower, Mortgage Borrower or First Mezzanine Borrower is a “disregarded entity” for tax purposes;
(xxii) will cause the managers, agents and other representatives of the Borrower, First Mezzanine Borrower and/or Mortgage Borrower, as applicable to act at all times with respect to the First Mezzanine Borrower, Mortgage Borrower and/or Borrower, as applicable in furtherance of the foregoing and in the best interests of the Borrower, First Mezzanine Borrower and Mortgage Borrower; and
(xxiii) will not buy or hold evidence of indebtedness issued by any other Person (other than cash or investment-grade securities).
(i) If Borrower is a limited partnership or a limited liability company company, (other than a single member limited liability company), each general partner or managing member (each, an "“SPC Party"”) shall be a corporation 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 3.1.24 as if such representation, warranty or covenant was made directly by such SPC Party. Upon the withdrawal or the disassociation of an SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party whose articles of incorporation are substantially similar to those of such SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners.
(ii) If Borrower is a single member Delaware limited liability company, Borrower shall have at least two springing members, one each of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole a member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member.
(pd) Borrower shall at all times cause there to be at least two one (1) duly appointed members member of the board of directors (or two special independent managers if Borrower who is a limited liability company) who are provided by a nationally-nationally recognized company that provides professional independent directors (each, an "“Independent Director"”) and professional independent managers (each, an “Independent Manager”) of each Borrower or any such SPC Party and Borrower reasonably satisfactory to Lender who shall not have been at the time of such individual's ’s appointment or at any time while serving as a director or manager of such SPC Party and or Borrower, and may not have been at any time during the preceding five (5) years (i) a stockholder, director (other than as an Independent Director), officer, member, trustee, employee, partner, attorney or counsel of such SPC Party, Borrower or any Affiliate of either of them, (ii) a creditor, customer, supplier or other Person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate of either of them, (iii) a Person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, or (iv) a member of the immediate family by blood or marriage of any such stockholder, director, officer, member, trustee, employee, partner, creditor, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower 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 the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special members. As used in this definition, the term "“control" ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwise.
(qe) Borrower shall not cause or permit the board of directors of any SPC Party and Borrower 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 or under any organizational document of Borrower or SPC Party, requires a vote of the board of directors or managers of each SPC Party and Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) 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. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC Party.
(s) Borrower will not permit any Affiliate or constituent party access to its bank accounts except as required for the conduct of Borrower's business.
(t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.
Appears in 1 contract
Sources: Second Mezzanine Loan Agreement (KBS Real Estate Investment Trust, Inc.)
Single Purpose. Borrower hereby represents and warrants to, and covenants with, Lender that as of the date hereof and until such time as the Debt shall be paid in full:
(a) Fee Borrower does and Leasehold Borrower do not own and will not own any asset or property other than (i) their respective interests in the Property, and (ii) incidental personal property necessary for the ownership or operation of the Property.
(b) Borrower has not conducted any business other than in connection with this Agreement and will not engage in any business other than the ownership, management and operation of the Property and Borrower will conduct and operate its business as presently conducted and operated.
(c) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arms-length basis with third parties other than any such party.
(d) Borrower has not incurred and will not incur any Indebtedness other than (i) the Debt, (ii) unsecured trade payables and operational debt not evidenced by a note and (iii) Indebtedness incurred in the financing of equipment and other personal property used on the Property; provided that any Indebtedness incurred pursuant to subclauses (ii) and (iii) shall be (x) not in excess of Four Million and No/100 Dollars ($4,000,000.00) in the aggregate, (y) paid not more than sixty (60) days from the date incurred as to the matters in subclause (ii) above and not more than sixty (60) days from the date due as to the matters in subclause (iii) above and (z) incurred in the ordinary course of business. No Indebtedness other than the Debt may be secured (subordinate or pari passu) by the Property.
(e) Borrower has not made and will not make any loans or advances to any third party (including any Affiliate or constituent party), and shall not acquire obligations or securities of its Affiliates.
(f) Fee Borrower is and Leasehold Borrower are and will remain solvent and Fee Borrower and Leasehold Borrower will pay its their respective debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its assets as the same shall become due.
(g) 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 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 constituent party without the prior consent of Lender in any manner that (i) violates the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's consent.
(h) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any constituent party. Borrower's assets will not be listed as assets on the financial statement of any other Person, provided, however, that Borrower's assets may be included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation shall be made on such consolidated financial statements to indicate the separateness of Borrower and such Affiliates and to indicate that Borrower's assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person and (ii) such assets shall be listed on Borrower's own separate balance sheet. Borrower will file its own tax returns (to the extent Borrower is required to file any such tax returns) and will not file a consolidated federal income tax return with any other Person. Borrower shall maintain its books, records, resolutions and agreements as official records.
(i) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of 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 as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks bearing its own name.
(j) 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.
(k) Neither Borrower nor any constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower.
(l) Borrower will not commingle the funds and other assets of Borrower with those of any Affiliate or constituent party or any other Person, and will hold all of its assets in its own name.
(m) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or constituent party or any other Person.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out to be responsible for or make its assets available to satisfy the debts or obligations of any other Person.
(i) If either of Fee Borrower or Leasehold Borrower is a limited partnership or a limited liability company (other than a single member limited liability company), each general partner or managing member (each, an "SPC Party") shall be a corporation whose sole asset is its interest in Fee Borrower or Leasehold Borrower, as applicable, and each such SPC Party will at all times comply, and will cause Fee Borrower or Leasehold Borrower, as applicable, to comply, with each of the representations, warranties, and covenants contained in this Section 3.1.24 as if such representation, warranty or covenant was made directly by such SPC Party. Upon the withdrawal or the disassociation of an SPC Party from Fee Borrower or Leasehold Borrower, as applicable, Fee Borrower or Leasehold Borrower, as applicable, shall immediately appoint a new SPC Party whose articles of incorporation are substantially similar to those of such SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners.
(ii) If either of Fee Borrower or Leasehold Borrower is a single member limited liability company, Fee Borrower or Leasehold Borrower, as applicable, shall have at least two springing members, one of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Fee Borrower or Leasehold Borrower, as applicable, shall immediately become the sole member of Fee Borrower or Leasehold Borrower, as applicable, and the other of which shall become the sole member of Fee Borrower or Leasehold Borrower, as applicable, if the first such springing member no longer is available to serve as such sole member.
(p) Fee Borrower and Leasehold Borrower shall at all times cause there to be at least two duly appointed members of the board of directors (or two special managers if Fee Borrower or Leasehold Borrower is a limited liability company) who are provided by a nationally-recognized company that provides professional independent directors (each, an "Independent Director") of each SPC Party Party, Fee Borrower and Leasehold Borrower reasonably satisfactory to Lender who shall not have been at the time of such individual's appointment or at any time while serving as a director or manager of such SPC Party Party, Fee Borrower and Leasehold Borrower, and may not have been at any time during the preceding five years (i) a stockholder, director (other than as an Independent Director), officer, employee, partner, attorney or counsel of such SPC Party, Fee Borrower, Leasehold Borrower or any Affiliate of either of them, (ii) a customer, supplier or other Person who derives any of its purchases or revenues from its activities with such SPC Party, Fee Borrower, Leasehold Borrower or any Affiliate of either of them, (iii) a Person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, or (iv) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Fee Borrower or Leasehold Borrower that does not own a direct or indirect equity interest in the either Fee Borrower or Leasehold Borrower 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 the either Fee Borrower or Leasehold Borrower (other than any entity that owns a direct or indirect equity interest in the either Fee Borrower or Leasehold Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special members. As used in this definition, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwise.
(q) Borrower shall not cause or permit the board of directors of any SPC Party and Party, Fee Borrower or Leasehold Borrower 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 or under any organizational document of Fee Borrower, Leasehold Borrower or SPC Party, requires a vote of the board of directors or managers of each SPC Party Party, Fee Borrower and Leasehold Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) 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. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC Party.
(s) Borrower will not permit any Affiliate or constituent party access to its bank accounts except as required for the conduct of Borrower's business.
(t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.
Appears in 1 contract
Single Purpose. Borrower hereby represents has been formed for the sole purpose of owning and warrants to, operating the Collateral Asset. From and covenants with, Lender that as of after the date hereof and until such time as the Debt Loan shall be paid in full:
(ai) Borrower does has not own and will not own any asset or property other than (i) the PropertyCollateral Asset, and (ii) incidental personal property necessary for the ownership or operation of the PropertyCollateral Asset.
(bii) Borrower has not conducted any business other than in connection with this Agreement and will not engage in any business other than the ownership, management and operation of the Property Collateral Asset and Borrower will conduct and operate its business as presently conducted and operated.
(c) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arms-length basis with third parties other than any such party.
(diii) 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 (iX) the DebtLoan, (iiY) unsecured trade payables and operational debt not evidenced by a note and in an aggregate amount not exceeding $100,000 at any one time, and (iiiZ) Indebtedness indebtedness incurred in the financing of equipment and other personal property used on the Property; Collateral Asset with annual payments not exceeding $100,000 in the aggregate, provided that any Indebtedness indebtedness incurred pursuant to subclauses (iiY) and (iiiZ) shall be (x1) not in excess of Four Million and No/100 Dollars ($4,000,000.00) in the aggregate, (y) paid not more than sixty (60) days from the date incurred as to the matters in subclause (ii) above and not more than sixty (60) days from the date past due as to the matters in subclause (iii) above and (z2) incurred in the ordinary course of business. No Indebtedness indebtedness other than the Debt Loan may be secured (subordinate subordinate, pari passu or pari passuotherwise) by the PropertyCollateral Asset.
(eiv) Borrower has not made and will not make any loans or advances to any third party (including any Affiliate or constituent party), except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arm’s length basis with third parties other than any such party and upon terms acceptable to Lender in its sole discretion.
(v) Borrower shall not acquire obligations or securities of its Affiliates.
(fvi) As of the date hereof, Borrower is and will remain solvent and Borrower will is able to pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its assets as the same shall become due.
(gvii) 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 notneither party will, nor will Borrower it permit any constituent party to to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylawsformation, operating agreement, trust or other organizational documents of Borrower or such constituent party without the prior consent of Lender in any manner that (i) violates the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's consent6.14).
(hviii) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any constituent party. Except for Guarantor, Borrower's ’s assets will not be listed as assets on the financial statement of any other Person, provided, however, that Borrower's assets may be included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation shall be made on such consolidated financial statements to indicate the separateness of Borrower and such Affiliates and to indicate that Borrower's assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person and (ii) such assets shall be listed on Borrower's own separate balance sheet. Borrower will file its own tax returns (to the extent Borrower is required to file any such tax returns) and will not file a consolidated federal income tax return with any other Person. Borrower shall maintain its books, records, resolutions and agreements as official records.
(iix) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of Borrowerparty), 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 and separate stationery, invoices and checks bearing its own name.
(jx) Borrower will maintain maintains adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations.
(kxi) Neither Borrower Borrower, nor any constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower, or transfer or otherwise dispose of all or substantially all of its assets.
(lxii) Borrower will not commingle the its funds and other assets of Borrower with those of any Affiliate or constituent party or any other PersonPerson (provided, however, property manager of the Collateral Asset may do so), and will hold all of its assets in its own name, other than as permitted under the Loan Documents.
(mxiii) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or constituent party or any other Person.
(nxiv) Except for the Loan, Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out to be responsible for or make have its assets credit available to satisfy the debts or obligations of any other Person.
(i) If Borrower is a limited partnership or a limited liability company (other than a single member limited liability company), each general partner or managing member (each, an "SPC Party") shall be a corporation 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 3.1.24 as if such representation, warranty or covenant was made directly by such SPC Party. Upon the withdrawal or the disassociation of an SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party whose articles of incorporation are substantially similar to those of such SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners.
(ii) If Borrower is a single member limited liability company, Borrower shall have at least two springing members, one of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member.
(p) Borrower shall at all times cause there to be at least two duly appointed members of the board of directors (or two special managers if Borrower is a limited liability company) who are provided by a nationally-recognized company that provides professional independent directors (each, an "Independent Director") of each SPC Party and Borrower reasonably satisfactory to Lender who shall not have been at the time of such individual's appointment or at any time while serving as a director or manager of such SPC Party and Borrower, and may not have been at any time during the preceding five years (i) a stockholder, director (other than as an Independent Director), officer, employee, partner, attorney or counsel of such SPC Party, Borrower or any Affiliate of either of them, (ii) a customer, supplier or other Person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate of either of them, (iii) a Person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, or (iv) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower 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 the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special members. As used in this definition, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwise.
(q) Borrower shall not cause or permit the board of directors of any SPC Party and Borrower 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 or under any organizational document of Borrower or SPC Party, requires a vote of the board of directors or managers of each SPC Party and Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) 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. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC Party.
(sxv) Borrower will not permit any Affiliate or constituent party independent access to its bank accounts except as required for the conduct of Borrower's businessaccounts.
(txvi) Borrower shall will pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(uxvii) Borrower shall will compensate each of its consultants and agents from its funds generated by the Collateral Asset or from other sources for services provided to it and pay from its own assets all obligations of any kind incurredthe Collateral Asset.
Appears in 1 contract
Sources: Loan Agreement (Inland Diversified Real Estate Trust, Inc.)
Single Purpose. Borrower hereby represents and warrants to, and covenants with, Lender that as of the date hereof and until such time as the Debt shall be paid in full:
(a1) Propco Borrower does not own and will not own any asset or property other than (i) the Property, and (ii) incidental personal property necessary for the ownership or operation of the Property and (2) Opco Borrower does not own and will not own any asset or property other than the personalty and other assets owned by it necessary for the operation of the Property.
(b1) Propco Borrower has not conducted any business other than in connection with this Agreement and will not engage in any business other than the ownership, management and operation of the Property and (2) Opco Borrower will not engage in any business other than the management and operation of the Property, and each Borrower will conduct and operate its business as presently conducted and operated.
(c) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair commercially reasonable (taking into account all facts and circumstances) and either substantially similar to those that would be available on an armsarm’s-length basis with third parties other than any such partyparty or a capital contribution or distribution.
(d) Borrower has not incurred and will not incur any Indebtedness other than (i) the Debt, (ii) unsecured trade payables and operational debt not evidenced by a note and (iii) Indebtedness incurred in the financing of equipment and other personal property used on the Property; provided that any Indebtedness incurred pursuant to subclauses (ii) and (iii) shall be (x) not in excess of Four Million and No/100 Dollars ($4,000,000.00) 5% of the outstanding principal amount of the Loan in the aggregate, (y) paid not more than sixty (60) days from the date incurred as to the matters in subclause (ii) above and not more than sixty (60) days from the date due as to the matters in subclause (iii) above and (z) incurred in the ordinary course of business. No Indebtedness other than the Debt may be secured (subordinate or pari passu) by the PropertyProperty other than Indebtedness of the type described in and subject to the requirements of clause (iii) of this clause (d).
(e) Except as expressly contemplated by the Loan Documents with respect to the other Borrower, Borrower has not made and will not make any loans or advances to any third party (including any Affiliate or constituent party), and shall not acquire obligations or securities of any of its Affiliates.
(f) Borrower is and will remain solvent and Borrower will pay all of its debts and liabilities (including, as applicable, a fairly allocated portion of shared personnel and overhead expenses) only from its own assets and as the same shall become due.
(g) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities applicable to Borrower and preserve its Borrower’s existence, and Borrower will not, nor will Borrower permit any 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 constituent party without the prior consent of Lender in any manner that (i) violates or makes such organizational documents inconsistent with the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's ’s consent.
(h) Borrower will maintain all of its books, records, financial statements (it being acknowledged that the agent under the Cash Management Agency Agreement shall be continuously able to produce separate balance sheets of the Borrowers) and (except as contemplated in the Cash Management Agency Agreement) bank accounts separate from those of its Affiliates and from those of any constituent partyother Person. Borrower's ’s assets will not be listed as assets on the financial statement of any other Person, provided, however, that Borrower's ’s assets may be maybe, included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation shall be made on such consolidated financial statements (and/or in Annual Reports on Form 10-K filed with U.S. Securities and Exchange Commission in which such financial statements are contained) to indicate the separateness of Borrower and such Affiliates and to indicate that Borrower's ’s assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person and (ii) such assets shall are continuously able to be listed on Borrower's ’s own separate balance sheet. Borrower will file its own tax returns (to the extent Borrower is required to file any such tax returns) and will not file a consolidated federal income tax return with any other Person). Borrower shall maintain its books, records, resolutions and agreements as official records.
(i) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of 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 as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks bearing its own namename (except with respect to payments or communications made on behalf of the Borrower by the counterparty to the Cash Management Agency Agreement, in which event, such counterparty shall nevertheless identify the Borrower as the party on whose behalf the payment or communication is being made).
(j) 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.
(k) Neither Borrower nor any constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower.
(l) Except as expressly contemplated by the Loan Documents and the Cash Management Agency Agreement, Borrower will not commingle the funds and or other assets of Borrower with those of any Affiliate or constituent party or any other Person, and will hold all of its assets in its own name.
(m) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or constituent party or any other Person.
(n) Except as expressly contemplated by the Loan Documents with respect to the other Borrower, Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out to be responsible for or make have its assets credit available to satisfy or hold out its credit as being available to satisfy the debts or obligations of any other Person.
(i) If Borrower is a limited partnership or a limited liability company company, (other than a single member limited liability companycompany that satisfies all of the requirements of Section 3.l.24(o)(ii)), each general partner or managing member (each, an "“SPC Party"”) of Borrower shall be a corporation or single member limited liability company that satisfies all of the requirements of Section 3.1.24(o)(ii) whose sole asset is its a direct interest in Borrower of at least 0.5% (or 0.1% if Borrower is an entity formed under the laws of Delaware) and each such SPC Party will at all times comply, and will cause Borrower to comply, comply with each of the representations, warranties, and covenants contained in this Section 3.1.24 as if such representation, warranty or covenant was made directly by such SPC Party (substituting the term “SPC Party” for the term “Borrower” throughout) and will cause Borrower to comply with this Section 3.1.24 (except for subsections (a), (b), (d), (n) and (x)). Upon the withdrawal or the disassociation of an SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party whose articles of incorporation constituent documents are substantially similar to those of such the withdrawing or disassociating SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners. If Borrower is a limited partnership, Borrower shall have at least one general partner. If Borrower is a limited liability company (other than a single-member limited liability company that satisfies all of the requirements of Section 3.1.24(o)(ii)), Borrower shall have at least one (1) managing member. An SPC Party shall be organized for the sole purpose of owning a direct interest in the Borrower, shall own no other interests in any entity, and shall not incur indebtedness except as it may be liable for the debts of the Borrower in its capacity as general partner of the Borrower.
(ii) If Borrower is a single member limited liability company (“single member limited liability company” meaning a limited liability company having only one equity member), Borrower shall be a limited liability company organized under the laws of Delaware and shall have either (A) two (2) non-equity members or (B) at least two springing members, one of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member.
(p) Borrower or its SPC Party shall at all times cause there to be at least two duly appointed members of the board of directors (or two special managers if Borrower is a limited liability company) Independent Directors, who are provided by a nationally-nationally recognized company that provides professional independent directors (eachdirectors, an "Independent Director") of each SPC Party and of Borrower reasonably satisfactory to Lender if Borrower is a single member limited liability company. As used herein, “Independent Director” shall mean a natural person serving as a director of a corporation or manager of a limited liability company who shall is not have been at the time of such individual's appointment initial appointment, or at any time while serving as a director or manager of such SPC Party and Borrowerserving, and may has not have been at any time during the preceding five years (i5) years: (a) a stockholder, stockholder or director (other than with the exception of serving as the Independent Director of Borrower or any SPC Party that is an Independent DirectorSPC Party or managing member of Borrower), trustee, officer, employee, partner, member, attorney or counsel of such SPC Party, Borrower or any Affiliate affiliate of either of them, ; (iib) a creditor, customer, supplier or other Person person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate affiliate of either of them, ; (iiic) a Person person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, Person excluded from serving as Independent Director under subparagraph (a) or (ivb); or (d) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower shall not be disqualified Person excluded from serving as an Independent Director if such individual is at the time of initial appointment, under subparagraph (a) or at any time while serving as an Independent Director, an Independent Director of a "special purpose entity" affiliated with the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special membersb). As used in this definition, the term "“affiliate” means any person controlling, under common control with, or controlled by the person in question; and the term “control" ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Personperson or entity, whether through ownership of voting securities, by contract or otherwise.
. A natural person who satisfies the foregoing definition other than subparagraph (qb) Borrower shall not cause be disqualified from serving as an Independent Director if such individual has been provided by a nationally-recognized company that provides professional independent directors. A natural person who otherwise satisfies the foregoing definition except for being the Independent Director of a “special purpose entity” affiliated with Borrower or permit the board of directors of any SPC Party and Borrower 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 or under any organizational document shall not be disqualified from serving as an Independent Director of Borrower or SPC Party, requires Party if such “special purpose entity” does not own a vote of the board of directors direct or managers of each SPC Party and Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) Borrower shall conduct its business so that the assumptions made with respect to Borrower indirect equity interest in the Insolvency Opinion shall be true and correct in all respects. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or in any other Person) co-borrower of Borrower and if such individual is an independent director provided by a nationally-recognized company that provides professional independent directors. For purposes of this paragraph, a “special purpose entity” is an entity, whose organizational documents contain restrictions on its activities substantially similar to those set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in Section 3.1.24 of this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC PartyAgreement.
(s) Borrower will not permit any Affiliate or constituent party access to its bank accounts except as required for the conduct of Borrower's business.
(t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.
Appears in 1 contract
Single Purpose. Borrower hereby represents and warrants to, and covenants with, Lender that as of the date hereof and until such time as the Debt shall be paid in full:
(a) Borrower does not own and will not own any asset or property other than (i) the Property, and (ii) incidental personal property necessary for the ownership or operation of the Property.
(b) Borrower has not conducted any business other than in connection with this Agreement and will not engage in any business other than the ownership, management and operation of the Property and Borrower will conduct and operate its business as presently contemplated to be conducted and operated.
(c) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an armsarm’s-length basis with third parties other than any such party.
(d) Borrower has not incurred and will not incur any Indebtedness other than (i) the Debt, (ii) unsecured trade payables and operational debt not evidenced by a note and note, (iii) Indebtedness incurred in the financing of equipment and other personal property used on the Property; Property provided that any Indebtedness incurred pursuant to subclauses (ii) and (iii) shall be (x) not in excess of Four Million and No/100 Dollars ($4,000,000.00) in the aggregate, (y) paid not more than sixty (60) days from the date incurred as to the matters in subclause (ii) above and not more than sixty (60) days from the date due and payable as to the matters in subclause (iii) above and above, (zy) incurred in the ordinary course of businessbusiness and (z) not in excess of $6,000,000 in the aggregate (which amount shall exclude the cost of any Capital Expenditures), and (iv) the obligations of Borrower pursuant to the Seller Sharing Agreement and the Tax Sharing Agreement and Borrower’s delivery to the City of Chicago of a $250,000 letter of credit required in connection with the assignment to Borrower of the Conduit Path Agreement. No Indebtedness other than the Debt may be secured (subordinate or pari passu) by the Property.
(e) Borrower has not made and will not make any loans or advances to any third party (including any Affiliate or constituent party), and shall not acquire obligations or securities of its Affiliates.
(f) Borrower is and will use commercially reasonable efforts to remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its assets as the same shall become due.
(g) 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 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 constituent party without the prior consent of Lender in any manner that (i) violates the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's ’s consent.
(h) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any constituent party. Borrower's ’s assets will not be listed as assets on the financial statement of any other Person, provided, however, that Borrower's ’s assets may be included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation shall be made on such consolidated financial statements to indicate the separateness of Borrower and such Affiliates and to indicate that Borrower's ’s assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person and (ii) such assets shall be listed on Borrower's ’s own separate balance sheet. Borrower will file its own tax returns (to the extent Borrower is required to file any such tax returns) and will not file a consolidated federal income tax return with any other PersonPerson unless, in each instance, Borrower is treated as a “disregarded entity” for tax purposes and is not required to file tax returns under applicable law. Borrower shall maintain its books, records, resolutions and agreements as official records.
(i) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of 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 as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks bearing its own name.
(j) Borrower will use commercially reasonable efforts to 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.
(k) Neither Borrower nor any constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower.
(l) Borrower will not commingle the funds and other assets of Borrower with those of any Affiliate or constituent party or any other Person, and will hold all of its assets in its own name.
(m) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or constituent party or any other Person.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out to be responsible for or make have its assets credit available to satisfy the debts or obligations of any other Person.
(i) If Borrower is a limited partnership or a limited liability company company, (other than a single member limited liability company), each general partner or managing member (each, an "“SPC Party"”) shall be a corporation 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 3.1.24 as if such representation, warranty or covenant was made directly by such SPC Party. Upon the withdrawal or the disassociation of an SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party whose articles of incorporation are substantially similar to those of such SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners.
(ii) If Borrower is a single member limited liability company, Borrower shall have at least two one springing membersmember (a corporation 100% owned by the sole member of Borrower), one of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member.
(p) Borrower shall at all times cause there to be at least two duly appointed members of the board of directors (or two special managers if Borrower is a limited liability company) who are provided by a nationally-recognized company that provides professional independent directors (each, an "Independent Director") Directors of each SPC Party and Borrower reasonably satisfactory to Lender who shall not have been at the time of such individual's appointment or at any time while serving as a director or manager of such SPC Party and Borrower, and may not have been at any time during the preceding five years (i) a stockholder, director (other than as an Independent Director), officer, employee, partner, attorney or counsel of such SPC Party, Borrower or any Affiliate of either of them, (ii) a customer, supplier or other Person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate of either of them, (iii) a Person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, or (iv) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower 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 the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special members. As used in this definition, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwiseLender.
(q) Borrower shall not cause or permit the board of directors of any SPC Party and Borrower 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 or under any organizational document of Borrower or SPC Party, requires a vote of the board of directors or managers of each SPC Party and Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) 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 material respects. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, in all material respects, (i) all of the facts and assumptions (whether regarding the Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC Party.
(s) Borrower will not permit any Affiliate or constituent party independent access to its bank accounts except as required for the conduct of Borrower's businessaccounts.
(t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.
Appears in 1 contract
Single Purpose. Borrower hereby represents ENTITY COVENANTS On and warrants to, and covenants with, Lender that as of the date hereof and until such time as the Debt shall be paid at all times while this Agreement or any Transaction hereunder is in full:
(a) Borrower does not own and will not own any asset or property other than effect, Seller covenants that: (i) the PropertySeller shall own no assets, and (ii) incidental personal property necessary for the ownership or operation of the Property.
(b) Borrower has not conducted any business other than in connection with this Agreement and will shall not engage in any business business, other than with respect to the Purchased Assets (including Eligible Assets which Seller intends to sell to Purchaser subject to a Transaction hereunder), those Purchased Assets which have been repurchased from Purchaser by Seller (provided that such Purchased Assets are transferred promptly to an entity other than Seller after such repurchase), and other assets incidental to the origination, acquisition, ownership, management financing and operation disposition of the Property and Borrower will conduct and operate its business as presently conducted and operated.
(c) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arms-length basis with third parties other than any such party.
(d) Borrower has not incurred and will not incur any Indebtedness other than (i) the Debt, Purchased Assets; (ii) unsecured trade payables and operational debt not evidenced by a note and (iii) Indebtedness incurred in the financing of equipment and other personal property used on the Property; provided that any Indebtedness incurred pursuant to subclauses (ii) and (iii) Seller shall be (x) not in excess of Four Million and No/100 Dollars ($4,000,000.00) in the aggregate, (y) paid not more than sixty (60) days from the date incurred as to the matters in subclause (ii) above and not more than sixty (60) days from the date due as to the matters in subclause (iii) above and (z) incurred in the ordinary course of business. No Indebtedness other than the Debt may be secured (subordinate or pari passu) by the Property.
(e) Borrower has not made and will not make any loans or advances to any Affiliate or third party (including any Affiliate or constituent party), and shall not acquire obligations or securities of its Affiliates.
Affiliates (fin each case, other than advances under the Purchased Assets (or Eligible Assets which Seller intends to sell to Purchaser subject to a Transaction hereunder) Borrower is and will remain solvent and Borrower will to Mortgagors or Mezzanine Borrowers or otherwise in connection therewith); (iii) Seller shall pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) only from its own assets as the same shall become due.
; (giv) Borrower has done or caused to be done and will Seller shall comply with the provisions of its organizational documents in all material respects; (v) Seller shall do all things necessary to observe its organizational formalities and to preserve its existence, and Borrower will not, nor will Borrower permit any 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 constituent party without the prior consent of Lender in any manner that ; (ivi) violates the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's consent.
(h) Borrower will Seller shall maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any constituent party. Borrower's assets will not (except that such financial statements may be listed consolidated to the extent consolidation is permitted or required under GAAP or as assets on the financial statement a matter of any other Person, Requirements of Law; provided, however, that Borrower's assets may be included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation shall be made on such consolidated financial statements to indicate the separateness of Borrower and Seller from such Affiliates Affiliate and to indicate that Borrower's Seller’s assets and credit are not available to satisfy the debts and other obligations of such Affiliates Affiliate or any other Person and (ii) such assets shall also be listed on Borrower's Seller’s own separate balance sheet. Borrower will ) and file its own tax returns returns, if any (except to the extent Borrower 54 consolidation is required to file any or permitted under Requirements of Law, such tax returnsas in the case of a disregarded entity); (vii) and will not file a consolidated federal income tax return with any other Person. Borrower Seller shall maintain its books, records, resolutions and agreements as official records.
(i) Borrower will be, and at all times will shall hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of BorrowerAffiliate), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, and shall not identify itself or any of its Affiliates as a division or part of the other and other; (viii) Seller shall maintain and utilize separate stationery, invoices and checks bearing its own name.
(j) 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.
operations and shall remain solvent; provided, that the foregoing shall not require any member, partner or shareholder of Seller to make any additional capital contributions to Seller; (kix) Neither Borrower nor any constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower.
(l) Borrower will Seller shall not commingle the its funds and or other assets of Borrower with those of any Affiliate or constituent party or any other Person, Person and will hold all of its assets in its own name.
(m) Borrower has and will shall maintain its properties and assets in such a manner that it will would not be costly or difficult to segregateidentify, segregate or ascertain or identify its individual properties and assets from those of any Affiliate or constituent party or any other Person.
others; (nx) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out to be responsible for or make its assets available to satisfy the debts or obligations of any other Person.
(i) If Borrower is a limited partnership or a limited liability company (other than a single member limited liability company), each general partner or managing member (each, an "SPC Party") shall be a corporation 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 3.1.24 as if such representation, warranty or covenant was made directly by such SPC Party. Upon the withdrawal or the disassociation of an SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party whose articles of incorporation are substantially similar to those of such SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners.
(ii) If Borrower is a single member limited liability company, Borrower shall have at least two springing members, one of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member.
(p) Borrower shall at all times cause there to be at least two duly appointed members of the board of directors (or two special managers if Borrower is a limited liability company) who are provided by a nationally-recognized company that provides professional independent directors (each, an "Independent Director") of each SPC Party and Borrower reasonably satisfactory to Lender who shall not have been at the time of such individual's appointment or at any time while serving as a director or manager of such SPC Party and Borrower, and may not have been at any time during the preceding five years (i) a stockholder, director (other than as an Independent Director), officer, employee, partner, attorney or counsel of such SPC Party, Borrower or any Affiliate of either of them, (ii) a customer, supplier or other Person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate of either of them, (iii) a Person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, or (iv) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower 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 the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special members. As used in this definition, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwise.
(q) Borrower shall not cause or permit the board of directors of any SPC Party and Borrower 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 or under any organizational document of Borrower or SPC Party, requires a vote of the board of directors or managers of each SPC Party and Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) 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. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC Party.
(s) Borrower will not permit any Affiliate or constituent party access to its bank accounts except as required for the conduct of Borrower's business.
(t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.Intentionally Omitted;
Appears in 1 contract
Sources: Master Repurchase Agreement
Single Purpose. Borrower hereby represents and warrants to, and -------------- covenants with, Lender that as of the date hereof and until such time as the Debt shall be paid in full:
(ai) Borrower does not own and will not own any asset or property other than (iA) the PropertyProperties, and (iiB) incidental personal property necessary for the ownership or operation of the PropertyProperties.
(bii) Borrower has not conducted any business other than in connection with this Agreement and will not engage in any business other than the ownership, management and operation of the Property Properties and Borrower will conduct and operate its business as presently conducted and operated.
(ciii) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an armsarm's-length basis with third parties other than any such party.
(div) 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 (iA) the Debt, ; (iiB) unsecured trade payables and operational debt other unsecured indebtedness not evidenced by a note, equipment leases and endorsements of checks, incurred by Borrower for or in respect of the operation of the Properties in the ordinary course of operating its business; (C) unsecured indebtedness not evidenced by a note payable or reimbursable to a tenant under a Lease on account of work performed or costs incurred by such tenant in connection with its occupancy of space at an Individual Property pursuant to the Lease, including costs for tenant improvement work; and (D) indebtedness relating solely to the financing of construction of capital improvements, tenant improvements or building equipment or leasing costs payable to third parties or the Manager in accordance with the Property Management Agreement and incurred with respect to one or more of the Individual Properties and costs associated with such indebtedness, either unsecured or secured only by subordinate liens and (i) which in the aggregate does not exceed an amount equal to five percent (5%) of the outstanding principal amount of the Loan at any time, (ii) the proceeds of which are not distributed to Borrower or any direct beneficial owner of an interest in Borrower, but are instead used to fund directly the costs of items described above, other than commissions and fees paid to Manager in accordance with the Management Agreement, (iii) Indebtedness incurred which is evidenced by a note or other written agreement having terms (other than the interest rate and repayment terms) no less favorable to Borrower than the terms of the Loan, (iv) the terms of which shall require that the principal amount of such indebtedness be repaid from Net Operating Income prior to any distributions to any direct beneficial owner of an interest in Borrower (other than for income, franchise, or other taxes imposed on Borrower for the privilege of doing business in the financing of equipment and other personal property used on jurisdictions in which the Property; provided that any Indebtedness incurred pursuant to subclauses (iiProperty is located) and (iiiv) shall be (x) not is subject to a subordination and standstill agreement satisfactory in excess of Four Million form and No/100 Dollars ($4,000,000.00) substance to Lender. Except as set forth in the aggregateimmediately preceding sentence, (y) paid not more than sixty (60) days from the date incurred as to the matters in subclause (ii) above and not more than sixty (60) days from the date due as to the matters in subclause (iii) above and (z) incurred in the ordinary course of business. No Indebtedness no indebtedness other than the Debt may be secured (subordinate or pari passu) by the Property.Properties. ---- -----
(ev) Borrower has not made and will not make any loans or advances to any third party (including any Affiliate affiliate or constituent party), and shall not acquire obligations or securities of its Affiliates.
(fvi) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel employment and overhead expenses) from its assets as the same shall become due, subject to Borrower's right to contest Taxes and Other Charges in accordance with Section ------- 5.1(b) and Labor and Material Costs in accordance with Section 3.6(b) of the ------ Mortgage.
(gvii) Borrower has done or caused to be done and will do all things necessary to observe organizational partnership formalities and preserve its existence, and Borrower will not, nor will Borrower permit any 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 constituent party without the prior written consent of Lender in any manner that (i) violates the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's consent.
(hviii) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates affiliates and any constituent party. Borrower's assets will not be listed as assets on the financial statement of any other Person, provided, however, that Borrower's assets may be included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation shall be made on such consolidated financial statements to indicate the separateness of Borrower party and such Affiliates and to indicate that Borrower's assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person and (ii) such assets shall be listed on Borrower's own separate balance sheet. Borrower will file its own tax returns (to the extent Borrower is required to file any such tax returns) and will not file a consolidated federal income tax return with any other Person. Borrower shall maintain its books, records, resolutions and agreements as official records.
(iix) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of 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 as a division or part unit of the other and shall maintain and utilize separate stationery, invoices and checks bearing checks; provided, however that Borrower may use the word "▇▇▇▇▇▇▇▇" as a part of Borrower's name, may describe itself as a "wholly-owned subsidiary" of ▇▇▇▇▇▇▇▇ Properties Acquisition Partners, L.P. so long as such description is true and correct and may permit its own namerelationship with its Affiliates to be disclosed in order to comply with any public filing requirements applicable to ▇▇▇▇▇▇▇▇ Properties Trust.
(jx) 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.
(kxi) Neither Borrower nor any constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower.
(lxii) Borrower will not commingle the funds and other assets of Borrower with those of any Affiliate or constituent party or any other Person. For purposes of this clause (xii), and will hold all funds distributed to partners of its assets in its own nameBorrower as permitted under this Agreement shall no longer constitute funds of Borrower.
(mxiii) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or constituent party or any other Person.
(nxiv) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out to be responsible for or make its assets available to satisfy the debts or obligations of any other Person.
(ixv) If Borrower is a limited partnership or a limited liability company (other than a single member limited liability company)partnership, each the general partner or managing member (each, an "SPC Party") shall be is a corporation whose sole asset is its interest in Borrower and each such SPC Party the general partner will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 3.1.24 ------- 4.1(ee) as if such representation, warranty or covenant was made directly by ------- such SPC Party. Upon the withdrawal or the disassociation of an SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party whose articles of incorporation are substantially similar to those of such SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity ownersgeneral partner.
(ii) If Borrower is a single member limited liability company, Borrower shall have at least two springing members, one of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member.
(pxvi) Borrower shall at all times cause there to be at least two one (1) duly appointed members member of the board of directors (or two special managers if Borrower is a limited liability company) who are provided by a nationally-recognized company that provides professional independent directors (each, an "Independent DirectorINDEPENDENT DIRECTOR") of each SPC Party and Borrower reasonably satisfactory to Lender who shall not have been at the time of such individual's appointment or at any time while serving as a director or manager of such SPC Party and Borrower, and may not have been at any time during the preceding five years (i) a stockholder, director (other than as an Independent Director), officer, employee, partner, attorney or counsel of such SPC Party, Borrower or any Affiliate of either of them, (ii) a customer, supplier or other Person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate of either of them, (iii) a Person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, or (iv) a member -------------------- of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower 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 the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special members. As used in this definition, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwise.
(q) Borrower shall not cause or permit the board of directors of any SPC Party and Borrower 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 or under any organizational document of Borrower or SPC Party, requires a vote of the board of directors or managers of each SPC Party and Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) 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. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC Party.
(s) Borrower will not permit any Affiliate or constituent party access to its bank accounts except as required for the conduct of Borrower's business.
(t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.general -52-
Appears in 1 contract
Single Purpose. (a) Borrower hereby represents and warrants to, and covenants withthat, Lender that once the date of Borrower’s formation and until the date hereof, Borrower has operated as a single purpose entity and has complied with all provisions of Borrower’s limited liability company operating agreement, including, without limitation, the special purpose provisions contained in Section 9(j) of such agreement.
(b) Borrower hereby represents and warrants, and covenants that, as of the date hereof and until such time as the Debt shall be paid in full, Borrower, Mortgage Borrower and First Mezzanine Borrower:
(ai) Borrower does do not own and will not own any asset or property other than (i) operation of its property or its ownership interests in Mortgage Borrower or First Mezzanine Borrower or the Property, and as applicable;
(ii) incidental personal property necessary for the ownership or operation of the Property.
(b) Borrower has do not conducted any business other than in connection with this Agreement and will not engage in any business other than the ownership, management and operation ownership of the Property Collateral, the First Mezzanine Collateral or the Property, as applicable, and Borrower will conduct and operate its business as presently proposed to be conducted and operated., subject to expanded operations and management in connection with the Condominium Documents;
(ciii) except for capital contributions and capital distributions permitted under the terms of this Agreement and properly reflected on the books of records of Borrower, First Mezzanine Borrower and/or Mortgage Borrower and, with respect to Mortgage Borrower, the Heritage Intercompany Loan, the Development Fee, and the Deferred -49- Development Fee, have not and will not enter into any contract or agreement with any Affiliate of BorrowerAffiliate, any constituent party of Borrower or any Affiliate of any constituent party, except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an armsarm’s-length basis with third parties other than any such party.;
(div) Borrower has have not incurred and will not incur any Indebtedness Indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation) other than (iA) the DebtLoan, with respect to Borrower, the First Mezzanine Loan, with respect to First Mezzanine Borrower, and the Mortgage Loan, with respect to Mortgage Borrower, (iiB) unsecured trade payables and operational debt not evidenced by a note with respect to Mortgage Borrower, the Heritage Intercompany Loan and (iiiC) Indebtedness liabilities incurred in the financing ordinary course of equipment and other personal property used on the Property; provided that any Indebtedness incurred pursuant Borrower’s business in amounts not to subclauses (ii) and (iii) shall be (x) not in excess of Four Million and No/100 Dollars ($4,000,000.00) exceed in the aggregateaggregate $2,000,000.00, (y) paid when combined with liabilities of Mortgage Borrower and Second Mezzanine Borrower incurred in the ordinary course of their respective businesses), which liabilities are not more than sixty (60) days from past the date incurred as to the matters in subclause (ii) above incurred, are not evidenced by a note and not more than sixty (60) days from the date due as to the matters in subclause (iii) above are paid when due; and (z) incurred in the ordinary course of business. No no Indebtedness other than the Debt may be secured (subordinate subordinate, pari passu or pari passuotherwise) by the Collateral, the First Mezzanine Collateral or the Property., as applicable;
(ev) Borrower has have not made and will not make any loans or advances to any third party (including any Affiliate or constituent party), and shall not acquire obligations or securities of its Affiliates.;
(fvi) Borrower is are and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its their respective assets as the same shall become due.;
(gvii) Borrower has have done or have caused to be done and will do all things necessary to observe organizational formalities and preserve its each of their existence, and Borrower will not, nor will Borrower permit any constituent party to to, amend, modify or otherwise change the partnership certificate, partnership agreement, articles of incorporation and bylaws, certificate of formation, operating agreement, trust agreement or other organizational documents of Borrower or such constituent party without the prior consent of Lender in any manner that (i) violates the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's consent.;
(hviii) Borrower will maintain all of its books, records, financial statements and bank accounts as official records, separate from those of its Affiliates and any constituent party. Borrower's assets party and will not permit its assets to be listed as assets on the financial statement of any other Person, entity; provided, however, that Borrower's ’s, Mortgage Borrower’s and First Mezzanine Borrower’s assets may be included in a consolidated financial statement of its Affiliates Affiliate provided that (ia) appropriate notation shall be made on such consolidated financial statements to indicate the separateness of the Borrower, Mortgage Borrower and and/or First Mezzanine Borrower from such Affiliates Affiliate and to indicate that Borrower's ’s, Mortgage Borrower’s and/or First Mezzanine Borrower’s assets and credit credit, as applicable, are not available to satisfy the debts and other obligations of such Affiliates Affiliate or any other Person and (iib) such assets shall also be listed on the Borrower's ’s, Mortgage Borrower’s and/or First Mezzanine Borrower’s own separate balance sheet. Borrower will file its own tax returns (to the extent Borrower is required to file any such tax returns) and will not file a consolidated federal income tax return with any other Person. Borrower shall maintain its books, records, resolutions and agreements as official records.;
(iix) Borrower will be, and at all times will hold itself themselves out to the public as, a legal entity entities separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of Borrowerparty), shall correct any known misunderstanding regarding its their status as a separate entityentities, shall conduct business in its their own name, shall not identify itself themselves or any of its their Affiliates as a division or part of the other and shall maintain and utilize a separate telephone number and separate stationery, invoices and checks bearing its their own name.;
(jx) Borrower will maintain adequate capital and a sufficient number of employees for the normal obligations reasonably foreseeable in a business of its their respective size and character and in light of its their respective contemplated business operations.;
(kxi) Neither Borrower will not seek or effect nor permit any constituent party will to seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower.any of them;
(lxii) Borrower will not commingle the their respective funds and other assets of Borrower with those of any Affiliate or constituent party or any other Person, and will hold all of its their respective assets in its own name.;
(mxiii) Borrower has and will maintain its their respective assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its their respective individual assets from those of any Affiliate or constituent party or any other Person.;
(nxiv) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself themselves out to be responsible for or make its assets have their respective credit available to satisfy the debts or obligations of any other Person;
(xv) will not permit any Affiliate or constituent party independent access to their respective bank accounts;
(xvi) if they respectively employ any employees of their own, will pay the salaries of any such employees from their own respective funds;
(xvii) will compensate each of their own consultants and agents from their funds for services provided to them and pay from their own assets all obligations of any kind incurred, including shared overhead expenses;
(xviii) will not pledge each of their assets to secure the obligations of any other Person;
(xix) will not form, acquire or hold any subsidiary (whether corporate, partnership, limited liability company or other) or own any equity interest in any other entity other than, with respect to Borrower, First Mezzanine Borrower or Mortgage Borrower;
(xx) will allocate fairly and reasonably any overhead expenses that are shared with any affiliate, including for shared office space and for services performed by any employee of an affiliate;
(xxi) will file their own respective tax returns, except to the extent Borrower, Mortgage Borrower or First Mezzanine Borrower is a “disregarded entity” for tax purposes;
(xxii) will cause the managers, agents and other representatives of the Borrower, First Mezzanine Borrower and/or Mortgage Borrower, as applicable to act at all times with respect to the First Mezzanine Borrower, Mortgage Borrower and/or Borrower, as applicable in furtherance of the foregoing and in the best interests of the Borrower, First Mezzanine Borrower and Mortgage Borrower; and
(xxiii) will not buy or hold evidence of indebtedness issued by any other Person (other than cash or investment-grade securities).
(i) If Borrower is a limited partnership or a limited liability company company, (other than a single member limited liability company), each general partner or managing member (each, an "“SPC Party"”) shall be a corporation 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 3.1.24 as if such representation, warranty or covenant was made directly by such SPC Party. Upon the withdrawal or the disassociation of an SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party whose articles of incorporation are substantially similar to those of such SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners.
(ii) If Borrower is a single member Delaware limited liability company, Borrower shall have at least two springing members, one each of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole a member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member.
(pd) Borrower shall at all times cause there to be at least two one (1) duly appointed members member of the board of directors (or two special independent managers if Borrower who is a limited liability company) who are provided by a nationally-nationally recognized company that provides professional independent directors (each, an "“Independent Director"”) and professional independent managers (each, an “Independent Manager”) of each Borrower or any such SPC Party and Borrower reasonably satisfactory to Lender who shall not have been at the time of such individual's ’s appointment or at any time while serving as a director or manager of such SPC Party and or Borrower, and may not have been at any time during the preceding five (5) years (i) a stockholder, director (other than as an Independent Director), officer, member, trustee, employee, partner, attorney or counsel of such SPC Party, Borrower or any Affiliate of either of them, (ii) a creditor, customer, supplier or other Person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate of either of them, (iii) a Person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, or (iv) a member of the immediate family by blood or marriage of any such stockholder, director, officer, member, trustee, employee, partner, creditor, customer, supplier or -52- other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower 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 the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special members. As used in this definition, the term "“control" ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwise.
(qe) Borrower shall not cause or permit the board of directors of any SPC Party and Borrower 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 or under any organizational document of Borrower or SPC Party, requires a vote of the board of directors or managers of each SPC Party and Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) 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. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC Party.
(s) Borrower will not permit any Affiliate or constituent party access to its bank accounts except as required for the conduct of Borrower's business.
(t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.
Appears in 1 contract
Sources: Second Mezzanine Loan Agreement
Single Purpose. Borrower hereby represents and warrants to, and covenants with, Lender that as of the date hereof and until such time as the Debt shall be paid in full:
(a) Borrower does not own and will not own any asset or property other than (i) the Property, and (ii) incidental personal property necessary for the ownership or operation of the Property.
(b) Borrower has not conducted any business other than in connection with this Agreement and will not engage in any business other than the ownership, development, repair, maintenance, management and operation of the Property and Borrower will conduct and operate its business as presently conducted and operated.
(c) Borrower will not enter into any contract or agreement with any Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any constituent party, 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 other than any such party.
(d) Borrower has not incurred and will not incur any Indebtedness other than (i) the Debt, (ii) unsecured trade payables and operational debt not evidenced by a note and in an aggregate amount not exceeding $500,000 at any one time and (iii) Indebtedness incurred in the financing of equipment and other personal property used on the PropertyProperty with annual payments not exceeding $500,000 in the aggregate; provided that any Indebtedness incurred pursuant to subclauses (ii) and (iii) shall be (x) not in excess of Four Million be outstanding more than thirty (30) days past the due date thereof and No/100 Dollars ($4,000,000.00) in the aggregate, (y) paid not more than sixty (60) days from the date incurred as to the matters in subclause (ii) above and not more than sixty (60) days from the date due as to the matters in subclause (iii) above and (z) be incurred in the ordinary course of business. No Indebtedness other than the Debt may be secured (subordinate or pari passu) by the Property.
(e) Borrower has not made and will not make any loans or advances to any third party (including any Affiliate or constituent party), and shall not acquire obligations or securities of its Affiliates.
(f) Borrower is and will remain solvent and Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its assets as the same shall become due.
(g) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities applicable to Borrower and preserve its existence, and Borrower will not, nor will Borrower permit any 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 constituent party without the prior consent of Lender in any manner that (i) violates the single purpose covenants set forth in this Section 3.1.24, or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be modified at any time when the Loan is outstanding or by its terms cannot be modified without Lender's consent.
(h) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates and any constituent partyother person or entity. Borrower's assets will not be listed as assets on the financial statement of any other Person, provided, however, that Borrower's assets may be included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation shall be made on such consolidated financial statements to indicate the separateness of Borrower and such Affiliates and to indicate that Borrower's assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person and (ii) such assets shall be listed on Borrower's own separate balance sheet. Borrower will file its own tax returns (to the extent Borrower is required to file any such tax returns) and will not file a consolidated federal income tax return with any other Person. Borrower shall maintain its books, records, resolutions and agreements as official records.
(i) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate of Borrower or any constituent party of 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 as a division or part of the other and shall maintain and utilize separate stationery, invoices and checks bearing its own name.
(j) 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.
(k) Neither Borrower nor any constituent party will seek or effect the liquidation, dissolution, winding up, liquidation, consolidation or merger, in whole or in part, of Borrower.
(l) Borrower will not commingle the funds and other assets of Borrower with those of any Affiliate or constituent party or any other Person, and will hold all of its assets in its own name.
(m) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or constituent party or any other Person.
(n) Borrower will not guarantee or become obligated for the debts of any other Person and does not and will not hold itself out to be responsible for or make have its assets credit available to satisfy the debts or obligations of any other Person.
(i) If Borrower is a limited partnership or a limited liability company (other than a single member limited liability company), each general partner or managing member (each, an "SPC Party") shall be a corporation 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 3.1.24 as if such representation, warranty or covenant was made directly by such SPC Party. Upon the withdrawal or the disassociation of an SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party whose articles of incorporation are substantially similar to those of such SPC Party and deliver a new non-consolidation opinion to the Rating Agency or Rating Agencies, as applicable, with respect to the new SPC Party and its equity owners.
(ii) If Borrower is a single member limited liability company, Borrower shall have at least two springing members, one of which, upon the dissolution of such sole member or the withdrawal or the disassociation of the sole member from Borrower, shall immediately become the sole member of Borrower, and the other of which shall become the sole member of Borrower if the first such springing member no longer is available to serve as such sole member.
(p) Borrower shall at all times cause there to be at least two duly appointed members of the board of directors (or two special managers if Borrower is a limited liability company) who are provided by a nationally-recognized company that provides professional independent directors (each, an "Independent Director") of each SPC Party and Borrower reasonably satisfactory to Lender who shall not have been at the time of such individual's appointment or at any time while serving as a director or manager of such SPC Party and Borrower, and may not have been at any time during the preceding five years (i) a stockholder, director (other than as an Independent Director), officer, employee, partner, attorney or counsel of such SPC Party, Borrower or any Affiliate of either of them, (ii) a customer, supplier or other Person who derives any of its purchases or revenues from its activities with such SPC Party, Borrower or any Affiliate of either of them, (iii) a Person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other Person, or (iv) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other Person. A natural person who otherwise satisfies the foregoing definition of Independent Director except for being the independent director, manager or special member of a "special purpose entity" affiliated with the Borrower that does not own a direct or indirect equity interest in the Borrower 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 the Borrower (other than any entity that owns a direct or indirect equity interest in the Borrower) if such individual is an independent manager, director or special member provided by a nationally-recognized company that provides professional independent managers, directors or special members. As used in this definition, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwise.
(q) Borrower shall not cause or permit the board of directors of any SPC Party and Borrower 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 or under any organizational document of Borrower or SPC Party, requires a vote of the board of directors or managers of each SPC Party and Borrower unless at the time of such action there shall be at least two board members or managers who are each an Independent Director.
(r) 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. In connection with the foregoing, Borrower hereby covenants and agrees that it will comply with or cause the compliance with, (i) all of the facts and assumptions (whether regarding the Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all the representations, warranties and covenants in this Section 3.1.24, and (iii) all the organizational documents of the Borrower and any SPC Party.
(s) Borrower will not permit any Affiliate or constituent party access to its bank accounts except as required for the conduct of Borrower's business.
(t) Borrower shall pay the salaries of its own employees (if any) from its own funds and maintain a sufficient number of employees (if any) in light of its contemplated business operations.
(u) Borrower shall compensate each of its consultants and agents from its funds for services provided to it and pay from its own assets all obligations of any kind incurred.
Appears in 1 contract
Sources: Loan Agreement (Corporate Property Associates 16 Global Inc)