Transfers. (a) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect interest therein, or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers. (b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied: (i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default; (ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies; (iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; (iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies; (v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents; (vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and (vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan; (viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and (ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance. (c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied: (i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower; (ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies; (iii) at the time of such Transfer no Event of Default has occurred and is continuing; (iv) following such Transfer the property manager of the Property must be a Qualified Manager; (v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities (vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and (vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.
Appears in 3 contracts
Sources: Loan Agreement (Innkeepers Usa Trust/Fl), Loan Agreement (Innkeepers Usa Trust/Fl), Loan Agreement (Innkeepers Usa Trust/Fl)
Transfers. (a) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof, Borrower Stockholder shall not, and shall not permit (i) directly or indirectly offer, sell (including short sales), transfer, tender, assign, exchange, pledge, encumber or otherwise dispose of (including by gift, merger or operation of law) (collectively, “Transfer”), or enter into any Person owning contract, option, derivative, hedging, swap, forward or other agreement, understanding or other arrangement (including any profit sharing arrangement) with respect to a direct or indirect interest in Borrower or Operating Lessee to do Transfer of, any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect toCompany Shares, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect interest therein, or to any Person, (ii) permit a Sale enter into any voting arrangement, whether by proxy, voting agreement or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assignsotherwise, with respect to any of the Transferee and its applicable affiliatesSubject Shares, which Additional Insolvency Opinion shall be reasonably acceptable (iii) grant any proxies or powers of attorney with respect to Lender orany or all of the Subject Shares, after a Securitization, (iv) agree to divest itself of any voting rights in the Rating Agencies;
Subject Shares or (v) the Transferee shall execute an assumption, effective as commit or agree to take any of the date foregoing actions. Stockholder agrees that any Transfer of transferSubject Shares not permitted hereby shall be null and void ab initio and that any such prohibited Transfer may and should be enjoined. If any involuntary Transfer of any of the Company Shares shall occur (including, but not limited to, a sale by Stockholder’s trustee in any bankruptcy, or a sale to a purchaser at any creditor’s or court sale), the transferee (which term, as used herein, shall include any and all transferees and subsequent transferees of the initial transferee) shall take and hold such Company Shares subject to all of the obligations of the Borrower thereafter arising or to be performed restrictions, liabilities and rights under this Agreement, which shall continue in full force and effect for the Mortgage and Term. The Company agrees that if Stockholder attempts to Transfer, vote or provide any other Person with the other Loan Documents, subject, however, authority to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager vote any of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests Company Shares other than in Borrower and control Borrowerstrict compliance with this Agreement, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent Company shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(iix) if as a result of permit any such Transfer on the Company’s books and records, (y) issue a new certificate or series of Transfers more than 49% instrument representing any of the direct Company Shares or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to permit any book entries for any such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer any Company Shares that are in uncertificated form or sale(z) record such vote, which Additional Insolvency Opinion shall be reasonably acceptable to Lender andin each case, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred unless and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies until Stockholder shall have confirmed that such Transfer, in and complied with the terms of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanthis Agreement.
Appears in 3 contracts
Sources: Investment and Transaction Agreement (Id Systems Inc), Voting and Support Agreement (Id Systems Inc), Voting and Support Agreement (Emancipation Management LLC)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, Key Principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership and control of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest thereintherein or any interest of Borrower in the Loan (including any of its rights, duties and obligations under this Agreement and the other Loan Documents) or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale enter into any plan of division, or conveyance occurs prior divide, establish a protected series, create a new registered series, or convert to a Securitization, Lender shall have consented to such sale another form of incorporated or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and unincorporated business or other entity or provide in its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as operating agreement for any of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays foregoing without Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance's prior written consent.
(c) A Transfer shall include (but not i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions are satisfied:creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(id) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverNotwithstanding the provisions of this Section 5.2.10, Lender’s consent shall not be required ifin connection with one or a series of Transfers, after giving effect of not more than ten percent (10%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such Transfer shall result in the Change of Control in a Restricted Party or cause any Key Principal to the no longer be a Key Principal of Borrower, and as a condition to each such Transfer, Sponsor owns Lender shall receive not less than 51% thirty (30) days prior written notice of such proposed Transfer. Borrower shall pay any and all reasonable out-of-pocket costs and expenses incurred in connection with such Transfers (including Lender’s counsel fees and disbursements and any fees and expenses of the equity interests in Rating Agencies).
(e) Without limiting Lender’s discretion to approve or disapprove any request for a waiver of the prohibition against Transfers, Lender specifically reserves the right to condition its consent to any waiver of a prohibited Transfer upon satisfaction of the following minimum conditions:
(i) Borrower and controls, directly or indirectly, Borrowershall pay Lender a transfer fee equal to one percent (1%) of the outstanding principal balance of the Loan at the time of such transfer;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together pay any and all reasonable out-of-pocket costs incurred in connection with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Transfer, including Lender)’s counsel fees and disbursements and all recording fees, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies title insurance premiums and their respective counsel, successors mortgage and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agenciesintangible taxes;
(iii) at The proposed transferee (the time “Transferee”) or Transferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Property, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such Transfer transfer, have an aggregate net worth and liquidity acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.31, 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Default or Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements, covenants and legal opinions reasonably required by Lender;
(x) Prior to any release of Guarantor, one (1) or more substitute guarantors acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or execute a replacement guaranty and environmental indemnity reasonably satisfactory to Lender.
(xi) Borrower shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policy, as modified by the assumption agreement, as a valid first lien on the Property and naming the Transferee as owner of the Property, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Property shall not be subject to any additional exceptions or liens other than those contained in the Title Insurance Policy issued on the date hereof and the Permitted Encumbrances;
(xii) If applicable, the Property shall be managed by Qualified Manager pursuant to a Replacement Management Agreement; and
(xiii) The Property meets all of the Lender’s underwriting standards related to its financial condition, cash flow, operating income, physical condition, management and operation.
(f) Notwithstanding any provision in this Section 5.2.10 to the contrary, limited partnership or membership interests, as applicable, in Borrower may be transferred without Lender’s consent and without application of the fee set forth in Section 5.2.10(e)(i): (i) among limited partners or members, as applicable, of Borrower who are limited partners or members, as applicable, of Borrower as of the date of this Agreement (each a “Current Owner”), and (ii) to immediate family members (which shall be limited to a spouse, parent, child and grandchild (each, an “Immediate Family Member”)), of any Current Owner or to trusts formed for the benefit of Immediate Family Members of such Current Owner for bona fide estate planning purposes (each, an “Additional Permitted Transfer”), provided each of the following conditions is satisfied: (A) no Default or Event of Default has occurred and is continuing;
; (ivB) following Lender has received Borrower’s notice of the Additional Permitted Transfer no less than 30 days prior to the commencement of such transfer; (C) no indemnitor or Guarantor shall be released from any guaranty or indemnity agreement by virtue of the Additional Permitted Transfer; (D) Borrower shall be responsible for the costs and expenses of documenting the Additional Permitted Transfer; (E) Borrower shall reimburse Lender for all actual costs and expenses incurred by Lender in connection with the Additional Permitted Transfer, whether or not consummated; (F) once the Additional Permitted Transfer is complete, the property manager persons with Control of Borrower and management of the Property must be a Qualified Manager;
(v) if, after giving effect to are the same persons who have such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower Control and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned management rights immediately prior to the Securities
Additional Permitted Transfer; (viG) Borrower shall pay, or cause to be paid, to furnish Lender its reasonable out-of-pocket expenses (including copies of any fees due to the Rating Agencies) documentation executed in connection with such sale or conveyancethe Additional Permitted Transfer promptly after execution thereof; and
and (viiH) in connection with any Transfer as a result of which Sponsor will not own at least 51% of Borrower shall have delivered satisfactory evidence to Lender that, following the equity interests in Borrower and control, directly or indirectly, BorrowerAdditional Permitted Transfer, Borrower shall give or cause continue to be given written notice to Lender comply with the provisions of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Section 4.1.31 hereof. Lender shall have not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany previous Transfer.
Appears in 3 contracts
Sources: Commercial Loan Agreement (Red Oak Capital Fund IV, LLC), Commercial Loan Agreement (Red Oak Capital Fund IV, LLC), Commercial Loan Agreement (Red Oak Capital Fund IV, LLC)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, Key Principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership and control of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest thereintherein or any interest of Borrower in the Loan (including any of its rights, duties and obligations under this Agreement and the other Loan Documents) or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale enter into any plan of division, or conveyance occurs prior divide, establish a protected series, create a new registered series, or convert to a Securitization, Lender shall have consented to such sale another form of incorporated or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and unincorporated business or other entity or provide in its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as operating agreement for any of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays foregoing without Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance's prior written consent.
(c) A Transfer shall include (but not i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectlyin, Borrower;
(ii) if as a result of ’s right, title and interest in and to any such Transfer Leases or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
any Rents; (iii) at the time if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such Transfer no Event corporation’s stock or the creation or issuance of Default has occurred and is continuing;
new stock; (iv) following such Transfer if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the property manager change, removal, resignation or addition of a general partner or the Sale or Pledge of the Property must be a Qualified Manager;
partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) ifif a Restricted Party is a limited liability company, after giving effect any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such Transfermembership interest, Sponsor does not own at least 51% or the Sale or Pledge of non-managing membership interests or the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and creation or issuance of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
new non managing membership interests; (vi) Borrower shall payif a Restricted Party is a trust or nominee trust, any merger, consolidation or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) Sale or Pledge of the legal or beneficial interest in connection with such sale a Restricted Party or conveyancethe creation or issuance of new legal or beneficial interests; and
or (vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% the removal or the resignation of the equity interests managing agent (including an Affiliated Manager) other than in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanaccordance with Section 5.1.22 hereof.
Appears in 3 contracts
Sources: Commercial Loan Agreement (Red Oak Capital Fund V, LLC), Commercial Loan Agreement (Red Oak Capital Fund V, LLC), Commercial Loan Agreement (Red Oak Capital Fund V, LLC)
Transfers. (a) Without Unless such action is permitted by the prior written consent provisions of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.13, Borrower shall notagrees that it will not (i) sell, and shall not assign, convey, transfer or otherwise dispose of its interests in the Property or any part thereof, (ii) permit any Person owning a direct owner, directly or indirect indirectly, of an ownership interest in the Property, to transfer such interest, whether by transfer of stock or other interest in Borrower or Operating Lessee any entity, or otherwise, (iii) incur Indebtedness (other than the Indebtedness permitted pursuant to the terms of this Agreement), (iv) mortgage, hypothecate or otherwise encumber or grant a security interest in the Property or any part thereof, (v) sell, assign, convey, transfer, mortgage, encumber, grant a security interest in, or otherwise dispose of any direct or indirect ownership interest in Borrower, or permit any owner of an interest in Borrower to do the same, or (vi) file a declaration of condominium with respect to the Property (any of the following (collectivelyforegoing transactions, a “Transfer”): ). For purposes hereof, a “Transfer” shall not include (iA) sellany issuance, conveysale or transfer of interests in Sole Member or any successor entity resulting from any merger permitted hereunder, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, (B) a transfer by devise or otherwise transfer descent or dispose of (voluntarily or involuntarily, by operation of law upon the death of a member or otherwise, and whether or not for consideration or partner of record) the Property or any direct or indirect interest thereinBorrower, or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreementsmerger of the Sole Member with any of the following entities: Inland Retail Real Estate Trust, Inc., a Maryland corporation, Inland Real Estate Corporation, a Maryland corporation, Inland Real Estate Investment Corporation, a Delaware corporation, Inland Western Retail Real Estate Trust, Inc., a Maryland corporation, any other real estate investment trust sponsored by Inland Real Estate Investment Corporation, or any other entity composed entirely of any of the foregoing by merger; provided, however, Lender shall receive not less than thirty (30) days prior written notice of such proposed transfer and, in connection with a merger hereinabove described, the net worth of the entity surviving the merger shall not be less than the net worth of the Sole Member immediately prior to such merger and (D) Permitted Transfersthe entity surviving the merger shall be publicly traded.
(ba) Notwithstanding On and after the foregoingClosing Date, Lender shall not withhold its consent to a sale or conveyance by Borrower Transfer of the Property subject to the lien Property, as part of the Mortgage (but not any other mortgagea single transaction, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i1) the transferee of the Property shall be a Special Purpose Entity (the “Transferee”) which at the time of such transfer will be in compliance with the covenants contained in Section 5.1.1 and the representations contained in 4.1.30 hereof and which shall have assumed in writing (subject to the terms of Section 9.4 hereof) and agreed to comply with all the terms, covenants and conditions set forth in this Loan Agreement and the other Loan Documents, expressly including the covenants contained in Section 5.1.1 and the representations contained in 4.1.30 hereof;
(2) if requested by Lender, Borrower shall deliver confirmation in writing from the Rating Agencies that such proposed Transfer will not cause a downgrading, withdrawal or qualification of the then current rating of any securities issued pursuant to such Securitization;
(3) if Manager does not act as manager of the transferred Property then the manager of the Property must be a Qualifying Manager;
(4) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Defaultcontinuing;
(ii5) the Person to whom the Property is sold if required or conveyed (the “Transferee”) satisfies the requirements requested by any of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender Borrower shall have consented caused counsel to such sale or conveyance, render a substantive non-consolidation opinion which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which in each case may be relied upon by Lenderthe holder of the Note, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Ratings Agencies and their respective counsel, successors agents and assigns, representatives with respect to the proposed transfer or saletransaction, including the Transferee, which Additional Insolvency Opinion opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agenciesin its reasonable discretion;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi6) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and have paid (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan an assumption fee of 1% equal to one percent (1.0%) of the then outstanding principal amount balance of the Loan., and (B) the reasonable and customary third-party expenses (including reasonable attorneys’ fees and disbursements) actually incurred by Lender in connection with such Transfer; provided, however,
(A) no assumption fee shall be required for a Transfer of the Property to a Transferee acceptable to Lender in connection with a joint venture between Sole Member and an entity acceptable to Lender, provided Sole Member or an Affiliate wholly-owned (directly or indirectly) by Sole Member owns at least ten percent (10%) of the ownership interests in such Transferee and for which Sole Member or an Affiliate wholly owned (directly or indirectly) by Sole Member, is the managing entity and otherwise maintains operational and managerial control of such Transferee, and Inland American Real Estate Trust, Inc. remains as Indemnitor, provided that, Borrower shall pay all of Lender’s reasonable and customary third-party expenses (including reasonable attorneys’ fees and
Appears in 3 contracts
Sources: Loan Agreement (Inland American Real Estate Trust, Inc.), Loan Agreement (Inland American Real Estate Trust, Inc.), Loan Agreement (Inland American Real Estate Trust, Inc.)
Transfers. (ai) Without the prior written consent of LenderEach Issuer acknowledges that Initial Noteholder has examined and relied, and except each Noteholder will rely, on the experience of Issuers and their respective general partners, members, principals and (if Issuer is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to purchase the Notes, and will continue to rely on Issuers’ ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the obligations contained in the Financing Documents. Each Issuer acknowledges that Trustee has a valid interest in maintaining the value of the Property so as to ensure that, should Issuers default in the repayment of the Debt or the performance of the obligations contained in the Financing Documents, Trustee can recover the Debt by a sale of the Property.
(ii) Except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof7.02(j), Borrower no Issuer shall, nor shall not, and shall not any Issuer permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party (collectively, a “Transfer”), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.7.01
Appears in 2 contracts
Sources: Note Indenture (Kerzner International LTD), Note Indenture (Kerzner International LTD)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to amend and restate this Agreement, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.11, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any part thereof or any direct legal or indirect direct beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee▇▇▇▇▇▇’▇ Manager held by HOC on the Closing Date, or any indirect interest (an “Intermediate Interest”) in Borrower or ▇▇▇▇▇▇’▇ Manager created by conveying direct interests held by HOC on the Closing Date to an intermediate subsidiary of HOC (collectively, a “Transfer”), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20. For the purposes of this Section 5.2.10, any removal from the Property of memorabilia or other personal property provided to Borrower for use or display at the Property pursuant to the terms of the PH License (Cother than any replacement of the same in accordance with the terms hereof) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, shall be deemed to constitute a sale or conveyance by Borrower Transfer of a part of the Property subject and shall require the prior written consent of Lender in its reasonable discretion in each instance. Borrower acknowledges that Lender may impose conditions to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements its approval of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender andTransfer, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assignsincluding, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as Transfer of the date of transfer, of all of Property in connection with which the transferee assumes the obligations of Borrower under the Borrower thereafter arising or to be performed under this Agreement, the Mortgage Loan and the other Loan Documents, subject, however, to the provisions payment of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan an assumption fee of 1% one quarter of one percent (0.25%) of the then outstanding principal amount balance of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions are satisfied:creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.23.
(id) if such sale Notwithstanding the foregoing provisions of this Section 5.2.10 or conveyance occurs prior anything else to a Securitizationthe contrary contained in this Agreement or any other Loan Document, Lender shall have consented but subject to such sale the satisfaction of all conditions set forth or conveyance, which consent shall not be unreasonably withheld; provided howeverreferenced in this Section 5.2.10(d), Lender’s consent shall not be required ifin connection with any of the following Transfers (each, a “Permitted Transfer”):
(i) the Transfer, in one or a series of transactions, of not more than 49% in the aggregate of the direct or indirect interests in Borrower or ▇▇▇▇▇▇’▇ Manager; provided that after giving effect to the Transfersuch Transfer and any other Transfers, Sponsor owns not less than 51% no Change of the equity interests in Borrower and controls, directly or indirectly, BorrowerControl shall occur;
(ii) the Transfer, in one or a series of transactions, of any direct or indirect interests in any Restricted Party to any other Restricted Party, any Affiliate of a Restricted Party or to any direct or indirect member or partner of any Restricted Party provided that after giving effect to such Transfer and any other Transfers, no Change of Control shall occur;
(iii) any Transfer by maintenance, devise or bequest or by operation of law upon the death of a natural person that was the holder of any direct or indirect interest in any Restricted Party to a member of the immediate family of such person or a trust established for the benefit of such immediate family member, provided that after giving effect to such Transfer and any other Transfers, no Change of Control shall occur;
(iv) the Transfer, in one or a series of transactions, of any direct or indirect interests in Guarantor or, subject to the provisions of subsection (e) below, in HOC;
(v) any arm’s-length sale of Personal Property by Borrower to a third party in the ordinary course of business and any disposition of Equipment and FF&E which is being replaced in the ordinary course of business or is otherwise no longer necessary or is immaterial; and
(vi) Permitted Encumbrances. Notwithstanding the foregoing, each of the Permitted Transfers set forth in this Section 5.2.10(d) shall be subject to, and Lender’s agreement to permit the same without specific consent, shall be conditioned upon the satisfaction of the following conditions:
(A) if such Transfer (either individually or in the aggregate with any prior Transfers) would result in a Change in Control of Borrower or ▇▇▇▇▇▇’▇ Manager, Lender shall receive not less than ten (10) Business Days prior written notice from Borrower of such Transfer;
(B) if such Transfer is of a direct interest or Intermediate Interest in Borrower or ▇▇▇▇▇▇’▇ Manager, Lender shall receive not less than ten (10) Business Days prior written notice from Borrower of such Transfer;
(C) if such Transfer (either individually or in the aggregate with any prior Transfers) would result in Sponsor or HOC no longer holding any direct or indirect interest in Borrower or ▇▇▇▇▇▇’▇ Manager, Lender shall receive not less than ten (10) Business Days prior written notice from Borrower of such Transfer;
(D) if neither of the circumstances set forth in clauses (A), (B) or (C) shall apply with respect to such Transfer, Lender shall receive written notice of such Transfer from Borrower within ten (10) Business Days following the effective date of such Transfer; provided that, no such notice shall be required with respect to any Transfer of a direct or indirect interest in Guarantor or HOC;
(E) if after giving effect to any Permitted Transfer, more than forty-nine percent (49%) in the aggregate of the direct interests or Intermediate Interests in Borrower or ▇▇▇▇▇▇’▇ Manager are owned by a Person and its Affiliates that owned less than forty-nine percent (49%) of the direct interests or Intermediate Interests in Borrower or ▇▇▇▇▇▇’▇ Manager, as applicable, as of the Closing Date, a result Rating Agency Confirmation shall have been obtained and, no less than thirty (30) days prior to the effective date of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Transfer, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, and the Rating Agencies;
(iiiF) at no Permitted Transfer (either individually or in the time aggregate with any prior Transfers) shall cause or otherwise result in the termination, revocation and/or suspension of such Transfer no Event any Gaming License or otherwise have any material and adverse effect on the ability of Default has occurred and is continuingManager or Borrower to operate the Casino Component in accordance with all applicable Gaming Laws;
(ivG) following no such Permitted Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests direct interest in Borrower and control Borrower, the Rating Agencies shall have confirmed or ▇▇▇▇▇▇’▇ Manager that such Transfer, in and of itself, will not result results in a downgrade, qualification Change of Control of Borrower or withdrawal of the then current ratings assigned ▇▇▇▇▇▇’▇ Manager shall be to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyanceDisqualified Transferee; and
(viiH) in connection with any no such Permitted Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and controlshall result, directly or indirectly, Borrowereither individually or in the aggregate, in any Disqualified Transferee being in Control of Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the ▇▇▇▇▇▇’▇ Manager or having a direct interest in Borrower is or ▇▇▇▇▇▇’▇ Manager.
(e) Notwithstanding anything to the contrary contained in this Section 5.2.10 or elsewhere in the Loan Documents, no transfer or conveyance, directly or indirectly, by Guarantor of interests in HOC that results in Guarantor (i) no longer Controlling HOC or (ii) owning less than 49% of the direct or indirect interests in HOC shall be transferred, identify permitted without the proposed transferee and set forth the date the Transfer is expected to be effective and prior consent of Lender unless (A) Lender shall have consented to such Transfer the obligations of Guarantor under the Guaranty are simultaneously by a guarantor that satisfies the “Net Worth” and “Liquid Assets” requirements set forth in Section 4.7 of the Guaranty and (B) Borrower the Property shall pay continue to Lender be managed by a loan assumption fee of 1% of the then outstanding principal amount of the LoanQualified Manager as required hereunder.
Appears in 2 contracts
Sources: Loan Agreement (Caesars Acquisition Co), Loan Agreement (Harrahs Entertainment Inc)
Transfers. Notwithstanding any other provision of this Agreement or any other Sponsor Document, subject to the provisions of the Series Certificate Agreement regarding (i) the delivery of an investor letter and (ii) the requirement that any transfer of a beneficial ownership interest in the Class B Certificates shall be made only in accordance with or subject to an exemption from, the Securities Act of 1933, as amended, the Sponsor and any transferee thereof shall be permitted to transfer any portion of its beneficial ownership interest in Class B Certificates (provided the Sponsor shall at all times maintain the Minimum Sponsor Interest). Any beneficial ownership interest in a Class B Certificate transferred, and all proceeds thereof, shall nonetheless remain Pledged Security Collateral subject to the security interest created by this Agreement, and each transferee shall be deemed to have agreed to each and every provision of this Agreement, including without limitation (a) Without the prior written consent of Lender, assignment and except pledge to the extent otherwise Pledge Custodian and grant to the Pledge Custodian, for the benefit of F▇▇▇▇▇▇ Mac, of a continuing security interest in and a lien on, all of its right, title and interest in and to the Class B Certificates acquired and all proceeds thereof, pursuant to Section 8.1 and (b) the appointment and powers of the Pledge Custodian as collateral agent for F▇▇▇▇▇▇ Mac as set forth in this Section 5.2.10 and Section 2.5 hereofArticle VIII. In addition, Borrower the Pledge Custodian shall nothave no duty to ascertain the identity of any transferee of a beneficial ownership interest in the Class B Certificates, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options make all payments with respect to, to any Class B Certificate that is permitted to be paid to the Sponsor only to the Sponsor or otherwise transfer or dispose of (voluntarily or involuntarily, a single entity designated by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect interest therein, or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Sponsor in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion written instructions thereof. The Pledge Custodian shall be reasonably acceptable permitted to Lender or, after a Securitization, rely on and assume the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result accuracy of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loaninstructions.
Appears in 2 contracts
Sources: Bond Exchange, Reimbursement, Pledge and Security Agreement (America First Multifamily Investors, L.P.), Bond Exchange, Reimbursement, Pledge and Security Agreement (America First Tax Exempt Investors Lp)
Transfers. (a) Without Borrower shall not, without the prior written consent of Lender, and suffer or permit the sale, assignment or transfer (collectively, "Transfer") of (i) all or any part of the Property (except pursuant to the extent otherwise set forth any Lease) other than in this Section 5.2.10 and Section 2.5 hereofconnection with a Special Transfer, (ii) any direct interest in Borrower shall not, and shall not permit or (iii) any Person owning a direct or indirect interest in any member of Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect interest therein, or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Leaseissuance or transfer of beneficial interests in Prime Group Realty Trust, a Maryland real estate investment trust, so long as such issuance or transfer does not result in a change in Control of Prime Group Realty Trust and so long as such issuance or transfer does not affect the non-consolidation opinion delivered by Borrower, and (B) pursuant to Leases the issuance or transfer of space limited partner interests in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoingPrime Group Realty L.P., a sale Delaware limited partnership, or conveyance a conversion of a one percent general partnership interest owned beneficially by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgageThe Nardi Group, lien L.L.C. in Prime Group Realty L.P. into a limited part▇▇▇▇▇ip interest in Prime Group Realty L.P., so long as such issuance or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall transfer does not result in an Event a change in Control of Default;
Prime Group Realty L.P. and so long as such issuance or transfer does not affect the non-consolidation opinion delivered by Borrower; provided, however, that Borrower may grant the easements and other rights in the Property specifically permitted under Section 8(f) of the Mortgage. No Transfer consented to by Lender pursuant to clause (ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, above shall be permitted unless Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
received (iva) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, evidence in writing from the applicable Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, a Transfer will not result in a downgradequalification, qualification withdrawal or withdrawal downgrading of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer for the Securities issued in connection with the Securitization which are then outstanding and (b) a non-consolidation opinion satisfactory to Lender from the transferee's counsel. On or as reflected before the completion of any such permitted Transfer, Borrower will pay all reasonable expenses of Lender incurred in connection therewith. Notwithstanding anything to the most recent Additional Insolvency Opinion delivered to Lendercontrary contained in this clause (j), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time holders of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control (or holders of interests in any entity directly or indirectly holding an interest in Borrower, ) as of the Rating Agencies date hereof (the "Interest Holders") shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned right to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the transfer their interest in Borrower (or any entity directly or indirectly holding an interest in Borrower) to another Person who is to be transferrednot an Interest Holder, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.including without limitation immediate family members for estate planning purposes, without Lender's consent; provided, however, that:
Appears in 2 contracts
Sources: Loan Agreement (Prime Group Realty Trust), Loan Agreement (Prime Group Realty Trust)
Transfers. (a) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) any Individual Property, the Property Collateral or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party (collectively, a “Transfer”), other than (A) the Operating LeasePermitted Encumbrances, (B) pursuant to pledges under the Mezzanine Loan, Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.205.1.17 hereof or a release or substitution of an Individual Property in accordance with the provisions of Section 2.5 or 2.6 hereof, without (Ci) the Room License Agreements, prior written consent of Lender and (Dii) Permitted Transfersif a Securitization has occurred, delivery to Lender of a Rating Confirmation.
(b) A Transfer shall include, but not be limited to: (i) an installment sales agreement wherein Borrower agrees to sell one or more Individual Properties, the Collateral or any part thereof for a price to be paid in installments; (ii) except as specifically permitted hereunder, an agreement by Mortgage Borrower leasing all or a substantial part of any Individual Property for other than actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Mortgage Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interests or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of
(c) Notwithstanding the provisions of Sections 5.2.10(a) and (b), the following transfers shall not be deemed to be a Transfer: (i) a transfer by devise or descent or by operation of law upon the death of a member, partner or shareholder of a Restricted Party (other than Mortgage Borrower or Borrower) or a Restricted Party (other than Mortgage Borrower or Borrower) itself; (ii) the Sale or Pledge, in one or a series of transactions, of not more than forty-nine percent (49%) of the stock in a Restricted Party other than Mortgage Borrower or Borrower; provided, however, no such transfers shall result in the change of voting control in the Restricted Party, and as a condition to each such transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed transfer and the identity of the proposed transferee; (iii) the Sale or Pledge, in one or a series of transactions, of not more than forty-nine percent (49%) of the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party other than Mortgage Borrower or Borrower; provided, however, as a condition to each such transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed transfer; (iv) the pledge of any interest in Borrower in connection with the Mezzanine Loan and the exercise of any rights or remedies Mezzanine Lender may have under the Mezzanine Loan Documents, as applicable; and (v) the sale, transfer or issuance of shares of stock in the REIT provided such shares of stock are listed on the New York Stock Exchange or such other nationally recognized stock exchange and provided the REIT complies with the provisions of Section 5.3 hereof.
(d) Notwithstanding anything to the contrary contained in this Section 5.2.10, the REIT must continue to be the sole general partner of, and control, the Operating Partnership and the Operating Partnership must continue to control Mortgage Borrower and own, directly or indirectly, at least a 100% interest in Mortgage Borrower.
(e) Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon a Transfer in violation of this Section 5.2.10. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer. Notwithstanding anything to the contrary contained in this Section 5.2.10, (a) no transfer (whether or not such transfer shall constitute a Transfer) shall be made to any Prohibited Person, (b) in the event of any transfer (whether or not such transfer shall constitute a Transfer, other than transfers of shares of stock in the REIT, provided that such shares of stock are listed on the New York Stock Exchange or such other nationally recognized stock exchange and provided the REIT complies with the requirements of Section 5.3 hereof), results in any Person and its Affiliates owning in excess of ten percent (10%) of the ownership interest in a Restricted Party Borrower shall provide to Lender, not less than thirty (30) days prior to such transfer, the name and identity of each proposed transferee, together with the names of its controlling principals, the social security number or employee identification number of such transferee and controlling principals, and such transferee’s and controlling principal’s home address or principal place of business, and home or business telephone number, and (c) in the event any transfer (whether or not such transfer shall constitute a Transfer), results in any Person and its Affiliates owning in excess of forty-nine percent (49%) of the ownership interest in a Restricted Party, Borrower shall, prior to such transfer, deliver an updated Insolvency Opinion to Lender, which opinion shall be in form, scope and substance acceptable in all respects to Lender and the Rating Agencies.
(f) Notwithstanding the foregoing, a sale Borrower shall have the right to permit or conveyance by cause Mortgage Borrower to transfer Personal Property to the Operating Tenant pursuant to Section 22.2 of the Operating Lease provided that (i) Borrower delivers to Lender an Officer’s Certificate certifying that the FF&E Limitation has been exceeded, (ii) the purchase price and value of the Personal Property transferred shall be the minimum amount necessary to comply with the FF&E Limitation, (iii) the Operating Tenant shall confirm that the Personal Property transferred to it is subject to the lien Operating Lease Security Agreement, (v) Borrower shall cause Mortgage Borrower to assign and pledge any FF&E Note and related security agreement and security interest to Mortgage Lender as additional security for the Debt and take all action as may be necessary to effect and perfect such assignment and security interest.
(g) Borrower may, without Lender’s consent, permit or cause Mortgage Borrower to grant easements, restrictions, covenants, reservations and rights of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into way in the ordinary course of operating business for access, water and sewer lines, telephone and telegraph lines, electric lines or other utilities or for other similar purposes or other purposes (which may include amendments to existing reciprocal easement agreements), provided that no such encumbrance or amendment set forth in this Section 5.2.10(g) shall materially impair the utility, operation and use of the applicable Individual Property or otherwise have a material adverse effect on the value of the Individual Property or on the financial condition or business of Borrower. In connection with any such grant permitted pursuant to this Section 5.2.10(g), Borrower shall cause Mortgage Borrower to deliver to Lender (a) twenty (20) days prior written notice thereof; (b) a copy of the instrument or instruments of such grant; (c) an Officer’s Certificate stating that such grant does not materially impair the utility, operation and use of the Property or have a material adverse effect on the value of the Property or the financial condition or business of Borrower, Mortgage Borrower or the condition or ownership of the Property); (d) is permitted provided that the following conditions are satisfied:
(i) no Event copies of Default shall have occurred all documents and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents deliveries required under of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, Mortgage Loan Agreement with respect to the Transferee such grants, and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(ve) the Transferee shall execute an assumption, effective as of the date of transfer, reimbursement of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable out-of-pocket costs and expenses (including any fees due to the Rating Agencies) incurred in connection with the sale or conveyancesuch grant.
(ch) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that Notwithstanding the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverforegoing, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with Mortgage Borrower entering into any Permitted Equipment Financing arrangements, provided Lender has received prior written notification of Mortgage Borrower’s intent to enter into such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the LoanPermitted Equipment Financing.
Appears in 2 contracts
Sources: Mezzanine Loan Agreement (Meristar Hospitality Operating Partnership Lp), Mezzanine Loan Agreement (Meristar Hospitality Corp)
Transfers. Beginning on the date hereof until the Termination Date, each Stockholder hereby covenants and agrees that, except as expressly permitted by this Proxy and Agreement, (a) Without such Stockholder shall not, directly or indirectly (i) tender any Covered Shares into any tender or exchange offer, (ii) offer, sell, transfer, assign, exchange, pledge, hypothecate, encumber or otherwise dispose of (collectively, “Transfer”) or enter into any contract, option, agreement, understanding or other arrangement with respect to the prior written consent Transfer of, any Covered Shares or beneficial ownership, voting power or any other interest thereof or therein (including by operation of Lenderlaw), and except pursuant to the Rollover Agreement (to the extent otherwise set forth in applicable to such Stockholder) or as a Permitted Transfer, (iii) grant any proxies or powers of attorney, deposit any Covered Shares into a voting trust or enter into a voting agreement with respect to any Covered Shares that is inconsistent with this Section 5.2.10 Proxy and Section 2.5 hereofAgreement, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower (iv) commit or Operating Lessee agree to do take any of the following foregoing actions. Notwithstanding the foregoing, but subject to the terms of the Rollover Agreement (to the extent applicable to such Stockholder), this Proxy and Agreement shall not restrict Transfers by a Stockholder of any or all of its Covered Shares to any of its Affiliates provided, that prior to and as a condition to the effectiveness of such Transfer, such Affiliate shall have executed and delivered to the Company a counterpart of this Proxy and Agreement pursuant to which such Affiliate shall be bound by all of the terms and provisions of this Proxy and Agreement. Any Transfer in violation of this Section 3.1 shall be void ab initio. “Permitted Transfer” shall mean (A) a pledge, hypothecation, or collateral assignment of, or grant of a security interest in, Covered Shares or any interest or rights therein as security or collateral for a bona fide loan or other obligation (collectively, a “TransferPledge”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect interest therein), or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) after notice to the Acquiror, the transfer or conversion of ownership of Covered Shares or any interests or rights therein to a lender or other beneficiary of the Pledge pursuant to Leases of space in a foreclosure thereof following a default under the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien loan or other encumbrance (other than obligation secured by the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyancePledge.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.
Appears in 2 contracts
Sources: Irrevocable Proxy and Agreement (Us Xpress Enterprises Inc), Irrevocable Proxy and Agreement (Us Xpress Enterprises Inc)
Transfers. (a) Borrower acknowledges that ▇▇▇▇▇▇ has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the 156506983 Property in agreeing to make the Loan, and will continue to rely on ▇▇▇▇▇▇▇▇’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of and all other obligations of Borrower under this Agreement, the Security Instrument, the Note and the other Loan Documents. Borrower acknowledges that ▇▇▇▇▇▇ has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the other obligations of Borrower under this Agreement, the Security Instrument, the Note and the other Loan Documents, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender▇▇▇▇▇▇, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof7.1, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party do any of the following (individually and collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, (ii) enter into any PACE Loan or (iiiii) permit a Sale or Pledge of a any direct or indirect interest in Borrower or Operating Lessee, Borrower; other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 4.15 and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents and Profits; (iii) if a Restricted Party is a corporation, any merger, consolidation or a Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; (vii) any change in Control of any Individual Borrower is permitted provided that the following conditions are satisfied:or Guarantor, directly or indirectly.
(id) if such sale or conveyance occurs prior to a SecuritizationNotwithstanding the provisions of this Section 7.1, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender▇▇▇▇▇▇’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly connection with one or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers Transfers, of not more than forty-nine percent (49% %) of the direct or indirect ownership interests in any Individual Borrower or Guarantor or a REIT Transfer; provided, however, in each case, each of the following conditions (collectively, the “Transfer Conditions”) are satisfied: (i) intentionally omitted; (ii) if such Transfer is a KYC Triggering Transfer, (A) Lender shall receive not less than thirty (30) days prior written notice of such proposed Transfer and (B) Lender shall have performed searches and/or received other diligence such that Lender is in compliance with Lender’s then current “know your customer” requirements 156506983 and Lender shall have received Satisfactory Search Results, at Borrower’s cost and expense, with respect to the applicable transferee; (iii) Borrower shall remake (or if such Transfer is not a KYC Triggering Transfer, Borrower shall be transferred deemed to a Person individually or together with its Affiliates not owning at least 49% have automatically remade, effective as of the direct or indirect ownership interests in Borrower immediately prior date of the consummation of such Transfer) the representations and warranties contained herein relating to such Transfer ERISA, OFAC and Prohibited Persons (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)and, upon ▇▇▇▇▇▇’s request, each Individual Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, Officer’s Certificate containing such updated representations effective as of the Rating Agencies and their respective counsel, successors and assigns, with respect to date of the proposed transfer or sale, which Additional Insolvency Opinion consummation of the applicable Transfer); (iv) no Event of Default shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) continuing at the time of such Transfer no and such Transfer shall not result in the occurrence of an Event of Default has occurred Default; and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) ifat all times, after giving effect General Partner must continue to such Transfer, Sponsor does not own at least 51% (A) Control each of the equity interests in Borrower and control Individual Borrower, the Rating Agencies shall have confirmed that such Transfer, in Guarantor and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
any Affiliated Manager and (viB) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and controlown, directly or indirectly, at least a 51% legal and beneficial interest in each Individual Borrower, Guarantor and any Affiliated Manager. Upon request from ▇▇▇▇▇▇, Borrower shall give or cause to be given written notice promptly provide Lender with a revised version of the organizational chart delivered to Lender of in connection with the proposed Loan reflecting any Transfer not later than fifteen consummated in accordance with this Section 7.1(d).
(15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (Ae) Lender shall have not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon ▇▇▇▇▇▇▇▇’s Transfer without ▇▇▇▇▇▇’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany previous Transfer.
Appears in 2 contracts
Sources: Loan Agreement (Wheeler Real Estate Investment Trust, Inc.), Loan Agreement (Wheeler Real Estate Investment Trust, Inc.)
Transfers. Beginning on the date hereof until the Termination Date, each Stockholder hereby covenants and agrees that, except as expressly permitted by this Proxy and Agreement, (a) Without such Stockholder shall not, directly or indirectly (i) tender any Covered Shares into any tender or exchange offer, (ii) offer, sell, transfer, assign, exchange, pledge, hypothecate, encumber or otherwise dispose of (collectively, “Transfer”) or enter into any contract, option, agreement, understanding or other arrangement with respect to the prior written consent Transfer of, any Covered Shares or beneficial ownership, voting power or any other interest thereof or therein (including by operation of Lenderlaw), and except pursuant to the Rollover Agreement (to the extent otherwise set forth in applicable to such Stockholder) or as a Permitted Transfer, (iii) grant any proxies or powers of attorney, deposit any Covered Shares into a voting trust or enter into a voting agreement with respect to any Covered Shares that is inconsistent with this Section 5.2.10 Proxy and Section 2.5 hereofAgreement, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower (iv) commit or Operating Lessee agree to do take any of the following foregoing actions. Notwithstanding the foregoing, but subject to the terms of the Rollover Agreement (to the extent applicable to such Stockholder), this Proxy and Agreement shall not restrict Transfers by a Stockholder of any or all of its Covered Shares to any of its Affiliates provided, that prior to and as a condition to the effectiveness of such Transfer, such Affiliate shall have executed and delivered to the Company a counterpart of this Proxy and Agreement pursuant to which such Affiliate shall be bound by all of the terms and provisions of this Proxy and Agreement. Any Transfer in violation of this Section 3.1 shall be void ab initio. “Permitted Transfer” (A) a pledge, hypothecation, or collateral assignment of, or grant of a security interest in, Covered Shares or any interest or rights therein as security or collateral for a bona fide loan or other obligation (collectively, a “TransferPledge”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect interest therein), or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) after notice to the Acquiror, the transfer or conversion of ownership of Covered Shares or any interests or rights therein to a lender or other beneficiary of the Pledge pursuant to Leases of space in a foreclosure thereof following a default under the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien loan or other encumbrance (other than obligation secured by the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyancePledge.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.
Appears in 2 contracts
Sources: Irrevocable Proxy and Agreement (Fuller Max L), Irrevocable Proxy and Agreement (Knight-Swift Transportation Holdings Inc.)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners, as applicable, in owning and operating properties such as the Properties in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Properties as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Properties so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Properties.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) any of the Property Properties or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) permit a Sale or Pledge of a direct or indirect any interest in Borrower any Restricted Party (any of the actions in the foregoing clauses (i) or Operating Lessee(ii), a “Transfer”), other than (A) the Operating Lease, (B) Transfers pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements5.1.20 hereof, and (DB) Transfers that are Permitted Transfers.
(bTransfers in accordance with Section 5.2.10(g) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyancehereof.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell any of the Property, or any part thereof, for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or substantially all of any of the Properties for other than actual occupancy by a space tenant thereunder, hypothecationor a sale, creation assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other encumbrancethan in accordance with Section 5.1.22 hereof.
(d) Notwithstanding the provisions of this Section 5.2.10, but subject to the terms and conditions set forth below in clause (g) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverthis Section 5.2.10, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% in connection with one or a series of the equity Transfers of: (i) direct or indirect interests in Borrower among the Sponsors and controls, directly or indirectly, Borrower;
any Sponsor Controlled Parties; (ii) if as a result of any such Transfer or series of Transfers not more than forty-nine percent (49% %) of the direct or indirect ownership stock, general partnership interests, the limited partnership interests, the managing member interests or non-managing membership interests (as the case may be) in Borrower, Principal or any other Restricted Party; (iii) the sale, transfer or issuance of stock in any Restricted Party so long as such stock is listed on the New York Stock Exchange or another nationally or internationally recognized stock exchange; or (iv) direct or indirect interests in Borrower for estate planning purposes by any Sponsor to the spouse, child, parent, grandparent, grandchild, niece, nephew, aunt or uncle of such Sponsor, or to a trust for the benefit of such Sponsor or for the benefit of the spouse, child, parent, grandparent, grandchild, niece, nephew, aunt or uncle of such Sponsor. Furthermore, subject to the terms and conditions set forth in clause (g) of this Section 5.2.10, Lender’s consent shall not be required in connection with a Sponsor Transfer.
(e) Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon a Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer.
(f) There shall be transferred to a Person individually or together with its Affiliates not owning at least 49% no assumption of the direct or indirect ownership interests in Borrower immediately Loan during the period that is thirty (30) days prior to such Transfer and continuing until thirty (or 30) days following the Securitization of any portion of the Loan. Other than as reflected set forth in the most recent Additional Insolvency Opinion delivered to Lender)preceding sentence, Borrower shall deliver have the right to Lender an Additional Insolvency Opinion which may unlimited Transfers of all of the Properties (and not a portion thereof) with Lender’s consent, not to be relied upon by Lenderunreasonably withheld, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer provided no Event of Default has occurred and is continuing, and Lender receives thirty (30) days’ prior written notice of such Transfer and a non-refundable application fee of $5,000 at the time Lender’s consent is sought, and further provided that the following additional requirements are satisfied:
(i) Borrower shall pay Lender a transfer fee equal to one half of one percent (.5%) of the Outstanding Principal Balance at the time of such Transfer (for the avoidance of doubt, this transfer fee shall not apply in the case of a Sponsor Transfer);
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(viii) Borrower shall pay, or cause to be paid, to Lender its pay any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs incurred in connection with such sale Transfer (including, without limitation, Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes, servicer costs and fees and the fees and expenses of the Approved Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or conveyanceTransferee’s Principals must have the creditworthiness, reputation and qualifications to Lender’s reasonable satisfaction;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not reasonably acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 5.1.23, 5.2.9 and 5.2.12 hereof, no Default or Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements and covenants reasonably required by Lender;
(x) Each Approved Rating Agency shall have issued a Rating Agency Confirmation with respect to such Transfer;
(xi) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion reflecting such Transfer satisfactory in form and substance to Lender and each Approved Rating Agency;
(xii) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and the Environmental Indemnity or shall execute a replacement guaranty and environmental indemnity in form and substance reasonably satisfactory to Lender;
(xiii) Borrower shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policy, as modified by the assumption agreement, as a valid first lien on the Properties and naming the Transferee as owner of the Properties, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Properties shall not be subject to any additional exceptions or liens other than those contained in the Title Insurance Policy issued on the date hereof and the Permitted Encumbrances;
(xiv) If required under the terms hereof, the Property shall be managed by a Qualified Manager pursuant to a Replacement Management Agreement; and
(viixv) Immediately upon a Transfer to such Transferee and the satisfaction of all of the above requirements, the named Borrower and Guarantor herein shall be released from all liability under this Agreement, the Note, the applicable Security Instrument and the other Loan Documents accruing after such Transfer. The foregoing release shall be effective upon the date of such Transfer, but Lender agrees to provide written evidence thereof reasonably requested by Borrower.
(g) Notwithstanding anything to the contrary in connection with this Agreement or any other Loan Documents, each Permitted Transfer shall be conditioned upon: (i) no such Transfer resulting in the change of Control in Borrower such that a Sponsor Controlled Party does not Control each of Borrower, any Affiliated Manager, and any Principal and the day-to-day operation of the Property, (ii) other than a Transfer pursuant to clause (d)(iii) above, Lender receiving not less than thirty (30) days’ prior notice of such Transfer (or in the case of any Transfer as pursuant to clause (a) or (b) set forth herein in the definition of “Permitted Transfer”, Lender receiving notice within thirty (30) days of any such Transfer), (iii) if a result of which Manager is required under Section 5.1.22, the Property continuing to be managed by Affiliated Manager or a Qualified Manager approved in accordance with the terms and conditions hereof, (iv) Sponsor will not continuing to directly or indirectly own at least 51a 20% equity interest in each of the equity interests in Borrower and controlany Principal both prior to and after such Transfer, directly or indirectly(v) other than a Transfer pursuant to clause (d)(iii) above, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the each proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented remaking the representations contained herein applicable to such Transfer proposed transferee, including those relating to Special Purpose Entity requirements, ERISA matters, the USA Patriot Act, OFAC and matters concerning Embargoed Persons and (B) satisfying, to Lender’s satisfaction, Lender’s “know your customer” requirements relating to the creditworthiness, reputation, background and qualifications of such proposed transferee, provided, however, that Lender’s “know your customer” requirements will not apply if such proposed transferee owns or will own less than a ten percent (10%) direct or indirect interests in Borrower, (vi) such Transfer being permitted under the terms of the REA, and (vii) other than in the case of any Transfer pursuant to clause (a) or (b) set forth herein in the definition of “Permitted Transfer” or a Transfer pursuant to clause (d)(iii) above, no Event of Default continuing on the date such Transfer occurs and on the day after such Transfer occurs. Upon request from Lender, Borrower shall pay promptly provide Lender a revised version of the organizational chart delivered to Lender a loan assumption fee in connection with the Loan reflecting any Permitted Transfer consummated in accordance with this Section 5.2.10. If after giving effect to any such Transfer, more than forty-nine percent (49%) in the aggregate of 1% direct or indirect interests in Borrower are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in Borrower as of the then outstanding principal amount Closing Date, Borrower shall, no less than thirty (30) days prior to the effective date of any such Transfer (other than a Transfer pursuant to clause (d)(iii) above), deliver to Lender an Additional Insolvency Opinion acceptable to Lender and the LoanRating Agencies.
Appears in 2 contracts
Sources: Loan Agreement (Global Medical REIT Inc.), Loan Agreement (Global Medical REIT Inc.)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions are satisfied:creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(id) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverNotwithstanding the provisions of this Section 5.2.10, Lender’s consent shall not be required ifin connection with one or a series of Transfers, of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such Transfer shall result in the change of Control in a Restricted Party, and as a condition to each such Transfer, Lender shall receive not less than thirty (30) days prior notice of such proposed Transfer. If after giving effect to the any such Transfer, Sponsor owns not more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than 51% forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the equity interests in Closing Date, Borrower and controlsshall, directly or indirectly, Borrower;
no less than thirty (ii30) if as a result days prior to the effective date of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Transfer, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, and the Rating Agencies;. In addition, at all times, (a) Guarantor must continue to Control, and own, directly or indirectly, in the aggregate, at least a 51% legal and beneficial interest in, Borrower, and (b) Acadia Realty Trust must continue to Control, and own, directly or indirectly, at least a 20% legal and beneficial interest in, each of Guarantor and any Affiliated Manager.
(iiie) at No consent to any assumption of the time Loan shall occur on or before the date that is twelve (12) Payment Dates after the Completion of the Improvements. Thereafter, Lender’s consent to a Transfer of the Property and assumption of the Loan shall not be unreasonably withheld provided that Lender receives sixty (60) days prior written notice of such Transfer and no Event of Default has occurred and is continuing, and further provided that the following additional requirements are satisfied for all Transfers other than those described in subsection (d) above:
(i) Borrower shall pay Lender at the time of such Transfer a transfer fee equal to one half of one percent (0.5%) of the outstanding principal balance of the Loan for the first Transfer and one percent (1.0%) of the outstanding principal balance of the Loan for each subsequent Transfer;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(viii) Borrower shall pay, or cause to be paid, to Lender its pay any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs incurred in connection with such sale Transfer (including, without limitation, Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or conveyanceTransferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Property, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate Net Worth and Liquidity reasonably acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not reasonably acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 4.1.35, 5.1.46 and 5.2.10 of this Agreement, no Default or Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements and covenants reasonably required by Lender;
(x) Transferee shall be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a requalification, reduction, downgrade or withdrawal of the ratings in effect immediately prior to such assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion reflecting such Transfer satisfactory in form and substance to Lender;
(xii) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty of Completion, the Guaranty of Recourse Carveouts and the Environmental Indemnity executed by Guarantor or execute replacement guaranties and environmental indemnity reasonably satisfactory to Lender;
(xiii) Borrower shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policy, as modified by the assumption agreement, as a valid first lien on the Property and naming the Transferee as owner of the Property, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Property shall not be subject to any additional exceptions or liens other than those contained in the Title Policy issued on the date hereof and the Permitted Encumbrances; and
(viixiv) in connection with any The Property shall be managed by a Qualified Manager pursuant to a Replacement Management Agreement. Immediately upon a Transfer as a result to such Transferee and the satisfaction of which Sponsor will not own at least 51% all of the equity interests in above requirements, the named Borrower and controlGuarantor herein shall be released from all liability under this Agreement, directly or indirectlythe Note, Borrower, Borrower the Mortgage and the other Loan Documents accruing after such Transfer. The foregoing release shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth effective upon the date the Transfer is expected of such Transfer, but Lender agrees to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanprovide written evidence thereof reasonably requested by Borrower.
Appears in 2 contracts
Sources: Building Loan Agreement (Acadia Realty Trust), Building Loan Agreement (Acadia Realty Trust)
Transfers. (a) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof, Borrower Tenant shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether (a) assign, transfer, mortgage, pledge, hypothecate or not for consideration or of record) otherwise encumber this Lease, the Property Premises or any direct part of or indirect interest thereinin this Lease or the Premises, (b) grant any concession or license within the Premises, (c) sublet all or any part of the Premises or any right or privilege appurtenant to the Premises, or (iid) permit a Sale any other party to occupy or Pledge use all or any part of a direct or indirect interest in Borrower or Operating Lessee, other than the Premises (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoingcollectively, a sale or conveyance by Borrower "TRANSFER"), without the prior written consent of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyanceLandlord, which consent shall not be unreasonably withheld;
, conditioned or delayed. This prohibition against a Transfer includes, without limitation, (i) any subletting or assignment which would otherwise occur by operation of law, merger, consolidation, reorganization, transfer or other change of Tenant's corporate or proprietary structure; (ii) an assignment or subletting to or by a receiver or trustee in any federal or state bankruptcy, insolvency, or other proceedings; (iii) the sale, assignment or transfer of all or substantially all of the assets of Tenant, with or without specific assignment of Lease; (iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after change in control in a Securitization, the Rating Agencies;
partnership; or (v) conversion of Tenant to a limited liability entity. If Tenant converts to a limited liability entity without obtaining the Transferee prior written consent of Landlord: (i) the conversion shall execute an assumption, effective as be null and void for purposes of the date of transferLease, including the determination of all obligations and liabilities of Tenant and its partners to Landlord; (ii) all partners of Tenant immediately prior to its conversion to a limited liability shall be fully liable, jointly and severally, for obligations of Tenant accruing under this Lease pre-conversion and post-conversion, and all members and other equity holders in Tenant post-conversion shall be fully liable for all obligations and liabilities of Tenant accruing under the Lease after the date such members and other equity holders are admitted to the limited liability entity as if such person or entity had become a general partner in a partnership; and (iii) Landlord shall have the option of declaring Tenant in default under this Lease. If Tenant requests Landlord's consent to any Transfer, then Tenant shall provide Landlord with a written description of all terms and conditions of the obligations proposed Transfer, copies of the Borrower thereafter arising proposed documentation, and the following information about the proposed transferee: name and address; reasonably satisfactory information about its business and business history; its proposed use of the Premises; a copy of the proposed sublease or assignment agreement; banking, financial and other credit information; and general references sufficient to enable Landlord to determine the proposed transferee's creditworthiness and character. Landlord's consent to a Transfer shall not release Tenant from performing its obligations under this Lease, but rather Tenant's transferee shall assume all of Tenant's obligations under this Lease in a writing satisfactory to Landlord, and Tenant and its transferee shall be jointly and severally liable therefor. Landlord's consent to any Transfer shall not waive Landlord's rights as to any subsequent Transfer. While the Premises or any part thereof are subject to a Transfer, Landlord may collect directly from such transferee all rents or other sums relating to the Premises becoming due to Tenant or Landlord and apply such rents and other sums against the Rent and any other sums payable hereunder. If the aggregate rental, bonus or other consideration paid by a transferee for any such space exceeds the sum of (y) Tenant's Rent to be performed under this Agreement, the Mortgage paid to Landlord for such space during such period and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof (z) Tenant's costs and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to expenses actually incurred in connection with such Transfer, Sponsor does not own at least 51% including reasonable brokerage fees, reasonable costs of finishing or renovating the equity interests in Borrower space affected and control Borrowerreasonable cash rental concessions, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable which costs and expenses are to be amortized over the term of the Transfer, then fifty percent (including any fees due 50%) of such excess shall be paid to Landlord within fifteen (15) days after such amount is earned by Tenant. Such arrearage amounts in the case of a sublease shall be calculated and adjusted (if necessary) on a Lease Year (or partial Lease Year) basis, and there shall be no cumulative adjustment for the Term. Landlord shall have the right to audit Tenant's books and records relating to the Rating AgenciesTransfer. Tenant authorizes its transferees to make payments of rent and any other sums due and payable, directly to Landlord upon receipt of notice from Landlord to do so. Any attempted Transfer by Tenant in violation of the terms and covenants of this ARTICLE IX shall be void. In the event that Tenant requests that Landlord consider a sublease or assignment hereunder, Tenant shall pay (i) Landlord's reasonable and documented expenses, not to exceed Five Hundred and No/100 Dollars ($500.00) per transaction, actually incurred in connection with the consideration of such request, and (ii) all reasonable attorneys' fees and costs incurred by Landlord in connection with the consideration of such request or such sublease or assignment. Notwithstanding any provision to the contrary, Tenant may assign this Lease or sublet the Premises without Landlord's consent (i) to any corporation or other entity that controls, is controlled by or is under common control with Tenant; (ii) to any corporation or other entity resulting from a merger, acquisition, consolidation or reorganization of or with Tenant; (iii) in connection with the sale of all or conveyance.
substantially all of the assets of Tenant, so long as Tenant provides evidence to Landlord in writing that such assignment or sublease complies with the criteria set forth in (ci), (ii) A Transfer or (but not a pledge, hypothecation, creation of a security interest in or other encumbranceiii) of any direct or indirect interests in Borrower is permitted above and provided that the following conditions are satisfied:
met: (i1) the net worth of the transferee is equal to or greater than the greater of Tenant's net worth on the date of this Lease, (2) if such sale or conveyance occurs prior to Tenant remains in existence as a Securitizationseparate legal entity following the transfer, Lender shall have consented to such sale or conveyance, which consent it shall not be unreasonably withheld; provided howeverreleased from liability under this Lease, Lender’s consent (3) the transferee shall not be required if, after giving effect assume in a writing delivered to Landlord all of Tenant's obligations under the Transfer, Sponsor owns not less than 51% Lease effective upon the consummation of the equity interests in Borrower transfer, and controls, directly or indirectly, Borrower;
(ii4) if as a result Tenant shall give written notice to Landlord of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name in advance of the Person consummation thereof. Any transferee that meets the criteria in this paragraph shall hereinafter be referred to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender as a loan assumption fee of 1% of the then outstanding principal amount of the Loan"PERMITTED TRANSFEREE".
Appears in 2 contracts
Sources: Lease (Texas Roadhouse, Inc.), Lease (Texas Roadhouse, Inc.)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and Mortgage Borrower and their stockholders, general partners, members, principals and (if Borrower or Mortgage Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Mortgage Borrower’s ownership of the Property and Borrower’s ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Collateral and the Property so as to ensure that, should Borrower default in the repayment of the Debt, Lender can recover the Debt by a sale of the Collateral.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Mortgage Borrower or Operating Lessee any Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Collateral or the Property or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) permit a Sale or Pledge of a direct any Equity Interests in Borrower, Mortgage Borrower, or indirect interest any Restricted Party. Any Transfer made in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases violation of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) this Agreement shall be void. Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject foregoing to the lien of the Mortgage (but not any other mortgagecontrary, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which Transfers may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays occur without Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyanceprior written consent.
(c) A Transfer (shall include, but not be limited to: (i) an installment sales agreement wherein Borrower agrees to sell the Collateral or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Mortgage Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Mortgage Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the Equity Interests of any direct general partner or indirect any profits or proceeds relating to such Equity Interests, or the Sale or Pledge of Equity Interests of limited partners or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non member manager (or if no managing member, any member) or the Sale or Pledge of the Equity Interests of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non managing membership interests or the creation or issuance of new non managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions creation or issuance of new legal or beneficial interests; (vii) the removal or the resignation of the managing agent (including an Affiliated Manager) other than in accordance with the terms of this Agreement; or (viii) the cash flow from the Property (or Borrower’s rights to cash distributions from Mortgage Borrower) or any portion thereof are satisfied:sold, assigned, transferred, hypothecated, pledged or otherwise encumbered, directly or indirectly, or occurring by operation of law or otherwise, other than pursuant to the Mortgage Loan Documents.
(id) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverNotwithstanding the provisions of this Section 5.2.9, Lender’s consent shall not be required ifin connection with one or a series of Transfers, of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in Borrower or Guarantor; provided, however, no such Transfer shall result in the change of Control in a Borrower or Guarantor, and as a condition to each such Transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed Transfer. If after giving effect to the any such Transfer, Sponsor owns not less more than 51% forty-nine percent (49%) in the aggregate of the equity direct or indirect interests in Borrower or Guarantor are owned by any Person and controlsits Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such party as of the Closing Date, directly or indirectlyBorrower shall, Borrower;
no less than thirty (ii30) if as a result days prior to the effective date of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Transfer, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, and the Rating Agencies.
(e) Solely in connection with a sale of the Property permitted pursuant to and in accordance with Section 5.2.10(e) of the Mortgage Loan Agreement, a new borrower (“New Borrower”), owning indirectly 100% of the unencumbered equity interests in the proposed new owner of the Property (the “New Owner”) may assume Borrower’s obligations hereunder (hereafter, a “Proposed Loan Assumption”) provided that each of the following terms and conditions is satisfied in Lender’s discretion:
(i) each of the New Borrower and New Owner are approved by Lender;
(ii) each of the conditions set forth in Section 5.2.10 of the Mortgage Loan Agreement has been satisfied, as determined by Mortgage Lender;
(iii) at the time of such Transfer no Event of Default has occurred and is continuingcontinuing and no event shall have occurred that by the passage of time or delivery of notice would become an Event of Default;
(iv) following Borrower shall give Lender written notice of such Transfer request not less than sixty (60) days prior to the property manager proposed date of the Property must be such Transfer and such Proposed New Assumption does not occur 60 days prior to or 60 days after a Qualified ManagerSecuritization;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its pay any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs incurred in connection with such sale Transfer (including Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies, if applicable);
(vi) If applicable, Lender has received a Rating Agency Confirmation regarding the Proposed Loan Assumption;
(vii) New Borrower shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including by entering into an assumption agreement in form and substance satisfactory to Lender;
(viii) Borrower shall pay Lender a transfer fee equal to one percent (1%) of the outstanding principal balance of the Loan at the time of such Transfer;
(ix) Lender shall have received such documents, certificates and legal opinions as it may reasonably request;
(x) New Owner, New Borrower and the property manager shall have sufficient experience in the ownership and management of properties similar to the Property, and Lender shall be provided with reasonable evidence thereof (and Lender reserves the right to approve the New Borrower without approving the substitution of the property manager);
(xi) prior to any release of the Guarantor, a substitute guarantor acceptable to Lender shall have assumed the Guaranty executed by Guarantor or conveyanceexecuted a replacement guaranty reasonably satisfactory to Lender;
(xii) Borrower and New Borrower execute, without any cost or expense to Lender, any additional documents reasonably requested by Lender to evidence and perfect Lender’s interests under the Loan Documents;
(xiii) New Borrower delivers certificated securities to Lender representing 100% of the equity ownership interests in New Owner (such interests, along with any other collateral securing the Loan, the “New Collateral”) and grants Lender a perfected first priority lien in such New Collateral;
(xiv) New Borrower delivers to Lender, without any cost or expense to Lender, such endorsements to Lender’s “Eagle 9” or “UCC Plus” (or equivalent) insurance policy which insures Lender’s lien in the New Collateral, hazard insurance policy endorsements or certificates and other similar materials as Lender may reasonably deem necessary at the time of the Proposed Loan Assumption, all in form and substance satisfactory to Lender; and
(viixv) Lender may, as a condition to evaluating any requested consent to a transfer, require that Borrower post a cash deposit with Lender in an amount equal to Lender’s anticipated costs and expenses in evaluating any such request for consent. The foregoing release shall be effective upon the date of such Transfer, but Lender agrees to provide written evidence thereof reasonably requested by Borrower.
(f) Notwithstanding any provision in this Section 5.2.9 to the contrary, limited partnership or membership interests, as applicable, in Borrower may be transferred without Lender’s consent and without application of the fee set forth in Section 5.2.9(e)(viii): (i) among limited partners or members, as applicable, of Borrower who are limited partners or members, as applicable, of Borrower as of the date of this Agreement (each a “Current Owner”), and (ii) to immediate family members (which shall be limited to a spouse, parent, child and grandchild (each, an “Immediate Family Member”)), of any Current Owner or to trusts formed for the benefit of Immediate Family Members of such Current Owner for bona fide estate planning purposes (each, an “Additional Permitted Transfer”), provided each of the following conditions is satisfied: (A) no Event of Default has occurred and no event has occurred that with notice and/or the passage of time, or both, would constitute an Event of Default; (B) Lender has received Borrower’s notice of the Additional Permitted Transfer no less than 30 days prior to the commencement of such transfer; (C) no Indemnitor or Guarantor shall be released from any guaranty or indemnity agreement by virtue of the Additional Permitted Transfer; (D) Borrower shall be responsible for the costs and expenses of documenting the Additional Permitted Transfer; (E) Borrower shall reimburse Lender for all actual costs and expenses incurred by Lender in connection with the Additional Permitted Transfer, whether or not consummated; (F) once the Additional Permitted Transfer is complete, the persons with Control of Borrower and management of the Property are the same persons who have such Control and management rights immediately prior to the Additional Permitted Transfer; (G) Borrower shall furnish Lender copies of any documentation executed in connection with the Additional Permitted Transfer promptly after execution thereof; (H) Borrower shall have delivered satisfactory evidence to Lender that, following the Additional Permitted Transfer, Borrower shall continue to comply with the provisions of Section 4.1.20 hereof; (I) upon Lender’s request, delivery of an Additional Insolvency Opinion acceptable to Lender; and (J) the Additional Permitted Transfer is permitted under the Mortgage Loan Documents.
(g) Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer.
(h) Borrower shall pay all costs and expenses of Lender in connection with any Transfer as a result Transfer, including all fees and expenses of which Sponsor will not own at least 51% Lender’s counsel, whether internal or outside, and the cost of the equity interests in Borrower any required counsel opinions related to REMIC or other securitization or tax issues and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany Rating Agency fees.
Appears in 2 contracts
Sources: Mezzanine Loan Agreement, Mezzanine Loan Agreement (TNP Strategic Retail Trust, Inc.)
Transfers. Beginning on the date hereof until the Termination Date, each Stockholder hereby covenants and agrees that, except as expressly contemplated by this Agreement, (a) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof, Borrower such Stockholder shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect interest therein, or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies its Affiliates and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does Representatives not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controlsto, directly or indirectly, Borrower;
(i) tender any Covered Shares into any tender or exchange offer, (ii) if as a result offer, sell, transfer, assign, exchange, pledge, hypothecate, hedge, gift, loan, encumber or otherwise dispose of (collectively, “Transfer”) or enter into any such Transfer Contract, option, agreement, understanding or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, other arrangement with respect to the proposed transfer Transfer of, any Covered Shares or salebeneficial ownership, which Additional Insolvency Opinion voting power or any other interest thereof or therein (including by operation of law), (iii) grant any proxies or powers of attorney, deposit any Covered Shares into a voting trust or enter into a voting agreement with respect to any Covered Shares that is inconsistent with this Agreement, or (iv) commit or agree to take any of the foregoing actions. Any Transfer in violation of this Section 4.1 shall be void ab initio. Notwithstanding anything to the contrary in this Agreement, any Stockholder may Transfer any or all of the Covered Shares, in accordance with applicable law, to (A) such Stockholder’s Affiliates or (B) to any custodian or nominee for the purpose of the Covered Shares for the account of such Stockholder; provided, that, prior to and as a condition to the effectiveness of such Transfer contemplated by the foregoing clause (A), each Person to whom any of such Covered Shares or any interest in any of such Covered Shares is or may be transferred shall have executed and delivered to Parent a counterpart of this Agreement in a form reasonably acceptable to Lender andParent pursuant to which such Affiliate shall be bound by all of the terms and provisions hereof in which case such Affiliate shall be deemed a Stockholder hereunder, after a Securitizationand the transferor shall remain liable for all of its obligations hereunder. From the date hereof until the Exchange Time, subject to the immediately preceding sentence, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager Stockholders shall retain all of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the LoanShares.
Appears in 2 contracts
Sources: Support Agreement (HireRight Holdings Corp), Support Agreement (HireRight Holdings Corp)
Transfers. (a) Without By delivery of this Agreement, Borrower acknowledges that the financial standing and managerial and operational ability of Borrower are substantial and material considerations to Lender in its agreement to make the Loan and that any encumbrance or transfer of an interest in any Asset or in Borrower whether direct or indirect, will materially impair Lender’s security under the Security Instrument. To induce Lender to make the Loan, Borrower agrees Borrower shall not effect a Transfer, either directly or indirectly, or by operation of law, without in each instance first obtaining Lender’s prior written consent, which consent may be withheld for any reason, or given upon such terms and conditions as Lender deems necessary or appropriate, all within Lender’s sole and absolute discretion, to the extent permitted by Applicable Law. Upon any Transfer made in violation of this Section 9.9 but subject to the cure rights contained in Section 11.1(g), without limitation on Lender’s other rights, Lender shall have the absolute right in its sole discretion, without demand or notice, to declare all sums, indebtedness and obligations secured by this Agreement and the other Loan Documents to be immediately due and payable (including the Yield Maintenance (as defined in the Note)), except to the extent otherwise set forth that and in this Section 5.2.10 and Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any such particular circumstances where exercise of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (voluntarily or involuntarily, such right by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect interest therein, or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) Lender is prohibited by law. Any Transfer effected pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance consent by Borrower of the Property Lender shall be subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage Agreement and the other Loan Documents, subjectand any direct transferee shall, as a condition of the effectiveness of any such consent and as a covenant of Borrower and such transferee, and in form and substance prescribed by Lender, assume all obligations hereunder and agree to be bound by all provisions contained herein. Such assumption shall not, however, to the provisions of Section 9.3 hereof and upon such assumption, release Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale any maker or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses guarantor (including any fees due Asset Guarantor or Guarantor) from any liability thereunder. Notwithstanding anything to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledgecontrary contained herein, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions shall not constitute a “Transfer” and are satisfiedhereby expressly acknowledged and permitted by Lender:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result The transfer of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Guarantor, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lenderincluding, without limitation, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer of any common or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;preferred stock; or
(iiiii) at Any tenant lease of Property entered into by Borrower in accordance with the time terms and conditions of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanthis Agreement.
Appears in 2 contracts
Sources: Loan Agreement (IMH Financial Corp), Loan Agreement (IMH Financial Corp)
Transfers. (a) Without Each Shareholder agrees to execute a customary lock-up agreement with the underwriters in connection with the IPO, provided that the duration of the lock-up period shall not exceed 180 days. In addition, each Shareholder agrees, other than as contemplated in the registration statement therefore, (i) not to Transfer any of its Securities in a manner that would not be permitted under the terms of the Original Shareholders Agreement, (ii) not to take any other action that would not be permitted under the terms of the Original Shareholders Agreement (or if action can only be taken with the consent or approval of one or more Persons, not to take any such action without obtaining the consent(s) or approval(s) of the Person(s) specified in the Original Shareholders Agreement), or (iii) fail to take any action required to be taken by the Original Shareholders Agreement, in each of such cases (i), (ii) and (iii), prior written consent to the earlier of Lender(x) the consummation of the IPO and (y) the date that is ten Business Days after the date of this Agreement. For the avoidance of doubt, the ten Business Day time period set forth in clause (y) of the immediately preceding sentence shall not expire before the ten Business Day time period set forth in Section 4.16.
(b) Any and all rights and obligations under this Agreement that apply to a Shareholder will apply with equal force to any Person to whom such Shareholder Transfers (in compliance with this Agreement) Securities, and except it will be a condition to any Transfer of Securities otherwise permitted by this Agreement that the Transferee execute an agreement by which the Transferee agrees to become a party to and be bound by this Agreement, and acknowledges that the Securities Transferred to such Transferee by a Shareholder will be subject to the terms of this Agreement, unless such Transfer is made (i) pursuant to an offering registered under the Securities Act, or to the public through a broker, dealer or market-maker pursuant to Rule 144 promulgated thereunder, (ii) in a transaction that will result in the termination of this Agreement or (iii) by any Sponsor Holder to the limited partners or other equity owners of such Sponsor Holder.
(c) Any attempt by a Shareholder to Transfer any Securities not in compliance with this Agreement will be null and void and any such improper Transfer will not be registered, or otherwise recognized in the Corporation’s records. No Shareholder will enter into any transaction or series of transactions for the purpose or with the effect of, directly or indirectly, denying or impairing the rights or obligations of any other Person under this Agreement, and any such transaction will be null and void and, to the extent that such transaction requires any action by the Corporation, it will not be registered or otherwise recognized in the Corporation’s records or otherwise.
(d) For so long as the transfer restrictions set forth in this Section 5.2.10 2.1 remain in effect, each certificate or option representing a Security subject to such restrictions and owned by any Shareholder, if certificated, will (unless otherwise permitted by the provisions of this Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any 2.1(d)) include one of the following (collectivelylegends, as applicable, in addition to any other legends required by applicable Law or agreement: THE OFFER AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE OFFERED OR SOLD EXCEPT IN COMPLIANCE THEREWITH. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER AND VOTING AS SET FORTH IN A SHAREHOLDERS AGREEMENT, A COPY OF WHICH MAY BE OBTAINED FROM THE CORPORATION. THE OFFER AND SALE OF THIS OPTION AND THE SECURITIES REPRESENTED BY THIS OPTION HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND THIS OPTION AND THE SECURITIES REPRESENTED BY THIS OPTION MAY NOT BE OFFERED OR SOLD EXCEPT IN COMPLIANCE THEREWITH. THIS OPTION AND THE SECURITIES REPRESENTED BY THIS OPTION ARE SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER AND VOTING AS SET FORTH IN A SHAREHOLDERS AGREEMENT, A COPY OF WHICH MAY BE OBTAINED FROM THE CORPORATION. If such Securities are not certificated, a similar notation will be made on the books and records of the Corporation. Any Shareholder may, upon providing evidence, including an opinion of counsel reasonably satisfactory to the Corporation that such Securities either are not “Transfer”): restricted securities” (ias defined in Rule 144) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect interest therein, or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) may be sold pursuant to Leases Rule 144(b)(1), exchange the certificate representing such Securities for a new certificate that does not bear the first sentence of space the applicable legend set forth in this Section 2.1(d) or remove such notation from the Improvements to tenants in accordance with books and records of the Corporation. Upon termination or expiration of the provisions of this Agreement restricting the Transfer and voting of the Securities, any Shareholder may exchange its certificate(s) representing its Securities for a new certificate that does not bear the legend set forth in the second sentence of the applicable legend set forth in this Section 5.1.20, (C2.1(d) the Room License Agreements, and (D) Permitted Transfersor such notation may be removed.
(be) Notwithstanding In order to allow the foregoingShareholders to fulfill any beneficial ownership reporting obligations they may have, if a sale Shareholder acquires or conveyance by Borrower disposes of the Property subject to the lien registered or beneficial ownership (as such term is defined in Rule 13d-3 of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbranceExchange Act) of any direct Securities, such Shareholder shall, within two Business Days following consummation of such acquisition or indirect interests in Borrower is permitted provided that disposition, deliver notice thereof to the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyanceCorporation, which consent the Corporation shall not be unreasonably withheld; provided howeverpromptly, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests and in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time event within two Business Days following receipt of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) ifnotice, after giving effect forward to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loaneach other Shareholder.
Appears in 2 contracts
Sources: Shareholders Agreement (Regional Management Corp.), Shareholders Agreement (Regional Management Corp.)
Transfers. (a) Borrower acknowledges that ▇▇▇▇▇▇ has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Properties in agreeing to make the Loan, and will continue to rely on ▇▇▇▇▇▇▇▇’s ownership of the Properties as a means of maintaining the value of the Properties as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Properties so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by one (1) or more sales of the Properties.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): following: (i) sell, convey, mortgage, grant, bargaingrant a security interest in, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the any Individual Property or any direct part thereof or indirect any legal or beneficial interest therein, or ; (ii) permit a Sale or Pledge of an equity interest in any Restricted Party (clauses (i) and (ii), collectively, a “Transfer”), in each case other than (A) any Transfer otherwise expressly permitted pursuant to this Section 5.2.10, and (B) any Permitted Debt, in each case, provided that the same does not result in a Prohibited Change of Control, unless otherwise expressly approved in writing by ▇▇▇▇▇▇. All Transfers that result in a Person holding a direct or indirect interest in Borrower of 10% or Operating Lesseemore, who did not hold a direct or indirect interest in Borrower of 10% or more as of the Closing Date, shall be subject to the satisfaction of ▇▇▇▇▇▇’s “know-your-customer requirements” with respect to such Person (unless such direct or indirect interests in Borrower are publicly listed or traded on a national securities exchange or other electronic quotation system).
(c) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell one (1) or more Individual Properties or any part thereof for a price to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of any Individual Property for other than actual occupancy by a space Tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, ▇▇▇▇▇▇▇▇’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; and (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of this Section 5.2.10, ▇▇▇▇▇▇’s consent shall not be required in connection with any Permitted Transfer; provided, however, that (A) other than with respect to any Permitted Transfer occurring under clause (n), (o) or (p) of the Operating Leasedefinition thereof, if such transfer results in any Person acquiring more than 49% of the direct or indirect equity interest in any Borrower (even if not constituting a Prohibited Change of Control), Borrower shall have delivered to Lender with respect to such Person an Additional Insolvency Opinion that in Lender’s reasonable judgment satisfies the then-current criteria of the Rating Agencies; (B) pursuant with respect to Leases any Permitted Transfer that results in Borrower ceasing to be both Controlled and owned at least 51% directly or indirectly by Guarantor (and in connection with each subsequent conveyance or transfer that again changes the identity of space any Permitted Transferee that Controls Borrower), the following conditions shall have been satisfied: (1) no Event of Default shall have occurred and be continuing; (2) Borrower shall have delivered to Lender ten (10) days’ prior written notice of such proposed Transfer; (3) Borrower shall have paid of all of Lender’s reasonable and documented fees and expenses incurred in connection with such Transfer, including Rating Agency fees; and (4) Borrower shall have paid to Lender a transfer fee in an amount equal to 0.25% of the Improvements Principal Indebtedness at the time of such conveyance or transfer; and (C) other than with respect to tenants any Permitted Transfer occurring under clause (n), (o) or (p) of the definition thereof, if any Transfer results in a Person holding a direct or indirect interest in Borrower of 10% or more (and such Person did not hold a direct or indirect interest in Borrower of 10% or more as of the Closing Date), such Person must satisfy Lender’s “know-your-customer requirements”, unless such direct or indirect interests in Borrower are publicly listed or traded on a national securities exchange or other electronic quotation system.
(e) Other than the transfer of the Condemnation Parcel in accordance with the provisions terms of Section 5.1.20this Agreement, no direct Transfer of any Individual Property (Cor any direct equity interests in any Individual Borrower) shall occur during the Room License Agreements, and (D) Permitted TransfersBlackout Window.
(bf) Notwithstanding Except during the foregoingBlackout Window, a sale or conveyance by the initial Borrower shall have the right to contemporaneously Transfer all of the Property subject Collateral to the lien a successor borrower that will assume all of the Mortgage (but not any obligations of ▇▇▇▇▇▇▇▇ hereunder and under the other mortgageLoan Documents, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfiedmet to the reasonable satisfaction of ▇▇▇▇▇▇:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Defaultcontinuing;
(ii) the Person to whom the Property is sold or conveyed Lender shall receive thirty (the “Transferee”30) satisfies the requirements days’ prior written notice of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agenciessuch proposed Transfer;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as assumption of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Note, the Mortgage and and/or the other Loan DocumentsDocuments by the proposed successor borrower, subjectand a reaffirmation of each applicable Loan Document by each of Borrower, howeverSole Member and Guarantor (prior to giving effect to such Transfer) as reasonably requested by ▇▇▇▇▇▇, subject to the provisions of Section 9.3 hereof hereof;
(iv) payment of all of reasonable and upon documented fees and expenses incurred in connection with such assumptionTransfer including, Borrower without limitation, the cost of any third party reports, legal fees and expenses, application fees, Rating Agency fees and expenses or required legal opinions;
(v) payment of an assumption fee equal to 0.25% of the Principal Indebtedness at the time of such Transfer;
(vi) delivery of an Additional Insolvency Opinion reflecting the proposed Transfer reasonably satisfactory in form and substance to Lender;
(vii) the proposed successor ▇▇▇▇▇▇▇▇’s continued compliance with the representations and covenants set forth in Section 4.1.9, Section 4.1.30, Section 4.1.35, Section 5.1.23, Section 5.1.24 and Section 5.2.9 hereof;
(viii) delivery of evidence reasonably satisfactory to ▇▇▇▇▇▇ that the proposed successor borrower is a Special Purpose Entity;
(ix) the proposed successor borrower shall be released from all liabilities Controlled and obligations under at least 51% owned by (directly or indirectly) one or more Permitted Transferees, and Lender shall be provided with reasonable evidence thereof;
(x) the proposed successor borrower and its Controlling Permitted Transferee(s) shall not have been the subject of any Bankruptcy Action within seven (7) years prior to the date of the proposed Transfer;
(xi) there shall be no material litigation or regulatory action pending or threatened against the proposed successor borrower or its Controlling Permitted Transferee(s) which would reasonably be expected to materially impair, or does not impair, the proposed transferee’s ability to comply with the terms of the Loan Documents;
(vixii) following such sale neither the proposed successor borrower nor its Controlling Permitted Transferee(s) shall have defaulted under its obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(xiii) prior to any release of Guarantor, a substitute guarantor reasonably acceptable to Lender shall have assumed the Limited Recourse Guaranty and Environmental Indemnity executed by Guarantor or conveyance executed a replacement guaranty and environmental indemnity reasonably satisfactory to Lender and delivered an Additional Insolvency Opinion covering the property manager replacement guarantor; upon assumption of the Property must be Limited Recourse Guaranty and Environmental Indemnity by such substitute guarantor reasonably acceptable to Lender or deliver of an executed a Qualified Manager; andreplacement guaranty and environmental indemnity reasonably satisfactory to Lender by such substitute guarantor and delivery of an Additional Insolvency Opinion covering such substitute guarantor, Lender shall release Guarantor from any matters arising from and after the date of such release;
(viixiv) if required by ▇▇▇▇▇▇, proposed successor borrower and its Controlling Permitted Transferee(s) shall be approved by the Transferee pays Approved Rating Agencies selected by Lender, which approval, if required by ▇▇▇▇▇▇, shall take the form of a Rating Agency Confirmation with respect to Lender a loan the assumption fee of 1% of the then outstanding principal amount of the Loan;
(viiixv) ifdelivery of (i) all organizational documentation reasonably requested by ▇▇▇▇▇▇, after giving effect which shall be reasonably satisfactory to such TransferLender and, Sponsor does not own following a Securitization, satisfactory to the Approved Rating Agencies and (ii) all certificates, agreements and legal opinions reasonably required by ▇▇▇▇▇▇;
(xvi) Lender shall have received, at least 51% no cost or expense to Lender, an endorsement to the Title Insurance Policy, as modified by the assumption agreement, as a valid first lien on the Properties and naming the proposed successor borrower as owner of the equity interests in Borrower and control BorrowerProperties, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Rating Agencies have confirmed that such sale Properties shall not be subject to any additional exceptions or conveyanceliens other than those contained in the Title Insurance Policy issued on the date hereof, the Permitted Encumbrances and Liens being contested in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securitiesaccordance with this Agreement; and
(ixxvii) Borrower pays Lender’s reasonable costs and expenses (including such other conditions as may be required for Lender to comply with its own internal policies as of the date of such Transfer, including, without limitation, any fees due policies with respect to the Rating Agencies) in connection with creditworthiness, reputation and qualifications of the sale proposed successor borrower or conveyanceits Controlling Permitted Transferee(s).
(cg) A Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon a Transfer that requires ▇▇▇▇▇▇’s consent hereunder and which consent has not been obtained prior to such Transfer. This provision shall apply to every Transfer that requires ▇▇▇▇▇▇’s consent hereunder regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer that requires ▇▇▇▇▇▇’s consent.
(but not h) Except for a pledgePermitted Transfer or as otherwise expressly permitted hereunder, hypothecation, creation of a security no direct or indirect equity interest in or other encumbrance) right to distributions from Borrower shall be subject to a Lien in favor of any Person, and neither Borrower nor any holder of a direct or indirect interest in Borrower shall issue preferred equity (or debt granting the holder thereof rights substantially similar to those generally associated with preferred equity); provided, however, that, notwithstanding anything to the contrary herein, the following shall be permitted without the consent of Lender: (A) a Lien permitted as a Permitted Transfer, (B) any Lien on direct or indirect equity interests in Borrower and/or rights to distributions from Guarantor or any Person owning a direct or indirect interest in Guarantor and (C) the issuance of direct or indirect preferred equity interests in Guarantor or any Person owning a direct or indirect interest in Guarantor. To the extent a transaction is permitted under the definition of Permitted Transfer or clause (f) above, such transaction shall for all purposes be deemed permitted, notwithstanding that another clause may otherwise limit such transaction, provided that any requirements and/or conditions expressly set forth in the following conditions definition of Permitted Transfer or clause (f) above are satisfied:satisfied and no Event of Default is continuing.
(i) if such sale Notwithstanding anything contained herein or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect in any other Loan Document to the Transfercontrary, Sponsor owns not less than 51% so long as Lineage Logistics Holdings, LLC is a Guarantor under the Loan, Lineage Logistics Holdings, LLC shall, subject to the MT Enforcement Rights, (A) continue to own (beneficially and of the equity interests in Borrower and controls, directly or indirectly, Borrower;
record) one hundred percent (ii100%) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership equity interests in each Master Tenant and (B) cause each Master Tenant, any subtenant of any Master Tenant and/or any Taxable REIT Subsidiary to continue to engage in the businesses conducted by such Master Tenant as of the Closing Date, in each case of clauses (A) and (B), unless Lender shall otherwise consent (not to be unreasonably withheld, conditioned or delayed). Borrower and ▇▇▇▇▇▇ hereby acknowledge and agree that any breach or violation of this Section 5.2.10(i) shall be transferred (and shall be deemed and construed to be) (x) a Person individually Prohibited Change of Control and (y) a prohibited Transfer. For the avoidance of doubt, (i) to the extent an exercise of the MT Enforcement Rights by one or together with its Affiliates not owning at least 49% more of the MT Secured Lenders results in the foreclosure or transfer in lieu of foreclosure of the direct or indirect ownership equity interests in Borrower immediately prior to such Transfer (any Master Tenant, any subtenant of any Master Tenant or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lenderany Taxable REIT Subsidiary, the Rating Agencies same shall not be deemed or construed to be a breach or violation of the requirement described in this paragraph or a Prohibited Change of Control or a prohibited Transfer, and their respective counsel(ii) upon the occurrence of any such foreclosure or transfer in lieu of foreclosure, successors the provisions described in this paragraph will automatically terminate and assigns, have no further force and effect with respect to any Person that is the proposed subject of any such foreclosure or transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time in lieu of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanforeclosure.
Appears in 2 contracts
Sources: Loan Agreement (Lineage, Inc.), Loan Agreement (Lineage, Inc.)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners, as applicable, in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) permit a Sale or Pledge of a direct or indirect any interest in Borrower any Restricted Party (any of the actions in the foregoing clauses (i) or Operating Lessee(ii), a “Transfer”), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 hereof and (DB) Permitted Transfers.
(bc) Notwithstanding A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the foregoingProperty, or any part thereof, for a sale or conveyance price to be paid in installments; (ii) an agreement by Borrower leasing all or substantially all of the Property for other than actual occupancy by a space tenant thereunder, or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(d) Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon a Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer.
(e) There shall be no assumption of the Loan during the period that is thirty (30) days prior to and continuing until thirty (30) days following the Securitization of any portion of the Loan. Other than as set forth in the preceding sentence, Borrower shall have the right to unlimited Transfers of the Property with Lender’s consent, not to be unreasonably withheld, provided no Event of Default has occurred and is continuing, and Lender receives thirty (30) days’ prior written notice of such Transfer and a non-refundable application fee of $5,000 at the time Lender’s consent is sought, and further provided that the following additional requirements are satisfied:
(i) Borrower shall pay Lender a transfer fee equal to one percent (1%) of the Outstanding Principal Balance upon completion of such Transfer;
(ii) Borrower shall pay any and all reasonable out-of-pocket costs incurred in connection with such Transfer (including, without limitation, Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Approved Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or Transferee’s Principals must have the creditworthiness, reputation and qualifications to Lender’s reasonable satisfaction;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate Net Worth and Liquid Assets reasonably acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not reasonably acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 5.2.9, 5.2.12 and 5.2.13 hereof, no Default or Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements and covenants reasonably required by Lender;
(x) Each Approved Rating Agency shall have issued a Rating Agency Confirmation with respect to such Transfer;
(xi) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion reflecting such Transfer satisfactory in form and substance to Lender and each Approved Rating Agency;
(xii) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and the Environmental Indemnity or shall execute a replacement guaranty and environmental indemnity in form and substance reasonably satisfactory to Lender;
(xiii) Borrower shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policy, as modified by the assumption agreement, as a valid first lien on the Property and naming the Transferee as owner of the Property, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Property shall not be subject to the lien of the Mortgage (but not any other mortgage, lien additional exceptions or other encumbrance (liens other than those contained in the Title Insurance Policy issued on the date hereof and the Permitted Encumbrances and Room License Agreements hereafter entered into such other matters permitted under the terms of this Agreement or otherwise approved by Lender in writing;
(xiv) The Property shall be managed by a Qualified Manager pursuant to a Replacement Management Agreement; and
(xv) Immediately upon a Transfer to such Transferee and the ordinary course satisfaction of operating all of the Propertyabove requirements, the named Borrower and Guarantor herein shall be released from all liability under this Agreement, the Note, the Security Instrument and the other Loan Documents accruing after such Transfer. The foregoing release shall be effective upon the date of such Transfer, but Lender agrees to provide written evidence thereof reasonably requested by Borrower.
(f) From and after the four (4) month anniversary of the Closing Date, in addition to the Transfers of the Property contemplated by the preceding clause (e) the initial Borrower shall have the right to contemporaneously Transfer all of the Property to a Successor Borrower that will assume all of the obligations of Borrower hereunder and under the other Loan Documents (an “Affiliate Assumption”), provided no Event of Default or monetary Default is then continuing or would result therefrom and the following conditions are met to the reasonable satisfaction of Lender:
(i) such Successor Borrower shall have executed and delivered to Lender an assumption agreement (including an assumption of the Security Instrument in recordable form, if requested by Lender), in form and substance reasonably acceptable to Lender, evidencing its agreement to abide and be bound by the terms of the Loan Documents and containing representations substantially equivalent to those contained in Article IV (REPRESENTATIONS AND WARRANTIES) (recast, as necessary, such that representations that specifically relate to Closing Date are remade as of the date of such assumption), and such other representations (and evidence of the accuracy of such representations) as Lender shall reasonably request;
(ii) such Uniform Commercial Code financing statements as may be reasonably requested by Lender shall be filed;
(iii) a Person satisfactory to Lender in its sole discretion assumes all obligations, liabilities, guarantees and indemnities of Key Principal and any other guarantor under the Loan Documents pursuant to documentation satisfactory to Lender (and upon such assumption by such Person, Key Principal and any other such guarantor shall be released from such obligations, liabilities, guarantees and indemnities);
(iv) such Successor Borrower shall have delivered to Lender legal opinions of counsel reasonably acceptable to Lender that are equivalent to the opinions delivered to Lender on the Closing Date; and Borrower and the Successor Borrower shall have delivered such other documents, certificates and legal opinions, including relating to REMIC matters, as Lender shall reasonably request;
(v) such Successor Borrower shall have delivered to Lender all documents reasonably requested by it relating to the existence of such Successor Borrower and the due authorization of the Successor Borrower to assume the Loan and to execute and deliver the documents described in this Section, each in form and substance reasonably satisfactory to Lender, including a certified copy of the applicable resolutions from all appropriate persons, certified copies of the organizational documents of the Successor Borrower, together with all amendments thereto, and certificates of good standing or existence for the Successor Borrower issued as of a recent date by its state of organization and each other state where such entity, by the nature of its business, is required to qualify or register;
(vi) the Title Insurance Policy shall have been properly endorsed to reflect the Transfer of the Property to the Successor Borrower;
(vii) the Rating Condition shall have been satisfied;
(viii) the proposed Qualified Equityholders must have the creditworthiness, reputation and qualifications to Lender’s reasonable satisfaction;
(ix) Successor Borrower and each Qualified Equityholder shall, as of the date of such transfer, have an aggregate Net Worth and Liquid Assets reasonably acceptable to Lender;
(x) Successor Borrower, each Qualified Equityholder and all other entities which may be owned or Controlled directly or indirectly by each Qualified Equityholder (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(xi) There shall be no material litigation or regulatory action pending or threatened against Successor Borrower, each Qualified Equityholder or Related Entities which is not reasonably acceptable to Lender;
(xii) Successor Borrower, each Qualified Equityholder and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(xiii) The Property shall be managed by Manager pursuant to the Management Agreement or by a Qualified Manager pursuant to a Replacement Management Agreement; and
(xiv) If the Successor Borrower is a Person described in clause (ii) or (iii) of paragraph 2 of the definition of Qualified Equityholder, Borrower shall have paid to Lender a nonrefundable assumption fee in an amount equal to $5,000, and Borrower shall have reimbursed Lender for all reasonable out-of-pocket costs and expenses incurred in connection with such Affiliate Assumption (including, without limitation, Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of satisfying the Rating Condition pursuant to clause (vii) above.
(g) No direct or indirect equity interests in Borrower (other than as permitted provided that in clause (h)(i) below) shall be conveyed or otherwise transferred to any Person, unless the following conditions are satisfied:
(i) no Event of Default or monetary Default shall have occurred and be continuing and at the time of such sale conveyance or conveyance shall not result in an Event of Defaulttransfer;
(ii) the Person to whom the Property is sold no Prohibited Change of Control or conveyed (the “Transferee”) satisfies the requirements of Prohibited Pledge shall occur as a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agenciesresult thereof;
(iii) if any such sale conveyance or transfer results in Borrower ceasing to be Controlled by Key Principal (and in connection with each subsequent conveyance occurs prior to a Securitizationor transfer that again changes the identity of the Qualified Equityholder that Controls Borrower), Lender Borrower shall have consented paid to Lender a transfer fee in an amount equal to 0.5% of the Outstanding Principal Balance at the time of such sale conveyance or conveyance, which consent shall not be unreasonably withheldtransfer;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agenciesintentionally omitted;
(v) Borrower shall have paid the Transferee shall execute an assumption, effective as costs and expenses (if any) of the date of Rating Agencies and Servicers and reimbursed Lender for its reasonable out-of-pocket costs and expenses incurred in connection with any such conveyance or transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following no such sale sales or conveyance the property manager of the Property must transfers shall be a Qualified Manager; andto an Embargoed Person;
(vii) to the Transferee pays to Lender a loan assumption fee of 1% extent such transferee owns ten percent (10%) or more of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the such Restricted Party immediately following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer (provided such transferee did not own 10% or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% as of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to LenderClosing Date), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lenderdeliver, the Rating Agencies at Borrower’s sole cost and their respective counselexpense, successors and assignscustomary searches (credit, judgment, lien, etc.) with respect to the proposed transfer or saleeach such transferee, which Additional Insolvency Opinion such search results shall be reasonably acceptable to Lender and, after a Securitization, the Rating AgenciesLender;
(iiiviii) at either (a) the time management of such Transfer no Event the Property remains unchanged or (b) a replacement manager is appointed pursuant to Section 5.1.22 of Default has occurred and is continuingthis Agreement;
(ivix) following such Transfer the property manager Borrower shall continue to comply with the terms of the Property must be a Qualified Manager;
(v) if, Section 4.1.30 hereof after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (Ax) Lender shall have consented received thirty (30) days advance written notice of such conveyance or transfer.
(h) Notwithstanding anything to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of contrary contained in the Loan.Loan Do
Appears in 2 contracts
Sources: Loan Agreement (Inland Diversified Real Estate Trust, Inc.), Loan Agreement (Inland Diversified Real Estate Trust, Inc.)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.9 or in connection with the release of any Individual Property in accordance with this Agreement, Borrower shall not, not and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options to purchase with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) enter into, or permit the Property to be subject to, any PACE Debt, (iii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than than, in each case, (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.205.1.18 and customary occupancy agreements with short-term hotel guests, and (B) Permitted Transfers and Permitted Indebtedness, or (iv) Borrower dividing into two or more separate and distinct entities.
(c) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell any Individual Property or any part thereof for a price to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of any Individual Property for other than actual occupancy by a space Tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non managing membership interests or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of this Section 5.2.9, the following Transfers shall not require the consent of Lender or the payment of any transfer fee:
(i) The Sale or Pledge, in one or a series of transactions, of the direct or indirect equity interests in Borrower or direct or indirect interests in any Restricted Party (excluding the direct interests in Borrower or Mezzanine Borrower, other than, for the avoidance of doubt, a Permitted Transfer set forth in clause (m) of the definition of “Permitted Transfer”); provided, that, (A) after giving effect to such Sale or Pledge (and in the case of a Sale or Pledge that is a pledge for security purposes, any subsequent foreclosure thereon), (x)
(1) Borrower and Principal (on an unencumbered and look through basis) are indirectly Controlled and at least 50.1% owned by ▇▇▇▇▇ OP and/or MGP OP, provided that (I) with respect to ▇▇▇▇▇ OP, ▇▇▇▇▇ OP is owned, managed or Controlled by ▇▇▇▇▇, a Qualified Advisor, a Qualified Transferee or a Public Vehicle and (II) with respect to MGP OP, MGP OP is managed and Controlled by MGP, a Public Vehicle or a Qualified Transferee, or (y) following a Public Sale, a Public Vehicle or, following a Permitted Assumption, the applicable Qualified Transferee (1) shall own not less than fifty-one percent (51%) of the economic and direct or indirect legal and beneficial interests in Borrower, Guarantor and Principal (on an unencumbered and look through basis) and (2) Control Borrower, Guarantor and Principal, (B) upon the written request of Lender, Borrower shall deliver to Lender notice of each sale described in this Section 5.2.9(d)(i) not less than ten (10) days following such request, (C) no Sale or Pledge of any direct interest in any Borrower, Mezzanine Borrower or Principal shall be permitted (other than, for the Room License Agreementsavoidance of doubt, a Permitted Transfer set forth in clause (m) of the definition of “Permitted Transfer”), (D) no Individual Borrower or Principal shall fail to be a Special Purpose Entity by reason of such Sale or Pledge, (E) for so long as the Loan shall remain outstanding (I) no pledge of any direct interests in any Restricted Pledge Party shall be permitted (other than pledges securing the Loan) and except that a pledge of the direct ownership interests in the most upper tier Restricted Pledge Party shall be permitted (other than pledges securing the Loan or Mezzanine Loan) if such pledge directly or indirectly secures indebtedness that is also directly or indirectly secured by substantial assets other than the Property and (II) no Restricted Pledge Party shall issue preferred equity that has the characteristics of mezzanine debt (such as a fixed maturity date, pledged ownership interests as security, regular payments of interest, a fixed rate of return and rights of the equity holder to demand repayment of its investment), and (DF) Permitted Transferswith respect to any transferee that, as a result of such transfer, will hold a twenty percent (20%) or greater direct or indirect interest in, or control, Borrower and/or Principal (and such transferee owned less than twenty percent (20%) of the direct or indirect interest in Borrower and/or Principal or did not control Borrower and/or Principal on the Closing Date), Lender shall receive satisfactory “know your customer” compliance screening searches consisting of a search and evaluation of (x) OFAC sanctions and other government required sanctions lists, (y) negative news screening of such holders, if any, associated with material derogatory information that could reasonably result in anti-money laundering risk to Lender related to terrorist or other financial crimes and (z) such statutes and other information reasonably required by Lender to confirm that Borrower and/or Principal, and such transferee is not an Embargoed Person (Lender agrees to use diligent and commercially reasonable efforts to complete such “know your customer” diligence in accordance with this clause (F) within fifteen (15) Business Days after Lender receives the requested information necessary to conduct such diligence). If after giving effect to any such Sale or Pledge, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion reasonably acceptable to Lender and the Approved Rating Agencies. Notwithstanding anything to the contrary contained in this Agreement, (x) no notice to, or consent of, Lender shall be required in connection with any Sale or Pledge of direct or indirect interests in any Excluded Entity or by and among any Excluded Entity and (y) no Restricted Pledge Party (other than Borrower, Mezzanine Borrower or Principal) shall be restricted from any Sale or Pledge of its direct or indirect assets; provided such assets are not encumbered (or required to be encumbered) by the Loan or the Mezzanine Loan. In connection with a Sale or Pledge resulting in Guarantor no longer owning direct or indirect interests in Borrower, Principal or the Property, Guarantor shall be released as a guarantor under (I) the Guaranty for any acts occurring after such Sale or Pledge; provided that Borrower delivers a Substitute Guaranty from a Qualified Transferee that Controls Borrower or is under common Control with Borrower, which Substitute Guaranty shall include all liability for all such acts for which Guarantor was so released and (II) the Excess Cash Flow Guaranty, if any, provided that Borrower shall pay to Lender an amount equal to the Guaranteed Excess Cash Flow as of such date, which amounts shall be deposited by Lender into the Excess Cash Flow Reserve Account.
(bii) Notwithstanding A Public Sale, provided, that (A) if after giving effect to any such Public Sale, more than forty-nine percent (49%) in the foregoingaggregate of the direct or indirect interests in any Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) of the direct or indirect interest in such Restricted Party as of the Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion reasonably acceptable to Lender and, to the extent a rated Securitization has occurred, the Approved Rating Agencies; (B) none of Borrower or Principal shall fail to be a Special Purpose Entity by reason of such sale, (C) no Transfer of any direct interest in Borrower or Principal, or for so long as the Mezzanine Loan remains outstanding, in the Mezzanine Borrower shall be permitted, (D) no Restricted Pledge Party shall issue preferred equity that has the characteristics of mezzanine debt (such as a fixed maturity date, pledged ownership interests as security, regular payments of interest, a sale or conveyance by Borrower fixed rate of return and rights of the equity holder to demand repayment of its investment), (E) with respect to any transferee that, as a result of such transfer, will hold a twenty percent (20%) or greater direct or indirect interest in, or control, Borrower and/or Principal, (and such transferee owned less than twenty percent (20%) of the direct or indirect interest in Borrower and/or Principal, or did not control Borrower and/or Principal, on the Closing Date), Lender shall receive satisfactory “know your customer” compliance screening searches consisting of a search and evaluation of (x) OFAC sanctions and other government required sanctions lists, (y) negative news screening of such holders, if any, associated with material derogatory information that could reasonably result in anti-money laundering risk to Lender related to terrorist or other financial crimes and (z) such statutes and other information reasonably required by Lender to confirm that Borrower and/or Principal, and such transferee is not an Embargoed Person (Lender agrees to use diligent and commercially reasonable efforts to complete such “know your customer” diligence in accordance with this clause (E) within fifteen (15) Business Days after Lender receives the requested information necessary to conduct such diligence), and (F) for so long as the Property is subject to the lien MGM/Mandalay Lease, any such Transfer shall comply with the terms and conditions of the Mortgage MGM/Mandalay Lease and, to the extent the consent of MGM/Mandalay Tenant is required thereunder, Lender shall have been provided evidence of such consent. Upon completion of any such Public Sale subject to and in accordance with the provisions of this Section 5.2.9(d)(ii), Guarantor shall be released as a guarantor under (I) the Guaranty for any acts occurring from and after such Public Sale; provided that Borrower delivers to Lender (x) a Substitute Guaranty for obligations and liabilities under the Guaranty occurring from and after such Public Sale from (1) a Replacement Guarantor or (2) a Public Vehicle that Controls Borrower or is under common Control with Borrower and (y) the organizational documents of such replacement guarantor, resolutions authorizing such replacement guarantor to enter into either the assumption of the Guaranty or the Substitute Guaranty and an enforceability and execution opinion covering the enforceability of such assumption of the Guaranty or the Substitute Guaranty against such replacement guarantor in the same form and substance as the enforceability opinion delivered to Lender on the Closing Date (or in such other form as reasonably approved by Lender) and (II) the Excess Cash Flow Guaranty, if any, provided that Borrower shall pay to Lender an amount equal to the Guaranteed Excess Cash Flow as of such date, which amounts shall be deposited by Lender into the Excess Cash Flow Reserve Fund. Following any Transfer in accordance with this Section 5.2.9(d)(ii), the Public Vehicle shall be deemed to be an Excluded Entity. For purposes of clarity, the provisions of Section 5.2.3 and this Section 5.2.9 shall not restrict the Public Vehicle (or any direct or indirect owner of the Public Vehicle, but excluding any Borrower and Mezzanine Borrower) from effectuating a restructuring and such Public Vehicle (or any direct or indirect owner of the Public Vehicle, but excluding any Borrower or Mezzanine Borrower) shall be permitted to effectuate a restructuring, including amending or modifying its organizational documents or commercial arrangements including any amendments or modifications reasonably determined by such Public Vehicle to be required to satisfy stock exchange, quotation system listing or trading requirements. Notwithstanding anything to the contrary contained herein, Lender’s receipt of a Rating Agency Confirmation shall not be required in connection with a Public Sale.
(iii) Any pledge made by Mezzanine Borrower to secure the Mezzanine Loan or any other mortgagemezzanine loan created in accordance with the terms of this Agreement, lien in accordance with the Mezzanine Loan Documents or other encumbrance any Foreclosure.
(other than e) In the Permitted Encumbrances and Room event that any Gaming Authority requires Borrower or its direct or indirect owner to apply for a Gaming License Agreements hereafter entered into in the ordinary course connection with its ownership of operating the Property), Borrower may, without Lender’s consent, implement a “voteco” structure which would result in (A) is permitted one hundred percent of the voting membership interests in Borrower (or a direct or indirect owner of Borrower) being owned by a Voteco Entity, (B) Voteco Entity thereafter Controlling Borrower, and (C) the direct or indirect economic interests in Borrower continuing to be owned in accordance with the requirements of this Agreement and the other Loan Documents provided that the following conditions are satisfied:
(i1) no No Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Defaultcontinuing;
(ii2) Borrower shall provide Lender with no less than thirty (30) days prior written notice of the Person to whom the Property is sold or conveyed (implementation of such “voteco” structure, which notice shall include organizational charts that reflect the “Transferee”voteco” structure of Borrower both prior to and subsequent to the implementation of such “voteco” structure;
(3) satisfies the requirements Borrower shall deliver to Lender copies of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender andVoteco Entity filed with the appropriate office in the applicable state of formation, after a Securitization, together with any authorizing resolutions and amendments to the Rating Agenciesorganizational documents of Borrower or its direct or indirect owners to effectuate the “voteco” structure;
(iii4) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors new enforceability and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.corporate opi
Appears in 1 contract
Sources: Loan Agreement (MGM Growth Properties Operating Partnership LP)
Transfers. (a) Each Borrower acknowledges that each of the Agent and the Lender has examined and relied on the experience of such Borrower and its general partners, members and (if such Borrower is a trust) beneficial owners, as applicable, in owning and operating properties such as the Properties in agreeing to make the Loan, and will continue to rely on the ownership of the Properties by the Borrowers as a means of maintaining the value of the Properties as security for repayment of the Debt and the performance of the Other Obligations. Each Borrower acknowledges that each of the Agent and the Lender has a valid interest in maintaining the value of the Properties so as to ensure that, should any Borrower default in the repayment of the Debt or the performance of the Other Obligations, the Lender can recover the Debt by a sale of one or more of the Properties.
(b) Without the prior written consent of Lender, the Agent and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, no Borrower shall not, and shall not cause or permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) assign, lease, sublease, license, sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the any Property or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) permit a Sale or Pledge of a any direct or indirect interest in Borrower any Property or Operating Lesseein any Restricted Party (collectively, a “Transfer”), other than (A) the Operating Lease, (Bx) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20the Loan Documents, (Cy) the Room License Agreements, disposition of Equipment and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the other Personal Property subject pursuant to the lien replacement thereof with similar property of the Mortgage (but not any other mortgage, lien equal or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into better quality in the ordinary course of operating the operation of any Property and (z) the security interests created by the Loan Documents (collectively, “Permitted Transfers”).
(c) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein any Borrower agrees to sell any Property), or any part thereof, for a price to be paid in installments; (ii) an agreement by any Borrower leasing all or substantially all of any Property for other than actual occupancy by a space tenant thereunder, or a sale, assignment or other transfer of, or the grant of a security interest in, any Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is permitted provided that a corporation, any merger, consolidation or direct or indirect Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the direct or indirect Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the direct or indirect Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the direct or indirect Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the other provisions of this Section 5.2.10, the Agent’s consent shall not be required for or in connection with the following conditions are satisfiedTransfers:
(i) no Event if the REIT Guarantor’s shares of Default common equity are listed for trading on The New York Stock Exchange or another nationally or internationally recognized securities exchange, Transfer of publicly traded shares of the REIT Guarantor on any such exchange, so long as such Transfer does not result in a Change of Control; and
(ii) any Transfer of limited partnership interests in the OP Guarantor, provided that, (A) if such Transfer meets or exceeds the Transfer Notice Threshold, the Agent shall have occurred receive not less than twenty (20) days’ prior written notice of such Transfer and the Agent shall be continuing in receipt of Satisfactory Search Results prior to such Transfer, at the Borrowers’ cost and expense, (B) such sale or conveyance Transfer shall not result in an Event a Change of Default;
Control, (iiC) all applicable net worth and liquidity covenants set forth in the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements Guaranty of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, Recourse Obligations with respect to the Transferee any Guarantor shall remain satisfied after such Transfer and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(vD) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, if after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
more than forty-nine percent (ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies49%) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation aggregate of a security interest in or other encumbrance) of any direct or indirect interests in any Borrower is permitted provided or any Principal are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Borrower or such Principal (as applicable) as of the following conditions are satisfied:Closing Date, the Borrowers shall, no less than thirty (30) days prior to the effective date of such Transfer, deliver to the Agent an Additional Insolvency Opinion.
(ie) if Each Borrower acknowledges and agrees that any Transfer of development rights, grant of an easement, or recordation of a zoning lot development agreement (ZLDA) or declaration of zoning lot restrictions or restrictive declaration in respect of any Property hereafter granted or otherwise consummated shall constitute a Transfer of such sale or conveyance occurs prior to a Securitization, Property.
(f) Neither the Agent nor the Lender shall have be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Obligations immediately due and payable upon a Transfer not permitted hereunder without the Agent’s consent. This provision shall apply to every Transfer not permitted hereunder without the Agent’s consent regardless of whether voluntary or not, or whether or not the Agent has consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the any previous Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;.
(iig) if The Borrowers shall pay or cause to be paid any transfer taxes incurred as a result of any such Transfer or series permitted hereunder and shall provide evidence of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to any required payment as a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect condition to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time consummation of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanor otherwise permitted hereunder.
Appears in 1 contract
Transfers. (a) Without Unless such action is permitted by the prior written consent provisions of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.13, Borrower shall notagrees that it will not (i) sell, and shall not assign, convey, transfer or otherwise dispose of its interests in the Property or any part thereof, (ii) permit any Person owning a direct owner, directly or indirect indirectly, of an ownership interest in the Property, to transfer such interest, whether by transfer of stock or other interest in Borrower or Operating Lessee any entity, or otherwise, (iii) incur Indebtedness (other than the Indebtedness permitted pursuant to the terms of this Agreement), (iv) mortgage, hypothecate or otherwise encumber or grant a security interest in the Property or any part thereof, (v) sell, assign, convey, transfer, mortgage, encumber, grant a security interest in, or otherwise dispose of any direct or indirect ownership interest in Borrower, or permit any owner of an interest in Borrower to do the same, or (vi) file a declaration of condominium with respect to the Property (any of the following (collectivelyforegoing transactions, a “Transfer”): ). For purposes hereof, a “Transfer” shall not include (iA) sellany issuance, conveysale or transfer of interests in Sole Member or any successor entity resulting from any merger permitted hereunder, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, (B) a transfer by devise or otherwise transfer descent or dispose of (voluntarily or involuntarily, by operation of law upon the death of a member or otherwise, and whether or not for consideration or partner of record) the Property or any direct or indirect interest thereinBorrower, or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreementsmerger of the Sole Member with any of the following entities: Inland Retail Real Estate Trust, Inc., a Maryland corporation, Inland Real Estate Corporation, a Maryland corporation, Inland Real Estate Investment Corporation, a Delaware corporation, Inland Western Retail Real Estate Trust, Inc., a Maryland corporation, any other real estate investment trust sponsored by Inland Real Estate Investment Corporation, or any other entity composed entirely of any of the foregoing by merger; provided, however, Lender shall receive not less than thirty (30) days prior written notice of such proposed transfer and, in connection with a merger hereinabove described, the net worth of the entity surviving the merger shall not be less than the net worth of the Sole Member immediately prior to such merger and (D) Permitted Transfersthe entity surviving the merger shall be publicly traded.
(ba) Notwithstanding On and after the foregoingClosing Date, Lender shall not withhold its consent to a sale or conveyance by Borrower Transfer of the Property subject to the lien Property, as part of the Mortgage (but not any other mortgagea single transaction, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i1) the transferee of the Property shall be a Special Purpose Entity (the “Transferee”) which at the time of such transfer will be in compliance with the covenants contained in Section 5.1.1 and the representations contained in 4.1.30 hereof and which shall have assumed in writing (subject to the terms of Section 9.4 hereof) and agreed to comply with all the terms, covenants and conditions set forth in this Loan Agreement and the other Loan Documents, expressly including the covenants contained in Section 5.1.1 and the representations contained in 4.1.30 hereof;
(2) if requested by Lender, Borrower shall deliver confirmation in writing from the Rating Agencies that such proposed Transfer will not cause a downgrading, withdrawal or qualification of the then current rating of any securities issued pursuant to such Securitization;
(3) if Manager does not act as manager of the transferred Property then the manager of the Property must be a Qualifying Manager;
(4) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Defaultcontinuing;
(ii5) the Person to whom the Property is sold if required or conveyed (the “Transferee”) satisfies the requirements requested by any of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender Borrower shall have consented caused counsel to such sale or conveyance, render a substantive non-consolidation opinion which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which in each case may be relied upon by Lenderthe holder of the Note, the Rating Ratings Agencies and their respective successors counsel, agents and assigns, representatives with respect to the Transferee and its applicable affiliatesproposed transaction, including the Transferee, which Additional Insolvency Opinion opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agenciesin its reasonable discretion;
(v6) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
have paid (viA) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan an assumption fee of 1% equal to one percent (1.0%) of the then outstanding principal amount balance of the Loan, and (B) the reasonable and customary third-party expenses (including reasonable attorneys’ fees and disbursements) actually incurred by Lender in connection with such Transfer; provided, however,
(A) no assumption fee shall be required for a Transfer of the Property to a Transferee acceptable to Lender in connection with a joint venture between Sole Member and an entity acceptable to Lender, provided Sole Member or an Affiliate wholly-owned (directly or indirectly) by Sole Member owns at least ten percent (10%) of the ownership interests in such Transferee and for which Sole Member or an Affiliate wholly owned (directly or indirectly) by Sole Member, is the managing entity and otherwise maintains operational and managerial control of such Transferee, and Inland American Real Estate Trust, Inc. remains as Indemnitor, provided that, Borrower shall pay all of Lender’s reasonable and customary third-party expenses (including reasonable attorneys’ fees and disbursements) actually incurred by Lender in connection with such Transfer and a processing fee of $5,000, and
(B) for a Transfer as described in clause (6)(A) immediately above, except solely that such Transfer results in Inland American Real Estate Trust, Inc. or an Affiliate wholly-owned (directly or indirectly) by Inland American Real Estate Trust, Inc., owing less than ten (10%) percent and not less than one (1%) percent of the ownership interests in such Transferee, the assumption fee payable shall be $15,000.00;
(viii7) ifthe proposed Transfer is not requested during, after giving effect and shall not occur during a Transfer Restriction Period. Lender shall approve or disapprove any proposed Transfer governed by this Section 5.2.13(a) within thirty (30) days of Lender’s receipt of a written notice from Borrower requesting Lender’s approval, provided such notice includes all information necessary to make such Transferdecision, Sponsor and further provided that such written notice from Borrower shall conspicuously state, in large bold type, that “PURSUANT TO SECTION 5.2.13 OF THE LOAN AGREEMENT, A RESPONSE IS REQUIRED WITHIN THIRTY (30) DAYS OF LENDER’S RECEIPT OF THIS WRITTEN NOTICE.” If Lender fails to disapprove any such matter within such period, Borrower shall provide a second written notice requesting approval, which written notice shall conspicuously state, in large bold type, that “PURSUANT TO SECTION 5.2.13 OF THE LOAN AGREEMENT, THE MATTER DESCRIBED HEREIN SHALL BE DEEMED APPROVED IF LENDER DOES NOT RESPOND TO THE CONTRARY WITHIN TEN (10) DAYS OF LENDER’S RECEIPT OF THIS WRITTEN NOTICE.” Thereafter, if Lender does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that disapprove such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
matter within said ten (ix10) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyanceday period such matter shall be deemed approved.
(cb) A On and after the Closing Date, and provided the proposed transfer is not requested during, and shall not occur during, a Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a SecuritizationRestriction Period, Lender shall have consented to such sale or conveyancenot withhold its consent to, which consent and shall not be unreasonably withheld; provided howevercharge an assumption fee in connection with, Lender’s consent shall not be required if(1) a Transfer of up to, after giving effect to in the Transferaggregate, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
forty-nine percent (ii49%) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to Borrower, or (2) a Person individually or together with its Affiliates not owning at least Transfer of greater than forty-nine percent (49% %) of the direct or indirect ownership interests interest in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed provided that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented such transfer is to such Transfer a Qualified Entity (as defined below), and (B) Borrower shall pay to all of Lender’s reasonable and customary third-party expenses (including reasonable attorneys’ fees and disbursements) actually incurred by Lender in connection with such Transfer and a loan assumption processing fee of 1$5,000. For purposes of this Agreement, a “Qualified Entity” shall mean an entity (x) with a net worth of $200,000,000 or more, (y) with sufficient experience (determined by Lender in its reasonable discretion) in the ownership and management of properties similar to the Property, and (z) which owns or manages retail properties containing at least 1,000,000 square feet of gross leasable area. If required or requested by any of the Rating Agencies, Borrower shall deliver a substantive non-consolidation opinion with respect to any party not now owning more than 49% of the then outstanding principal amount ownership interests in Borrower acquiring more than 49% of the Loanownership interests in Borrower.
Appears in 1 contract
Sources: Loan Agreement (Inland American Real Estate Trust, Inc.)
Transfers. (a) Without Borrower acknowledges that Lender has examined and relied on the experience of Borrower, Guarantor and Sun in owning and operating properties such as any Individual Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of any Individual Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of any Individual Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of any Individual Property.
(b) Except for Permitted Transfers, Alternative Permitted Transfers described in Section 5.2.10(d) and a sale of the Property to the extent permitted under Section 5.2.10(e), without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20. For the avoidance of doubt, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable prior notice to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which and Lender’s consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such required for any Permitted Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock, although Permitted Transfers thereof are not restricted; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests, although Permitted Transfers thereof are not restricted; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests, although Permitted Transfers thereof are not restricted; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions creation or issuance of new legal or beneficial interests, although Permitted Transfers thereof are satisfied:not restricted; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(id) if such sale In addition to Permitted Transfers which do not require notice to, or conveyance occurs prior to a Securitizationthe consent of, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverLender, Lender’s consent shall not be required ifin connection with one or a series of Transfers, of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party (an “Alternative Permitted Transfer”); provided, however, no such Alternative Permitted Transfer which does not otherwise qualify as a Permitted Transfer shall result in the change of Control in a Restricted Party, and as a condition to each such Alternative Permitted Transfer which does not otherwise qualify as a Permitted Transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed Alternative Permitted Transfer. If after giving effect to the any such Alternative Permitted Transfer which does not otherwise qualify as a Permitted Transfer, Sponsor owns not more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than 51% forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the equity interests in Closing Date, Borrower and controlsshall, directly or indirectly, Borrower;
no less than thirty (ii30) if as a result days prior to the effective date of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Alternative Permitted Transfer, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and the Rating Agencies. Anything contained herein to the contrary notwithstanding, at all times, (i) Guarantor must continue to own, directly or indirectly, at least a 99.5% legal and beneficial interest in each Individual Borrower and (ii) Sun must continue to Control Guarantor, each Principal and each Individual Borrower (through its ownership of each Principal), and own, directly or indirectly, at least a 51% legal and beneficial interest in Guarantor and a 100% legal and beneficial interest in each Principal. For the avoidance of doubt, any Transfer which qualifies as both a Permitted Transfer and Alternative Permitted Transfer shall be deemed to be a Permitted Transfer and not require prior notice to, or the consent of, Lender. Upon request from Lender, Borrower shall provide to Lender a list of the direct owners of the limited partnership interests of Guarantor and, to the extent known or available to Borrower, the indirect owners of the limited partnership interests of Guarantor.
(e) No Transfer of the Property and assumption of the Loan shall occur during the period that is sixty (60) days prior to and sixty (60) days after a Securitization. Otherwise, Lender’s consent to a Transfer of the Rating Agencies;
Properties and assumption of the Loan shall not be unreasonably withheld provided that Lender receives sixty (iii60) at the time days prior written notice of such Transfer and no Event of Default has occurred and is continuing, and further provided that the following additional requirements are satisfied:
(i) Borrower or Transferee shall pay Lender a transfer fee equal to one-quarter of one percent (0.25%) of the outstanding principal balance of the Loan at the time of such transfer;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(viii) Borrower shall pay, or cause to be paid, to Lender its pay any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs incurred in connection with such sale Transfer (including, without limitation, Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or conveyanceTransferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Properties, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents from and after the date of such Transfer in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not reasonably acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Default or Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements, covenants and legal opinions reasonably required by Lender;
(x) If required by Lender, Transferee shall be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a requalification, reduction, downgrade or withdrawal of the ratings in effect immediately prior to such assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or execute a replacement guaranty and environmental indemnity reasonably satisfactory to Lender;
(xii) Borrower or Transferee shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policy, as modified by the assumption agreement, as a valid first lien on the related Individual Property and naming the Transferee as owner of such Individual Property, which endorsement shall insure that, as of the date of the recording of the assumption agreement, such Individual Property shall not be subject to any additional exceptions or liens other than those contained in the Title Policy issued on the date hereof and the Permitted Encumbrances;
(xiii) Each Individual Property shall be managed by Qualified Manager pursuant to a Replacement Management Agreement; and
(viixiv) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion reflecting such Transfer satisfactory in connection with any form and substance to Lender. Immediately upon a Transfer as a result to such Transferee and the satisfaction of which Sponsor will not own at least 51% all of the equity interests in above requirements, the named Borrower and controlGuarantor herein shall be released from all liability under this Agreement, directly or indirectlythe Note, Borrower, Borrower the Mortgages and the other Loan Documents accruing after such Transfer. The foregoing release shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth effective upon the date the Transfer is expected of such Transfer, but Lender agrees to be effective and provide written evidence thereof reasonably requested by Borrower.
(Af) Lender shall have not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent in violation of the terms of this Agreement. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany previous Transfer.
Appears in 1 contract
Sources: Loan Agreement (Sun Communities Inc)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.11, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions are satisfied:creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(id) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverNotwithstanding the provisions of this Section 5.2.11, Lender’s consent shall not be required ifin connection with one or a series of Transfers, of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such Transfer shall result in the change of Control in a Restricted Party, and as a condition to each such Transfer, Lender shall receive not less than thirty (30) days prior notice of such proposed Transfer. If after giving effect to the any such Transfer, Sponsor owns not more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than 51% forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the equity interests in Closing Date, Borrower and controlsshall, directly or indirectly, Borrower;
no less than thirty (ii30) if as a result days prior to the effective date of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Transfer, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, and the Rating Agencies;. In addition, at all times, (a) Guarantor must continue to Control, and own, directly or indirectly, in the aggregate, at least a 51% legal and beneficial interest in, Borrower, and (b) Acadia Realty Trust must continue to Control, and own, directly or indirectly, at least a 20% legal and beneficial interest in, each of Guarantor and any Affiliated Manager.
(iiie) at No consent to any assumption of the time Loan shall occur on or before the date that is twelve (12) Payment Dates after the Completion of the Improvements. Thereafter, Lender’s consent to a Transfer of the Property and assumption of the Loan shall not be unreasonably withheld provided that Lender receives sixty (60) days prior written notice of such Transfer and no Event of Default has occurred and is continuing, and further provided that the following additional requirements are satisfied for all Transfers other than those described in subsection (d) above:
(i) Borrower shall pay Lender at the time of such Transfer a transfer fee equal to one half of one percent (0.5%) of the outstanding principal balance of the Loan for the first Transfer and one percent (1.0%) of the outstanding principal balance of the Loan for each subsequent Transfer;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(viii) Borrower shall pay, or cause to be paid, to Lender its pay any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs incurred in connection with such sale Transfer (including, without limitation, Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or conveyanceTransferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Property, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate Net Worth and Liquidity reasonably acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not reasonably acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 4.1.35, 5.1.46 and 5.2.10 of this Agreement, no Default or Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements and covenants reasonably required by Lender;
(x) Transferee shall be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a requalification, reduction, downgrade or withdrawal of the ratings in effect immediately prior to such assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion reflecting such Transfer satisfactory in form and substance to Lender;
(xii) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty of Completion, the Guaranty of Recourse Carveouts and the Environmental Indemnity executed by Guarantor or execute replacement guaranties and environmental indemnity reasonably satisfactory to Lender;
(xiii) Borrower shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policy, as modified by the assumption agreement, as a valid first lien on the Property and naming the Transferee as owner of the Property, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Property shall not be subject to any additional exceptions or liens other than those contained in the Title Policy issued on the date hereof and the Permitted Encumbrances; and
(viixiv) in connection with any The Property shall be managed by a Qualified Manager pursuant to a Replacement Management Agreement. Immediately upon a Transfer as a result to such Transferee and the satisfaction of which Sponsor will not own at least 51% all of the equity interests in above requirements, the named Borrower and controlGuarantor herein shall be released from all liability under this Agreement, directly or indirectlythe Note, Borrower, Borrower the Mortgage and the other Loan Documents accruing after such Transfer. The foregoing release shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth effective upon the date the Transfer is expected of such Transfer, but Lender agrees to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanprovide written evidence thereof reasonably requested by Borrower.
Appears in 1 contract
Transfers. (a) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): Except for (i) Permitted Transfers and (ii) Permitted Investments that constitute Permitted Transfers, no Loan Party shall, nor shall allow any Subsidiary to, voluntarily or involuntarily transfer, sell, conveylease or sublease, mortgage, grant, bargain, encumber, pledgesale and leaseback, assign, grant options with respect tolicense, transfer lend or otherwise transfer in any other manner convey or dispose of (voluntarily any equitable, beneficial or involuntarilylegal interest in its businesses, by operation assets or property of law any kind, whether real, personal, or otherwise, mixed and whether tangible or not for consideration intangible, whether now owned or hereafter acquired (including accounts receivable and Equity Interests of record) the Property or any direct or indirect interest thereinSubsidiaries), or forgive, release or compromise any amount owed to such Loan Party or Subsidiary, in each case, in one transaction or series of transactions (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lesseeany thereof, an “Asset Sale”). 4810-9912-0636 v.15 Notwithstanding anything to the contrary herein, the transactions constituting Permitted Transfers (other than clause (Avii) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants definition thereof) shall not constitute an Asset Sale for the purposes of the mandatory prepayment provision in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers2.6(b).
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject anything in this Agreement to the lien of the Mortgage (but not any other mortgagecontrary, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event Loan Party shall, nor shall allow any Subsidiary to (x) directly or indirectly transfer, by means of Default shall have occurred contribution, sale, assignment, lease or sublease, license or sublicense, or other disposition of any kind (including, for avoidance of doubt, as an Investment), any Material Intellectual Property, other than pursuant to clauses (ii), (vi), (vii), (viii) and be continuing (xii) of the definition of Permitted Transfers or (y) permit any Person other than a Loan Party to license or own any interest in any Material Intellectual Property owned by a Loan Party other than pursuant to clauses (ii), (vi), (vii), (viii) and such sale or conveyance shall not result in an Event (xii) of Default;
the definition of Permitted Transfers; (ii) the Person no Material Intellectual Property shall be contributed as an Investment or distributed to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of any Subsidiary other than a Special Purpose Entity Loan Party; and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitizationunless, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, in the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as case of the date transfer of transferequity interests of a Loan Party, of all of the obligations of the Borrower thereafter arising or such Loan Party continues to be performed under this Agreement, the Mortgage and the other a Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, Party after giving effect to such Transfertransfer, Sponsor does not own at least 51% no Loan Party shall directly or indirectly transfer, by means of contribution, sale, assignment, lease or sublease, license or sublicense, or other disposition of any kind (including, for the equity interests avoidance of doubt, as an Investment), any equitable, beneficial or legal interest in Borrower its businesses, assets or property of any kind, whether real, personal, or mixed and control Borrowerwhether tangible or intangible, the Rating Agencies have confirmed that such sale whether now owned or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses hereafter acquired (including any fees due accounts receivable and Equity Interests of Subsidiaries) to the Rating Agencies) in connection with the sale or conveyanceMesoblast USA.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.
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Transfers. (a) A. Without the Lender’s prior written consent, which consent of may be granted or withheld in Lender’s sole and absolute discretion, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof, no Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): (i) directly or indirectly sell, assign, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, transfer or otherwise transfer or dispose of (voluntarily any Property or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property any portion thereof or any direct or indirect legal, beneficial or equitable interest thereinin all or any part of any Property, or (ii) permit a Sale or Pledge suffer any owner, directly or indirectly, voluntarily or involuntarily, of a any direct or indirect ownership or beneficial interest in any Property or any Borrower to transfer such interest, whether by transfer of partnership, membership, stock or other beneficial interest in any entity or otherwise, or (iii) mortgage, pledge, hypothecate or otherwise encumber or permit to be encumbered or grant or permit to be granted a security interest in all or any part of any Property or any Borrower or Operating Lesseeany direct or indirect legal beneficial or equitable interest in any Property or any Borrower. Notwithstanding anything to the contrary set forth in this Loan Agreement or any other Loan Document, transfers of direct or indirect interests in any Borrower pursuant to any will or testament or applicable law of descent upon the death of a natural person that was the holder of the applicable interest in such Borrower, shall be permitted without the consent of Lender.
B. Notwithstanding the restrictions on transfer or encumbrance set forth in Section 7.1, Sole Member shall be permitted to obtain that certain mezzanine financing in the amount of Thirty Million and 00/100 Dollars ($30,000,000.00), made by DOF IV REIT HOLDINGS, LLC (the “Permitted Mezzanine Lender”) pursuant to the Mezzanine Loan Documents (as approved by Lender, the “Permitted Mezzanine Financing”) subject to the subordination of the Permitted Mezzanine Financing to the Secured Obligations as set forth in the Permitted Mezzanine Financing Intercreditor Agreement. Nothing in this Section 7.1(B) shall permit Borrowers or any owner of indirect or direct ownership interests in Borrowers to obtain mezzanine financing other than the Permitted Mezzanine Financing. The Permitted Mezzanine Lender (or any successor holder of the Permitted Mezzanine Financing that is permitted pursuant to the terms of the Permitted Mezzanine Financing Intercreditor Agreement) may, in accordance with the terms of the Permitted Mezzanine Financing Intercreditor Agreement, (i) foreclose upon the collateral provided as part of the Permitted Mezzanine Financing and (ii) assign or transfer any such foreclosed collateral to a “Qualified Transferee” (as defined in the Permitted Mezzanine Financing Intercreditor Agreement), and any such foreclosure, assignment or transfer, if effected in accordance with the terms of the Permitted Mezzanine Financing Intercreditor Agreement, shall not constitute a violation of the Loan Documents.
(1) Notwithstanding the provisions of Section 7.1(A) and Section 7.1(B), and in each case provided that the Transfer Conditions (as hereinafter defined) shall be simultaneously satisfied the following transfers of direct or indirect interests in Borrower shall be permitted without Lender’s prior written consent (any such transfer, a “Permitted Transfer”):
(i) (x) transfers of any direct or indirect limited partnership or non-managing membership interest in any Upper Tier Torchlight Entity, or (y) transfers of any indirect limited partnership or non-managing membership interest in Sole Member;
(ii) a Torchlight Change of Control Event Remedy;
(iii) a Preferred Equity Redemption;
(iv) a Torchlight Corporate Event; and
(v) a TLP Conversion.
(2) For the purposes hereof, “Transfer Conditions” mean all of the following:
(i) No Default or Event of Default has occurred, provided that this subsection (i) shall not apply to a Permitted Transfer pursuant to Section 7.1(C)(ii), Section 7.1(C)(iii) and/or Section 7.1(C)(v).
(ii) Except in respect of a Torchlight Corporate Event or a Preferred Equity Redemption, Torch ▇▇▇▇▇▇▇ continues to Control Preferred Member and all Upper Tier Torchlight Entities.
(iii) Following the proposed Permitted Transfer, each Guarantor (or any Qualified Replacement Guarantor) continues to own a direct and/or indirect interest in each Borrower.
(iv) Borrowers deliver to Lender at least thirty (30) days’ prior written notice of the proposed Permitted Transfer, together with an organizational chart illustrating the ownership structure both before and after the consummation of the proposed Permitted Transfer, which organizational chart shall set forth Borrowers’ direct and indirect upstream owners (including, without limitation, any Qualified Replacement Guarantor described in clause (x) or clause (xii) below), the percentage interests held by each such owner and the type of entity of each such owner (an “Organizational Chart”), provided however that with respect to Permitted Transfers made pursuant to Section 7.1(C)(ii), Section 7.1(C)(iii) and/or Section 7.1(C)(v), such deliveries in this subsection (iv) may be delivered to Lender simultaneously with the occurrence of such Permitted Transfer.
(v) Borrowers shall pay or reimburse Lender for all of the actual costs, fees and expenses incurred by Lender in respect of such proposed Permitted Transfer, including, without limitation, out-of-pocket attorneys’ fees incurred by Lender, whether or not such proposed Permitted Transfer is consummated.
(vi) Any Person to whom or to which any such direct or indirect limited partnership or non-managing membership interest is transferred shall comply with the requirements of Borrowers, Guarantors, Borrower Control Person and Persons that directly or indirectly Controls any Guarantor (other than any Guarantor that is an individual) set forth in Section 5.1.21 hereof, and if Lender requests, the proposed transferees and its constituent members or other owners shall execute a certificate in form and substance satisfactory to Lender confirming such compliance (except that identifying information shall not be required for any Transfers made in the ordinary course of business over a national securities exchange); provided however that in connection with a Torchlight Change of Control Event Remedy, the conditions in this subsection (vi) shall be deemed satisfied if such conditions have been satisfied under the Permitted Mezzanine Intercreditor Agreement.
(vii) Such proposed Permitted Transfer does not subject Lender or any of its Affiliates to any civil or criminal penalties in any jurisdiction or otherwise constitute an unlawful act, offense or crime by Lender or any of its Affiliates, including, without limitation, under any of the laws, regulations and executive orders described in Section 5.1.21 hereof.
(viii) Intentionally omitted.
(ix) Simultaneously with the Permitted Transfer, Borrowers shall provide Lender with (A) evidence reasonably satisfactory to Lender that all of the Transfer Conditions have been satisfied with respect to such proposed Permitted Transfer and (B) a certificate signed by Borrowers and each Guarantor that (I) certifies to Lender that all of the Transfer Conditions have been satisfied with respect to such proposed Transfer, (II) attaches (x) a final Organizational Chart confirming the new ownership structure of Borrowers (certified as being true, complete and correct by Borrowers and each Guarantor), and (III) attaches (x) a copy of the documents effectuating the proposed Permitted Transfer and a copy of the Organizational Documents of the entities affected by the proposed Permitted Transfer, as amended, and (y) any other information that Lender may reasonably request.
(x) In the event that the Permitted Transfer is a Torchlight Change of Control Event Remedy, the following additional conditions shall be applicable:
1. Preferred Member shall obtain a Qualified Replacement Guarantor that satisfies the Guarantor Minimum Available Liquidity Requirement and the Guarantor Minimum Net Worth Requirement, and such Qualified Replacement Guarantor shall execute and deliver to Lender, a replacement non-recourse carveout guaranty and a replacement environmental indemnity agreement in favor of Lender, each in substantially the same form as the Non-Recourse Carveout Guaranty and the Environmental Indemnity Agreement (collectively, the “Replacement Guaranties”) and such other instruments as Lender may reasonably require; provided that the Replacement Guaranties shall cover only events that occur or state of affairs that exists from and after the date of the consummation by Preferred Member of the Torchlight Change of Control Event Remedy; provided however that in connection with a Torchlight Change of Control Event Remedy, the conditions in this subsection (x)(i) shall be deemed satisfied if such conditions have been satisfied under the Permitted Mezzanine Intercreditor Agreement.
2. Each Property shall be managed by pursuant to a Property Management Agreement delivered to, and approved by, Lender, and with a Property Manager consented to by Lender, such consent not to be unreasonably withheld, conditioned or delayed, and otherwise in accordance with Section 5.1.11 hereof.
(A) Simultaneously with the exercise of the Torchlight Change of Control Event Remedy, Preferred Member shall provide to Lender (1) written notice of the Torchlight Change of Control Event and certificate that is signed by an authorized officer of Preferred Member certifying to Lender that all of the Transfer Conditions have been satisfied or will be satisfied prior to consummating the Torchlight Change of Control Event Remedy (other than conditions that are subject to the approval of Lender and for which Lender has received all reasonably requested back-up information as of the date of such Officer’s Certificate), such certificate to include, without limitation, the following: (I) a reasonably detailed description of the Torchlight Change of Control Event would permit Preferred Member to commence the Torchlight Change of Control Event Remedy pursuant to the Sole Member Operating LeaseAgreement, (II) an Organizational Chart illustrating the ownership structure of both (x) Borrowers and (y) each of the Preferred Member and Upper Tier Torchlight Entities and Torch ▇▇▇▇▇▇▇, both before and after the consummation of the proposed Torchlight Change of Control Event Remedy, which Organizational Chart shall set forth the direct and indirect upstream owners (including, without limitation, any Qualified Replacement Guarantor) of Borrowers, and each of the Preferred Member and Upper Tier Torchlight Entities and Torch ▇▇▇▇▇▇▇, the percentage interests held by each such owner and the type of entity of each such owner, and (2) copies of any and all material notices, pleadings, agreements, motions and briefs served upon, delivered to or with any party in connection with the Torchlight Change of Control Event, (B) pursuant Preferred Member shall otherwise keep Lender reasonably apprised as to Leases the status of space the Torchlight Change of Control Event, and (C) Lender shall have received all other information and documents reasonably requested by such party confirming the conditions concerning the events under the Sole Member Operating Agreement that are the basis for the Torchlight Change of Control Event that are reasonably requested by Lender. Lender may request reasonable evidence that the requirements of this Section 7.1(C)(x) have been satisfied, and Preferred Member shall provide such evidence within five (5) Business Days following such request. In addition, not less than ten (10) Business Days following the consummation of such Torchlight Change of Control Event Remedy, Preferred Member shall deliver to Lender (I) an Officer’s Certificate certifying that (x) such Torchlight Change of Control Event Remedy was consummated in accordance with provisions of this Agreement, including, without limitation, the Improvements Transfer Conditions and that the Organizational Chart and other documents and items included as part of the certificate delivered to tenants Lender prior to the consummation of such Torchlight Change of Control Event Remedy as required by this Section 7.1(C)(x) remain true, complete and correct and (II) such other additional information that Lender may reasonably request to evidence that the Torchlight Change of Control Event Remedy was in fact made in accordance with this Agreement.
4. Within ten (10) days following the exercise of the Torchlight Change of Control Event Remedy, Preferred Member shall deliver to Lender a substantive non-consolidation opinion prepared by legal counsel reasonably acceptable to Lender, in form and substance reasonably acceptable to Lender.
(xi) For the avoidance of doubt, a Preferred Equity Redemption that is consummated in accordance with the provisions of this Section 5.1.20, (C7.1(C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender orpermitted, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subjectprovided, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrowerfor further clarification, the Rating Agencies have confirmed membership interests of Preferred Member that such sale or conveyance, in are redeemed may not be transferred to any Person other than Sole Member and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or no other encumbrance) transfers of any direct or indirect interests in Borrower is shall be permitted provided in connection with such Preferred Equity Redemption.
(xii) In the event that the Permitted Transfer is a Torchlight Corporate Event, the following additional conditions are satisfiedshall be applicable:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor 1. An Approved Real Estate Company Controls and owns not less than fifty-one percent (51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii%) if as a result of any such Transfer or series of Transfers more than 49% of the direct or and/or indirect ownership interests in Borrower Preferred Member.
2. Preferred Member shall be transferred to obtain a Person individually or together with its Affiliates not owning at least 49% of Qualified Replacement Guarantor that satisfies the direct or indirect ownership interests in Borrower immediately prior to Guarantor Minimum Available Liquidity Requirement and the Guarantor Minimum Net Worth Requirement, and such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower Qualified Replacement Guarantor shall execute and deliver to Lender an Additional Insolvency Opinion which Replacement Guaranties and such other instruments as Lender may reasonably require; provided that the Replacement Guaranties shall cover only events that occur or state of affairs that exists from and after the date of the consummation of the Torchlight Corporate Event.
3. Each Property shall be relied upon managed by pursuant to a Property Management Agreement delivered to, and approved by, Lender, and with a Property Manager consented to by Lender, the Rating Agencies such consent not to be unreasonably withheld, conditioned or delayed, and their respective counsel, successors and assigns, otherwise in accordance with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;Section 5.1.11.
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager 4. Each of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause certificates required to be paidexecuted and/or delivered pursuant to this Section 7.1(C) by Borrower and/or Guarantors shall also be executed and/or delivered, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with as applicable, by such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the LoanApproved Real Estate Company.
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Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (individually or collectively, a “Transfer”): ), (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any part thereof or any direct or indirect legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) in each case pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(bc) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a price to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) except as set forth in this Section 5.2.10 with respect to Guarantor if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the Manager (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 or Section 5.2.1 hereof. For the avoidance of doubt, for purposes of this Section 5.2.10. a Transfer shall not include (x) any issuances, redemptions, conversions, sales, purchases or transfers of the public shares of Guarantor, or (y) any of the transactions, contributions, transfers or steps occurring on or prior to the date of this Agreement as described in the Registration Statement of Guarantor filed with the U.S. Securities and Exchange Commission that were required for Guarantor to become an indirect owner of the Property.
(d) Notwithstanding the foregoingprovisions of this Section 5.2.10, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which Lender’s consent shall not be unreasonably withheld;
required in connection with (ivA) Lender has received an Additional Insolvency Opinion which may be relied upon by Lenderone or a series of Transfers other than publicly traded shares (excluding the Transfers referenced in subparts (B) and (C) immediately following) of not more than forty-nine percent (49%) of the direct or indirect stock, the Rating Agencies limited partnership interests or non-managing membership interests (as the case may be) in Borrower, (B) Transfers of direct or indirect interests in Borrower by and their respective successors between existing Affiliates or any existing Restricted Party as the Closing Date, and assigns(C) Transfers of the limited partnership interests of the REIT Operating Partnership, including any redemption of such limited partnership interests or the conversion of such limited partnership interests into shares of Guarantor, so long as Guarantor continues to Control the REIT Operating Partnership; provided, however, in each case, no such Transfer or series of Transfers shall result in the change of Control in a Restricted Party, and each such Transfer shall be conditioned upon the following: (i) receipt by Lender of not less than ten (10) days prior written notice of such proposed Transfer (except, for the avoidance of doubt, with respect to transfers of the Transferee public shares of Guarantor or Transfers of the limited partnership interests in the REIT Operating Partnership as described in subpart (C) above), (ii) continued compliance with the relevant provisions of Section 4.1.30 hereof and its applicable affiliatesthe definition of “Special Purpose Entity” contained herein, which Additional Insolvency Opinion and (iii) Borrower’s ability to, after giving effect to such Transfer, remake the representations contained herein relating to ERISA matters and the Patriot Act, OFAC and matters concerning Embargoed Persons (and, upon Lender’s request, Borrower shall be reasonably acceptable deliver to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, Officer’s Certificate containing such updated representations effective as of the date of transferthe consummation of such Transfer). In addition, at all times, either (x) a Qualified Transferee (or an entity Controlled by a Qualified Transferee) or (y) the REIT Operating Partnership must continue to Control Borrower, Principal and any Affiliated Manager and Guarantor must continue to own, directly or indirectly, at least a twenty five percent (25%) legal and beneficial interest in Borrower. For purposes of all this Section 5.2.10, a change of the obligations members of the Borrower thereafter arising board of directors of Guarantor or the termination of the advisory agreement by and between City Office Real Estate Management Inc. and Guarantor shall not be considered to be performed under a change of Control of Guarantor, so long as Guarantor remains a public company.
(e) Borrower has no right to assign, convey or transfer the Property subject to the Loan and Lender has no obligation to accept the assumption of the Loan by any Person. Notwithstanding the provisions of this Section 5.2.10(e), after the first anniversary of the Closing Date the Loan may be assumed by acquisition of title to the Property or acquisition of the Controlling interests in connection with the Guarantor, REIT Operating Partnership, Principal or Borrower pursuant to any written agreement entered into with a Qualified Transferee or an entity Controlled by a Qualified Transferee without the prior written consent of Lender (a “Pre-Approved Transfer”), provided, that the following conditions are met: (i) a modification of the terms hereof, the Note, the Mortgage or the other Loan Documents to reflect the new ownership structure; (ii) an assumption of this Agreement, the Note, the Mortgage and the other Loan Documents, subject, however, subject to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager9.4 hereof; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time payment of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager all of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable actual out-of-pocket fees and expenses (including any fees due to the Rating Agencies) incurred by Lender in connection with such sale loan assumption including, without limitation, the cost of any third party reports and searches, reasonable legal fees and expenses, application fees or conveyancerequired legal opinions; and
(iv) payment of an assumption fee of one percent (1%) of the outstanding principal balance of the Loan together with an application fee of $5,000; (v) [intentionally omitted]; (vi) the proposed transferee’s continued compliance with all of the representations and covenants set forth herein, including, without limitation, in Section 4.1.30, Section 4.1.35 and Section 5.2.9 hereof; (vii) in connection with any Transfer as a result the delivery of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice evidence reasonably satisfactory to Lender of that the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower transferee is a Special Purpose Entity if such transferee is to be transferredthe Borrower or Principal; (viii) prior to any release of the Guarantor, identify a substitute guarantor acceptable to Lender in its sole and absolute discretion shall have assumed the proposed transferee Guaranty and set forth the date the Transfer is expected Environmental Indemnity executed by Guarantor or executed a replacement guaranty and an environmental indemnity reasonably satisfactory to Lender; (ix) satisfactory completion of an OFAC/Patriot Act certification; or (x) such other conditions as Lender shall determine in its reasonable discretion to be effective in the interest of Lender, including, without limitation, regulatory requirements with respect to the borrower and (A) its sponsors, the creditworthiness, reputation and qualifications of the transferee with respect to the Loan and the Property. Lender shall have consented not be required to such Transfer demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and (B) Borrower shall pay to Lender payable upon a loan assumption fee without Lender’s consent.
(f) Notwithstanding anything in the Loan Documents to the contrary, Guarantor and the REIT Operating Partnership, may incur the following indebtedness without the Lender’s prior written consent: (i) unsecured indebtedness, (ii) indebtedness secured by interests in, or assets or accounts of, entities other than Borrower or Principal, (iii) indebtedness secured by liens or mortgages on properties other than the Property, and (iv) distributions of 1% of excess cash flow from the then outstanding principal amount of Property by Borrower, Principal and REIT Operating Partnership subject to the Loanlimitations set forth in the Loan Documents (the indebtedness in (i), (ii), (iii) and (iv) being referred to as “Other Permitted Indebtedness”).
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party (collectively, a “Transfer”), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20 (provided, however, that Lender acknowledges Borrower’s right to request approval of a Transfer).
(c) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a price to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(d) Notwithstanding the provisions of this Section 5.1.20, the following transfers shall not be deemed to be a Transfer: (Ci) the Room License AgreementsSale or Pledge, in one or a series of transactions, of not more than forty-nine percent (49%) of the stock in a Restricted Party; provided, however, no such transfers shall result in the change of voting control in the Restricted Party, and as a condition to each such transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed transfer, and (Dii) Permitted Transfersthe Sale or Pledge, in one or a series of transactions, of not more than forty-nine percent (49%) of the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, as a condition to each such transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed transfer.
(be) Notwithstanding the foregoingprovisions of this Section 5.2.10, Borrower shall have a sale one-time right to transfer, not more than eighty percent (80%) of the stock, limited partnership interests or conveyance by Borrower non-managing membership interests (as the case may be) in a Restricted Party provided that: (a) the proposed transferee shall be a Qualified Transferee; (b) if the Manager shall not be the manager of the Property subject to following such transfer, then the lien of the Mortgage Manager must be a Qualifying Manager; (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(ic) no Event of Default shall have occurred and be continuing under the Loan Documents; (d) payment by Borrower to Lender of all of fees and expenses incurred in connection with such sale transfer including, without limitation, the cost of any third party reports, legal fees and expenses, rating agency fees (including rating agency counsel) and expenses or conveyance shall not result in an Event of Default;
required legal opinions; (iie) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements delivery of a Special Purpose Entity nonconsolidation opinion reflecting the proposed transfer satisfactory in form and the organizational documents of the Transferee are reasonably acceptable substance to Lender and, after a Securitization, to and the Rating Agencies;; and (f) the delivery of evidence satisfactory to Lender that the single purpose nature and bankruptcy remoteness of Borrower, its shareholders, partners or members, as the case may be, following such transfers are in accordance with the then current standards of Lender and the Rating Agencies.
(iiif) Notwithstanding the provisions of this Section 5.2.10, Borrower shall have the right to transfer the Properties and/or any Restricted Party may transfer the stock, partnership interests or membership interests (as the case may be) in a Restricted Party to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and/or Guarantor or an entity in which ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and/or Guarantor owns directly or indirectly all of the beneficial interests; provided that: (a) if the Manager shall not be the manager of the Property following such sale or conveyance occurs transfer, then the Manager must be a Qualifying Manager; (b) no Event of Default shall have occurred and be continuing under the Loan Documents; (c) prior to a Securitization, Borrower shall have received the prior approval of Lender, which approval Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies withhold and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, Borrower shall have obtained prior written confirmation from the applicable Rating Agencies that such transfer will not result in a downgrade, withdrawal or qualification of the then current ratings of the Securities or any class thereof; (d) payment by Borrower to Lender of all of fees and expenses incurred in connection with such transfer including, without limitation, the cost of any third party reports, legal fees and expenses, rating agency fees (including rating agency counsel) and expenses or required legal opinions; (e) the delivery of a nonconsolidation opinion reflecting the proposed transfer satisfactory in form and substance to Lender and the Rating Agencies;; and (f) the delivery of evidence satisfactory to Lender that the single purpose nature and bankruptcy remoteness of Borrower, its shareholders, partners or members, as the case may be, following such transfers are in accordance with the then current standards of Lender and the Rating Agencies.
(vg) Notwithstanding the Transferee provisions of this Section 5.2.10, Lender shall execute an assumptionnot unreasonably withhold its prior written consent to a one-time sale, effective as assignment or other transfer of all the Properties, provided that (i) Lender receives sixty (60) days’ prior written notice of such transfer and (ii) Lender reserves the right to condition the consent required hereunder upon (a) a modification of the date of transfer, of all terms hereof and of the obligations Mortgage, the Note or the other Loan Documents; (b) an assumption of the Borrower thereafter arising or to be performed under this Agreement, the Note, the Mortgage and the other Loan DocumentsDocuments as so modified by the proposed transferee, subject, however, subject to the provisions of Section 9.3 hereof 9.4 of this Agreement; (c) payment of all of fees and upon expenses incurred in connection with such assumptiontransfer including, Borrower shall be released from all liabilities without limitation, the cost of any third party reports, legal fees and obligations under expenses, rating agency fees (including rating agency counsel) and expenses or required legal opinions; (d) the Loan Documents;
payment of a non-refundable $5,000 application fee and, in the event that the proposed transferee is not an Affiliate of Borrower, an assumption fee equal to one percent (vi1%) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount balance of the Loan;
; (viiie) ifthe delivery of a nonconsolidation opinion reflecting the proposed transfer satisfactory in form and substance to Lender; (f) the proposed transferee’s continued compliance with the representations and covenants set forth in Section 4.1.30 of this Agreement; (g) the delivery of evidence satisfactory to Lender that the single purpose nature and bankruptcy remoteness of Borrower, after giving effect its shareholders, partners or members, as the case may be, following such transfers are in accordance with the then current standards of Lender and the Rating Agencies; (h) prior to such Transfer, Sponsor does not own at least 51% any release of the equity interests Guarantor, a substitute guarantor reasonably acceptable to Lender shall have assumed the Guaranty executed by Guarantor or executed a replacement guaranty reasonably satisfactory to Lender; (i) if required by Lender, confirmation in Borrower and control Borrower, writing from the Rating Agencies have confirmed to the effect that such sale or conveyance, in and of itself, transfer will not result in a downgradere-qualification, qualification reduction or withdrawal of the then current ratings rating assigned to the SecuritiesSecurities in any applicable Securitization; and
(ixj) Borrower pays no Event of Default shall have occurred and be continuing under the Loan Documents; or (k) such other conditions as Lender shall determine in its reasonable discretion to be in the interest of Lender’s reasonable costs , including, without limitation, the creditworthiness, reputation and expenses (including any fees due qualifications of the transferee with respect to the Rating Agencies) in connection with Loan and the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Property. Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower Debt immediately due and controls, directly or indirectly, payable upon Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or ’s sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender andconveyance, after a Securitizationmortgage, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager grant, bargain, encumbrance, pledge, assignment, or transfer of the Property must be a Qualified Manager;
(v) ifwithout Lender’s consent. This provision shall apply to every sale, after giving effect to such Transferconveyance, Sponsor does not own at least 51% mortgage, grant, bargain, encumbrance, pledge, assignment, or transfer of the equity interests in Borrower and control BorrowerProperty regardless of whether voluntary or not, the Rating Agencies shall have confirmed that such Transferor whether or not Lender has consented to any previous sale, in and of itselfconveyance, will not result in a downgrademortgage, qualification grant, bargain, encumbrance, pledge, assignment, or withdrawal transfer of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the LoanProperty.
Appears in 1 contract
Sources: Loan Agreement (Koger Equity Inc)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party (collectively, a “Transfer”), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other encumbrancethan in accordance with Section 5.1.22 hereof.
(d) Notwithstanding the provisions of this Section 5.2.10, none of the following transfers shall be deemed to be a Transfer: (i) the sale or transfer, in one or a series of transactions, of not more than forty-nine percent (49%) of the stock in a Restricted Party; provided, however, no such sales or transfers shall result in the change of voting control in the Restricted Party, and as a condition to each such sale or transfer, Lender shall receive not less than thirty (30) days prior notice of such proposed sale or transfer, (ii) the sale or transfer, in one or a series of transactions, of not more than forty-nine percent (49%) of the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such sales or transfers shall result in the change of voting control in the Restricted Party, and as a condition to each such sale or transfer, Lender shall receive not less than thirty (30) days prior notice of such proposed sale or transfer, (iii) the sale, transfer or issuance of stock in Cousins Properties Incorporated (the “Traded Entity”) provided such stock is listed on the New York Stock Exchange or such other nationally recognized stock exchange, and (iv) the transfer contemplated by Section 10.24 hereof. In addition, at all times, the Traded Entity must continue to control Borrower and Affiliated Manager and own, directly or indirectly, at least a 51% interest in Borrower and Affiliated Manager.
(e) Except for the assumption contemplated by Section 10.24 of this Agreement, which is being consummated on or about the date hereof, no further assumption of the Loan shall occur on or before the first anniversary of the first Payment Date. Thereafter, Lender reserves the right to consent to any subsequent assumption, and Lender may condition the consent required hereunder upon (a) intentionally omitted; (b) an assumption of this Agreement, the Note, the Security Instrument and the other Loan Documents as so modified by the proposed transferee, subject to the provisions of Section 9.4 hereof; (c) payment of all of the fees and expenses incurred in connection with such Transfer including, without limitation, the cost of any third party reports, legal fees and expenses, Rating Agency fees and expenses or required legal opinions; (d) the payment of a non-refundable $5,000 application fee and an assumption fee equal to one quarter of one percent (0.25%) of the outstanding principal balance of the Loan for each Transfer following the first Transfer after the assumption contemplated by Section 10.24 of this Agreement; (e) the delivery of a nonconsolidation opinion reflecting the proposed transfer satisfactory in form and substance to Lender; (f) the proposed transferee’s continued compliance with the representations and covenants set forth in Section 4.1.30 and Section 5.2.9 hereof; (g) the delivery of evidence satisfactory to Lender that the single purpose nature and bankruptcy remoteness of Borrower, its shareholders, partners or members, as the case may be, following such transfers are in accordance with the then current standards of Lender and the Rating Agencies; (h) intentionally omitted; (i) if required by Lender, confirmation in writing from the Rating Agencies to the effect that such transfer will not result in a re-qualification, reduction or withdrawal of the then current rating assigned to the Securities or any class thereof in any applicable Securitization; or (j) such other conditions as Lender shall determine in its reasonable discretion to be in the interest of Lender, including, without limitation, the creditworthiness, reputation and qualifications of the transferee with respect to the Loan and the Property. Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon a Transfer without Lender’s consent. This provision shall apply to every Transfer (other than transfers that are deemed not a Transfer pursuant to Subsection 5.2.10(d) above), regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer. Notwithstanding the foregoing, in connection with an Intercompany Transfer, Lender shall not require (i) payment of the assumption fee contemplated by subsection (d) hereof and (ii) the creditworthiness, reputation and qualifications of a transferee in connection with an Intercompany Transfer shall be deemed to be acceptable to Lender so long as the Traded Entity Controls such transferee and owns, directly or indirectly, at least 51% of the ownership interests of such transferee.
(f) If as a result of any direct or indirect Transfers of interests in Borrower or any Principal (regardless of whether Lender’s consent is required in connection therewith) more than forty-nine percent (49%) in the aggregate of direct or indirect interests in Borrower or Principal is permitted provided owned by any Person that owned less than a forty-nine percent (49%) direct or indirect interest in Borrower or Principal as of the following conditions are satisfied:Closing Date, Lender shall, as a condition to such Transfer receive a nonconsolidation opinion acceptable to it and the Rating Agencies.
(ig) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect Anything contained in Section 5.2.10 to the Transfercontrary notwithstanding, Sponsor owns not less than 51% the Traded Entity shall be permitted, without the consent of the equity interests in Borrower Lender, to Transfer its direct and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower (but Traded Entity shall not cause or permit Borrower to Transfer the Property) in connection with a merger, consolidation or sale of all or substantially all of the assets of Traded Entity (a “Sale Event”), subject to the following conditions: (i) such Sale Event shall occur as a single transaction and if such Sale Event shall be transferred a sale of substantially all of the Traded Entity’s assets, such merger, consolidation or sale shall be to a Person individually or together with its Affiliates not owning at least 49% of single Person, (ii) the direct or indirect ownership interests in Property shall be managed by a Qualified Manager, (iii) Borrower immediately prior to such Transfer (or as reflected in the most recent shall deliver an Additional Insolvency Opinion delivered in connection with such Sale Event, (iv) Borrower shall pay all of Lender’s fees and expenses incurred in connection with such Sale Event, (v) the payment of a non-refundable $5,000 application fee and an assumption fee equal to Lender)one quarter of one percent (0.25%) of the outstanding principal balance of the Loan for each Transfer following the first Transfer after the assumption contemplated by Section 10.24 of this Agreement, (vi) the proposed transferee’s continued compliance with the representations and covenants set forth in Section 5.2.9 hereof, (vii) if permitted by law, Lender shall receive not less than thirty (30) days prior notice of such Sale Event and (viii) Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, confirmation in writing from the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, Sale Event will not result in a downgradere-qualification, qualification reduction or withdrawal of the then current ratings rating assigned to the Securities
(vi) Borrower shall pay, Securities or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) class thereof in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanapplicable Securitization.
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Properties in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Properties as a means of maintaining the value of the Properties as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Properties so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Properties.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the any Individual Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party (collectively, a “Transfer”), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, 5.1.20 and (CB) the Room License Agreements, disposition of equipment and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject other personal property pursuant to the lien of the Mortgage (but not any other mortgage, lien replacement thereof or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into otherwise in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents operation of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyanceProperties.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell an Individual Property or any part thereof for a pledgeprice to be paid in installments; (ii) with the exception of the Operating Lease, hypothecationan agreement by Borrower leasing all or a substantial part of an Individual Property for other than actual occupancy by a space tenant thereunder or a sale, creation assignment or other transfer of, or the grant of a security interest in, Borrower’s or Operating Lessee’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of this Section 5.2.10, the following transfers shall not be deemed to be a Transfer: (i) the Sale or Pledge, in one or a series of transactions, of not more than forty-nine percent (49%) of the stock in a Restricted Party or other encumbrancebeneficial interest, and (ii) the Sale or Pledge, in one or a series of transactions, of not more than forty-nine percent (49%) of the limited partnership interests or membership interests (as the case may be) in a Restricted Party; provided, however, in the case of each of the foregoing (i) and (ii), (A) no such sales or transfers shall result in the change of voting control in the Restricted Party, (B) as a condition to each such sale or transfer, Lender shall receive not less than thirty (30) days prior notice of such proposed sale or transfer, (C) if after giving effect to any such Sale or Pledge, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in Borrower is permitted provided a Restricted Party are owned by any Person and its Affiliates that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not owned less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
forty-nine percent (ii49%) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests interest in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% such Restricted Party as of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, acceptable to Lender and the Rating Agencies Agencies, (D) no such Sale or Pledge of any direct ownership interests in Borrower, Principal or Operating Lessee shall be permitted, and their respective counsel(E) Borrower, successors Principal and assignsOperating Lessee shall each continue to be a Special Purpose Entity following such Sale or Pledge. In addition, at all times, Guarantor must continue to control Borrower, Principal, Operating Lessee, and any Affiliated Manager and own, directly or indirectly, at least a one hundred percent (100%) interest in Borrower, Operating Lessee, Principal and Affiliated Manager. Lender’s consent or approval shall not be required with respect to (I) the trading or issuance of shares or other securities of Highland Hospitality Corporation on a nationally recognized stock exchange, or (II) the transfer, sale or issuance of operating partnership units or other securities of Guarantor to a Qualified Transferee, provided that such Qualified Transferee or Highland Hospitality Corporation controls Guarantor and owns not less than a thirty percent (30%) interest in Guarantor, or (III) the transfer, sale or issuance of operating partnership units of Guarantor in connection with the merger, reorganization or consolidation of Highland Hospitality Corporation or Guarantor, provided that the surviving entity is a publicly listed company on a nationally recognized exchange and such entity has a net worth greater than the net worth of Highland Hospitality Corporation immediately before such merger, reorganization or consolidation, provided further, that with respect to (II) and (III), (x) as a condition to each such transfer, sale or issuance, Lender shall receive not less than fifteen (15) days prior notice of such proposed transfer transfer, sale or saleissuance, which and (y) if after giving effect to any such transfer, sale or issuance, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, and the Rating Agencies;.
(iiie) at Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon a Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer.
(f) No consent to any assumption of the Loan shall occur on or before the first (1st) anniversary of the first (1st) Payment Date. Thereafter, Lender’s consent to a one (1) time Transfer of the Properties shall not be unreasonably withheld provided that Lender receives sixty (60) days prior written notice of such Transfer and no Event of Default has occurred and is continuing, and further provided that the following additional requirements are satisfied:
(i) Borrower shall pay Lender a transfer fee equal to one percent (1%) of the outstanding principal balance of the Loan at the time of such transfer;
(ii) the proposed transferee (“Transferee”) shall be a Qualified Transferee;
(iii) if the Manager shall not be the manager of the Properties following such transfer, then the Manager must be a Qualified Manager pursuant to a Replacement Management Agreement;
(iv) following if required by Lender, delivery of confirmation in writing from each Rating Agency to the effect that such Transfer the property manager transfer and assumption of the Property must be Loan will not result in a Qualified Managerreduction, downgrade, withdrawal or qualification of the ratings in effect immediately prior to such proposed transfer for the Securities or any class thereof which then are outstanding;
(v) ifthe Transferee shall have executed and delivered to Lender an assumption agreement in form and substance reasonably acceptable to Lender, after giving effect evidencing such Transferee’s agreement to such Transferabide and be bound by the terms of this Agreement (including, Sponsor does not own at least 51% of the equity interests in Borrower without limitation, Sections 4.1.30 and control Borrower5.2.9 hereof), the Rating Agencies shall have confirmed that Note, the Mortgages and the other Loan Documents, as applicable, together with such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securitieslegal opinions as may be reasonably requested by Lender;
(vi) Lender shall have received an Additional Insolvency Opinion covering the Transferee and such other persons reasonably required by Lender and the Rating Agencies, such Additional Insolvency Opinion to be reasonably satisfactory to Lender and the Rating Agencies;
(vii) Borrower shall paydeliver, at its sole cost and expense, an endorsement to the Title Insurance Policies, as modified by the assumption agreement, as a valid first lien on the Properties and naming the Transferee as owner of the Properties, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Properties shall not be subject to any additional exceptions or cause to be paid, liens other than those contained in the relevant Title Insurance Policies issued on the Closing Date and the Permitted Encumbrances relating thereto;
(viii) the delivery of evidence satisfactory to Lender that the single purpose nature and bankruptcy remoteness of Borrower, its shareholders, partners or members, as the case may be, following such Transfer is in accordance with the then current standards of Lender and the Rating Agencies;
(ix) prior to any release of Guarantor, a substitute guarantor reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and the Environmental Indemnity executed by Guarantor or executed a replacement guaranty and environmental reasonably satisfactory to Lender; and
(x) payment of all of fees and expenses reasonably incurred by or on behalf of Lender in connection with such Transfer including, without limitation, the cost of any required third party reports, reasonable legal fees and expenses, Lender’s out-of-pocket expenses, recording fees, title insurance premiums, mortgage and intangible taxes, Rating Agency fees and expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanrequired legal opinions.
Appears in 1 contract
Transfers. (a) Without Tenant shall not mortgage, pledge, hypothecate, encumber, or permit any lien to attach to this Lease or any interest hereunder without the prior written consent of LenderLandlord, and except to the extent otherwise set forth which consent may be withheld in this Section 5.2.10 and Section 2.5 hereof, Borrower shall Landlord's sole discretion. Provided that Landlord has not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any good faith, given Tenant notice of the following termination of this Lease (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect interest thereinTenant is contesting said termination), or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower as of the Property subject date of Tenant's notice to the lien Landlord and/or as of the Mortgage (but not any other mortgageeffective date of such assignment or subletting, lien or other encumbrance (other than Tenant will have the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender andright, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyancewith Landlord's consent, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon , conditioned or delayed, to assign this Lease, permit any assignment, or other transfer of this Lease by Lenderoperation of law, sublet the Rating Agencies and their respective successors and assignsPremises or any part thereof, with respect to or enter into any license or concession agreements or otherwise permit the Transferee occupancy or use of the Premises or any part thereof by any persons other than Tenant and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
employees and contractors (v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising foregoing are hereinafter sometimes referred to collectively as "Transfers" and any person to whom any Transfer is made or sought to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, made is hereinafter sometimes referred to as a "Transferee"). Notwithstanding anything to the provisions contrary contained in this Lease, Tenant agrees that no partial assignment of Section 9.3 hereof and upon such assumption, Borrower this Lease shall be released from all liabilities and obligations under permitted without the Loan Documents;
(vi) following such sale or conveyance the property manager express written consent of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyanceLandlord, which consent shall not may be unreasonably withheld; provided howeverwithheld in the sole and absolute discretion of Landlord, Lender’s consent shall not be required ifand any attempt by Tenant to make a partial assignment of this Lease, after giving effect to the Transferor any interest in this Lease, Sponsor owns not less than 51% in violation of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower this sentence shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies null and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanvoid.
Appears in 1 contract
Sources: Office Lease (Cytyc Corp)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein (except in connection with any Condemnation) or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (B) Permitted Transfers, (C) the Room License AgreementsPermitted Encumbrances, and (D) Permitted Transfers.
Conditional Transfers or (bE) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into Change in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyanceControl.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Owner or Operating Tenant agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Owner or Operating Tenant leasing all or a substantial part of the Property (other than the Operating Lease) for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof; and (viii) if at any time Guarantor shall fail to continue to Control Owner, Operating Tenant and Guarantor or Procaccianti shall fail to own the required direct or indirect interests interest in Borrower is permitted provided that the following conditions are satisfied:described in subsection (d) below.
(id) if such sale or conveyance occurs prior Notwithstanding the provisions of this Section 5.2.10 and in addition to a SecuritizationPermitted Transfers, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverPermitted Conditional Transfers and Permitted Change in Control, Lender’s consent shall not be required ifin connection with one or a series of Transfers, after giving effect of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, (i) no such Transfer shall result in the change of Control in a Restricted Party, (ii) as a condition to the each such Transfer, Sponsor owns Lender shall receive not less than 51thirty (30) days prior written notice of such proposed Transfer, and (iii) prior to the Securitization, Lender shall have performed searches and/or received other diligence such that Lender is in compliance with Lender’s then current “know your customer” requirements, (y) after the Securitization, to the extent that any Transfer will result in the transferee (either itself or collectively with its Affiliates) owning a 10% or greater equity interest (directly or indirectly) in Owner or Operating Tenant, Lender shall have received OFAC Searches related to any such transferee and (z) to the extent that any Transfer will result in the transferee (either itself or collectively with its Affiliates) owning a 50% or greater equity interest (directly or indirectly) in Owner or Operating Tenant, Lender shall have received acceptable litigation searches. In addition, at all times (other than in connection with or after a Permitted Conditional Transfer or Permitted Change in Control), Guarantor or, in the event of a replacement of Guarantor by a Replacement Guarantor in accordance with the equity interests in Borrower and controlsterms hereof, Replacement Guarantor must own, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct a five percent (5.0%) legal and beneficial interest in Owner and Operating Tenant and Procaccianti must continue to Control Owner and Operating Tenant and own, directly or indirect ownership interests indirectly, at least a ten percent (10%) legal and beneficial interest in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Owner and Operating Tenant. Upon request from Lender), Borrower shall deliver promptly provide Lender a revised version of the organizational chart delivered to Lender an Additional Insolvency Opinion which may be relied upon by Lender, in connection with the Rating Agencies Loan reflecting any equity transfer consummated in accordance with this Section 5.2.10(d).
(e) No Transfer of the Property and their respective counsel, successors assumption of the Loan shall occur during the period that is sixty (60) days prior to and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, sixty (60) days after a Securitization. Otherwise, Lender’s consent to Transfers of the Rating Agencies;
Property and assumption of the Loan (iiia “Permitted Assumption”) at the time shall not be unreasonably withheld provided that Lender receives sixty (60) days prior written notice of such Transfer and no Event of Default has occurred and is continuing, and further provided that the following additional requirements are satisfied:
(i) Borrower shall pay Lender a transfer fee equal to one-half of one percent (0.50%) of the outstanding principal balance of the Loan at the time of the first such Permitted Assumption and one percent (1.0%) of the outstanding principal balance of the Loan at the time of each such Permitted Assumption thereafter;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(viii) Borrower shall pay, or cause to be paid, to Lender its pay any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs actually incurred in connection with such sale Transfer (including, without limitation, Lender’s reasonable counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or conveyance; andTransferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Property, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Permitted Assumption;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents which accrue from and after the date of the Transfer in a manner reasonably satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance reasonably satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened in connection writing against Transferee, Transferee’s Principals or Related Entities which is not reasonably acceptable to Lender. Prior to the Securitization, Lender shall have performed searches and/or received other diligence such that Lender is in compliance with Lender’s then current “know your customer” requirements. After the Securitization, Lender shall have received acceptable OFAC Searches with respect to Transferee and any Transfer as direct or indirect owner of Transferee (either itself or collectively with its Affiliates) that will own a result of which Sponsor will not own at least 5110% of the or greater equity interests in Borrower and control, interest (directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented Transferee after giving effect to such Transfer Permitted Assumption and acceptable litigation searches with respect Transferee and any direct or indirect owner of Transferee (Beither itself or collectively with its Affiliates) Borrower shall pay to Lender that will own a loan assumption fee of 150% of the then outstanding principal amount of the Loan.or greater equity interest (directly or indirectly) in Transferee;
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners in owning the Collateral in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the other obligations of Borrower set forth in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Collateral so as to ensure that, should Borrower (or any other party that is liable for the Debt, whether as a primary obligor or as a guarantor thereof) default in the repayment of the Debt or performance of the other obligations of Borrower set forth in the Loan Documents, Lender can recover the Debt by a sale of the Collateral. Notwithstanding anything contained in this Agreement to the contrary and notwithstanding that certain Transfers are permitted herein and notwithstanding that certain Sales or Pledges are excluded from being Transfers pursuant to Section 5.2.10(d) below, Canadian Trust shall at all times own 100% of the interests of Canadian Mortgage Borrower.
(b) Without the prior written consent of LenderLender and except for (a) Permitted Encumbrances (with respect to the Mortgage Loan Collateral), (b) the release of any Individual Property by the applicable Mortgage Loan Party in accordance with Section 2.5, and except (c) to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property Collateral or the Mortgage Loan Collateral or any direct part of the foregoing or indirect any legal or beneficial interest therein, in the foregoing or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lessee, any Restricted Party other than (A) the Operating Lease, (B) pursuant to (I) Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, 5.1.20 and (CII) the Room License Agreementsoccupancy agreements with hotel guests, and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the applicable Collateral or any part thereof or Mortgage Borrower or any other Mortgage Loan Party agrees to sell the applicable Mortgage Loan Collateral or any other Mortgage Loan Collateral or any part of the foregoing, in each case for a pledgeprice to be paid in installments; (ii) with the exception of the Operating Lease, hypothecationan agreement by Mortgage Borrower or Property Owner leasing all or a substantial part of any Individual Property for other than actual occupancy by a space tenant thereunder or a sale, creation assignment or other transfer of, or the grant of a security interest in, Mortgage Borrower’s, Operating Lessee’s or Property Owner’s or any other Mortgage Loan Party’s (as applicable) right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of this Section 5.2.10, the following shall not be deemed to be a Transfer:
(i) A Public Sale; provided, that (A) if after giving effect to any such Public Sale, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in Borrower a Restricted Party is permitted provided owned by any Person and its Affiliates that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not owned less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
forty-nine percent (ii49%) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests interest in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% such Restricted Party as of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by reasonably acceptable to Lender, and while the Loan is securitized and Securities therein are outstanding, the Approved Rating Agencies, (B) while the Loan is securitized and Securities therein are outstanding, Lender shall have received a Rating Agency Confirmation from each of the Approved Rating Agencies and their respective counsel, successors and assigns, with respect to such Public Sale, (C) (1) no Individual Borrower shall fail to be a Special Purpose Entity by reason of such Public Sale and (2) no Mortgage Loan Party shall fail to be a Special Purpose Entity (as defined in the proposed transfer Mortgage Loan Agreement) by reason of such Public Sale, (D) for so long as the Loan shall remain outstanding, no Sale or salePledge of any direct interest in Mortgage Borrower or any other Mortgage Loan Party pledged as a portion of the Collateral shall be permitted, which (E) intentionally omitted, (F) for so long as the Mezzanine B Loan shall remain outstanding, no Sale or Pledge of any direct interests in Borrower pledged as a portion of the Mezzanine B Collateral shall be permitted in connection with a Public Sale, (G) for so long as the Mezzanine C Loan shall remain outstanding, no Sale or Pledge of any direct interests in Mezzanine B Borrower pledged as a portion of the Mezzanine C Collateral shall be permitted in connection with a Public Sale, (H) for so long as the Mortgage Loan or any Mezzanine Loan shall remain outstanding, (i) no pledge or other encumbrance of any direct interests in any Restricted Pledge Party shall be permitted (except as otherwise permitted pursuant to the Mortgage Loan Documents or Mezzanine Loan Documents), provided, that a pledge of the direct ownership interests in the most upper-tier Restricted Pledge Party shall be permitted if such pledge directly or indirectly secures indebtedness that is also directly or indirectly secured by substantial assets other than the Collateral; provided, further that the provisions of this subclause (H) shall not apply to any ownership interests issued pursuant to the Management Incentive Compensation Plan in accordance with the provisions of Section 5.2.10(d)(v) below, and (ii) no Restricted Pledge Party shall issue preferred equity that has the characteristics of mezzanine debt (such as a fixed maturity date, regular payments of interest, a fixed rate of return and rights of the equity holder to demand repayment of its investment), and (I) immediately after giving effect to such Public Sale, the Debt Yield shall equal or exceed thirteen percent (13%).
(ii) The Sale or Pledge, in one or a series of transactions, of the direct or indirect equity interests in Borrower or direct or indirect equity interests in any Restricted Party; provided, that, (A) after giving effect to such Sale or Pledge, one or more of Guarantor (or Affiliate thereof) or any constituent member of Guarantor (or Affiliate thereof) individually, or collectively, in the aggregate (x) shall own not less than twenty-five percent (25%) of the direct or indirect legal and beneficial interests in Borrower (on an unencumbered and look-through basis) and (y) shall Control Borrower, (B) Lender shall receive notice of any Sale or Pledge described in this Section 5.2.10(d)(ii) not less than thirty (30) days following the consummation thereof (but the failure to deliver any such notice shall not cause the applicable Sale or Pledge to be a Transfer and shall not constitute an Event of Default unless such failure continues for ten (10) Business Days following notice of such failure from Lender), (C) for so long as the Loan is outstanding, no Sale or Pledge of any direct interest in Mortgage Borrower or other Mortgage Loan Party pledged as a portion of the Collateral shall be permitted, (D) intentionally omitted, (E) for so long as the Mezzanine B Loan shall remain outstanding, no such Sale or Pledge of any direct interests in Borrower pledged as a portion of the Mezzanine B Collateral shall be permitted, (F) for so long as the Mezzanine C Loan shall remain outstanding, no Sale or Pledge of any direct interests in Mezzanine B Borrower pledged as a portion of the Mezzanine C Collateral shall be permitted, (G) for so long as the Mortgage Loan or any Mezzanine Loan shall remain outstanding, (i) no pledge or other encumbrance of any direct interests in any Restricted Pledge Party shall be permitted (except as otherwise permitted pursuant to the Mortgage Loan Documents or the Mezzanine Loan Documents, as applicable), and except that a pledge of the direct ownership interests in the most upper-tier Restricted Pledge Party shall be permitted if such pledge directly or indirectly secures indebtedness that is also directly or indirectly secured by substantial assets other than the Collateral; provided, that the provisions of this subclause (G) shall not apply to any ownership interests issued pursuant to the Management Incentive Compensation Plan in accordance with the provisions of Section 5.2.10(d)(v) below, and (ii) no Restricted Pledge Party shall issue preferred equity that has the characteristics of mezzanine debt (such as a fixed maturity date, regular payments of interest, a fixed rate of return and rights of the equity holder to demand repayment of its investment), and (H)
(1) no Individual Borrower shall fail to be a Special Purpose Entity by reason of such Sale or Pledge and (2) no Mortgage Loan Party shall fail to be a Special Purpose Entity (as defined in the Mortgage Loan Agreement) by reason of such Sale or Pledge. If after giving effect to any such Sale or Pledge, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitizationwhile the Loan is securitized and Securities therein are outstanding, the Approved Rating Agencies;.
(iii) at Any Transfer (however structured) of any direct or indirect legal or beneficial interests in any Public Vehicle, including a Public Vehicle that exists on the time date hereof or a Public Vehicle which acquires a direct or indirect legal or beneficial interest in Borrower after the Closing Date in accordance with the terms of such Transfer no Event of Default has occurred and is continuing;this Section 5.2.10.
(iv) following such Any Transfer the property manager (however structured) of the Property must be a Qualified Manager;any legal or beneficial interests in any Guarantor or any constituent member of any Guarantor.
(v) ifAny Transfer of any legal or beneficial interests in ESH Hospitality Holdings LLC (or its successors or assigns) pursuant to the Management Incentive Compensation Plan, after giving effect and any subsequent Transfer of any such interests once Transferred pursuant to such TransferManagement Incentive Compensation Plan; provided, Sponsor does not own at least 51% that Transfers pursuant the Management Incentive Compensation Plan shall in no event exceed more than ten percent (10%) of the equity legal or beneficial interests in Borrower and control BorrowerESH Hospitality Holdings, LLC (or its successors or assigns) in the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securitiesaggregate.
(vi) A Sale or Pledge made by Other Mezzanine Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including secure the Other Mezzanine Loans in accordance with the Other Mezzanine Loan Documents and any fees due to the Rating Agencies) Transfer made in connection with such sale or conveyance; andthe exercise of remedies by an Other Mezzanine Lender pursuant to the Other Mezzanine Loan Documents.
(vii) in connection with Without limiting any Transfer as a result other rights of which Sponsor will not own at least 51% Borrower under this Agreement or the other Loan Documents, any one or more of the Transfers, steps or actions contemplated by Exhibit C hereto, including, without limitation, any actual or deemed statutory conversion, merger, consolidation, reorganization or transfer of equity interests in Borrower and controlor assets of ESH Hospitality Holdings LLC, directly ESH Hospitality, ▇▇ ▇▇▇ Investors, LLC, or indirectly, Borrower, Borrower shall give Extended Stay or cause to be given written notice to Lender any subsidiary of the proposed Transfer not later than fifteen (15) days prior theretoforegoing entities, which notice including any Operating Lessee shall be permitted; provided, that the applicable conditions set forth the name of the Person to which the interest below are satisfied (in Borrower is to be transferredeach case, identify the proposed transferee and set forth the date the Transfer is expected to be effective and a “Restructuring”):
(A) Lender In connection with an Asset Transfer:
I. The applicable Operating Lessee Holdco shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% assume all of the then outstanding principal amount obligations of the Loan.applicable Existing Operating Lessee under the Mortgage Loan Documents subject to the Lien of the Security Instruments pursuant to an assumption agreement and other documentation in form and substance reasonably satisfactory to Mortgage Lender;
II. Intentionally omitted;
Appears in 1 contract
Transfers. (a) Borrowers acknowledge that Lender has examined and relied on the experience of Borrowers and their direct and indirect members in owning and operating the Collateral and Mortgage Borrowers in agreeing to make the Loan, and will continue to rely on Borrowers’ ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Additionally, Borrowers acknowledge that Lender has examined and relied on the experience of Mortgage Borrowers and their general partners, members, principals and (if any Mortgage Borrower is a trust) beneficial owners, as applicable, in owning and operating properties such as the Properties and in owning intellectual property such as the IP, in agreeing to make the Loan, and will continue to rely on Mortgage Borrowers’ ownership of the Properties and the IP as a means of maintaining the value of the Properties and the IP and, therefore, indirectly the value of the Collateral, as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrowers acknowledge that Lender has a valid interest in maintaining the value of the Collateral so as to ensure that, should Borrowers default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Collateral.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower Borrowers shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyTransfer Restricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, license, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the any Property or any direct part thereof or indirect any legal or beneficial interest therein, or any IP or any part thereof or any legal or beneficial interest therein, or the Collateral or any part thereof or any legal or beneficial interest therein; or (ii) permit a Sale or Pledge of a direct or indirect any interest in Borrower any Transfer Restricted Party (any of the actions in the foregoing clauses (i) or Operating Lessee(ii), a “Transfer”), other than than, notwithstanding anything to the contrary contained in this Section 5.2.10:
(A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.205.1.20 hereof;
(B) the pledge of the membership interests in each Mortgage Borrower as collateral for the Loan and, if applicable, the exercise of remedies by Lender including, without limitation, any Transfer of all or a portion of such membership interests in connection with a foreclosure, strict foreclosure, public or private sale or transfer in lieu of foreclosure under the Loan Documents, provided that any such exercise of remedies is performed in accordance with and subject to the conditions and restrictions set forth in the Intercreditor Agreement and as a condition precedent to any foreclosure, strict foreclosure, public or private sale or transfer in lieu of foreclosure of such membership interests the Lender shall pay to Mortgage Lender a transfer fee in an amount equal to 1.00% of the sum of the Reduced Acquisition Loan Outstanding Principal Balance and the Construction Loan Outstanding Principal Balance;
(C) the Room License Agreementspledge of the membership interests in Borrower as collateral for the Second Mezzanine Loan and, if applicable, the exercise of remedies by Second Mezzanine Lender, including, without limitation, any Transfer of all or a portion of such membership interests in connection with a foreclosure, strict foreclosure, public or private sale or transfer in lieu of foreclosure under the Second Mezzanine Loan Documents, provided that any such exercise of remedies is performed in accordance with and subject to the conditions and restrictions set forth in the Intercreditor Agreement and as a condition precedent to any foreclosure, strict foreclosure, public or private sale or transfer in lieu of foreclosure of such membership interests the Second Mezzanine Lender shall pay to Mortgage Lender a transfer fee in an amount equal to 1.00% of the sum of the Reduced Acquisition Loan Outstanding Principal Balance and the Construction Loan Outstanding Principal Balance;
(D) Permitted Transfers.
(b) Notwithstanding the foregoingpledge of the membership interests in each Second Mezzanine Borrower as collateral for the Third Mezzanine Loan and, if applicable, the exercise of remedies by Third Mezzanine Lender, including, without limitation, any Transfer of all or a portion of such membership interests in connection with a foreclosure, strict foreclosure, public or private sale or conveyance by Borrower transfer in lieu of foreclosure under the Property Third Mezzanine Loan Documents, provided that any such exercise of remedies is performed in accordance with and subject to the lien conditions and restrictions set forth in the Intercreditor Agreement and as a condition precedent to any foreclosure, strict foreclosure, public or private sale or transfer in lieu of foreclosure of such membership interests the Third Mezzanine Lender shall pay to Mortgage Lender a transfer fee in an amount equal to 1.00% of the sum of the Reduced Acquisition Loan Outstanding Principal Balance and the Construction Loan Outstanding Principal Balance;
(E) any Release Parcel Sale or an IP Sale, in each instance in accordance with the applicable provisions of Section 2.5 of the Mortgage Loan Agreement;
(but not F) Intentionally Deleted;
(G) any other mortgage, lien IP License or other encumbrance Adjacent Property IP License granted in accordance with the provisions of Section 5.1.26 hereof;
(other than H) the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of DefaultPermitted IP Encumbrances;
(iiI) the Person to whom issuance of new stock in, the Property is sold merger or conveyed (consolidation of, and/or the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents Sale or Pledge of the Transferee are reasonably acceptable to Lender andstock in, after any Publicly Traded Entity who owns a Securitization, to the Rating Agenciesdirect or indirect ownership interest in any Transfer Restricted Party;
(iiiJ) if such sale the transfer of indirect ownership interests in any Mortgage Borrower in order to create one or conveyance occurs prior more new mezzanine borrowers for any New Mezzanine Loan as contemplated under the Mortgage Loan Agreement, including, without limitation, the transfers of ownership interests which were necessary to create Third Mezzanine Borrowers and the admission of a new member in each of Second Mezzanine Borrowers in connection with the creation of Third Mezzanine Borrowers; and
(K) the transfer by deed of any applicable Partial Release Parcel to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Subsidiary Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, subsequent transfer of all of the obligations membership interests held by Adjacent Borrower in such Subsidiary Transferee, in each instance in accordance with Section 2.5.1(f) of the Borrower thereafter arising or to be performed under this Mortgage Loan Agreement, the Mortgage and the other Loan Documents, subject; provided, however, to that in the provisions case of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager each of the Property must foregoing clauses (A) — (K), such Transfer shall only be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor permitted hereunder if it does not own at least 51% of the equity interests in Borrower and control Borrowerviolate any Legal Requirements, the Rating Agencies have confirmed that such sale including specifically, but without limitation, any Gaming Laws, or conveyance, in and of itself, will not result in suspend or terminate any liquor license applicable to a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyanceProperty.
(c) A Transfer (shall include, but not a pledgebe limited to, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale an installment sales agreement wherein any Borrower or conveyance occurs prior Mortgage Borrower, as applicable, agrees to sell a Securitization, Lender shall have consented to such sale Property or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lenderpart thereof, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a SecuritizationIP, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be Collateral or any part thereof for a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause price to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.paid in
Appears in 1 contract
Sources: First Mezzanine Loan Agreement (Hard Rock Hotel Holdings, LLC)
Transfers. (a) Borrower acknowledges that ▇▇▇▇▇▇ has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on ▇▇▇▇▇▇▇▇’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that ▇▇▇▇▇▇ has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, ▇▇▇▇▇▇ can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.9 or in connection with the release of any Individual Property in accordance with this Agreement, Borrower shall not, not and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options to purchase with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) enter into, or permit the Property to be subject to, any PACE Debt, (iii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than than, in each case, (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements5.1.18 and customary occupancy agreements with short-term hotel guests, and (DB) Permitted Transfers.
(b) Notwithstanding the foregoingTransfers and Permitted Indebtedness, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies Borrower dividing into two or more separate and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyancedistinct entities.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell any Individual Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of any Individual Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non managing membership interests or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of this Section 5.2.9, the following Transfers shall not require the consent of Lender or the payment of any transfer fee:
(i) The Sale or Pledge, in one or a series of transactions, of the direct or indirect equity interests in Borrower or direct or indirect interests in any Restricted Party (excluding the direct interests in Borrower is permitted provided that or Mezzanine Borrower, other than, for the following conditions are satisfied:
avoidance of doubt, a Permitted Transfer set forth in clause (im) if such sale or conveyance occurs prior to a Securitizationof the definition of “Permitted Transfer”); provided, Lender shall have consented to such sale or conveyancethat, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, (A) after giving effect to such Sale or Pledge (and in the Transfercase of a Sale or Pledge that is a pledge for security purposes, Sponsor owns any subsequent foreclosure thereon), (x)
(1) Borrower and Principal (on an unencumbered and look through basis) are indirectly Controlled and at least 50.1% owned by ▇▇▇▇▇ OP and/or MGP OP, provided that (I) with respect to ▇▇▇▇▇ OP, ▇▇▇▇▇ OP is owned, managed or Controlled by ▇▇▇▇▇, a Qualified Advisor, a Qualified Transferee or a Public Vehicle and (II) with respect to MGP OP, MGP OP is managed and Controlled by MGP, a Public Vehicle or a Qualified Transferee, or (y) following a Public Sale, a Public Vehicle or, following a Permitted Assumption, the applicable Qualified Transferee (1) shall own not less than fifty-one percent (51% %) of the economic and direct or indirect legal and beneficial interests in Borrower, Guarantor and Principal (on an unencumbered and look through basis) and (2) Control Borrower, Guarantor and Principal, (B) upon the written request of ▇▇▇▇▇▇, Borrower shall deliver to Lender notice of each sale described in this Section 5.2.9(d)(i) not less than ten (10) days following such request, (C) no Sale or Pledge of any direct interest in any Borrower, Mezzanine Borrower or Principal shall be permitted (other than, for the avoidance of doubt, a Permitted Transfer set forth in clause (m) of the definition of “Permitted Transfer”), (D) no Individual Borrower or Principal shall fail to be a Special Purpose Entity by reason of such Sale or Pledge, (E) for so long as the Loan shall remain outstanding (I) no pledge of any direct interests in any Restricted Pledge Party shall be permitted (other than pledges securing the Loan) and except that a pledge of the direct ownership interests in the most upper tier Restricted Pledge Party shall be permitted (other than pledges securing the Loan or Mezzanine Loan) if such pledge directly or indirectly secures indebtedness that is also directly or indirectly secured by substantial assets other than the Property and (II) no Restricted Pledge Party shall issue preferred equity that has the characteristics of mezzanine debt (such as a fixed maturity date, pledged ownership interests as security, regular payments of interest, a fixed rate of return and rights of the equity interests in Borrower holder to demand repayment of its investment), and controls(F) with respect to any transferee that, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer transfer, will hold a twenty percent (20%) or series of Transfers more greater direct or indirect interest in, or control, Borrower and/or Principal (and such transferee owned less than 49% twenty percent (20%) of the direct or indirect ownership interests interest in Borrower and/or Principal or did not control Borrower and/or Principal on the Closing Date), Lender shall be transferred receive satisfactory “know your customer” compliance screening searches consisting of a search and evaluation of (x) OFAC sanctions and other government required sanctions lists, (y) negative news screening of such holders, if any, associated with material derogatory information that could reasonably result in anti-money laundering risk to a Lender related to terrorist or other financial crimes and (z) such statutes and other information reasonably required by ▇▇▇▇▇▇ to confirm that Borrower and/or Principal, and such transferee is not an Embargoed Person individually (▇▇▇▇▇▇ agrees to use diligent and commercially reasonable efforts to complete such “know your customer” diligence in accordance with this clause (F) within fifteen (15) Business Days after ▇▇▇▇▇▇ receives the requested information necessary to conduct such diligence). If after giving effect to any such Sale or together with its Affiliates not owning at least Pledge, more than forty-nine percent (49% %) in the aggregate of the direct or indirect ownership interests in Borrower immediately prior to a Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Transfer (or Restricted Party as reflected in of the most recent Additional Insolvency Opinion delivered to Lender)Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, reasonably acceptable to Lender and the Approved Rating Agencies and their respective counsel, successors and assigns, with respect Agencies. Notwithstanding anything to the proposed transfer contrary contained in this Agreement, (x) no notice to, or saleconsent of, Lender shall be required in connection with any Sale or Pledge of direct or indirect interests in any Excluded Entity or by and among any Excluded Entity and (y) no Restricted Pledge Party (other than Borrower, Mezzanine Borrower or Principal) shall be restricted from any Sale or Pledge of its direct or indirect assets; provided such assets are not encumbered (or required to be encumbered) by the Loan or the Mezzanine Loan. In connection with a Sale or Pledge resulting in Guarantor no longer owning direct or indirect interests in Borrower, Principal or the Property, Guarantor shall be released as a guarantor under (I) the Guaranty for any acts occurring after such Sale or Pledge; provided that Borrower delivers a Substitute Guaranty from a Qualified Transferee that Controls Borrower or is under common Control with Borrower, which Substitute Guaranty shall include all liability for all such acts for which Guarantor was so released and (II) the Excess Cash Flow Guaranty, if any, provided that Borrower shall pay to Lender an amount equal to the Guaranteed Excess Cash Flow as of such date, which amounts shall be deposited by Lender into the Excess Cash Flow Reserve Account.
(ii) A Public Sale, provided, that (A) if after giving effect to any such Public Sale, more than forty-nine percent (49%) in the aggregate of the direct or indirect interests in any Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) of the direct or indirect interest in such Restricted Party as of the Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after to the extent a Securitizationrated Securitization has occurred, the Approved Rating Agencies;
; (iiiB) at the time none of Borrower or Principal shall fail to be a Special Purpose Entity by reason of such sale, (C) no Transfer of any direct interest in Borrower or Principal, or for so long as the Mezzanine Loan remains outstanding, in the Mezzanine Borrower shall be permitted, (D) no Event Restricted Pledge Party shall issue preferred equity that has the characteristics of Default has occurred mezzanine debt (such as a fixed maturity date, pledged ownership interests as security, regular payments of interest, a fixed rate of return and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% rights of the equity interests in Borrower and control Borrowerholder to demand repayment of its investment), the Rating Agencies shall have confirmed that such Transfer(E) with respect to any transferee that, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor such transfer, will not own at least 51% hold a twenty percent (20%) or greater direct or indirect interest in, or control, Borrower and/or Principal, (and such transferee owned less than twenty percent (20%) of the equity interests in Borrower and control, directly direct or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the indirect interest in Borrower is to be transferredand/or Principal, identify or did not control Borrower and/or Principal, on the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Closing Date), Lender shall have consented to such Transfer receive satisfactory “know your customer” compliance screening searches consisting of a search and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.evaluation of
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Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its management, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Properties in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Properties as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Properties so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Properties.
(b) Without the prior written consent of Lender, and except for (a) Permitted Encumbrances (with respect to the Properties), (b) the release of any Individual Property in accordance with Section 2.5, and (c) to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party to, do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the any Individual Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyanceRestricted Party.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell one or more Individual Properties or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of any Individual Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions are satisfied:creation or issuance of new legal or beneficial interests.
(id) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverNotwithstanding the provisions of this Section 5.2.10, Lender’s consent shall not be required ifin connection with (i) one or a series of Transfers, of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party or (ii) a Permitted Transfer; provided, however, no such Transfer shall result in the change of Control in a Restricted Party (Lender agreeing that any Transfer from Gramercy Sponsor or its wholly-owned Affiliates to G▇▇▇▇▇▇▇ Sponsor or its wholly-owned Affiliates and vice versa shall not, so long as the last sentence of this clause (d) is satisfied, constitute a change of Control in a Restricted Party), and as a condition to each such Transfer, (i) Lender shall receive not less than ten (10) days’ prior written notice of such proposed Transfer (provided that no advance notice shall be required with respect to (y) Transfers by Passive Owners which are not Affiliated with Guarantor or (z) Transfers by Passive Owners which are Affiliated with Guarantor solely by reason of being a director or officer of a Guarantor or a Person that is Affiliated with Guarantor) and (ii) such Transfer will not result in a default or event of default under any Ground Lease or the Master Lease, nor shall such Transfer cause, or give the Master Tenant the right to obtain, a reduction in the term of the Master Lease with respect to all or any portion of the Properties. If after giving effect to the any such Transfer, Sponsor owns not more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than 51% forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the equity interests in Closing Date, Borrower and controlsshall, directly or indirectly, Borrower;
no less than five (ii5) if as a result days prior to the effective date of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Transfer, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, and the Approved Rating Agencies;
. In addition, at all times, either Gramercy Sponsor, G▇▇▇▇▇▇▇ Sponsor, or both, must continue to (iii1) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Control Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in Guarantor and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi2) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and controlown, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen at least a fifty percent (1550%) days prior thereto, which notice shall set forth the name of the Person to which the legal and beneficial interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the LoanGuarantor.
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Transfers. (a) Borrower acknowledges that ▇▇▇▇▇▇ has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Properties in agreeing to make the Loan, and will continue to rely on ▇▇▇▇▇▇▇▇’s ownership of the Properties as a means of maintaining the value of the Properties as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that ▇▇▇▇▇▇ has a valid interest in maintaining the value of the Properties so as to ensure that, during the continuance of an Event of Default, Lender can recover the Debt by a sale of the Properties.
(b) Without the prior written consent of Lender▇▇▇▇▇▇, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the any Individual Property or any direct part thereof or indirect any legal or beneficial interest therein, (ii) enter into any PACE Loan or (iiiii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (each of the following, a “Permitted Transfer”) (A) the Operating LeaseDistribution (and any Transfers effectuated in connection therewith as disclosed to Lender in writing prior to closing), (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) Permitted Equity Transfers; provided, that any waiver or amendment by Guarantor of the Room License Agreements9.8% ownership limitation set forth in the Guarantor’s declaration of trust shall require ▇▇▇▇▇▇’s prior written consent to the extent that both (I) an Ownership Change Limitation would reasonably be expected to exist immediately following a Transfer of the maximum interest in Guarantor permitted by such waiver or amendment, and (DII) Permitted Transfers.
such Transfer would reasonably be expected to increase the percentage ownership of 5% shareholders of Mezzanine Borrower (bincluding any “public group” as defined in Section 1.382-2T(f)(13) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien Treasury regulations treated as such) for purposes of the Mortgage determining whether there is an Ownership Change Limitation (but not any other mortgageprovided that, lien or other encumbrance for purposes of (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the PropertyII)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities entitled to rely upon reasonably available information, including the Securities and obligations under the Loan Documents;
(vi) following such sale Exchange Commission Schedules 13D and 13G of Guarantor and any information or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) representations obtained in connection with the sale granting of such a waiver or conveyanceamendment, in determining whether any Transfer is reasonably expected to increase the percentage ownership of such 5% shareholders), (D) a Mezzanine Change of Control Event or any other exercise of remedies by Mezzanine Lender under the Mezzanine Loan (including a foreclosure of the Pledge Agreement (as defined in the Mezzanine Loan Agreement) or an assignment in lieu thereof), (E) the exercise of remedies by Lender under the Loan Documents (including a foreclosure of the Mortgage or any Pledge Agreement or an assignment or conveyance in lieu thereof), (F) a Condemnation, (G) the acquisition by Borrower of fee title to any PILOT Property in accordance with the terms and conditions of the applicable PILOT Lease and this Agreement, (H) the acquisition by Borrower of fee title to any Ground Lease Property in accordance with the terms and conditions of the applicable Ground Lease and this Agreement, (I) Permitted Encumbrances, and (J) Transfers of Individual Properties in connection with a release pursuant to Section 2.5.2 of this Agreement.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell one or more Individual Properties or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of any Individual Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, ▇▇▇▇▇▇▇▇’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, Division, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger, Division or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger, Division or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interest.
(d) If after giving effect to any Permitted Equity Transfer, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in Borrower is permitted provided Mezzanine Member are owned by any Person and its Affiliates that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not owned less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
forty-nine percent (ii49%) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests interest in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% Mezzanine Member as of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lendershall, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later less than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.ten
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of LenderLender and, to the extent that the Mezzanine Loan remains outstanding, the Mezzanine Lender in accordance with the Mezzanine Loan Agreement, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or any interest of Borrower in the Loan or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer shall include (but not i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of any Individual Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non managing membership interests or the creation or issuance of new non managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions are satisfied:creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(id) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverNotwithstanding the provisions of this Section 5.2.10, Lender’s consent shall not be required ifin connection with one or a series of Transfers, of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such Transfer shall result in the change of Control in a Restricted Party, and, to the extent that the Mezzanine Loan remains outstanding, no such Transfer shall occur without the prior written consent of Mezzanine Lender in accordance with the Mezzanine Loan Agreement, and as a condition to each such Transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed Transfer. If after giving effect to the any such Transfer, Sponsor owns not more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than 51% forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the equity interests Closing Date, Borrower shall, no less than thirty (30) days prior to the effective date of any such Transfer, deliver to Lender an Additional Insolvency Opinion acceptable to Lender and the Rating Agencies. Borrower shall pay any and all reasonable out-of-pocket costs and expenses incurred in connection with such Transfers (including Lender’s counsel fees and disbursements and any fees and expenses of the Rating Agencies).
(e) No Transfer of the Property (or any portion thereof) and assumption of the Loan shall occur during the period that is sixty (60) days prior to and sixty (60) days after a Securitization. Without limiting Lender’s discretion to approve or disapprove any request for a waiver of the prohibition against Transfers, Lender specifically reserves the right to condition its consent to any waiver of a prohibited Transfer upon satisfaction of the following minimum conditions:
(i) Borrower and controls, directly or indirectly, Borrowershall pay Lender a transfer fee equal to one percent (1%) of the outstanding principal balance of the Loan at the time of such transfer;
(ii) if Borrower shall pay any and all reasonable out-of-pocket costs incurred in connection with such Transfer (including Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or Transferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to each Individual Property, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Default or Event of Default shall otherwise occur as a result of any such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements, covenants and legal opinions reasonably required by Lender;
(x) If required by Lender, Transferee shall be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a requalification, reduction, downgrade or series of Transfers more than 49% withdrawal of the direct or indirect ownership interests ratings in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower effect immediately prior to such Transfer assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Prior to any release of Guarantor, one (1) or more substitute guarantors acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or execute a replacement guaranty and environmental indemnity reasonably satisfactory to Lender.
(xii) Borrower shall deliver, at its sole cost and expense, an endorsement to each Title Insurance Policy, as reflected modified by the assumption agreement, as a valid first lien on each Individual Property and naming the Transferee as owner of each Individual Property, which endorsement shall insure that, as of the date of the recording of the assumption agreement, each Individual Property shall not be subject to any additional exceptions or liens other than those contained in the most recent Additional Insolvency Opinion delivered Title Policies issued on the date hereof and the Permitted Encumbrances;
(xiii) Each Individual Property shall be managed by Qualified Manager pursuant to a Replacement Management Agreement;
(xiv) The Property meets all of the Lender)’s underwriting standards related to its financial condition, cash flow, operating income, physical condition, management and operation;
(xv) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion which reflecting such Transfer satisfactory in form and substance to Lender; and
(xvi) If the Mezzanine Loan remains outstanding, Mezzanine Lender has approved such Transfer.
(f) Notwithstanding any provision in this Section 5.2.10 to the contrary, limited partnership or membership interests, as applicable, in Borrower may be relied upon by transferred without Lender, ’s consent and without application of the Rating Agencies and their respective counsel, successors and assigns, fee set forth in Section 5.2.10(e)(i) so long as Mezzanine Lender’s prior approval has been obtained in accordance with respect the Mezzanine Loan Agreement (to the proposed transfer extent that the Mezzanine Loan remains outstanding) and: (i) among limited partners or salemembers, as applicable, of Borrower who are limited partners or members, as applicable, of Borrower as of the date of this Agreement (each a “Current Owner”), and (ii) to immediate family members (which Additional Insolvency Opinion shall be reasonably acceptable limited to Lender anda spouse, after a Securitizationparent, child and grandchild (each, an “Immediate Family Member”)), of any Current Owner or to trusts formed for the Rating Agencies;
(iii) at the time benefit of Immediate Family Members of such Transfer Current Owner for bona fide estate planning purposes (each, an “Additional Permitted Transfer”), provided each of the following conditions is satisfied: (A) no Event of Default has occurred and no event has occurred that with notice and/or the passage of time, or both, would constitute an Event of Default; (B) Lender has received Borrower’s notice of the Additional Permitted Transfer no less than 30 days prior to the commencement of such transfer; (C) no Indemnitor or Guarantor shall be released from any guaranty or indemnity agreement by virtue of the Additional Permitted Transfer; (D) Borrower shall be responsible for the costs and expenses of documenting the Additional Permitted Transfer; (E) Borrower shall reimburse Lender for all actual costs and expenses incurred by Lender in connection with the Additional Permitted Transfer, whether or not consummated; (F) once the Additional Permitted Transfer is continuing;
(iv) following such Transfer complete, the property manager persons with Control of Borrower and management of the Property must are the same persons who have such Control and management rights immediately prior to the Additional Permitted Transfer; (G) Borrower shall furnish Lender copies of any documentation executed in connection with the Additional Permitted Transfer promptly after execution thereof; (H) Borrower shall have delivered satisfactory evidence to Lender that, following the Additional Permitted Transfer, Borrower shall continue to comply with the provisions of Section 4.1.30 hereof; and (I) upon Lender’s request, delivery of an Additional Insolvency Opinion acceptable to Lender. Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer. Notwithstanding the foregoing, the foreclosure by Mezzanine Lender under the Mezzanine Loan of the interests pledged under the Mezzanine Pledge Agreement, subject in all respects to the Mezzanine Intercreditor Agreement, shall not be deemed to be a Qualified Manager;
Transfer in violation of this Section 5.2.10. Notwithstanding anything to the contrary contained in this Section 5.2.10, for so long as the Mezzanine Loan is outstanding, Mezzanine Borrower must at all times directly own one hundred percent (v100%) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.
Appears in 1 contract
Transfers. (a) Borrower and each other Loan Party acknowledge that Lender has examined and relied on the experience of Borrower and each other Loan Party and their general partners, members, principals and (if Borrower or such other Loan Party is a trust) beneficial owners in owning and operating properties and other assets such as the Properties, the other Mortgage Loan Collateral and the Collateral in agreeing to make the Loan, and will continue to rely on Borrower’s and the other Loan Party’s ownership of the Collateral and the Mortgage Loan Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the other obligations of Borrower as set forth in the Loan Documents. Borrower and the other Loan Parties acknowledge that Lender has a valid interest in maintaining the value of the Collateral and the Mortgage Loan Collateral so as to ensure that, should Borrower (or any other Loan Party that is liable for the Debt, whether as a primary obligor or as a guarantor thereof) default in the repayment of the Debt or performance of the other obligations of Borrower set forth in the Loan Documents, Lender can recover the Debt by a sale of the Collateral.
(b) Without the prior written consent of LenderLender and except for (a) Permitted Encumbrances, (b) the release of any Individual Property in accordance with Section 2.5 or Section 6.4 of the Mortgage Loan Agreement and Section 2.5 hereof, and except (c) to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower and the other Loan Parties shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property Collateral, the Mortgage Loan Transfer Collateral or any direct part thereof or indirect any legal or beneficial interest therein, in the foregoing or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lessee, any Restricted Party other than (A) the Operating Lease, (B) pursuant to (I) Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, 5.1.20 and (CII) the Room License Agreementsoccupancy agreements with hotel guests, and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyanceDebt.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower or any other Loan Party agrees to sell the applicable Collateral or any part thereof or Mortgage Borrower, Operating Lessee or any other Mortgage Loan Party agrees to sell the applicable Mortgage Loan Transfer Collateral or any part of the foregoing, in each case for a pledgeprice to be paid in installments; (ii) an agreement by Mortgage Borrower and/or Operating Lessee leasing all or a substantial part of any Individual Property for other than actual occupancy by a space tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Mortgage Borrower’s, Operating Lessee’s or any other Mortgage Loan Party’s (as applicable) right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of this Section 5.2.10, the following shall not be deemed to be a Transfer:
(i) A Permitted Transfer; provided, that, (A) after giving effect to such Permitted Transfer, BREP VII (1) shall own not less than fifty-one percent (51%) of the direct or indirect legal and beneficial interests in Borrower, any other Loan Party, Mortgage Borrower, Operating Lessee and any other Mortgage Loan Party (on an unencumbered and look-through basis and without regard to the Preferred Shares) and (2) shall Control Borrower, each other Loan Party, Mortgage Borrower, Operating Lessee and each other Mortgage Loan Party, (B) Lender shall receive notice of any Sale or Pledge described in this Section 5.2.10(d)(i) not less than thirty (30) days following the consummation thereof (but the failure to deliver any such notice shall not cause the applicable Permitted Transfer to be a Transfer and shall not constitute an Event of Default unless such failure continues for ten (10) Business Days following notice of such failure from Lender), (C) no Permitted Transfer of any direct interest in any Mortgage Loan Party pledged as a portion of the Collateral shall be permitted, (D) for so long as the Loan shall remain outstanding, no such Permitted Transfer of any direct interests in any Mortgage Loan Party shall be permitted, (E) for so long as the Mezzanine B Loan shall remain outstanding, no such Permitted Transfer of any direct interests in Borrower shall be permitted, (F) for so long as the Loan, the Mortgage Loan or the Mezzanine B Loan shall remain outstanding, (i) no pledge or other encumbrance) encumbrance of any direct interests in any Restricted Pledge Party shall be permitted (other than the pledges securing the Loan, the Mortgage Loan or the Mezzanine B Loan), and except that a pledge of the direct ownership interests in the most upper-tier Restricted Pledge Party shall be permitted if such pledge directly or indirectly secures indebtedness that is also directly or indirectly secured by substantial assets other than the Collateral and the Mortgage Loan Transfer Collateral; and (ii) no Restricted Pledge Party shall issue preferred equity that has the characteristics of mezzanine debt (such as a fixed maturity date, regular payments of interest, a fixed rate of return and rights of the equity holder to demand repayment of its investment), and (G) no Individual Borrower, other Loan Party, Mortgage Borrower, Operating Lessee or other Mortgage Loan Party shall fail to be a Special Purpose Entity by reason of such Sale or Pledge. If after giving effect to any such Permitted Transfer, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party (excluding any Restricted Party that no longer owns a direct or indirect interest in a Loan Party after such Transfer and excluding the Preferred Shares) are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party (excluding any Restricted Party that no longer owns a direct or indirect interest in a Loan Party after such Transfer and excluding the Preferred Shares) as of the Closing Date, Borrower is permitted provided that or such other Loan Party shall deliver to Lender an Additional Insolvency Opinion acceptable to Lender and the following conditions are satisfied:
(i) if such sale Approved Rating Agencies. Notwithstanding anything to the contrary contained in this Agreement, no notice to, or conveyance occurs prior to a Securitizationconsent of, Lender shall have consented to such sale be required in connection with any Permitted Transfer in any Excluded Entity.
(ii) A (x) Public Listing or conveyance, which consent shall not be unreasonably withheld(y) Public Sale; provided however, Lender’s consent shall not be required if, in the case of both (x) and (y) that (A) if after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer Public Listing or series of Transfers Public Sale, more than forty-nine percent (49% %) in the aggregate of the direct or indirect ownership interests in Borrower shall be transferred to a the Restricted Party are owned by any Person individually or together with and its Affiliates not owning at least that owned less than forty-nine percent (49% of the %) direct or indirect ownership interests interest in Borrower immediately prior to such Transfer (or Restricted Party as reflected in of the most recent Additional Insolvency Opinion delivered to Lender)Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender andand the Approved Rating Agencies, after (B) Lender shall have received a SecuritizationRating Agency Confirmation from each of the Approved Rating Agencies with respect to such Public Listing or Public Sale, (C) no Individual Borrower, other Loan Party, Mortgage Borrower, Operating Lessee or other Mortgage Loan Party shall fail to be a Special Purpose Entity by reason of such Public Listing or Public Sale, (D) for so long as the Loan shall remain outstanding, no Sale or Pledge of any direct interest in any Borrower, any other Loan Party, Mortgage Borrower, Operating Lessee or other Mortgage Loan Party shall be permitted in connection with such Public Listing or Public Sale, (E) for so long as the Loan shall remain outstanding, no Sale or Pledge of the direct interests in any Mortgage Loan Party shall be permitted in connection with such Public Listing or Public Sale, (F) for so long as the Mezzanine B Loan shall remain outstanding, no Sale or Pledge of any direct interests in Borrower shall be permitted in connection such Public Listing or Public Sale, and (G) for so long as the Loan, the Rating Agencies;Mortgage Loan or the Mezzanine B Loan shall remain outstanding, (i) no pledge or other encumbrance of any direct interests in any Restricted Pledge Party shall be permitted (other than the pledges securing the Loan, the Mortgage Loan or the Mezzanine B Loan) and (ii) no Restricted Pledge Party shall issue preferred equity interests (except as otherwise permitted pursuant to the Loan Documents, Mortgage Loan Documents or Mezzanine B Loan Documents, as applicable).
(iii) at the time The Sale or Pledge, in one or a series of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager transactions, of the Property must be a Qualified Manager;
direct or indirect equity interests in Borrower and any other Loan Party or direct or indirect interests in any Restricted Party; provided, that, (vA) if, after giving effect to such TransferSale or Pledge, Sponsor does BREP VII (1) shall own not own at least less than fifty-one percent (51% %) of the direct or indirect legal and beneficial interests in Borrower, any other Loan Party, Mortgage Borrower, Operating Lessee and any other Mortgage Loan Party (on an unencumbered and look-through basis and without regard to the Preferred Shares) and (2) shall Control Borrower, each other Loan Party, Mortgage Borrower, Operating Lessee and each other Mortgage Loan Party, (B) Lender shall receive notice of any Sale or Pledge described in this Section 5.2.10(d)(iii) not less than thirty (30) days following the consummation thereof (but the failure to deliver any such notice shall not cause the applicable Sale or Pledge to be a Transfer and shall not constitute an Event of Default unless such failure continues for ten (10) Business Days following notice of such failure from Lender), (C) no Sale or Pledge of any direct interest in any Mortgage Loan Party pledged as a portion of the Collateral shall be permitted, (D) for so long as the Loan shall remain outstanding, no such Sale or Pledge of any direct interests in any Mortgage Loan Party shall be permitted, (E) for so long as the Mezzanine B Loan shall remain outstanding, no such Sale or Pledge of any direct interests in Mezzanine A Borrower shall be permitted, (F) for so long as the Loan, the Mortgage Loan or the Mezzanine B Loan shall remain outstanding, (i) no pledge or other encumbrance of any direct interests in any Restricted Pledge Party shall be permitted (other than the pledges securing the Loan, the Mortgage Loan or the Mezzanine B Loan), and except that a pledge of the direct ownership interests in the most upper-tier Restricted Pledge Party shall be permitted if such pledge directly or indirectly secures indebtedness that is also directly or indirectly secured by substantial assets other than the Collateral; and (ii) no Restricted Pledge Party shall issue preferred equity that has the characteristics of mezzanine debt (such as a fixed maturity date, regular payments of interest, a fixed rate of return and rights of the equity holder to demand repayment of its investment), and (G) no Individual Borrower, other Loan Party, Mortgage Borrower, Operating Lessee or other Mortgage Loan Party shall fail to be a Special Purpose Entity by reason of such Sale or Pledge. If after giving effect to any such Sale or Pledge, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in Borrower and control Borrower, the Rating Agencies shall have confirmed a Restricted Party (excluding any Restricted Party that such Transfer, in and of itself, will not result no longer owns a direct or indirect interest in a downgrade, qualification Loan Party after such Transfer and excluding the Preferred Shares) are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or withdrawal indirect interest in such Restricted Party (excluding any Restricted Party that no longer owns a direct or indirect interest in a Loan Party after such Transfer and excluding the Preferred Shares) as of the then current ratings assigned Closing Date, Borrower or such other Loan Party shall deliver to Lender an Additional Insolvency Opinion acceptable to Lender and the Approved Rating Agencies. Notwithstanding anything to the Securitiescontrary contained in this Agreement, no notice to, or consent of, Lender shall be required in connection with any Sale or Pledge of direct or indirect interests in any Excluded Entity.
(iv) Any Transfer (however structured) of any legal or beneficial interests in any Guarantor or any constituent member of any Guarantor.
(v) A Pledge made by Mezzanine B Borrower to secure the Mezzanine B Loan in accordance with the Mezzanine B Loan Documents.
(vi) Any Transfer of an indirect non-controlling interest in Mezzanine B Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; andBREP VII AIV.
(vii) Any Transfer (however structured) of any direct or indirect legal or beneficial interests in connection with any Transfer Public Vehicle, including a Public Vehicle that exists as a result of which Sponsor will not own at least 51% of the equity date hereof, or a Public Vehicle which acquires the direct or indirect legal or beneficial interests in Borrower and control, directly or indirectly, Borrower, Borrower any other Loan Party, Mortgage Borrower, Operating Lessee and each other Mortgage Loan Party after the Closing Date in accordance with the terms of this Section 5.2.10.
(e) If, in the case of a Transfer described in Section 5.2.10(d)(ii), the Public Vehicle in question satisfies the Public Vehicle Eligibility Requirements, Guarantor shall give or be released from the Guaranty for all liability accruing after the date of such Transfer provided that such Public Vehicle shall execute a replacement guaranty in form and substance the same as the Guaranty covering all liability accruing after the date of such Transfer (but not any which may have accrued prior thereto). If, in the case of a Transfer described in Section 5.2.10(d)(ii), the Public Vehicle in question does not meet the Public Vehicle Eligibility Requirements at the time of consummation of such Transfer, (i) Guarantor shall cause to be given written notice a Person reasonably acceptable to Lender execute a replacement guaranty in form and substance the same as the Guaranty covering all liability accruing after the date of the proposed such Transfer (but not later than fifteen (15) days any which may have accrued prior thereto), which notice (ii) Guarantor shall set forth be released from the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth Guaranty for all liability accruing after the date the Transfer is expected to be effective of such Transfer, and (Aiii) at such time as the Public Vehicle in question satisfies the Public Vehicle Eligibility Requirements and executes a replacement guaranty in form and substance the same as the Guaranty covering all liability accruing after the date of such execution (but not any which may have accrued prior thereto), the replacement guarantor referred to in clause (i) above shall be released from the Guaranty for all liability accruing after such time.
(f) Lender shall have consented not be required to such demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon a Transfer and (B) Borrower in violation of this Agreement. This provision shall pay apply to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.every Trans
Appears in 1 contract
Transfers. (a) Without Borrower acknowledges that Lender has examined and relied on the creditworthiness and experience of the Restricted Parties, as applicable, in owning and operating properties such as the Property in agreeing to make the loan secured by the Security Instrument, and that Lender will continue to rely such Restricted Parties’ direct or indirect ownership and/or operation of the Property as a means of maintaining the value of the Property as security for repayment of the Debt. Borrower shall not without Lender’s prior written consent of Lender(not to be unreasonably withheld, conditioned or delayed) and except to the extent as otherwise set forth expressly provided in this Section 5.2.10 and Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): 5.2.10: (i) sell, assign, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, transfer or otherwise dispose of its legal or beneficial interests in the Property or any part thereof other than pursuant to Leases permitted under, and entered into in accordance with, Section 5.1.20 hereof, and/or with respect to other Permitted Encumbrances, (ii) permit any owner, directly or indirectly, of an ownership interest the Property, to transfer or dispose of such interest, whether by transfer of stock or other interest in a Restricted Party, or otherwise, (iii) [intentionally omitted], (iv) mortgage, hypothecate or otherwise encumber or grant a security interest in the Property or any part thereof, (v) sell, assign, convey, transfer, mortgage, encumber, grant a security interest in, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect ownership interest thereinin any Restricted Party, or permit any Restricted Party that owns an interest in another Restricted Party to do the same, or (iivi) permit file a Sale declaration of condominium with respect to the Property (any of the foregoing transactions, a “Transfer”). Notwithstanding the foregoing, for purposes hereof, a “Transfer” shall not include Permitted Transfers. Further notwithstanding the foregoing, for purposes of determining recourse liability pursuant to Section 9.3, a “Transfer” shall not include any of the following (1) the granting of, amendment of, extension or Pledge renewal of, or any other action taken with respect to any Permitted Encumbrance (without limiting Borrower’s obligations with respect to any Permitted Encumbrances pursuant to the terms and provisions of a direct this Agreement and the other Loan Documents), (2) the settlement of any claim, dispute, litigation or indirect interest in regulatory proceeding (without limiting Borrower’s obligations with respect to any such settlements pursuant to the terms and provisions of this Agreement and the other Loan Documents), (3) the expenditure of funds by Borrower or Operating Lesseeany other Restricted Party (without limiting Borrower’s obligations with respect to any such expenditures pursuant to the terms and provisions of this Agreement and the other Loan Documents), or (4) the disposition or removal of personal property owned or leased by Major Tenant to the extent not prohibited under the Major Tenant Lease, provided, however, the foregoing shall not preclude a determination that the foregoing result in recourse liability for reasons other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfersbeing deemed a Transfer.
(b) Notwithstanding the foregoingSection 5.2.10(a), Lender’s consent shall not be required in connection with (1) one or a sale or conveyance by Borrower series of Transfers, of up to forty-nine percent (49%) of the Property subject stock, limited partnership interests, membership interests or beneficial interests (as the case may be) in a Restricted Party, (2) one or a series of Transfers of the stock in Sponsor, (3) one or a series of Transfers of the limited partnership interests in Operating Partnership and (4) one or a series of Transfers of the direct membership interests owned as of the Closing Date by CF Loyalty Holdings, LLC in Borrower to the lien Operating Partnership; provided, however, (x) after giving effect to each such Transfer described in clauses (1), (2), (3) and (4), Borrower and Guarantor each shall be Controlled, directly or indirectly, by CFLP (or in connection with any Transfer pursuant to clause (4) above resulting in Operating Partnership acquiring ninety-nine percent (99%) of the Mortgage membership interests owned by CF Loyalty Holdings, LLC in Borrower, Sponsor), and Borrower shall continue to comply with the representations, warranties and covenants under Sections 4.1.30 (but Special Purpose Entity), 4.1.34 (Investment Company Act), 4.1.35 (Embargoed Persons), 5.1.23 (Embargoed Persons) and 5.2.9 (ERISA) and upon reasonable request of Lender, from time to time, Borrower will reaffirm its ongoing compliance with the same; and (y) as a condition to any Transfers described in clause (4) above, upon Operating Partnership acquiring ninety-nine percent (99%) of the membership interest owned by CF Loyalty Holdings, LLC in Borrower, (A) Sponsor shall have assumed all of the obligations of Guarantor under the Loan Documents and become the replacement Guarantor in accordance with the terms of the Loan Documents, (B) Borrower shall have delivered prior written notice to Lender of such Transfer and (C) the Operating Partnership shall have become the managing member of Borrower in accordance with the terms of Borrower’s operating agreement and Operating Partnership shall Control Borrower and the Property. In addition, (i) after giving effect to each such Transfer, Guarantor (or a Qualified Replacement Guarantor) shall Control the Borrower or be under common Control with the Borrower, and (ii) if such Transfer is a Material Owner Transfer, Borrower shall deliver with respect to each transferee, prior to such transfer and at Borrower’s sole cost and expense, “know your customer” searches confirming compliance with the sections referenced above, and verifying the transferee has not been convicted of a felony, is not then, nor has it been in the prior seven (7) years, the subject of a Bankruptcy Action. If a Transfer described in this clause (b) involves a Transfer of a direct interest in Borrower, no such Transfer shall be permitted during the period commencing thirty (30) days prior to a Securitization and ending thirty (30) days after a Securitization.
(c) Notwithstanding Section 5.2.10(a), Lender’s consent shall not be required in connection with a Transfer of the direct or indirect interests in Borrower; provided, however, that after giving effect to such Transfer, Borrower and Guarantor each shall be Controlled, directly or indirectly, by CFLP, and after giving effect to such Transfer, Borrower shall continue to comply with the representations, warranties and covenants under Sections 4.1.30 (Special Purpose Entity), 4.1.34 (Investment Company Act), 4.1.35 (Embargoed Persons), 5.1.23 (Embargoed Persons) and 5.2.9 (ERISA). Upon reasonable request of Lender, from time to time, Borrower will reaffirm its ongoing compliance with the same. In addition, (i) Guarantor or a Qualified Replacement Guarantor at all times must continue to Control the Borrower, or be under common Control with the entity that Controls Borrower, and (ii) if such Transfer is a Material Owner Transfer, Borrower shall deliver with respect to each transferee, prior to such transfer and at Borrower’s sole cost and expense, “know your customer” searches confirming compliance with the sections referenced above, and verifying the transferee has not been convicted of a felony, is not then, nor has it been in the prior seven (7) years, the subject of a Bankruptcy Action. If a Transfer described in this clause (c) involves a Transfer of a direct interest in Borrower, no such Transfer shall be permitted during the period commencing thirty (30) days prior to a Securitization and ending thirty (30) days after a Securitization;
(d) Notwithstanding Section 5.2.10(a), at any other mortgage, lien or other encumbrance (time other than during the Permitted Encumbrances period commencing thirty (30) days prior to a Securitization and Room License Agreements hereafter entered into ending thirty (30) days after a Securitization, Borrower may undertake one or more Transfers of the entire Property to an unrelated third party transferee (or a Transfer of more than fifty percent (50%) of the direct or indirect beneficial interests in Borrower to an unrelated third party transferee in a single Transfer, to the ordinary course extent such Transfer is not otherwise compliant with clause (c) above) and assumption of operating the Property)entire Loan, provided that Lender receives thirty (30) is permitted days’ prior written notice of such Transfer and further provided that the following conditions additional requirements are satisfied:
(i) the proposed transferee of the Property shall be a Special Purpose Entity (the “Transferee”) which at the time of such transfer will be in compliance with, and must be able to satisfy all of, the representations, warranties and covenants contained in Section 4.1.30, Section 4.1.35, Section 5.1.23 and Section 5.2.9 and which shall have assumed in writing (subject to the terms of Section 9.3 hereof) and agreed to comply with all the terms, covenants and conditions set forth in this Agreement and the other Loan Documents, expressly including, without limitation the representations, warranties and covenants contained in Section 4.1.30, Section 4.1.35, Section 5.1.1 and Section 5.1.23 hereof;
(ii) if the Loan is held by a REMIC Trust, Borrower shall deliver confirmation in writing from the Rating Agencies that such proposed Transfer will not cause a downgrading, withdrawal, reduction or qualification of the ratings in effect immediately prior to such Transfer for the Securities, or any class thereof, issued in connection with a Securitization which are then outstanding;
(iii) Transferee and Transferee’s Principals shall, as of the date of such transfer, be (or be Controlled by) a Person satisfying the requirements for a Qualified Replacement Guarantor, Qualified Fund Manager or Qualified Real Estate Investor, or otherwise be reasonably acceptable to Lender;
(iv) Lender shall have received with respect to Transferee, prior to such Transfer and at Borrower’s sole cost and expense, “know your customer” searches confirming compliance with the sections referenced in clause (i) above, and verifying the transferee has not been convicted of a felony, is not then, nor has it been in the prior seven (7) years, the subject of a Bankruptcy Action;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer, unless otherwise reasonably acceptable to Lender;
(vi) if the Transfer involves Transfer of the Property, Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner reasonably satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance reasonably satisfactory to Lender;
(vii) there shall be no material litigation or regulatory action pending or threatened, in writing, against Transferee or Controlling Transferee’s Principals which in Lender’s reasonable judgment would likely result in a material adverse change in the financial condition, operations or business of Transferee or Guarantor;
(viii) unless the Property is self-managed, the Property shall be managed by a Qualified Manager pursuant to a replacement Management Agreement;
(ix) Transferee and Controlling Transferee’s Principals shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(x) no Event of Default shall have occurred and be continuing and such sale no Default or conveyance shall not result in an Event of DefaultDefault shall otherwise occur as a result of such Transfer;
(iixi) if the Person Transfer involves a Transfer of the Property, Borrower shall deliver, at its sole cost and expense, an endorsement to whom the Title Insurance Policy insuring the Security Instrument, as modified by the assumption agreement, as a valid first lien on the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents naming Transferee as owner of the Transferee are reasonably acceptable to Lender andfee estate (or leasehold estate, after a Securitization, to as applicable) of the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyanceProperty, which consent endorsement shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lenderinsure that, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all the recording of the obligations of the Borrower thereafter arising or to be performed under this Agreementassumption agreement, the Mortgage Property shall not be subject to any additional exceptions or liens other than those contained in the Title Insurance Policy issued on the date hereof and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan DocumentsPermitted Encumbrances relating thereto;
(vixii) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan[Reserved];
(viiixiii) if, after giving effect The proposed Transfer shall be permitted under the terms of each Major Lease and Borrower shall have assigned each Lease to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower Transferee and control Borrower, the Rating Agencies Transferee shall have confirmed that such sale or conveyanceassumed, in and writing, all obligations of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrowerlandlord under each Lease;
(iixiv) if as a result of any such The proposed Transfer or series of Transfers more than 49% shall be permitted under the terms of the direct CRA and the Transferee shall have obtained an assumption agreement (in the form attached as an exhibit to the CRA agreement or indirect ownership interests such other form as may be required by the City at such time) from the City in Borrower shall be transferred to a Person individually or together accordance with its Affiliates not owning at least 49% the terms of the direct or indirect ownership interests in Borrower immediately prior to such Transfer CRA Agreement;
(or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)xv) Transferee, Borrower at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion opinions regarding existence, authority and enforceability, which opinions may be relied upon by Lender, the Rating Agencies and their respective counsel, successors agents and assigns, representatives with respect to the proposed transfer or saletransaction;
(xvi) Transferee shall deliver (1) all organizational documentation reasonably requested by Lender, which Additional Insolvency Opinion shall be evidence due formation and existence, and shall comply with Section 4.1.30, and (2) all certificates, agreements or covenants reasonably required by Lender, provided that, in each case, the same do not increase its obligations, decrease its rights, or otherwise adversely affect Borrower, any other Affiliate of Borrower or Transferee, in each case, except to a de minimis extent;
(xvii) Prior to any release of Guarantor, if such a release is requested by Borrower, one (1) or more Qualified Replacement Guarantors (or substitute guarantors reasonably acceptable to Lender) shall have assumed all of the liabilities and obligations first arising thereafter of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or execute a replacement guaranty and environmental indemnity reasonably satisfactory to Lender and, after a Securitization(and upon the execution of the same, the Rating Agenciesthen-existing Guarantor shall be released from any and all liabilities under the Guaranty and Environmental Indemnity with respect to events first occurring thereafter);
(iiixviii) at the time Borrower shall have paid an assumption fee equal to (A) one-quarter of such Transfer no Event of Default has occurred and is continuing;
one percent (iv0.25%) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to then Outstanding Principal Balance in connection with the first such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal (B) one percent (1.0%) of the then current ratings assigned to Outstanding Principal Balance in connection with the Securitiesany subsequent Transfer; and
(vixix) Borrower shall pay, pay (or cause to be paid, to Lender its ) (A) any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs actually incurred by Lender in connection with such sale Transfer (including, without limitation, Lender’s reasonable counsel fees and disbursements), (B) all recording fees, title insurance premiums and mortgage and intangible taxes and (C) all the fees and expenses of the Rating Agencies (if any) pursuant to clause (ii) above. With respect to matters above in this Section 5.2.10(d) wherein Lender’s approval, satisfaction or conveyance; andconsent is required, it is agreed that Lender shall not condition its approval, satisfaction or consent upon the payment of any other fee, and Borrower shall not otherwise be required to pay any additional fee or expense to Lender, except as specifically provided in clauses (xvii) and (xviii).
(viie) [Reserved.]
(f) After any Transfer permitted hereunder or consented to by Lender, Borrower shall, upon request, provide Lender an updated organizational chart certified by Borrower as true, correct and complete.
(g) [Reserved.]
(h) Notwithstanding the provisions of Section 5.2.10(a) above, Lender’s consent shall not be required in connection with any Transfer as a result of which Sponsor will not own at least 51% pledge of the equity direct or indirect interests in Sponsor by an Upstream Borrower and controlas part of a financing secured by all or substantially all of the assets of such Upstream Borrower (such financing, directly together with any renewal or indirectlyreplacement financing, an “Upstream Loan”).
(i) Borrower, Borrower shall give or cause to be given written notice to Lender without the consent of Lender, may grant easements, restrictions, covenants, reservations and right of way in the proposed Transfer not later than fifteen (15) days prior theretoordinary course of business for access, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.par
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Transfers. (a) Borrowers acknowledge that Lender has examined and relied on the experience of Borrowers and their direct and indirect members in owning and operating the Collateral and Mortgage Borrowers in agreeing to make the Loan, and will continue to rely on Borrowers’ ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Additionally, Borrowers acknowledge that Lender has examined and relied on the experience of Mortgage Borrowers and their general partners, members, principals and (if any Mortgage Borrower is a trust) beneficial owners, as applicable, in owning and operating properties such as the Properties and in owning intellectual property such as the IP, in agreeing to make the Loan, and will continue to rely on Mortgage Borrowers’ ownership of the Properties and the IP as a means of maintaining the value of the Properties and the IP and, therefore, indirectly the value of the Collateral, as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrowers acknowledge that Lender has a valid interest in maintaining the value of the Collateral so as to ensure that, should Borrowers default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Collateral.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower Borrowers shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyTransfer Restricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, license, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the any Property or any direct part thereof or indirect any legal or beneficial interest therein, or any IP or any part thereof or any legal or beneficial interest therein, or the Collateral or any part thereof or any legal or beneficial interest therein; or (ii) permit a Sale or Pledge of a direct or indirect any interest in Borrower any Transfer Restricted Party (any of the actions in the foregoing clauses (i) or Operating Lessee(ii), a “Transfer”), other than than, notwithstanding anything to the contrary contained in this Section 5.2.10:
(A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.205.1.20 hereof;
(B) the pledge of the membership interests in each Mortgage Borrower as collateral for the First Mezzanine Loan and, if applicable, the exercise of remedies by First Mezzanine Lender including, without limitation, any Transfer of all or a portion of such membership interests in connection with a foreclosure, strict foreclosure, public or private sale or transfer in lieu of foreclosure under the First Mezzanine Loan Documents, provided that any such exercise of remedies is performed in accordance with and subject to the conditions and restrictions set forth in the Intercreditor Agreement and as a condition precedent to any foreclosure, strict foreclosure, public or private sale or transfer in lieu of foreclosure of such membership interests the First Mezzanine Lender shall pay to Mortgage Lender a transfer fee in an amount equal to 1.00% of the sum of the Reduced Acquisition Loan Outstanding Principal Balance and the Construction Loan Outstanding Principal Balance;
(C) the Room License Agreementspledge of the membership interests in each First Mezzanine Borrower as collateral for the Second Mezzanine Loan and, if applicable, the exercise of remedies by Second Mezzanine Lender, including, without limitation, any Transfer of all or a portion of such membership interests in connection with a foreclosure, strict foreclosure, public or private sale or transfer in lieu of foreclosure under the Second Mezzanine Loan Documents, provided that any such exercise of remedies is performed in accordance with and subject to the conditions and restrictions set forth in the Intercreditor Agreement and as a condition precedent to any foreclosure, strict foreclosure, public or private sale or transfer in lieu of foreclosure of such membership interests the Second Mezzanine Lender shall pay to Mortgage Lender a transfer fee in an amount equal to 1.00% of the sum of the Reduced Acquisition Loan Outstanding Principal Balance and the Construction Loan Outstanding Principal Balance;
(D) Permitted Transfers.
(b) Notwithstanding the foregoingpledge of the membership interests in each Second Mezzanine Borrower as collateral for the Loan and, if applicable, the exercise of remedies by Lender, including, without limitation, any Transfer of all or a portion of such membership interests in connection with a foreclosure, strict foreclosure, public or private sale or conveyance by Borrower transfer in lieu of foreclosure under the Property Loan Documents, provided that any such exercise of remedies is performed in accordance with and subject to the lien conditions and restrictions set forth in the Intercreditor Agreement and as a condition precedent to any foreclosure, strict foreclosure, public or private sale or transfer in lieu of foreclosure of such membership interests the Lender shall pay to Mortgage Lender a transfer fee in an amount equal to 1.00% of the sum of the Reduced Acquisition Loan Outstanding Principal Balance and the Construction Loan Outstanding Principal Balance;
(E) any Release Parcel Sale or an IP Sale, in each instance in accordance with the applicable provisions of Section 2.5 of the Mortgage Loan Agreement;
(but not F) Intentionally Deleted;
(G) any other mortgage, lien IP License or other encumbrance Adjacent Property IP License granted in accordance with the provisions of Section 5.1.26 hereof;
(other than H) the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of DefaultPermitted IP Encumbrances;
(iiI) the Person to whom issuance of new stock in, the Property is sold merger or conveyed (consolidation of, and/or the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents Sale or Pledge of the Transferee are reasonably acceptable to Lender andstock in, after any Publicly Traded Entity who owns a Securitization, to the Rating Agenciesdirect or indirect ownership interest in any Transfer Restricted Party;
(iiiJ) if such sale the transfer of indirect ownership interests in any Mortgage Borrower in order to create one or conveyance occurs prior more new mezzanine borrowers for any New Mezzanine Loan as contemplated under the Mortgage Loan Agreement; and
(K) the transfer by deed of any applicable Partial Release Parcel to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Subsidiary Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, subsequent transfer of all of the obligations membership interests held by Adjacent Borrower in such Subsidiary Transferee, in each instance in accordance with Section 2.5.1(f) of the Borrower thereafter arising or to be performed under this Mortgage Loan Agreement, the Mortgage and the other Loan Documents, subject; provided, however, to that in the provisions case of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager each of the Property must foregoing clauses (A) — (K), such Transfer shall only be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor permitted hereunder if it does not own at least 51% of the equity interests in Borrower and control Borrowerviolate any Legal Requirements, the Rating Agencies have confirmed that such sale including specifically, but without limitation, any Gaming Laws, or conveyance, in and of itself, will not result in suspend or terminate any liquor license applicable to a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyanceProperty.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein any Borrower or Mortgage Borrower, as applicable, agrees to sell a pledgeProperty or any part thereof, hypothecationthe IP, creation the Collateral or any part thereof for a price to be paid in installments; (ii) an agreement by any Mortgage Borrower leasing all or a substantial part of a Property for other than actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, any Mortgage Borrower’s right, title and interest in and to any Leases or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheldRents; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time if a Transfer Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such Transfer no Event corporation’s stock or the creation or issuance of Default has occurred and is continuing;
new stock; (iv) following such if a Transfer Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the property manager change, removal, resignation, admission or addition of a general partner or the Sale or Pledge of the Property must be a Qualified Manager;
general partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) ifif a Transfer Restricted Party is a limited liability company, after giving effect any merger or consolidation or the change, removal, resignation, admission or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such Transfermembership interest, Sponsor does not own at least 51% or the Sale or Pledge of non-managing or managing membership interests or the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and creation or issuance of itself, will not result in a downgrade, qualification new non-managing or withdrawal of the then current ratings assigned to the Securities
managing membership interests; (vi) Borrower shall payif a Transfer Restricted Party is a trust or nominee trust, any merger, consolidation or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) Sale or Pledge of the legal or beneficial interest in connection with such sale a Transfer Restricted Party or conveyancethe creation or issuance of new legal or beneficial interests; and
(vii) the removal or the resignation of any Manager (including, without limitation, an Affiliated Manager) other than in connection accordance with the Mortgage Loan Agreement and Section 5.1.22 hereof; or (viii) any Transfer as a result deed-in-lieu or consensual foreclosure relating to any Property with or for the benefit of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly Mortgage Lender or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany Affiliate thereof.
Appears in 1 contract
Sources: Third Mezzanine Loan Agreement (Hard Rock Hotel Holdings, LLC)
Transfers. (a) Borrower acknowledges that Le▇▇▇▇ ▇as examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Bo▇▇▇▇▇▇’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Le▇▇▇▇ ▇as a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Le▇▇▇▇ ▇an recover the Debt by a sale of the Property. 84 0123905.0782082 4863-1270-3898v11
(b) Without the prior written consent of LenderLe▇▇▇▇, not to be unreasonably withheld, delayed or conditioned, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof (except in connection with any Condemnation) or indirect any legal or beneficial interest therein, therein or any interest of Borrower in the Loan or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 hereof and (DB) Permitted Transfers.
. For the avoidance of doubt, in no event shall the Transfers described in clauses (a), (b), (c), (d), (g), (h) Notwithstanding the foregoing, a sale or conveyance by Borrower (j) of the Property subject to the lien definition of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the “Permitted Encumbrances and Room License Agreements hereafter entered into Transfers” set forth in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which Section 1.1 hereof require consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitizationexcept as otherwise expressly required hereunder, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or notice to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer shall include (but not i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of any Individual Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Bo▇▇▇▇▇▇’s right, title and interest in and to any Leases or other encumbranceany Rents or any Property Documents; (iii) if a Restricted Party is a corporation, any merger, consolidation division into two (2) or more legal entities or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation, division into two (2) or more legal entities or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation, division into two (2) or more legal entities or the change, removal, resignation or addition of a managing member or nonmember manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of nonmanaging membership interests or the creation or issuance of new nonmanaging membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation, division into two (2) or more legal entities or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; (vii) the removal or the resignation of the Manager (including an Affiliated Manager) other than in accordance with Section 5.1.22 hereof; or (viii) Borrower is permitted provided that the following conditions are satisfied:entering into or affirmatively consenting to any ▇▇▇▇ ▇▇▇▇. 0123905.0782082 4863-1270-3898v11
(id) if such sale or conveyance occurs prior to a SecuritizationNotwithstanding the provisions of this Section 5.2.10, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, LenderLe▇▇▇▇’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly connection with one or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers Transfers, of not more than forty-nine percent (49% %) of the direct or indirect ownership interests in a Restricted Party; provided, however, no such Transfer shall result in the change of Control in Borrower shall be transferred or Guarantor, and as a condition to a Person individually each such Transfer that results in the transferee owning ten percent (10%) or together with its Affiliates not owning at least 49% more of the direct or indirect ownership interests in a Borrower immediately (which such transferee did not own 10% or more of the direct or indirect ownership interests in a Borrower prior to such Transfer Transfer), (or as reflected in the most recent Additional Insolvency Opinion delivered i) Borrower shall provide to Lender, not less than ten (10) days prior to such transfer, the name and identity of each proposed transferee, together with the names of its controlling principals, the social security number (if applicable) or employee identification number (if applicable) of such transferee and controlling principals (if applicable), Borrower and such transferee’s and, if applicable, controlling principal’s home address or principal place of business, and home or business telephone number (if applicable) and (ii) Lender shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, have received Satisfactory Search Results with respect to the proposed transferee and such controlling principals, if applicable; provided, further, however, the foregoing clause (i) and (ii) shall not be applicable in connection with any transfer (or pledging) of stock or membership interests in any publicly-held corporation or other publicly-held entity (in each case) which is listed on the New York Stock Exchange, the NASDAQ Global Select Market or another nationally-recognized stock exchange, or transfer or saleissuance of securities of the REIT provided that such securities are listed on the New York Stock Exchange, which Additional Insolvency Opinion the NASDAQ Global Select Market or another nationally recognized stock exchange. Borrower shall be reasonably acceptable to Lender and, after a Securitization, pay any and all reasonable out-of-pocket costs and expenses incurred in connection with such Transfers (including Lender’s counsel fees and disbursements and any fees and expenses of the Rating Agencies). In addition, at all times (other than in connection with a Mezzanine Control Event), Guarantor (or a Qualified Equity Holder) must continue to Control Borrower, and own, directly or indirectly, at least a 51% legal and beneficial interest in Borrower.
(e) Notwithstanding anything to the contrary contained in this Section 5.2.10, Lender shall not unreasonably withhold its consent to a sale, assignment, or other transfer of the Property (or such Property remaining after any releases of Individual Properties pursuant to Section 2.5.2 hereof) and the assumption of the Loan by the applicable Transferee provided that (i) Lender receives prior written notice of such transfer, (ii) no Event of Default has occurred and is continuing both at the time such notice is given and as of the closing date of such transaction, (iii) no such sale, assignment or other transfer of the Property shall occur on or prior to the Permitted Prepayment Date (or prior to the date that is ninety (90) days following the Permitted Prepayment Date, if Lender delivers a written notice to Borrower on or prior to the Permitted Prepayment Date stating that a Securitization is imminently pending), and (iv) the following conditions precedent are satisfied (or waived in writing by ▇▇▇▇▇▇ or Servicer):
(i) Borrower shall pay Lender a transfer fee equal to one percent (1.0%) of the Outstanding Principal Balance of the Loan for each such Transfer resulting in the assumption of the Loan;
(ii) Borrower shall pay any and all reasonable out-of-pocket costs incurred in connection with such Transfer (including ▇▇▇▇▇▇’s outside counsel reasonable fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) at The proposed transferee (the time “Transferee”) or Transferee’s Principals (directly or indirectly) must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to each Individual Property (or deliver evidence that they will engage a Qualified Manager to manage each Individual Property), which expertise shall be reasonably determined by ▇▇▇▇▇▇; 86 0123905.0782082 4863-1270-3898v11
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender; with the understanding that if Transferee and Transferee’s Principals would otherwise satisfy the Qualified Replacement Guarantor or Qualified Equity Holder Thresholds, as the case may be, then this clause (iv) shall be deemed satisfied;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner reasonably satisfactory to Lender in all respects, including by entering into an assumption agreement in form and substance reasonably satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened in writing against Transferee, Transferee’s Principals or Related Entities which is not acceptable to Lender in its reasonable discretion and Lender shall have performed searches and/or received other diligence such that Lender is in compliance with ▇▇▇▇▇▇’s then current “know your customer” requirements and shall have received Satisfactory Search Results for any owner of Transferee which will own a 10% or greater equity interest (directly or indirectly) in Borrower after giving effect to such transfer;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not acceptable to Lender in its reasonable discretion;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by ▇▇▇▇▇▇, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements, covenants and legal opinions reasonably required by ▇▇▇▇▇▇;
(x) If required by Lender (and if a Securitization has occurred), Transferee shall be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a requalification, reduction, downgrade or withdrawal of the ratings in effect immediately prior to such assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or execute a replacement guaranty and environmental indemnity reasonably satisfactory to Lender; with the understanding that a substitute guarantor that qualifies as a Qualified Replacement Guarantor will be acceptable to Lender. 87 0123905.0782082 4863-1270-3898v11
(xii) Borrower shall deliver, at its sole cost and expense, an endorsement (or equivalent) to each Title Insurance Policy insuring the Security Instruments, as modified by the assumption agreement, as valid first liens on each Individual Property and naming the Transferee as owner of each Individual Property, which endorsement shall insure that each Individual Property shall not be subject to any additional exceptions or liens other than those contained in the Title Policies issued on the date hereof and the Permitted Encumbrances; and
(xiii) Each Individual Property shall be managed by Qualified Manager pursuant to a Replacement Management Agreement.
(f) Notwithstanding any provision in this Section 5.2.10 to the contrary, direct or indirect limited partnership, membership or other equity interests, as applicable, in a Restricted Party may be transferred without Lender’s consent and without application of the fee set forth in Section 5.2.10(e)(i): (i) among direct or indirect limited partners or members or other equity owners, as applicable, of a Restricted Party who are direct or indirect limited partners or members or other equity owners, as applicable, of a Restricted Party as of the date of this Agreement (each a “Current Owner”), and (ii) to immediate family members (which shall be limited to a spouse, parent, child and grandchild (each, an “Immediate Family Member”)), of any Current Owner or to trusts formed for the benefit of Immediate Family Members of such Current Owner for bona fide estate planning purposes (each, an “Additional Permitted Transfer”), provided each of the following conditions is satisfied: (A) no Event of Default has occurred and is continuing;
; (ivB) following such Transfer the property manager Lender has received Borrower’s notice of the Property must Additional Permitted Transfer no less than 30 days prior to the commencement of such transfer, if required by clause (J) below; (C) no Guarantor shall be a Qualified Manager;
released from any guaranty or indemnity agreement by virtue of the Additional Permitted Transfer; (vD) if, after giving effect to such Borrower shall be responsible for the costs and expenses of documenting the Additional Permitted Transfer; (E) Borrower shall reimburse Lender for all actual costs and expenses incurred by Lender in connection with the Additional Permitted Transfer, Sponsor does whether or not own at least 51% of consummated; (F) the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, Additional Permitted Transfer will not result in a downgradechange of Control of Borrower; (G) upon ▇▇▇▇▇▇’s request, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to furnish Lender its reasonable out-of-pocket expenses (including copies of any fees due to the Rating Agencies) documentation executed in connection with the Additional Permitted Transfer promptly after execution thereof; (H) the Additional Permitted Transfer shall not cause Borrower to violate any of the provisions of Section 4.1.30 hereof and, upon ▇▇▇▇▇▇’s request, Borrower shall deliver a written certification of such sale or conveyancecompliance to Lender; and
(viiI) intentionally omitted; and (J) in connection with any Additional Permitted Transfer as that results in the transferee owning ten percent (10%) of the direct or indirect ownership interests in a result of Borrower (which Sponsor will such transferee did not own at least 5110% or more of the equity direct or indirect ownership interests in a Borrower and controlprior to such Transfer), directly or indirectly, Borrower, (i) Borrower shall give or cause provide to be given written notice to Lender of the proposed Transfer Lender, not later less than fifteen thirty (1530) days prior theretoto such transfer, which notice shall set forth the name and identity of each proposed transferee, together with the Person names of its controlling principals, the social security number or employee identification number of such transferee and controlling principals, and such transferee’s and controlling principal’s home address or principal place of business, and home or business telephone number and (ii) Lender shall have received Satisfactory Search Results with respect to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth such controlling principals. 88 0123905.0782082 4863-1270-3898v11
(g) A Transfer (a “Qualified Equityholder Transfer”) of direct or indirect ownership interests in Borrower to a Qualified Equityholder resulting in a change in Control of Borrower may occur at any time and from time-to-time without Lender’s consent, so long as no Event of Default has occurred and is continuing and the date the Transfer is expected to be effective and following conditions are satisfied (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.or waive
Appears in 1 contract
Transfers. 132
(a) Without Except as expressly permitted in this Section 5.16, no Transfer (including any pledge of the direct or indirect interests in any Borrower) other than a Permitted Encumbrance or a Permitted Equity Transfer shall be made without Agent’s prior written consent; provided, however, that a Transfer under clause (a)(i) of the definition thereof of a material portion of the Collateral or under clause (b) of the definition thereof, shall require the consent of Lenderall Lenders. Nothing herein shall restrict Borrowers or any owner of Borrowers from entering into a purchase and sale agreement for the Property (or direct or indirect equity interests in any entity owning the Property) so long as (i) such purchase and sale agreement does not obligate Borrowers to perform any work or other obligations other than delivery of title to the Property (or such ownership interests), and except to (ii) the extent otherwise purchase price set forth in this Section 5.2.10 such purchase and Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest sale agreement will result in Borrower or Operating Lessee net sales proceeds in an amount sufficient to do any of repay the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect interest therein, or (ii) permit a Sale or Pledge of a direct or indirect interest Loan in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfersfull.
(b) Notwithstanding If certain fixtures or other personal property located at or on the foregoingMortgaged Property are required, in accordance with the applicable Plans and Specifications, to be removed or replaced in connection with the Phase Zero Renovation Project and/or PIP Project, upon the purchase and receipt of the applicable fixtures or personal property, Borrower may sell or otherwise dispose of the fixtures or other personal property being replaced, free from the Lien of the Security Documents; provided, however, any proceeds from the sale thereof shall be promptly deposited into the Clearing Account. In addition, Borrowers may, without the prior consent of Agent, in the Ordinary Course of Business in compliance with the operating standards set forth in Section 5.2, sell or otherwise dispose of, free from the Lien of the Security Documents, any fixtures or other personal property located at or on the Mortgaged Property (except all or any portion of the buildings or other permanent structures built upon the Land) to the extent such property is being replaced, has become old, inadequate, obsolete, worn out or unfit or unadapted for use in the operation of the Mortgaged Property, cannot be advantageously used in the efficient operation of the Mortgaged Property or the removal and/or replacement of which would result in a cost savings, provided, that, in the case of each such sale or conveyance by Borrower other disposition of the Property subject to the lien of the Mortgage (but not any other mortgage, lien such fixtures or other encumbrance personal property (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyanceother disposition of such property which is contained in, or is part of, the existing Improvements as of the date hereof so long as such property is not intended or required to be used for or in connection with the development of the Project), Borrowers shall (unless the failure to do so would not reduce the value of the Mortgaged Property by more than a de minimis extent) substitute such property with other property acquired by Borrowers free and clear of all liens, encumbrances and rights of others except Permitted Encumbrances, of a value and utility substantially equal to the property sold or otherwise disposed of when new and such substitute property is subject to a first, perfected security interest in favor of Agent.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in So long as no Default or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing, Borrowers may, without the prior consent of Agent or any Lender, (i) make immaterial Transfers of portions of the Mortgaged Property to Governmental Authorities for dedication or public use, and (ii) grant easements, restrictions, covenants, reservations and rights-of-way in the Ordinary Course of Business for access, water and sewer lines, telephone or other fiber optic or other data transmission lines, electric lines or other utilities or for other similar purposes, provided that no such Transfer, conveyance or encumbrance set forth in the foregoing clauses (i) or (ii) shall (x) materially impair the utility and operation of the Mortgaged Property, (y) materially impair the ability to sell the Mortgaged Property or lease any portion of the Mortgaged Property (other than the portion to be transferred) or (z) reasonably be expected to, or does, have a Material Adverse Effect. In connection with any Transfer permitted pursuant to this subsection (c), Agent shall execute and deliver any instrument reasonably necessary or appropriate, in the case of the Transfers referred to in clause (i) above, to release the portion of the Mortgaged Property affected by such Taking or such Transfer from the Lien of the Mortgage or, in the case of clause (ii) above, to subordinate the Lien of the Mortgage to such easements, restrictions, covenants, reservations and rights-of-way or other similar grants upon receipt by Agent of: 49289660
(i) fifteen (15) days’ prior written notice thereof;
(ii) a copy of the instrument or instruments of Transfer;
(iii) a certificate in form and substance reasonably satisfactory to Agent stating (A) with respect to any Transfer, the consideration, if any, being paid for the Transfer, which consideration shall be applied to the Outstanding Principal Balance in accordance with Section 5.14 and (B) that such Transfer does not have a Material Adverse Effect; and
(iv) following such Transfer the property manager reimbursement of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% all of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its Agent’s reasonable out-of-pocket costs and expenses (including any reasonable attorneys’ fees due to the Rating Agenciesand disbursements) incurred in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the LoanTransfer.
Appears in 1 contract
Sources: Loan Agreement (Creative Media & Community Trust Corp)
Transfers. (a) Borrower acknowledges that each Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning collateral such as the Collateral in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that each Lender has a valid interest in maintaining the value of the Collateral so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, each Lender can recover the Debt by a sale of the Property.
(a) Without the prior written consent of LenderAdministrative Agent, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property Property, the Collateral or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) enter into any PACE Loan, (iii) permit a Sale or Pledge of a direct or indirect an interest in Borrower any Restricted Party, (iv) permit a Sale or Operating Lessee, Pledge of the CPLV Lease or any interest therein or (v) permit a Sale or Pledge of any interest in CPLV Tenant or CPLV Tenant’s leasehold interest in the Property other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (B) Permitted Transfers (including Permitted Encumbrances), (C) pursuant to customary short-term occupancy agreements with the Room License AgreementsCPLV Tenant or short-term hotel guests, and or (D) Permitted Transfersa Transfer of a portion of the Property to a Governmental Authority in connection with a Condemnation of such portion of the Property in accordance with Section 6.3 hereof.
(b) Notwithstanding A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the foregoingCollateral or any part thereof or Mortgage Borrower agrees to sell the Property or any part thereof, in each case, for a sale price to be paid in installments; (ii) an agreement by Mortgage Borrower leasing all or conveyance by Borrower a substantial part of the Property subject for other than actual occupancy by a space Tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Mortgage Borrower’s right, title and interest in and to the lien of the Mortgage (but not CPLV Lease or any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
CPLV Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such sale corporation’s stock or conveyance occurs prior to the creation or issuance of new stock; (iv) if a SecuritizationRestricted Party is a limited or general partnership or joint venture, Lender shall have consented any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such sale partnership interest, or conveyancethe Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, which any merger or consolidation or the change, removal, resignation or addition of a managing member or non‑member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non‑managing membership interests or the creation or issuance of new non‑managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the Manager other than in accordance with Section 5.1.22 hereof.
(c) Notwithstanding the provisions of this Section 5.2.10(a), Administrative Agent’s consent shall not be unreasonably withheld;
required in connection with (i) one or a series of Transfers (except for a Pledge) of (x) not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party or (y) the indirect equity interests in Mezzanine B Borrower by any Person that owns less than forty-nine percent (49%) of the economic and legal beneficial interests in, and does not Control, any of Mortgage Borrower, Mortgage Principal, Principal, any Mezzanine Borrower or Guarantor, (ii) any transfer of any direct or indirect legal or beneficial interests in the REIT, so long as it is a Public Vehicle, (iii) the cancellation, surrender, disposition, issuance, sale, grant, or Transfer of the operating partnership units of Guarantor, so long as the REIT continues to Control Guarantor and own directly or indirectly not less than 51% of the legal and beneficial interest in Guarantor, (iv) Lender has received an Additional Insolvency Opinion which the pledge of or grant of a security interest in the direct or indirect equity interests in Mortgage Borrower as security for the Loan or the other Mezzanine Loans, (v) the exercise by any Mezzanine Collateral Agent (on behalf of the applicable Mezzanine Lender) of any rights or remedies such Mezzanine Collateral Agent may be relied upon by Lender, have under the Rating Agencies and their respective successors and assigns, applicable Mezzanine Loan Documents with respect to the Transferee pledge and/or security interest referred to in the foregoing clause (iv), and its applicable affiliates(vi) the Mezzanine C Equity Conversion; provided, which Additional Insolvency Opinion shall be reasonably acceptable however, that with respect to Lender or, after a Securitization, the Rating Agencies;
each such Transfer (other than under clause (v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
clause (vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
above), (viiA) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own (x) REIT shall continue to Control Mortgage Borrower, Borrower and Guarantor, (y) REIT shall continue to own, directly or indirectly, at least fifty-one percent (51% %) in the aggregate of the equity interests legal and beneficial interest in Mortgage Borrower and control Borrower and (z) Guarantor shall continue to own, directly or indirectly, at least fifty-one percent (51%) in the aggregate of the legal and beneficial interest in Mortgage Borrower and Borrower; (B) as a condition to each such Transfer, Administrative Agent shall receive not less than thirty (30) days prior written notice of such proposed Transfer (except with respect to any Transfer pursuant to clause (i) or clause (iii) to the Rating Agencies have confirmed extent that any such sale or conveyance, in and of itself, Transfer will not result in the transferee (either itself or collectively with its Affiliates) after giving effect to such Transfer owning a downgrade, qualification 10% or withdrawal greater equity interest (directly or indirectly) in Borrower (that did not own a 10% or greater interest therein as of the then current ratings assigned Closing Date), clause (ii) if the REIT is a Public Vehicle, clause (iv) or clause (v) above); (C) the representations set forth in Section 4.1.9 hereof shall continue to the Securities; and
(ix) Borrower pays Lender’s reasonable costs be true and expenses (including correct after giving effect to any fees due such Transfer and except with respect to the Rating Agencies) in connection with the sale or conveyance.
(c) A any Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interest in a Public Vehicle or pursuant to clause (v), transferee and its principals are not an Embargoed Person and the representations set forth in Section 4.1.35 hereof shall continue to be true and correct after giving effect to any such Transfer; (D) such Transfer shall be at Borrower’s sole cost and expense; (E) if after giving effect to any such Transfer, more than forty-nine percent (49%) in the aggregate of direct interests in Borrower is owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct interest in Borrower as of the Closing Date, Borrower shall, no less than ten (10) days prior to the effective date of any such Transfer, deliver to Administrative Agent an Additional Insolvency Opinion reasonably acceptable to Administrative Agent; (F) to the extent that any Transfer (other than any Transfer of shares in a Restricted Party that is a Public Vehicle and except with respect to any Transfer pursuant to clauses (iv) or (v)) will result in the transferee (either itself or collectively with its Affiliates) after giving effect to such Transfer owning a 10% or greater equity interest (directly or indirectly) in Borrower (that did not own a 10% or greater interest therein as of the Closing Date), Administrative Agent shall (x) have the right to perform any searches and/or reasonably request other diligence from Borrower to permit Administrative Agent and each Lender to comply with its then current “know your customer” requirements, including, but not limited to Patriot Act and OFAC searches and (y) receive Satisfactory Search Results, at Borrower’s cost and expense, as a condition precedent to such Transfer; (G) for so long as the Loan shall remain outstanding, no such Transfer or encumbrance of any direct interests in Mortgage Borrower shall be permitted provided (other than the pledges and security interests securing the Loan and any Transfer pursuant to clause (v)); (H) for so long as the Mezzanine B Loan shall remain outstanding, no such Transfer or encumbrance of any direct interests in Borrower shall be permitted (other than the pledges and security interests securing the Mezzanine B Loan and any Transfer pursuant to clause (v)); (I) for so long as the Mezzanine C Loan shall remain outstanding, no such Transfer or encumbrance of any direct interests in Mezzanine B Borrower shall be permitted (other than the pledges and security interests securing the Mezzanine C Loan and any Transfer pursuant to clause (v)); (J) for so long as the Loan, the Mortgage Loan or any other Mezzanine Loan shall remain outstanding, neither Mortgage Borrower nor Mezzanine Borrower shall issue preferred equity interests (except as otherwise permitted pursuant to the Mortgage Loan Documents, Loan Documents, Mezzanine B Loan Documents, or Mezzanine C Loan Documents, as applicable); (K) all Transfers must be made in accordance with all Gaming Regulations, including receipt of any required Gaming Licenses; and (L) in no event may Borrower effect a Transfer, or permit or suffer any Transfer, that would result in a Gaming License Default.
(d) Without the following conditions are satisfiedprior written consent of Administrative Agent, Borrower shall not and shall not cause or permit Mortgage Borrower to permit any Transfer (including any Sale or Pledge) of any interest in CPLV Tenant or any interest of CPLV Tenant in the CPLV Lease, except that Administrative Agent’s consent shall not be required, in connection with:
(i) one or a series of Transfers of the direct or indirect legal or beneficial interests in CEC, including any acquisition, merger, amalgamation or consolidation of CEC, shall be permitted, so long as (1) either (x) CEC, an entity that acquires a controlling interest in CEC or, in the case of a merger, consolidation or amalgamation of CEC where CEC is not the surviving entity, the surviving entity (the entity that acquires a controlling interest in CEC or that survives a merger, amalgamation or consolidation with CEC (if such sale CEC is not the survivor), a “Replacement CEC Sponsor”) remains a Public Vehicle or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, (y) immediately after giving effect to the such Transfer, CEC or the Replacement CEC Sponsor owns satisfies the requirements of a Qualified CPLV Replacement Guarantor and (2) in the case where after such Transfer, CEC is not a Public Vehicle, the surviving Public Vehicle or entity that qualifies as a Qualified CPLV Replacement Guarantor pursuant to clause (1)(x) or (1)(y) above, as applicable, delivers a reaffirmation of the CPLV Lease Guaranty, in form and substance reasonably acceptable to Administrative Agent contemporaneous with such Transfer or, if requested by Administrative Agent, a replacement guaranty substantially similar to the CPLV Lease Guaranty or in such other form and substance as reasonably acceptable to Administrative Agent;
(ii) one or more encumbrances of CPLV Tenant’s leasehold interest in the Property pursuant to one or more mortgages and/or pledges of the direct or indirect equity interests in CPLV Tenant, to secure indebtedness of CPLV Tenant and/or its direct or indirect parent entities or Affiliates (each, a “CPLV Tenant Loan”), and the lender of any CPLV Tenant Loan (a “CPLV Tenant Lender”);
(iii) one or a series of Transfers (except for a Pledge), (a) of not more than forty-nine percent (49%) of the direct or indirect stock, partnership interests or membership interests (as the case may be) in CPLV Tenant, or the occurrence of a Permitted CPLV Tenant Interposition, or (b) of the direct or indirect stock, partnership interests or membership interests (as the case may be) in CPLV Tenant so long as after giving effect thereto CEC (or following any Transfer under Section 5.2.10(e)(i) above, the Replacement CEC Sponsor) shall control and own not less than fifty-one percent (51%) of the economic and beneficial interests in CPLV Tenant);
(iv) a Transfer of 100% of the direct or indirect legal and beneficial interests in CPLV Tenant and/or the leasehold interest of CPLV Tenant in the Property (subject to exclusion with respect to items that are not capable of being mortgaged and that, in the aggregate, are de minimis) pursuant to or at any time after a foreclosure (or conveyance in lieu thereof or pursuant to any other exercise of remedies) of the CPLV Tenant Loan by CPLV Tenant Lender, subject to satisfaction of the following conditions:
(A) either of the following conditions shall be satisfied (the “CPLV Tenant Transferee Requirement”):
(1) (x) the proposed transferee that assumes all of the obligations, liabilities and rights of CPLV Tenant under the CPLV Lease and CPLV Lease Documents (the “CPLV Tenant Transferee”) shall be a Qualified CPLV Tenant Transferee or a Qualified CPLV Tenant Transferee shall Control and own not less than 51% of the equity economic and beneficial interests in Borrower CPLV Tenant or such CPLV Tenant Transferee after such Transfer, (y) a replacement lease guarantor that is a Qualified CPLV Replacement Guarantor shall execute a replacement guaranty substantially similar to the CPLV Lease Guaranty or in such other form and controls, directly or indirectly, Borrower;substance as acceptable to Administrative Agent and (z) the Property is managed by a Qualified Replacement Manager; or
(ii2) if as (x) a result transferee that satisfies the requirements in (b) through (g) in the definition of any such Transfer “Qualified CPLV Tenant Transferee” shall be, or series of Transfers more Control and own not less than 4951% of the direct or indirect ownership economic and beneficial interests in CPLV Tenant or CPLV Tenant Transferee after such Transfer, (y) the CPLV Lease is guaranteed by CEC (or following any Transfer under Section 5.2.10(e)(i) above, the Replacement CEC Sponsor) and (z) the Property is managed by the Manager under the Management Agreement (or a Qualified Replacement Manager under a Replacement Management Agreement in the event Mortgage Borrower shall be transferred to a Person individually or together terminated Manager in accordance with its Affiliates not owning at least 49% Section 16.5 of the direct or indirect ownership interests Management Agreement and the terms hereunder (unless Administrative Agent has consented in Borrower immediately prior its sole and absolute discretion to the permanent termination of the Management Agreement)); and
(B) such Transfer (shall not diminish any of the rights of Mortgage Borrower or as reflected Mortgage Lender under, or other result in any change to the transition services for the benefit of Mortgage Borrower and Mortgage Lender, set forth in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, Transition Services Agreement or under the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified ManagerMortgage Loan Documents;
(v) ifprior to any Transfer pursuant to clause (iv) above, after giving effect a Transfer of all right, title and interest of CPLV Tenant in the CPLV Lease to an Affiliate of CPLV Tenant that is owned and Controlled by CEC (the “Affiliate Tenant Transferee”), so long as a condition precedent to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and there is no Uncured CPLV Lease Event of Default, (B) Borrower Affiliate Tenant Transferee shall pay to Lender a loan assumption fee of 1% assume all of the then outstanding principal amount obligations of CPLV Tenant under the Loan.CPLV Lease SNDA, the CPLV Security Documents and all other Mortgage Loan Documents and/or Loan Documents to which CPLV Tenant is a party, in a manner reasonably satisfactory to Mortgage Lender and/or Administrative Agent, as applicable, in all material respects, including, without limitation, by entering into an assumption agreement in form and substan
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation or trust, the sale, conveyance, transfer, disposition, alienation, hypothecation or encumbering of more than 10% of the issued and outstanding capital stock of such Restricted Party (or the issuance of new shares of capital stock in such Restricted Party so that immediately after such issuance (in one or a series of transactions) the total capital stock then issued and outstanding is more than 110% of the total immediately prior to such issuance); (iv) if a Restricted Party is a limited or general partnership or joint venture, a change in the ownership interests in any general partner or any joint venturer, either voluntarily, involuntarily or otherwise, or the sale, conveyance, transfer, disposition, alienation, hypothecation or encumbering of all or any portion of the interest of any direct such general partner or indirect joint venturer (whether in the form of a beneficial, membership or partnership interest or in the form of a power of direction, control or management, or otherwise); or (v) if a Restricted Party is a limited liability company, a change in the ownership interests in Borrower is permitted provided that any managing member, either voluntarily, involuntarily or otherwise, or the following conditions are satisfied:sale, conveyance, transfer, disposition, alienation, hypothecation or encumbering of all or any portion of the interest of any such managing member (whether in the form of a beneficial, membership or partnership interest or in the form of a power of direction, control or management, or otherwise).
(d) Notwithstanding the foregoing, however, (i) limited partnership interests in any Restricted Party shall be freely transferable without the consent of Lender, (ii) any involuntary transfer caused by the death of any Restricted Party or any general partner, shareholder, joint venturer, manager, member or beneficial owner of a trust shall not be an Event of Default so long as Borrower is reconstituted, if required, following such sale death and so long as those persons responsible for the management of the Property and Borrower remain unchanged as a result of such death or conveyance occurs any replacement management is approved by Lender, (iii) gifts for estate planning purposes of any individual’s interests in any Restricted Party to the spouse or any lineal descendant of such individual, or to a trust for the benefit of any one or more of such individual, spouse or lineal descendant, shall not be an Event of Default so long as Borrower is reconstituted, if required, following such gift and so long as those persons responsible for the management of the Property and Borrower remain unchanged following such gift or any replacement management is approved by Lender, and (iv) membership interests or limited partnership interests in any Restricted Party and interests in any member of any Restricted Party (collectively, “Permitted Transfers”) may be transferred to any Affiliate of a Restricted Party without the consent of Lender, provided that, at all times, C▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇ or C▇▇▇ Credit Property Trust II, Inc. must continue to Control Borrower and Guarantor.
(e) Notwithstanding the foregoing provisions of this Section, at any time other than the period commencing thirty (30) days prior to a Securitization and ending thirty (30) days after such Securitization, Lender shall have consented not withhold its consent to such sale or conveyance, which consent shall not be unreasonably withheld; a Transfer of the Property provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns that Lender receives not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
sixty (ii60) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately days prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time written notice of such Transfer and no Event of Default has occurred and is continuing;, and further provided that the following additional requirements are satisfied:
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vii) Borrower shall pay, pay or cause to be paidpaid Lender an administrative fee of not more than $4,000 and an assumption fee equal to one percent (1.0%) of the outstanding principal balance of the Loan at the time of such Transfer, provided, however, that (A) no administrative fee or assumption fee shall be payable in connection with (1) a Transfer by the initial Borrower to Lender its an Identified Affiliate or (2) an initial Transfer by the initial Borrower or an Identified Affiliate to an unrelated party prior to Securitization, and (B) an administrative fee of not more than $4,000 and no assumption fee, shall be payable in connection with an initial Transfer by the initial Borrower or an Identified Affiliate to an unrelated party after Securitization;
(ii) Borrower shall pay or cause to be paid any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs incurred in connection with such sale Transfer (including, without limitation, Lender’s reasonable counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the reasonable fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or conveyanceTransferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Property, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume (subject to Section 9.3) all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not reasonably acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30 and 5.2.9 of this Agreement, no Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements and covenants reasonably required by Lender, provided that such certificates, agreements and covenants shall not materially increase the obligations of Borrower under the Loan Documents or materially decrease the rights of Borrower under the Loan Documents;
(x) If required by Lender, Transferee shall be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a qualification, reduction, downgrade or withdrawal of the ratings in effect immediately prior to such assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Intentionally omitted;
(xii) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Indemnity executed by Guarantor or execute a replacement Indemnity reasonably satisfactory to Lender;
(xiii) Borrower shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policy which endorsement shall insure the lien of the Mortgage, as modified by the assumption agreement, as a valid first lien on the Property, shall name the Transferee as owner of the Property, and shall insure that, as of the date of the recording of the assumption agreement, the Property shall not be subject to any additional exceptions or liens other than those contained in the Title Insurance Policy issued on the date hereof and the Permitted Encumbrances; and
(viixiv) in connection with any The Property shall be managed by a Qualified Manager pursuant to a Replacement Management Agreement. Immediately upon a Transfer as a result to such Transferee and the satisfaction of which Sponsor will not own at least 51% all of the equity interests in above requirements, the named Borrower and controlGuarantor herein shall be released from all liability under this Agreement, directly or indirectlythe Note, Borrower, Borrower the Mortgage and the other Loan Documents accruing after such Transfer. The foregoing release shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth effective upon the date the Transfer is expected of such Transfer, but Lender agrees to be effective and provide written evidence thereof reasonably requested by Borrower.
(Af) Lender shall have not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany previous Transfer.
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, or (Cii) permit a Sale or Pledge of any direct or indirect interest in any Borrower or other Restricted Party (any of the Room License Agreementsacts set forth in clause (i) or (ii) being referred to herein collectively as a “Transfer”) except as permitted under, and (Dsubject to the satisfaction of the conditions set forth in, Section 5.2.10(d) Permitted Transfersbelow.
(bc) Notwithstanding A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the foregoing, Property or any part thereof for a sale or conveyance price to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property subject to the lien of the Mortgage (but not any for other mortgagethan actual occupancy by a space tenant thereunder or a sale, lien assignment or other encumbrance (other than transfer of, or the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements grant of a Special Purpose Entity security interest in, Borrower’s right, title and the organizational documents of the Transferee are reasonably acceptable interest in and to Lender and, after a Securitization, to the Rating Agencies;
any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such sale corporation’s stock or conveyance occurs the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(d) Notwithstanding the provisions of this Section 5.2.10, the following transfers shall not be deemed to be a Transfer and may occur without the consent of Lender or the payment of any transfer or other fee: Transfers of direct and/or indirect interests in Borrower and in its constituent partners, stockholders, members and beneficiaries (including transfers between and among such Persons), provided that (i) FelCor OP must continue to control, directly or indirectly, on an unencumbered basis (subject to Section 5.2.10(f) below), each Borrower and each Principal and own, directly or indirectly, at least fifty-one percent (51%) of the equity and economic interests in each Borrower, (ii) FelCor REIT must at all times be the sole general partner of and control FelCor OP and continue to own, directly or indirectly, at least eighty percent (80%) of the equity and economic interests in FelCor OP, (iii) each Borrower shall remain, directly or indirectly, on an unencumbered basis (subject to Section 5.2.10(f) below), under 100% common ownership and control by FelCor OP, (iv) Lender receives prior to a Securitizationwritten notice of any such transfer and copies of the documents transferring such interest, provided that the foregoing requirement set forth in this subsection (iv) shall not be applicable in the case of transfers of limited partnership interests in FelCor OP or of publicly traded stock in FelCor REIT, and (v) if after such transfer any Person and its Affiliates collectively owns more than forty-nine (49%) in the aggregate of the direct and/or indirect interests of Borrower and as of the Assumption Date such Person and its Affiliates collectively owned forty-nine percent (49%) or less in the aggregate of the direct and/or indirect interests of Borrower, Lender shall have consented received an Additional Insolvency Opinion reasonably satisfactory to such sale Lender and the Rating Agencies.
(e) Notwithstanding the other provisions of this Section 5.2.10, Transfers of one hundred percent (100%) of the direct and/or indirect interests in Borrower or conveyancetransfers of the Property, shall be permitted with Lender’s prior written consent, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, withheld after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, consideration of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage relevant factors and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that Borrower satisfies the following conditions are satisfiedconditions:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(ivii) following such Transfer the property manager of the Property must proposed transferee (“Transferee”) shall be a Qualified Managerreputable entity or person of good character, creditworthy, and shall have sponsorship with sufficient financial worth considering the obligations assumed and undertaken, as evidenced by financial statements and other information reasonably requested by Lender;
(viii) ifthe Transferee or its sponsor and its property manager shall have sufficient experience in the ownership and management of properties similar to the Property, after giving effect and Lender shall be provided with reasonable evidence thereof (and Lender reserves the right to such Transfer, Sponsor does not own at least 51% approve the Transferee without approving the substitution of the equity interests property manager);
(iv) if a Securitization has occurred, confirmation in Borrower and control Borrower, writing from the Rating Agencies shall have confirmed to the effect that such Transfer, in and of itself, transfer will not result in a downgradere-qualification, qualification reduction or withdrawal of the then current ratings rating assigned to the SecuritiesSecurities or any class thereof in any applicable Securitization;
(v) Lender shall have received evidence reasonably satisfactory to it (which shall include a legal non-consolidation opinion reasonably acceptable to Lender) that the single purpose nature and bankruptcy remoteness of Transferee following such transfers are in accordance with the standards of the Rating Agencies;
(vi) the Transferee shall have executed and delivered to Lender an assumption agreement in form and substance reasonably acceptable to Lender, evidencing such Transferee’s agreement to abide and be bound by the terms of the Note, the Mortgage and the other Loan Documents, together with such legal opinions and title insurance endorsements as may be reasonably requested by Lender;
(vii) Lender shall have received from Borrower or Transferee on or prior to the date of the sale or transfer (A) an assumption fee equal to one percent (1.0%) of the Loan amount, (B) a rating confirmation fee for each of the Rating Agencies delivering a confirmation pursuant to clause (iv) above, which confirmation fees shall be equal to the then customary fees charged by each applicable Rating Agency for such a confirmation and (C) the payment of all out-of-pocket third-party costs and expenses incurred by Lender, Servicer and the Rating Agencies in connection with such assumption (including reasonable attorneys’ fees and costs); and
(viii) Borrower shall have provided to Lender at least thirty (30) days prior written notice of such proposed transfer.
(f) Notwithstanding anything to contrary contained in this Agreement, provided that no Event of Default has occurred and is continuing, certain owners of Borrower shall be permitted to obtain mezzanine financing (the “Subordinate Mezzanine Loan”), which Subordinate Mezzanine Loan shall be secured by the membership or partnership interests in Hotel Owner and/or Hotel Operator (as applicable) or the owners of Borrower, subject to the following conditions and requirements:
(i) Lender’s review and approval in its reasonable discretion of the terms and conditions of the Subordinate Mezzanine Loan and the documents evidencing the Subordinate Mezzanine Loan, but only to the extent such review of the documents is to confirm such terms and conditions;
(ii) the Subordinate Mezzanine Loan shall only be payable out of any excess cash flow from the Property;
(iii) the Subordinate Mezzanine Loan together with the Loan (and any New Mezzanine Loan) shall have a combined loan-to-value ratio of no greater than eighty percent (80%);
(iv) the lender under the Subordinate Mezzanine Loan shall enter into, and be subject to, an intercreditor agreement in the form and substance reasonably satisfactory to Lender in its reasonable discretion (the “Subordinate Mezzanine Intercreditor Agreement”);
(v) the Subordinate Mezzanine Loan shall be nonrecourse as to principal and interest required to be paid under the Subordinate Mezzanine Loan and shall not be secured by a lien against the Property;
(vi) Borrower shall pay, or cause to be paid, to reimburse Lender its for all reasonable out-of-pocket expenses incurred by Lender in reviewing the Subordinate Mezzanine Loan documents and negotiating and documenting the Subordinate Mezzanine Intercreditor Agreement;
(including vii) Borrower shall have obtained and delivered to Lender at Borrower’s sole cost and expense a confirmation in writing from each of the Rating Agencies that such Subordinate Mezzanine Loan will not result in a requalification, reduction, downgrade or withdrawal of the ratings in effect immediately before such Subordinate Mezzanine Loan was incurred for the Securities or any fees due class thereof issued in connection with a Securitization which are then outstanding; and
(viii) the final capital structure of the Subordinate Mezzanine Loan is subject in all respects to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with ’ approval and to Lender’s reasonable approval, including, without limitation, any Transfer as a result changes to the organizational structure of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.
Appears in 1 contract
Transfers. (a) Without Each Holder, severally and not jointly, hereby agrees, while this Agreement is in effect, and except as contemplated hereby or pursuant to the Merger Agreement, not to sell, transfer, pledge, encumber, assign or otherwise dispose of, enforce or permit the execution of the provisions of any redemption, share purchase or sale, recapitalization or other agreement with the Company or enter into any contract, option or other arrangement or understanding with respect to or consent to the offer for sale, sale, transfer, pledge, encumbrance, assignment or other disposition of, any of such Holder’s Warrants or Shares or any interest in such Holder’s Warrants or Shares, in each case including by merger or otherwise by operation of law, except (i) to Parent or Merger Sub, (ii) to a third-party which executes a joinder agreement, in form and substance reasonably satisfactory to Parent, to be bound by each of the terms of this Agreement as if a party hereto, (iii) with the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect interest therein, Parent or (iiiv) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions Section 2.3(b). The Company shall not recognize any purported transfer of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted TransfersWarrants or Shares in violation of this Agreement.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance this Agreement shall not result restrict the Holders from selling Shares for value (x) in an Event market transactions or (y) in Restricted Size Private Transactions. For purposes of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage term “Restricted Size Private Transactions” shall mean privately negotiated sales of Common Stock by one or more Holders to a purchaser which, when aggregated with other such sales by the Holders to such purchaser and each “affiliate” (as such term is defined in Rule 405 of the other Loan DocumentsSecurities and Exchange Commission) of such purchaser on or after the date hereof, subjectdo not involve more then 2,500,000 shares of Common Stock (as adjusted for any subsequent stock split, howeverstock dividend, recapitalization or similar transaction). For avoidance of doubt, no purchaser pursuant to this Section 2.3(b) shall be subject to any of the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyancethis Agreement.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, or (Cii) permit a Sale or Pledge of any direct or indirect interest in any Borrower or other Restricted Party (any of the Room License Agreementsacts set forth in clause (i) or (ii) being referred to herein collectively as a “Transfer”) except as permitted under, and (Dsubject to the satisfaction of the conditions set forth in, Section 5.2.10(d) Permitted Transfersbelow.
(bc) Notwithstanding A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the foregoing, Property or any part thereof for a sale or conveyance price to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property subject to the lien of the Mortgage (but not any for other mortgagethan actual occupancy by a space tenant thereunder or a sale, lien assignment or other encumbrance (other than transfer of, or the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements grant of a Special Purpose Entity security interest in, Borrower’s right, title and the organizational documents of the Transferee are reasonably acceptable interest in and to Lender and, after a Securitization, to the Rating Agencies;
any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such sale corporation’s stock or conveyance occurs the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(d) Notwithstanding the provisions of this Section 5.2.10, the following transfers shall not be deemed to be a Transfer and may occur without the consent of Lender or the payment of any transfer or other fee: Transfers of direct and/or indirect interests in Borrower and in its constituent partners, stockholders, members and beneficiaries (including transfers between and among such Persons), provided that (i) FelCor OP must continue to control, directly or indirectly, each Borrower and each Principal and own, directly or indirectly, on an unencumbered basis (subject to Section 5.2.10(f) below), at least fifty-one percent (51%) of the equity and economic interests in each Borrower, (ii) FelCor REIT must at all times be the sole general partner of and control FelCor OP and continue to own, directly or indirectly, at least eighty percent (80%) of the equity and economic interests in FelCor OP, (iii) each Borrower shall remain, directly or indirectly, on an unencumbered basis (subject to Section 5.2.10(f) below), under 100% common ownership and control by FelCor OP, (iv) Lender receives prior to a Securitizationwritten notice of any such transfer and copies of the documents transferring such interest, provided that the foregoing requirement set forth in this subsection (iv) shall not be applicable in the case of transfers of limited partnership interests in FelCor OP or of publicly traded stock in FelCor REIT, and (v) if after such transfer any Person and its Affiliates collectively owns more than forty-nine (49%) in the aggregate of the direct and/or indirect interests of Borrower and as of the Assumption Date such Person and its Affiliates collectively owned forty-nine percent (49%) or less in the aggregate of the direct and/or indirect interests of Borrower, Lender shall have consented received an Additional Insolvency Opinion reasonably satisfactory to such sale Lender and the Rating Agencies.
(e) Notwithstanding the other provisions of this Section 5.2.10, Transfers of one hundred percent (100%) of the direct and/or indirect interests in Borrower or conveyancetransfers of the Property, shall be permitted with Lender’s prior written consent, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, withheld after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, consideration of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage relevant factors and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that Borrower satisfies the following conditions are satisfiedconditions:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(ivii) following such Transfer the property manager of the Property must proposed transferee (“Transferee”) shall be a Qualified Managerreputable entity or person of good character, creditworthy, and shall have sponsorship with sufficient financial worth considering the obligations assumed and undertaken, as evidenced by financial statements and other information reasonably requested by Lender;
(viii) ifthe Transferee or its sponsor and its property manager shall have sufficient experience in the ownership and management of properties similar to the Property, after giving effect and Lender shall be provided with reasonable evidence thereof (and Lender reserves the right to such Transfer, Sponsor does not own at least 51% approve the Transferee without approving the substitution of the equity interests property manager);
(iv) if a Securitization has occurred, confirmation in Borrower and control Borrower, writing from the Rating Agencies shall have confirmed to the effect that such Transfer, in and of itself, transfer will not result in a downgradere-qualification, qualification reduction or withdrawal of the then current ratings rating assigned to the SecuritiesSecurities or any class thereof in any applicable Securitization;
(v) Lender shall have received evidence reasonably satisfactory to it (which shall include a legal non-consolidation opinion reasonably acceptable to Lender) that the single purpose nature and bankruptcy remoteness of Transferee following such transfers are in accordance with the standards of the Rating Agencies;
(vi) the Transferee shall have executed and delivered to Lender an assumption agreement in form and substance reasonably acceptable to Lender, evidencing such Transferee’s agreement to abide and be bound by the terms of the Note, the Mortgage and the other Loan Documents, together with such legal opinions and title insurance endorsements as may be reasonably requested by Lender;
(vii) Lender shall have received from Borrower or Transferee on or prior to the date of the sale or transfer (A) an assumption fee equal to one percent (1.0%) of the Loan amount, (B) a rating confirmation fee for each of the Rating Agencies delivering a confirmation pursuant to clause (iv) above, which confirmation fees shall be equal to the then customary fees charged by each applicable Rating Agency for such a confirmation and (C) the payment of all out-of-pocket third-party costs and expenses incurred by Lender, Servicer and the Rating Agencies in connection with such assumption (including reasonable attorneys’ fees and costs); and
(viii) Borrower shall have provided to Lender at least thirty (30) days prior written notice of such proposed transfer.
(f) Notwithstanding anything to contrary contained in this Agreement, provided that no Event of Default has occurred and is continuing, certain owners of Borrower shall be permitted to obtain mezzanine financing (the “Subordinate Mezzanine Loan”), which Subordinate Mezzanine Loan shall be secured by the membership or partnership interests in Hotel Owner and/or Hotel Operator (as applicable) or the owners of Borrower, subject to the following conditions and requirements:
(i) Lender’s review and approval in its reasonable discretion of the terms and conditions of the Subordinate Mezzanine Loan and the documents evidencing the Subordinate Mezzanine Loan, but only to the extent such review of the documents is to confirm such terms and conditions;
(ii) the Subordinate Mezzanine Loan shall only be payable out of any excess cash flow from the Property;
(iii) the Subordinate Mezzanine Loan together with the Loan (and any New Mezzanine Loan) shall have a combined loan-to-value ratio of no greater than eighty percent (80%);
(iv) the lender under the Subordinate Mezzanine Loan shall enter into, and be subject to, an intercreditor agreement in the form and substance reasonably satisfactory to Lender in its reasonable discretion (the “Subordinate Mezzanine Intercreditor Agreement”);
(v) the Subordinate Mezzanine Loan shall be nonrecourse as to principal and interest required to be paid under the Subordinate Mezzanine Loan and shall not be secured by a lien against the Property;
(vi) Borrower shall pay, or cause to be paid, to reimburse Lender its for all reasonable out-of-pocket expenses incurred by Lender in reviewing the Subordinate Mezzanine Loan documents and negotiating and documenting the Subordinate Mezzanine Intercreditor Agreement;
(including vii) Borrower shall have obtained and delivered to Lender at Borrower’s sole cost and expense a confirmation in writing from each of the Rating Agencies that such Subordinate Mezzanine Loan will not result in a requalification, reduction, downgrade or withdrawal of the ratings in effect immediately before such Subordinate Mezzanine Loan was incurred for the Securities or any fees due class thereof issued in connection with a Securitization which are then outstanding; and
(viii) the final capital structure of the Subordinate Mezzanine Loan is subject in all respects to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with ’ approval and to Lender’s reasonable approval, including, without limitation, any Transfer as a result changes to the organizational structure of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or any interest of Borrower in the Loan or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer shall include (but not i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of any Individual Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non managing membership interests or the creation or issuance of new non managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions are satisfied:creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(id) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverNotwithstanding the provisions of this Section 5.2.10, Lender’s consent shall not be required ifin connection with one or a series of Transfers, of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such Transfer shall result in the change of Control in a Restricted Party, and as a condition to each such Transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed Transfer. If after giving effect to the any such Transfer, Sponsor owns not more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than 51% forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the equity interests Closing Date, Borrower shall, no less than thirty (30) days prior to the effective date of any such Transfer, deliver to Lender an Additional Insolvency Opinion acceptable to Lender and the Rating Agencies. Borrower shall pay any and all reasonable out-of-pocket costs and expenses incurred in connection with such Transfers (including Lender’s counsel fees and disbursements and any fees and expenses of the Rating Agencies).
(e) No Transfer of the Property (or any portion thereof) and assumption of the Loan shall occur during the period that is sixty (60) days prior to and sixty (60) days after a Securitization. Without limiting Lender’s discretion to approve or disapprove any request for a waiver of the prohibition against Transfers, Lender specifically reserves the right to condition its consent to any waiver of a prohibited Transfer upon satisfaction of the following minimum conditions:
(i) Borrower and controls, directly or indirectly, Borrowershall pay Lender a transfer fee equal to one percent (1%) of the outstanding principal balance of the Loan at the time of such transfer;
(ii) if Borrower shall pay any and all reasonable out-of-pocket costs incurred in connection with such Transfer (including Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or Transferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to each Individual Property, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Default or Event of Default shall otherwise occur as a result of any such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements, covenants and legal opinions reasonably required by Lender;
(x) If required by Lender, Transferee shall be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a requalification, reduction, downgrade or series of Transfers more than 49% withdrawal of the direct or indirect ownership interests ratings in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower effect immediately prior to such Transfer assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Prior to any release of Guarantor, one (1) or more substitute guarantors acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or execute a replacement guaranty and environmental indemnity reasonably satisfactory to Lender.
(xii) Borrower shall deliver, at its sole cost and expense, an endorsement to each Title Insurance Policy, as reflected modified by the assumption agreement, as a valid first lien on each Individual Property and naming the Transferee as owner of each Individual Property, which endorsement shall insure that, as of the date of the recording of the assumption agreement, each Individual Property shall not be subject to any additional exceptions or liens other than those contained in the most recent Additional Insolvency Opinion delivered Title Policies issued on the date hereof and the Permitted Encumbrances;
(xiii) Each Individual Property shall be managed by Qualified Manager pursuant to a Replacement Management Agreement; and
(xiv) The Property meets all of the Lender)’s underwriting standards related to its financial condition, cash flow, operating income, physical condition, management and operation.
(xv) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion which reflecting such Transfer satisfactory in form and substance to Lender.
(f) Notwithstanding any provision in this Section 5.2.10 to the contrary, limited partnership or membership interests, as applicable, in Borrower may be relied upon by transferred without Lender’s consent and without application of the fee set forth in Section 5.2.10(e)(i): (i) among limited partners or members, as applicable, of Borrower who are limited partners or members, as applicable, of Borrower as of the Rating Agencies date of this Agreement (each a “Current Owner”), and their respective counsel, successors and assigns, with respect (ii) to the proposed transfer or sale, immediate family members (which Additional Insolvency Opinion shall be reasonably acceptable limited to Lender anda spouse, after a Securitizationparent, child and grandchild (each, an “Immediate Family Member”)), of any Current Owner or to trusts formed for the Rating Agencies;
(iii) at the time benefit of Immediate Family Members of such Transfer Current Owner for bona fide estate planning purposes (each, an “Additional Permitted Transfer”), provided each of the following conditions is satisfied: (A) no Event of Default has occurred and no event has occurred that with notice and/or the passage of time, or both, would constitute an Event of Default; (B) Lender has received Borrower’s notice of the Additional Permitted Transfer no less than 30 days prior to the commencement of such transfer; (C) no Indemnitor or Guarantor shall be released from any guaranty or indemnity agreement by virtue of the Additional Permitted Transfer; (D) Borrower shall be responsible for the costs and expenses of documenting the Additional Permitted Transfer; (E) Borrower shall reimburse Lender for all actual costs and expenses incurred by Lender in connection with the Additional Permitted Transfer, whether or not consummated; (F) once the Additional Permitted Transfer is continuing;
(iv) following such Transfer complete, the property manager persons with Control of Borrower and management of the Property must be a Qualified Manager;
(v) if, after giving effect to are the same persons who have such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower Control and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned management rights immediately prior to the Securities
Additional Permitted Transfer; (viG) Borrower shall pay, or cause to be paid, to furnish Lender its reasonable out-of-pocket expenses (including copies of any fees due to the Rating Agencies) documentation executed in connection with such sale or conveyancethe Additional Permitted Transfer promptly after execution thereof; and
(viiH) in connection with any Transfer as a result of which Sponsor will not own at least 51% of Borrower shall have delivered satisfactory evidence to Lender that, following the equity interests in Borrower and control, directly or indirectly, BorrowerAdditional Permitted Transfer, Borrower shall give or cause continue to be given written notice to Lender comply with the provisions of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective Section 4.1.30 hereof; and (AI) upon Lender’s request, delivery of an Additional Insolvency Opinion acceptable to Lender. Lender shall have not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany previous Transfer.
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners, as applicable, in owning the Collateral in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Collateral so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Collateral.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Collateral, the Property or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party ((i) and (ii) collectively, a “Transfer”), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.205.1.20 hereof.
(c) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Collateral or any part thereof for a price to be paid in installments; (ii) an agreement by Mortgage Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Mortgage Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the limited liability company interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such limited liability company interest, or the Sale or Pledge of non-managing limited liability company interests or the creation or issuance of new non-managing limited liability company interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(d) Notwithstanding the provisions of this Section 5.2.10, the following transfers shall not be deemed to be a Transfer and shall not require Lender’s consent: (i) the sale or transfer, in one or a series of transactions, of not more than forty-nine percent (49%) of the stock in a Restricted Party; (ii) the sale or transfer, directly or indirectly, in one or a series of transactions, of not more than forty-nine percent (49%) of the limited partnership interests or non-managing limited liability company interests (as the case may be) in a Restricted Party; provided, however, that with respect to each such sale or transfer (A) no such sales or transfers shall result in the change of voting control in the Restricted Party, (B) as a condition to each such sale or transfer, Lender shall receive not less than thirty (30) days prior notice of such proposed sale or transfer, (C) the Room License Agreementsno such sale or transfer of any direct ownership interests in Borrower, General Partner or Mortgage Borrower shall be permitted, (D) Borrower shall pay or cause to be paid any and all costs imposed or incurred as a result of any such sale or transfer, including, without limitation, any transfer taxes, and (DE) Permitted Transfersif after giving effect to any such sale or transfer, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion acceptable to Lender and the Rating Agencies; and (iii) the execution by Mortgage Borrower of a license agreement and related documents for the operation of a health club on the Property with a wholly owned taxable reit subsidiary of the Operating Partnership provided that Mortgage Borrower delivers to Lender an executed copy of such license agreement and related documents and all fees payable to Mortgage Borrower arising from such license are deposited into the Lockbox Account. In addition to the requirements of this Section 5.2.10(d), except following transfers of the Property permitted pursuant to Section 5.2.10(f), at all times during the term of the Loan, the Operating Partnership must continue to control Borrower, Mortgage Borrower and Affiliated Manager and own, directly or indirectly, at least a fifty-one percent (51%) interest in Borrower, Mortgage Borrower and Affiliated Manager. The sale, transfer or issuance of stock in the REIT shall not be deemed a transfer hereunder provided the stock of the REIT is listed and traded on the New York Stock Exchange or such other nationally recognized stock exchange.
(be) Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon a Transfer without Lender’s written consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer.
(f) Notwithstanding anything to the foregoingcontrary contained herein, and without limiting any Transfers or rights under Section 5.2.10(g) hereof, Lender agrees that it shall not unreasonably withhold its consent to a sale Transfer (or conveyance by Borrower to an unlimited number of Transfers) of the Property subject to by Mortgage Borrower (or the lien then owner of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted , provided that the following terms and conditions are satisfied: (i) Borrower (or the then owner of the Property) shall have given at least thirty (30) days prior written notice to Lender of the proposed Transfer and the proposed Transfer shall not be effective earlier than the date that is three (3) months after the first Payment Date, (ii) no Default, Mortgage Loan Default or Event of Default shall have occurred or be continuing; (iii) an express assumption of this Agreement, the Note, and the other Loan Documents by the principals of the proposed transferee of the Property, and a pledge by the principals of the proposed transferee of all of their equity interest in the transferee of the Property as security for the Loan in form and substance satisfactory to Lender, in each case subject to the provisions of Section 9.4 hereof; (iv) payment of all of fees and expenses incurred in connection with such Transfer, including, without limitation, the cost of any third party reports, legal fees and expenses, Rating Agency fees and expenses or required legal opinions; (v) payment of a non-refundable $5,000 application fee and an assumption fee equal to one-quarter of one percent (0.25%) of the Outstanding Principal Balance with respect to the initial transfer and one-half of one percent (0.50%) of the Outstanding Principal Balance with respect to each transfer thereafter; (vi) the delivery of an Additional Insolvency Opinion reflecting the proposed Transfer reasonably satisfactory in form and substance to Lender; (vii) the proposed transferee’s compliance with the representations and covenants set forth in Section 4.1.30 and Section 5.2.9 hereof; (viii) the delivery of evidence satisfactory to Lender that the single purpose nature and bankruptcy remoteness of the proposed transferee, and its shareholders, partners or members, as the case may be, following such Transfer is in accordance with the then current standards of Lender and the Rating Agencies; (ix) prior to any release of Guarantor, a substitute guarantor acceptable to Lender in its sole discretion shall have assumed the Guaranty executed by Guarantor or executed a replacement guaranty reasonably satisfactory to Lender; (x) Lender shall have received confirmation in writing from the Rating Agencies to the effect that such Transfer will not result in a re-qualification, reduction or withdrawal of the then current rating assigned to the Securities or any class thereof in any applicable Securitization; (xi) the satisfaction of all of the conditions set forth in Section 5.2.10 (f) of the Mortgage Loan Agreement; and (xii) the satisfaction of such other conditions as Lender shall determine in its reasonable discretion to be in the interest of Lender, including, without limitation, the creditworthiness, reputation and qualifications of the transferee with respect to the Loan, the Mortgage Loan and the Property.
(g) A Transfer that occurs by inheritance, devise or bequest or by operation of law upon the death or disability of a natural person who holds an indirect interest in Mortgage Borrower and a Transfer by a natural person of indirect interests in Mortgage Borrower for estate planning purposes shall not require the consent of Lender and no transfer fee shall be payable in connection therewith, provided that, in each case, such Transfer is to a non-minor member of the immediate family of the holder of such interest, or a trust established for the benefit of a member of the immediate family of the holder of such interest, and provided further that, in each case, each of the following transfer conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Defaultremain uncured;
(ii) the Person to whom the Property is sold or conveyed Borrower shall give Lender notice of such Transfer together with copies of all instruments effecting such transfer not less than ten (the “Transferee”10) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs days prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of or in the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed event that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers shall result in any Person that does not own more than 49a 20% of the direct or indirect ownership interests interest in Mortgage Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% as of the date hereof owning more than a 20% direct or indirect ownership interests interest in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Mortgage Borrower, Borrower shall deliver give Lender thirty (30) days prior written notice of such Transfer and Lender shall have an opportunity to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies perform its customary credit and their respective counsel, successors and assigns, background searches with respect to such transferee, except in the proposed transfer case of the death or saledisability of an interest holder, in which Additional Insolvency Opinion event Borrower shall be reasonably acceptable to give Lender and, notice of such Transfer within ten (10) Business Days after a Securitization, the Rating Agenciessuch Transfer;
(iii) at the time of no such Transfer no Event of Default has occurred and interest shall result in a change of control of Mortgage Borrower or Borrower (or its managing member or general partner) or the day to day operations of the Property, or, if such Transfer would result in a change of control of Mortgage Borrower or Borrower (or its managing member or general partner) or the day to day operations of the Property as a result of the death or disability of an interest holder that is continuinga natural person, Lender shall have approved in good faith the Person that will control Mortgage Borrower or Borrower and/or the day to day operations of the Property;
(iv) following such Transfer the property manager legal and financial structure of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Mortgage Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and controltheir shareholders, directly partners or indirectlymembers, Borrower, Borrower shall give or cause to be given written notice to Lender of and the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee single purpose nature and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.bankruptcy
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should an Event of Default occur in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, which consent shall not be unreasonably withheld, conditioned, or delayed, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or any interest of Borrower in the Loan or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (CB) the Room License AgreementsPermitted Transfers, and (DC) Permitted TransfersEncumbrances.
(bc) Notwithstanding A Transfer shall include (i) an installment sales agreement wherein Borrower agrees to sell the foregoing, Property or any part thereof for a sale or conveyance price to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property subject for other than actual occupancy by a space Tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents (except with respect to the lien security interest created under the Loan Documents); (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the Mortgage partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (but not v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non managing membership interests or the creation or issuance of new non managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(d) Notwithstanding any contrary provisions of this Section 5.2.10 or anything else to the contrary contained in this Agreement or any other mortgageLoan Documents, lien Lender’s consent shall not be required in connection with one or other encumbrance a series of Transfers, of not more than forty-nine percent (other than 49%) of the Permitted Encumbrances and Room License Agreements hereafter entered into stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such Transfer shall result in the ordinary course change of operating Control in a Restricted Party, and as a condition to each such Transfer, Lender shall receive not less than fifteen (15) days prior written notice of such proposed Transfer. If after giving effect to any such Transfer, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the Closing Date, Borrower shall, no less than fifteen (15) days prior to the effective date of any such Transfer, deliver to Lender an Additional Insolvency Opinion acceptable to Lender and the Rating Agencies. In addition, at all times, the management team of City Office REIT Operating Partnership, L.P. must continue to Control Borrower and the Property. Borrower shall pay any and all reasonable and documented out-of-pocket costs and expenses incurred in connection with such Transfers (including Lender’s counsel fees and disbursements and any fees and expenses of the Rating Agencies).
(e) No Transfer of the Property and assumption of the Loan shall occur during the period that is permitted sixty (60) days prior to and sixty (60) days after a Securitization. Except for such 120 day period, so long as no Event of Default exists and is then continuing, Lender shall not unreasonably withhold, condition, or delay its consent to a Transfer of the Property and assumption of the Loan provided that the following minimum conditions are satisfied:
(i) no Event Borrower shall pay Lender a transfer fee equal to one-half percent (0.50%) of Default shall have occurred and be continuing and the outstanding principal balance of the Loan at the time of such sale or conveyance shall not result in an Event of Defaulttransfer;
(ii) Borrower shall pay any and all reasonable and documented out-of-pocket costs incurred in connection with such Transfer (including Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the Person fees and expenses of the Rating Agencies pursuant to whom the Property is sold or conveyed clause (x) below);
(iii) The proposed transferee (the “Transferee”) satisfies the requirements of a Special Purpose Entity or Transferee’s Principals must have demonstrated experience in owning and the organizational documents of the Transferee are reasonably acceptable to Lender andoperating properties similar in location, after a Securitizationsize, class and operation to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyanceProperty, which consent experience shall not be unreasonably withheldreasonably determined by Lender;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliatesTransferee’s Principals shall, which Additional Insolvency Opinion shall be reasonably as of the date of such transfer, have an aggregate net worth and liquidity acceptable to Lender or, after a Securitization, the Rating AgenciesLender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any voluntary bankruptcy proceedings, or involuntary bankruptcy proceedings (except to the extent dismissed within ninety (90) days following the commencement thereof), made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents, from and after the date of such assumption, in a manner reasonably satisfactory to Lender in all respects, including by entering into an assumption agreement in form and substance reasonably satisfactory to Lender;
(vii) There shall be no material adverse litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have materially defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not acceptable to Lender in its reasonable discretion;
(ix) Transferee and Transferee’s Principals must be able to satisfy, in all material respects, all the representations and covenants set forth in Sections 4.1.30, 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements, covenants and legal opinions reasonably required by Lender;
(x) If required by Lender, Transferee shall be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a requalification, reduction, downgrade or withdrawal of the ratings in effect immediately prior to such assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or execute a replacement guaranty and environmental indemnity reasonably satisfactory to Lender.
(xii) Borrower shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policy, as modified by the assumption agreement, as a valid first lien on the Property and naming the Transferee as owner of the Property, which endorsement shall execute an assumptioninsure that, effective as of the date of transfer, of all the recording of the obligations of the Borrower thereafter arising or to be performed under this Agreementassumption agreement, the Mortgage Property shall not be subject to any additional exceptions or liens other than those contained in the Title Policy issued on the date hereof and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan DocumentsPermitted Encumbrances;
(vixiii) following such sale or conveyance the property manager of the The Property must shall be a managed by Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior Manager pursuant to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, BorrowerReplacement Management Agreement;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.
Appears in 1 contract
Transfers. (a) Without Each Shareholder agrees to execute a customary lock-up agreement with the underwriters in connection with the IPO, provided that the duration of the lock-up period shall not exceed 180 days. In addition, each Shareholder agrees, other than as contemplated in the registration statement therefore, (i) not to Transfer any of its Securities in a manner that would not be permitted under the terms of the Original Shareholders Agreement, (ii) not to take any other action that would not be permitted under the terms of the Original Shareholders Agreement (or if action can only be taken with the consent or approval of one or more Persons, not to take any such action without obtaining the consent(s) or approval(s) of the Person(s) specified in the Original Shareholders Agreement), or (iii) fail to take any action required to be taken by the Original Shareholders Agreement, in each of such cases (i), (ii) and (iii), prior written consent to the earlier of Lender(x) the consummation of the IPO and (y) the date that is ten Business Days after the date of this Agreement. For the avoidance of doubt, the ten Business Day time period set forth in clause (y) of the immediately preceding sentence shall not expire before the ten Business Day time period set forth in Section 4.16.
(b) Any and all rights and obligations under this Agreement that apply to a Shareholder will apply with equal force to any Person to whom such Shareholder Transfers (in compliance with this Agreement) Securities, and except it will be a condition to any Transfer of Securities otherwise permitted by this Agreement that the Transferee execute an agreement by which the Transferee agrees to become a party to and be bound by this Agreement, and acknowledges that the Securities Transferred to such Transferee by a Shareholder will be subject to the terms of this Agreement, unless such Transfer is made (i) pursuant to an offering registered under the Securities Act, or to the public through a broker, dealer or market-maker pursuant to Rule 144 promulgated thereunder, (ii) in a transaction that will result in the termination of this Agreement or (iii) by any Sponsor Holder to the limited partners or other equity owners of such Sponsor Holder.
(c) Any attempt by a Shareholder to Transfer any Securities not in compliance with this Agreement will be null and void and any such improper Transfer will not be registered, or otherwise recognized in the Corporation’s records. No Shareholder will enter into any transaction or series of transactions for the purpose or with the effect of, directly or indirectly, denying or impairing the rights or obligations of any other Person under this Agreement, and any such transaction will be null and void and, to the extent that such transaction requires any action by the Corporation, it will not be registered or otherwise recognized in the Corporation’s records or otherwise.
(d) For so long as the transfer restrictions set forth in this Section 5.2.10 2.1 remain in effect, each certificate or option representing a Security subject to such restrictions and owned by any Shareholder, if certificated, will (unless otherwise permitted by the provisions of this Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any 2.1(d)) include one of the following (collectivelylegends, as applicable, in addition to any other legends required by applicable Law or agreement: THE OFFER AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE OFFERED OR SOLD EXCEPT IN COMPLIANCE THEREWITH. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER AND VOTING AS SET FORTH IN A SHAREHOLDERS AGREEMENT, A COPY OF WHICH MAY BE OBTAINED FROM THE CORPORATION. THE OFFER AND SALE OF THIS OPTION AND THE SECURITIES REPRESENTED BY THIS OPTION HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND THIS OPTION AND THE SECURITIES REPRESENTED BY THIS OPTION MAY NOT BE OFFERED OR SOLD EXCEPT IN COMPLIANCE THEREWITH. THIS OPTION AND THE SECURITIES REPRESENTED BY THIS OPTION ARE SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER AND VOTING AS SET FORTH IN A SHAREHOLDERS AGREEMENT, A COPY OF WHICH MAY BE OBTAINED FROM THE CORPORATION. If such Securities are not certificated, a similar notation will be made on the books and records of the Corporation. Any Shareholder may, upon providing evidence, including an opinion of counsel reasonably satisfactory to the Corporation that such Securities either are not “Transfer”): restricted securities” (ias defined in Rule 144) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect interest therein, or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) may be sold pursuant to Leases Rule 144(b)(1), exchange the certificate representing such Securities for a new certificate that does not bear the first sentence of space the applicable legend set forth in this Section 2.1(d) or remove such notation from the Improvements to tenants in accordance with books and records of the Corporation. Upon termination or expiration of the provisions of this Agreement restricting the Transfer and voting of the Securities, any Shareholder may exchange its certificate(s) representing its Securities for a new certificate that does not bear the legend set forth in the second sentence of the applicable legend set forth in this Section 5.1.20, (C2.1(d) the Room License Agreements, and (D) Permitted Transfersor such notation may be removed.
(be) Notwithstanding In order to allow the foregoingShareholders to fulfill any beneficial ownership reporting obligations they may have, if a sale Shareholder acquires or conveyance by Borrower disposes of the Property subject to the lien registered or beneficial ownership (as such term is defined in Rule 13d-3 of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbranceExchange Act) of any direct Securities, such Shareholder shall, within two Business Days following consummation of such acquisition or indirect interests in Borrower is permitted provided that disposition, deliver notice thereof to the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyanceCorporation, which consent the Corporation shall not be unreasonably withheld; provided howeverpromptly, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests and in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time event within two Business Days following receipt of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) ifnotice, after giving effect forward to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.each other Shareholder. III VOTING AGREEMENTS
Appears in 1 contract
Sources: Shareholder Agreement
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners, as applicable, in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower the Property or Operating Lesseein any Restricted Party (collectively, a “Transfer”), other than (A) the Operating Lease, (Bx) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements5.1.20 hereof, and (Dy) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower disposition of the Equipment and other Personal Property subject pursuant to the lien of the Mortgage (but not any other mortgage, lien replacement thereof or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into otherwise in the ordinary course of operating the operation of the Property).
(c) is permitted provided that the following conditions are satisfied:
A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property, or any part thereof, for a price to be paid in installments; (ii) an agreement by Borrower leasing all or substantially all of the Property for other than actual occupancy by a space tenant thereunder, or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no Event managing member, any member) or the Sale or Pledge of Default the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(d) Notwithstanding the provisions of this Section 5.2.10, the following transfers shall have occurred not be deemed to be a Transfer: (i) the sale or transfer, in one or a series of transactions, of not more than forty-nine percent (49%) of the equity interests in a Restricted Party; provided, however, no such sales or transfers shall result in the change of voting control in the Restricted Party, and be continuing and as a condition to each such sale or conveyance transfer, Lender shall receive not result in an Event less than thirty (30) days prior notice of Default;
such proposed sale or transfer and (ii) the Person to whom the Property is sold sale or conveyed transfer, in one or a series of transactions, of not more than forty-nine percent (the “Transferee”49%) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such sales or transfers shall result in the change of voting control in the Restricted Party, and as a condition to each such sale or transfer, Lender andshall receive not less than thirty (30) days prior notice of such proposed sale or transfer, after a Securitization, to the Rating Agencies;
and (iii) if the sale, transfer or issuance of stock in Guarantor, provided such sale stock is listed on the New York Stock Exchange or conveyance occurs prior such other nationally recognized stock exchange. In addition, at all times, Guarantor (or any successor-in-interest permitted under subsection (d)(iii) above) must continue to control Borrower and own, directly or indirectly, at least a ninety-five percent (95%) interest in Borrower.
(e) At Lender’s election, in its sole discretion, Lender will not unreasonably withhold its consent to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
Transfer (ivother than a Transfer made in accordance with the foregoing Section 5.2.10(d)) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender(i) a modification of the terms hereof, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a SecuritizationNote, the Rating Agencies;
Mortgage or the other Loan Documents; (vii) the Transferee shall execute an assumption, effective as assumption of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Note, the Mortgage and the other Loan DocumentsDocuments as so modified by the proposed transferee, subject, however, subject to the provisions of Section 9.3 hereof 9.4 hereof; (iii) payment of all of fees and upon expenses incurred in connection with such Transfer including, without limitation, the cost of any third party reports, legal fees and expenses, Rating Agency fees and expenses or required legal opinions; (iv) the payment of a non-refundable $5,000 application fee and an assumption fee equal to (A) $100,000 for the first such assumption, Borrower shall be released from all liabilities and obligations under (B) one-half percent (.5%) of the Loan Documents;
Outstanding Principal Balance for each subsequent assumption; (v) the delivery of a nonconsolidation opinion reflecting the proposed Transfer satisfactory in form and substance to Lender; (vi) following such sale or conveyance the property manager of proposed transferee’s continued compliance with the Property must be a Qualified Managerrepresentations and covenants set forth in Section 4.1.30 and Section 5.2.9 hereof; and
(vii) the Transferee pays delivery of evidence satisfactory to Lender a loan assumption fee that the single purpose nature and bankruptcy remoteness of 1% of Borrower, its shareholders, partners or members, as the case may be, following such Transfers are in accordance with the then outstanding principal amount current standards of Lender and the Loan;
Rating Agencies; (viii) if, after giving effect prior to such Transfer, Sponsor does not own at least 51% any release of the equity interests Guarantor, a substitute guarantor reasonably acceptable to Lender shall have assumed the Guaranty executed by Guarantor or executed a replacement guaranty reasonably satisfactory to Lender; (ix) if required by Lender, confirmation in Borrower and control Borrower, writing from the Rating Agencies have confirmed to the effect that such sale or conveyance, in and of itself, Transfer will not result in a downgradere-qualification, qualification reduction or withdrawal of the then current ratings rating assigned to the SecuritiesSecurities or any class thereof in any applicable Securitization; and
and (ixx) Borrower pays Lender’s reasonable costs and expenses (including any fees due prior to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation consummation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, the proposed transferee is a Qualified Transferee. Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Transfer, Sponsor owns not less than 51% Obligations immediately due and payable upon a Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of the equity interests in Borrower and controls, directly whether voluntary or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall paynot, or cause to be paid, to whether or not Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have has consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany previous Transfer.
Appears in 1 contract
Sources: Loan Agreement (Eagle Hospitality Properties Trust, Inc.)
Transfers. (a) Borrower acknowledges that each Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning collateral such as the Collateral in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that each Lender has a valid interest in maintaining the value of the Collateral so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, each Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of LenderAdministrative Agent, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property Property, the Mezzanine A Collateral, the Collateral or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) enter into any PACE Loan, (iii) permit a Sale or Pledge of a direct or indirect an interest in Borrower any Restricted Party, (iv) permit a Sale or Operating Lessee, Pledge of the CPLV Lease or any interest therein or (v) permit a Sale or Pledge of any interest in CPLV Tenant or CPLV Tenant’s leasehold interest in the Property other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (B) Permitted Transfers (including Permitted Encumbrances), (C) pursuant to customary short-term occupancy agreements with the Room License AgreementsCPLV Tenant or short-term hotel guests, and or (D) Permitted Transfersa Transfer of a portion of the Property to a Governmental Authority in connection with a Condemnation of such portion of the Property in accordance with Section 6.3 hereof.
(bc) Notwithstanding A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the foregoingCollateral or any part thereof, Mezzanine A Borrower Mezzanine A Borrower agrees to sell the Mezzanine A Collateral or any part thereof, or Mortgage Borrower agrees to sell the Property or any part thereof, in each case, for a sale price to be paid in installments; (ii) an agreement by Mortgage Borrower leasing all or conveyance by Borrower a substantial part of the Property subject for other than actual occupancy by a space Tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Mortgage Borrower’s right, title and interest in and to the lien of the Mortgage (but not CPLV Lease or any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
CPLV Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such sale corporation’s stock or conveyance occurs prior to the creation or issuance of new stock; (iv) if a SecuritizationRestricted Party is a limited or general partnership or joint venture, Lender shall have consented any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such sale partnership interest, or conveyancethe Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, which any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the Manager other than in accordance with Section 5.1.22 hereof.
(d) Notwithstanding the provisions of this Section 5.2.10(a), Administrative Agent’s consent shall not be unreasonably withheld;
required in connection with (i) one or a series of Transfers (except for a Pledge) of (x) not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party or (y) the indirect equity interests in Mezzanine C Borrower by any Person that owns less than forty-nine percent (49%) of the economic and legal beneficial interests in, and does not Control, any of Mortgage Borrower, Mortgage Principal, Principal, any Mezzanine Borrower or Guarantor, (ii) any transfer of any direct or indirect legal or beneficial interests in the REIT, so long as it is a Public Vehicle, (iii) the cancellation, surrender, disposition, issuance, sale, grant, or Transfer of the operating partnership units of Guarantor, so long as the REIT continues to Control Guarantor and own directly or indirectly not less than 51% of the legal and beneficial interest in Guarantor, (iv) Lender has received an Additional Insolvency Opinion which the pledge of or grant of a security interest in the direct or indirect equity interests in Mortgage Borrower as security for the Loan or the other Mezzanine Loans, (v) the exercise by any Mezzanine Collateral Agent (on behalf of the applicable Mezzanine Lender) of any rights or remedies such Mezzanine Collateral Agent may be relied upon by Lender, have under the Rating Agencies and their respective successors and assigns, applicable Mezzanine Loan Documents with respect to the Transferee pledge and/or security interest referred to in the foregoing clause (iv), and its applicable affiliates(vi) the Mezzanine C Equity Conversion; provided, which Additional Insolvency Opinion shall be reasonably acceptable however, that with respect to Lender or, after a Securitization, the Rating Agencies;
each such Transfer (other than under clause (v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
clause (vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
above), (viiA) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned (x) REIT shall continue to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Control Mortgage Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.Guarantor,
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower's ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the other obligations under the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of such other obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party (collectively, a "Transfer"), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(bc) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a price to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower's right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation's stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof. -42-
(d) Notwithstanding the foregoingprovisions of this Sections 5.2.10, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfiedtransfers shall not be deemed to be a Transfer and no assumption fee will be charged in connection therewith:
(i) The (a) Sale of limited partnership interests to current limited partners of a Restricted Party (or to Affiliates of such limited partners) and (b) Sale or Pledge, in one or a series of transactions, of not more than forty-nine percent (49%) of the stock in a Restricted Party to any Person who is not a current limited partner (or Affiliate) of a Restricted Party or under common control with such limited partner; provided, however, that no Event such transfers shall result in a change of Default voting control in the Restricted Party, and as a condition to each such transfer, Lender shall have occurred and be continuing receive not less than thirty (30) days prior written notice of such proposed transfer, together with copies of all instruments effecting such transfer and such sale or conveyance other information as shall not result reasonably allow Lender to determine if such transfer meets the criteria set forth herein, and Borrower shall pay all of the fees and expenses incurred by Lender in an Event of Defaultconnection therewith, including, without limitation, reasonable attorneys' fees;
(ii) The Sale or Pledge, in one or a series of transactions, of not more than forty-nine percent (49%) of the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party to any Person to whom the Property who is sold or conveyed (the “Transferee”) satisfies the requirements not a limited partner of a Special Purpose Entity and the organizational documents Restricted Party as of the Transferee are date hereof, or a Person who is wholly owned and controlled by such limited partner; provided, however, that no such transfers shall result in a change of voting control in the Restricted Party, and as a condition to each such transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed transfer, together with copies of all instruments effecting such transfer and such other information as shall reasonably acceptable allow Lender to determine if such transfer meets the criteria set forth herein, and Borrower shall pay all of the fees and expenses incurred by Lender andin connection therewith, after a Securitizationincluding, to the Rating Agencieswithout limitation, reasonable attorneys' fees;
(iii) if such So long as Pennsylvania Real Estate Investment Trust remains a publicly traded and listed entity on a nationally recognized stock exchange, the sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;transfer of shares of stock in Pennsylvania Real Estate Investment Trust; and
(iv) The sale or transfer of partnership interests in PREIT Associates, L.P., provided, however, that Pennsylvania Real Estate Investment Trust remains the general partner of PREIT Associates, L.P. and maintains at all times at least a fifty-one percent (51%) interest in PREIT Associates, L.P.
(e) No consent to any assumption of the Loan shall occur on or before the first anniversary of the first Payment Date. Thereafter, Lender has received an Additional Insolvency Opinion which may be relied reserves the right to condition the consent required hereunder upon by Lender(i) reasonable and necessary modifications of the non-economic terms hereof and of the Mortgage, the Rating Agencies and their respective successors and assigns, with respect to Note or the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitizationother Loan Documents; (ii) an assumption of this Agreement, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this AgreementNote, the Mortgage and the other Loan DocumentsDocuments as so modified by the proposed transferee, subject, however, subject to the provisions of Section 9.3 hereof 9.4 of this Agreement; (iii) payment of all of the fees and upon expenses incurred in connection with such assumptionTransfer, Borrower shall be released from all liabilities including, without limitation, the cost of any third party reports, legal fees and obligations under expenses, rating agency fees and expenses or required legal opinions; (iv) the payment of a non-refundable $5,000 application fee and an assumption fee equal to one-half percent (0.5%) of the outstanding principal balance of the Loan Documents;
for the first Transfer and one percent (1.0%) of the outstanding principal balance of the Loan for each subsequent Transfer; (v) the delivery of an Additional Insolvency Opinion reflecting the proposed Transfer satisfactory in form and substance to Lender; (vi) following such sale or conveyance the property manager proposed transferee's continued compliance with the representations and covenants set forth in Section 4.1.30 of the Property must be a Qualified Managerthis Agreement; and
(vii) the Transferee pays delivery of evidence satisfactory to Lender a loan assumption fee that the single purpose nature and bankruptcy remoteness of 1% of Borrower, its shareholders, partners or members, as the case may be, following such Transfer are in accordance with the then outstanding principal amount current standards of Lender and the Loan;
Rating Agencies; (viii) ifprior to any release of any Guarantor, after giving effect a substitute guarantor reasonably acceptable to Lender shall have assumed the Guaranty executed by such TransferGuarantor or executed a replacement guaranty reasonably satisfactory to Lender; (ix) if required by Lender, Sponsor does not own at least 51% of confirmation in writing from the equity interests in Borrower and control Borrower, the applicable Rating Agencies have confirmed to the effect that such sale or conveyance, in and of itself, Transfer will not result in a downgradere-qualification, qualification reduction or withdrawal of the then current ratings rating assigned to the SecuritiesSecurities in any applicable Securitization; and
and (ixx) Borrower pays such other conditions as Lender shall determine in its reasonable discretion to be in the interest of Lender’s reasonable costs , including, without limitation, the creditworthiness, reputation and expenses (including any fees due qualifications of the transferee with respect to the Rating Agencies) in connection with Loan and the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Property. Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon any Transfer by Borrower or any Restricted Party without Lender's consent to the extent such consent is required herein. This provision shall apply to every Transfer which requires Lender's consent hereunder regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer. In furtherance of Section 5.2.10(e)(viii) above, Sponsor owns in the event that (x) PREIT Associates, L.P. sells or transfers twenty-five percent (25%) or more of its limited partnership interest in Borrower to any Person who is not less than 51% a Restricted Party as of the equity interests in Borrower date hereof, and controls, directly (y) such sale or indirectly, Borrower;
transfer has been consented to by Lender (ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or saleextent required herein) and otherwise satisfies the criteria set forth above for transfers, which Additional Insolvency Opinion shall be reasonably an additional guarantor (in addition to PREIT Associates, L.P.) acceptable to Lender and, after a Securitization, the Rating Agencies;
(iiiincluding such guarantor's creditworthiness) at the time of shall be permitted to execute an additional guaranty satisfactory to Lender in an amount equal to only such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests transferees respective limited partnership interest in Borrower and control Borrower, the Rating Agencies and PREIT Associates, L.P. shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned execute an amendment to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender Guaranty confirming its reasonable out-of-pocket expenses (including any fees due to obligations under the Rating Agencies) in connection with Guaranty and reducing the same by such amount that the additional guarantor is liable for under such additional guaranty following such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loantransfer.
Appears in 1 contract
Sources: Loan Agreement (Pennsylvania Real Estate Investment Trust)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property. Notwithstanding the foregoing, for purposes hereof, a “Transfer” shall not include Permitted Transfers.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non managing membership interests or the creation or issuance of new non managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions are satisfied:creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(id) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverNotwithstanding the provisions of this Section 5.2.10, Lender’s consent shall not be required ifin connection with one or a series of Transfers, after giving effect of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such Transfer shall result in the change of Control in a Restricted Party, and as a condition to the each such Transfer, Sponsor owns Lender shall receive not less than 51% thirty (30) days prior written notice of the equity interests in such proposed Transfer. In addition, at all times, TNP must continue to Control Borrower and controlsManager and own, directly or indirectly, Borrower;at least a 51% legal and beneficial interest in Borrower and Manager.
(iie) if as a result of any such No Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% Property and assumption of the direct or indirect ownership interests in Borrower immediately Loan shall occur during the period that is sixty (60) days prior to such Transfer and sixty (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, 60) days after a Securitization. Otherwise, Lender’s consent to a one (1) time Transfer of the Rating Agencies;
Property and assumption of the Loan shall not be unreasonably withheld provided that Lender receives sixty (iii60) at the time days prior written notice of such Transfer and no Event of Default has occurred and is continuing, and further provided that the following additional requirements are satisfied:
(i) Borrower shall pay Lender a transfer fee equal to one percent (1%) of the outstanding principal balance of the Loan at the time of such transfer;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(viii) Borrower shall pay, or cause to be paid, to Lender its pay any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs incurred in connection with such sale Transfer (including, without limitation, Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or conveyanceTransferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Property, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not reasonably acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Default or Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements, covenants and legal opinions reasonably required by Lender;
(x) If required by Lender, Transferee shall be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a requalification, reduction, downgrade or withdrawal of the ratings in effect immediately prior to such assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or execute a replacement guaranty and environmental indemnity reasonably satisfactory to Lender;
(xii) Borrower shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policy, as modified by the assumption agreement, as a valid first lien on the Property and naming the Transferee as owner of the Property, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Property shall not be subject to any additional exceptions or liens other than those contained in the Title Policy issued on the date hereof and the Permitted Encumbrances; and
(viixiii) in connection with any The Property shall be managed by Qualified Manager pursuant to a Replacement Management Agreement. Immediately upon a Transfer as a result to such Transferee and the satisfaction of which Sponsor will not own at least 51% all of the equity interests in above requirements, the named Borrower and controlGuarantor herein shall be released from all liability under this Agreement, directly or indirectlythe Note, Borrower, Borrower the Mortgage and the other Loan Documents accruing after such Transfer. The foregoing release shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth effective upon the date the Transfer is expected of such Transfer, but Lender agrees to be effective and provide written evidence thereof reasonably requested by Borrower.
(Af) Lender shall have not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany previous Transfer.
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(bc) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a price to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(d) Notwithstanding the foregoingprovisions of this Section 5.2.10, Lender’s consent shall not be required in connection with (i) one or a sale series of Transfers, of up to forty-nine percent (49%) of the stock in a Restricted Party, the limited partnership interests or conveyance non-managing membership interests (as the case may be) in a Restricted Party (ii) any transfer to Behringer Harvard Funds or an Affiliate of Behringer Harvard Funds (iii) any transfer of an equity interest in Behringer Harvard Funds or any Affiliate thereof or the issuance of additional equity interests in Behringer Holdings or any Affiliate thereof or (iv) any transfer of a direct or indirect equity interest in Borrower to a newly formed entity formed to be the Mezzanine Borrower pursuant to Section 5.2.10(h) below; provided, however, no such Transfer shall result in the change of Control in Borrower, Guarantor or Property Manager. If after giving effect to any such Transfer, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the Closing Date, Borrower shall, no less than thirty (30) days prior to the effective date of any such Transfer, deliver to Lender an Additional Insolvency Opinion acceptable to Lender and the Rating Agencies. In addition, as a condition to any Transfer pursuant to this Section 5.2.10(d), at all times, Guarantor must continue to Control Borrower and own, directly or indirectly, at least a 51% legal and beneficial interest in Borrower.
(e) No consent to any assumption of the Loan shall occur on or before the first (1st) anniversary of the first (1st) Payment Date. Thereafter, Lender’s consent to Transfers of the Property shall not be unreasonably withheld provided that Lender receives sixty (60) days prior written notice of such Transfer and no Event of Default has occurred and is continuing, and further provided that the following additional requirements are satisfied:
(i) Borrower shall pay Lender a transfer fee equal to one-quarter of one percent (0.25%) of the outstanding principal balance of the Loan at the time of the first such transfer and a transfer fee equal to one-half of one percent (0.5%) of the outstanding principal balance of the Loan at the time of each subsequent transfer (provided that no transfer fee shall be payable in connection with any transfer to Behringer Harvard Funds or an Affiliate of Behringer Harvard Funds);
(ii) Borrower shall pay any and all reasonable out-of-pocket costs incurred in connection with such Transfer (including, without limitation, Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or Transferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Property, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not reasonably acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30 and 5.2.9 of this Agreement, no Default or Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements and covenants reasonably required by Lender;
(x) Transferee shall be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a requalification, reduction, downgrade or withdrawal of the ratings in effect immediately prior to such assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion reflecting such Transfer satisfactory in form and substance to Lender;
(xii) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity and any Guaranty of Payment executed by Guarantor or execute a replacement guaranty, environmental indemnity and Guaranty of Payment reasonably satisfactory to Lender (provided that with respect to a Guaranty of Payment any substitute guarantor shall be subject to the net worth requirement set forth in Section 7.5.3 hereof unless otherwise agreed to by Lender in its sole discretion);
(xiii) Borrower or Transferee shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policy, as modified by the assumption agreement, as a valid first lien on the Property and naming the Transferee as owner of the Mortgage (but Property, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Property shall not be subject to any other mortgage, lien additional exceptions or other encumbrance (liens other than those contained in the Title Policy issued on the date hereof and other Permitted Encumbrances Encumbrances; and
(xiv) The Property shall be managed by a Qualifying Property Manager pursuant to a Replacement Management Agreement. Immediately upon a Transfer to such Transferee and Room License Agreements hereafter entered into the satisfaction of all of the above requirements, the named Borrower and Guarantor herein shall be released from all liability under this Agreement, the Note, the Mortgage and the other Loan Documents accruing after such Transfer. The foregoing release shall be effective upon the date of such Transfer, but Lender agrees to provide written evidence thereof reasonably requested by Borrower.
(f) Borrower, without the consent of Lender, may grant easements, restrictions, covenants, reservations and rights of way in the ordinary course of operating business for water and sewer lines, telephone and telegraph lines, electric lines and other utilities or for other similar purposes, provided that no transfer, conveyance or encumbrance shall materially impair the utility and operation of the Property or materially adversely affect the value of the Property or the Net Operating Income of the Property). If Borrower shall receive any consideration in connection with any of said described transfers or conveyances, Borrower shall have the right to use any such proceeds in connection with any alterations performed in connection therewith, or required thereby. In connection with any transfer, conveyance or encumbrance permitted above, the Lender shall execute and deliver any instrument reasonably necessary or appropriate to evidence its consent to said action or to subordinate the Lien of the related Mortgage to such easements, restrictions, covenants, reservations and rights of way or other similar grants upon receipt by the Lender of: (A) is permitted a copy of the instrument of transfer; and (B) an Officer’s Certificate stating with respect to any transfer described above, that such transfer does not materially impair the utility and operation of the Property or materially reduce the value of the Property or the Net Operating Income of the Property.
(g) Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer.
(h) Notwithstanding the provisions of this Section 5.2.10, Lender’s consent shall not be required in connection with Transfers in the nature of a pledge by a Mezzanine Borrower (as defined below) of its direct and/or indirect equity interest in Borrower (but not of any direct interest in the Property) to a Permitted Mezzanine Lender (defined below) as security for a loan to such Mezzanine Borrower (a “Mezzanine Loan”) provided that the following terms and conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Defaultthen exist;
(ii) the Person to whom the Property is sold or conveyed Lender shall have received at least thirty (the “Transferee”30) satisfies the requirements of a Special Purpose Entity and the organizational documents no more than sixty (60) days’ prior written notice of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agenciesproposed Mezzanine Loan;
(iii) if such sale or conveyance occurs the aggregate amount of the Loan and the Mezzanine Loan (as of the effective date of the Mezzanine Loan) shall not exceed eighty percent (80%) of the fair market value of the Property as determined by an independent MAI appraisal dated not more than ninety (90) days prior to the effective date of the Mezzanine Loan and otherwise acceptable to Lender;
(iv) the aggregate Debt Service Coverage Ratio of the Loan and such Mezzanine Loan is at least 1.20 to 1.0;
(v) Borrower shall not be obligated to repay the Mezzanine Loan nor incur any obligation or liability to the Permitted Mezzanine Lender or any other Person with respect to the Mezzanine Loan, and the terms and conditions of the Mezzanine Loan, the collateral pledged as security therefor, and the documents evidencing the Mezzanine Loan, shall be satisfactory to Lender;
(vi) a Securitizationnew Single Purpose Entity shall have been formed that will directly or indirectly own 100% of the Equity Interests in Borrower and Principal (the “Mezzanine Borrower”), the organizational documents of Borrower, such Mezzanine Borrower, and their respective constituent owners shall be satisfactory to Lender, and Borrower and such Mezzanine Borrower shall otherwise satisfy all applicable Rating Agency criteria for single-purpose entities, bankruptcy remoteness, and mezzanine borrowers;
(vii) the Permitted Mezzanine Lender shall have consented executed and delivered to Lender an intercreditor agreement acceptable to Lender in its sole and absolute discretion, provided that Lender’s approval of such sale or conveyance, which consent intercreditor agreement shall not be unreasonably withheld;
, conditioned or delayed so long as it is otherwise in conformance with Rating Agency approved forms for intercreditor agreements (iv) except that Lender has received shall not be required to use any Rating Agency approved form of intercreditor agreement if the Permitted Mezzanine Lender is an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as Affiliate of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the LoanBorrower);
(viii) ifBorrower, after giving effect Principal and Guarantor shall have executed such additional Loan Documents and such amendments to such Transfer, Sponsor does not own at least 51% and reaffirmations of the equity interests in Borrower and control Borrowerexisting Loan Documents as Lender may require, including entering into a cash management arrangement with Lender (or modifying any existing cash management requirement) to provide for, among other things, the Rating Agencies have confirmed that such sale or conveyance, in payment of Lender-approved operating expenses and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned capital expenses prior to the Securities; andpayment of debt service on the Mezzanine Loan;
(ix) Borrower pays Lender’s reasonable costs and expenses the lender under the Mezzanine Loan shall be either (including A) any fees due to person or entity satisfying the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation definition of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
“Qualified Transferee” under clause (ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% definition of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected “Qualified Transferee” set forth in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect form Intercreditor Agreement attached as Appendix VI to the proposed transfer Standard & Poor’s U.S. CMBS Legal and Structural Finance Criteria published May 1, 2003, based on the default values for minimum total assets and capital/statutory surplus or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, shareholders’ equity included in the Rating Agencies;
(iii) at the time definition of “Eligibility Requirements” in such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification publication or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.
Appears in 1 contract
Transfers. (a) Each Borrower acknowledges that Lender has examined and relied on the experience of each Borrower and its members, stockholders, general partners, members, principals and (if any Borrower is a trust) beneficial owners, as applicable, owning and operating properties such as the Properties in agreeing to make the Loan, and will continue to rely on Borrowers’ ownership of the Properties as a means of maintaining the value of the Properties as security for repayment of the Debt and the performance of the Other Obligations. Each Borrower acknowledges that Lender has a valid interest in maintaining the value of the Properties so as to ensure that, should Borrowers default in the repayment of the Debt or the performance of the Other Obligations contained in the Loan Documents, Lender can recover the Debt by a sale of one or more of the Properties.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 5.2.10, no Borrower shall, and Section 2.5 hereof, no Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or Properties owned by such Borrower or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) permit a Sale or Pledge of a direct or indirect any interest in Borrower any Restricted Party or Operating Lessee(iii) incur Indebtedness (other than the Indebtedness permitted pursuant to the terms of this Agreement) (any of the foregoing transactions, a “Transfer”), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.205.1.20 hereof, (B) the Loan Documents and (C) the Mezzanine Loan and the granting of security interests pursuant to the Mezzanine Loan Documents.
(c) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein any Borrower agrees to sell the Property or Properties owned by such Borrower, or any part thereof, for a price to be paid in installments; (ii) an agreement by any Borrower leasing all or substantially all of the Property or Properties owned by such Borrower for other than actual occupancy by a space tenant thereunder, or a sale, assignment or other transfer of, or the grant of a security interest in, such Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of this Section 5.2.10, the following transfers shall not be deemed to be a Transfer, and so long as all of the applicable conditions contained therein shall have been fulfilled, such transfer may occur without consent from Lender: (i) transfers of shares in ▇▇▇▇ Credit Property Trust I, Inc. or ▇▇▇▇ Credit Property Trust III, Inc., (ii) transfers of ownership interests in any Restricted Party and ownership interests in any member, partner or shareholder of any Restricted Party to any Affiliate or subsidiary of a Restricted Party, provided that, at all times, ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇ Holdings Corporation, ▇▇▇▇ Credit Property Trust I, Inc. or ▇▇▇▇ Credit Property Trust III, Inc. continues to Control the Restricted Party provided after giving effect to such transfer, the Person receiving such interest and each Restricted Party who shall exist following such transfer, shall be able to satisfy the requirements and representations set forth in Section 4.1.35, and Section 5.2.10(f), (v), (vii) and (viii), mutatis, mutandis and if the individual or individuals who have direct or indirect Control over the Person to whom such interests are to be transferred is someone other than ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, such individuals shall be reasonably acceptable to Lender, or (iii) the pledge of equity interests in Borrowers and Principal in connection with the Mezzanine Loan, and the exercise of any rights or remedies of Mezzanine Lender (including foreclosure and an assignment in lieu of foreclosure), as applicable, in accordance with and subject to the terms of the Intercreditor Agreement. It shall be a condition of any such transfer specified in the foregoing clause (ii) that Lender shall have received a written confirmation from the parties to the Management Agreement that provides that all Properties, which are the subject of any such transfer or which are directly or indirectly owned by the Restricted Party and/or any member, partner or shareholder of any Restricted Party whose interest were the subject of any such transfer, shall have been removed from the application of such Management Agreement. Lender agrees that, in connection with any transfer contemplated by the foregoing clause (ii), Borrower shall have the right to substitute a replacement guarantor for Guarantor under the Loan Documents, provided that the replacement guarantor (A) shall have a net worth and liquidity sufficient to meet the requirements set forth in Section 5.2 of the Guaranty, (B) shall have made the representations and met the requirements set forth in Sections 4.1.1, 4.1.2, 4.1.3, 4.1.11, 4.1.18, 4.1.37, 4.1.35 and Section 5.2.10(f)(v), (vii) and (viii), which apply to Guarantor, such that the replacement guarantor shall be deemed to make such representations and fulfill such requirements mutatis, mutandis, (C) shall not have been a party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the Room License Agreementsbenefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of such transfer, (D) shall not be involved in any pending or threatened material litigation or regulatory action which is not reasonably acceptable to Lender, and (DE) Permitted Transfersshall not have defaulted under its obligations with respect to any Indebtedness in a manner which is not reasonably acceptable to Lender. Upon the execution and delivery of any documents necessary to consummate such substitution, the original Guarantor shall be released from all liability and obligations under the Guaranty, the Environmental Indemnity and the other Loan Documents with respect to any acts or omissions after any such replacement guarantor shall have executed and delivered a replacement Guaranty and fulfilled all of the conditions set forth in the immediately preceding sentence.
(be) Notwithstanding Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the foregoingDebt immediately due and payable upon a Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, a sale or conveyance by Borrower whether or not Lender has consented to any previous Transfer.
(f) No consent to any assumption of the Property subject to Loan shall occur on or before the lien end of the Mortgage Lockout Period. Thereafter, Lender’s consent to a one (but 1) time Transfer of all of the Properties (which may be to more than one (1) transferee, provided each such transferee shall either be Transferee’s Sponsor or an Affiliate of Transferee’s Sponsor and assumption of the Loan shall not any other mortgagebe unreasonably withheld provided that Lender receives not less than sixty (60) days prior written notice of such Transfer and no Default has occurred and is continuing, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted further provided that the following conditions additional requirements are satisfied:
(i) no Event Borrowers shall pay Lender a transfer fee equal to one percent (1%) of Default shall have occurred and be continuing and the Outstanding Principal Balance at the time of such sale or conveyance shall not result in an Event of DefaultTransfer;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity Borrowers shall pay any and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs incurred in connection with such sale or conveyance; andTransfer (including, without limitation, Lender’s reasonable counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(viiiii) The Persons comprising the proposed transferees (collectively, the “Transferee”), Transferee’s Principal or Transferee’s Sponsor must have demonstrated expertise in connection with any Transfer as a result of which Sponsor will not own at least 51% owning and operating properties similar in location, size, class and operation to each of the Properties, which expertise shall be reasonably determined by Lender;
(iv) Transferee, Transferee’s principal and the owner of equity interests in Transferee who shall replace the original Mezzanine Borrower as contemplated in clause (xv) below (“Replacement Mezzanine Borrower”) shall, as of the date of such transfer, have an aggregate net worth and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice liquidity reasonably acceptable to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.Mezzanine Lender;
Appears in 1 contract
Sources: Loan Agreement (Cole Credit Property Trust III, Inc.)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Properties in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Properties as a means of maintaining the value of the Properties as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Properties so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Properties.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property Properties or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (CB) the Room License AgreementsPermitted Transfers, and (DC) Permitted Transfers.subject to Section 5.1.23 above, any issuance, sale, pledge or transfer of non-controlling interests in ▇▇▇▇ Credit Property Trust III, Inc.
(bc) Notwithstanding Subject to the foregoingexclusions in Section 5.2.10(b), a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (Transfer shall include, but not any other mortgagebe limited to, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and an installment sales agreement wherein Borrower agrees to sell the Properties or any part thereof for a price to be continuing and such sale or conveyance shall not result paid in an Event of Default;
installments; (ii) an agreement by Borrower leasing all or a substantial part of an Individual Property for other than actual occupancy by a space Tenant thereunder or a sale, assignment or other transfer of, or the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements grant of a Special Purpose Entity security interest in, Borrower’s right, title and the organizational documents of the Transferee are reasonably acceptable interest in and to Lender and, after a Securitization, to the Rating Agencies;
any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such sale corporation’s stock or conveyance occurs prior to a Securitization, Lender shall have consented to such sale the creation or conveyance, which consent shall not be unreasonably withheld;
issuance of new stock; (iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lenderif a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the Rating Agencies and their respective successors and assignschange, with respect removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable Sale or Pledge of limited partnership interests or any profits or proceeds relating to Lender or, after a Securitization, such limited partnership interest or the Rating Agencies;
creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the Transferee shall execute an assumptionchange, effective as removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the date membership interest of transfera managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of all non-managing membership interests or the creation or issuance of new non-managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the obligations legal or beneficial interest in a Restricted Party or the creation or issuance of the Borrower thereafter arising new legal or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to beneficial interests.
(d) Notwithstanding the provisions of this Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however5.2.10, Lender’s consent shall not be required ifin connection with one or a series of Transfers, after giving effect of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such Transfer shall result in the change of Control in a Restricted Party, and as a condition to the each such Transfer, Sponsor owns Lender shall receive not less than 51% thirty (30) days prior written notice of the equity such proposed Transfer, and provided, further, all outstanding partnership interests in Borrower and controlsGuarantor shall at all times be owned, directly or indirectly, Borrower;
by ▇▇▇▇ Credit Property Trust III, Inc. If after giving effect to any such Transfer, more than forty-nine percent (ii49%) if in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party as a result of the Closing Date, Borrower shall, no less than thirty (30) days prior to the effective date of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Transfer, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender andand the Rating Agencies. In addition, at all times, ▇▇▇▇ Credit Property Trust III, Inc. must continue to Control Borrower, Guarantor and Manager and own, directly or indirectly, at least a 51% legal and beneficial interest in Borrower, Guarantor and Manager.
(e) No Transfer of the Properties and assumption of the Loan, or Transfer of any direct interest in any Individual Borrower shall occur during the period that is sixty (60) days prior to and sixty (60) days after a Securitization. Otherwise, Lender’s consent to a Transfer of the Rating Agencies;
Properties and assumption of the Loan or Transfer of one hundred percent (iii100%) at of the time outstanding membership or partnership interests in Borrower shall not be unreasonably withheld provided that Lender receives not less than sixty (60) days prior written notice of such Transfer and no Event of Default has occurred and is continuing;, and further provided that the following additional requirements are satisfied:
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vii) Borrower shall pay, pay or cause to be paid, paid to Lender its a transfer fee equal to one percent (1%) of the outstanding principal balance of the Loan at the time of such Transfer, unless the applicable Transfer is a Transfer to an Identified Affiliate that is a ▇▇▇▇ sponsored entity, in which case no transfer fee shall be required;
(ii) Borrower shall pay or cause to be paid any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs incurred in connection with such sale Transfer (including, without limitation, Lender’s reasonable counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or conveyanceTransferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Properties, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall ratify or assume (subject to Section 9.3 hereof) all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not reasonably acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Default or Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements, covenants and legal opinions reasonably required by Lender, provided that such certificates, agreements and covenants shall not materially increase the obligations of Borrower under the Loan Documents or materially decrease the rights of Borrower under the Loan Documents;
(x) If required by Lender, Transferee shall be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a qualification, reduction, downgrade or withdrawal of the ratings in effect immediately prior to such assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or execute a replacement guaranty and environmental indemnity reasonably satisfactory to Lender;
(xii) Borrower shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policies, as modified by the assumption agreement, as valid first liens on the Properties and naming the Transferee as owner of the Properties, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Properties shall not be subject to any additional exceptions or liens other than those contained in the Title Insurance Policies issued on the date hereof and the Permitted Encumbrances;
(xiii) The Properties shall be managed by a Qualified Manager pursuant to a Replacement Management Agreement; and
(viixiv) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion reflecting such Transfer satisfactory in form and substance to Lender. Immediately upon a Transfer to such Transferee and the satisfaction of all of the above requirements, the named Borrower and Guarantor herein shall be released from all liability under this Agreement, the Note, the Mortgages and the other Loan Documents accruing after such Transfer. The foregoing release shall be effective upon the date of such Transfer, but Lender agrees to provide written evidence thereof reasonably requested by Borrower.
(f) No Transfer of any direct interest in a Principal or a manager of an Individual Borrower or of a Principal shall occur during the period that is sixty (60) days prior to and sixty (60) days after a Securitization. Otherwise, Lender’s consent to a Transfer of one hundred percent (100%) of the outstanding membership interests in a Principal or a manager of an Individual Borrower or of a Principal shall not be unreasonably withheld provided that Lender receives not less than sixty (60) days prior written notice of such Transfer and no Event of Default has occurred and is continuing, and further provided that the following additional requirements are satisfied:
(i) The Transferee shall be, or shall be owned and controlled by, an Identified Affiliate;
(ii) Borrower shall pay or cause to be paid any and all reasonable out-of-pocket costs incurred in connection with such Transfer (including, without limitation, Lender’s reasonable counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below), provided that no transfer fee shall be required;
(iii) The Transferee or Transferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Properties, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any Transfer bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall ratify all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not reasonably acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Default or Event of Default shall otherwise occur as a result of which Sponsor will not own at least 51% of the equity interests in Borrower such Transfer, and control, directly or indirectly, Borrower, Borrower Transferee and Transferee’s Principals shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender shall have consented to such Transfer and (B) all certificates, agreements, covenants and legal opinions reasonably required by Lender, provided that such certificates, agreements and covenants shall not materially increase the obligations of Borrower under the Loan Documents or materially decrease the rights of Borrower under the Loan Documents;
(x) If required by Lender, Transferee shall pay be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a qualification, reduction, downgrade or withdrawal of the ratings in effect immediately prior to such assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Intentionally omitted;
(xii) Intentionally omitted;
(xiii) The Properties shall be continue to be managed by a Qualified Manager pursuant to the Management Agreement or a Replacement Management Agreement; and
(xiv) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender a loan assumption fee an Additional Insolvency Opinion reflecting such Transfer satisfactory in form and substance to Lender.
(g) Lender shall not be required to demonstrate any actual impairment of 1% its security or any increased risk of default hereunder in order to declare the then outstanding principal amount Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of the Loanwhether voluntary or not, or whether or not Lender has consented to any previous Transfer.
Appears in 1 contract
Sources: Loan Agreement (Cole Credit Property Trust III, Inc.)
Transfers. 14.%2.%3.%4. Borrower acknowledges that Lender has examined and relied on the experience of Pledgor and Operating Company and their respective stockholders, general partners, members, principals and (if Pledgor or Operating Company is a trust) beneficial owners in owning the Collateral in agreeing to make the Loan, and will continue to rely on Pledgor’s ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Collateral so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Collateral.
(a) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 and (DB) Permitted Transfers.
(b) Notwithstanding A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the foregoingCollateral, or any part thereof, Senior Mezzanine Borrower agrees to sell the Senior Mezzanine Collateral, or any part thereof, or Mortgage Borrower agrees to sell the Property or any part thereof, in each case, for a sale price to be paid in installments; (ii) with the exception of the Operating Lease, an agreement by Mortgage Borrower or conveyance by Borrower Operating Company leasing all or a substantial part of the Property subject for other than actual occupancy by a space Tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Mortgage Borrower’s or Operating Company’s respective right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the lien creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the Mortgage partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (but not v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(c) Notwithstanding the provisions of this Section 5.2.10 or any other mortgageprovision of this Agreement or the Loan Documents, lien or other encumbrance and provided in each case that (i) the Mortgage Loan and the Senior Mezzanine Loan shall have been repaid in full (other than contingent liabilities under the Permitted Encumbrances Mortgage Loan Documents and Room License Agreements hereafter entered into the Senior Mezzanine Loan Documents) or (ii) Mortgage Lender’s and Senior Mezzanine Lender’s consent to such Transfer is not required under the Mortgage Loan Documents or Senior Mezzanine Loan Documents or shall have been obtained, Lender’s consent shall not be required in connection with (A) one or a series of Transfers, of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party (including the amendment of the organizational documents of such Restricted Party solely for the purpose of reflecting such Transfers), provided, however, no such Transfer shall result in the change of Control in a Restricted Party, (B) transfers, issuances, conversions and redemptions of stock, membership interests and partnership interests in any one or more AHT Corporate Pledge Entities (but excluding pledges other than pledges under the Existing Corporate Financing) and, following a Qualified Prime Transfer, AHP Corporate Pledge Entities (but excluding pledges other than pledges under the AHP Corporate Financing), (C) all transfers of worn out or obsolete furnishings, fixtures or equipment that are reasonably promptly replaced with property of equivalent value and functionality in the ordinary course of operating operation of the Property), (D) all Transfers (including Permitted Encumbrances) to the extent expressly permitted under any other provision of this Agreement or the Loan Documents, (E) Transfers of stock, membership interests or partnership interests in any one or more AHT Corporate Pledge Entities pursuant to an exercise of remedies by the lenders (or an administrative agent on behalf of such lenders) under the Existing Corporate Financing, provided, that, each such lender (and any such administrative agent) is permitted then an institutional lender, (F) Transfers of stock, membership interests or partnership interests in any one or more AHP Corporate Pledge Entities pursuant to an exercise of remedies by the lenders (or an administrative agent on behalf of such lenders) under the AHP Corporate Financing, provided that each such lender (and any such administrative agent) is then an institutional lender, and (G) a Qualified Prime Transfer. Provided, further, that (I) for so long as the following conditions Loan, the Mortgage Loan or the Senior Mezzanine Loan shall remain outstanding, (x) no pledge or other encumbrance of any direct interests in Borrower, Senior Mezzanine Borrower, Mortgage Borrower, Principal, Operating Company, Leasehold Pledgor or Senior Mezzanine Pledgor shall be permitted (except for liens and encumbrances created by the Loan Documents, the Mortgage Loan Documents or the Senior Mezzanine Loan Documents, as applicable); and (y) none of Borrower, Mortgage Borrower, Principal, Operating Company, Leasehold Pledgor, Senior Mezzanine Pledgor or Senior Mezzanine Borrower shall issue preferred equity that has the characteristics of mezzanine debt (such as a fixed maturity date, regular payments of interest, a fixed rate of return and rights of the equity holder to demand repayment of its investment), and (II) as a condition to each Transfer described in clause (A) or (E) (as to any such Transfer arising prior to a Qualified Prime Transfer) above (1) of more than twenty percent (20%) of the then-outstanding direct or indirect ownership interests in the Person that is the subject of such Transfer or (2) that would result in a change of Control of such Person, Lender shall receive not less than thirty (30) days’ prior written notice of such proposed Transfer. If after giving effect to any such Transfer described in clause (A), (E) or (F) above, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are satisfied:owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the Closing Date, Borrower shall, no less than thirty (30) days prior to the effective date of any such Transfer, deliver to Lender an Additional Insolvency Opinion. In addition, and notwithstanding anything to the contrary in this Section 5.2.10(d), at all times (x) prior to a Qualified Prime Transfer, AHLP must continue to Control Borrower and Leasehold Pledgor and own, directly or indirectly, at least a fifty-one percent (51%) direct or indirect legal and beneficial interest in each of Borrower and Leasehold Pledgor and (y) upon the occurrence of a Qualified Prime Transfer, and at all times thereafter, AHPLP must continue to Control Borrower and Leasehold Pledgor and own, directly or indirectly, at least a fifty-one percent (51%) direct or indirect legal and beneficial interest in each of Borrower and Leasehold Pledgor. In addition to and not in limitation of the foregoing, Lender’s consent shall not be required in connection with a Transfer of direct or indirect interests in Borrower and Leasehold Pledgor made by Senior Mezzanine Borrower to secure the Senior Mezzanine Loan in accordance with the Senior Mezzanine Loan Documents.
(id) Other than a Qualified Prime Transfer, no Event Transfer of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents assumption of the Transferee are reasonably acceptable Loan shall occur during the period that is sixty (60) days prior to Lender and, and sixty (60) days after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization. Otherwise, Lender shall have consented consent to a one (1) time Transfer of the Property or the legal or beneficial direct or indirect ownership interests therein or in Borrower and Leasehold Pledgor (if such sale or conveyanceTransfer is not made in accordance with Section (d) above) and an assumption of the entire Loan pursuant to this Section 5.2.10(e), which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assignsconditioned or delayed, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
Lender receives sixty (i60) if such sale or conveyance occurs days’ prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time written notice of such Transfer and no Event of Default has occurred and is continuing, and further provided that the following additional requirements are satisfied:
(i) Borrower shall pay Lender a transfer fee equal to one percent (1%) of the outstanding principal balance of the Loan at the time of such transfer;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(viii) Borrower shall pay, or cause to be paid, to Lender its pay any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs incurred in connection with such sale Transfer (including, without limitation, Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Approved Rating Agencies pursuant to clause (x) below);
(iii) the proposed transferee (the “Transferee”) or conveyance; andTransferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Property, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been the subject of any Bankruptcy Action within seven (7) years prior to the date of the proposed Transfer (other than an involuntary Bankruptcy Action that was not consented to by such Person and was discharged or dismissed within ninety (90) days of the date such Bankruptcy Action was filed);
(vi) with respect to a Transfer of the Property, Transferee shall assume all of the obligations of Mortgage Borrower and Operating Company, as applicable, under the Mortgage Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) there shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or any Related Entities which, in connection each case, is not reasonably acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) with respect to any Transfer of the Property, Transferee must be able to satisfy all representations and covenants in Sections 4.1.30 and 4.1.40 as Transferee, and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Default or Event of Default shall otherwise occur as a result of which Sponsor will not own at least 51% of the equity interests in Borrower such Transfer, and control, directly or indirectly, Borrower, Borrower Transferee shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and, following a Securitization, satisfactory to the Approved Rating Agencies and (B) all certificates, agreements and legal opinions reasonably required by Lender;
(x) if required by Lender, Transferee shall be approved by the Approved Rating Agencies, which approval, if required by Lender, shall take the form of a Rating Agency Confirmation with respect to such assumption or Transfer;
(xi) prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or execute a replacement guaranty and environmental indemnity reasonably satisfactory to Lender and delivered an Additional Insolvency Opinion covering the replacement guarantor;
(xii) Borrower shall deliver, at its sole cost and expense, a new UCC Title Insurance Policy or, if reasonably acceptable to Lender, an endorsement to the existing UCC Title Insurance Policy, insuring Lender’s valid first lien on the Collateral and naming the Transferee as owner of the Collateral, which new policy or endorsement shall insure that, as of the date of the recording of the assumption agreement, the Collateral shall not be subject to any additional exceptions or liens other than those contained in the relevant UCC Title Insurance Policy issued on the date hereof and the Permitted Encumbrances relating thereto;
(xiii) the Property shall be managed by Manager or a Qualified Manager pursuant to the Management Agreement or a Replacement Management Agreement;
(xiv) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender (i) an Additional Insolvency Opinion reflecting such Transfer satisfactory in form and substance to Lender and (ii) such other bankruptcy related opinions as shall be requested by Lender, including an opinion that no fraudulent conveyance or preference results from the transfer of the Property and the assumption by the Mezzanine Entities of the obligations of Borrower of the Loan Documents;
(xv) the Senior Mezzanine Loan shall have been repaid in full (other than contingent liabilities under the Senior Mezzanine Loan Documents) or Senior Mezzanine Lender shall have consented in writing to such Transfer Transfer, or the Senior Mezzanine Loan shall be assumed by Transferee or its Affiliates in accordance with the terms and conditions contained in the Senior Mezzanine Loan Documents;
(xvi) all of the entities which own interests in the Transferee similar to the interests in Mortgage Borrower owned by Borrower (collectively, the “Mezzanine Entities”) (i) shall assume the Loan and all the agreements of Borrower under the Loan Documents (and without limiting the foregoing, all of the ownership interests in the Transferee, as applicable, all payments thereon and all proceeds thereof shall be pledged to Lender on terms no less favorable than the pledge of the Collateral under the Pledge Agreement), which shall be evidenced by new loan documents substantially similar (in form and substance) to the Loan Documents and otherwise reasonably acceptable to Lender in order to properly reflect the new ownership structure and the pledge of the interests thereunder, (ii) shall each be a bankruptcy-remote Special Purpose Entity, and (iii) shall otherwise have a legal, financial and ownership structure that is (A) substantially the same as Borrower, or (B) Borrower shall pay at least as favorable to Lender, as determined by Lender a loan assumption fee in its reasonable discretion, as the legal, financial and ownership structure of 1% of the then outstanding principal amount of the Loan.Borrower;
(xvii) Le
Appears in 1 contract
Sources: Junior Mezzanine Loan Agreement (Ashford Hospitality Prime, Inc.)
Transfers. (a) Without Except as otherwise permitted by the prior written consent provisions of Lender, and this Section 15.13 or except to the extent otherwise set forth permitted elsewhere in this Section 5.2.10 and Section 2.5 hereofthe Loan Documents, Borrower shall not, and shall will not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, permit or otherwise transfer or dispose of suffer (voluntarily or involuntarily, by operation of law or otherwise) any sale, and whether assignment, conveyance, transfer and/or other disposition of legal or not for consideration equitable interest in all or any part of recordthe Project or the Ground Lease, (ii) the Property permit or suffer (by operation of law or otherwise) any sale, assignment, conveyance, transfer or other disposition of any direct or indirect ownership interest thereinin Borrower, or (iiiii) permit a Sale or Pledge suffer (by operation of law or otherwise) any mortgage, lien and/or other encumbrance of all or any part of the Project or the Ground Lease, (iv) permit or suffer (by operation of law or otherwise) any pledge, hypothecation, creation of a security interest in and/or other encumbrance of any direct or indirect ownership interest in Borrower or Operating LesseeBorrower’s constituent entities, other than or (Av) file a declaration of condominium with respect to the Operating LeaseProject (each, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfersa “Transfer”).
(b) Notwithstanding the foregoingA sale, a sale or conveyance by assignment, conveyance, transfer and/or other disposition of direct and/or indirect ownership interests in Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is shall be permitted provided that if the following conditions are satisfied:
(i) no Event No Change in Control has occurred (or will occur by reason of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of DefaultTransfer);
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at At the time of such Transfer Transfer, no Event of Default has occurred and is continuing;
(iviii) following such Transfer After giving effect to the property manager of the Property must proposed Transfer, Borrower will continue to be a Qualified ManagerSpecial Purpose Entity;
(viv) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender Agent of the proposed Transfer transfer or sale not later than fifteen ten (1510) days (or such lesser time as Agent shall agree) prior thereto, which notice shall set forth (A) the name of the Person proposed transferee or the person to which the interests in Borrower are to be transferred or sold, (B) the interest to be transferred and (C) the date the transfer or sale is expected to be effective;
(v) The transferee is not a Prohibited Person; and
(vi) As to any Transfer of twenty percent (20%) or more of the beneficial ownership interest in Borrower (whether as a result of a Transfer of a direct interest in Borrower or an indirect interest in Borrower): (x) if the proposed Transfer is of all or any part of the interest in Borrower directly or indirectly owned by TRG or an Affiliate of TRG, the transferee shall not be (and shall not be an Affiliate of any Person who is) involved in any material litigation or arbitration proceeding in which a Lender is an adverse party, provided that the foregoing shall not apply to be transferred, identify transfers of interests in TRG and (y) if the proposed transferee and set forth the date the Transfer is expected to be effective of all or any part of the interest in Borrower owned by a Person other than TRG or an Affiliate of TRG and if such Transfer requires the consent of TRG (Aor of any general partner of Borrower which is an Affiliate of TRG) Lender under Borrower’s partnership agreement, then TRG (or any such Affiliate of TRG) shall have consented not consent to such Transfer unless the transferee has certified in writing to TRG and Agent that the transferee (and its Affiliates) are not involved in any material litigation or arbitration proceeding in which a Lender is an adverse party.
(c) Additionally, a pledge, hypothecation, creation of a security interest and/or other encumbrance by the holder (other than TRG or any Affiliate of TRG) of a direct and/or indirect ownership interest in Borrower shall be permitted so long as, assuming foreclosure of such pledge or security interest, the requirements of clauses (i), (iii) and (Bv) or subparagraph (b) above would be satisfied.
(d) The foregoing transfer restrictions will not restrict sales, conveyances, transfers, pledges or grants of security interests of direct and/or indirect ownership interests (x) in TRG, so long as the transferee (excluding any shareholder of TCI) is not a Prohibited Person or (y) in any Person other than TRG or an Affiliate of TRG holding any direct or indirect ownership interests in Borrower, so long as (i) after giving effect to such Transfer described in this clause (y) no Change in Control would occur as a result of such Transfer, (ii) the transferee is not a Prohibited Person and (iii) the requirement set forth in Section 15.13(a)(vi)(y) is satisfied, if applicable. Borrower shall pay give or cause to Lender a loan assumption fee of 1% be given written notice to Agent of the then outstanding principal amount Transfer described in clause (y) above within five (5) Business Days after TRG discovers or is informed about any such Transfer; provided that Borrower shall not be obligated to notify Agent of Transfer of minority interests (direct or indirect) in CSAT, L.P. constituting less than twenty percent (20%) of the Loanbeneficial ownership interests in Borrower.
(e) Lenders shall not be required to demonstrate any actual impairment of their security or any increased risk of default hereunder in order to declare the Loan immediately due and payable upon any violation of this Section 15.13.
Appears in 1 contract
Sources: Loan Agreement (Taubman Centers Inc)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Owner and its beneficial owners in owning properties such as the Properties in agreeing to make the Loan, and will continue to rely on Owner’s ownership of the Properties as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Properties so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Collateral.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise expressly permitted and set forth in Article 2 or this Section 5.2.10 and Section 2.5 hereof5.2.11, Borrower shall not, shall not permit Owner to and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the any Individual Property or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) permit a Sale or Pledge of a direct or indirect ownership interest in Borrower or Operating Lesseeany Restricted Party (collectively, a “Transfer”), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale 5.1.20 or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale permit a Sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale Pledge of all or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as any part of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyanceCollateral.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Owner agrees to sell an Individual Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Owner leasing all or a substantial part of an Individual Property for other than actual occupancy or actual operation by a tenant or operator thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of this Section 5.2.10 or any other provisions of any Loan Document, the following shall be permitted without the consent of Lender or Servicer: (i) the Sale or Pledge or other encumbrance) Transfer, in one or a series of any direct or transactions, of indirect ownership interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if immediately after such sale or conveyance occurs prior Transfer Guarantor must continue to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Control Borrower and controlsown, directly or indirectly, Borrower;at least a 51% interest in Borrower and the Sale or Pledge or other Transfer of any ownership interest in Guarantor. As used herein, the term “Control” means the possession, directly or indirectly of the power to direct or cause the direction of the management and policies of the Person in question through the ownership of voting securities, by contract or otherwise.
(iie) No consent to any assumption of the Loan shall occur on or before the first anniversary of the first Payment Date. Thereafter, Lender reserves the right to condition the consent required hereunder upon (a) a modification of the terms hereof, the Note, the Pledge or the other Loan Documents; (b) an assumption of this Agreement, the Note, the Pledge and the other Loan Documents as so modified by the proposed transferee, subject to the provisions of Section 9.4 hereof; (c) payment of all of fees and expenses incurred in connection with such Transfer including, without limitation, the cost of any third party reports, legal fees and expenses, Rating Agency fees and expenses or required legal opinions; (d) the payment of a non-refundable $5,000 application fee and an assumption fee equal to one percent (1%) of the outstanding principal balance of the Loan; (e) the delivery of a nonconsolidation opinion reflecting the proposed transfer satisfactory in form and substance to Lender; (f) the proposed transferee’s continued compliance with the representations and covenants set forth in Section 4.1.30 and Section 5.2.9 hereof; (g) the delivery of evidence satisfactory to Lender that the single purpose nature and bankruptcy remoteness of Borrower, its shareholders, partners or members, as the case may be, following such transfers are in accordance with the then current standards of Lender and the Rating Agencies; (h) prior to any release of the Guarantor, a substitute guarantor acceptable to Lender shall have assumed the Guaranty executed by Guarantor or executed a replacement guaranty reasonably satisfactory to Lender; (i) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon required by Lender, confirmation in writing from the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, transfer will not result in a downgradere-qualification, qualification reduction or withdrawal of the then current ratings rating assigned to the SecuritiesSecurities or any class thereof in any applicable Securitization; (j) such other conditions as Lender shall determine in its reasonable discretion to be in the interest of Lender, including, without limitation, the creditworthiness, reputation and qualifications of the transferee with respect to the Loan and the Collateral; and (k) if the Properties are being transferred, a concurrent assumption of the Senior Loan by one or more wholly owned subsidiaries of the transferee with the consent of Senior Lender pursuant to Section 5.2.10(e) of the Senior Loan Agreement.
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (Af) Lender shall have not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon a Transfer without Lender’s consent. This provision shall apply to every Transfer other than a Transfer permitted under Section 5.2.10(b) or (d) regardless of whether voluntary or not, or whether or not Lender has consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany previous Transfer.
Appears in 1 contract
Transfers. (a) Each Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if either Borrower is a trust) beneficial owners in owning and operating properties such as the Property, as applicable, in agreeing to make the Loan, and will continue to rely on such Borrower's ownership of its Property as a means of maintaining the value of such Property as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Each Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should such Borrower default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Property, as applicable,.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 5.2.10, neither Borrower shall, and Section 2.5 hereof, neither Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, grant a security interest in, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party (collectively, a "Transfer"), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20.
(c) A Transfer shall include, but not be limited to, (Ci) an installment sales agreement wherein such Borrower agrees to sell its Property or any part thereof for a price to be paid in installments; (ii) an agreement by such Borrower leasing all or a substantial part of its Property for other than actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, such Borrower's right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation's stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the Room License Agreementsremoval or the resignation of the Manager (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(d) Notwithstanding the provisions of this Section 5.2.10, the following transfers shall not be deemed to be a Transfer: (i) the Sale or Pledge, in one or a series of transactions, of not more than forty-nine percent (49%) of the stock in a Restricted Party; provided, however, no such Sale or Pledge shall result in the change of voting control in the Restricted Party, and as a condition to each such Sale or Pledge, Lender shall receive not less than thirty (30) days prior notice of such proposed Sale or Pledge, (ii) the Sale or Pledge, in one or a series of transactions, of the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such Sale or Pledge shall result in the change of voting control in the Restricted Party, (iii) the Sale or Pledge of stock in ▇▇▇▇▇▇▇ Properties, Inc. (the "Traded Entity"), provided such stock is listed on the New York Stock Exchange or such other nationally recognized stock exchange, or any Sale or Pledge or other transaction that would otherwise constitute a transfer hereunder with respect to a Person in its capacity solely as the holder of Traded Equity (and in no other capacity), and (Div) Permitted Transfersthe adjustment of partnership units held by partners in Principal to reflect redemptions pertaining to the limited partner interests in Principal. In addition, at all times, ▇▇▇▇▇▇▇ Properties, Inc. must continue to, directly or indirectly, control (subject only to customary reservations of rights in favor of other partners or members to approve the sale and/or refinancing of all or substantially all of the entity's assets and other major decisions) Borrowers, Guarantor and Affiliated Manager and own, directly or indirectly, at least a 51% interest in Borrower, Guarantor and Affiliated Manager.
(be) Notwithstanding the foregoingLender shall not withhold its consent to a Transfer of either Property to a Permitted Transferee (including, without limitation, an Affiliate of Borrower that is a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)Transferee) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
remain uncured; (ii) the Person Permitted Transferee shall have executed and delivered to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of Lender a Special Purpose Entity and the organizational documents modification of the Transferee are reasonably terms hereof, the Note, the Mortgage or the other Loan Documents in form and substance acceptable to Lender and, after a Securitization, to the Rating Agencies;
Lender; (iii) if such sale or conveyance occurs prior to a Securitization, Lender the Permitted Transferee shall have consented executed and delivered to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lenderassumption of this Agreement, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this AgreementNote, the Mortgage and the other Loan Documents as so modified by the Permitted Transferee in form and substance acceptable to Lender, evidencing such Permitted Transferee's agreement to abide and be bound by the terms of the Note, this Agreement and the other Loan Documents, subject, however, subject to the provisions of Section 9.3 hereof 10.4 hereof; (iv) Lender shall have received payment of all of out-of-pocket fees and upon expenses incurred in connection with such assumptiontransfer including, Borrower without limitation, all of Lender's out-of-pocket expenses in connection with the approval of such transfer, the cost of any third party reports, reasonable legal fees and expenses, Rating Agency fees and expenses or required legal opinions; (v) Lender shall be released from all liabilities and obligations under the Loan Documents;
have received payment of a non-refundable $5,000 application fee; (vi) following such sale or conveyance Lender shall have received payment of an assumption fee (the property manager "Assumption Fee") equal to 0.50% of the Property must Outstanding Principal Balance on the date of such transfer or assumption for any transfer or assumption of the Loan, provided however, that the Assumption Fee shall not be a Qualified Managerapplicable to the first transfer or assumption following the Closing Date; and
(vii) the Permitted Transferee pays shall have delivered to Lender a loan assumption fee nonconsolidation opinion reflecting the proposed transfer satisfactory in form and substance to Lender, in its sole discretion, and, in the case of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect an Transfer to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrowera non-Institutional Investor, the Rating Agencies in their sole discretion; (viii) Lender shall have confirmed received satisfactory evidence of the Permitted Transferee's continued compliance with the representations and covenants set forth in Section 4.1.30 and Section 5.2.9 hereof; (ix) Lender shall have received satisfactory evidence that the single purpose nature and bankruptcy remoteness of the Permitted Transferee, and as applicable, its shareholders, partners or members, as the case may be, following such transfers are in accordance with the then current standards of Lender and the Rating Agencies; (x) prior to any release of the Guarantor, a substitute guarantor reasonably acceptable to Lender shall have assumed the Guaranty executed by Guarantor or executed a replacement guaranty reasonably satisfactory to Lender (and, upon the effective date of such assumption or replacement guaranty, the Guarantor will be released); and (xi) if required by Lender, confirmation in writing from the Rating Agencies to the effect that such sale or conveyance, in and of itself, transfer will not result in a downgradere-qualification, qualification reduction or withdrawal of the then current ratings rating assigned to the SecuritiesSecurities or any class thereof in any applicable Securitization; andprovided that notwithstanding the foregoing, no such Rating Agency confirmation shall be required in connection with a Transfer to an Institutional Investor.
(ixf) Lender shall not withhold its consent to a Transfer of the membership interests in Borrowers by NSHE to Principal, provided that (i) no Event of Default shall have occurred and remain uncured; (ii) the following documents are delivered to Lender pursuant to the Qualified Exchange Accommodation Agreement: (A) an assumption and acknowledgement of this Agreement, the Note, the Mortgage and the other Loan Documents evidencing Principal's agreement to cause Borrowers to abide and be bound by the terms of the Note, this Agreement and the other Loan Documents, (B) a joinder of Guarantor affirming that the Guaranty and the Environmental Indemnity remain in full force and effect, (C) an Officer's Certificate confirming that neither Borrower pays Lender’s reasonable costs nor Lender is in default of any of its obligations under any of the Loan Documents and that no defenses, offsets or counterclaims exist under the Loan Documents, (D) Lender shall have received payment of all of fees and expenses (including any fees due to the Rating Agencies) incurred in connection with such transfer including, without limitation, all of Lender's out-of-pocket expenses in connection with the sale review and/or approval of such transfer, the cost of any third party reports, legal fees and expenses, Rating Agency fees and expenses or conveyancerequired legal opinions; (E) an Additional Insolvency Opinion, in form and substance reasonably satisfactory to Lender and the Rating Agencies, if facts or circumstances stated or assumed in the Insolvency Opinion have changed so that the facts stated and/or assumptions made therein are no longer correct); (F) Lender shall have received satisfactory evidence of each Borrower's continued compliance with the representations and covenants set forth in Section 4.1.30 and Section 5.2.9 hereof; (G) Lender shall have received satisfactory evidence that the single purpose nature and bankruptcy remoteness of the Borrowers, and as applicable, its shareholders, partners or members, as the case may be, following such transfers are in accordance with the then current standards of Lender and the Rating Agencies; and (H) if required by Lender due to changes in facts and circumstances, confirmation in writing from the Rating Agencies to the effect that such transfer will not result in a re-qualification, reduction or withdrawal of the then current rating assigned to the Securities or any class thereof in any applicable Securitization.
(cg) A Transfer (but not Lender hereby consents to a pledge, hypothecation, creation pledge of a security interest in or other encumbrance) of any the direct or indirect interests in Principal or in another Person(s) owning a direct or indirect interest in either Borrower is permitted (it being understood that pledges of direct interests in either Borrower shall not be permitted), provided that the following conditions are satisfied:
satisfied (i) if such sale pledge is made to an Institutional Investor, including an Institutional Investor acting as agent for a group of lenders, that is not an Affiliate of Principal or conveyance occurs prior Guarantor; (ii) Principal or such other Person(s) whose interests are pledged owns substantial assets in addition to its direct or indirect equity interests in either Borrower; and (iii) any such consent will apply only to the making of such pledge in Principal or such other Person(s) and the acceptance thereof by such Institutional Investor, including an Institutional Investor acting as agent for a Securitizationgroup of lenders, and whatever rights such Institutional Investor may have in connection with such pledge, including but not limited to the right to foreclose on, or otherwise take action on, the pledged interests, will remain subject to the provisions of Section 5.2.10 of this Agreement.
(h) Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required ifto demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Obligations immediately due and payable upon a transfer without Lender's consent. This provision shall apply to every Transfer regardless of whether voluntary or not, after giving effect or whether or not Lender has consented to the Transfer, Sponsor owns not less than 51% any previous Transfer of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the LoanProperty.
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Agent and Lender have examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners, as applicable, in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Agent and Lender have a valid interest in maintaining the value of the Property so as to ensure that, during the continuance of an Event of Default, Agent and Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, Agent and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (in each case, directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) or permit the change of Control of the Property or any direct part thereof or indirect any legal or beneficial interest therein, directly or indirectly, at any tier of ownership, except with respect to any Transfers with respect to Leases otherwise expressly permitted under this Agreement, (ii) permit a Sale or Pledge of a direct or indirect any interest in Borrower any Restricted Party, directly or Operating Lesseeindirectly, at any tier of ownership (any of the actions in the foregoing clauses (i) or (ii), a “Transfer”), or (iii) suffer or permit any such Transfer described in this Section 5.2.10 to occur by or in a Restricted Party, directly or indirectly, at any tier of ownership, in each case, other than (A) the Operating Lease, (B) pursuant to Leases leasing of space in the Improvements to tenants Tenants pursuant to Leases entered into in accordance with the provisions of Section 5.1.205.1.21 hereof, (B) Permitted Transfers, (C) Permitted Encumbrances, (D) any Transfer by Borrower to Agent or its designee or other Transfer resulting from the Room License Agreementsexercise by Agent or Lender of its rights and remedies under the Loan Documents, (E) any Mezzanine Loan Liens, and (DF) Permitted Transfersthe Transfer of direct and/or indirect interests in Borrower or Mezzanine Borrower or other Transfer resulting from the exercise by Mezzanine Agent of its right and remedies under the Mezzanine Loan Documents.
(bc) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property, or any part thereof, for a price to be paid in installments; (ii) an agreement by Borrower leasing all or substantially all of the Property or all or substantially all of a building located on the Property for other than actual occupancy by a space tenant thereunder, or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non‑member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non‑managing membership interests or the creation or issuance of new non‑managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the foregoingprovisions of Sections 5.2.10(a)‑(c), Borrower and any Restricted Party shall be permitted without Agent’s consent to effect, and nothing in the Loan Documents shall be deemed to prohibit, one or a sale or conveyance by Borrower series of Transfers, of not more than forty-nine percent (49%) in the aggregate of the Property subject to the lien of the Mortgage (but not any other mortgageindirect ownership interests in Borrower, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
: (i) no Event of Default shall have occurred and be continuing and remain outstanding or shall occur solely as a result of such sale or conveyance shall not result in an Event of Default;
Transfer; (ii) such Transfer shall not (A) cause the Person transferee, together with its Affiliates, to whom acquire Control of Borrower, (B) result in Borrower no longer being Controlled by one or more Sponsors, or (C) cause the Property is sold transferee, alone or conveyed together with its Affiliates, to increase its direct or indirect interest in Borrower to an amount which exceeds forty-nine percent (49%) in the “Transferee”aggregate; (iii) satisfies to the requirements of a Special Purpose Entity and extent the organizational documents transferee owns ten percent (10%) or more of the Transferee are direct or indirect interests in Borrower immediately following such Transfer (provided that such transferee did not own ten percent (10%) or more of the direct or indirect ownership interests in such Borrower as of the closing date), Borrower shall deliver, at Borrower’s sole cost and expense, customary searches (OFAC, Lender’s customary “know your customer” searches, credit, judgment, litigation, lien, bankruptcy and anything else Agent or Lender then customarily requires) reasonably acceptable to Lender andAgent with respect to such transferee and its Affiliates as Agent may reasonably require (provided, after a Securitizationhowever, to the Rating Agencies;
(iii) if such sale transferee is a newly formed, wholly owned, direct or conveyance occurs prior indirect subsidiary of Sponsor, such that such transfer does not change the ultimate ownership of Borrower, then Borrower shall only be required to a Securitization, Lender shall have consented to provide notice of such sale or conveyance, which consent shall not be unreasonably withheld;
transfer within ten (10) Business Days following the date thereof); (iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own one or more Sponsors shall continue to own, collectively, directly or indirectly, in the aggregate, at least 51% fifty percent (50%) of all legal, beneficial and economic interests in Borrower; (v) the Property shall continue to be managed by Manager or a Qualified Manager; (vi) Borrower shall give Agent notice of such proposed Transfer, together with copies of all instruments effecting such Transfer and copies of any organizational documents, including without limitation, a revised organizational structure chart, that Agent shall reasonably require, not less than ten (10) business days prior to the proposed date of such Transfer; (vii) the organizational structure of Borrower (including, without limitation, its single purpose nature and bankruptcy remoteness) shall not be adversely affected by such Transfer; and (viii) either (A) Agent shall be reasonably satisfied that, under the terms of the equity interests in Borrower and control BorrowerLoan Documents, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned Lender’s consent to the Securities; and
proposed Transfer is not required, or (ixB) Borrower pays Lender’s reasonable costs and expenses (including any fees due Agent receives evidence, reasonably satisfactory to Agent, that Lender has given the Rating Agencies) in connection with the sale or conveyancerequisite consent.
(ce) A In addition, notwithstanding a the provisions of Sections 5.2.10(a)‑(c), Borrower and any Restricted Party shall be permitted without Agent’s consent to effect, and, nothing in the Loan Documents shall be deemed to prohibit, the following:
(i) the Transfer of any direct or indirect interests in Savanna JV Partner, provided (but not A) the conditions detailed in Sections 5.2.10(d)(i) through (viii) above remain satisfied, (B) Savanna Sponsor continues to own fifty-one percent (51%) or more of the membership interest (directly or indirectly) in Savanna JV Partner, (C) there is no change in control of Savanna Sponsor as a pledge, hypothecation, creation result of such Transfer and (D) there is no change in Control of Borrower as a security interest in or other encumbranceresult of such Transfer;
(ii) the Transfer of any direct or indirect interests in Borrower by KBS Sponsor, provided (A) the conditions detailed in Section 5.2.10(d)(i) through (viii) above remain satisfied, (B) KBS Sponsor continues to own fifty one percent (51%) or more of the membership interest (directly or indirectly) in KBS JV Partner, (C) there is permitted no change of control of KBS Sponsor and (D) there is no change in Control of Borrower as a result of such Transfer;
(iii) the Transfer of any direct or indirect interests in Borrower by Savanna Sponsor (including, without limitation, transfers of limited partner interests in Guarantor or SREF III ▇▇▇▇▇▇▇ Co-Invest L.P.), provided (A) the conditions detailed in Section 5.2.10(d)(i) through (viii) above remain satisfied, (B) Savanna Sponsor continues to own fifty one percent (51%) or more of the membership interests (directly or indirectly) in Savanna JV Partner, (C) there is no change of Control of Savanna Sponsor, and (D) there is no change in Control of Borrower as a result of such Transfer (provided that the following existence of major decision rights shall not in itself constitute Control with respect to (C) and (D));
(iv) the Transfer of all or any portion of KBS JV Partner’s ownership interest in the JV Entity to Savanna JV Partner, provided the conditions are detailed in Section 5.2.10(d)(i), (ii)((B) and (iii) through (viii) above remain satisfied:;
(v) the Transfer of all or any portion of Savanna JV Partner’s ownership interest in the JV Entity to KBS JV Partner, provided the conditions detailed in Section 5.2.10(d)(i), (ii)((B) and (iii) through (viii) above remain satisfied; or USActive 36631986.12 -113-
(vi) the removal of the Savanna JV Partner as the “Managing Member” of the JV Entity upon the occurrence of a “Just Cause Event” (as such term is defined in the Limited Liability Company Agreement of the JV Entity) provided the KBS JV Partner then becomes the sole “Managing Member” of the JV Entity and KBS Sponsor has delivered a replacement Guaranty in compliance with the terms and provisions of Section 5.2.10(f) and the conditions detailed in Section 5.2.10(d)(i), (ii)((B) and (iii) through (viii) above remain satisfied. Notwithstanding any other provision herein to the contrary, with respect to KBS Sponsor, the sale, conveyance, transfer, disposition, alienation, hypothecation, pledge or encumbrance (whether voluntary or involuntary) of any shares of stock in KBS Sponsor (a “REIT Transfer”) shall be permitted without Agent’s prior written consent, provided that such REIT Transfer does not result in a change in Control of Borrower or the operations of the Property. Upon obtaining actual knowledge of a transfer of the shares in the KBS Sponsor that would result in any shareholder in KBS Sponsor owning more than ten percent (10%) of the indirect interests in Borrower, Borrower or KBS Sponsor shall promptly notify Agent in writing of such transfer and, to the extent in the possession or control of Borrower or KBS Sponsor, provide information sufficient to Agent to run searches relating to ERISA, OFAC and Patriot Act matters with respect to such shareholder. In addition, KBS SOR (BVI) Holdings, Ltd., KBS Strategic Opportunity Limited Partnership, KBS Strategic Opportunity REIT, Inc., and any of the other parties owning interests in KBS SOR (BVI) Holdings, Ltd., KBS Strategic Opportunity Limited Partnership shall be permitted to obtain loans from, or incur indebtedness from any third party lender (each a “Corporate Loan”) and pledge up to forty-nine percent (49%) in the aggregate of their respective interests (direct or indirect) in KBS SOR (BVI) Holdings, Ltd., KBS Strategic Opportunity Limited Partnership and KBS SOR Properties, LLC, as security for any such Corporate Loan so long as (i) if the ownership interests in Borrower, Mezzanine Borrower, JV Entity, KBS JV Partner and KBS SOR Acquisition XXV, LLC are not pledged to secure such sale or conveyance occurs prior Corporate Loan and (ii) such Corporate Loan is not specifically tied to the cash flow of the Property (as contrasted with, for example, the cash flow from a Securitizationgroup of properties); provided, Lender shall have consented however, as a condition precedent for such pledgee to realize on such pledge and take title to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect interests the conditions detailed in Section 5.2.10(d)(ii) through (viii) above remain satisfied.
(f) In connection with either (i) a Transfer pursuant to the Transfer, Sponsor owns not less than 51% terms and provisions of this Section 5.2.10 resulting in Guarantor no longer owning a direct or indirect interest in the equity interests Property or Borrower or (ii) a transfer pursuant to the terms and provisions of this Section 5.2.10 resulting in a change of Control following which Borrower and controlsshall be Controlled, directly or indirectly, by KBS Sponsor, Guarantor shall be released from the Guaranty and Environmental Indemnity with respect to actions or omissions first occurring or arising after the date of such transfer so long as Agent, for the benefit of Lenders, receives a replacement non-recourse carve-out guaranty in form and substance substantially similar to the Guaranty (including, without limitation, the net worth and liquidity covenants contained therein) and replacement environmental indemnity agreement in form and substance substantially similar to the Environmental Indemnity, each from a replacement Guarantor that satisfies the financial covenants of Section 5.2 of the Guaranty and that is otherwise reasonably acceptable to Borrower;, Agent and Lender. USActive 36631986.12 -114-
(iig) if as Agent and Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon a result Transfer prohibited hereunder without Agent’s consent. This provision shall apply to every Transfer prohibited hereunder regardless of whether voluntary or not, or whether or not Agent has consented to any previous Transfer.
(h) Upon request from Lender, Borrower shall promptly provide Lender a revised version of the organizational chart delivered to Lender in connection with the Loan reflecting any equity transfer consummated in accordance with Section 5.2.10(d) and Section 5.2.10(e). Notwithstanding anything to the contrary contained in this Agreement or in any other Loan Document, no Transfer of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower or either Mezzanine Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately permitted without Agent’s prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transferwritten consent, in its sole and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanabsolute discretion.
Appears in 1 contract
Sources: Building Loan Agreement (KBS Strategic Opportunity REIT, Inc.)
Transfers. (a) Borrower acknowledges that ▇▇▇▇▇▇ has examined and relied on the experience of Borrower and Operating Lessee and their stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower or default in the repayment of the Debt or the performance of the Other Obligations, ▇▇▇▇▇▇ can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.9(a), Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, (ii) enter into any PACE Loan or (iiiii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 and (DB) Permitted Transfers.
(bc) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a price to be paid in installments; (ii) an agreement by Borrower or Operating Lessee leasing all or a substantial part of the Property for other than actual occupancy by a space Tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s or Operating Lessee’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, Division, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger, Division, or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger, Divisions or consolidation or the change, removal, resignation or addition of a managing member or non‑member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non‑managing membership interests or the creation or issuance of new non‑managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; (vii) if the Property is not self-managed by ▇▇▇▇▇▇▇▇, the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof; or (viii) if any Restricted Party enters into a franchise agreement with respect to the Property.
(d) Notwithstanding the foregoingprovisions of Section 5.2.10(a), a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but ▇▇▇▇▇▇’s consent shall not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into be required in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfiedconnection with:
(i) one or a series of Transfers, of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no Event of Default such Transfer shall have occurred and be continuing and such sale or conveyance shall not result in an Event the change of Default;
(ii) the Person Control in a Restricted Party, and as a condition to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if each such sale or conveyance occurs prior to a SecuritizationTransfer, Lender shall have consented receive not less than thirty (30) days prior written notice of such proposed Transfer. If after giving effect to any such sale Transfer, more than forty-nine percent (49%) in the aggregate of direct or conveyanceindirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the Closing Date, which consent shall not be unreasonably withheld;
Borrower shall, no less than thirty (iv30) days prior to the effective date of any such Transfer, deliver to Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, and the Approved Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if. In addition, after giving effect to such Transfer, Sponsor does not Guarantor must continue to own at least 51% of the legal and beneficial interest in Borrower, Operating Lessee and Operating Lessee Pledgor. Lender shall have the right to perform searches and/or received other diligence such that Lender is in compliance with Lender’s then current “know your customer” requirements, and to the extent that any Transfer will result in the transferee (either itself or collectively with its affiliates) owning a 10% or greater equity interests interest (directly or indirectly) in Borrower and control Operating Lessee Lender’s receipt of the Satisfactory Search Results, at Borrower’s cost and expense, shall be a condition precedent to such Transfer;
(ii) one or a series of Transfers of the shares in a publicly traded entity which shares are listed on the New York Stock Exchange or another nationally recognized stock exchange;
(iii) one or a series of Transfers resulting from the exercise of remedies by any institutional lender under any upper-tier credit facility existing as of the date hereof so long as (x) there is no pledge of any direct interests in any Restricted Pledge Party, (y) such facility is indirectly secured by substantial real estate assets other than the Property, and (z) no Restricted Pledge Party shall issue preferred equity that has any of the characteristics of debt (such as a fixed maturity date, pledged ownership interests as security, regular payments of interest, a fixed rate of return or rights of the equity holder to demand repayment of its investment), and provided, that, (A) after giving effect to such Transfer Guarantor shall be under common Control with Borrower and own more than 50% of the indirect interests in Borrower, Operating Lessee and Operating Lessee, (B) none of Borrower, Operating Lessee and Operating Lessee Pledgor shall fail to be a Special Purpose Entity by reason of such Transfer, (C) Lender shall receive not less than thirty (30) days prior written notice of such proposed Transfer and Lender shall have the Rating Agencies have confirmed right to perform searches and/or received other diligence such that such sale or conveyanceLender is in compliance with Lender’s then current “know your customer” requirements, in and of itself, to the extent that any Transfer will not result in the transferee (either itself or collectively with its affiliates) owning a downgrade, qualification 10% or withdrawal greater equity interest (directly or indirectly) in Borrower and Operating Lessee Lender’s receipt of the then current ratings assigned Satisfactory Search Results, at Borrower’s cost and expense, shall be a condition precedent to the Securities; and
such Transfer, and (ixD) Borrower pays Lender’s reasonable costs and expenses if after giving effect to any such Transfer, more than forty-nine percent (including any fees due to the Rating Agencies49%) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation aggregate of a security interest in or other encumbrance) of any direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the Closing Date, Borrower is permitted provided that the following conditions are satisfied:
shall, no less than thirty (i30) if such sale or conveyance occurs days prior to a Securitization, Lender shall have consented to the effective date of any such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of deliver to Lender an Additional Insolvency Opinion acceptable to Lender and the equity interests in Borrower and controls, directly or indirectly, BorrowerApproved Rating Agencies;
(iiiv) if as a result of any such Transfer in one or a series of Transfers more than 49% related transactions of (1) the direct or indirect ownership interests in Borrower shall be transferred Guarantor, Soho Group, and/or any Restricted Party which Controls Guarantor and/or Soho Group or (2) all or substantially all of Soho Group’s assets and operations in the United States (an event described under such clauses (1) or (2), a “Soho US Transferred Assets”), in each case of (1) and (2), to a Qualified Equity Owner or a Person individually owned and Controlled by such Qualified Equity Owner provided that the Qualified Equity Owner Requirements shall have been satisfied as a condition to any such Transfer;
(v) a Transfer among Affiliates of Borrower so long as following such Transfer, (A) Guarantor continues to (x) own a legal, beneficial and economic interest in Borrower, Operating Lessee and Operating Lessee Pledgor directly or together with its Affiliates indirectly, (y) Control Borrower, Operating Lessee and Operating Lessee Pledgor and (z) maintain the Net Worth, Liquid Assets and Available Cash (each as defined in the Guaranty) requirements set forth in the Guaranty; (B) no such Transfer shall result in the change of Control in a Restricted Party, and (C) as a condition to each such Transfer, Lender shall receive not owning at least less than thirty (30) days prior written notice of such proposed Transfer. If after giving effect to any such Transfer, more than forty-nine percent (49% %) in the aggregate of the direct or indirect ownership interests in a Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the Closing Date, Borrower immediately shall, no less than thirty (30) days prior to the effective date of any such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Transfer, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by acceptable to Lender and the Approved Rating Agencies. Lender shall have the right to perform searches and/or received other diligence such that Lender is in compliance with Lender’s then current “know your customer” requirements, the Rating Agencies and their respective counsel, successors and assigns, with respect to the extent that any Transfer will result in the transferee (either itself or collectively with its affiliates) owning a 10% or greater equity interest (directly or indirectly) in Borrower and Operating Lessee Lender’s receipt of the Satisfactory Search Results, at Borrower’s cost and expense, shall be a condition precedent to such Transfer; or
(vi) one or a series of Transfers of the ownership interests in Soho House & Co Inc. or any successor entity permitted under the terms of this Agreement; provided, however, (x) as a condition to each such Transfer, Lender shall receive not less than seven (7) Business Days prior written notice of such proposed transfer Transfer, provided, that, for the avoidance of doubt, no notice shall be required in connection with one or salea series of Transfers of the shares in a publicly traded entity which shares are listed on the New York Stock Exchange or another nationally recognized stock exchange, which and (y) Soho House & Co. Inc. or any successor entity permitted under the terms of this Agreement shall continue to own 100% of the indirect interests in, and Control, Borrower, Operating Lessee and Guarantor. If after giving effect to any such Transfer, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person -92- and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the Closing Date, Borrower shall, no less than seven (7) Business Days prior to the effective date of any such Transfer, deliver to Lender an Additional Insolvency Opinion shall be reasonably acceptable to Lender andand the Approved Rating Agencies. Lender shall have the right to perform searches and/or received other diligence such that Lender is in compliance with ▇▇▇▇▇▇’s then current “know your customer” requirements, and to the extent that any Transfer will result in the transferee (either itself or collectively with its affiliates) owning a 10% or greater equity interest (directly or indirectly) in Borrower and Operating Lessee Lender’s receipt of the Satisfactory Search Results, at Borrower’s cost and expense, shall be a condition precedent to such Transfer.
(e) No Transfer of the Property and assumption of the Loan shall occur during the period that is sixty (60) days prior to and sixty (60) days after a Securitization. Otherwise, Lender shall consent to a one (1) time Transfer of the Rating Agencies;
Property or the legal or beneficial ownership interests therein or in Borrower, Operating Lessee and Operating Lessee Pledgor (iiiif such Transfer is not made in accordance with Section 5.2.10(d) at or Section 5.2.10(e) above) and an assumption of the time entire Loan which consent shall not be unreasonably withheld provided that Lender receives sixty (60) days prior written notice of such Transfer and no Event of Default has occurred and is continuing, and further provided that the following additional requirements are satisfied:
(i) Borrower shall pay Lender a transfer fee equal to (A) one-quarter of one percent (0.25%) of the outstanding principal balance of the Loan for the first assumption at the time of such transfer, and (B) one percent (1%) of the outstanding principal balance of the Loan for each subsequent assumption at the time of such transfer;
(ii) Borrower shall pay any and all reasonable out-of-pocket costs incurred in connection with such Transfer (including, without limitation, ▇▇▇▇▇▇’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Approved Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or Transferee’s Principals must have demonstrated expertise in owning and operating at lease five (5) similar properties to the Property (of which one property shall contain at least fifty (50) guest rooms and shall be located in Florida), which expertise shall be reasonably determined by ▇▇▇▇▇▇;
(iv) following such Transfer the property manager Transferee and Transferee’s Principals shall, as of the Property must be a Qualified Managerdate of such transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender;
(v) ifTransferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been the subject of any Bankruptcy Action within seven (7) years prior to the date of the proposed Transfer;
(vi) With respect to a Transfer of the Property, Transferee shall assume all of the obligations of Borrower and Operating Lessee under the Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or any Related Entities which, in each case, is not reasonably acceptable to Lender, Lender shall have performed searches and/or received other diligence such that Lender is in compliance with Lender’s then current “know your customer” requirements, and Lender shall have received Satisfactory Search Results for any owner of Transferee which will own a 10% or greater equity interest (directly or indirectly) in Borrower after giving effect to such Transfer;
(viii) Transferee, Sponsor does Transferee’s Principals and Related Entities shall not own at least 51% have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) With respect to any Transfer of the equity interests Property, Transferee must be able to satisfy all representations and covenants in Borrower Section 4.1.30 and control Borrowerin all cases Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, the Rating Agencies 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Default or Event of Default shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer otherwise occur as a result of which Sponsor will not own at least 51% of the equity interests in Borrower such Transfer, and control, directly or indirectly, Borrower, Borrower Transferee shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and deliver (A) all organizational documentation reasonably requested by ▇▇▇▇▇▇, which shall be reasonably satisfactory to Lender shall have consented and, following a Securitization, satisfactory to such Transfer the Approved Rating Agencies and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.all certificates, agreements, covenants and legal opinions reasonably required by ▇▇▇▇
Appears in 1 contract
Transfers. (a) Borrowers acknowledge that Lender has examined and relied on the experience of Borrowers and their direct and indirect members in owning and operating the Collateral and Mortgage Borrowers in agreeing to make the Loan, and will continue to rely on Borrowers’ ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Additionally, Borrowers acknowledge that Lender has examined and relied on the experience of Mortgage Borrowers and their general partners, members, principals and (if any Mortgage Borrower is a trust) beneficial owners, as applicable, in owning and operating properties such as the Properties and in owning intellectual property such as the IP, in agreeing to make the Loan, and will continue to rely on Mortgage Borrowers’ ownership of the Properties and the IP as a means of maintaining the value of the Properties and the IP and, therefore, indirectly the value of the Collateral, as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrowers acknowledge that Lender has a valid interest in maintaining the value of the Collateral so as to ensure that, should Borrowers default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Collateral.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower Borrowers shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyTransfer Restricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, license, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the any Property or any direct part thereof or indirect any legal or beneficial interest therein, or any IP or any part thereof or any legal or beneficial interest therein, or the Collateral or any part thereof or any legal or beneficial interest therein; or (ii) permit a Sale or Pledge of a direct or indirect any interest in Borrower or Operating Lessee, other than any Transfer Restricted Party (A) any of the Operating Lease, (B) pursuant to Leases of space actions in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
foregoing clauses (i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the ), a “TransfereeTransfer”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and), after a Securitizationother than, notwithstanding anything to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under contrary contained in this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied5.2.10:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners in owning the Collateral in agreeing to make the Loan, and will continue to rely on Borrower's ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Collateral so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Collateral.
(b) Without the prior written consent of Lender, Agent and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Collateral, any Individual Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party ((i) and (ii) collectively, a "TRANSFER"), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance5.1.20 hereof.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower or Mortgage Borrower, as applicable, agrees to sell the Collateral or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Mortgage Borrower leasing all or a substantial part of an Individual Property for other than actual occupancy by a resident or space tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Mortgage Borrower's right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation's stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager).
(d) Notwithstanding the provisions of this Section 5.2.10, the following transfers shall not be deemed to be a Transfer: (i) a sale or transfer of any direct or indirect interests interest in Borrower is permitted any shareholder of Guarantor, (ii) a sale or transfer of any direct or indirect interest in any Affiliate of Guarantor, provided such entity or entities are not a Pledgor or a Subsidiary of a Pledgor, (iii) a sale or transfer, pledge or encumbrance of all or substantially all of the stock or Guarantor, a merger or consolidation of Guarantor or a sale or transfer of all or substantially all of the assets of Guarantor, provided that the following conditions are satisfied:
(iA) if such sale or conveyance occurs prior to a Securitization, Lender Agent shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns receive not less than 51% thirty (30) days prior notice of such proposed merger, consolidation or acquisition, and (B) the successor entity in connection with any such merger or consolidation and the acquiring entity in connection with any such acquisition shall have a net worth that is equal to or greater than the greater of the equity interests net worth of Guarantor on the date hereof or the net worth of Guarantor immediately prior to such merger, consolidation or acquisition, (iv) the issuance, sale or transfer of stock of Guarantor in Borrower connection with an initial public offering of the stock of Guarantor, provided that (A) Agent shall receive not less than thirty (30) days prior notice of such proposed initial public offering, and controls(B) such stock will be listed on the New York Stock Exchange or such other nationally recognized stock immediately following such offering and such initial public offering is widely marketed to institutional investors exchange, and (v) the subsequent sale, transfer or issuance of stock in Guarantor, provided such stock is listed on the New York Stock Exchange or such other nationally recognized stock exchange. In addition, at all times, Heritage Partners must continue to own, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests a thirty three and one-third percent (33.33%) interest in Borrower, Mortgage Borrower immediately prior and Guarantor, provided, however, that in connection with an initial public offering permitted pursuant to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
subsection (v) ifabove, after giving effect Heritage Partners must continue to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and controlown, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen at least a twenty-five percent (1525%) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and Guarantor.
(Ae) Lender shall have not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon a Transfer without Lender's consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany previous Transfer.
Appears in 1 contract
Sources: Mezzanine Loan Agreement (Skilled Healthcare Group Inc)
Transfers. (a) Borrower acknowledges that each Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning collateral such as the Collateral in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that each Lender has a valid interest in maintaining the value of the Collateral so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, each Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of LenderAdministrative Agent, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property Property, the Mezzanine A Collateral, the Mezzanine B Collateral, the Collateral or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) enter into any PACE Loan, (iii) permit a Sale or Pledge of a direct or indirect an interest in Borrower any Restricted Party, (iv) permit a Sale or Operating Lessee, Pledge of the CPLV Lease or any interest therein or (v) permit a Sale or Pledge of any interest in CPLV Tenant or CPLV Tenant’s leasehold interest in the Property other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (B) Permitted Transfers (including Permitted Encumbrances), (C) pursuant to customary short-term occupancy agreements with the Room License AgreementsCPLV Tenant or short-term hotel guests, and or (D) Permitted Transfersa Transfer of a portion of the Property to a Governmental Authority in connection with a Condemnation of such portion of the Property in accordance with Section 6.3 hereof.
(bc) Notwithstanding A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the foregoingCollateral or any part thereof, Mezzanine B Borrower Mezzanine B Borrower agrees to sell the Mezzanine B Collateral or any part thereof, Mezzanine A Borrower Mezzanine A Borrower agrees to sell the Mezzanine A Collateral or any part thereof, or Mortgage Borrower agrees to sell the Property or any part thereof, in each case, for a sale price to be paid in installments; (ii) an agreement by Mortgage Borrower leasing all or conveyance by Borrower a substantial part of the Property subject for other than actual occupancy by a space Tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Mortgage Borrower’s right, title and interest in and to the lien of the Mortgage (but not CPLV Lease or any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
CPLV Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such sale corporation’s stock or conveyance occurs prior to the creation or issuance of new stock; (iv) if a SecuritizationRestricted Party is a limited or general partnership or joint venture, Lender shall have consented any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such sale partnership interest, or conveyancethe Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, which any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the Manager other than in accordance with Section 5.1.22 hereof.
(d) Notwithstanding the provisions of this Section 5.2.10(a), Administrative Agent’s consent shall not be unreasonably withheld;
required in connection with (i) one or a series of Transfers (except for a Pledge) of (x) not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party or (y) the indirect equity interests in Borrower by any Person that owns less than forty-nine percent (49%) of the economic and legal beneficial interests in, and does not Control, any of Mortgage Borrower, Mortgage Principal, Principal, any Mezzanine Borrower or Guarantor, (ii) any transfer of any direct or indirect legal or beneficial interests in the REIT, so long as it is a Public Vehicle, (iii) the cancellation, surrender, disposition, issuance, sale, grant, or Transfer of the operating partnership units of Guarantor, so long as the REIT continues to Control Guarantor and own directly or indirectly not less than 51% of the legal and beneficial interest in Guarantor, (iv) Lender has received an Additional Insolvency Opinion which the pledge of or grant of a security interest in the direct or indirect equity interests in Mortgage Borrower as security for the Loan or the other Mezzanine Loans, (v) the exercise by any Mezzanine Collateral Agent (on behalf of the applicable Mezzanine Lender) of any rights or remedies such Mezzanine Collateral Agent may be relied upon by Lender, have under the Rating Agencies and their respective successors and assigns, applicable Mezzanine Loan Documents with respect to the Transferee pledge and/or security interest referred to in the foregoing clause (iv), and its applicable affiliates(vi) the Mandatory Conversion; provided, which Additional Insolvency Opinion shall be reasonably acceptable however, that with respect to Lender or, after a Securitization, the Rating Agencies;
each such Transfer (other than under clause (v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
clause (vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
above), (viiA) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own (x) REIT shall continue to Control Mortgage Borrower, Borrower and Guarantor, (y) REIT shall continue to own, directly or indirectly, at least fifty-one percent (51% %) in the aggregate of the equity interests legal and beneficial interest in Mortgage Borrower, Mezzanine A Borrower, Mezzanine B Borrower and control Borrower and (z) Guarantor shall continue to own, directly or indirectly, at least fifty-one percent (51%) in the aggregate of the legal and beneficial interest in Mortgage Borrower, Mezzanine A Borrower, Mezzanine B Borrower and Borrower; (B) as a condition to each such Transfer, Administrative Agent shall receive not less than thirty (30) days prior written notice of such proposed Transfer (except with respect to any Transfer pursuant to clause (i) or clause (iii) to the Rating Agencies have confirmed extent that any such sale or conveyance, in and of itself, Transfer will not result in the transferee (either itself or collectively with its Affiliates) after giving effect to such Transfer owning a downgrade, qualification 10% or withdrawal greater equity interest (directly or indirectly) in Borrower (that did not own a 10% or greater interest therein as of the then current ratings assigned Closing Date), clause (ii) if the REIT is a Public Vehicle, clause (iv) or clause (v) above); (C) the representations set forth in Section 4.1.9 hereof shall continue to the Securities; and
(ix) Borrower pays Lender’s reasonable costs be true and expenses (including correct after giving effect to any fees due such Transfer and except with respect to the Rating Agencies) in connection with the sale or conveyance.
(c) A any Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interest in a Public Vehicle or pursuant to clause (v), transferee and its principals are not an Embargoed Person and the representations set forth in Section 4.1.35 hereof shall continue to be true and correct after giving effect to any such Transfer; (D) such Transfer shall be at Borrower’s sole cost and expense; (E) if after giving effect to any such Transfer, more than forty-nine percent (49%) in the aggregate of direct interests in Borrower is owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct interest in Borrower as of the Closing Date, Borrower shall, no less than ten (10) days prior to the effective date of any such Transfer, deliver to Administrative Agent an Additional Insolvency Opinion reasonably acceptable to Administrative Agent; (F) to the extent that any Transfer (other than any Transfer of shares in a Restricted Party that is a Public Vehicle and except with respect to any Transfer pursuant to clauses (iv) or (v)) will result in the transferee (either itself or collectively with its Affiliates) after giving effect to such Transfer owning a 10% or greater equity interest (directly or indirectly) in Borrower (that did not own a 10% or greater interest therein as of the Closing Date), Administrative Agent shall (x) have the right to perform any searches and/or reasonably request other diligence from Borrower to permit Administrative Agent and each Lender to comply with its then current “know your customer” requirements, including, but not limited to Patriot Act and OFAC searches and (y) receive Satisfactory Search Results, at Borrower’s cost and expense, as a condition precedent to such Transfer; (G) for so long as the Loan shall remain outstanding, no such Transfer or encumbrance of any direct interests in Mezzanine B Borrower shall be permitted provided (other than the pledges and security interests securing the Loan and any Transfer pursuant to clause (v)); (H) for so long as the Mezzanine A Loan shall remain outstanding, no such Transfer or encumbrance of any direct interests in Mortgage Borrower shall be permitted (other than the pledges and security interests securing the Mezzanine A Loan and any Transfer pursuant to clause (v)); (I) for so long as the Mezzanine B Loan shall remain outstanding, no such Transfer or encumbrance of any direct interests in Mezzanine A Borrower shall be permitted (other than the pledges and security interests securing the Mezzanine B Loan and any Transfer pursuant to clause (v)); (J) for so long as the Loan, the Mortgage Loan or any other Mezzanine Loan shall remain outstanding, neither Mortgage Borrower nor Mezzanine Borrower shall issue preferred equity interests (except as otherwise permitted pursuant to the Mortgage Loan Documents, Loan Documents, Mezzanine A Loan Documents, or Mezzanine B Loan Documents, as applicable); (K) all Transfers must be made in accordance with all Gaming Regulations, including receipt of any required Gaming Licenses; and (L) in no event may Borrower effect a Transfer, or permit or suffer any Transfer, that would result in a Gaming License Default.
(e) Without the following conditions are satisfiedprior written consent of Administrative Agent, Borrower shall not and shall not cause or permit Mortgage Borrower to permit any Transfer (including any Sale or Pledge) of any interest in CPLV Tenant or any interest of CPLV Tenant in the CPLV Lease, except that Administrative Agent’s consent shall not be required, in connection with:
(i) one or a series of Transfers of the direct or indirect legal or beneficial interests in CEC, including any acquisition, merger, amalgamation or consolidation of CEC, shall be permitted, so long as (1) either (x) CEC, an entity that acquires a controlling interest in CEC or, in the case of a merger, consolidation or amalgamation of CEC where CEC is not the surviving entity, the surviving entity (the entity that acquires a controlling interest in CEC or that survives a merger, amalgamation or consolidation with CEC (if such sale CEC is not the survivor), a “Replacement CEC Sponsor”) remains a Public Vehicle or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, (y) immediately after giving effect to the such Transfer, CEC or the Replacement CEC Sponsor owns satisfies the requirements of a Qualified CPLV Replacement Guarantor and (2) in the case where after such Transfer, CEC is not a Public Vehicle, the surviving Public Vehicle or entity that qualifies as a Qualified CPLV Replacement Guarantor pursuant to clause (1)(x) or (1)(y) above, as applicable, delivers a reaffirmation of the CPLV Lease Guaranty, in form and substance reasonably acceptable to Administrative Agent contemporaneous with such Transfer or, if requested by Administrative Agent, a replacement guaranty substantially similar to the CPLV Lease Guaranty or in such other form and substance as reasonably acceptable to Administrative Agent;
(ii) one or more encumbrances of CPLV Tenant’s leasehold interest in the Property pursuant to one or more mortgages and/or pledges of the direct or indirect equity interests in CPLV Tenant, to secure indebtedness of CPLV Tenant and/or its direct or indirect parent entities or Affiliates (each, a “CPLV Tenant Loan”), so long as (x) each such mortgage or pledge agreement shall provide that any security interest granted under such mortgage or pledge agreement with respect to Tenant’s Pledged Property (as defined in the CPLV Lease) shall be subordinate to the lien granted in favor of Mortgage Borrower and otherwise be in accordance with the terms and conditions hereunder and the CPLV Lease SNDA and the CPLV Tenant Loan Intercreditor Agreement and (y) the lender of any CPLV Tenant Loan that encumbers Tenant’s Pledged Property (a “CPLV Tenant Lender”) shall enter into an intercreditor agreement with Mortgage Lender (or join an existing intercreditor agreement with Mortgage Lender), in form and substance reasonably acceptable to Mortgage Lender (a “CPLV Tenant Loan Intercreditor Agreement”) as a condition precedent to such CPLV Tenant Loan;
(iii) one or a series of Transfers (except for a Pledge), of not more than forty-nine percent (49%) of the direct or indirect stock, partnership interests or membership interests (as the case may be) in CPLV Tenant;
(iv) a Transfer of 100% of the direct or indirect legal and beneficial interests in CPLV Tenant and/or the leasehold interest of CPLV Tenant in the Property (subject to exclusion with respect to items that are not capable of being mortgaged and that, in the aggregate, are de minimis) pursuant to or at any time after a foreclosure (or conveyance in lieu thereof or pursuant to any other exercise of remedies) of the CPLV Tenant Loan by CPLV Tenant Lender, subject to satisfaction of the following conditions:
(A) either of the following conditions shall be satisfied (the “CPLV Tenant Transferee Requirement”):
(1) (x) the proposed transferee that assumes all of the obligations, liabilities and rights of CPLV Tenant under the CPLV Lease and CPLV Lease Documents (the “CPLV Tenant Transferee”) shall be a Qualified CPLV Tenant Transferee or a Qualified CPLV Tenant Transferee shall Control and own not less than 51% of the equity economic and beneficial interests in Borrower CPLV Tenant or such CPLV Tenant Transferee after such Transfer, (y) a replacement lease guarantor that is a Qualified CPLV Replacement Guarantor shall execute a replacement guaranty substantially similar to the CPLV Lease Guaranty or in such other form and controls, directly or indirectly, Borrower;substance as acceptable to Administrative Agent and (z) the Property is managed by a Qualified Replacement Manager; or
(ii2) if as (x) a result transferee that satisfies the requirements in (b) through (g) in the definition of any such Transfer “Qualified CPLV Tenant Transferee” shall be, or series of Transfers more Control and own not less than 4951% of the direct or indirect ownership economic and beneficial interests in CPLV Tenant or CPLV Tenant Transferee after such Transfer, (y) the CPLV Lease is guaranteed by CEC (or following any Transfer under Section 5.2.10(e)(i) above, the Replacement CEC Sponsor) and (z) the Property is managed by the Manager under the Management Agreement (or a Qualified Replacement Manager under a Replacement Management Agreement in the event Mortgage Borrower shall be transferred to a Person individually or together terminated Manager in accordance with its Affiliates not owning at least 49% Section 16.5 of the direct or indirect ownership interests Management Agreement and the terms hereunder (unless Administrative Agent has consented in Borrower immediately prior its sole and absolute discretion to the permanent termination of the Management Agreement)); and
(B) such Transfer (shall not diminish any of the rights of Mortgage Borrower or as reflected Mortgage Lender under, or other result in any change to the transition services for the benefit of Mortgage Borrower and Mortgage Lender, set forth in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, Transition Services Agreement or under the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified ManagerMortgage Loan Documents;
(v) if, after giving effect prior to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as pursuant to clause (iv) above, a result Transfer of which Sponsor will not own at least 51% all right, title and interest of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.CPLV Te
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment 72 of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or any interest of Borrower in the Loan or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer shall include (but not i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non managing membership interests or the creation or issuance of new non managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions are satisfied:creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(id) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverNotwithstanding the provisions of this Section 5.2.10, Lender’s consent shall not be required ifin connection with one or a series of Transfers, of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such Transfer shall result in the change of Control in a Restricted Party, and as a condition to each such Transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed Transfer. If after giving effect to the any such Transfer, Sponsor owns not more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than 51% forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the equity interests Closing Date, Borrower shall, no less than thirty (30) days prior to the effective date of any such Transfer, deliver to Lender an 73 Additional Insolvency Opinion acceptable to Lender and the Rating Agencies. Borrower shall pay any and all reasonable out-of-pocket costs and expenses incurred in connection with such Transfers (including Lender’s counsel fees and disbursements and any fees and expenses of the Rating Agencies).
(e) No Transfer of the Property and assumption of the Loan shall occur during the period that is sixty (60) days prior to and sixty (60) days after a Securitization. Without limiting Lender’s discretion to approve or disapprove any request for a waiver of the prohibition against Transfers, Lender specifically reserves the right to condition its consent to any waiver of a prohibited Transfer upon satisfaction of the following minimum conditions:
(i) Borrower and controls, directly or indirectly, Borrowershall pay Lender a transfer fee equal to one percent (1%) of the outstanding principal balance of the Loan at the time of such transfer;
(ii) if Borrower shall pay any and all reasonable out-of-pocket costs incurred in connection with such Transfer (including Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or Transferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Property, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Default or Event of Default shall otherwise occur as a result of any such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements, covenants and legal opinions reasonably required by Lender;
(x) If required by Lender, Transferee shall be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a requalification, reduction, downgrade or series of Transfers more than 49% withdrawal of the direct or indirect ownership interests ratings in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower effect immediately prior to such Transfer assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Prior to any release of Guarantor, one (1) or more substitute guarantors acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or execute a replacement guaranty and environmental indemnity reasonably satisfactory to Lender.
(xii) Borrower shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policy, as reflected modified by the assumption agreement, as a valid first lien on the Property and naming the Transferee as owner of the Property, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Property shall not be subject to any additional exceptions or liens other than those contained in the most recent Additional Insolvency Opinion delivered Title Policy issued on the date hereof and the Permitted Encumbrances;
(xiii) The Property shall be managed by Qualified Manager pursuant to a Replacement Management Agreement;
(xiv) The Property meets all of the Lender)’s underwriting standards related to its financial condition, cash flow, operating income, physical condition, management and operation; and
(xv) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion which reflecting such Transfer satisfactory in form and substance to Lender.
(f) Notwithstanding any provision in this Section 5.2.10 to the contrary, limited partnership or membership interests, as applicable, in Borrower may be relied upon by transferred without Lender’s consent and without application of the fee set forth in Section 5.2.10(e)(i): (i) among limited partners or members, as applicable, of Borrower who are limited partners or members, as applicable, of Borrower as of the Rating Agencies date of this Agreement (each a “Current Owner”), and their respective counsel, successors and assigns, with respect (ii) to the proposed transfer or sale, immediate family members (which Additional Insolvency Opinion shall be reasonably acceptable limited to Lender anda spouse, after a Securitizationparent, child and grandchild (each, an “Immediate Family Member”)), of any Current Owner or to trusts formed for the Rating Agencies;
(iii) at the time benefit of Immediate Family Members of such Transfer Current Owner for bona fide estate planning purposes (each, an “Additional Permitted Transfer”), provided each of the following conditions is satisfied: (A) no Event of Default has occurred and no event has occurred that with notice or the passage of time, or both, would constitute an Event of Default; (B) Lender has received Borrower’s notice of the Additional Permitted Transfer no less than 30 days prior to the commencement of such transfer; (C) no Indemnitor or Guarantor shall be released from any guaranty or indemnity agreement by virtue of the Additional Permitted Transfer; (D) Borrower shall be responsible for the costs and expenses of documenting the Additional Permitted Transfer; (E) Borrower shall reimburse Lender for all actual costs and expenses incurred by Lender in connection with the Additional Permitted Transfer, whether or not consummated; (F) once the Additional Permitted Transfer is continuing;
(iv) following such Transfer complete, the property manager persons with Control of Borrower and management of the Property must be a Qualified Manager;are the same persons who have such Control and management rights immediately prior to the Additional Permitted Transfer; (G) Borrower shall furnish Lender copies of any documentation executed in connection with the Additional Permitted Transfer promptly after execution thereof; and (H) Borrower shall have delivered satisfactory evidence to Lender that, following the Additional Permitted Transfer, Borrower shall continue to comply with the provisions of Section 4.1.30 hereof; and (I) upon Lender’s request, delivery of an Additional Insolvency Opinion acceptable to Lender.
(vg) ifWithout Lender’s prior written consent thereto, after giving effect to such Transferin its sole discretion, Sponsor does not own at least 51% of the equity any Transfer or Permitted Transfer resulting in any direct or indirect ownership interests in Borrower and control Borroweror the Property being held in any Prohibited Entity/Ownership Structure is prohibited, even if the same would be otherwise allowed pursuant to this Section 5.2.10, the Rating Agencies shall have confirmed that definition of a Permitted Transfer or any other provision of any Loan Document.
(h) So long as any conditions set forth below are satisfied, each of the following Transfers may occur at any time and from time-to-time without Lender’s consent:
(i) Any Transfer of direct or indirect interests in the REIT so long as such Transfer, in and of itself, will Transfer does not result in a downgrade, qualification or withdrawal change of the then current ratings assigned Control with respect to the SecuritiesREIT, Guarantor or the Borrower; or
(viii) The removal or replacement of any investment advisor to the REIT so long as such removal or replacement does not result in a change of Control with respect to the REIT, Guarantor or the Borrower. Borrower shall pay, or cause to be paid, provide to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests described in Borrower and controlitems (i) or (ii) above, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice evidence reasonably satisfactory to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and following: (A) Lender shall have consented to the current direct and indirect ownership of Borrower (including as evidenced by an updated organizational chart providing the same general level of detail as the organizational chart attached hereto as Schedule III), together with copies of all instruments effecting any such Transfer Transfer, and (B) Borrower shall pay evidence reasonably satisfactory to Lender a loan assumption fee of Borrower’s continued compliance with Sections 4.1.30, 4.1.35, 5.1.23, 5.2.9 and 10.25 hereof. In addition, if after giving effect to any such Transfer, (1% ) more than forty-nine percent (49%) of the then outstanding principal amount direct or indirect interests in Borrower are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) of the Loandirect or indirect interest in Borrower as of the Closing Date, Borrower shall, no less than ten (10) days prior to the effective date of any such Transfer, deliver to Lender an Additional Insolvency Opinion acceptable to Lender, and (2) twenty percent (20%) or more of the direct or indirect interests in Borrower are owned by any Person and its Affiliates that owned less than twenty percent (20%) of the direct or indirect interest in Borrower 76 as of the Closing Date, Borrower shall, no less than ten (10) days prior to the effective date of any such Transfer, deliver to Lender customary searches (including without limitation credit, judgment, lien, litigation, bankruptcy, criminal and watch list) reasonably acceptable to Lender with respect to such Person and its Affiliates. Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer.
Appears in 1 contract
Sources: Loan Agreement (Carter Validus Mission Critical REIT II, Inc.)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and leasing properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) enter into any PACE Loan, (iii) permit a Sale or Pledge of a direct or indirect an interest in Borrower any Restricted Party, (iv) permit a Sale or Operating Lessee, Pledge of the CPLV Lease or any interest therein or (v) permit a Sale or Pledge of any interest in CPLV Tenant or CPLV Tenant’s leasehold interest in the Property other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (B) Permitted Transfers (including Permitted Encumbrances), (C) pursuant to customary short-term occupancy agreements with the Room License AgreementsCPLV Tenant or short-term hotel guests, and or (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower Transfer of a portion of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to Governmental Authority in connection with a Condemnation of such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager portion of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection accordance with the sale or conveyanceSection 6.3 hereof.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to the CPLV Lease or other encumbranceany CPLV Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions are satisfied:creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the Manager other than in accordance with Section 5.1.22 hereof. -109-
(id) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverNotwithstanding the provisions of this Section 5.2.10(a), Lender’s consent shall not be required ifin connection with (i) one or a series of Transfers (except for a Pledge), after giving effect of (x) not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party or (y) the indirect equity interests in Mezzanine C Borrower by any Person that owns less than forty-nine percent (49%) of the economic and legal beneficial interests in, and does not Control, any of Borrower, Principal, any Mezzanine Borrower or Guarantor, (ii) any transfer of any direct or indirect legal or beneficial interests in the REIT, so long as it is a Public Vehicle, (iii) the cancellation, surrender, disposition, issuance, sale, grant, or Transfer of the operating partnership units of Guarantor, so long as the REIT continues to the Transfer, Sponsor owns Control Guarantor and own directly or indirectly not less than 51% of the legal and beneficial interest in Guarantor, (iv) the pledge of or grant of a security interest the direct or indirect equity interests in Borrower as security for the Mezzanine Loan, (v) the exercise by any Mezzanine Lender of any rights or remedies such Mezzanine Lender may have under the applicable Mezzanine Loan Documents with respect to the pledge and/or security interest referred to in the foregoing clause (iv), and controls(vi) the Mezzanine C Equity Conversion; provided, however, that with respect to each such Transfer (other than under clause (v) or clause (vi) above), (A) after giving effect to such Transfer, (x) REIT shall continue to Control Borrower and Guarantor, (y) REIT shall continue to own, directly or indirectly, at least fifty-one percent (51%) in the aggregate of the legal and beneficial interest in Borrower and (z) Guarantor shall continue to own, directly or indirectly, at least fifty-one percent (51%) in the aggregate of the legal and beneficial interest in Borrower;
, (B) as a condition to each such Transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed Transfer (except with respect to any Transfer pursuant to clause (i) or clause (iii) to the extent that any such Transfer will not result in the transferee (either itself or collectively with its Affiliates) after giving effect to such Transfer owning a 10% or greater equity interest (directly or indirectly) in Borrower (that did not own a 10% or greater interest therein as of the Closing Date), clause (ii) if the REIT is a Public Vehicle, clause (iv) or clause (v) above), (C) the representations set forth in Section 4.1.9 and hereof shall continue to be true and correct after giving effect to any such Transfer and except with respect to any Transfer of a direct or indirect interest in a Public Vehicle or pursuant to clause (v), transferee and its principals are not an Embargoed Person and the representations set forth in Section 4.1.35 hereof shall continue to be true and correct after giving effect to any such Transfer; (D) such Transfer shall be at Borrower’s sole cost and expense; (E) if after giving effect to any such Transfer, more than forty-nine percent (49%) in the aggregate of direct interests in Borrower is owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct interest in Borrower as a result of the Closing Date, Borrower shall, no less than ten (10) days prior to the effective date of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Transfer, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, and after a Securitization, the Approved Rating Agencies;
; (iiiF) at to the time extent that any Transfer (other than any Transfer of such shares in a Restricted Party that is a Public Vehicle and except with respect to any Transfer no Event of Default has occurred and is continuing;
pursuant to clauses (iv) following or (v)) will result in the transferee (either itself or collectively with its Affiliates) after giving effect to such Transfer the property manager owning a 10% or greater equity interest (directly or indirectly) in Borrower (that did not own a 10% or greater interest therein as of the Property Closing Date), Lender shall (x) have the right to perform any searches and/or reasonably request other diligence from Borrower to permit Lender to comply with its then current “know your customer” requirements, including, but not limited to Patriot Act and OFAC searches and (y) receive Satisfactory Search Results, at Borrower’s cost and expense, as a condition precedent to such Transfer, (G) for so long as the Mezzanine A Loan shall remain outstanding, no such Transfer or encumbrance of any direct interests in Borrower shall be permitted (other than the pledges and security interests securing the Mezzanine A Loan and any Transfer pursuant to clause (v)); (H) for so long as the Mezzanine B Loan shall remain outstanding, no such Transfer or encumbrance of any direct interests in Mezzanine A Borrower shall be permitted (other than the pledges and security interests securing the Mezzanine B Loan and any Transfer pursuant to clause (v)), (I) for so long as the Mezzanine C Loan shall remain outstanding, no such Transfer or encumbrance of any direct interests in Mezzanine C Borrower shall be permitted (other than the pledges and security interests securing the Mezzanine C Loan and any Transfer pursuant to clause (v)), (J) for so long as the Loan or any Mezzanine Loan shall remain outstanding, neither Borrower nor Mezzanine Borrower shall issue preferred equity interests (except as otherwise permitted pursuant to the Loan Documents, Mezzanine A Loan Documents, Mezzanine B Loan Documents or Mezzanine C Loan Documents, as applicable), (K) all Transfers must be made in accordance with all Gaming Regulations, including receipt of any required Gaming Licenses and (L) in no event may Borrower effect a Qualified Manager;Transfer, or permit or suffer any Transfer, that would result in a Gaming License Default.
(ve) ifWithout the prior written consent of Lender, Borrower shall not permit any Transfer (including any Sale or Pledge) of any interest in CPLV Tenant or any interest of CPLV Tenant in the CPLV Lease, except that Lender’s consent shall not be required in connection with:
(i) one or a series of Transfers of the direct or indirect legal or beneficial interests in CEC, including any acquisition, merger, amalgamation or consolidation of CEC, shall be permitted, so long as (1) either (x) CEC, an entity that acquires controlling interest in CEC or, in the case of a merger, consolidation or amalgamation of CEC where CEC is not the surviving entity, the surviving entity (the entity that acquires a controlling interest in CEC or that survives a merger, amalgamation or consolidations with CEC (if CEC is not the survivor), a “Replacement CEC Sponsor”) remains a Public Vehicle or (y) immediately after giving effect to such Transfer, CEC or the Replacement CEC Sponsor does satisfies the requirements of a Qualified CPLV Replacement Guarantor and (2) in the case where after such Transfer, CEC is not a Public Vehicle, the surviving Public Vehicle or entity that qualifies as a Qualified CPLV Replacement Guarantor pursuant to clause (1)(x) or (1)(y) above, as applicable, delivers a reaffirmation of the CPLV Lease Guaranty, in form and substance reasonably acceptable to Lender contemporaneous with such Transfer or, if requested by Lender, a replacement guaranty substantially similar to the CPLV Lease Guaranty or in such other form and substance as reasonably acceptable to Lender;
(ii) one or more encumbrances of CPLV Tenant’s leasehold interest in the Property pursuant to one or more mortgages and/or pledges of the direct or indirect equity interests in CPLV Tenant, to secure indebtedness of CPLV Tenant and/or its direct or indirect parent entities or Affiliates (each, a “CPLV Tenant Loan”), so long as (x) each such mortgage or pledge agreement shall provide that any security interest granted under such mortgage or pledge agreement with respect to Tenant’s Pledged Property (as defined in the CPLV Lease) shall be subordinate to the lien granted in favor of Borrower and otherwise be in accordance with the terms and conditions hereunder and the CPLV Lease SNDA and the CPLV Tenant Loan Intercreditor Agreement and (y) the lender of any CPLV Tenant Loan that encumbers Tenant’s Pledged Property (a “CPLV Tenant Lender”) shall enter into an intercreditor agreement with Lender in the form of the CPLV Existing Intercreditor Agreement (or join the CPLV Existing Intercreditor Agreement), in form and substance reasonably acceptable to Lender (a “CPLV Tenant Loan Intercreditor Agreement”) as a condition precedent to such CPLV Tenant Loan;
(iii) one or a series of Transfers (except for a Pledge), of not more than forty-nine percent (49%) of the direct or indirect stock, partnership interests or membership interests (as the case may be) in CPLV Tenant;
(iv) a Transfer of 100% of the direct or indirect legal and beneficial interests in CPLV Tenant and/or the leasehold interest of CPLV Tenant in the Property (subject to exclusion with respect to items that are not capable of being mortgaged and that, in the aggregate, are de minimis) pursuant to or at any time after a foreclosure (or conveyance in lieu thereof or pursuant to any other exercise of remedies) of the CPLV Tenant Loan by CPLV Tenant Lender, subject to satisfaction of the following conditions:
(A) either of the following conditions shall be satisfied (the “CPLV Tenant Transferee Requirement”):
(1) (x) the proposed transferee that assumes all of the obligations, liabilities and rights of CPLV Tenant under the CPLV Lease, CPLV Lease Documents and CPLV Trademark Agreements (the “CPLV Tenant Transferee”) shall be a Qualified CPLV Tenant Transferee or a Qualified CPLV Tenant Transferee shall Control and own at least not less than 51% of the equity economic and beneficial interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that CPLV Tenant or such CPLV Tenant Transferee after such Transfer, (y) a replacement lease guarantor that is a Qualified CPLV Replacement Guarantor shall execute a replacement guaranty substantially similar to the CPLV Lease Guaranty or in such other form and substance as acceptable to Lender and (z) the Property is managed by a Qualified Replacement Manager; or
(2) (x) a transferee that satisfies the requirements in (b) through (g) in the definition of itself“Qualified CPLV Tenant Transferee shall be, will or Control and own not less than 51% of the economic and beneficial interests in CPLV Tenant or CPLV Tenant Transferee after such Transfer, (y) the CPLV Lease is guaranteed by CEC (or following any Transfer under Section 5.2.10(e)(i) above, the Replacement CEC Sponsor) and (z) the Property is managed by the Manager under the Management Agreement (or a Qualified Replacement Manager under a Replacement Management Agreement in the event Borrower terminated Manager in accordance with Section 16.5 of the Management Agreement and the terms hereunder (unless Lender has consented in its sole and absolute discretion to the permanent termination of the Management Agreement))]; and
(B) such Transfer shall not diminish any of the rights of Borrower or Lender under, or other result in any change to the transition services for the benefit of Borrower and Lender, set forth in the Transition Services Agreement or under the Loan Documents;
(v) prior to any Transfer pursuant to clause (iv) above, a downgradeTransfer of all right, qualification or withdrawal title and interest of CPLV Tenant in the CPLV Lease to an Affiliate of CPLV Tenant that is owned and Controlled by CEC (the “Affiliate Tenant Transferee”), so long as a condition precedent to such Transfer, (A) there is no Uncured CPLV Lease Event of Default, (B) Affiliate Tenant Transferee shall assume all of the then current ratings assigned obligations of CPLV Tenant under the CPLV Lease SNDA, the CPLV Security Documents and all other Loan Documents to the Securities
(vi) Borrower shall paywhich CPLV Tenant is a party, or cause to be paid, in a manner reasonably satisfactory to Lender its reasonable out-of-pocket expenses (including in all material respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender and Affiliate Tenant Transferee shall execute and deliver to Lender, any fees due modifications or amendments to the Rating Agencies) such Loan Documents reasonably required by Lender in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay take all such actions to Lender a loan assumption fee of 1% of continue the then outstanding principal amount of the Loan.perfected security interest
Appears in 1 contract
Sources: Loan Agreement
Transfers. (ai) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating the Home and the Home Leases in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Homes and Home Leases as a means of maintaining the value of the Homes and Home Leases as security for repayment of the Debt and the performance of the other obligations of Borrower hereunder. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Homes and Home Leases so as to ensure that, should Borrower default in the repayment of the Debt, Lender can recover the Debt by a sale of the Homes and the transfer of the Home Leases.
(ii) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 2.05 or with respect to the leasing of the Homes in the ordinary course of business in accordance with the terms hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): (iA) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property Homes, the Leases or any direct part thereof or indirect any legal or beneficial interest therein, therein or (iiB) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Borrower Party, other than (A) the Operating Lease, (B) pursuant to Home Leases of space in the Improvements to tenants Residents in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers5.01(r).
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) A Transfer shall include, but not be limited to, (A) an installment sales agreement wherein Borrower agrees to sell the Homes or any part thereof for a price to be paid in installments; (B) an agreement by Borrower leasing all or a substantial part of any Home for other than actual occupancy by a Resident thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents allocated to the Homes; (C) if a Borrower Party is a corporation, any merger, consolidation or Sale or Pledge of such sale corporation’s stock or conveyance occurs prior to the creation or issuance of new stock; (D) if a SecuritizationBorrower Party is a limited or general partnership or joint venture, Lender shall have consented any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such sale partnership interest, or conveyancethe Sale or Pledge of any limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (E) if a Borrower Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the direct or indirect membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of any direct or indirect non-managing membership interests or the creation or issuance of new non-managing membership interests; or (F) if a Borrower Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower or the creation or issuance of new legal or beneficial interests.
(iv) For the avoidance of doubt, without the prior written consent of Lender which consent shall not be unreasonably withheld;
: (ivAA) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion ▇▇▇▇▇▇▇ ▇▇▇ shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as not transfer or dilute any of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security his ownership interest in or other encumbranceGVEST Real Estate Capital LLC, a Delaware limited liability company (“GV REC LLC”); (BB) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent GV REC LLC shall not be unreasonably withheldtransfer or dilute any of its interest in the Borrower’s Member; provided however, Lender(CC) Borrower’s consent Member shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or saledilute its membership interest in Borrower; (DD) Manufactured Housing Properties, which Additional Insolvency Opinion Inc. shall be reasonably acceptable to Lender andnot transfer or dilute its membership interest in any Community Owner; and (EE) ▇▇▇▇▇▇▇ ▇▇▇ shall not transfer or allow for the dilution of his ownership interest in Manufactured Housing Properties, after a SecuritizationInc. so that his ownership interest falls below 65%. Notwithstanding the foregoing, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and only notice is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause required to be given written notice to Lender within ten (10) days following the consummation of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name following together with copies of the Person documents evidencing the Transfer: (AA) for estate planning purposes, ▇▇▇▇▇▇▇ ▇▇▇ establishes a revocable trust in which he is the sole grantor and primary beneficiary; and (BB) ▇▇▇▇▇▇▇ ▇▇▇ seeks to which the transfer not more than twenty-two percent of his common equity interest in Borrower is to be transferredManufactured Housing Properties, identify Inc. provided that he remains the proposed transferee and set forth the date the Transfer is expected to be effective and owner of sixty-five (A65%) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.common equity interest and voting and economic interest in Manufactured Housing Properties, Inc.
Appears in 1 contract
Sources: Loan Agreement (Manufactured Housing Properties Inc.)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members and (if Borrower is a trust) beneficial owners, as applicable, in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property Property, the Collateral or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower the Property, the Collateral or Operating Lesseein any Restricted Party (separately and collectively, a “Transfer”), other than (A) the Operating Lease, (Bx) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.205.1.20 hereof, (Cy) the Room License Agreements, disposition of Equipment and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the other Personal Property subject pursuant to the lien of the Mortgage (but not any other mortgage, lien replacement thereof or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into otherwise in the ordinary course of operating the Propertyoperation of the Property and (z) the approved sale of Units in accordance with the terms and provisions of Section 2.8 hereof. Notwithstanding anything to the contrary contained herein or in the other Loan Documents, Transfers of interests in the Whitehall Guarantor or in any Person having any direct or indirect legal or beneficial interest in the Whitehall Guarantor shall not be prohibited or restricted in any manner whatsoever, including by sale, merger, consolidation or otherwise.
(c) Subject to the last sentence of Section 5.2.10(b), a Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or the Collateral, or any part thereof, for a price to be paid in installments; (ii) an agreement by Borrower leasing all or substantially all of the Property for other than actual occupancy by a space tenant thereunder, or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is permitted a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests. Notwithstanding anything to the contrary contained in this Section 5.2.10(c), Whitehall Guarantor and/or its Affiliates may purchase the membership interests of Park Central Realty Associates LLC in W2001 Park Central Hotel Realty, L.L.C. without violating the provisions of this Section 5.2.10(c) and without Lender’s consent.
(d) Notwithstanding the provisions of this Section 5.2.10, the following transfers shall not be deemed to be a Transfer: (i) the sale or transfer, in one or a series of transactions, of not more than forty-nine percent (49%) of the stock in a Restricted Party; provided, however, no such sales or transfers shall result in the change of voting control in the Restricted Party, and as a condition to each such sale or transfer, Lender shall receive not less than thirty (30) days prior notice of such proposed sale or transfer, and (ii) the sale or transfer, in one or a series of transactions, of not more than forty-nine percent (49%) of the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such sales or transfers shall result in the change of voting control in the Restricted Party, and as a condition to each such sale or transfer, Lender shall receive not less than thirty (30) days prior notice of such proposed sale or transfer. In addition, at all times, the Whitehall Guarantor must continue to control Borrower and own, directly or indirectly, at least a fifty-one percent (51%) interest in Borrower.
(e) Lender shall not withhold its consent to a transfer of the Property to a Permitted Transferee (including, without limitation, an Affiliate of Borrower that is a Permitted Transferee) provided that the following conditions are satisfied:
(i) no Event of Default or Mortgage Loan Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
remain uncured; (ii) the Person Permitted Transferee shall have executed and delivered to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of Lender a Special Purpose Entity and the organizational documents modification of the Transferee are reasonably terms of the Mortgage Loan Agreement, the Mortgage Note, the Mortgage or the other Mortgage Loan Documents in form and substance acceptable to Lender and, after a Securitization, to the Rating Agencies;
Lender; (iii) if such sale or conveyance occurs prior to a Securitization, Lender the Permitted Transferee shall have consented executed and delivered to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Mortgage Lender has received an Additional Insolvency Opinion which may be relied upon by Lenderassumption of the Mortgage Loan Agreement, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this AgreementMortgage Note, the Mortgage and the other Mortgage Loan Documents as so modified by the Permitted Transferee in form and substance acceptable to Lender, evidencing such Permitted Transferee’s agreement to abide and be bound by the terms of the Mortgage Note, the Mortgage Loan Agreement and the other Mortgage Loan Documents, subject, however, subject to the provisions of Section 9.3 hereof 10.4 hereof; (iv) the principals of the Permitted Transferee shall have executed and upon delivered to Lender a modification of the terms of this Agreement, the Note, the Pledge Agreement or the other Loan Documents in form and substance acceptable to Lender; (v) the principals of the Permitted Transferee shall have executed and delivered to Lender an assumption of this Agreement, the Note, the Pledge Agreement and the other Loan Documents in form and substance acceptable to Lender, evidencing such assumptionPerson’s agreement to abide and be bound by the terms of the Note, Borrower shall be released from all liabilities this Agreement, the Pledge and obligations under the other Loan Documents;
, subject to the provision of Section 10.4 hereof; (vi) following such sale or conveyance the property manager Lender shall have received payment of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee all of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs fees and expenses (including any fees due to the Rating Agencies) incurred in connection with the sale or conveyance.
(c) A Transfer (but not a pledgesuch transfer including, hypothecationwithout limitation, creation all of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with the approval of such sale transfer, the cost of any third party reports, legal fees and expenses, Rating Agency fees and expenses or conveyancerequired legal opinions; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented received payment of a non-refundable $5,000 application fee and, in the event the Permitted Transferee is not an Affiliate of Borrower, Mortgage Lender shall have received payment of an assumption fee equal to such Transfer and one half of one percent (B0.5%) Borrower of the Aggregate Outstanding Principal Balance; (viii) the Permitted Transferee shall pay have delivered to Lender a loan assumption fee of 1% nonconsolidation opinion reflecting the proposed transfer satisfactory in form and substance to Lender; (ix) Lender shall have received satisfactory evidence of the then outstanding principal amount principals of the Loan.Permitted Transferee’s continued compliance with the
Appears in 1 contract
Sources: First Mezzanine Loan Agreement (KBS Real Estate Investment Trust, Inc.)
Transfers. (a) Without Unless such action is permitted by the prior written consent provisions of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.13, Borrower shall not, and shall agrees that it will not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): (i) sell, assign, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, transfer or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) its interests in the Property or any direct or indirect interest thereinpart thereof, or (ii) permit a Sale any owner, directly or Pledge indirectly, of a direct an ownership interest in the Property, to transfer such interest, whether by transfer of stock or indirect other interest in Borrower or Operating Lesseeany entity, other than (A) the Operating Leaseor otherwise, (Biii) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance incur Indebtedness (other than the Permitted Encumbrances and Room License Agreements hereafter entered into Indebtedness permitted pursuant to the terms of this Agreement), (iv) mortgage, hypothecate or otherwise encumber or grant a security interest in the ordinary course Property or any part thereof, (v) sell, assign, convey, transfer, mortgage, encumber, grant a security interest in, or otherwise dispose of operating any direct or indirect ownership interest in Borrower, or permit any owner of an interest in Borrower to do the same, or (vi) file a declaration of condominium with respect to the Property (any of the foregoing transactions, a "TRANSFER"). For purposes hereof, a "Transfer" shall not include any issuance, sale or transfer of interests in Inland Western Retail Real Estate Trust, Inc.
(a) On and after the date that is twelve (12) months following the Closing Date, Lender shall not withhold its consent to a Transfer of the Property)) is permitted , provided that the following conditions are satisfied:
(i1) the transferee of the Property shall be a Special Purpose Entity (the "TRANSFEREE") which at the time of such transfer will be in compliance with the covenants contained in Section 5.1.1 and the representations contained in 4.1.30 hereof and which shall have assumed in writing (subject to the terms of Section 9.4 hereof) and agreed to comply with all the terms, covenants and conditions set forth in this Loan Agreement and the other Loan Documents, expressly including the covenants contained in Section 5.1.1 and the representations contained in 4.1.30 hereof;
(2) if requested by Lender, Borrower shall deliver confirmation in writing from the Rating Agencies that such proposed Transfer will not cause a downgrading, withdrawal or qualification of the then current rating of any securities issued pursuant to such Securitization;
(3) if Manager does not act as manager of the transferred Property then the manager of the Property must be a Qualifying Manager;
(4) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Defaultcontinuing;
(ii5) the Person to whom the Property is sold if required or conveyed (the “Transferee”) satisfies the requirements requested by any of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender Borrower shall have consented caused counsel to such sale or conveyance, render a substantive non-consolidation opinion which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which in each case may be relied upon by Lenderthe holder of the Note, the Rating Ratings Agencies and their respective successors counsel, agents and assigns, representatives with respect to the Transferee and its applicable affiliatesproposed transaction, including the Transferee, which Additional Insolvency Opinion opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agenciesin its reasonable discretion;
(v6) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
have paid (viA) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan an assumption fee of 1% equal to one percent (1.0%) of the then outstanding principal amount balance of the Loan;
, and (viiiB) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower reasonable and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and customary third-party expenses (including any reasonable attorneys' fees due to the Rating Agenciesand disbursements) actually incurred by Lender in connection with such Transfer; PROVIDED, HOWEVER, no assumption fee shall be required for a Transfer of the sale Property to a Transferee acceptable to Lender in connection with a joint venture between Inland Western Retail Real Estate Trust, Inc. and an institution acceptable to Lender provided Inland Western Retail Real Estate Trust, Inc., or conveyancean Affiliate wholly-owned (directly or indirectly) by Inland Western Retail Real Estate Trust, Inc., owns at least twenty percent (20%) of the ownership interests in such Transferee and for which Inland Western Retail Real Estate Trust, Inc., or an Affiliate wholly-owned (directly or indirectly) by Inland Western Retail Real Estate Trust, Inc., is the managing entity and otherwise maintains operational and managerial control of such Transferee, provided that Borrower shall pay all of Lender's reasonable and customary third-party expenses (including reasonable attorneys' fees and disbursements) actually incurred by Lender in connection with such Transfer and a processing fee of $5,000. Lender shall approve or disapprove any proposed Transfer governed by this Section 5.2.13(a) within thirty (30) days of Lender's receipt of a written notice from Borrower requesting Lender's approval, provided such notice includes all information necessary to make such decision, and further provided that such written notice from Borrower shall conspicuously state, in large bold type, that "PURSUANT TO SECTION 5.2.13 OF THE LOAN AGREEMENT, A RESPONSE IS REQUIRED WITHIN THIRTY (30) DAYS OF LENDER'S RECEIPT OF THIS WRITTEN NOTICE". If Lender fails to disapprove any such matter within such period, Borrower shall provide a second written notice requesting approval, which written notice shall conspicuously state, in large bold type, that "PURSUANT TO SECTION 5.2.13 OF THE LOAN AGREEMENT, THE MATTER DESCRIBED HEREIN SHALL BE DEEMED APPROVED IF LENDER DOES NOT RESPOND TO THE CONTRARY WITHIN TEN (10) DAYS OF LENDER'S RECEIPT OF THIS WRITTEN NOTICE". Thereafter, if Lender does not disapprove such matter within said ten (10) day period such matter shall be deemed approved.
(cb) A Transfer On and after the date that is twelve (but not a pledge, hypothecation, creation of a security interest in or other encumbrance12) of any direct or indirect interests in Borrower is permitted provided that months following the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a SecuritizationClosing Date, Lender shall have consented to such sale or conveyancenot withhold its consent to, which consent and shall not be unreasonably withheld; provided howevercharge an assumption fee in connection with, Lender’s consent shall not be required if(1) a Transfer of up to, after giving effect to in the Transferaggregate, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
forty-nine percent (ii49%) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to Borrower, or (2) a Person individually or together with its Affiliates not owning at least Transfer of greater than forty-nine percent (49% %) of the direct or indirect ownership interests interest in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed PROVIDED that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented such transfer is to such Transfer a Qualified Entity (as defined below), and (B) Borrower shall pay to all of Lender's reasonable and customary third-party expenses (including reasonable attorneys' fees and disbursements) actually incurred by Lender in connection with such Transfer and a loan assumption processing fee of 1$5,000. For purposes of this Agreement, a "QUALIFIED ENTITY" shall mean an entity (x) with a net worth of $200,000,000 or more, (y) with sufficient experience (determined by Lender in its reasonable discretion) in the ownership and management of properties similar to the Property, and (z) which owns or manages retail properties containing at least 1,000,000 square feet of gross leasable area. If required or requested by any of the Rating Agencies, Borrower shall deliver a substantive non- consolidation opinion with respect to any party not now owning more than 49% of the then outstanding principal amount ownership interests in Borrower acquiring more than 49% of the Loanownership interests in Borrower.
(c) Notwithstanding anything in this Section 5.2.13 to the contrary, on or after the date that is twelve (12) months after the Closing Date, Borrower shall be permitted to Transfer the entire Property in a single transaction to one newly-formed Special Purpose Entity which shall be wholly-owned subsidiary of Inland Western Retail Real Estate Trust, Inc. or an affiliate thereof ("PERMITTED AFFILIATE TRANSFEREE") which shall be approved by Lender in its reasonable discretion ("PERMITTED AFFILIATE TRANSFER"), provided (1) no Event of Default shall have occurred and be continuing, (2) the creditworthiness of Inland Western Retail Real Estate Trust, Inc., as applicable, has not deteriorated, in the sole discretion of Lender, from the Closing Date to the date of the proposed Transfer, and (3) Borrower shall have paid all reasonable and customary third party expenses (including reasonable attorneys' fees and disbursements) actually incurred by Lender in connection with such Transfer (but not any assumption or processing fee).
(d) Borrower, without the consent of Lender, may grant easements, restrictions, covenants, reservations and rights of way in the ordinary course of business for access, parking, water and sewer lines, telephone and telegraph lines, electric lines and other utilities or for other similar purposes, provided that no transfer, conveyance or encumbrance shall materially impair the utility and operation of the Property or materially adversely affect the value of the Property or the Net Operating Income of the Property. If Borrower shall receive any consideration in connection with any of said described transfers or conveyances, Borrower shall have the right to use any such proceeds in connection with any alterations performed in connection therewith, or required thereby. In connection with any transfer, conveyance or encumbrance permitted above, the Lender shall execute and deliver any instrument reasonably necessary or appropriate to evidence its consent to said action or to subordinate the Lien of the Mortgage to such easements, restrictions, covenants, reservations and rights of way or other similar grants upon receipt by the Lender of: (A) a copy of the instrument of transfer; and (B) an Officer's Certificate stating with respect to any transfer described above, that such transfer does not materially impair the utility and operation of the Property or materially reduce the value of the Property or the Net Operating Income of the Property.
Appears in 1 contract
Sources: Loan Agreement (Inland Western Retail Real Estate Trust Inc)
Transfers. Landlord shall have the right to subordinate this Lease to any mortgage presently existing or hereafter placed upon the Building by so declaring in such mortgage. In the event of a sale or transfer of such interest (a) Without except a mortgage or other transfer as security for a debt), the prior written consent "Landlord" named herein, or in the case of Lendera subsequent transfer, the transferor shall, after the date of such transfer, be automatically released from all personal liability for the performance or observance of any term, condition, covenant or obligation required to be performed or observed by Landlord hereunder, and except the transferee shall be deemed to have assumed all of such terms, conditions, covenants and obligations. Within ten (10) days following receipt of a written request from Landlord, Tenant shall execute and deliver to Landlord, without cost, any instrument which Landlord deems necessary or desirable to confirm the extent otherwise set forth subordination of this Lease and an estoppel certificate in this Section 5.2.10 and Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): such form as Landlord may reasonably request certifying (i) sellthat this Lease is in full force and effect and unmodified or stating the nature of any modification, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect interest therein, or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person date to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender andwhich rent has been paid, after a Securitization, to the Rating Agencies;
(iii) that there are not, to Tenant's knowledge, any uncured defaults or specifying such defaults if such sale or conveyance occurs prior to a Securitizationany are claimed, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
and (iv) Lender has received an Additional Insolvency Opinion which any other matters or state of facts reasonably required respecting the Lease. Such estoppel may be relied upon by LenderLandlord and by any purchaser or mortgagee of the Building. Notwithstanding the foregoing, if the Rating Agencies and their respective successors and assigns, with respect mortgagee shall take title to the Transferee and its applicable affiliatesLeased Premises through foreclosure or deed in lieu of foreclosure, which Additional Insolvency Opinion Tenant shall be reasonably acceptable allowed to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as continue in possession of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under Leased Premises as provided for in this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent Lease so long as Tenant shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loandefault.
Appears in 1 contract
Sources: Industrial Lease Agreement (United Stationers Supply Co)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members and (if Borrower is a trust) beneficial owners, as applicable, and principals of Borrower in owning the Collateral in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the other obligations of Borrower set forth in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Collateral so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the other obligations of Borrower set forth in the Loan Documents, Lender can recover the Debt by a sale of the Collateral.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property any Individual Property, or all or any direct part of the Collateral or indirect any part thereof or any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of an interest in any Restricted Party, other than, in either case, to the extent that such Transfer constitutes a Permitted Transfer. Any Transfer made without Lender’s prior written consent (to the extent that such consent is required pursuant to this Section 5.2.10) shall be null and void. For the avoidance of doubt, notwithstanding anything in this Agreement to the contrary, the Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance an Excluded Entity shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of constitute a Special Purpose Entity Transfer and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon effectuated by the applicable Person without the consent of, or any notice to, Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Collateral or any part thereof or Mortgage Borrower agrees to sell the Individual Property or any part thereof, in each case for a pledgeprice to be paid in installments; (ii) an agreement by Mortgage Borrower leasing all or a substantial part of an Individual Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Mortgage Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non- member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions are satisfied:creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(id) if such sale or conveyance occurs prior Notwithstanding the provisions of this Section 5.2.10 but subject to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverthe final two sentences of this Section 5.2.10(d), Lender’s consent shall not be required ifin connection with one or a series of Transfers, of not more than forty-nine percent (49%) of the stock, limited partnership interests or membership interests (provided that, in the case of any multi-member Restricted Party, excluding any interests of the managing member) (as the case may be) in a Restricted Party; provided, however, (i) no such Transfer shall result in the change of Control in a Restricted Party, (ii) as a condition to each such Transfer, Lender shall receive not less than thirty (30) days’ prior written notice of such proposed Transfer, and (iii) if after giving effect to the any such Transfer, Sponsor owns not more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than 51% forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the equity interests in Closing Date, Borrower and controlsshall, directly or indirectly, Borrower;
no less than thirty (ii30) if as a result days prior to the effective date of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Transfer, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, following a Securitization, acceptable to the Rating Agencies. Notwithstanding anything contained in this Section 5.2.10(d), no Transfer of any direct ownership interests in any Borrower, any SPE Constituent Entity, any Mortgage Borrower, any Mortgage SPE Constituent Entity, any Junior Mezzanine Borrower or any Junior Mezzanine SPE Entity shall be permitted. In addition, at all times, Guarantor must continue to Control Borrower, each SPE Constituent Entity, Mortgage Borrower, each Mortgage SPE Constituent Entity, each Junior Mezzanine Borrower, and each Junior Mezzanine SPE Constituent Entity and own, directly or indirectly, at least a fifty-one percent (51%) legal and beneficial interest in Borrower, each SPE Constituent Entity, Mortgage Borrower, each Mortgage Borrower SPE Constituent Entity, each Junior Mezzanine Borrower, and each Junior Mezzanine SPE Constituent Entity.
(e) No Transfer of all of the Properties and assumption of the Loan shall occur during the period that is sixty (60) days prior to a Securitization or the period that is sixty (60) days after a Securitization. Otherwise, Lender’s consent to a one (1) time Transfer of all of the Rating Agencies;
Properties or of Mortgage Borrower and Borrower, in each case, that results in an assumption of the entire Loan and the Mortgage Loan by the proposed Transferee (iiithe “Transferee”) at the time shall be given in Lender’s sole discretion provided that Lender receives sixty (60) days’ prior written notice of such Transfer and no Event of Default has occurred and is continuingcontinuing at the time Lender receives such notice and at the time such Transfer is consummated. In determining whether to consent to any proposed Transfer pursuant to this Section 5.2.10(e), Lender may require or consider, without limitation, the following actions and matters:
(i) Borrower shall pay Lender a fee equal to one-half percent (0.5%) of the outstanding principal balance of the Loan at the time of such Transfer;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(viii) Borrower shall pay, or cause to be paid, to Lender its pay any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs incurred in connection with such sale Transfer (including, without limitation, Lender’s reasonable counsel fees and disbursements and all recording fees, title insurance premiums (whether for title insurance with respect to the Properties and/or UCC title insurance with respect to the Collateral) and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) Transferee or conveyanceTransferee’s Sponsors must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Properties, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Sponsors shall, as of the date of such Transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender;
(v) Transferee, Transferee’s Sponsors and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Sponsors (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Sponsors or any Related Entities which is not reasonably acceptable to Lender;
(viii) Transferee, Transferee’s Sponsors and any Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) Transferee and Transferee’s SPE Constituent Entities must be able to make all of the representations set forth in Sections 4.1.30, 4.1.35, and 4.1.38 of each of this Agreement and the Mortgage Loan Agreement, and perform all of the covenants set forth in the respective Sections 5.1.27, 5.1.32 and 5.2.9 of each of this Agreement and the Mortgage Loan Agreement, as applicable, no Default or Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s SPE Constituent Entities shall deliver (A) all Organizational Documents reasonably requested by Lender, which shall be reasonably satisfactory to Lender, and (B) all certificates, agreements, covenants and legal opinions reasonably required by Lender;
(x) Following a Securitization, if required by Lender, Transferee shall be approved by the Rating Agencies rating the Loan, which approval, if required by Lender, shall take the form of a Rating Agency Confirmation with respect to such Transfer;
(xi) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and the Environmental Indemnity or executed a replacement guaranty and/or environmental indemnity agreement reasonably satisfactory to Lender;
(xii) Borrower shall deliver, at its sole cost and expense, (A) an endorsement to the UCC Title Insurance Policy confirming the Lien of the Pledge Agreement, as modified by the assumption agreement, as a valid first lien on the Collateral and naming Transferee as owner of the Collateral, which endorsement shall insure that, as of the date that such Transferee assumes the Loan, the Collateral shall not be subject to any additional exceptions or Liens other than those contained in the UCC Title Insurance Policy issued on the Closing Date and (B) in the case of a Transfer that includes the Transfer of the Properties, an owner’s title insurance policy reasonably acceptable to Lender insuring that the applicable Transferee has (a) good and insurable leasehold title to each Ground Lease Property, (b) good and insurable fee simple title to the real property comprising part of each Individual Property (excluding each Ground Lease Property), and (c) good title to the balance of such Individual Property, free and clear of all Liens whatsoever except Permitted Encumbrances;
(xiii) Each Individual Property shall be managed by Qualified Manager (and, if the Qualified Manager managing any one or more Individual Properties prior to the Transfer is being replaced, the replacement Qualified Manager shall manage such Individual Properties pursuant to a Replacement Management Agreement);
(xiv) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender (A) an Additional Insolvency Opinion in respect of such Transfer satisfactory in form and substance to Lender and (B) a fraudulent conveyance opinion in respect of such Transfer, each of which opinions may be relied upon by Lender and the Rating Agencies with respect to the proposed Transfer;
(xv) if the Junior Mezzanine Loan is still outstanding, Junior Mezzanine Borrower shall have complied with all of the terms and conditions set forth in the Junior Mezzanine Loan Documents with respect to the Transfer and to effectuate the assumption of the Junior Mezzanine Loan; and
(viixvi) in connection Mortgage Borrower shall have complied with any Transfer as a result of which Sponsor will not own at least 51% all of the equity interests terms and conditions set forth in the Mortgage Loan Documents with respect to the Transfer and the assumption of the Mortgage Loan and Mortgage Lender shall have approved such Transfer pursuant to the Mortgage Loan Documents. Immediately upon the consummation of a Transfer pursuant to this Section 5.2.10(e) (provided that Lender has consented thereto in accordance with the foregoing), each Borrower and controlGuarantor shall be released from all liability under this Agreement, directly or indirectlythe Note, Borrowerthe Pledge Agreement and the other Loan Documents and, Borrower shall give or cause to be given written notice to Lender in the case of an assumption of the proposed Transfer not later than fifteen Mortgage Loan, each Mortgage Borrower and Guarantor (15) days prior theretoas defined in the Mortgage Loan Agreement shall be released from all liability under the Mortgage Loan Documents, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth each case accruing after the date of such Transfer (other than to the Transfer extent such liability is expected expressly stated herein to survive). The foregoing release shall be effective and upon the date of such Transfer, but Lender agrees to provide written evidence thereof if the same is reasonably requested by Borrower.
(Af) Lender shall have consented not be required to such demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon the consummation of a purported Transfer that is prohibited (and (Bas such, null and void) Borrower shall pay pursuant to Lender a loan assumption fee the terms of 1% of the then outstanding principal amount of the Loanthis Section 5.
Appears in 1 contract
Sources: Senior Mezzanine Loan Agreement (Brixmor Property Group Inc.)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners, as applicable, in owning and operating properties such as the Property, in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Property. Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyTransfer Restricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, license, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) permit a Sale or Pledge of a direct or indirect any interest in Borrower any Transfer Restricted Party (any of the actions in the foregoing clauses (i) or Operating Lessee(ii), a “Transfer”), other than than, notwithstanding anything to the contrary contained in this Section 5.2.10, (A) the Operating Lease, (B) pursuant to Leases of space in at the Improvements Property to tenants in accordance with the provisions of Section 5.1.205.1.20 hereof, (B) a Five Acre Release in accordance with Section 2.5 hereof, (C) Permitted Encumbrances, (D) the Room License Agreementsissuance of new stock in, the merger or consolidation of, and/or the Sale or Pledge of the stock in, any Publicly Traded Entity who owns a direct or indirect ownership interest in any Transfer Restricted Party, (E) the transfer of indirect ownership interests in Borrower in order to create one or more new mezzanine borrowers for any New Mezzanine Loan as contemplated hereunder, (F) the transfer by deed of the Six Acre Parcel to a Subsidiary Transferee and the subsequent transfer of all of the membership interests held by Borrower in such Subsidiary Transferee, in each instance in accordance with Section 5.2.11(d) hereof, as applicable, and (DG) Permitted Transfersthe Assumption; provided, however, that in the case of each of the foregoing clauses (A) – (G), such Transfer shall only be permitted hereunder if it does not violate any Legal Requirements.
(b) Notwithstanding A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the foregoing, Property or any part thereof for a sale or conveyance price to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property subject to the lien of the Mortgage (but not any for other mortgagethan actual occupancy by a space tenant thereunder or a sale, lien assignment or other encumbrance (other than transfer of, or the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements grant of a Special Purpose Entity security interest in, Borrower’s right, title and the organizational documents of the Transferee are reasonably acceptable interest in and to Lender and, after a Securitization, to the Rating Agencies;
any Leases or any Rents; (iii) if a Transfer Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such sale corporation’s stock or conveyance occurs prior to a Securitization, Lender shall have consented to such sale the creation or conveyance, which consent shall not be unreasonably withheld;
issuance of new stock; (iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lenderif a Transfer Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the Rating Agencies and their respective successors and assignschange, with respect removal, resignation, admission or addition of a general partner or the Sale or Pledge of the general partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable Sale or Pledge of limited partnership interests or any profits or proceeds relating to Lender or, after a Securitization, such limited partnership interest or the Rating Agencies;
creation or issuance of new limited partnership interests; (v) if a Transfer Restricted Party is a limited liability company, any merger or consolidation or the Transferee shall execute an assumptionchange, effective as removal, resignation, admission or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the date membership interest of transfera managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of all non-managing or managing membership interests or the creation or issuance of the obligations of the Borrower thereafter arising new non-managing or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
managing membership interests; or (vi) following such sale if a Transfer Restricted Party is a trust or conveyance nominee trust, any merger, consolidation or the property manager Sale or Pledge of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale legal or conveyance, in and of itself, will not result beneficial interest in a downgrade, qualification Transfer Restricted Party or withdrawal the creation or issuance of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale new legal or conveyancebeneficial interests.
(c) A Transfer (but Notwithstanding the provisions of this Section 5.2.10, so long as the following Transfers do not a pledgeviolate any Legal Requirements in any instance, hypothecation, creation the following Transfers may occur without the consent of a security interest in Lender or the payment of any transfer or other encumbrancefee:
(A) the Transfer of any direct or indirect interests interest in Borrower is permitted any Transfer Restricted Party, provided that the following conditions are satisfied:
(i1) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
, (iv2) following such Transfer the property manager of the Property must be a Qualified Manager;
(vy) if, after giving effect one or both Guarantors continue to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and controlControl, directly or indirectly, Borrower, Borrower shall give and (z) one or cause to be given both Guarantors own, directly or indirectly, at least a fifty-one percent (51%) economic interest in Borrower, (3) Lender receives (y) at least ten (10) days prior written notice of any such voluntary Transfer and copies of the documents transferring such interest, or (z) written notice of any such involuntary Transfer and copies of the documents transferring such interest within thirty (30) days following such involuntary Transfer, (4) if after such Transfer any Person and its Affiliates collectively would own more than forty-nine (49%) in the aggregate of the direct and/or indirect interests of Borrower and as of the Closing Date such Person and its Affiliates collectively owned forty-nine percent (49%) or less in the aggregate of the direct and/or indirect interests of Borrower, Lender shall have received, prior to such Transfer, an Additional Insolvency Opinion reasonably satisfactory to Lender and the Rating Agencies and, if a Securitization has occurred, a confirmation in writing from the Rating Agencies to the effect that such Transfer will not result in a re-qualification, reduction or withdrawal of the proposed then current rating assigned to the Securities or any class thereof in any applicable Securitization, and (5) Borrower delivers to Lender a copy of any consents or approvals required by any Governmental Authority in connection with such Transfer;
(B) the Transfer of any direct or indirect interest in any Transfer Restricted Party to any other Person who is, as of the Closing Date, a holder of any direct or indirect interest in any Transfer Restricted Party, provided that (1) no Event of Default has occurred and is continuing, (2) (y) one or both Guarantors continue to Control, directly or indirectly, Borrower, and (z) one or both Guarantors own, directly or indirectly, at least a fifty-one percent (51%) economic interest in Borrower, (3) Lender receives (y) at least ten (10) days prior written notice of any such voluntary Transfer and copies of the documents transferring such interest, or (z) written notice of any such involuntary Transfer and copies of the documents transferring such interest within thirty (30) days following such involuntary Transfer, and (4) Borrower delivers to Lender a copy of any consents or approvals required by any Governmental Authority in connection with such Transfer;
(C) the Transfer of any direct or indirect interest in any Transfer Restricted Party by inheritance, devise, bequest or operation of law upon the death of a natural person who owned such interest, provided that (1) such Transfer is to a non-minor member of the immediate family of the deceased holder of such interest or a trust established for the benefit of one or more members of the immediate family of the deceased holder of such interest, (2) (y) one or both Guarantors continue to Control, directly or indirectly, Borrower, and (z) one or both Guarantors own, directly or indirectly, at least a fifty-one percent (51%) economic interest in Borrower, (3) such Transfer shall not result in a change of Control of the day-to-day operations of the Property, (4) Lender receives written notice of such Transfer and copies of the documents transferring such interest not later than fifteen thirty (1530) days following such Transfer, (5) the legal and financial structure of Borrower and the other Transfer Restricted Parties, and the single purpose nature and bankruptcy remoteness of Borrower and the other Transfer Restricted Parties, after such Transfer shall satisfy the applicable provisions of the Loan Documents, including, without limitation, Section 4.1.30 hereof, (6) if after such Transfer any Person and its Affiliates would collectively own more than forty-nine (49%) in the aggregate of the direct and/or indirect interests of Borrower and as of the Closing Date such Person and its Affiliates collectively owned forty-nine percent (49%) or less in the aggregate of the direct and/or indirect interests of Borrower, Lender shall have received an Additional Insolvency Opinion reasonably satisfactory to Lender and the Rating Agencies and, if a Securitization has occurred, a confirmation in writing from the Rating Agencies to the effect that such Transfer will not result in a re-qualification, reduction or withdrawal of the then current rating assigned to the Securities or any class thereof in any applicable Securitization, and (7) Borrower delivers to Lender a copy of any consents or approvals required by any Governmental Authority in connection with such Transfer; and
(D) (1) the merger or consolidation of any Guarantor or any Constituent Member of any Guarantor with or into any other Person, (2) the sale of any Guarantor or substantially all of any Guarantor’s assets to any other Person, or (3) the issuance of new stock or limited partnership or membership interests in, and/or the Sale or Pledge of stock, limited partnership or membership interests in, any Guarantor or any Constituent Member thereof (any of the occurrences in the foregoing clauses (1), (2) or (3), a “Guarantor Transfer”); provided, that, in each of the foregoing instances, whether or not the applicable Guarantor or the applicable Constituent Member of a Guarantor is or is not a Publicly Traded Company, (I) after giving effect to such Guarantor Transfer, when viewed both individually and together with any prior Guarantor Transfers, (y) the Guarantors, collectively, shall continue to satisfy the Net Worth Requirements, and (z) at least one of the Guarantors shall be a Qualified Real Estate Guarantor, (II) except if the applicable Guarantor or the applicable Constituent Member of a Guarantor is a Publicly Traded Company, Lender receives at least ten (10) days prior theretowritten notice of any such Guarantor Transfer, which notice shall set forth (III) if after such Guarantor Transfer any Person and its Affiliates collectively would own more than forty-nine (49%) in the name aggregate of the direct and/or indirect interests of Borrower and as of the Closing Date such Person to which and its Affiliates collectively owned forty-nine percent (49%) or less in the interest in Borrower is to be transferredaggregate of the direct and/or indirect interests of Borrower, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented received, prior to such Guarantor Transfer, an Additional Insolvency Opinion reasonably satisfactory to Lender and the Rating Agencies and, if a Securitization has occurred, a confirmation in writing from the Rating Agencies to the effect that such Guarantor Transfer will not result in a re-qualification, reduction or withdrawal of the then current rating assigned to the Securities or any class thereof in any applicable Securitization, and (BIV) Borrower shall pay delivers to Lender a loan assumption fee copy of 1% any consents or approvals required by any Governmental Authority in connection with such Guarantor Transfer.
(d) With respect to any Transfer permitted under this Section 5.2.10 or Section 5.2.11 hereof or otherwise consented to by Lender, Borrower shall pay, in addition to any amounts contemplated under Section 2.5 hereof (without duplication), all fees and expenses incurred by Lender in connection with such Transfer, including, without limitation, the cost of any third party reports, reasonable legal fees and expenses, Rating Agency fees and expenses and required legal opinions.
(e) Notwithstanding anything to the contrary set forth in this Agreement or in any of the then outstanding principal amount other Loan Documents, Borrower expressly acknowledges and agrees, on behalf of itself and the Loanother Transfer Restricted Parties, that any Transfer or Guarantor Transfer stated to be permitted hereunder or thereunder shall only be permitted if it does not violate any Legal Requirements.
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower, Master Tenant and its and Master Tenant’s stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit Master Tenant or any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (CB) the Room License AgreementsHotel Transactions, and (DC) Permitted Transfers.
(bc) Notwithstanding A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower or Master Tenant agrees to sell the foregoing, Property or any part thereof for a sale or conveyance price to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property subject for other than actual occupancy by a space Tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non managing membership interests or the creation or issuance of new non managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding anything to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into contrary contained in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:Loan Documents.
(i) Lender’s consent shall not be required in connection with one (1) or a series of Transfers of up to forty-nine percent (49%) in the aggregate of the direct or indirect ownership interests in any Restricted Party provided that (a) no Event of Default shall have occurred and be continuing and remain uncured or would occur as a result of such sale or conveyance Transfer, (b) such Transfer shall not result in an Event (i) cause the transferee (together with its Affiliates) to acquire Control of Default;
any Restricted Party unless such transferee is Guarantor, (ii) the Person to whom the Property result in any Restricted Party that is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents as of the Transferee are reasonably acceptable to Lender andClosing Date controlled by Guarantor no longer being controlled by Guarantor, after a Securitization, to the Rating Agencies;
or (iii) if cause the transferee (together with its Affiliates) to increase its direct or indirect interest in any Restricted Party to an amount which exceeds forty-nine percent (49%) in the aggregate, unless such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
transferee owned more than forty-nine percent (iv49%) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date direct or indirect ownership interests in such Restricted Party on the Closing Date or as a result of transfer, a Transfer previously made in accordance with the terms and provisions of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vic) following such sale or conveyance the property manager of the Property must shall continue to be managed by Manager or a Qualified Manager; and
, (viid) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned Guarantor shall continue to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controlsown, directly or indirectly, Borrower;
at least fifty-one percent (ii51%) if as a result of any all legal, beneficial and economic interests in each of Borrower and Master Tenant, (e) if, immediately following such Transfer Transfer, the transferee owns ten percent (10%) or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred or Master Tenant then, to a Person individually the extent such transferee did not own ten percent (10%) or together with its Affiliates not owning at least 49% more of the direct or indirect ownership interests in Borrower immediately prior or Master Tenant on the Closing Date, Borrower shall deliver, or cause to be delivered, at Borrower’s sole cost and expense, such searches (including credit, negative news, OFAC, litigation, judgment, lien and bankruptcy searches) as Lender may reasonably require with respect to such Transfer transferee and its Controlling Persons, the results of which must be reasonably acceptable to Lender (unless such transferee and Controlling Persons were previously the subject of searches by Lender which were reasonably acceptable to Lender, in which case Borrower’s obligation to deliver or as reflected in cause the most recent Additional Insolvency Opinion delivery of such searches under this Section 5.2.10(d) shall be satisfied to the extent reasonably acceptable updates to such searches are delivered to Lender), and such transferee, its Borrowers and controlling Persons shall otherwise satisfy Lender’s then current applicable underwriting criteria and requirements, (f) Borrower shall deliver give Lender notice of such Transfer together with copies of all instruments effecting such Transfer (or final drafts thereof with signed copies to follow upon the effect date of such transfer) and the organizational documents of the transferee and its constituent parties reasonably required by Lender an Additional Insolvency Opinion which may be relied upon by Lendernot less than ten (10) days prior to the date of such Transfer), and (g) the Rating Agencies legal and financial structure of Borrower, Master Tenant and their respective counselstockholders, successors members or partners, as applicable, and assignsthe single purpose nature and bankruptcy remoteness of Borrower, with respect Master Tenant and their respective stockholders, members or partners, as applicable, after such Transfer, shall satisfy Lender’s then current applicable underwriting criteria and requirements. Notwithstanding anything in this Section 5.2.10(d) to the proposed transfer or salecontrary, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager without limiting any of the Property must be a Qualified Manager;
(v) ifforegoing requirements of this Section 5.2.10(d), if after giving effect to any such Transfer, Sponsor does not own at least 51% more than forty-nine percent (49%) in the aggregate of direct or indirect ownership interests in any Restricted Party are owned by any Person (together with its Affiliates) that owned less than forty-nine percent (49%) of the equity direct or indirect ownership interests in such Restricted Party as of the Closing Date or as a result of a Transfer previously made in accordance with the terms and provisions of this Agreement, then Borrower and control Borrowershall, prior to the Rating Agencies shall have confirmed that effective date of any such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
deliver (vi) Borrower shall pay, or cause to be paid, delivered) to Lender its reasonable a non-consolidation opinion letter acceptable to Lender and delivered by counsel reasonably satisfactory to Lender; and
(ii) The sale, conveyance, transfer, disposition, alienation, hypothecation, pledge or encumbering of all or any portion of the direct or indirect ownership interests in M▇▇▇▇ REIT II (each a “Permitted REIT Transfer”) shall be permitted at any and all times without (1) Lender’s consent, (2) notice to Lender, or (3) the payment of any fee, premium, penalty or other payment to Lender other than payment of Lender’s actual out-of-pocket expenses expenses, if any, provided, however, that upon completion of such Permitted REIT Transfer (including any fees due to a) except with the Rating AgenciesLender’s prior written consent, M▇▇▇▇ REIT II is a Reporting Company, (b) in connection there is no change of Control of Borrower, Master Tenant, Principal or M▇▇▇▇ REIT II, (c) no Person together with such sale or conveyance; and
Person’s Affiliates, other than the Key Principal and his Affiliates, owns more than forty-nine percent (vii49%) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity direct or indirect ownership interests in Borrower and controlM▇▇▇▇ REIT II, (d) M▇▇▇▇ REIT II continues to own, directly or indirectly, at least seventy-five percent (75%) of the ownership interests in MNOP II and MNOP II continues to own, directly or indirectly, one hundred percent (100%) of the ownership interests in Borrower and Master Tenant, and (e) if the Franchise Agreement will be terminated as a result of any such Permitted REIT Transfer, the Property shall be operated in accordance with a Replacement Franchise Agreement.
(e) For the avoidance of doubt, and notwithstanding anything in this Section 5.2.10 to the contrary, (i) MNOP II must, at all times, own 100% of the direct equity interests in each of Borrower and MN L▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ MT, Inc., a Delaware corporation, (ii) MN L▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ MT, Inc., a Delaware corporation, must, at all times, own 100% of the direct equity interests in Master Tenant, and (iii) M▇▇▇▇ REIT II continues to own, directly or indirectly, at least seventy-five percent (75%) of the ownership interests in MNOP II.
(f) Borrower, without the consent of Lender, may grant easements, restrictions, covenants, reservations and rights of way in the ordinary course of business for water and sewer lines, telephone and telegraph lines, electric lines and other utilities or for other similar purposes, provided that no transfer, conveyance or encumbrance shall materially impair the utility and operation of the Property or materially adversely affect the value of the Property or the Net Operating Income of the Property. If Borrower shall receive any consideration in connection with any of said described transfers or conveyances, provided no Event of Default then exists, Borrower shall give have the right to use any such proceeds in connection with any alterations performed in connection therewith, or cause required thereby. In connection with any transfer, conveyance or encumbrance permitted above, Lender shall, unless it reasonably determines that the foregoing conditions have not been satisfied, execute and deliver any instrument reasonably necessary or appropriate to be given written notice evidence its consent to Lender said action or to subordinate the Lien of the proposed Transfer not later than fifteen (15) days prior theretoSecurity Instrument to such easements, which notice shall set forth restrictions, covenants, reservations and rights of way or other similar grants upon receipt by the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and Lender of: (A) Lender shall have consented to such Transfer a copy of the instrument of transfer; and (B) an Officer’s Certificate stating with respect to any transfer described above, that such transfer does not materially impair the utility and operation of the Property or materially reduce the value of the Property or the Net Operating Income of the Property. Borrower shall pay all of Lender’s reasonable expenses incurred in connection with the foregoing including, reasonable attorney’s fees and expenses Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanhas consented to any previous Transfer.
Appears in 1 contract
Transfers. (a) Without Borrower acknowledges that Lender has examined and relied on the prior written consent experience of LenderBorrower and its stockholders, general partners, members and (if Borrower is a trust) beneficial owners, as applicable, and except principals of Borrower in owning and operating properties such as the Properties in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Properties as a means of maintaining the value of the Properties as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Properties so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Properties.
(b) Except (i) to the extent otherwise set forth in this Section 5.2.10 5.2.10, (ii) with respect to the release of one or more Individual Properties or any portion thereof (and Section 2.5 hereofrelated collateral) in accordance with this Agreement and (iii) to the extent such Transfer constitutes a Permitted Transfer or Permitted Debt, without the prior written consent of Lender, Borrower shall not, not and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (ix) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant purchase options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the any Individual Property or any direct part thereof or indirect any legal or beneficial interest therein, or (iiy) permit a Sale or Pledge of an interest in any Restricted Party or (z) Borrower entering into, or causing the Property to be subject to, any PACE Debt. Any Transfer made without Lender’s prior written consent (to the extent that such consent is required pursuant to this Section 5.2.10) shall be null and void. Notwithstanding anything to the contrary contained herein, Lender’s receipt of a Rating Agency Confirmation shall not be required in connection with any Transfer that is permitted hereunder, including, without limitation, any Permitted Transfer, Permitted Assumption, Controlling Interest Transfer or Public Sale or the replacement of any Guarantor or Ancillary Guarantor in connection therewith that is consummated in accordance with the terms of this Agreement and the terms of the Guaranty or Ancillary Guaranty, as applicable.
(c) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell an Individual Property or any part thereof for a price to be paid in installments; (ii) an agreement by Borrower leasing all or substantially all of an Individual Property to a third party for other than actual occupancy by a space Tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any Division, merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership, any Division, merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any Division, merger or consolidation or the change, removal, resignation or addition of a member or a non‑member manager (other than an Independent Director or Independent Manager that is a springing member in accordance with the terms and conditions hereof) or the Sale or Pledge of the membership interest of a member (other than an Independent Director or Independent Manager that is a springing member in accordance with the terms and conditions hereof) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of membership interests or the creation or issuance of new membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of this Section 5.2.10 the following Transfers shall not require any notice to Lender (unless Borrower is required to deliver any Additional Insolvency Opinion or satisfy any “know your customer” compliance screening as expressly required below) or the consent of Lender or the payment of any transfer fee:
(i) The Sale or Pledge, in one or a series of Transfers, of the direct or indirect equity interests in Borrower or direct or indirect interests in any Restricted Party; provided, that, (A) after giving effect to such Sale or Pledge (and in the case of a Sale or Pledge that is a pledge for security purposes otherwise permitted hereunder, any subsequent foreclosure thereon (other than a Pledge Foreclosure)), one or more Approved Control Party(ies) (x) shall individually or collectively, directly or indirectly, own the applicable Required Ownership Interest, and (y) shall individually or collectively, directly or indirectly, Control Borrower and Mezzanine Borrower, (B) intentionally omitted, (C) intentionally omitted, (D) no Individual Borrower or SPE Constituent Entity shall fail to be a Special Purpose Entity by reason of such Sale or Pledge, (E) for so long as the Loan or any Mezzanine Loan shall remain outstanding (I) no pledge of any direct interests in any Restricted Pledge Party shall be permitted (other than pledges securing the Loan or a New Mezzanine Loan), except that a pledge of the direct ownership interests in any Restricted Pledge Party (other than pledges of the direct ownership interests in Borrower (or, if any Mezzanine Loan is outstanding, any Mezzanine Borrower)) shall be permitted if such pledge directly or indirectly secures indebtedness that is also directly or indirectly secured by substantial assets other than the Properties and (II) no Restricted Pledge Party shall issue preferred equity that is substantially similar to mezzanine debt (such as preferred equity which has a fixed maturity date, pledged ownership interests as security and rights of the equity holder to demand repayment of its investment on such maturity date) and (F) with respect to any transferee that, as a result of such Transfer, will hold a twenty percent (20%) or greater direct or indirect interest in, or Control, Borrower (and such transferee owned less than twenty percent (20%) of the direct or indirect interest in Borrower or Operating Lesseedid not Control Borrower immediately prior to such Transfer), other than Lender shall receive notice of such transfer (A) provided, however, the Operating Lease, (B) pursuant failure to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and provide such sale or conveyance notice shall not result in constitute an Event of Default;
) and shall receive KYC Searches with respect to such transferee. Notwithstanding anything to the contrary contained in the Loan Documents, no notice to or consent of Lender shall be required in connection with (i) any foreclosure of any pledge of an indirect equity interest in Borrower or (ii) the Person exercise of remedies or acquisition of Control by a provider of preferred equity or debt to whom the Property an indirect owner of Borrower, in each case, that is sold or conveyed permitted by this Agreement (the a “TransfereePledge Foreclosure”) satisfies that may or may not result in a change of Control of Borrower and no assumption fee shall be payable in connection therewith; provided that (x) the requirements foreclosing party or the party acquiring Control of a Special Purpose Entity Borrower or exercising remedies is an Eligible Assignee that is able to remake the applicable representations set forth in Section 4.1.35 and the organizational documents of the Transferee are reasonably acceptable is able to Lender and, after a Securitization, to the Rating Agencies;
comply with Borrowers’ covenants set forth in Section 5.1.27 and (iiiy) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented receive notice of such transfer (provided, however, the failure to provide such sale or conveyance, which consent notice shall not be unreasonably withheld;
(ivconstitute an Event of Default) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, and shall have the Rating Agencies and their respective successors and assigns, right to receive the KYC Searches with respect to the Transferee any Person that holds a twenty percent (20%) or greater direct or indirect interest in, or Controls, Borrower following such Pledge Foreclosure (and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
such transferee owned less than twenty percent (v20%) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the direct or indirect interest in Borrower thereafter arising or did not Control Borrower immediately prior to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, Pledge Foreclosure). If after giving effect to any such Transfersale, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
more than forty-nine percent (ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies49%) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation aggregate of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided and/or any SPE Constituent Entity are owned by any Person and its Affiliates that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not owned less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
forty-nine percent (ii49%) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests interest in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% and/or such SPE Constituent Entity, as applicable, as of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after following a Rated Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned . Notwithstanding anything to the Securities
contrary contained in this Agreement, (vix) Borrower shall payno notice to, or cause to consent of, Lender shall be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) required in connection with any Sale or Pledge of direct or indirect interests in any Excluded Entity or by and among any Excluded Entity and (y) subject to sub-clause (I) above, no Restricted Pledge Party (other than Borrower or a New Mezzanine Borrower) shall be restricted from any Sale or Pledge of its direct or indirect assets; provided such direct or indirect assets are not encumbered (or required to be encumbered) by the Loan or the Mezzanine Loan. In connection with a Controlling Interest Transfer as or any other Transfer (including, for the avoidance of doubt, without limitation, a Pledge Foreclosure), the result of which Sponsor will not own at least 51% of the equity interests in Borrower and controlis that Guarantor or any Ancillary Guarantor, directly as applicable, no longer owns a direct or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the indirect interest in or is no longer an Affiliate of Borrower is (individually or collectively as the context requires, the “Exiting Guarantor”), Exiting Guarantor shall be released as a guarantor under the (I) Guaranty for any acts occurring from and after such Transfer; provided that a Guaranty Assumption occurs with respect to be transferredthe Guaranty (the “Non-Recourse Assumption”), identify the proposed transferee and set forth the date the Transfer is expected to be effective and (AII) Lender shall have consented to such Transfer and Rate Cap Reserve Guaranty (Bif any) provided that (x) Borrower shall pay to Lender an amount equal to all amounts guaranteed under the Rate Cap Reserve Guaranty as of such date which amounts shall be deposited by Lender into the Rate Cap Reserve Account or (y) a loan assumption fee Guaranty Assumption occurs with respect to the Rate Cap Reserve Guaranty (the “Rate Cap Guaranty Assumption”), (III) Alterations Guaranty (if any), provided that (x) Borrower shall pay to Lender an amount equal to all amounts guaranteed under the Alterations Guaranty as of 1% such date which amounts shall be held by Lender as the Alterations Deposit or (y) a Guaranty Assumption occurs with respect to the Alterations Guaranty (the “Alterations Guaranty Assumption”), (IV) Excess Cash Flow Guaranty (if any), provided that (x) Borrower shall pay to Lender an amount equal to all amounts guaranteed under the Excess Cash Flow Guaranty as of such date which amounts shall be deposited by Lender into the then outstanding principal Excess Cash Flow Reserve Account or (y) a Guaranty Assumption occurs with respect to the Excess Cash Flow Guaranty (the “Excess Cash Flow Guaranty Assumption”), and (V) Debt Yield Trigger Cure Guaranty (if any), provided that, at the election of Borrower, (v) Borrower shall pay to Lender an amount equal to all amounts guaranteed under the Debt Yield Trigger Cure Guaranty as of such date (the “DY Guaranty Amount”) to be applied as a prepayment of the Loan, (w) Borrower shall pay to Lender an amount equal to the DY Guaranty Amount to be held by Lender as Debt Yield Cure Collateral in accordance with the definition thereof, (x) Borrower delivers to Lender a Letter of Credit in an amount equal to the DY Guaranty Amount to be held by Lender as Debt Yield Cure Collateral in accordance with the definition thereof, (y) Borrower shall pay to Lender an amount equal to the DY Guaranty Amount which shall be deposited by Lender into the Cash Management Account at which point a Debt Yield Trigger Event shall be deemed to exist until a Debt Yield Trigger Event Cure has taken place or (z) a Guaranty Assumption occurs with respect to the Debt Yield Trigger Cure Guaranty (the “Debt Yield Trigger Cure Guaranty Assumption”) and (VI) Deductible Guaranty (if any), provided that, at the election of Borrower, (x) Borrower obtains and maintains insurance coverage sufficient to meet the requirements of Section 6.1(a)(i)(C) in which case the Deductible Guaranty will automatically terminate in accordance with Section 1.4 thereof or (y) a Guaranty Assumption occurs with respect to the Deductible Guaranty (the “Deductible Guaranty Assumption”) with the conditions set forth in clauses (I) through (VI) above shall be referred to herein as the “Guaranty Release Conditions”, and the release of the applicable Guarantor or Ancillary Guarantor shall be referred to herein as the “Guarantor Release”. Each Guarantor Release shall be effective automatically upon satisfaction of the applicable Guaranty Release Conditions, but Lender agrees to provide written evidence thereof, at Borrower’s sole cost and expense, if the same is reasonably requested by Borrower.
(ii) A Public Sale; provided that (A) if after giving effect to any such Public Sale, more than forty-nine percent (49%) in the aggregate of the direct or indirect interests in Borrower and/or any SPE Constituent Entity are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) of the direct or indirect interest in Borrower and/or such SPE Constituent Entity, as applicable, as of the Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion reasonably acceptable to Lender and, to the extent a Rated Securitization has occurred, the Rating Agencies, (B) Borrower and any SPE Constituent Entity shall not fail to be a Special Purpose Entity by reason of such Public Sale and (C) with respect to any transferee that, as a result of such transfer, will hold a twenty percent (20%) or greater direct or indirect interest in, or Control, Borrower (and such transferee owned less than twenty percent (20%) of the direct or indirect interest in Borrower or did not Control Borrower immediately prior to such Public Sale), Lender shall receive KYC Searches with respect to such transferee. Upon completion of any such Public Sale subject to and in accordance with the provisions of this Section 5.2.10(d)(ii), Borrower shall have the right to cause the Non-Recourse Assumption, the Rate Cap Guaranty Assumption, the Alterations Guaranty Assumption, the Excess Cash Flow Guaranty Assumption, the Debt Yield Trigger Cure Guaranty Assumption and/or the Deductible Guaranty Assumption and each Guarantor Release shall be effective automatically upon satisfaction of the applicable Guaranty Release Conditions and Lender agrees to provide written evidence of such Guarantor Release if the same is reasonably requested by Borrower. Following any Transfer in accordance with this Section 5.2.10(d)(ii), the Qualified Public Company shall be deemed to be an Excluded Entity. For purposes of clarity, the provisions of Section 5.2.3 and this Section 5.2.10 shall not restrict the Qualified Public Company or Public Vehicle (or any direct or indirect owner of the Qualified Public Company or Public Vehicle, but excluding any Borrower, any New Mezzanine Borrower or any SPE Constituent Entity) from effectuating a restructuring and such Qualified Public Company or Public Vehicle (or any direct or indirect owner of the Qualified Public Company or Public Vehicle, but excluding any Borrower, any New Mezzanine Borrower or any SPE Constituent Entity) shall be permitted to effectuate a restructuring, including amending or modifying its organizational documents, intercompany commercial arrangements or governance including any amendments or modifications reasonably determined by such Qualified Public Company or Public Vehicle to be required to satisfy stock exchange, quotation system listing or tradi
Appears in 1 contract
Transfers. (a) Borrower acknowledges that L▇▇▇▇▇ has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on B▇▇▇▇▇▇▇’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that L▇▇▇▇▇ has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, L▇▇▇▇▇ can recover the Debt by a sale of the Property.
(b) Without the prior written consent of LenderL▇▇▇▇▇, not to be unreasonably withheld, delayed or conditioned, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof (except in connection with any Condemnation) or indirect any legal or beneficial interest therein, therein or any interest of Borrower in the Loan or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 hereof and (DB) Permitted Transfers.
. For the avoidance of doubt, in no event shall the Transfers described in clauses (a), (b), (c), (d), (g), (h) Notwithstanding the foregoing, a sale or conveyance by Borrower (j) of the Property subject to the lien definition of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the “Permitted Encumbrances and Room License Agreements hereafter entered into Transfers” set forth in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which Section 1.1 hereof require consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitizationexcept as otherwise expressly required hereunder, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or notice to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer shall include (but not i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of any Individual Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, B▇▇▇▇▇▇▇’s right, title and interest in and to any Leases or other encumbranceany Rents or any Property Documents; (iii) if a Restricted Party is a corporation, any merger, consolidation division into two (2) or more legal entities or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation, division into two (2) or more legal entities or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation, division into two (2) or more legal entities or the change, removal, resignation or addition of a managing member or nonmember manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of nonmanaging membership interests or the creation or issuance of new nonmanaging membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation, division into two (2) or more legal entities or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; (vii) the removal or the resignation of the Manager (including an Affiliated Manager) other than in accordance with Section 5.1.22 hereof; or (viii) Borrower is permitted provided that the following conditions are satisfied:entering into or affirmatively consenting to any P▇▇▇ ▇▇▇▇.
(id) if such sale or conveyance occurs prior to a SecuritizationNotwithstanding the provisions of this Section 5.2.10, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, LenderL▇▇▇▇▇’s consent shall not be required ifin connection with one or a series of Transfers, after giving effect of not more than forty-nine percent (49%) of the direct or indirect ownership interests in a Restricted Party; provided, however, no such Transfer shall result in the change of Control in Borrower or Guarantor, and as a condition to each such Transfer that results in the transferee, if such transferee is a non-U.S. Person, owning ten percent (10%) or more of the direct or indirect ownership interests in a Borrower or, if such transferee is a U.S. Person, owning twenty percent (20%) or more of the direct or indirect ownership interests in a Borrower (which such transferee did not own 10% or more (if a non-U.S. Person) or 20% of more (if a U.S. Person) of the direct or indirect ownership interests in a Borrower prior to such Transfer), Sponsor owns (i) Borrower shall provide to Lender, not less than 51% ten (10) days prior to such transfer, the name and identity of each proposed transferee, together with the equity interests in Borrower names of its controlling principals, the social security number (if applicable) or employee identification number (if applicable) of such transferee and controlscontrolling principals (if applicable), directly and such transferee’s and, if applicable, controlling principal’s home address or indirectlyprincipal place of business, Borrower;
and home or business telephone number (if applicable) and (ii) Lender shall have received Satisfactory Search Results with respect to the proposed transferee and such controlling principals, if applicable; provided, further, however, the foregoing clause (i) and (ii) shall not be applicable in connection with any transfer (or pledging) of stock or membership interests in any publicly-held corporation or other publicly-held entity (in each case) which is listed on the New York Stock Exchange, the NASDAQ Global Select Market or another nationally-recognized stock exchange, or transfer or issuance of securities of the REIT provided that such securities are listed on the New York Stock Exchange, the NASDAQ Global Select Market or another nationally recognized stock exchange. If as a result of any such Transfer or series of Transfers Transfer, more than forty-nine percent (49% %) of the direct or indirect ownership interests in Borrower shall be transferred to a or Guarantor are owned by any Person individually or together with and its Affiliates not owning at least that owned less than forty-nine percent (49% %) of the aggregate direct or indirect ownership interests in Borrower or Guarantor as of the Closing Date, and if such Persons are not already included in the pairings of the Insolvency Opinion most recently delivered in connection with the Loan, Borrower shall, no less than ten (10) days prior to the effective date of any such Transfer, deliver to Lender an Additional Insolvency Opinion reasonably acceptable to Lender and (if a Securitization has occurred) the Rating Agencies (which Additional Insolvency Opinion may be on the same form as the Insolvency Opinion provided on the date hereof). Borrower shall pay any and all reasonable out-of-pocket costs and expenses incurred in connection with such Transfers (including Lender’s counsel fees and disbursements and any fees and expenses of the Rating Agencies). In addition, at all times (other than in connection with a Mezzanine Control Event), Guarantor (or a Qualified Equity Holder) must continue to Control Borrower, and own, directly or indirectly, at least a 51% legal and beneficial interest in Borrower.
(e) Notwithstanding anything to the contrary contained in this Section 5.2.10, Lender shall not unreasonably withhold its consent to a sale, assignment, or other transfer of the Property (or such Property remaining after any releases of Individual Properties pursuant to Section 2.5.2 hereof) and the assumption of the Loan by the applicable Transferee provided that (i) Lender receives prior written notice of such transfer, (ii) no Event of Default has occurred and is continuing both at the time such notice is given and as of the closing date of such transaction, (iii) no such sale, assignment or other transfer of the Property shall occur on or prior to the Permitted Prepayment Date (or prior to the date that is ninety (90) days following the Permitted Prepayment Date, if Lender delivers a written notice to Borrower on or prior to the Permitted Prepayment Date stating that a Securitization is imminently pending), and (iv) the following conditions precedent are satisfied (or waived in writing by L▇▇▇▇▇ or Servicer):
(i) Borrower shall pay Lender a transfer fee equal to $200,000.00 for each such Transfer resulting in the assumption of the Loan;
(ii) Borrower shall pay any and all reasonable out-of-pocket costs incurred in connection with such Transfer (including L▇▇▇▇▇’s outside counsel reasonable fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or Transferee’s Principals (directly or indirectly) must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to each Individual Property (or deliver evidence that they will engage a Qualified Manager to manage each Individual Property), which expertise shall be reasonably determined by L▇▇▇▇▇;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender; with the understanding that if Transferee and Transferee’s Principals would otherwise satisfy the Qualified Replacement Guarantor or Qualified Equity Holder Thresholds, as the case may be, then this clause (iv) shall be deemed satisfied;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner reasonably satisfactory to Lender in all respects, including by entering into an assumption agreement in form and substance reasonably satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened in writing against Transferee, Transferee’s Principals or Related Entities which is not acceptable to Lender in its reasonable discretion and Lender shall have performed searches and/or received other diligence such that Lender is in compliance with Lender’s then current “know your customer” requirements and shall have received Satisfactory Search Results for any owner of Transferee which, if a non-U.S. Person, will own a 10% or greater equity interest (directly or indirectly) in Borrower or, if a U.S. Person, will own a 20% or greater equity interest (directly or indirectly) in Borrower, after giving effect to such transfer;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not acceptable to Lender in its reasonable discretion;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by L▇▇▇▇▇, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements, covenants and legal opinions reasonably required by L▇▇▇▇▇;
(x) If required by Lender (and if a Securitization has occurred), Transferee shall be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a requalification, reduction, downgrade or withdrawal of the ratings in effect immediately prior to such Transfer assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or execute a replacement guaranty and environmental indemnity reasonably satisfactory to Lender; with the understanding that a substitute guarantor that qualifies as a Qualified Replacement Guarantor will be acceptable to Lender.
(xii) Borrower shall deliver, at its sole cost and expense, an endorsement (or equivalent) to each Title Insurance Policy insuring the Security Instruments, as reflected modified by the assumption agreement, as valid first liens on each Individual Property and naming the Transferee as owner of each Individual Property, which endorsement shall insure that each Individual Property shall not be subject to any additional exceptions or liens other than those contained in the most recent Additional Insolvency Opinion delivered Title Policies issued on the date hereof and the Permitted Encumbrances;
(xiii) Each Individual Property shall be managed by Qualified Manager pursuant to Lender)a Replacement Management Agreement; and
(xiv) If requested by L▇▇▇▇▇, Borrower or Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion which reflecting such Transfer satisfactory in form and substance to Lender.
(f) Notwithstanding any provision in this Section 5.2.10 to the contrary, direct or indirect limited partnership, membership or other equity interests, as applicable, in a Restricted Party may be relied upon by transferred without Lender’s consent and without application of the fee set forth in Section 5.2.10(e)(i): (i) among direct or indirect limited partners or members or other equity owners, as applicable, of a Restricted Party who are direct or indirect limited partners or members or other equity owners, as applicable, of a Restricted Party as of the Rating Agencies date of this Agreement (each a “Current Owner”), and their respective counsel, successors and assigns, with respect (ii) to the proposed transfer or sale, immediate family members (which Additional Insolvency Opinion shall be reasonably acceptable limited to Lender anda spouse, after a Securitizationparent, child and grandchild (each, an “Immediate Family Member”)), of any Current Owner or to trusts formed for the Rating Agencies;
(iii) at the time benefit of Immediate Family Members of such Transfer Current Owner for bona fide estate planning purposes (each, an “Additional Permitted Transfer”), provided each of the following conditions is satisfied: (A) no Event of Default has occurred and is continuing;
; (ivB) following such Transfer the property manager Lender has received Borrower’s notice of the Property must Additional Permitted Transfer no less than 30 days prior to the commencement of such transfer, if required by clause (J) below; (C) no Guarantor shall be a Qualified Manager;
released from any guaranty or indemnity agreement by virtue of the Additional Permitted Transfer; (vD) if, after giving effect to such Borrower shall be responsible for the costs and expenses of documenting the Additional Permitted Transfer; (E) Borrower shall reimburse Lender for all actual costs and expenses incurred by Lender in connection with the Additional Permitted Transfer, Sponsor does whether or not own at least 51% of consummated; (F) the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, Additional Permitted Transfer will not result in a downgradechange of Control of Borrower; (G) upon L▇▇▇▇▇’s request, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to furnish Lender its reasonable out-of-pocket expenses (including copies of any fees due to the Rating Agencies) documentation executed in connection with the Additional Permitted Transfer promptly after execution thereof; (H) the Additional Permitted Transfer shall not cause Borrower to violate any of the provisions of Section 4.1.30 hereof and, upon L▇▇▇▇▇’s request, Borrower shall deliver a written certification of such sale or conveyancecompliance to Lender; and
(viiI) intentionally omitted; (J) in connection with any Additional Permitted Transfer as a result of which Sponsor will not own at least 51% of that results in the equity interests in Borrower and controltransferee, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.i
Appears in 1 contract
Transfers. (a) Borrower acknowledges that L▇▇▇▇▇ has examined and relied on the experience of Borrower, Senior Borrower, and their respective stockholders, general partners, members, principals and (if Borrower or any Individual Senior Borrower is a trust) beneficial owners in owning and operating properties such as the Properties in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Collateral and Senior B▇▇▇▇▇▇▇’s ownership of the Properties as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Properties and the Collateral so as to ensure that, during the continuance of an Event of Default, Lender can recover the Debt by a sale of the Collateral.
(b) Without the prior written consent of LenderL▇▇▇▇▇, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Senior Borrower or Operating Lessee to any Restricted Party do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Collateral or any Individual Property or any direct part thereof or indirect any legal or beneficial interest therein, (ii) enter into any PACE Loan or (iiiii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (each of the following, a “Permitted Transfer”) (A) the Operating LeaseDistribution (and any Transfers effectuated in connection therewith as disclosed to Lender in writing prior to closing), (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) Permitted Equity Transfers; provided, that any waiver or amendment by Guarantor of the Room License Agreements9.8% ownership limitation set forth in the Guarantor’s declaration of trust shall require L▇▇▇▇▇’s prior written consent to the extent that both (I) an Ownership Change Limitation would reasonably be expected to exist immediately following a Transfer of the maximum interest in Guarantor permitted by such waiver or amendment, and (II) such Transfer would reasonably be expected to increase the percentage ownership of 5% shareholders of Borrower (including any “public group” as defined in Section 1.382-2T(f)(13) of the Treasury regulations treated as such) for purposes of determining whether there is an Ownership Change Limitation (provided that, for purposes of (II), Borrower shall be entitled to rely upon reasonably available information, including the Securities and Exchange Commission Schedules 13D and 13G of Guarantor and any information or representations obtained in connection with the granting of such a waiver or amendment, in determining whether any Transfer is reasonably expected to increase the percentage ownership of such 5% shareholders), (D) a Change of Control Event or any other exercise of remedies by Lender hereunder (including a foreclosure of the Pledge Agreement or an assignment in lieu thereof), (E) the exercise of remedies by Lender under the Loan Documents (including a foreclosure of the Pledge Agreement or an assignment or conveyance in lieu thereof), (F) the exercise of remedies by Senior Lender under the Loan Documents (including a foreclosure of the Mortgage or any Pledge Agreement (as defined in the Senior Loan Agreement) or an assignment or conveyance in lieu thereof), (G) a Condemnation, (H) the acquisition by Senior Borrower of fee title to any PILOT Property or Ground Lease Property in accordance with the terms and conditions of the applicable PILOT Lease or Ground Lease, this Agreement and the Senior Loan Documents, (I) Permitted TransfersEncumbrances, and (J) Transfers of Individual Properties in connection with a release pursuant to Section 2.5.2 of the Senior Loan Agreement.
(bc) Notwithstanding A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower or Senior Borrower agrees to sell the foregoingCollateral or one or more Individual Properties or any part thereof for a price to be paid in installments; (ii) an agreement by Senior Borrower leasing all or a substantial part of any Individual Property for other than actual occupancy by a space Tenant thereunder or a sale, assignment or other transfer of, or the grant of a sale security interest in, Senior Borrower’s right, title and interest in and to any Leases or conveyance by Borrower any Rents; (iii) if a Restricted Party is a corporation, any merger, Division, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger, Division or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the Property subject partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger, Division or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interest.
(d) If after giving effect to any Permitted Equity Transfer, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in Member are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in Member as of the Closing Date, Borrower shall, no less than ten (10) days prior to the lien effective date of any such Transfer, deliver to Lender an Additional Insolvency Opinion acceptable to Lender. To the extent that any Transfer will result in the transferee (either itself or collectively with its Affiliates) owning a 10% or greater equity interest (indirectly) in Borrower or Senior Borrower, L▇▇▇▇▇’s receipt of the Mortgage (but not any other mortgageSatisfactory Search Results, lien or other encumbrance (at Borrower’s cost and expense, shall be a condition precedent to such Transfer. For clarity, other than a Permitted REIT / TRS Transfer or a Permitted REIT Preferred Interest Transfer (which such Permitted REIT Preferred Interest Transfer shall require prior written notice to Lender), Borrower shall not cause, permit or suffer any Transfers of the direct interests in any Individual Senior Borrower, Subsidiary REIT, Borrower, Pledgor, Holdco or TRS without L▇▇▇▇▇’s prior written consent, which consent may be granted or withheld in Lender’s sole discretion.
(e) Any Permitted Encumbrances REIT / TRS Transfer shall be subject to, and Room License Agreements hereafter entered into in the ordinary course conditioned upon, satisfaction of operating the Property)) is permitted provided that the following conditions are satisfiedconditions:
(i) no No Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Defaultcontinuing;
(ii) Borrower shall provide Lender with written notice not later than ten (10) Business Days and not earlier than one hundred twenty (120) days prior to the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents date of the Transferee are reasonably acceptable to Lender and, after a Securitization, to proposed Transfer or the Rating Agencieseffective date of the applicable election described in Section 5.1.25 hereof;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender Borrower shall have consented delivered (i) an amendment to such sale the applicable Pledge Agreement in form and substance reasonably satisfactory to Lender or conveyancean additional pledge and security agreement granting Lender a second priority security interest (subject only to Senior Lender’s security interest, which consent shall not be unreasonably withheld;become first priority in the event Senior Lender’s security interest is terminated) in 100% of the common equity interests any new TRS Subsidiary or Subsidiary REIT, and (ii) upon request from Lender, an opinion letter from R▇▇▇ ▇▇▇▇▇ LLP or another counsel reasonably satisfactory to Lender opining as to the enforceability of such amendment(s) or pledge agreement(s) and other customary matters consistent with the corresponding opinions delivered on the Closing Date with respect to the Pledge Agreements, in form and substance reasonably acceptable to Lender; and
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion Borrower shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of pay all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledgereasonable, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket costs and expenses (including any fees due to the Rating Agencies) incurred in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen or the applicable election described in Section 5.1.25 hereof.
(15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (Af) Lender shall have not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon B▇▇▇▇▇▇▇’s or Senior Borrower’s Transfer without L▇▇▇▇▇’s or Senior L▇▇▇▇▇’s consent, as applicable. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany previous Transfer.
Appears in 1 contract
Transfers. (a) Borrower and each other Loan Party acknowledges that Lender has examined and relied on the experience of Borrower and each other Loan Party and its stockholders, general partners, members, principals and (if Borrower or such other Loan Party is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower and each other Loan Party acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party to, do any of the following (collectively, a “Transfer”): following: (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of USActive 30748472.10 -83- (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party (collectively, a “Transfer”), other than (A) pursuant to the Operating Lease, (B) pursuant to Lease or Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.205.1.20 hereof, (B) Permitted Encumbrances, (C) intentionally omitted (D) as otherwise permitted under this Section 5.2.10, without the prior written consent of Lender.
(c) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property for a price to be paid in installments; (ii) other than the Operating Lease, an agreement by Operating Lessee or Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space Tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s or Operating Lessee’s respective right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such general partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interests or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of Section 5.2.10(b) and (c) or any provisions of any of the Loan Documents to the contrary, the following transfers shall not be deemed to be a Transfer and Lender’s consent shall not be required in connection with:
(i) (A) a transfer by devise or descent or by operation of law upon the death of a member, partner or shareholder of a Restricted Party or a Restricted Party itself; (B) the Sale or Pledge, in one or a series of transactions, of not more than forty‑nine percent (49%) of the stock in a Restricted Party; provided, however, that no such transfers shall result in the change of voting control in the Restricted Party to any Person other than Guarantor, and as a condition to each such transfer, Lender shall receive not less than ten (10) days’ prior written notice of such proposed transfer, (C) the Room License AgreementsSale or Pledge, in one or a series of transactions, of not more than forty‑nine percent (49%) of the limited partnership interests or non‑managing membership interests (as the case may be) in a Restricted Party; provided, however, that no such transfers shall result in the change of voting control in the Restricted USActive 30748472.10 -84- Party to any Person other than Guarantor, and as a condition to each such transfer, Lender shall receive not less than ten (10) days prior written notice of such proposed transfer, or (D) Permitted Transfers.
(b) Notwithstanding the foregoingSale or Pledge, issuance or redemption of shares of common stock in any Restricted Party that is a sale publicly traded entity, provided such shares of common stock are listed on the New York Stock Exchange or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Defaultanother nationally recognized stock exchange;
(ii) (A) any transfer of any direct or indirect legal or beneficial interests in any Public Vehicle, including a Public Vehicle that exists on the Person to whom date hereof or a Public Vehicle which acquires a direct or indirect legal or beneficial interest in Borrower or any other Loan Party after the Property Closing Date in accordance with the terms of this Section 5.2.10, (B) the disposition, sale, issuance, transfer or redemption of shares or units of preferred stock in any Person, whether or not a Restricted Party, that is sold or conveyed identified on the organizational chart of Borrower attached hereto as Schedule V as a “real estate investment trust” (the a “TransfereeBorrower REIT”) satisfies under Section 856, et seq. of the requirements Code; and (C) the cancellation, surrender, disposition, issuance, sale, grant, transfer or pledge of the operating partnership units of Guarantor or any other operating partnership that owns indirect interests in Borrower that is a Special Purpose Entity publicly traded entity, provided such units are listed on the New York Stock Exchange or another nationally recognized stock exchange (an “OPU Transfer”); provided that (1) no OPU Transfer shall be to a Prohibited Person, (2) in the event any OPU Transfer results in any Person and its Affiliates owning in excess of ten percent (10%) of the direct or indirect ownership interest in Borrower or Operating Lessee or Guarantor, Borrower shall provide to Lender, not less than thirty (30) days prior to such OPU Transfer, the name and identity of each proposed transferee, together with the names of the Person(s) controlling such transferee, the social security number or employee identification number of such transferee and the Person(s) controlling such transferee, and such transferee’s and controlling Person(s)’ home address or principal place of business, and home or business telephone number, (3) Borrower and Operating Lessee shall deliver, or cause to be delivered to Lender any contribution agreement, amendment of the organizational documents of the Transferee are Guarantor or other material agreement or documentation in connection with such OPU Transfer, each of which shall be in form and substance reasonably acceptable to Lender along with any additional documentation as may be reasonably requested by Lender; and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitizationintentionally omitted; provided, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, that with respect to the Transferee and its applicable affiliatesall Transfers set forth in Section 5.2.10(d)(i) through (iii) above, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v1) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% (x) any Person Controlling, under the Control of the equity interests in Borrower or under common Control with Guarantor shall Control each Loan Party and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ixy) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than fifty-one percent (51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii%) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership legal and beneficial interest in each Loan Party shall be owned, in the aggregate for each such entity, by Guarantor or Chatham Lodging Trust, (2) such transferee and its principals are not an Embargoed Person and the representations set forth in Sections 4.1.9 and 4.1.35 hereof shall continue to be true and correct after giving effect to any such Transfer; (3) such Transfer shall be at Borrower’s sole cost and expense; (4) if after giving effect to any such Transfer, more than forty-nine percent (49%) in the aggregate of direct interests in Borrower shall be transferred to a any Restricted Party is owned by any Person individually or together with and its Affiliates not owning at least that owned less than forty-nine percent (49% %) direct interest in such USActive 30748472.10 -85- Restricted Party as of the Closing Date, Borrower shall, no less than five (5) Business Days prior to the effective date of any such Transfer, deliver to Lender an Additional Non-Consolidation Opinion reasonably acceptable to Lender and the Approved Rating Agencies; (5) to the extent any transferee shall own twenty percent (20%) or more of the direct or indirect ownership interests in Borrower immediately prior to following such Transfer (provided such transferee owned less than twenty percent (20%) of the direct or indirect ownership interests in Borrower as reflected of the Closing Date), Borrower shall deliver, (and Borrower shall be responsible for any reasonable out-of-pocket costs and expenses in connection therewith), customary searches reasonably requested by Lender in writing (including without limitation credit, judgment, lien, litigation, bankruptcy, criminal and watch list) reasonably acceptable to Lender with respect to such transferee, (6) for so long as the most recent Additional Insolvency Opinion delivered Loan shall remain outstanding, none of Borrower or Operating Lessee shall issue preferred equity interests (except as otherwise permitted pursuant to Lenderthe Loan Documents). In the event any Transfer shall result a change to the organizational chart attached hereto as Schedule V, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, updated organizational chart within ten (10) Business Days of such Transfer.
(e) No Transfer of the Rating Agencies Property and their respective counsel, successors and assigns, with respect assumption of the Loan shall occur in any event prior to the proposed transfer first (1st) anniversary of the Closing Date. Otherwise, Lender may consent in Lender’s sole discretion to a one (1) time Transfer of the Property or salethe legal or beneficial direct or indirect ownership interests therein or in Borrower and Operating Lessee and an assumption of the entire Loan, which Additional Insolvency Opinion consent shall not be reasonably acceptable to unreasonably withheld, provided that Lender and, after a Securitization, the Rating Agencies;
receives sixty (iii60) at the time days’ prior written notice of such Transfer and no Event of Default has occurred and is continuing, and provided, further, that the following additional requirements are satisfied:
(i) Borrower shall pay Lender a transfer fee equal to a quarter of one percent (0.25%) of the outstanding principal balance of the Loan at the time of such transfer;
(ii) Borrower shall pay any and all reasonable out-of-pocket costs incurred in connection with such Transfer (including, without limitation, Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and, if a Securitization has occurred, the fees and out-of-pocket expenses of the Approved Rating Agencies pursuant to clause (xi) below);
(iii) The proposed transferee (the “Transferee”) or Transferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Property, which expertise shall be reasonably determined by Lender;
(iv) following such Transfer the property manager Transferee and Transferee’s Principals shall, as of the Property must be a Qualified Managerdate of such transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender;
(v) ifTransferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been the subject of any Bankruptcy Action within seven (7) years prior to the date of the proposed Transfer;
(vi) With respect to a Transfer of the Property, Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or any Related Entities which, in each case, is not reasonably acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) With respect to any Transfer of the Property, Transferee must be able to satisfy all representations and covenants in Section 4.1.30 and with respect to any Transfer under this Section 5.2.10(e) (A) Borrower shall, after giving effect to such Transfer continue to be a Special Purpose Entity and comply with Section 4.1.30 hereof and (B) Borrower, Transferee and Transferee’s Principals shall comply with Sections 4.1.9, 4.1.35, 5.1.23 and 5.2.9 hereof. Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Default or Event of Default shall otherwise occur as a result of such Transfer;
(x) Transferee shall deliver (A) all organizational documentation reasonably requested by Lender, Sponsor does not own at least 51% which shall be reasonably satisfactory to Lender and, following a Securitization, satisfactory to the Approved Rating Agencies and (B) all certificates, agreements and legal opinions reasonably required by Lender;
(xi) If required by Lender after a Securitization, Transferee shall be approved by the Approved Rating Agencies, which approval shall take the form of a Rating Agency Confirmation with respect to such assumption or Transfer;
(xii) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the equity interests liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or execute a replacement guaranty and environmental indemnity reasonably satisfactory to Lender and delivered an Additional Insolvency Opinion covering the replacement guarantor, provided, Lender’s consent shall not be unreasonably withheld, conditioned or delayed if such replacement guarantor shall be a Qualified Guarantor (provided, that with respect to clause (v) in Borrower and control Borrowerthe definition of Qualified Guarantor, the Rating Agencies Transferee shall have confirmed that such Transfer, in and of itself, will not result in be deemed to be a downgrade, qualification or withdrawal of the then current ratings assigned to the SecuritiesLoan Party);
(vixiii) Borrower shall paydeliver, or cause to be paidat its sole cost and expense, to Lender its reasonable out-of-pocket expenses (including any fees due an endorsement to the Rating AgenciesTitle Insurance Policy, as modified by the assumption agreement, as a valid first lien on the Property and naming the Transferee as owner of the Property, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Property USActive 30748472.10 -87- shall not be subject to any additional exceptions or liens other than those contained in the Title Policy issued on the date hereof and the Permitted Encumbrances;
(xiv) in connection with such sale The Property shall be managed by Qualified Manager pursuant to a Replacement Management Agreement and licensed, flagged and branded by Franchisor pursuant to the Franchise Agreement or conveyanceby a Qualified Franchisor pursuant to a Replacement Franchise Agreement;
(xv) Reserved; and
(viixvi) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion reflecting such Transfer satisfactory in connection with any form and substance to Lender. Immediately upon a Transfer as a result to such Transferee and the satisfaction of which Sponsor will not own at least 51% all of the equity interests in Borrower and controlabove requirements, directly or indirectly, the named Borrower, Borrower each other Loan Party and Guarantor herein shall give or cause to be given written notice to Lender of released from all liability under this Agreement, the proposed Transfer not later than fifteen (15) days prior theretoNote, which notice each Mortgage and the other Loan Documents accruing after such Transfer. The foregoing release shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth effective upon the date the Transfer is expected of such Transfer, but Lender agrees to be effective and provide written evidence thereof reasonably requested by Borrower.
(Af) Lender shall have consented not be required to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee demonstrate any actual impairment of 1% its security or any increased risk of the then outstanding principal amount of the Loan.default hereunder in
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower, Mortgage Borrower and its stockholders, general partners, members, principals and (if Mortgage Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Mortgage Borrower’s ownership of the Property as a means of maintaining the value of the Property for repayment of the Debt and the performance of the other obligations of Borrower under the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the other obligations of Borrower under the Loan Documents, Lender can recover the Debt by a sale of the Collateral.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or the Collateral or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (B) Permitted Transfers and (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower upon satisfaction of the Property subject to the lien Transfer Criteria, Permitted Conditional Transfers. Notwithstanding anything contained in this Section 5.2.10(b) or in Section 5.2.10(d) hereof, no Transfer of the any direct ownership interest in Borrower or Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyancepermitted.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Mortgage Borrower agrees to sell the Property or any part thereof or Borrower agrees to sell the Collateral or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Mortgage Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Mortgage Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions are satisfied:creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(id) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverExcept as otherwise permitted under the definition of Permitted Transfers and Permitted Conditional Transfers and notwithstanding the provisions of this Section 5.2.10, Lender’s consent shall not be required ifin connection with one or a series of Transfers, of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such Transfer shall result in the change of Control in a Restricted Party, and as a condition to each such Transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed Transfer. If after giving effect to the any such Transfer, Sponsor owns not more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than 51% forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the equity interests in Closing Date, Borrower and controlsshall, directly or indirectly, Borrower;
no less than thirty (ii30) if as a result days prior to the effective date of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Transfer, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, and the Rating Agencies;
(iii) . In addition, at all times, the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property REIT must be a Qualified Manager;
(v) ifcontinue to Control Borrower, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Mortgage Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in Guarantor and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and controlown, directly or indirectly, at least a seventy-five percent (75%) legal and beneficial interest in Borrower, Mortgage Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen and Guarantor.
(15e) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and [Intentionally Omitted].
(Af) Lender shall have not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany previous Transfer.
Appears in 1 contract
Sources: Mezzanine Loan Agreement (Global Income Trust, Inc.)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.11, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the following conditions are satisfied:creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof. 103
(id) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided howeverNotwithstanding the provisions of this Section 5.2.11, Lender’s consent shall not be required ifin connection with one or a series of Transfers, of not more than forty-nine percent (49%) of the stock, the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such Transfer shall result in the change of Control in a Restricted Party, and as a condition to each such Transfer, Lender shall receive not less than thirty (30) days prior notice of such proposed Transfer. If after giving effect to the any such Transfer, Sponsor owns not more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than 51% forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the equity interests in Closing Date, Borrower and controlsshall, directly or indirectly, Borrower;
no less than thirty (ii30) if as a result days prior to the effective date of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Transfer, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, and the Rating Agencies;. In addition, at all times, (a) Guarantor must continue to Control, and own, directly or indirectly, in the aggregate, at least a 51% legal and beneficial interest in, Borrower, and (b) Acadia Realty Trust must continue to Control, and own, directly or indirectly, at least a 20% legal and beneficial interest in, each of Guarantor and any Affiliated Manager.
(iiie) at No consent to any assumption of the time Loan shall occur on or before the date that is twelve (12) Payment Dates after the Completion of the Improvements. Thereafter, Lender’s consent to a Transfer of the Property and assumption of the Loan shall not be unreasonably withheld provided that Lender receives sixty (60) days prior written notice of such Transfer and no Event of Default has occurred and is continuing, and further provided that the following additional requirements are satisfied for all Transfers other than those described in subsection (d) above:
(i) Borrower shall pay Lender at the time of such Transfer a transfer fee equal to one half of one percent (0.5%) of the outstanding principal balance of the Loan for the first Transfer and one percent (1.0%) of the outstanding principal balance of the Loan for each subsequent Transfer;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(viii) Borrower shall pay, or cause to be paid, to Lender its pay any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs incurred in connection with such sale Transfer (including, without limitation, Lender’s counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Transferee”) or conveyanceTransferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Property, which expertise shall be reasonably determined by Lender;
(iv) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate Net Worth and Liquidity reasonably acceptable to Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, 104 voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not reasonably acceptable to Lender;
(viii) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) Transferee and Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 4.1.35, 5.1.46 and 5.2.10 of this Agreement, no Default or Event of Default shall otherwise occur as a result of such Transfer, and Transferee and Transferee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and (B) all certificates, agreements and covenants reasonably required by Lender;
(x) Transferee shall be approved by the Rating Agencies selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such Transfer will not result in a requalification, reduction, downgrade or withdrawal of the ratings in effect immediately prior to such assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion reflecting such Transfer satisfactory in form and substance to Lender;
(xii) Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty of Completion, the Guaranty of Recourse Carveouts and the Environmental Indemnity executed by Guarantor or execute replacement guaranties and environmental indemnity reasonably satisfactory to Lender;
(xiii) Borrower shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policy, as modified by the assumption agreement, as a valid first lien on the Property and naming the Transferee as owner of the Property, which endorsement shall insure that, as of the date of the 105 recording of the assumption agreement, the Property shall not be subject to any additional exceptions or liens other than those contained in the Title Policy issued on the date hereof and the Permitted Encumbrances; and
(viixiv) in connection with any The Property shall be managed by a Qualified Manager pursuant to a Replacement Management Agreement. Immediately upon a Transfer as a result to such Transferee and the satisfaction of which Sponsor will not own at least 51% all of the equity interests in above requirements, the named Borrower and controlGuarantor herein shall be released from all liability under this Agreement, directly or indirectlythe Note, Borrower, Borrower the Mortgage and the other Loan Documents accruing after such Transfer. The foregoing release shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth effective upon the date the Transfer is expected of such Transfer, but Lender agrees to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanprovide written evidence thereof reasonably requested by Borrower.
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and that of its members and principals and (if Borrower is a trust) beneficial owners in owning the Collateral in agreeing to make the Loan, and will continue to rely on Borrower's ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Collateral so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Collateral.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 or in connection with the release of a Release Property subject to and in accordance with, as applicable, Section 2.5 hereof2.6 or Section 8.1(c) hereof (and, as applicable, Section 2.6, 6.4(d) or 8.1(c) of the Mortgage Loan Agreement), Borrower shall not, and nor shall not it permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, sublet, grant a security interest in, grant options with respect to, or otherwise transfer transfer, exchange or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) any of the Collateral, any of the Senior Mezzanine Collateral, any Individual Property or any direct part thereof or indirect any legal or beneficial interest therein or, except as may be expressly permitted under and in accordance with Section 5.1.22 hereof, any Lease of any part thereof or any legal or beneficial interest therein, or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lesseeor, other than as contemplated by the Loan, the Other Mezzanine Loans or the Corporate Loan, a Pledge of an interest in any Restricted Party or (Aiii) except for Permitted Encumbrances, mortgage, hypothecate or otherwise encumber the leasehold interest in any Operating LeaseLease (collectively, (B) a "Transfer"), other than pursuant to Leases of space in the Improvements and Non-Material Leases to tenants in accordance with the provisions of Section 5.1.205.1.22.
(c) A Transfer shall include, but not be limited to, (Ci) an installment sales agreement wherein Borrower, Senior Mezzanine Borrower, Mortgage Borrower or Maryland Owner agrees to sell the Collateral, any of the Senior Mezzanine Collateral or an Individual Property, as applicable, or any part thereof, for a price to be paid in installments; (ii) an agreement by Mortgage Borrower or Maryland Owner leasing all or a substantial part of an Individual Property for other than actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Mortgage Borrower's or Maryland Owner's right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation's stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of this Section 5.2.10, the following Transfers shall not be deemed to be a Transfer; provided that any such Transfer is a complete conveyance of the related interest and not a Pledge (other than as expressly set forth below), encumbrance or other Transfer of such interest
(i) the Room License AgreementsTransfer, in one or a series of transactions, of not more than forty-nine percent (49%) of the direct or indirect interests in a Restricted Party; provided, however, that (A) no such Transfers shall result in the change of control in the Restricted Party, and (DB) Permitted Transfers.as a condition to each such Transfer, (I) Lender shall receive not less than thirty (30) days' prior notice of such proposed Transfer and (II) at all times, Carlyle and/or one or more Affiliates of Carlyle shall continue to own, directly or indirectly, at least a fifty-one percent (51%) interest in Borrower, Senior Mezzanine Borrower, Mortgage Borrower, Maryland Owner, Master Tenant and Operator;
(bii) Notwithstanding the foregoingPledge of any direct or indirect interests in any Operator, a sale Master Tenant or conveyance by Borrower any direct or indirect equity holder in the Operator and/or in HCR Properties, LLC in favor of Corporate Loan Lender as security for the Property Corporate Loan as same may have been refinanced subject to the lien provisions of Section 5.2.12, and any Transfer which occurs as the result of the exercise of remedies by Corporate Loan Lender in accordance with the Corporate Loan or the holders of any indebtedness used to refinance the Corporate Loan, subject to the provisions of Section 5.2.12; provided, however, that it shall be a condition to a Transfer to any Person pursuant to a foreclosure on such Pledge or other sale or assignment thereof that (A) Mortgage Borrower and Maryland Owner shall have obtained and delivered to Lender prior written confirmation from the applicable Rating Agencies that such Transfer shall not cause a downgrade, withdrawal or qualification of the ratings of any Securities or any class thereof issued upon the Securitization of the Mortgage Loan, (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(iB) no Event of Default shall then be continuing, (C) none of Lender, Senior Mezzanine Lender or Mortgage Lender shall have commenced an Enforcement Action under the Loan Documents, the applicable Senior Mezzanine Loan Documents or the Mortgage Loan Documents, (D) no Bankruptcy Action shall have occurred with respect to Borrower, Senior Mezzanine Borrower, Mortgage Borrower or Maryland Owner, (E) no event shall have occurred or would reasonably be expected to occur as a result thereof, which would be reasonably expected to have, or has, a Material Adverse Effect, and (F) the new Operator shall be continuing and such sale or conveyance a Qualified Operator approved by Lender, which approval shall not result in an Event of Default;
(ii) the Person to whom the Property is sold be unreasonably withheld, conditioned or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender delayed; and, after a Securitization, to the Rating Agencies;
(iii) any Transfer which occurs as the result of the exercise of remedies by Lender or any Other Mezzanine Lender in accordance with the Loan or any Other Mezzanine Loan. With respect to each of the Transfers set forth in clauses (i) through (iii) above, (A) if after giving effect to any such sale Transfer and all prior Transfers, more than forty-nine percent (49%) in the aggregate of the direct or conveyance occurs prior indirect interests of Borrower are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) of the direct or indirect interests in Borrower as of the Closing Date, it shall be an additional condition to such Transfer that Lender receives an Additional Insolvency Opinion reasonably acceptable to Lender, (B) in the event that such Transfer renders an assumption in the True Lease Opinion untrue, it shall be an additional condition to such Transfer that Lender receives an Additional True Lease Opinion regarding such Transfer reasonably acceptable to Lender, and (C) if a Securitization, Lender Securitization of the Mortgage Loan shall have consented occurred, in the event that such Transfer (I) is of more than forty-nine percent (49%) in the aggregate of the direct or indirect interests in Borrower or (II) results in a Person other than Carlyle controlling HCR Healthcare, LLC or any direct or indirect subsidiary thereof, it shall be an additional condition to such sale Transfer that (1) Borrower shall have caused Mortgage Borrower and Maryland Owner to have obtained and delivered to Lender prior written confirmation from the applicable Rating Agencies that such Transfer will not cause a downgrade, withdrawal or conveyancequalification of the then-current ratings of the Securities or any class thereof, and shall have obtained each Designated Mezzanine Lender's consent thereto, which consent shall not be unreasonably withheld;
, and, (iv2) Lender has received an Additional Insolvency Opinion which may be relied upon by Lenderif one or more Operators are replaced as a result of such Transfer, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion that each such replacement Operator shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
Operator. Notwithstanding any provision hereof to the contrary, this Section 5.2.10 shall not prohibit or restrict (viii) the Transferee pays to Lender a loan assumption fee any Transfer of 1% any interest in Guarantor or any Transfer of the then outstanding principal amount any interests in or assets of the Loan;
any Affiliate of Guarantor (viiiother than any direct or indirect subsidiary of HCR Properties, LLC or HCR Healthcare, LLC), (ii) ifany Transfer of any equity interests in any Restricted Party (other than Borrower, Maryland Owner, Mezzanine Borrower, Master Tenant, or Operator), or (iii) any merger or consolidation of any Restricted Party (other than Borrower, Maryland Owner, Mezzanine Borrower, Master Tenant or Operator), so long as, after giving effect to such Transfer, Sponsor does not own at least 51merger or consolidation, (A) Carlyle and/or one or more Affiliates of Carlyle shall continue to have a Controlling Equity Interest in Guarantor, Manor Care, HCR Properties, LLC and HCR Healthcare, LLC, and (B) 100% of the equity interests in Borrower and control of each of HCR VII Properties, LLC, HCR II Healthcare, LLC, Borrower, Maryland Owner, Mezzanine Borrower, Principal, Master Tenant and Operator are owned by HCR Properties, LLC or HCR Healthcare, LLC, and Guarantor controls Manor Care, HCR Properties, LLC and HCR Healthcare, LLC. For the Rating Agencies have confirmed that such sale purposes of this paragraph, a "Controlling Equity Interest" in Guarantor or conveyance, in and a subsidiary of itself, will not result in a downgrade, qualification or withdrawal Guarantor means (1) if the equity securities of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of neither Guarantor nor any direct or indirect parent of Guarantor are traded on a national securities exchange, ownership, directly or indirectly, of at least fifty-one percent (51%) of the equity and voting interests of Guarantor (or such direct or indirect parent) or such subsidiary, as applicable, and (2) if the equity securities of either Guarantor or any direct or indirect parent of Guarantor are traded on a national securities exchange, ownership, directly or indirectly, of at least 30% of the equity and voting interests of Guarantor (or such direct or indirect parent) or such subsidiary, as applicable, and the possession of the power to direct and cause the direction of the voting rights associated with such interests, provided that no Person (other than Carlyle or an Affiliate of Carlyle) then holds a greater percentage of the equity or voting interests in Borrower Guarantor (or such direct or indirect parent) or such subsidiary, as applicable. For purposes of this paragraph "control" shall mean the direct or indirect power to direct and cause the direction of the management and policies of a Person whether through ownership of voting securities, beneficial interest, by contract or otherwise. For the avoidance of doubt, no prohibited Transfer of equity interests in any direct or indirect subsidiary of HCR Properties, LLC or HCR Healthcare, LLC shall be deemed to have occurred solely by virtue of a Transfer that is otherwise permitted hereunder of direct or indirect equity interests in HCR Properties, LLC or HCR Healthcare, LLC. Nothing contained herein shall be deemed to prohibit Corporate Loan Lender from syndicating or otherwise transferring its rights under the Corporate Loan. In addition, nothing contained herein shall be deemed to prohibit additional borrowings or the refinancing of all or a portion of the Corporate Loan (without increasing the principal amount thereof other than as permitted under Section 5.2.12); provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs that, at Lender's request, Corporate Loan Lender, each Other Mezzanine Lender, Mortgage Lender and Lender shall have entered into an intercreditor agreement with Lender in form and substance reasonably acceptable to Lender, Mortgage Lender and each Other Mezzanine Lender prior to a Securitization, Lender and, if a Securitization shall have consented occurred, acceptable to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Mortgage Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loaneach Designated Mezzanine Lender.
Appears in 1 contract
Sources: Loan Agreement (Hcp, Inc.)
Transfers. 2.1 Prohibited Transfers Each Stockholder agrees not to Transfer any Stock owned by it, except (ai) Without for Transfers of Stock to Santera, (ii) Tekelec and/or its Affiliates shall have the prior written consent right to transfer Stock to any direct or indirect wholly owned subsidiary of LenderTekelec (provided the same executes an Instrument of Accession as provided by Section 2.2) and/or pledge, hypothecate, grant a security interest in and except otherwise encumber Stock in connection with the incurrence by Tekelec or its Affiliates of indebtedness for borrowed money and nothing herein shall prohibit any Transfer of the Stock owned by Tekelec or its Affiliates in connection with any sale of all or substantially all of the stock or assets of Tekelec or any acquisition of Tekelec and/or its Affiliates by merger or otherwise, (iii) to the extent otherwise set forth agreed to by the holders of not less than sixty-five percent (65%) of the Stock, calculated on a fully converted basis, (iv) any Stockholder may Transfer some or all of the Stock owned by such Stockholder to another Stockholder (provided that such Stockholder is a party to this Agreement and the Escrow Agreement), including any Transfers to Santera contemplated by the Escrow Agreement (provided that the Representative, in this Section 5.2.10 and Section 2.5 hereofits capacity as record owner, Borrower shall not, and shall may not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do Transfer any of the following shares of Stock registered in its name and held for the benefit of certain stockholders of Santera pursuant to the terms and subject to the conditions contained in the Escrow Agreement except as otherwise permitted under Article IV of the Escrow Agreement), (collectivelyv) any time after the Termination Date, so long as approved in advance by the Board of Directors (such approval not to be unreasonably withheld), any Transfer of Stock owned by a “Transfer”): Stockholder to stockholders, partners or members of such Stockholder upon the liquidation of such Stockholder or a distribution to the stockholders, partners or members of such Stockholder, (ivi) sellupon the death of any Stockholder, conveysuch Stock may be transferred to one, mortgagebut only one, grantbeneficiary or, bargainif there is more than one beneficiary, encumber, pledge, assign, grant options with respect then such Stock shall be transferred to, or otherwise transfer or dispose of (voluntarily or involuntarilyand remain in, such Stockholder's estate, by operation of law or otherwise(vii) as otherwise expressly provided in this Agreement. Notwithstanding the foregoing or anything else contained herein to the contrary, without the prior written consent of Tekelec, no Stockholder may Transfer any shares of Stock (including, without limitation, any such Transfers otherwise permitted by this Section 2.2 or as contemplated by Sections 2.3 or 2.4) in the event that such proposed Transfer would cause the transactions contemplated by the Merger Agreement to fail to qualify as a tax-free transaction under Section 351 of the Code. Any purported Transfer in violation of this Agreement shall be invalid and void, and whether or not for consideration or of record) the Property or any direct or indirect interest therein, or (ii) permit a Sale or Pledge of a direct or indirect interest in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising registered in Santera's or to be performed under this Agreement, the Mortgage and the any other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale Person's books or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses otherwise recognized for any purpose (including any fees due for the purpose of determining voting rights or entitlement to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in dividends or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lenderdistributions), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.
Appears in 1 contract
Sources: Stockholders' Agreement (Tekelec)
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Properties in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Properties as a means of maintaining the value of the Properties as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Properties so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Properties.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee Restricted Party to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property Properties or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.205.1.21, (C) the Room License Agreements, and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Transfers and Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyanceDebt.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Properties or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of any Individual Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of this Section 5.2.10, the following shall not be deemed to be a Transfer:
(i) A Public Sale; provided, that (A) if after giving effect to any such Public Sale, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in Borrower a Restricted Party is permitted provided owned by any Person and its Affiliates that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not owned less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
forty-nine percent (ii49%) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests interest in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% such Restricted Party as of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender andand the Approved Rating Agencies and (B) no Individual Borrower or Principal shall fail to be a Special Purpose Entity by reason of such Public Sale.
(ii) The Sale (but not a Pledge nor the issuance of preferred equity interests), in one or a series of transactions, of the direct or indirect equity interests in Borrower and or direct or indirect interests in any Restricted Party; provided, that, (A) after giving effect to such Sale, Guarantor (x) shall own not less than fifty and one tenths percent (50.1%) of the economic and direct or indirect legal and beneficial interests in Borrower (on an unencumbered and look-through basis) and (y) Control Borrower, (B) any Excluded Entity or Qualified Transferee (x) shall own not less than 50.1% of the economic and direct or indirect legal and beneficial interests in Guarantor (on an unencumbered and look through basis) and (y) Control Guarantor, (C) upon the written request of Lender, Borrower shall deliver to Lender notice of each sale described in this Section 5.2.10(d)(ii) not less than ten (10) days following such request, (D) no Sale or Pledge of any direct interest in any Borrower shall be permitted and (E) no Individual Borrower shall fail to be a Special Purpose Entity by reason of such Sale. If after giving effect to any such Sale, more than forty-nine percent (49%) in the aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion reasonably acceptable to Lender and the Approved Rating Agencies. Notwithstanding anything to the contrary contained in this Agreement (including Section 5.2.10), no notice to, or consent of, or deliveries to, or payments to Lender shall be required in connection with any Sale or Pledge (including as a result of a merger or issuance of shares) of direct or indirect interests in any Excluded Entity.
(e) No Transfer and assumption of the Loan shall occur during the period that is forty-five (45) days prior to and sixty (60) days after a Securitization. Otherwise a one (1) time (a) Transfer of a greater than fifty-one percent (51%) legal or beneficial direct or indirect interest in the Properties or Borrower and/or (b) a transfer of Control of Borrower in each case, accompanied by an assumption of the Rating Agencies;
entire Loan, shall be permitted without Lender’s consent (iiia “Permitted Assumption”), provided that Lender receives thirty (30) at the time days prior written notice of such Transfer Permitted Assumption and no Event of Default has occurred and is continuingcontinuing at the time such Permitted Assumption is consummated, and further provided that the following additional requirements are satisfied:
(i) Borrower shall pay Lender a transfer fee equal to $500,000.00;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(viii) Borrower shall pay, or cause to be paid, to Lender its pay any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs incurred in connection with such sale Permitted Assumption (including, without limitation, Lender’s reasonable counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Approved Rating Agencies pursuant to clause (vi) below);
(iii) The proposed transferee (the “Transferee”) must be at least fifty-one percent (51%) owned (directly or conveyanceindirectly) and Controlled by a Qualified Transferee or Qualified Public Company;
(iv) With respect to a Transfer of the Property, if applicable, the Transferee entity to which the Property is conveyed shall assume all of the obligations of Borrower under the Loan Documents in a manner reasonably satisfactory to Lender, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(v) Transferee and Transferee’s principals that Control Transferee (“Related Entities”) must be able to satisfy all the representations and covenants set forth in Sections 4.1.35, 5.1.25 and 5.2.9 of this Agreement, and Transferee and the Related Entities shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and, following a Securitization, satisfactory to the Approved Rating Agencies (B) all certificates, agreements necessary to evidence the Permitted Assumption and an Additional Insolvency Opinion and a due authority, execution and enforceability opinion reasonably acceptable to Lender;
(vi) Intentionally omitted;
(vii) Borrower or Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion reflecting such Transfer reasonably satisfactory in form and substance to Lender;
(viii) There shall be no material litigation relating to the creditworthiness of Transferee or any Related Entities or any regulatory action pending against Transferee or any Related Entities in each case, which could be reasonably expected to have a material adverse effect on the financial condition of such Transferee or Related Entity;
(ix) One (1) or more Replacement Guarantors shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty executed by Guarantor or execute a Replacement Guaranty substantially similar to the Guaranty; provided that the Replacement Guarantor shall not be subject to an ongoing net worth covenant;
(x) If the Permitted Assumption is accomplished by deed or conveyance of the Properties rather than by assignment of all of Guarantor’s or a Restricted Party’s interests in Borrower, Borrower shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policies, as modified by the assumption agreement, as a valid first lien on the Properties and naming the Transferee as owner of the Properties, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Properties shall not be subject to any additional exceptions or liens other than those contained in the relevant Title Insurance Policy issued on the date hereof and any other Permitted Encumbrances; and
(viixi) in connection with any Each Individual Property shall be managed by a Qualified Manager pursuant to a Management Agreement. Immediately upon a Transfer as a result to such Transferee and the satisfaction of which Sponsor will not own at least 51% all of the equity interests in above requirements, the named Borrower and controlGuarantor herein shall be released from all liability under this Agreement, directly the Note, the Mortgage and the other Loan Documents for acts or indirectlyomissions occurring after such Transfer. The foregoing release shall be effective upon the date such Permitted Assumption is consummated, but Lender agrees to provide written evidence thereof reasonably requested by Borrower.
(f) In the case of a Transfer that is a Public Sale pursuant to Section 5.2.10(d)(i) or a Permitted Assumption pursuant to Section 5.2.10(e) Guarantor shall be released from the Guaranty for all liability arising after the date of such Transfer if one of the following conditions are met: (i) a Replacement Guarantor shall execute a replacement guaranty in form and substance the same as the Guaranty covering all liability arising after the date of such Transfer (but not any which may have accrued prior thereto) (a “Replacement Guaranty”); provided, that such Replacement Guarantor shall not be subject to an ongoing Net Worth covenant; or (ii) Borrower shall give or cause to be given written notice delivers to Lender of the proposed Transfer not later than fifteen Cash/LC Collateral.
(15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (Ag) Lender shall have not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany previous Transfer.
Appears in 1 contract
Transfers. (a) Without Unless such action is permitted by the prior written consent provisions of Lender, and except to the extent otherwise set forth in this Section 5.2.10 5.2.10, each of Borrower and Section 2.5 hereof, Borrower shall not, and shall Maryland Owner agrees that it will not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): (i) sell, assign, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, transfer or otherwise dispose of its legal or beneficial interests in any Individual Property or any part thereof other than pursuant to space leases permitted under, and entered into in accordance with, Section 5.1.20 hereof, (ii) permit any owner, directly or indirectly, of an ownership interest in any Individual Property, to transfer or dispose of such interest, whether by transfer of stock or other interest in a Restricted Party, or otherwise, (iii) incur Indebtedness (other than the Indebtedness permitted pursuant to the terms of this Agreement), (iv) mortgage, hypothecate or otherwise encumber or grant a security interest in any Individual Property or any part thereof, (v) sell, assign, convey, transfer, mortgage, encumber, grant a security interest in, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect ownership interest thereinin any Restricted Party, or permit any owner of an interest in a Restricted Party to do the same, or (iivi) permit file a Sale declaration of condominium with respect to any Individual Property (any of the foregoing transactions, a “Transfer”). For avoidance of doubt, except as -84- expressly set forth in Section 5.2.10(d) below, no assumption of all or Pledge any portion of a direct the Loan shall be permitted without Lender’s prior written consent, such consent to be granted or indirect interest withheld in Borrower or Operating Lessee, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, Lender’s sole and (D) Permitted Transfersabsolute discretion.
(b) Notwithstanding the foregoingFor purposes hereof, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but “Transfer” shall not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
include (i) no Event of Default shall have occurred and be continuing and such any public issuance, sale or conveyance shall not result transfer of non-controlling interests in an Event of Default;
Inland Western Retail Real Estate Trust, Inc., (ii) transfer by devise or descent or by operation of law upon the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements death of a Special Purpose Entity and the organizational documents member or partner of the Transferee are reasonably acceptable to Lender andBorrower or Maryland Owner, after a Securitization, to the Rating Agencies;
or (iii) if such sale the transfer of direct or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the indirect equity interests in Borrower and control BorrowerInland Equity Investors, LLC or in Inland Equity, LLC by the Rating Agencies have confirmed that such sale current holders thereof or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counselsuccessors, successors transferees and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.
Appears in 1 contract
Sources: Loan Agreement (Inland Western Retail Real Estate Trust Inc)
Transfers. (a) Each Borrower acknowledges that Lender has examined and relied on the experience of each Borrower and its members, stockholders, general partners, members, principals and (if any Borrower is a trust) beneficial owners, as applicable, owning and operating properties such as the Properties in agreeing to make the Loan, and will continue to rely on Borrowers’ ownership of the Properties as a means of maintaining the value of the Properties as security for repayment of the Debt and the performance of the Other Obligations. Each Borrower acknowledges that Lender has a valid interest in maintaining the value of the Properties so as to ensure that, should Borrowers default in the repayment of the Debt or the performance of the Other Obligations contained in the Loan Documents, Lender can recover the Debt by a sale of one or more of the Properties.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 5.2.10, no Borrower shall, and Section 2.5 hereof, no Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or Properties owned by such Borrower or any direct part thereof or indirect any legal or beneficial interest therein, or (ii) permit a Sale or Pledge of a direct or indirect any interest in Borrower any Restricted Party or Operating Lessee(iii) incur Indebtedness (other than the Indebtedness permitted pursuant to the terms of this Agreement) (any of the foregoing transactions, a “Transfer”), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.205.1.20 hereof, (B) the Loan Documents and (C) the Mezzanine Loan and the granting of security interests pursuant to the Mezzanine Loan Documents.
(c) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein any Borrower agrees to sell the Property or Properties owned by such Borrower, or any part thereof, for a price to be paid in installments; (ii) an agreement by any Borrower leasing all or substantially all of the Property or Properties owned by such Borrower for other than actual occupancy by a space tenant thereunder, or a sale, assignment or other transfer of, or the grant of a security interest in, such Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of this Section 5.2.10, the following transfers shall not be deemed to be a Transfer, and so long as all of the applicable conditions contained therein shall have been fulfilled, such transfer may occur without consent from Lender: (i) transfers of shares in ▇▇▇▇ Credit Property Trust I, Inc. or ▇▇▇▇ Credit Property Trust III, Inc., (ii) transfers of ownership interests in any Restricted Party and ownership interests in any member, partner or shareholder of any Restricted Party to any Affiliate or subsidiary of a Restricted Party, provided that, at all times, ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇ Holdings Corporation, ▇▇▇▇ Credit Property Trust I, Inc. or ▇▇▇▇ Credit Property Trust III, Inc. continues to Control the Restricted Party provided after giving effect to such transfer, the Person receiving such interest and each Restricted Party who shall exist following such transfer, shall be able to satisfy the requirements and representations set forth in Section 4.1.35, and Section 5.2.10(f), (v), (vii) and (viii), mutatis, mutandis and if the individual or individuals who have direct or indirect Control over the Person to whom such interests are to be transferred is someone other than ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, such individuals shall be reasonably acceptable to Lender, or (iii) the pledge of equity interests in Borrowers and Principal in connection with the Mezzanine Loan, and the exercise of any rights or remedies of Mezzanine Lender (including foreclosure and an assignment in lieu of foreclosure), as applicable, in accordance with and subject to the terms of the Intercreditor Agreement. It shall be a condition of any such transfer specified in the foregoing clause (ii) that Lender shall have received a written confirmation from the parties to the Management Agreement that provides that all Properties, which are the subject of any such transfer or which are directly or indirectly owned by the Restricted Party and/or any member, partner or shareholder of any Restricted Party whose interest were the subject of any such transfer, shall have been removed from the application of such Management Agreement. Lender agrees that, in connection with any transfer contemplated by the foregoing clause (ii), Borrower shall have the right to substitute a replacement guarantor for Guarantor under the Loan Documents, provided that the replacement guarantor (A) shall have a net worth at least equal to $150,000,000 and liquidity at least equal to $5,000,000, as shown on a current balance sheet of such replacement guarantor, (B) shall have made the representations and met the requirements set forth in Sections 4.1.1, 4.1.2, 4.1.3, 4.1.11, 4.1.18, 4.1.37, 4.1.35 and Section 5.2.10(f)(v), (vii) and (viii), which apply to Guarantor, such that the replacement guarantor shall be deemed to make such representations and fulfill such requirements mutatis, mutandis, (C) shall not have been a party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the Room License Agreementsbenefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of such transfer, (D) shall not be involved in any pending or threatened material litigation or regulatory action which is not reasonably acceptable to Lender, and (DE) Permitted Transfersshall not have defaulted under its obligations with respect to any Indebtedness in a manner which is not reasonably acceptable to Lender. Upon the execution and delivery of any documents necessary to consummate such substitution, the original Guarantor shall be released from all liability and obligations under the Guaranty, the Environmental Indemnity and the other Loan Documents with respect to any acts or omissions after any such replacement guarantor shall have executed and delivered a replacement Guaranty and fulfilled all of the conditions set forth in the immediately preceding sentence.
(be) Notwithstanding Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the foregoingDebt immediately due and payable upon a Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, a sale or conveyance by Borrower whether or not Lender has consented to any previous Transfer.
(f) No consent to any assumption of the Property subject to Loan shall occur on or before the lien end of the Mortgage Lockout Period. Thereafter, Lender’s consent to a one (but 1) time Transfer of all of the Properties (which may be to more than one (1) transferee, provided each such transferee shall either be Transferee’s Sponsor or an Affiliate of Transferee’s Sponsor and assumption of the Loan shall not any other mortgagebe unreasonably withheld provided that Lender receives not less than sixty (60) days prior written notice of such Transfer and no Default has occurred and is continuing, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted further provided that the following conditions additional requirements are satisfied:
(i) no Event Borrowers shall pay Lender a transfer fee equal to one percent (1%) of Default shall have occurred and be continuing and the Outstanding Principal Balance at the time of such sale or conveyance shall not result in an Event of DefaultTransfer;
(ii) the Person to whom the Property is sold or conveyed Borrowers shall pay any and all reasonable out-of-pocket costs incurred in connection with such Transfer (the “Transferee”) satisfies the requirements of a Special Purpose Entity including, without limitation, Lender’s reasonable counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the organizational documents fees and expenses of the Transferee are reasonably acceptable Rating Agencies pursuant to Lender and, after a Securitization, to the Rating Agenciesclause (x) below);
(iii) if such sale The Persons comprising the proposed transferees (collectively, the “Transferee”), Transferee’s Principal or conveyance occurs prior Transferee’s Sponsor must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to a Securitization, Lender shall have consented to such sale or conveyanceeach of the Properties, which consent expertise shall not be unreasonably withheldreasonably determined by Lender;
(iv) Lender has received Transferee, Transferee’s principal and the owner of equity interests in Transferee who shall replace the original Mezzanine Borrower as contemplated in clause (xv) below (“Replacement Mezzanine Borrower”) shall, as of the date of such transfer, have an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies aggregate net worth and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be liquidity reasonably acceptable to Lender or, after a Securitization, the Rating Agenciesand Mezzanine Lender;
(v) Transferee, Replacement Mezzanine Borrower, Transferee’s or Replacement Mezzanine Borrower’s Principal and all other entities which may be owned or Controlled directly or indirectly by Transferee’s or Replacement Mezzanine Borrower’s Principal (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the Transferee shall execute an assumptionbenefit of creditors or taken advantage of any insolvency act, effective as or any act for the benefit of debtors within seven (7) years prior to the date of transfer, of the proposed Transfer;
(vi) Transferee shall assume (subject to Section 9.4) all of the obligations of Borrowers under the Borrower thereafter arising Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender, and a Person (who shall be an Affiliate or direct or indirect equity owner of Transferee; which is herein called “Transferee’s Sponsor”) shall agree at all times (x) to Control each of Transferee, Transferee’s general partner or managing member, if any (“Transferee’s Principal”), Replacement Mezzanine Borrower’s general partner or managing member, if any (“Replacement Mezzanine Borrower’s Principal”), and (y) to own, directly or indirectly, at least a 0.5% beneficial interest in Transferee’s Principal and Replacement Mezzanine Borrower’s Principal, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be performed no material litigation or regulatory action pending or threatened against Transferee, Replacement Mezzanine Borrower, Transferee’s Principal, Replacement Mezzanine Borrower’s Principal or Related Entities which is not reasonably acceptable to Lender;
(viii) Transferee, Replacement Mezzanine Borrower, Transferee’s Principal, Replacement Mezzanine Borrower’s Principal and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) Transferee, Replacement Mezzanine Borrower, Transferee’s Principal and Replacement Mezzanine Borrower’s Principal must be able to satisfy all the representations and covenants set forth in Sections 4.1.30, 4.1.35, 5.1.23 and 5.2.9 of this Agreement, the Mortgage no Default or Event of Default shall otherwise occur as a result of such Transfer, and the other Loan DocumentsTransferee, subjectReplacement Mezzanine Borrower, howeverTransferee’s Principal and Replacement Mezzanine Borrower’s Principal shall deliver (A) all organizational documentation reasonably requested by Lender, to the provisions of Section 9.3 hereof and upon such assumption, Borrower which shall be released from reasonably satisfactory to Lender and (B) all liabilities certificates, agreements and covenants reasonably required by Lender provided that such certificates, agreements and covenants shall not increase the obligations of Borrowers under the Loan Documents or decrease the rights of Borrowers under the Loan Documents;
(vix) following such sale or conveyance the property manager of the Property must If required by Lender, Transferee shall be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, approved by the Rating Agencies have confirmed selected by Lender, which approval, if required by Lender, shall take the form of a confirmation in writing from such Rating Agencies to the effect that such sale or conveyance, in and of itself, Transfer will not result in a downgraderequalification, qualification reduction, downgrade or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer assumption or transfer for the Securities or any class thereof issued in connection with a Securitization which are then outstanding;
(xi) Borrowers or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)Transferee, Borrower at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by reflecting such Transfer satisfactory in form and substance to Lender;
(xii) Prior to any release of Guarantor, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer one (1) or sale, which Additional Insolvency Opinion shall be more substitute guarantors reasonably acceptable to Lender and, after shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or execute a Securitization, the Rating Agenciesreplacement guaranty and environmental indemnity reasonably satisfactory to Lender;
(iiixiii) Borrowers shall deliver, at Borrowers’ sole cost and expense, an endorsement to the time Title Insurance Policies, which endorsement shall insure the Lien of such Transfer no Event the Mortgages as modified by the assumption agreement, as a valid first lien on each of Default has occurred the Properties, shall name the Transferee as owner of the Properties, and is continuingshall insure that, as of the date of the recording of the assumption agreement, the Properties shall not be subject to any additional exceptions or liens other than those contained in the applicable Title Insurance Policies issued on the date hereof and the Permitted Encumbrances;
(ivxiv) following such Transfer the property manager of the Property must The Properties shall be a managed by one or more Qualified ManagerManagers pursuant to one or more Replacement Management Agreements;
(vxv) ifReplacement Mezzanine Borrower shall assume the obligations of Mezzanine Borrower under the existing Mezzanine Loan Agreement, after giving effect Mezzanine Note, and other Mezzanine Loan Documents, except that the pledge agreement securing the Mezzanine Loan shall be modified to such Transfer, Sponsor does not own at least 51% grant a pledge of the equity interests in Borrower and control Transferee;
(xvi) The organizational documents of Transferee, Replacement Mezzanine Borrower, Transferee’s Principal and Replacement Mezzanine Borrower’s Principal, shall include provisions which shall cause each of them to be a SPE, and shall otherwise be in form and substance reasonably satisfactory to Lender;
(xvii) Immediately upon a Transfer to such Transferee and the Rating Agencies satisfaction of all of the above requirements, the named Borrowers and Guarantor herein shall have confirmed that be released from all liability under this Agreement, the Note, the Mortgages and the other Loan Documents accruing after such Transfer (provided such release of the Guarantor shall be conditioned on one (1) or more substitute guarantors reasonably acceptable to Lender having assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity or entering into new comparable documentation, in each case in accordance with the provisions set forth in the immediately preceding sub-clause(xii)). The foregoing release shall be effective upon the date of such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned but Lender agrees to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyanceprovide written evidence thereof reasonably requested by Borrowers; and
(viixviii) Mezzanine Lender shall have permitted its Mezzanine Loan to have been assigned and assumed in connection with any the Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of implemented by this Section 5.2.10(f), with the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.effe
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Pledged Collateral as a means of maintaining the value of the Pledged Collateral as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Pledged Collateral so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Pledged Collateral.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property Property, the Pledged Collateral or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower any Restricted Party or any assignment of the Operating LesseeLease in violation of the terms of the Mortgage Loan Agreement, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.205.1.20 and (B) Permitted Transfers, and (C) the Room License Agreements, and (D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of provisions set forth in Section 5.2.10(d), (e) and (f) hereof, any Transfer permitted (without obtaining Mortgage Lender’s consent) under the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Pledged Collateral or any part thereof, Mezzanine A Borrower agrees to sell the Mezzanine A Pledged Collateral or any part thereof or Mortgage Borrower agrees to sell the Property, or any part thereof, in each case for a pledgeprice to be paid in installments; (ii) an agreement by Mortgage Borrower or Operating Lessee leasing all or a substantial part of the Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Mortgage Borrower’s or Operating Lessee’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(d) Notwithstanding the provisions of this Section 5.2.10, the following shall not be deemed a Transfer: the Sale or Pledge in one or a series of transactions, of the direct or indirect equity interests in Borrower or direct or indirect interests in any Restricted Party (excluding the direct interests in Mortgage Borrower is permitted provided that the following conditions are satisfied:
or any Mezzanine Borrower); provided, that, (i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfersuch Sale or Pledge, Sponsor owns (A) BREP VI and/or Strategic (I) shall own not less than fifty-one percent (51% %) of the equity direct or indirect legal, economic and beneficial interests in Borrower Borrower, in the aggregate and controls(II) shall Control Borrower, directly or indirectly, Borrower;
(iiB) if as a result of any such Transfer or series of Transfers more (I) Strategic shall own not less than 4936.3747% of the direct or indirect ownership legal, economic and beneficial interest in Borrower and (II) an Approved BREP Transferee shall own the remaining direct or indirect, legal, economic and beneficial interests in Borrower (ii) Lender shall receive notice of any Sale or Pledge described in this Section 5.2.10(d) not less than thirty (30) days following the consummation thereof (but the failure to deliver any such notice shall not cause the applicable Sale or Pledge to be a Transfer and shall not constitute an Event of Default unless such failure continues for ten (10) Business Days following notice of such failure from Lender), (iii) no Sale or Pledge of any direct interest in any Mortgage Borrower, Operating Lessee or Mezzanine A Borrower shall be permitted, (iv) for so long as the Loan shall remain outstanding, no such Sale or Pledge of any direct interests in Borrower shall be transferred to permitted, (v) for so long as the Mortgage Loan or any Mezzanine Loan shall remain outstanding, (A) no pledge or other encumbrance of any direct interests in any Restricted Pledge Party shall be permitted (other than the pledges securing the Mortgage Loan, the Loan or the Mezzanine A Loan), and except that a Person individually or together with its Affiliates not owning at least 49% pledge of the direct or indirect ownership interests in Borrower immediately prior the most upper-tier Restricted Pledge Party shall be permitted if such pledge directly or indirectly secures indebtedness that is also directly or indirectly secured by substantial assets other than the Property and the IP Collateral; and (B) no Restricted Pledge Party shall issue preferred equity that has the characteristics of mezzanine debt (such as a fixed maturity date, regular payments of interest, a fixed rate of return and rights of the equity holder to demand repayment of its investment), and (vi) none of Borrower, Mezzanine A Borrower, Mortgage Borrower, Operating Lessee, Operating Lessee GP or North Beach Company shall fail to be a Special Purpose Entity by reason of such Transfer Sale or Pledge. If after giving effect to any such Sale or Pledge, more than forty-nine percent (or as reflected 49%) in the most recent Additional Insolvency Opinion delivered to Lender)aggregate of direct or indirect interests in a Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Restricted Party as of the Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender andand the Approved Rating Agencies. Notwithstanding anything to the contrary contained in this Agreement, no notice to, or consent of, Lender shall be required in connection with any Sale or Pledge of direct or indirect interests in any Excluded Entity.
(e) No Transfer of the Property and assumption of the Loan shall occur during the period that is sixty (60) days prior to and sixty (60) days after a Securitization, . A Transfer of the Rating Agencies;
Property or 100% of the legal or beneficial ownership interests therein or in Borrower and assumption of the entire Loan not otherwise permitted by Section 5.2.10(d) to a Qualified Transferee shall be permitted (iiia “Permitted Assumption”); provided that Lender receives thirty (30) at the time days prior written notice of such Transfer and no Event of Default has occurred and is continuingcontinuing at the time such Permitted Assumption is consummated, and further provided that the following additional requirements are satisfied:
(i) Borrower shall pay Lender a transfer fee equal to Two Hundred Thousand and No/100 Dollars ($200,000.00).
(ii) Borrower shall pay any and all reasonable out-of-pocket costs incurred in connection with such Permitted Assumption (including, without limitation, Lender’s reasonable counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Approved Rating Agencies pursuant to clause (x) below);
(iii) Intentionally Omitted;
(iv) following such Transfer the property manager of the Property must be a Qualified ManagerIntentionally Omitted;
(v) ifQualified Transferee and Qualified Transferee’s Principals must not have been the subject of any Bankruptcy Action within seven (7) years prior to the date of the proposed Transfer;
(vi) Qualified Transferee shall assume all of the obligations of Mortgage Borrower under the Mortgage Loan Documents in a manner satisfactory to Lender in all respects, after giving effect including, without limitation, by entering into an assumption agreement in form and substance satisfactory to such TransferLender;
(vii) All of the entities which own interests in the Qualified Transferee similar to the interests in Mortgage Borrower owned by Borrower (the “Mezzanine Entities”): (A) shall assume the Loan and all the agreements of Borrower under the Loan Documents (and without limiting the foregoing, Sponsor does not own all of the ownership interests in the Qualified Transferee, as applicable, all payments thereon and all proceeds thereof shall be pledged to Lender on terms no less favorable than the pledge of the Pledged Collateral under the Pledge Agreement), which shall be evidenced by new loan documents substantially similar (in form and substance) to the Loan Documents and otherwise reasonably acceptable to Lender in order to properly reflect the new ownership structure and the pledge of the interests thereunder, (B) shall each be a bankruptcy-remote Special Purpose Entity, and (C) shall otherwise have a legal, financial and ownership structure that is (1) substantially the same as Borrower, or (2) at least 51as favorable to Lender, as determined by Lender in its reasonable discretion, as the legal, financial and ownership structure of Borrower;
(viii) There shall be delivered to Lender opinions of counsel, in form, substance and from counsel satisfactory to Lender as Lender requests on the following matters, subject to exceptions and conditions customarily contained in such opinions: (A) an “Additional Insolvency Opinion” with respect to the Mezzanine Entities and such of their Affiliates as shall be requested by Lender, (B) such other bankruptcy related opinions as shall be requested by Lender, including an opinion that no fraudulent conveyance or preference results from the transfer of the Property and the assumption by the Mezzanine Entities of the obligations of Borrower of the Loan Documents, and all related transactions, and (C) all certificates, agreements necessary to evidence the Permitted Assumption and a due authority, execution and enforceability opinion reasonably acceptable to Lender;
(ix) There shall be no material litigation relating to the creditworthiness or reputation of Qualified Transferee, Qualified Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Qualified Transferee’s Principals (“Related Entities”), or regulatory action pending or threatened against Qualified Transferee, Qualified Transferee’s Principals or any Related Entity;
(x) Intentionally omitted;
(xi) Qualified Transferee must be able to satisfy all representations and covenants in Section 4.1.30 hereof (or in the event of a transfer of 100% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall paycontinue to satisfy all representations and covenants in Section 4.1.30), and in all cases Qualified Transferee and Qualified Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Default or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer Event of Default shall otherwise occur as a result of which Sponsor will not own at least 51% of the equity interests in Borrower such Transfer, and control, directly or indirectly, Borrower, Borrower Qualified Transferee shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and, following a Securitization, satisfactory to the Approved Rating Agencies and (B) all certificates, agreements, covenants and legal opinions reasonably required by Lender;
(xii) If required by Lender, following or in connection with a Securitization, Qualified Transferee shall have consented be approved by the Approved Rating Agencies, which approval, if required by Lender, shall take the form of a Rating Agency Confirmation with respect to such Permitted Assumption; provided that a written waiver or acknowledgment from one or more of the Approved Rating Agencies indicating its decision not to review the Permitted Assumption for which the Rating Agency Confirmation is sought shall be deemed to satisfy the required for the Rating Agency Confirmation with respect to such Approved Rating Agency.
(xiii) Guarantor shall be released from the Guaranty for all liability accruing after the date of a Transfer, (A) so long as one (1) or more substitute guarantors is a Qualified Transferee (excluding clause (iv) or (v) of the definition thereof) or is otherwise acceptable to Lender in its sole discretion and such substitute guarantor has assumed all of the liabilities and obligations of Guarantor under the Guaranty or has executed a replacement guaranty satisfactory to Lender in its sole discretion, in each case covering all liability accruing after the date of such assumption or execution; provided, that such assignment and assumption of the Guaranty and/or replacement guaranty delivered hereunder shall provide that the Debt shall be fully recourse to such replacement guarantor if Borrower fails to obtain Lender’s prior written consent to any Sale or Pledge of the Pledged Collateral or a Transfer of the ownership interests in any Restricted Party as required by Section 5.2.10 hereof and excluding Permitted Transfers, Permitted Encumbrances and any other Lien expressly permitted under the Loan Documents and (B) Borrower shall pay has delivered to Lender a loan assumption fee of 1% customary legal opinions relating to authorization and enforceability of the then outstanding principal amount additional guaranty contemplated above, substantially similar in form and substance to the opinions delivered to Lender on the Closing Date relating to the Guaranty, or otherwise in form and substance reasonably acceptable to Lender in its sole discretion, including, to the extent the Guarantor being released was included in the Insolvency Opinion delivered at closing, an Additional Insolvency Opinion with respect to any replacement guarantor.
(xiv) Borrower shall deliver, at its sole cost and expense, an endorsement to the UCC Title Insurance Policy, as modified by the assumption agreement, as a valid first lien on the Pledged Collateral and naming the Qualified Transferee as owner of the Loan.Pledged Collateral, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Pledged Collateral shall not be subject to any additional exceptions or liens other than those contained in the UCC Title Policy issued on the date hereof and the Permitted Encumbrances relating thereto;
(xv) Lender shall have approved the Qualified Transferee’s owner’s title insurance policy with respect to the Property, subject only to the Permitted Encumbrances;
(xvi) such Transfer has been approved or deemed approved under the Mortgage Loan Documents by Mortgage Lender and all conditions set forth in the Mortgage Loan Documents relating thereto have been satisfied as determined by Lender in its reasonable discretion and as if each reference therein to “Lender” were to mean Lender and not Mortgage Lender;
(xvii) The Property shall be managed by Qualified Manager pursuant to a Replacement Management Agreement;
(xviii) Borrower or Qualified Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion reflecting such Transfer satisfactory in form and substance to Lender; and
(xix) Borrower shall have obtained Lender’s prior written consent to such Permitted Assum
Appears in 1 contract
Sources: Mezzanine Loan Agreement (Strategic Hotels & Resorts, Inc)
Transfers. (a) Without Except as otherwise permitted by the provisions of this Agreement, Borrower will not, without the prior written consent of Lender, and except to (i) permit or suffer (by operation of law or otherwise) any sale, assignment, conveyance, transfer or other disposition of legal or equitable interest in all or any part of the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereofProperty (other than Permitted Encumbrances), Borrower shall not(ii) permit or suffer (by operation of law or otherwise) any sale, and shall not permit assignment, conveyance, transfer or other disposition of any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following Hotel Operator, (collectively, a “Transfer”): iii) permit or suffer (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise) any mortgage, and whether lien or not for consideration other encumbrance of all or any part of record) the Property or any direct or indirect interest therein(other than Permitted Encumbrances), or (iiiv) permit a Sale or Pledge suffer (by operation of law or otherwise) any pledge, hypothecation, creation of a security interest in or other encumbrance of any direct or indirect interest in Borrower or Operating Lessee, other than Hotel Operator (A) the Operating Leaseeach action described in clauses (i), (Bii), (iii) pursuant and (iv) of this subsection is a “Transfer”). Notwithstanding anything to Leases of space the contrary contained in this Agreement or in the Improvements to tenants in accordance with the provisions of Section 5.1.20other Loan Documents, (Ci) the Room License AgreementsTransfers of interests in Sponsor or in any Person having any direct or indirect legal or beneficial interest in Sponsor or (ii) a Transfer by Accor of its direct or indirect twenty-five percent (25%) interest in Borrower and Hotel Operator shall not be prohibited or restricted in any manner whatsoever, including by sale, merger, consolidation or otherwise and (Dshall not be subject to any notice, delivery, approval or consent requirements, including any requirement for an Additional Insolvency Opinion or any other requirement under Section 5.2.13(c) Permitted Transfershereof.
(b) Notwithstanding the foregoing, a A sale or conveyance by Borrower of all of the Property subject to the lien of the Mortgage (but not any other a mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)encumbrance) is permitted (and no transfer or assumption fee shall be payable in connection therewith) provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale a Permitted Owner owns not less than 51% of the direct or conveyance occurs prior to a Securitizationindirect equity interests in the Transferee and controls, Lender shall have consented to such sale directly or conveyanceindirectly, which consent shall not be unreasonably withheldthe Transferee;
(iv) Lender has received an additional nonconsolidation opinion (the “Additional Insolvency Opinion”) substantively similar to the Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender orand, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 9.4 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) unless otherwise approved in writing by Lender in its sole discretion, the entity which owns interests in the Transferee similar to the interests in Borrower owned by Sole Member shall have an ownership structure that is substantially the same as Borrower and the Sole Member;
(vii) there shall be delivered to Lender opinions of counsel, in form, substance and from counsel reasonably satisfactory to Lender and substantially similar to those heretofore delivered as Lender requests on the following matters, subject to exceptions and conditions customarily contained in such opinions: (1) such corporate and securities opinions as shall be reasonably requested by Lender, including without limitation, any and all opinions as shall have been delivered to Lender in connection with the making of the Loan, and (2) such other legal opinions as shall be reasonably requested by Lender;
(viii) if following such sale or conveyance conveyance, Manager will not be the property manager of the Property, then the property manager of the Property must be a Qualified Qualifying Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viiiix) if, if such sale or conveyance occurs after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrowera Securitization, the Rating Agencies shall have confirmed in writing that such sale or conveyance, in and of itself, conveyance will not result in a downgraderequalification, qualification reduction, downgrade or withdrawal of the ratings in effect immediately prior to such sale or conveyance for the Securities or any class thereof issued in connection with a Securitization which are then current ratings assigned to the Securitiesoutstanding; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(ix) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Event of Default has occurred and is continuing;
(iv) following such Transfer the property manager of the Property must be a Qualified Manager;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Properties in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Properties as a means of maintaining the value of the Properties as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Properties so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Properties.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the any Individual Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party (collectively, a “Transfer”), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 hereof; and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyanceEncumbrances.
(c) A Subject to subclauses (A) and (B) of Section 5.2.10(b), a Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein any Individual Borrower agrees to sell its Individual Property, or any part thereof, for a pledgeprice to be paid in installments; (ii) an agreement by any Individual Borrower leasing all or a substantial part of its Individual Property for other than actual occupancy by a space tenant thereunder, hypothecationor a sale, creation assignment or other transfer of, or the grant of a security interest in, its right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any direct general partner or indirect any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in Borrower is permitted provided that a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of this Section 5.2.10, the following conditions are satisfied:
transfers shall not be deemed to be a Transfer: (i) if such the pledge, sale or conveyance occurs prior transfer, in one or a series of transactions, of not more than forty-nine percent (49%) of the stock in a Restricted Party; provided, however, no such pledges, sales or transfers shall result in the change of control in the Restricted Party, and as a condition to a Securitizationeach such pledge, sale or transfer, Lender shall have consented to receive not less than ten (10) Business Days prior notice of such pledge, proposed sale or conveyancetransfer, which (ii) the pledge, sale or transfer, in one or a series of transactions, of not more than forty-nine percent (49%) of the limited partnership interests or non-managing or membership interests (as the case may be) in a Restricted Party; provided, however, no such pledges, sales or transfers shall result in the change of control in the Restricted Party, and as a condition to each such pledge, sale or transfer, Lender shall receive not less than ten (10) Business Days prior notice of such proposed pledge, sale or transfer, and (iii) the sale, transfer or issuance of not more than eighty-five percent (85%) of the beneficial ownership interests in Guarantor, provided that (A) such beneficial ownership interests are securities listed on the New York Stock Exchange or such other nationally-recognized stock exchange, (B) no such sales or transfers shall result in the change of control in Guarantor, and (C) if required by Lender, the delivery of a nonconsolidation opinion reflecting the proposed transfer satisfactory in form and substance to Lender, and provided, further, that the subsequent sale, transfer, exchange or trading of such securities shall not be deemed a Transfer.
(e) Lender’s consent to a one (1) time Transfer of the Properties shall not be unreasonably withheld; withheld provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
that Lender receives thirty (ii30) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately days prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time written notice of such Transfer and no Event of Default has occurred and is continuing, and further provided that the following additional requirements are satisfied:
(i) Borrower shall pay Lender a transfer fee equal to one-half of one percent (0.50%) of the outstanding principal balance of the Loan at the time of such Transfer;
(ii) Borrower shall pay any and all reasonable out-of-pocket costs incurred in connection with such Transfer (including, without limitation, Lender’s reasonable counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies pursuant to clause (x) below);
(iii) The proposed transferee (the “Assignee”) or Assignee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Properties, which expertise shall be reasonably determined by Lender;
(iv) following such Transfer the property manager Assignee and Assignee’s Principals shall, as of the Property must be a Qualified Managerdate of such Transfer, have an aggregate net worth and liquidity reasonably acceptable to Lender;
(v) ifAssignee and Assignee’s Principals and all other entities which, after giving effect to as of the date of such Transfer, Sponsor does will have any equity interest in Assignee and are owned or Controlled directly or indirectly by Assignee’s Principals (“Assignee Related Entities”) must not own at least 51% have been a debtor in any proceeding under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law within seven (7) years prior to the date of the equity interests proposed Transfer;
(vi) Assignee shall assume all of the obligations of Borrower under the Loan Documents in Borrower a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and control Borrowersubstance satisfactory to Lender;
(vii) There shall be no material litigation or regulatory action pending or threatened against Assignee, Assignee’s Principals or Assignee Related Entities which is not reasonably acceptable to Lender;
(viii) Assignee, Assignee’s Principals and Assignee Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(ix) Assignee and Assignee’s Principals must be able to satisfy all the Rating Agencies representations and covenants set forth in Sections 4.1.30 and 5.2.9 hereof, no Default or Event of Default shall have confirmed that otherwise occur as a result of such Transfer, in and of itselfAssignee and Assignee’s Principals shall deliver (A) all organizational documentation reasonably requested by Lender, will which shall be reasonably satisfactory to Lender and (B) all certificates, agreements and covenants reasonably required by Lender;
(x) If a Securitization shall have occurred, Lender shall have received written confirmation from the applicable Rating Agencies that such Transfer shall not result in a downgrade, withdrawal or qualification or withdrawal of the then current ratings assigned to of the SecuritiesSecurities or any class thereof;
(vixi) Borrower or Assignee, at its sole cost and expense, shall pay, or cause to be paid, deliver to Lender its reasonable out-of-pocket expenses an Additional Insolvency Opinion reflecting such Transfer satisfactory in form and substance to Lender;
(including xii) Prior to any fees due release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the Rating Agencies) in connection with such sale liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity executed by Guarantor or conveyanceexecute a replacement guaranty and environmental indemnity reasonably satisfactory to Lender; and
(viixiii) in connection with any Transfer Borrower shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policies, as modified by the assumption agreement, as a result of which Sponsor will not own at least 51% valid first lien on the Properties and naming the Assignee as owner of the equity interests Properties, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Properties shall not be subject to any additional exceptions or liens other than those contained in the relevant Title Insurance Policies issued on the date hereof and the Permitted Encumbrances relating thereto. Immediately upon a Transfer to such Assignee and the satisfaction of all of the above requirements, the named Borrower and controlGuarantor herein shall be released from all liability under this Agreement, directly or indirectlythe Note, Borrower, Borrower the Mortgages and the other Loan Documents accruing after such Transfer. The foregoing release shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth effective upon the date the Transfer is expected of such Transfer, but Lender agrees to be effective and provide written evidence thereof reasonably requested by Borrower.
(Af) Lender shall have not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanany previous Transfer.
Appears in 1 contract
Transfers. (a) Without Borrower acknowledges that Lender has examined and relied on the creditworthiness and experience of Borrower and its general partner, managing member, limited partners, members and beneficial owners, as applicable, in owning and operating properties such as the Property in agreeing to make the loan secured by the Mortgage, and that Lender will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt. Borrower shall not without Lender’s prior written consent of Lender, and except to the extent as otherwise set forth expressly provided in this Section 5.2.10 and Section 2.5 hereof, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): 5.2.10: (i) sell, assign, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, transfer or otherwise dispose of its legal or beneficial interests in the Property or any part thereof other than pursuant to Leases permitted under, and entered into in accordance with, Section 5.1.20 hereof, (ii) permit any owner, directly or indirectly, of an ownership interest the Property, to transfer or dispose of such interest, whether by transfer of stock or other interest in a Restricted Party, or otherwise, (iii) incur Indebtedness (other than the Indebtedness permitted pursuant to the terms of this Agreement), (iv) mortgage, hypothecate or otherwise encumber or grant a security interest in the Property or any part thereof, (v) sell, assign, convey, transfer, mortgage, encumber, grant a security interest in, or otherwise transfer or dispose of (voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct or indirect ownership interest thereinin any Restricted Party, or permit any Restricted Party that owns an interest in another Restricted Party to do the same, or (iivi) permit file a Sale or Pledge declaration of condominium with respect to the Property (any of the foregoing transactions, a direct or indirect interest in Borrower or Operating Lessee“Transfer”). Notwithstanding the foregoing, other than (A) the Operating Leasefor purposes hereof, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) a “Transfer” shall not include Permitted Transfers.
(b) Notwithstanding Section 5.2.10(a), at any time other than the foregoingperiod commencing thirty (30) days prior to a Securitization and ending thirty (30) days after a Securitization, Lender’s consent shall not be required in connection with one or a sale or conveyance by Borrower series of Transfers, of up to forty-nine percent (49%) of the stock, limited partnership interests or membership interests (as the case may be) in a Restricted Party; provided, however, no such Transfer shall result in the change of Control in such Restricted Party, and as a condition to each such Transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed Transfer. In addition, at all times, IREIT must continue to (i) Control the applicable Restricted Party, and (ii) own, directly or indirectly, not less than fifty-one percent (51%) of the legal and beneficial interest in the applicable Restricted Party.
(c) Notwithstanding Section 5.2.10(a), at any time other than the period commencing thirty (30) days prior to a Securitization and ending thirty (30) days after a Securitization, Lender shall not withhold its consent to a Transfer of the entire Property subject or all of the outstanding ownership interests in Borrower in a single transaction to one newly-formed Special Purpose Entity which shall be a wholly-owned subsidiary of IREIT (“Permitted Affiliate Transferee”) which shall be approved by Lender in its reasonable discretion (“Permitted Affiliate Transfer”), provided (1) no Event of Default shall have occurred and be continuing, (2) the creditworthiness of IREIT, as applicable, has not deteriorated, in the sole discretion of Lender, from the Closing Date to the lien date of the Mortgage proposed Transfer, and (3) Borrower shall have paid all reasonable and customary third party expenses (including reasonable attorneys’ fees and disbursements) actually incurred by Lender in connection with such Transfer (but not any other mortgageassumption or processing fee).
(d) Notwithstanding Section 5.2.10(a), lien or other encumbrance (at any time after other than during the Permitted Encumbrances period that is thirty (30) days prior to and Room License Agreements hereafter entered into in thirty (30) days after a Securitization, Lender shall not withhold its consent to a Transfer of the ordinary course Property and assumption of operating the Property)Loan, provided that Lender receives thirty (30) is permitted days’ prior written notice of such Transfer and further provided that the following conditions additional requirements are satisfied:
(i) the proposed transferee of the Property shall be a Special Purpose Entity (the “Transferee”) which at the time of such transfer will be in compliance with, and must be able to satisfy all of, the representations, warranties and covenants contained in Section 4.1.30, Section 4.1.35, Section 5.1.23 and Section 5.2.9 and which shall have assumed in writing (subject to the terms of Section 9.3 hereof) and agreed to comply with all the terms, covenants and conditions set forth in this Loan Agreement and the other Loan Documents, expressly including, without limitation the representations, warranties and covenants contained in Section 4.1.30, Section 4.1.35, Section 5.1.1 and Section 5.1.23 hereof;
(ii) Borrower shall deliver confirmation in writing from the Rating Agencies that such proposed Transfer will not cause a downgrading, withdrawal, reduction or qualification of the ratings in effect immediately prior to such Transfer for the Securities, or any class thereof, issued in connection with a Securitization which are then outstanding;
(iii) Transferee and Transferee’s Principals shall, as of the date of such transfer, have an aggregate net worth and liquidity not worse than the net worth and liquidity of Borrower and its Principals as of the date hereof or an aggregate net worth and liquidity otherwise reasonably acceptable to Lender;
(iv) Transferee or Transferee’s Principals must have demonstrated expertise in owning and operating properties similar in location, size, class and operation to the Property, which expertise shall be reasonably determined by Lender;
(v) Transferee, Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Transferee’s Principals (“Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(vi) Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to Lender in all respects, including, without limitation, by entering into an assumption agreement in form and substance reasonably satisfactory to Lender;
(vii) there shall be no material litigation or regulatory action pending or threatened against Transferee, Transferee’s Principals or Related Entities which is not reasonably acceptable to Lender;
(viii) the Property shall be managed by a Qualified Manager pursuant to a Replacement Management Agreement;
(ix) Transferee, Transferee’s Principals and Related Entities shall not have defaulted under its or their obligations with respect to any other Indebtedness in a manner which is not reasonably acceptable to Lender;
(x) no Event of Default shall have occurred and be continuing and such sale no Default or conveyance shall not result in an Event of DefaultDefault shall otherwise occur as a result of such Transfer;
(iixi) Borrower shall deliver, at its sole cost and expense, an endorsement to each existing Title Insurance Policy insuring the Person to whom related Mortgage, as modified by the assumption agreement, as a valid first lien on the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents naming Transferee as owner of the Transferee are reasonably acceptable to Lender andfee estate (or leasehold estate, after a Securitization, to as applicable) of the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyanceProperty, which consent endorsement shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lenderinsure that, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all the recording of the obligations of assumption agreement, such Property shall not be subject to any additional exceptions or liens other than those contained in such Title Insurance Policy issued on the Borrower thereafter arising or to be performed under this Agreement, the Mortgage date hereof and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan DocumentsPermitted Encumbrances relating thereto;
(vixii) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the LoanIntentionally omitted;
(viiixiii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, BorrowerIntentionally omitted;
(iixiv) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with Transferee, at its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender)sole cost and expense, Borrower shall deliver to Lender an Additional Insolvency Opinion opinions regarding existence, authority and enforceability, which opinions may be relied upon by Lender, the Rating Agencies and their respective counsel, successors agents and assigns, representatives with respect to the proposed transfer or saletransaction;
(xv) Transferee and Transferee’s Principals shall deliver (1) all organizational documentation reasonably requested by Lender, which Additional Insolvency Opinion shall be reasonably acceptable to Lender andLender, after a Securitizationand (2) all certificates, the Rating Agenciesagreements and covenants reasonably required by Lender;
(iiixvi) at Prior to any release of Guarantor, one (1) or more substitute guarantors reasonably acceptable to Lender shall have assumed all of the time liabilities and obligations of such Transfer no Event of Default has occurred Guarantor under the Guaranty and is continuingEnvironmental Indemnity (if any) executed by Guarantor or execute a replacement guaranty and environmental indemnity (if applicable) reasonably satisfactory to Lender;
(ivxvii) following such Transfer the property manager Borrower shall have paid an assumption fee equal to one-half of one percent (0.5%) of the Property must then outstanding principal balance of the Loan in connection with the first such Transfer, and an assumption fee equal to one percent (1.0%) of the then outstanding principal balance of the Loan in connection with each subsequent Transfer, provided, however, no such assumption fee shall be a Qualified Managerpayable if the Transferee is wholly owned by an Identified Affiliate; and;
(v) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vixviii) Borrower shall pay, pay (or cause to be paid, to Lender its ) any and all reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) costs actually incurred by Lender in connection with such sale Transfer (including, without limitation, Lender’s reasonable counsel fees and disbursements) and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Rating Agencies (if any) pursuant to clause (ii) above.
(e) Notwithstanding Section 5.2.10(a), at any time after other than during the period that is thirty (30) days prior to and thirty (30) days after a Securitization, Lender shall not withhold its consent to a Transfer of all of the outstanding ownership interests in Borrower in a single transaction to an Identified Affiliate, provided that Lender receives thirty (30) days’ prior written notice of such Transfer and further provided that the following additional requirements are satisfied:
(i) Borrower shall deliver confirmation in writing from the Rating Agencies that such proposed Transfer will not cause a downgrading, withdrawal, reduction or conveyancequalification of the ratings in effect immediately prior to such Transfer for the Securities, or any class thereof, issued in connection with a Securitization which are then outstanding;
(ii) The Identified Affiliate shall, as of the date of such transfer, have an aggregate net worth and liquidity not worse than the net worth and liquidity of IREIT as of the date hereof or an aggregate net worth and liquidity otherwise reasonably acceptable to Lender;
(iii) The Identified Affiliate and all other entities which may be owned or Controlled directly or indirectly by the Identified Affiliate (“Identified Affiliate Related Entities”) must not have been party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer;
(iv) there shall be no material litigation or regulatory action pending or threatened against the Identified Affiliate or Identified Affiliate Related Entities which is not reasonably acceptable to Lender;
(v) the Property shall continue to be managed by Manager or be managed by a Qualified Manager pursuant to a Replacement Management Agreement;
(vi) no Event of Default shall have occurred and be continuing and no Default or Event of Default shall otherwise occur as a result of such Transfer;
(vii) intentionally omitted;
(viii) The Identified Affiliate, at its sole cost and expense, shall deliver opinions regarding existence, authority and enforceability, which opinions may be relied upon by Lender, the Rating Agencies and their respective counsel, agents and representatives with respect to the proposed transaction;
(ix) The Identified Affiliate shall deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably acceptable to Lender, and (B) all certificates, agreements and covenants reasonably required by Lender;
(x) Prior to any release of Guarantor, the Identified Affiliate shall have assumed all of the liabilities and obligations of Guarantor under the Guaranty and Environmental Indemnity (if any) executed by Guarantor or execute a replacement guaranty and environmental indemnity (if applicable) reasonably satisfactory to Lender; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (Bxi) Borrower shall pay all of Lender’s reasonable and customary third-party expenses (including reasonable attorneys’ fees and disbursements) actually incurred by Lender in connection with such Transfer and a processing fee equal to $5,000 and all expenses of the Rating Agencies (if any) pursuant to clause (i) above.
(f) Notwithstanding Section 5.2.10(a), Lender’s consent shall not be required with respect to the merger of IREIT with any other Identified Affiliate; provided that (i) Lender shall receive not less than thirty (30) days prior written notice of any such proposed merger, (ii) no Event of Default shall have occurred and be continuing, (iii) the net worth of the entity surviving such merger shall equal or exceed the net worth of IREIT immediately prior to such merger, and (iv) immediately following such merger, the entity surviving the merger shall be publicly registered with the Securities and Exchange Commission.
(g) Notwithstanding Section 5.2.10(a), at any time other than the period commencing thirty (30) days prior to a loan Securitization and ending thirty (30) days after a Securitization, Lender’s consent shall not be required in connection with the acquisition by IREIT of any entity whether by merger, stock purchase, asset purchase or any other manner; provided that: (i) Lender shall receive not less than thirty (30) days prior written notice of any such proposed transaction, (ii) no Event of Default shall have occurred and be continuing, (iii) IREIT is the surviving entity following such a transaction, and (iv) the net worth of IREIT after the transaction shall equal or exceed the net worth of IREIT immediately prior to such a transaction.
(h) Notwithstanding Section 5.2.10(a), at any time other than the period that is thirty (30) days prior to and thirty (30) days after a Securitization, Lender shall not withhold its consent to, and shall not charge an assumption fee in connection, with a Transfer by IREIT of 1% one hundred percent (100%) of the then outstanding principal amount membership interests in Borrower to a joint venture in which IREIT owns at least twenty-five percent (25%) of the Loanstock, partnership interests or membership interests (“JV Transferee”), provided that (i) Lender receives at least thirty (30) days’ prior written notice of such Transfer, (ii) no Event of Default shall have occurred and be continuing at the time of such written notice or the Transfer, (iii) IREIT maintains operational and managerial control of the JV Transferee and Borrower, (iv) subject to Section 5.16 of the Guaranty Agreement, IREIT and IREIC continue to be Guarantor, (v) IREIT’s partner in the JV Transferee (the “JV Partner”) or the JV Partner’s parent entity shall have at least $350,000,000.00 in assets, (vi) the JV Partner or the JV Partner’s parent entity shall have a net worth of at least $175,000,000.00; (vii) neither the JV Partner nor any of its Affiliates shall have been a party to any bankruptcy proceedings, voluntary or involuntary, made an assignment for the benefit of creditors or taken advantage of any insolvency act, or any act for the benefit of debtors within seven (7) years prior to the date of the proposed Transfer, (viii) Borrower shall pay all of Lender’s reasonable and customary third-party expenses (including reasonable attorneys’ fees and disbursements) actually incurred by Lender in connection with such Transfer and a processing fee equal to $5,000, and (ix) if required or requested by any of the Rating Agencies, Borrower shall deliver a substantive non-consolidation opinion with respect to such Transfer to the JV Transferee.
(i) Lender shall approve or disapprove any proposed Transfer governed by this Section 5.2.10 within thirty (30) days of Lender’s receipt of a wr
Appears in 1 contract
Sources: Loan Agreement (Inland Real Estate Income Trust, Inc.)
Transfers. (a) Without Unless such action is permitted by the prior written consent provisions of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.13, neither Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectively, a “Transfer”): nor Grantor will (i) sell, assign, convey, transfer or otherwise dispose of its interests in the Property or any part thereof, (ii) permit any owner, directly or indirectly, of an ownership interest in the Property, to transfer such interest, whether by transfer of stock or other interest in Grantor or any entity, or otherwise, (iii) incur Indebtedness, (iv) mortgage, hypothecate or otherwise encumber or grant a security interest in the Property or any part thereof, (v) sell, assign, convey, transfer, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect toa security interest in, or otherwise transfer or dispose of any direct or indirect ownership interest in Borrower or Grantor, or permit any owner of an interest in Borrower or Grantor to do the same, or (voluntarily vi) file a declaration of condominium with respect to the Property (any of the foregoing transactions, a "TRANSFER"). For purposes hereof, a "Transfer" shall not include (A) any issuance, sale or involuntarilytransfer of interests in Inland Western Retail Real Estate Trust, Inc., (B) transfer by devise or descent or by operation of law upon the death of a member of Borrower or otherwiseGrantor, and whether (C) a sale, transfer or not for consideration or of record) the Property or any direct or indirect interest therein, or (ii) permit a Sale or Pledge hypothecation of a direct or indirect membership interest in Borrower or Operating LesseeGrantor, other than whichever the case may be, by the current member(s), as applicable, to an immediate family member (Ai.e., parents, spouses, siblings, children or grandchildren) of such member (or a trust for the Operating Lease, (B) pursuant to Leases benefit of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, and (D) Permitted Transfersany such persons).
(ba) Notwithstanding On and after the foregoingdate that is twelve (12) months following the Closing Date, Lender shall not withhold its consent to a sale or conveyance by Borrower Transfer of the Property subject to the lien of the Mortgage (but not any other mortgageProperty, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i1) the transferree of the Property shall be a Special Purpose Entity (the "TRANSFEREE") which at the time of such transfer will be in compliance with the covenants contained in Section 5.1.1 and the representations contained in 4.1.30 hereof and which shall have assumed in writing (subject to the terms of Section 9.4 hereof) and agreed to comply with all the terms, covenants and conditions set forth in this Loan Agreement and the other Loan Documents, expressly including the covenants contained in Section 5.1.1 and the representations contained in 4.1.30 hereof;
(2) if requested by Lender, Grantor shall deliver confirmation in writing from the Rating Agencies that such proposed Transfer will not cause a downgrading, withdrawal or qualification of the then current rating of any securities issued pursuant to such Securitization;
(3) if Manager does not act as manager of the transferred Property then the manager of the Property must be a Qualifying Manager;
(4) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Defaultcontinuing;
(ii5) the Person to whom the Property is sold if required or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents requested by any of the Transferee are reasonably Rating Agencies, Grantor shall deliver a substantive non-consolidation opinion with respect to Transferee, which opinion shall be acceptable to Lender and, after a Securitization, to the Rating Agenciesin its reasonable discretion;;
(iii6) if such sale or conveyance occurs prior to a Securitization, Lender Grantor shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
paid (ivA) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% equal to one percent (1.0%) of the then outstanding principal amount balance of the Loan;
, and (viiiB) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower reasonable and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and customary third-party expenses (including any reasonable attorneys' fees due to the Rating Agenciesand disbursements) actually incurred by Lender in connection with such Transfer; PROVIDED, HOWEVER, no assumption fee shall be required for a Transfer of the sale Property to a Transferee acceptable to Lender in connection with a joint venture between Inland Western Retail Real Estate Trust, Inc. and an institution acceptable to Lender provided Inland Western Retail Real Estate Trust, Inc., or conveyancean Affiliate wholly-owned (directly or indirectly) by Inland Western Retail Real Estate Trust, Inc., owns at least twenty percent (20%) of the ownership interests in such Transferee and for which Inland Western Retail Real Estate Trust, Inc., or an Affiliate wholly-owned (directly or indirectly) by Inland Western Retail Real Estate Trust, Inc., is the managing entity and otherwise maintains operational and managerial control of such Transferee, provided that Grantor shall pay all of Lender's reasonable and customary third-party expenses (including reasonable attorneys' fees and disbursements) actually incurred by Lender in connection with such Transfer and a processing fee of $5,000. Lender shall approve or disapprove any proposed Transfer governed by this Section 5.2.13(a) within thirty (30) days of Lender's receipt of a written notice from Grantor requesting Lender's approval, provided such notice includes all information necessary to make such decision, and further provided that such written notice from Grantor shall conspicuously state, in large bold type, that "PURSUANT TO SECTION 5.2.13 OF THE LOAN AGREEMENT, A RESPONSE IS REQUIRED WITHIN THIRTY (30) DAYS OF LENDER'S RECEIPT OF THIS WRITTEN NOTICE". If Lender fails to disapprove any such matter within such period, Grantor shall provide a second written notice requesting approval, which written notice shall conspicuously state, in large bold type, that "PURSUANT TO SECTION 5.2.13 OF THE LOAN AGREEMENT, THE MATTER DESCRIBED HEREIN SHALL BE DEEMED APPROVED IF LENDER DOES NOT RESPOND TO THE CONTRARY WITHIN TEN (10) DAYS OF LENDER'S RECEIPT OF THIS WRITTEN NOTICE". Thereafter, if Lender does not disapprove such matter within said ten (10) day period such matter shall be deemed approved.
(cb) A Transfer On and after the date that is twelve (but not a pledge, hypothecation, creation of a security interest in or other encumbrance12) of any direct or indirect interests in Borrower is permitted provided that months following the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a SecuritizationClosing Date, Lender shall have consented to such sale or conveyancenot withhold its consent to, which consent and shall not be unreasonably withheld; provided howevercharge an assumption fee in connection with, Lender’s consent shall not be required if(1) a Transfer of up to, after giving effect to in the Transferaggregate, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
forty-nine percent (ii49%) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to Grantor, or (2) a Person individually or together with its Affiliates not owning at least Transfer of greater than forty-nine percent (49% %) of the direct or indirect ownership interests interest in Borrower immediately prior Grantor, PROVIDED that (A) such transfer is to a Qualified Entity (as defined below), and (B) Grantor shall pay all of Lender's reasonable and customary third-party expenses (including reasonable attorneys' fees and disbursements) actually incurred by Lender in connection with such Transfer and a processing fee of $5,000. For purposes of this Agreement, a "QUALIFIED ENTITY" shall mean an entity (x) with a net worth of $200,000,000 or as reflected more, (y) with sufficient experience (determined by Lender in its reasonable discretion) in the most recent Additional Insolvency Opinion delivered ownership and management of properties similar to Lender)the Property, Borrower and (z) which owns or manages retail properties containing at least 1,000,000 square feet of gross leasable area. If required or requested by any of the Rating Agencies, Grantor shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, a substantive non-consolidation opinion with respect to any party not now owning more than 49% of the proposed transfer ownership interests in Grantor acquiring more than 49% of the ownership interests in Grantor.
(c) Notwithstanding anything in this Section 5.2.13 to the contrary, on or saleafter the date that is twelve (12) months after the Closing Date, which Additional Insolvency Opinion Grantor shall be reasonably acceptable permitted to Transfer the entire Property in a single transaction to one newly-formed Special Purpose Entity which shall be wholly-owned subsidiary of Inland Western Retail Real Estate Trust, Inc. ("PERMITTED AFFILIATE TRANSFEREE") which shall be approved by Lender andin its reasonable discretion ("PERMITTED AFFILIATE TRANSFER"), after a Securitization, the Rating Agencies;
provided (iii1) at the time of such Transfer no Event of Default has shall have occurred and is be continuing;
, (iv2) following such Transfer the property manager creditworthiness of Inland Western Retail Real Estate Trust, Inc., as applicable, has not deteriorated, in the sole discretion of Lender, from the Closing Date to the date of the Property must be a Qualified Manager;
(v) if, after giving effect to such proposed Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies (3) Grantor shall have confirmed that such Transfer, in paid all reasonable and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its reasonable out-of-pocket customary third party expenses (including any reasonable attorneys' fees due to the Rating Agenciesand disbursements) actually incurred by Lender in connection with such sale Transfer (but not. any assumption or conveyance; andprocessing fee).
(viid) Grantor, without the consent of Lender, may grant easements, restrictions, covenants, reservations and rights of way in the ordinary course of business for access, parking, water and sewer lines, telephone and telegraph lines, electric lines and other utilities or for other similar purposes, provided that no transfer, conveyance or encumbrance shall materially impair the utility and operation of the Property or materially adversely affect the value of the Property or the Net Operating Income of the Property. If Grantor shall receive any consideration in connection with any Transfer as a result of which Sponsor will not own at least 51% said described transfers or conveyances, Grantor shall have the right to use any such proceeds in connection with any alterations performed in connection therewith, or required thereby. In connection with any transfer, conveyance or encumbrance permitted above, the Lender shall execute and deliver any instrument reasonably necessary or appropriate to evidence its consent to said action or to subordinate the Lien of the equity interests in Borrower Mortgage to such easements, restrictions, covenants, reservations and control, directly rights of way or indirectly, Borrower, Borrower shall give or cause to be given written notice to other similar grants upon receipt by the Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and of: (A) Lender shall have consented to such Transfer a copy of the instrument of transfer; and (B) Borrower shall pay an Officer's Certificate stating with respect to Lender a loan assumption fee of 1% any transfer described above, that such transfer does not materially impair the utility and operation of the then outstanding principal amount Property or materially reduce the value of the LoanProperty or the Net Operating Income of the Property.
(e) Notwithstanding any provision herein to the contrary, in the event of any conflict between the provisions of this Agreement and the provisions of the Ground Lease with respect to Restoration, the provisions of the Ground Lease shall govern.
Appears in 1 contract
Sources: Loan Agreement (Inland Western Retail Real Estate Trust Inc)
Transfers. (a) Borrowers acknowledge that Lender has examined and relied on the experience of Borrowers and their direct and indirect members in owning and operating the Collateral and Mortgage Borrowers in agreeing to make the Loan, and will continue to rely on Borrowers’ ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Additionally, Borrowers acknowledge that Lender has examined and relied on the experience of Mortgage Borrowers and their general partners, members, principals and (if any Mortgage Borrower is a trust) beneficial owners, as applicable, in owning and operating properties such as the Properties and in owning intellectual property such as the IP, in agreeing to make the Loan, and will continue to rely on Mortgage Borrowers’ ownership of the Properties and the IP as a means of maintaining the value of the Properties and the IP and, therefore, indirectly the value of the Collateral, as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrowers acknowledge that Lender has a valid interest in maintaining the value of the Collateral so as to ensure that, should Borrowers default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Collateral.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower Borrowers shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyTransfer Restricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, license, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the any Property or any direct part thereof or indirect any legal or beneficial interest therein, or any IP or any part thereof or any legal or beneficial interest therein, or the Collateral or any part thereof or any legal or beneficial interest therein; or (ii) permit a Sale or Pledge of a direct or indirect any interest in Borrower any Transfer Restricted Party (any of the actions in the foregoing clauses (i) or Operating Lessee(ii), a “Transfer”), other than than, notwithstanding anything to the contrary contained in this Section 5.2.10:
(A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.205.1.20 hereof, including, without limitation, the HRHI Lease;
(B) the pledge of the membership interests in each Mortgage Borrower as collateral for the First Mezzanine Loan and, if applicable, the exercise of applicable remedies or a transfer in lieu of foreclosure under the First Mezzanine Loan Documents by First Mezzanine Lender, subject to the conditions and restrictions set forth in the Intercreditor Agreement;
(C) the Room License Agreementspledge of the membership interests in each First Mezzanine Borrower as collateral for the Loan and, if applicable, the exercise of applicable remedies or a transfer in lieu of foreclosure under the Loan Documents by Lender, subject to the conditions and restrictions set forth in the Intercreditor Agreement;
(D) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower pledge of the Property membership interests in each Borrower as collateral for the Third Mezzanine Loan and, if applicable, the exercise of applicable remedies or a transfer in lieu of foreclosure under the Third Mezzanine Loan Documents by Third Mezzanine Lender, subject to the lien conditions and restrictions set forth in the Intercreditor Agreement;
(E) any Release Parcel Sale, any Adjacent Parcel Sale or an IP Sale, in each instance in accordance with the applicable provisions of Section 2.5 of the Mortgage Loan Agreement;
(but not F) a conveyance of the Deeded Adjacent Property as contemplated by Section 3.2(u) of the Mortgage Loan Agreement;
(G) any other mortgage, lien IP License or other encumbrance Adjacent Property IP License granted in accordance with the provisions of Section 5.1.26 hereof;
(other than H) the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:Permitted IP Encumbrances; and
(iI) no Event the issuance of Default shall have occurred and be continuing and such sale new stock in, the merger or conveyance shall not result consolidation of, and/or the Sale or Pledge of the stock in, any Publicly Traded Entity who owns a direct or indirect ownership interest in an Event of Defaultany Transfer Restricted Party;
(iiJ) the Person transfer of indirect ownership interests in any Mortgage Borrower in order to whom create one or more new mezzanine borrowers for any New Mezzanine Loan as contemplated under the Property is sold or conveyed Mortgage Loan Agreement; and
(K) the “Transferee”) satisfies the requirements transfer by deed of any applicable Partial Release Parcel and/or Partial Adjacent Parcel to a Special Purpose Entity Subsidiary Transferee and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, subsequent transfer of all of the obligations membership interests held by Adjacent Borrower in such Subsidiary Transferee, in each instance in accordance with Section 2.5.1(f) or 2.5.2(f) of the Borrower thereafter arising or to be performed under this Mortgage Loan Agreement, the Mortgage and the other Loan Documents, subjectas applicable; provided, however, to that in the provisions case of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager each of the Property must foregoing clauses (A) – (K), such Transfer shall only be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor permitted hereunder if it does not own at least 51% of the equity interests in Borrower and control Borrowerviolate any Legal Requirements, the Rating Agencies have confirmed that such sale or conveyanceincluding specifically, in and of itselfbut without limitation, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyanceGaming Laws.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein any Borrower or Mortgage Borrower, as applicable, agrees to sell a pledgeProperty or any part thereof, hypothecationthe IP, creation the Collateral or any part thereof for a price to be paid in installments; (ii) an agreement by any Mortgage Borrower leasing all or a substantial part of a Property for other than actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, any Mortgage Borrower’s right, title and interest in and to any Leases or any Rents; (iii) if a Transfer Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Transfer Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation, admission or addition of a general partner or the Sale or Pledge of the general partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Transfer Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation, admission or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing or managing membership interests or the creation or issuance of new non-managing or managing membership interests; (vi) if a Transfer Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Transfer Restricted Party or the creation or issuance of new legal or beneficial interests; (vii) the removal or the resignation of any Manager (including, without limitation, an Affiliated Manager) other than in accordance with the Mortgage Loan Agreement and Section 5.1.22 hereof; or (viii) any deed-in-lieu or consensual foreclosure relating to any Property with or for the benefit of Mortgage Lender or any Affiliate thereof.
(d) Notwithstanding the provisions of this Section 5.2.10, so long as the following Transfers do not violate any Legal Requirements in any instance, including specifically, but without limitation, any Gaming Laws, or cause or otherwise result in the suspension, termination and/or revocation of any Gaming License, the HRHI Lease, the Gaming Sublease or the Casino Component Lease, as applicable, the following Transfers may occur without the consent of Lender or the payment of any transfer or other encumbrancefee, excluding, however, any Transfer of (i) any direct interest in any Mortgage Borrower for so long as the Loan, the Mortgage Loan or any Mezzanine Loan is outstanding, and/or (ii) any direct interest in any Borrower for so long as the Loan or any Mezzanine Loan is outstanding:
(A) the Transfer of any direct or indirect interests interest in Borrower is permitted any Transfer Restricted Party, provided that the following conditions are satisfied:
(i1) if such sale no Event of Default, Mortgage Event of Default or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iii) at the time of such Transfer no Mezzanine Event of Default has occurred and is continuing;
, (iv2) (y) one or both Guarantors continue to Control, directly or indirectly, each Loan Party and HRHI, and (z) one or both Guarantors own, directly or indirectly, at least a fifty-one percent (51%) economic interest in each Loan Party and in HRHI, (3) Lender receives (y) at least ten (10) days prior written notice of any such voluntary Transfer and copies of the documents transferring such interest, or (z) written notice of any such involuntary Transfer and copies of the documents transferring such interest within thirty (30) days following such involuntary Transfer, (4) if after such Transfer any Person and its Affiliates collectively would own more than forty-nine (49%) in the property manager aggregate of the Property must be a Qualified Manager;
direct and/or indirect interests of any Loan Party and as of the Closing Date such Person and its Affiliates collectively owned forty-nine percent (v49%) ifor less in the aggregate of the direct and/or indirect interests of any Loan Party, after giving effect Lender shall have received, prior to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower an Additional Insolvency Opinion reasonably satisfactory to Lender and control Borrower, the Rating Agencies shall have confirmed and, if a Securitization has occurred, a confirmation in writing from the Rating Agencies to the effect that such Transfer, in and of itself, Transfer will not result in a downgradere-qualification, qualification reduction or withdrawal of the then current ratings rating assigned to the Securities
Securities or any class thereof in any applicable Securitization, and (vi5) Borrower shall payBorrowers deliver, or cause Mortgage Borrowers to be paiddeliver, to Lender its reasonable out-of-pocket expenses (a copy of any consents or approvals required by any Governmental Authority, including specifically, but without limitation, any fees due to the Rating Agencies) Gaming Authority, in connection with such sale or conveyance; andTransfer;
(viiB) the Transfer of any direct or indirect interest in connection with any Transfer Restricted Party to any other Person who is, as a result of which Sponsor will not own at least 51% of the equity interests Closing Date, a holder of any direct or indirect interest in Borrower any Transfer Restricted Party, provided that (1) no Event of Default, Mortgage Event of Default or any Mezzanine Event of Default has occurred and controlis continuing, (2) (y) one or both Guarantors continue to Control, directly or indirectly, Borrowereach Loan Party and HRHI, Borrower shall give and (z) one or both Guarantors own, directly or indirectly, at least a fifty-one percent (51%) economic interest in each Loan Party and in HRHI, (3) Lender receives (y) at least ten (10) days prior written notice of any such voluntary Transfer and copies of the documents transferring such interest, or (z) written notice of any such involuntary Transfer and copies of the documents transferring such interest within thirty (30) days following such involuntary Transfer, and (4) Borrowers deliver, or cause Mortgage Borrowers to be given deliver, to Lender a copy of any consents or approvals required by any Governmental Authority, including specifically, but without limitation, any Gaming Authority, in connection with such Transfer;
(C) the Transfer of any direct or indirect interest in any Transfer Restricted Party by inheritance, devise, bequest or operation of law upon the death of a natural person who owned such interest, provided that (1) such Transfer is to a non-minor member of the immediate family of the deceased holder of such interest or a trust established for the benefit of one or more members of the immediate family of the deceased holder of such interest, (2) (y) one or both Guarantors continue to Control, directly or indirectly, each Loan Party and HRHI, and (z) one or both Guarantors own, directly or indirectly, at least a fifty-one percent (51%) economic interest in each Loan Party and in HRHI, (3) such Transfer shall not result in a change of Control of the day-to-day operations of any of the Properties, (4) Lender receives written notice to Lender of such Transfer and copies of the proposed Transfer documents transferring such interest not later than fifteen thirty (1530) days following such Transfer, (5) the legal and financial structure of each Loan Party and the other Transfer Restricted Parties, and the single purpose nature and bankruptcy remoteness of each Loan Party and the other Transfer Restricted Parties, after such Transfer shall satisfy the applicable provisions of the Loan Documents, the Mortgage Loan Documents and/or the First Mezzanine Loan Documents (including, without limitation, Section 4.1.30 hereof and/or Section 4.1.30 of the Mortgage Loan Agreement or the First Mezzanine Loan Agreement, as applicable), (6) if after such Transfer any Person and its Affiliates would collectively own more than forty-nine (49%) in the aggregate of the direct and/or indirect interests of any Loan Party and as of the Closing Date such Person and its Affiliates collectively owned forty-nine percent (49%) or less in the aggregate of the direct and/or indirect interests of any Loan Party, Lender shall have received an Additional Insolvency Opinion reasonably satisfactory to Lender and the Rating Agencies and, if a Securitization has occurred, a confirmation in writing from the Rating Agencies to the effect that such Transfer will not result in a re-qualification, reduction or withdrawal of the then current rating assigned to the Securities or any class thereof in any applicable Securitization, and (7) Borrowers deliver, or cause Mortgage Borrowers to deliver, to Lender a copy of any consents or approvals required by any Governmental Authority, including specifically, but without limitation, any Gaming Authority, in connection with such Transfer; and
(D) (1) the merger or consolidation of any Guarantor or any Constituent Member of any Guarantor with or into any other Person, (2) the sale of any Guarantor or substantially all of any Guarantor’s assets to any other Person, or (3) the issuance of new stock or limited partnership or membership interests in, and/or the Sale or Pledge of stock, limited partnership or membership interests in, any Guarantor or any Constituent Member thereof (any of the occurrences in the foregoing clauses (1), (2) or (3), a “Guarantor Transfer”); provided, that, in each of the foregoing instances, whether or not the applicable Guarantor or the applicable Constituent Member of a Guarantor is or is not a Publicly Traded Company, (I) after giving effect to such Guarantor Transfer, when viewed both individually and together with any prior Guarantor Transfers, (y) the Guarantors, collectively, shall continue to satisfy the Net Worth Requirements, and (z) at least one of the Guarantors shall be a Qualified Real Estate Guarantor, (II) except if the applicable Guarantor or the applicable Constituent Member of a Guarantor is a Publicly Traded Company, Lender receives at least ten (10) days prior theretowritten notice of any such Guarantor Transfer, which notice shall set forth (III) if after such Guarantor Transfer any Person and its Affiliates collectively would own more than forty-nine (49%) in the name aggregate of the direct and/or indirect interests of any Loan Party and as of the Closing Date such Person to which and its Affiliates collectively owned forty-nine percent (49%) or less in the interest in Borrower is to be transferredaggregate of the direct and/or indirect interests of any Loan Party, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented received, prior to such Guarantor Transfer, an Additional Insolvency Opinion reasonably satisfactory to Lender and the Rating Agencies and, if a Securitization has occurred, a confirmation in writing from the Rating Agencies to the effect that such Guarantor Transfer will not result in a re-qualification, reduction or withdrawal of the then current rating assigned to the Securities or any class thereof in any applicable Securitization, and (BIV) Borrower shall pay Borrowers deliver, or cause Mortgage Borrowers to deliver, to Lender a loan assumption fee copy of 1% of the then outstanding principal amount of the Loanany consents or approvals required by any Governmental Authority, including specifically, but without limitation, any Gaming Authority, in connection with such Guarantor Transfer.
(e) With respect to any Transfer permitted under this Section 5.2.10 or otherwise consented to by Lender, Borrowers shall pay, or shall caus
Appears in 1 contract
Sources: Second Mezzanine Loan Agreement (Hard Rock Hotel Holdings, LLC)
Transfers. (a) Each Borrower acknowledges that Lender has examined and relied on the experience of such Borrower and its general partners, members, principals and of IDOT Guarantor and its (if such Borrower is a trust) beneficial owners, as applicable, in owning and operating properties such as the Properties in agreeing to make the Loan, and will continue to rely on such Borrower’s and IDOT Guarantor’s ownership of the Properties as a means of maintaining the value of the Properties as security for repayment of the Debt and the performance of the Other Obligations. Each Borrower and IDOT Guarantor acknowledges that Lender has a valid interest in maintaining the value of the Properties so as to ensure that, should such Borrower or IDOT Guarantor, as applicable, default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Properties.
(b) Without the prior written consent of Lender, Lender and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, each Borrower shall not, and shall not permit IDOT Guarantor or any Person owning a direct or indirect interest in Borrower or Operating Lessee to do any of the following (collectivelyRestricted Party to, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, grant a security interest in, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the any Individual Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower any Individual Property or Operating Lesseein any Restricted Party (collectively, a “Transfer”), other than (A) the Operating Lease, (Bx) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements5.1.20 hereof, and (Dy) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower disposition of the Equipment and other Personal Property subject pursuant to the lien of the Mortgage (but not any other mortgage, lien replacement thereof or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into otherwise in the ordinary course of the operation of the Individual Property.
(c) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein any Borrower or IDOT Guarantor, as applicable, agrees to sell an Individual Property, or any part thereof, for a price to be paid in installments; (ii) an agreement by any Borrower or IDOT Guarantor, as applicable, leasing all or substantially all of an Individual Property for other than actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, such Borrower’s or IDOT Guarantor’s as applicable, right, title and interest in and to any Leases or any Rents; (iii) except as expressly provided in Subsection (d) below, if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) except as expressly provided in Subsection (d) below, if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) except as expressly provided in Subsection (d) below, if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) except as expressly provided in Subsection (d) below, if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of any Manager (including, without limitation, an Affiliated Manager) other than in accordance with Sections 5.1.22 and 5.2.1 hereof.
(d) Notwithstanding the provisions of this Section 5.2.10, the following transfers shall not be deemed to be a Transfer: (i) the sale or transfer, in one or a series of transactions, of not more than forty-nine percent (49%) of the stock or other beneficial interest in a Restricted Party; provided, however, no such sales or transfers shall result in the change of voting control in the Restricted Party, and as a condition to each such sale or transfer, Lender shall receive not less than thirty (30) days’ prior notice of such proposed sale or transfer, and (ii) the sale or transfer, in one or a series of transactions, of not more than forty-nine percent (49%) of the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, no such sales or transfers shall result in the change of voting control in the Restricted Party, and as a condition to each such sale or transfer, Lender shall receive not less than thirty (30) days’ prior notice of such proposed sale or transfer. In no event or circumstances shall Lender’s consent or approval be required with respect to (A) the trading or issuance of shares or other securities of the REIT on a nationally recognized stock exchange, or (B) the transfer, sale or issuance of operating partnership units or other securities of the Property)Guarantor (“OP Units”) to (x) a Qualified Transferee or (y) any Person in connection with a past or future acquisition or sale of any properties or interests therein provided that such Qualified Transferee or the REIT controls the Guarantor and owns not less than a thirty percent (30%) interest in the Guarantor and provided, further that no other Person and its affiliates own in the aggregate more than a thirty percent (30%) interest in the Guarantor or the REIT (it being understood that a Sale or Pledge by the REIT or any other Person owning OP Units in Guarantor or a Sale or Pledge by the Guarantor of its interest in any Person other than direct interest in Borrower, IDOT Guarantor, Operating Tenant or Principal held by the Guarantor or HHC TRS Holding Corporation shall be permitted in connection with a company financing by the REIT or the Guarantor with a Qualified Transferee) or (C) the issuance, transfer or sale of shares of the REIT or the operating partnership units of the Guarantor in connection with the merger, reorganization or consolidation of the REIT or Guarantor, provided, the surviving entity (i) is permitted controlled by the REIT or a Qualified Transferee or (ii) is a publicly listed company on a nationally recognized stock exchange and (x) such entity has a net worth greater than the net worth of the REIT immediately before such merger, reorganization or consolidation and (y) is not managed or controlled by a Person that is a Prohibited Person, a convicted felon, a bankrupt in the past ten (10) years or a litigant in any foreclosure or other enforcement action brought by Lender.
(e) Lender’s prior written consent shall not be required (and no transfer or assumption fees shall be charged by Lender) with respect to a transfer of the Property to an Affiliate of the REIT or Affiliated Manager, provided that, in each such case (i) Lender shall receive sixty (60) days’ prior written notice of any such transfer, (ii) the transferee shall be a single purpose, bankruptcy-remote entity and deliver a non-consolidation opinion reasonably acceptable to Lender, (iii) the REIT shall own, directly or indirectly, fifty-one percent (51%) or more of the equitable and beneficial interests of any such transferee (iv) provided a Securitization shall have occurred, Lender shall receive prior written confirmation from the applicable Rating Agencies that there shall be no downgrade, withdrawal or qualification of the then current ratings of the Securities or any class thereof and (v) Borrower shall pay all reasonable out-of-pocket costs and expenses of Lender in connection with such proposed transfer.
(f) Lender may condition its consent to any proposed transfer that does not meet the conditions of sub-sections (d) or (e) on such other conditions as Lender shall determine in its reasonable discretion to be in the interest of Lender, including, without limitation, the creditworthiness, reputation and qualifications of the transferee with respect to the Loan and the Individual Property. Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Obligations immediately due and payable upon a Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer.
(g) Lender shall not unreasonably withhold consent to an assumption of the Loan; provided that the following conditions are satisfiedmet:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Defaultremain uncured;
(ii) the Person to whom the Property is sold or conveyed proposed transferee (the “Transferee”) satisfies the requirements of shall be a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating AgenciesQualified Transferee;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent the Manager shall not be unreasonably withheldthe manager of the Property following such transfer, then the Manager must be a Qualifying Manager;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon if required by Lender, the delivery of confirmation in writing from each Rating Agencies and their respective successors and assigns, with respect Agency to the Transferee effect that such transfer and its applicable affiliatesassumption of the Loan will not result, solely as the result of such transfer or series of transfers, in a downgrade, withdrawal or qualification of the ratings in effect immediately prior to such proposed transfer for the Securities which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agenciesthen are outstanding;
(v) the Transferee shall execute have executed and delivered to Lender an assumptionassumption agreement in form and substance reasonably acceptable to Lender, effective as evidencing such Transferee’s agreement to abide and be bound by the terms of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this AgreementAgreement (including without limitation Sections 4.1.30 and 5.2.9 hereof), the Mortgage Note, the Mortgages and the other Loan Documents, subjectas applicable, however, to the provisions of Section 9.3 hereof together with such legal opinions and upon such assumption, Borrower shall title insurance endorsements as may be released from all liabilities and obligations under the Loan Documentsreasonably requested by Lender;
(vi) following such sale or conveyance the property manager of the Property must be Lender shall have received a Qualified Manager; and
(vii) non-consolidation opinion covering the Transferee pays to and such other persons reasonably required by Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior opinion to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfer, Sponsor owns not less than 51% of the equity interests in Borrower and controls, directly or indirectly, Borrower;
(ii) if as a result of any such Transfer or series of Transfers more than 49% of the direct or indirect ownership interests in Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately prior to such Transfer (or as reflected in the most recent Additional Insolvency Opinion delivered to Lender), Borrower shall deliver reasonably satisfactory to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;
(iiivii) at the time transfer and assumption shall not occur prior to the first anniversary of such Transfer no Event of Default has occurred and is continuingthe first Payment Date;
(ivviii) following such Transfer payment of a non-refundable assumption fee in the property manager amount of one percent (1%) of the Property must be a Qualified ManagerOutstanding Principal Balance;
(vix) ifthe delivery of evidence satisfactory to Lender that the single purpose nature and bankruptcy remoteness of each Borrower or IDOT Guarantor, after giving effect to as applicable, its shareholders, partners or members, as the case may be, following such Transfer, Sponsor does not own at least 51% of the equity interests Transfers are in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of accordance with the then current ratings assigned to standards of Lender and the SecuritiesRating Agencies;
(vix) Borrower shall payprior to any release of the Guarantor, or cause to be paid, a substitute guarantor reasonably acceptable to Lender its shall have assumed the Guaranty executed by Guarantor or executed a replacement guaranty reasonably satisfactory to Lender; and
(xi) payment of all of fees and expenses reasonably incurred by or on behalf of Lender in connection with such Transfer including, without limitation, the cost of any required third party reports, reasonable legal fees and expenses, Lender’s out-of-pocket expenses, Rating Agency fees and expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as a result of which Sponsor will not own at least 51% of the equity interests in Borrower and control, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loanrequired legal opinions.
Appears in 1 contract
Transfers. (a) Borrower acknowledges that Lender has examined and relied on the experience of Borrower and its stockholders, general partners, members, principals and (if Borrower is a trust) beneficial owners in owning and operating properties such as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s ownership of the Property as a means of maintaining the value of the Property as security for repayment of the Debt and the performance of the Other Obligations. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Property so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the Other Obligations, Lender can recover the Debt by a sale of the Property.
(b) Without the prior written consent of Lender, and except to the extent otherwise set forth in this Section 5.2.10 and Section 2.5 hereof5.2.10, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Borrower or Operating Lessee to Restricted Party do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower any Restricted Party or any assignment of the Operating LesseeLease in violation of this Agreement, other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants Tenants in accordance with the provisions of Section 5.1.20, (C) the Room License Agreements, 5.1.20 and (DB) Permitted Transfers.
(b) Notwithstanding the foregoing, a sale or conveyance by Borrower of the Property subject to the lien of the Mortgage (but not any other mortgage, lien or other encumbrance (other than the Permitted Encumbrances and Room License Agreements hereafter entered into in the ordinary course of operating the Property)) is permitted provided that the following conditions are satisfied:
(i) no Event of Default shall have occurred and be continuing and such sale or conveyance shall not result in an Event of Default;
(ii) the Person to whom the Property is sold or conveyed (the “Transferee”) satisfies the requirements of a Special Purpose Entity and the organizational documents of the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
(iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld;
(iv) Lender has received an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which Additional Insolvency Opinion shall be reasonably acceptable to Lender or, after a Securitization, the Rating Agencies;
(v) the Transferee shall execute an assumption, effective as of the date of transfer, of all of the obligations of the Borrower thereafter arising or to be performed under this Agreement, the Mortgage and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(c) A Transfer (shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a pledgeprice to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space Tenant thereunder or a sale, hypothecationassignment or other transfer of, creation or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or other encumbranceany Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interest or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests; or (vii) the removal or the resignation of the managing agent (including, without limitation, an Affiliated Manager) other than in accordance with Section 5.1.22 hereof.
(d) Notwithstanding the provisions of this Section 5.2.10, the following shall not be deemed a Transfer: the Sale or Pledge in one or a series of transactions, of the direct or indirect equity interests in Borrower or direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
any Restricted Party; provided, that, (i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to the Transfersuch Sale or Pledge, Sponsor owns (A) BREP VI and/or Strategic (I) shall own not less than fifty-one percent (51% %) of the equity direct or indirect legal, economic and beneficial interests in Borrower Borrower, in the aggregate and controls(II) shall Control Borrower, directly or indirectly, Borrower;
(iiB) if as a result of any such Transfer or series of Transfers more (I) Strategic shall own not less than 4936.3747% of the direct or indirect legal, economic and beneficial interest in Borrower and (II) an Approved BREP Transferee shall own the remaining direct or indirect, legal, economic and beneficial interests in Borrower, (ii) Lender shall receive notice of any Sale or Pledge described in this Section 5.2.10(d) not less than thirty (30) days following the consummation thereof (but the failure to deliver any such notice shall not cause the applicable Sale or Pledge to be a Transfer and shall not constitute an Event of Default unless such failure continues for ten (10) Business Days following notice of such failure from Lender), (iii) no Sale or Pledge of any direct interest in any Borrower or Operating Lessee shall be permitted, (iv) for so long as the Mezzanine B Loan shall remain outstanding, no such Sale or Pledge of any direct interests in Mezzanine A Borrower shall be permitted, (v) for so long as the Loan or any Mezzanine Loan shall remain outstanding, (A) no pledge or other encumbrance of any direct interests in any Restricted Pledge Party shall be permitted (other than the pledges securing the Loan, the Mezzanine A Loan or the Mezzanine B Loan), and except that a pledge of the direct ownership interests in Borrower the most upper-tier Restricted Pledge Party shall be transferred to permitted if such pledge directly or indirectly secures indebtedness that is also directly or indirectly secured by substantial assets other than the Property and the IP Collateral; and (B) no Restricted Pledge Party shall issue preferred equity that has the characteristics of mezzanine debt (such as a Person individually or together with its Affiliates not owning at least 49% fixed maturity date, regular payments of interest, a fixed rate of return and rights of the equity holder to demand repayment of its investment), and (vi) none of Borrower, Operating Lessee, Operating Lessee GP or North Beach Company shall fail to be a Special Purpose Entity by reason of such Sale or Pledge. If after giving effect to any such Sale or Pledge, more than forty-nine percent (49%) in the aggregate of direct or indirect ownership interests in Borrower immediately prior to a Restricted Party are owned by any Person and its Affiliates that owned less than forty-nine percent (49%) direct or indirect interest in such Transfer (or Restricted Party as reflected in of the most recent Additional Insolvency Opinion delivered to Lender)Closing Date, Borrower shall deliver to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender andand the Approved Rating Agencies. Notwithstanding anything to the contrary contained in this Agreement, no notice to, or consent of, Lender shall be required in connection with any Sale or Pledge of direct or indirect interests in any Excluded Entity.
(e) No Transfer of the Property and assumption of the Loan shall occur during the period that is sixty (60) days prior to and sixty (60) days after a Securitization, . A Transfer of the Rating Agencies;
Property or 100% of the legal or beneficial ownership interests therein or in Borrower and assumption of the entire Loan not otherwise permitted by Section 5.2.10(d) to a Qualified Transferee shall be permitted without Lender’s consent (iiia “Permitted Assumption”); provided that Lender receives thirty (30) at the time days prior written notice of such Transfer and no Event of Default has occurred and is continuingcontinuing at the time such Permitted Assumption is consummated, and further provided that the following additional requirements are satisfied:
(i) Borrower shall pay Lender a transfer fee equal to Two Hundred Thousand and No/100 Dollars ($200,000.00).
(ii) Borrower shall pay any and all reasonable out-of-pocket costs incurred in connection with such Permitted Assumption (including, without limitation, Lender’s reasonable counsel fees and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes and the fees and expenses of the Approved Rating Agencies pursuant to clause (x) below);
(iii) Intentionally Omitted;
(iv) following such Transfer the property manager of the Property must be a Qualified ManagerIntentionally Omitted;
(v) ifQualified Transferee and Qualified Transferee’s Principals must not have been the subject of any Bankruptcy Action within seven (7) years prior to the date of the proposed Transfer;
(vi) With respect to a Transfer of the Property, after giving effect Qualified Transferee shall assume all of the obligations of Borrower under the Loan Documents in a manner satisfactory to such TransferLender in all respects, Sponsor does not own at least 51including, without limitation, by entering into an assumption agreement in form and substance satisfactory to Lender;
(vii) There shall be no material litigation relating to the creditworthiness or reputation of Qualified Transferee, Qualified Transferee’s Principals and all other entities which may be owned or Controlled directly or indirectly by Qualified Transferee’s Principals (“Related Entities”), or regulatory action pending or threatened against Qualified Transferee, Qualified Transferee’s Principals or any Related Entity;
(viii) Intentionally omitted;
(ix) Qualified Transferee must be able to satisfy all representations and covenants in Section 4.1.30 hereof (or in the event of a transfer of 100% of the equity interests in Borrower and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall paycontinue to satisfy all representations and covenants in Section 4.1.30), and in all cases Qualified Transferee and Qualified Transferee’s Principals must be able to satisfy all the representations and covenants set forth in Sections 4.1.35, 5.1.23 and 5.2.9 of this Agreement, no Default or cause to be paid, to Lender its reasonable out-of-pocket expenses (including any fees due to the Rating Agencies) in connection with such sale or conveyance; and
(vii) in connection with any Transfer Event of Default shall otherwise occur as a result of which Sponsor will not own at least 51% of the equity interests in Borrower such Transfer, and control, directly or indirectly, Borrower, Borrower Qualified Transferee shall give or cause to be given written notice to Lender of the proposed Transfer not later than fifteen (15) days prior thereto, which notice shall set forth the name of the Person to which the interest in Borrower is to be transferred, identify the proposed transferee and set forth the date the Transfer is expected to be effective and deliver (A) all organizational documentation reasonably requested by Lender, which shall be reasonably satisfactory to Lender and, following a Securitization, satisfactory to the Approved Rating Agencies and (B) all certificates, agreements, covenants and legal opinions reasonably required by Lender;
(x) If required by Lender, following or in connection with a Securitization, Qualified Transferee shall have consented be approved by the Approved Rating Agencies, which approval, if required by Lender, shall take the form of a Rating Agency Confirmation with respect to such Permitted Assumption; provided that a written waiver or acknowledgment from one or more of the Approved Rating Agencies indicating its decision not to review the Permitted Assumption for which the Rating Agency Confirmation is sought shall be deemed to satisfy the required for the Rating Agency Confirmation with respect to such Approved Rating Agency.
(xi) Guarantor shall be released from the Guaranty for all liability accruing after the date of a Transfer (A) so long as one (1) or more substitute guarantors is a Qualified Transferee (excluding clause (iv) or (v) of the definition thereof) or is otherwise acceptable to Lender in its sole discretion and such substitute guarantor has assumed all of the liabilities and obligations of Guarantor under the Guaranty or has executed a replacement guaranty satisfactory to Lender in its sole discretion, in each case covering all liability accruing after the date of such assumption or execution and (B) Borrower shall pay has delivered to Lender customary legal opinions relating to authorization and enforceability of the additional guaranty contemplated above, substantially similar in form and substance to the opinions delivered to Lender on the Closing Date relating to the Guaranty, or otherwise in form and substance reasonably acceptable to Lender in its sole discretion, including, to the extent the Guarantor being released was included in the Insolvency Opinion delivered at closing, an Additional Insolvency Opinion with respect to any replacement guarantor.
(xii) If the Permitted Assumption is accomplished by deed or conveyance of the Property rather than by assignment of all of a loan Restricted Party’s interests in Borrower, Borrower shall deliver, at its sole cost and expense, an endorsement to the Title Insurance Policy, as modified by the assumption fee agreement, as a valid first lien on the Property and naming the Qualified Transferee as owner of 1the Property, which endorsement shall insure that, as of the date of the recording of the assumption agreement, the Property shall not be subject to any additional exceptions or liens other than those contained in the Title Policy issued on the date hereof and the Permitted Encumbrances;
(xiii) The Property shall be managed by Qualified Manager pursuant to a Replacement Management Agreement;
(xiv) Borrower or Qualified Transferee, at its sole cost and expense, shall deliver to Lender an Additional Insolvency Opinion reflecting such Transfer satisfactory in form and substance to Lender; and
(xv) Borrower shall have obtained, or caused Mezzanine Borrower to obtain the most junior Mezzanine Lender’s prior written consent to such Permitted Assumption, which consent shall not be unreasonably withheld, conditioned or delayed. Immediately upon a Transfer to such Qualified Transferee and the satisfaction of all of the above requirements, the named Borrower and Guarantor herein shall be released from all liability under this Agreement, the Note, the Mortgage and the other Loan Documents for acts or omissions occurring after such Transfer. The foregoing release shall be effective upon the date of such Transfer, but Lender agrees to provide written evidence thereof reasonably requested by Borrower.
(f) Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon Borrower’s Transfer without Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer.
(g) Notwithstanding anything to the contrary contained herein or in any other Loan Document, to the extent either BREP Guarantor or Strategic (but not both) Transfers one hundred percent (100%) of its interests in Borrower and each Restricted Party in accordance with this Section 5.2.10 to (I) a third party unaffiliated with the remaining Guarantor or (II) the remaining Guarantor (such that either BREP Guarantor or Strategic is the sole owner of 100% of the then outstanding principal amount interests in Borrower and each Restricted Party), then, in each case, the Guarantor Transferring its interests shall be released from the Guaranty for all liability accruing after the date of the Loansuch Transfer.
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Transfers. (a) Without Borrower acknowledges that Lender has examined and relied on the prior written consent experience of LenderBorrower and its general partners, members, principals and (if Borrower is a trust) beneficial owners in owning the Collateral in agreeing to make the Loan, and except will continue to rely on Borrower’s ownership of the Collateral as a means of maintaining the value of the Collateral as security for repayment of the Debt and the performance of the obligations contained in the Loan Documents. Borrower acknowledges that Lender has a valid interest in maintaining the value of the Collateral so as to ensure that, should Borrower default in the repayment of the Debt or the performance of the obligations contained in the Loan Documents, Lender can recover the Debt by a sale of the Collateral.
(b) Except in connection with a release of an Individual Property or an Out Parcel pursuant to the extent otherwise terms and conditions set forth in this Sections 2.5 and 2.9 hereof or the substitution of an Individual Property pursuant to the terms and conditions set forth in Section 5.2.10 and 2.8 or the permissible easements provided for in Section 2.5 hereof2.10 of the Mortgage Loan Agreement, Borrower shall not, and shall not permit any Person owning a direct or indirect interest in Mortgage Borrower or Operating Lessee Baltimore Owner, to do any of the following (collectively, a “Transfer”): (i) sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the any Collateral or Individual Property or any direct part thereof or indirect any legal or beneficial interest therein, therein or (ii) permit a Sale or Pledge of a direct or indirect an interest in Borrower or Operating Lesseeany Restricted Party (collectively, a “Transfer”), other than (A) the Operating Lease, (B) pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 5.1.205.1.20 hereof and encumbrances described in Section 5.2.10(d)(vi) below, without (i) the prior written consent of Lender and (ii) if a Securitization has occurred or is pending within thirty (30) days, delivery to Lender of written confirmation from the Rating Agencies that the Transfer will not result in the downgrade, withdrawal or qualification of the then current ratings assigned to any Securities or the proposed rating of any Securities.
(c) A Transfer shall include, but not be limited to: (i) an installment sales agreement wherein any Individual Borrower agrees to sell the Collateral or any part thereof or Mortgage Borrower or Baltimore Owner agrees to sell the Properties, or any part therefor, in each case for a price to be paid in installments; (ii) an agreement by Borrower, Mortgage Borrower and/or Baltimore Owner leasing all or a substantial part of any Individual Property for other than actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, its respective right, title and interest in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general partner or any profits or proceeds relating to such partnership interest, or the Sale or Pledge of limited partnership interests or any profits or proceeds relating to such limited partnership interests or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of a managing member (or if no managing member, any member) or any profits or proceeds relating to such membership interest, or the Sale or Pledge of non-managing membership interests or the creation or issuance of new non-managing membership interests; or (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests.
(d) Notwithstanding the provisions of Sections 5.2.10(a), (Cb) and (c) hereof, the following transfers shall not be deemed a Transfer: (i) a transfer by devise or descent or by operation of law upon the death of a member, partner or shareholder of a Restricted Party; (ii) the Room License AgreementsSale or Pledge, in one or a series of transactions, of not more than forty-nine percent (49%) of the stock, general partnership interest or managing membership interest (as the case may be) in a Restricted Party; provided, however, no such transfers shall result in the change of voting control in the Restricted Party, and as a condition to each such transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed transfer, (iii) the Sale or Pledge, in one or a series of transactions, of not more than forty-nine percent (49%) of the limited partnership interests or non-managing membership interests (as the case may be) in a Restricted Party; provided, however, as a condition to each such transfer, Lender shall receive not less than thirty (30) days prior written notice of such proposed transfer, (iv) transfers, issuances, pledges and redemptions of stock in Wyndham, so long as (A) Wyndham (or its successor) is (or is Controlled by) a Public Company and (B) the surviving entity is primarily involved in, or has a significant business line involving, the ownership and operation of real estate similar to the Properties, (v) the merger or consolidation of Wyndham, provided that the surviving entity of such merger or consolidation is (or is Controlled by) (A) a Public Company, and (DB) Permitted Transfers.
(b) Notwithstanding primarily involved in, or has a significant business line involving, the foregoing, a sale ownership or conveyance by Borrower operation of the Property subject real estate similar to the lien Properties, (vi) the granting of the Mortgage (but not any other mortgageeasements, lien or other encumbrance (other than the Permitted Encumbrances cross-easements, agreements, restrictions, reservations and Room License Agreements hereafter entered into rights in the ordinary course of operating the Property)) is permitted business for use, access, water and sewer lines, telephone and telegraph lines, electric lines or other utilities or for other similar purposes, provided that no such easements, agreements, restrictions or rights shall materially impair the following conditions utility and/or operation of any Individual Property or any Individual Borrower’s ability to repay the Debt as it becomes due, (vii) transfers of direct or indirect interests in any Mortgage Borrower, Mortgage Principal, Baltimore Owner or Individual Borrower to Affiliates of Wyndham (or its successor) provided that after such transfers (A) Wyndham (or its permitted successor) owns, directly or indirectly, not less than fifty-one percent (51%) of the legal and beneficial ownership interests in such Individual Borrower, Mortgage Principal, Mortgage Borrower and Baltimore Owner and (B) such Individual Borrower, Mortgage Principal, Mortgage Borrower and Baltimore Owner are satisfied:
Controlled, directly or indirectly, by Wyndham (ior its permitted successor), (viii) no Event pledges of Default shall have occurred direct and be continuing indirect interests in any Borrower, Mortgage Principal, Mortgage Borrower, Baltimore Owner and such sale or conveyance shall not result in an Event any Mezzanine Borrower to any Mezzanine Lender as collateral for a Mezzanine Loan and the exercise by any Mezzanine Lender of Default;
its remedies under the Mezzanine Loan Documents, (iiix) a conversion of Wyndham’s preferred stock to common stock and/or the conversion of Wyndham to a real estate investment trust and (x) the Person recapitalization of Wyndham and the related transactions contemplated by the Recapitalization and Merger Agreement dated as of April 14, 2005 by and among Wyndham International, Inc., WI Merger Sub, Inc., Apollo Investment Fund IV L.P., AIF/THL PAH LLC, BCP Voting Trust, as Trustee for the Beacon Partners Voting Trust, ▇▇▇▇▇▇ ▇. ▇▇▇ Equity Fund IV, L.P., ▇▇▇▇▇▇ ▇. ▇▇▇ Foreign Fund IV, L.P. and ▇▇▇▇▇▇ ▇. ▇▇▇ Foreign Fund IV-B, L.P., as the same may be amended, restated, supplemented or otherwise modified from time to whom the Property is sold or conveyed time (the “TransfereeRecap Agreement”). In addition (but not including and in addition to the mergers and consolidations pursuant to the Recap Agreement) satisfies on a one time basis, Wyndham may merge or consolidate with a public or private entity or engage in a transaction described in Section 5.2.10(d)(iv) above in which the requirements surviving entity is not, and is not Controlled by, a Public Company provided that (A) after such merger, consolidation, or Sale or Pledge described in Section 5.2.10(d)(iv) each Borrower, Mortgage Principal, Mortgage Borrower and Baltimore Owner shall continue to comply with the terms of Section 4.1.30 hereof, (B) such merger or consolidation or Sale or Pledge is to a Qualified Transferee or to a Person Controlled by a Qualified Transferee which Qualified Transferee shall Control and own directly or indirectly, not less than 50% of the direct or indirect legal and beneficial ownership interests of each Individual Borrower and Baltimore Owner, and (C) the surviving entity is primarily involved in, or has a significant business line involving, the ownership and operation of real estate similar to the Properties. Furthermore, notwithstanding the provisions of Sections 5.2.10(a), (b) and (c) hereof, in the event that an entity, which is an indirect owner of a Special Purpose Entity Minority Interest Borrower and which is not a Principal (as such term is defined in the organizational documents Mortgage Loan Agreement, as the context requires) of an Individual Borrower, Mortgage Borrower or Baltimore Owner, forms a subsidiary to acquire an asset and thereafter redeems the Transferee are reasonably acceptable to Lender and, after a Securitization, to the Rating Agencies;
interests of one or more minority interest holders of such indirect owner (iii) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent redeemed minority interest holders shall not be unreasonably withheld;
Affiliates of Guarantor) by transferring all or a portion of the direct legal and beneficial interests in such newly formed subsidiary to such minority interest holders (ivor their designees), such formation, redemption and transfer shall not constitute a Transfer and, subject to compliance with the immediately following sentence, shall not otherwise be a violation of the terms of this Agreement or require Lender’s consent. Notwithstanding anything to the contrary contained in this Agreement, no sale, pledge or other transfer shall be permitted of any direct (as opposed to indirect) Lender has received interests in any entity in which any Individual Borrower, Mortgage Principal, Mortgage Borrower or Baltimore Owner owns a direct or indirect interest except pursuant to Section 5.2.10(f). In connection with any transfer or merger permitted under this Section 5.2.10, Borrower shall deliver an Additional Insolvency Opinion which if, after such transfer or merger, more than forty-nine percent (49%) of any direct legal or beneficial interest in any Individual Borrower, Mortgage Principal, Mortgage Borrower or Baltimore Owner, as the case may be relied upon (or in any constituent entity of any Individual Borrower, Mortgage Principal, Mortgage Borrower or Baltimore Owner that is required to comply with the terms of Section 4.1.30 hereof), is owned by Lender, the Rating Agencies and their respective successors and assigns, with respect to the Transferee and its applicable affiliates, which a new or successor entity. Such Additional Insolvency Opinion shall be reasonably acceptable to Lender or(I) Lender, after prior to a Securitization, Securitization or (II) the Rating Agencies;
, if a Securitization has occurred. Notwithstanding anything to the contrary contained herein, pledges and hypothecations of indirect equity interests in any Individual Borrower, Mortgage Principal, Mortgage Borrower or Baltimore Owner shall be permitted provided (vA) Wyndham (or its permitted successors) maintains Control of, and owns, directly or indirectly, not less than fifty-one percent (51%) of the Transferee shall execute an assumptionlegal and beneficial ownership interests in such Individual Borrower, effective Mortgage Principal, Mortgage Borrower or Baltimore Owner, as the case may be, and (B) any such pledges or hypothecations are in connection with the corporate credit facilities of Wyndham (or its permitted successors) and JPMorgan Chase Bank, N.A., as administrative agent, and Bear ▇▇▇▇▇▇▇ Corporate Lending Inc., as syndication agent, and the lenders party to that certain First-Lien Credit Agreement dated as of the date hereof, and JPMorgan Chase Bank, N.A., as administrative agent, and Bear ▇▇▇▇▇▇▇ Corporate Lending Inc., as syndication agent, and the lenders party to that certain Second-Lien Credit Agreement dated as of transferthe date hereof, as amended, or another credit agreement with an institutional lender or a public bond offering to prepay or refinance in full or in part any such credit facility which an institutional lender or bondholders (or the trustee on their behalf), as applicable, shall be making or holding a loan to Wyndham (or its permitted successors) or its Affiliates (other than any Individual Borrower or its general partner or managing member). A foreclosure sale (or transfer in lieu thereof) of any such pledge or hypothecation to JPMorgan Chase Bank, N.A., or another institutional lender as collateral agent for syndicate lenders or another institutional lender, or the bond trustee, shall be permitted provided (1) Lender is given at least sixty (60) days prior written notice of the proposed foreclosure sale or transfer in lieu thereof; (2) the transferee is a reputable entity or person, creditworthy, with sufficient financial worth considering any obligations assumed and undertaken with respect to the Loan, as evidenced by financial statements and other information reasonably requested by Lender; (3) the Properties at all times shall continue to be managed by a Qualified Manager, and (4) and any and all such entities will comply with all of the obligations of requirements set forth in the Borrower thereafter arising or to be performed under Note, this Agreement, the Mortgage Mortgages and the other Loan Documents, subject, however, to the provisions of Section 9.3 hereof and upon such assumption, Borrower shall be released from all liabilities and obligations under the Loan Documents;
(vi) following such sale or conveyance the property manager of the Property must be a Qualified Manager; and
(vii) the Transferee pays to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan;
(viii) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower and control Borrower, the Rating Agencies have confirmed that such sale or conveyance, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities; and
(ix) Borrower pays Lender’s reasonable costs and expenses (including any fees due to the Rating Agencies) in connection with the sale or conveyance.
(ce) A Transfer (but not a pledge, hypothecation, creation of a security interest in or other encumbrance) of any direct or indirect interests in Borrower is permitted provided that the following conditions are satisfied:
(i) if such sale or conveyance occurs prior to a Securitization, Lender shall have consented to such sale or conveyance, which consent shall not be unreasonably withheld; provided however, Lender’s consent shall not be required if, after giving effect to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon a Transfer without Lender’s consent to the extent required hereunder. This provision shall apply to every Transfer regardless of whether voluntary or not, or whether or not Lender has consented to any previous Transfer. Notwithstanding anything to the contrary contained in this Section 5.2.10, Sponsor owns (i) no transfer (whether or not less than 51% of the equity interests in Borrower such transfer shall constitute a Transfer) shall be made to any Prohibited Person and controls, directly or indirectly, Borrower;
(ii) if as in the event any transfer (whether or not such transfer shall constitute a result Transfer) results in any Person owning in excess of any such Transfer or series of Transfers more than forty-nine percent (49% %) of the direct or indirect ownership interests interest in a Restricted Party, Borrower shall be transferred to a Person individually or together with its Affiliates not owning at least 49% of the direct or indirect ownership interests in Borrower immediately shall, prior to such Transfer (or as reflected in the most recent Additional transfer, deliver an updated Insolvency Opinion delivered to Lender), Borrower which opinion shall deliver be in form, scope and substance reasonably acceptable in all respects to Lender an Additional Insolvency Opinion which may be relied upon by Lender, the Rating Agencies and their respective counsel, successors and assigns, with respect to the proposed transfer or sale, which Additional Insolvency Opinion shall be reasonably acceptable to Lender and, after a Securitization, the Rating Agencies;.
(iiif) at Notwithstanding anything to the contrary contained in this Section 5.2.10, Lender shall not withhold its consent to a one-time sale, assignment, or other transfer of all of the Properties and of the Collateral provided that (i) Lender receives thirty (30) days prior written notice of such Transfer transfer, (ii) no Event of Default has occurred and is continuing;continuing and (iii) upon the satisfaction (in the reasonable determination of Lender) of the following matters:
(ivA) following such Transfer Mortgage Borrower (or Baltimore Owner, as the property manager of the Property must be a Qualified Manager;
(vcase may be) if, after giving effect to such Transfer, Sponsor does not own at least 51% of the equity interests in Borrower or Transferee shall pay any and control Borrower, the Rating Agencies shall have confirmed that such Transfer, in and of itself, will not result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities
(vi) Borrower shall pay, or cause to be paid, to Lender its all reasonable out-of-pocket expenses costs incurred in connection with the transfer (including any including, without limitation, Lender’s reasonable counsel fees due and disbursements and all recording fees, title insurance premiums and mortgage and intangible taxes);
(B) The proposed transferee (the “Transferee”) shall be one or more special purpose bankruptcy remote entities, each of which (i) complies with all of the requirements of Section 4.1.30 hereof and whose organizational documents are substantially similar to Mortgage Borrower’s and Baltimore Owner’s organizational documents, or if not substantially similar, acceptable to the Rating AgenciesAgencies and (ii) in connection with such sale or conveyance; and
(vii) in connection with any Transfer as is Controlled by a result of Qualified Transferee, which Sponsor will not own at least 51% of the equity interests in Borrower and controlQualified Transferee shall own, directly or indirectly, Borrower, Borrower shall give or cause to be given written notice to Lender not less than fifty percent (50%) of the proposed Transfer not later than fifteen legal and beneficial ownership interests in such Transferee;
(15C) days prior thereto, which notice Transferee shall set forth the name assume all of the Person to which obligations of Mortgage Borrower under the interest in Borrower is to be transferredNote, identify this Agreement, the proposed transferee Mortgages and set forth the date the Transfer is expected to be effective and (A) Lender shall have consented to such Transfer and (B) Borrower shall pay to Lender a loan assumption fee of 1% of the then outstanding principal amount of the Loan.other Mortgage Loan Documen
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Sources: Mezzanine Loan Agreement (Wyndham International Inc)