Exhibit 10.1
AMENDED AND RESTATED CASH PARTICIPATION AGREEMENT
AMENDED AND RESTATED CASH PARTICIPATION AGREEMENT (this
"Agreement"), dated as of January 1, 2002, by and among ▇▇▇▇▇▇▇ ▇▇ LLC (formerly
known as Brynmawr Associates LLC), a Delaware limited liability company
("▇▇▇▇▇▇▇ ▇▇"), ▇▇▇▇▇▇▇ Capital LLC (formerly known as Brynmawr Capital LLC), a
Delaware limited liability company ("Capital"), ▇▇▇▇▇▇▇ RE Associates LLC, a
Delaware limited liability company ("▇▇▇▇▇▇▇ RE"), ▇▇▇▇▇▇▇ Stock LLC, a Delaware
limited liability company ("Stock"), ▇▇▇▇▇▇▇ Associates LLC, a Delaware limited
liability company ("Associates"), Vornado Realty L.P., a Delaware limited
partnership ("Vornado"), Vornado ▇▇▇▇▇▇▇ L.L.C. , a Delaware limited liability
company ("Vornado ▇▇▇▇▇▇▇"), VNK Corp., a Delaware corporation ("VNK"), on the
one hand, and Administrator LLC, a Delaware limited liability company, as agent
("Administrator LLC") for itself and as agent for the persons listed on Schedule
A to this Agreement (collectively, the "Selling Group"), on the other.
WHEREAS, certain of the parties hereto previously entered into that
certain Cash Participation Agreement, dated as of November 20, 1997, among
▇▇▇▇▇▇▇ ▇▇, Capital and Administrator, as modified by that certain Assumption
Agreement, dated as of July 8, 1998 by Vornado, Vornado ▇▇▇▇▇▇▇, VNK,
Associates, ▇▇▇▇▇▇▇ RE and Stock (collectively, the "Original Agreement"),
WHEREAS, the Original Agreement was entered into as a condition to
the consummation of the transactions contemplated by that certain Purchase and
Sale Agreement, dated July 2, 1997 (as amended and supplemented, the "Purchase
Agreement"), between Apollo Real Estate Investment Fund II, L.P., a Delaware
limited partnership ("Fund II"), and the Selling Group pursuant to which it was
agreed that, among other things, (i) the Selling Group would sell or cause to be
sold the ▇▇▇▇▇▇▇ Assets (as defined below) to Fund II and (ii) Fund II and/or
its permitted assigns would cause a loan to be made to the Selling Group or its
designees in the original principal amount of $40,000,000, all on the terms, and
subject to the conditions, set forth in the Purchase Agreement;
WHEREAS, Fund II assigned all its right, title and interest in and
to the Purchase Agreement to Apollo Real Estate Investment Fund III, L.P., a
Delaware limited partnership ("Fund III, and together with Fund II, the
"Funds"), and Fund III assumed all duties, obligations and liabilities of Fund
II under the Purchase Agreement;
WHEREAS, certain indirect subsidiaries of Fund III were assigned the
right to acquire the ▇▇▇▇▇▇▇ Assets from the Selling Group and assumed, all
duties, obligations and liabilities in connection therewith;
WHEREAS, pursuant to the Purchase Agreement, part of the
consideration payable on account of the sale of the ▇▇▇▇▇▇▇ Assets consisted of
a participation in certain of the revenues of the Brynmawr Entities (as defined
below), the Funds and their respective Affiliates (as defined below), and
certain of the parties hereto entered into the Original Agreement to provide for
the terms of such participation;
WHEREAS, certain of the Brynmawr Entities and/or their respective
Affiliates desire to enter into a transaction (the "Transaction") pursuant to
which certain of the assets of the Brynmawr Entities and/or their respective
Affiliates will be transferred to or merged into The ▇▇▇▇▇▇▇ Master Limited
Partnership (the "Master Limited Partnership"), a newly-formed Delaware limited
partnership, all as more fully described in that certain Consent Solicitation
Statement/Offering Circular dated October 23, 2001, a copy of which is attached
hereto as Exhibit A (the "Consent Solicitation");
WHEREAS, simultaneously herewith the parties hereto are entering
into that certain Agreement (the "Transaction Agreement") pursuant to which they
agreed, among other things, to amend and restate the Original Agreement;
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties do hereby agree to amend
and restate the Original Agreement in its entirety as follows:
1. Definitions.
For purposes of this Agreement, the following terms shall have
the following meanings:
"Acceleration Premium" has the meaning ascribed thereto in the
Loan Agreement.
"Actual Transfer" means with respect to any Person or asset,
the transfer, sale, distribution or conveyance of that Person or asset to any
Person, and shall include, without limitation, the following: (i) the grant of
any Acquisition Right with respect to that Person or asset, or (ii) the issuance
of any Convertible Security with respect to that Person or asset or (iii) any
transaction or series of transactions having the effect, directly or indirectly,
of a transfer, sale, distribution or conveyance of that Person or asset,
including without limitation by way of a merger (straight, reverse or other),
consolidation, operation of law, a transfer of ownership interests (including
without limitation partnership interest, stock, or other beneficial or equitable
rights conveying an ownership interest or claim), a grant or receipt of options
or other rights to acquire, sell or use assets, in each case whether
accomplished directly or indirectly.
"Acquisition Financing" means any borrowings of any
Outside-the-Box Entity used to finance the payment of any obligation to pay
money to the Selling Group or its designees under any Transaction Document, any
Additional Capital Contribution or otherwise. The parties hereby acknowledge and
agree that, for purposes of this Agreement, the amount of any Acquisition
Financing shall first reduce the amount of the Apollo Capital Account until it
is zero and at all other times shall be included as an addition in the
computation of Available Cash Flow; the amount of any payment of principal or
interest on any Acquisition Financing shall at all times be included as a
deduction in the computation of Available Cash Flow.
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"Acquisition Right" means, with respect to any Person or
asset, any right (contingent or fixed, matured or unmatured, or otherwise) to
acquire that Person or asset for consideration other than cash in an amount
which is equal to or in excess of the fair market value thereof at the time of
the exercise of such right. Any consideration given for an Acquisition Right
shall, subject to Section 6.b of this Agreement, be included within Available
Cash Flow at the time it is given; any consideration given upon the exercise of
an Acquisition Right shall, subject to Section 6.b of this Agreement, be
included within Available Cash Flow at the time it is given.
"Additional Capital Contributions" means, subject to Section
2.b of this Agreement, any additional capital contributions or other advances
made by an Outside-the-Box Entity (including, without limitation, the
Acceleration Premium and any out-of-pocket costs incurred by the Outside-the-Box
Entities (such as legal costs, financing costs and due diligence costs)), the
proceeds of which are paid to unaffiliated third parties on an arm's length
basis (either by an Outside-the-Box Entity directly or by an Inside-the-Box
Entity to which such capital contribution or other advance is directly or
indirectly made) from the funds of the Outside-the-Box Entity and not from other
funds of any Inside-the-Box Entity (including without limitation any Net Lease
Partnership or a general partner thereof), provided that such additional capital
contributions or other advances shall constitute Additional Capital
Contributions only to the extent they are made for use by or to benefit or
otherwise with respect to ▇▇▇▇▇▇▇ Assets that are not Section 6b(i) Transfer
Assets and not to the extent they are made for use by or to benefit or otherwise
with respect to Section 6b(i) Transfer Assets or other Non-▇▇▇▇▇▇▇ Assets.
Notwithstanding anything to the contrary in this Agreement, in no event shall an
item that is included within Additional Capital Contributions be included as an
expense under clause (4)(y) of the definition of Available Cash Flow, or vice
versa.
"Administrator LLC" has the meaning set forth in the recitals
to this Agreement.
"Affiliate" has the meaning ascribed thereto by (A) Rule 405
promulgated under the Securities Act of 1933, as amended, except that ownership
of more than 10% of the voting securities of, or more than 10% of the economic
rights in, any Person shall conclusively be deemed to make that Person an
Affiliate, and (B) if there is a lesser threshold for a Person to be deemed an
"Affiliate" of another under the common law of the State of New York, then the
common law of the State of New York. Without limiting the foregoing, for
purposes of this definition, the ownership of any debt, equity, right(s) or
other interest(s) that either (i) is convertible into, or otherwise grants the
right to acquire, voting securities or economic rights for consideration other
than cash in an amount equal to or in excess of the fair market value thereof at
the time of such conversion or acquisition or (ii) grants upon the owner rights
that are substantially similar to those conferred by voting securities
(including, without limitation, equity participations) or economic rights shall
constitute ownership of voting securities or economic rights. For purposes of
this definition, the "Affiliates" of a Brynmawr Entity or any of their
respective Affiliates (x) shall, with respect to any Actual Transfer, include
any Person that would become an Affiliate of a Brynmawr Entity or any of their
respective Affiliates as a result of that Actual Transfer and (y) shall include
the general partner of the Master Limited Partnership. In the event of an Actual
Transfer of any Brynmawr Entity, entities that were Affiliates of a Brynmawr
Entity prior to such Actual Transfer shall remain Affiliates of a Brynmawr
Entity after such Actual Transfer (regardless of whether they would then
otherwise meet the definition of "Affiliate") for purposes of this Agreement
only.
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"Applicable Marginal Rate" means, at any given time, the
highest marginal tax rate for individuals under applicable federal, state and
local tax laws, assuming that the applicable tax payer(s) are residents of the
City of New York and taking into account, to the extent permitted under
applicable law, any deduction of state and local taxes from federal taxes (such
deductions being determined without regard to the limitations set forth in
section 68 of the Internal Revenue Code of 1986, as amended).
"Apollo Capital Account" means
(1) as of the day immediately following the date of consummation of the
transactions contemplated by the Transaction Agreement (herein called the "MLP
Closing Date"), an amount determined as follows: (A) $349,227,849, reduced by
(B) any Available Cash Flow (as defined in the Original Agreement) received or
deemed to have been received by the Brynmawr Entities or their Affiliates from
time to time during the period from July 1, 2001 through and including the MLP
Closing Date pursuant to Section 2.a.i. of the Original Agreement, increased by
(C) interest on the amount of such difference, from time to time, at a rate
equal to twelve percent (12%) per annum, compounded quarterly, from July 1, 2001
through and including the MLP Closing Date, and (D) reduced by $108,498,927,
and,
(2) from time to time after the MLP Closing Date, the amount of the Apollo
Capital Account shall be (A) increased by (i) the amount of any Additional
Capital Contributions made (provided that no Additional Capital Contributions
shall have been made after June 30, 2001 and prior to the day after the MLP
Closing Date), (ii) any amount to be included as an addition to the Apollo
Capital Account pursuant to Section 2.b.i., and (iii) interest at a rate equal
to twelve percent (12%) per annum, compounded quarterly, using the same
methodology and conventions used in calculating the Apollo Capital Account
balance prior to the MLP Closing Date, and (B) decreased by (i) any Acquisition
Financing and (ii) any Available Cash Flow received or deemed to have been
received by the Brynmawr Entities pursuant to Section 2.a.i of this Agreement.
"Associates" has the meaning set forth in the recitals to this
Agreement.
"Available Cash Flow" means, without duplication, the
following,
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(1) the Brynmawr Entities Allocable Percentage of any amounts (whether
cash or other assets) invested , loaned or otherwise expended, directly or
indirectly, by the Master Limited Partnership or any Inside-the-Box Entity in or
in respect of a Non-▇▇▇▇▇▇▇ Asset (and for this purpose, by way of illustration
and not limitation, an investment into a ▇▇▇▇▇▇▇ Asset such as a Net Lease
Partnership shall be deemed to be Available Cash Flow to the extent such ▇▇▇▇▇▇▇
Asset subsequently makes an investment into a Non-▇▇▇▇▇▇▇ Asset;
(2) all cash, and the fair market value of non-cash rights or benefits
received by an Outside-the-Box Entity from the Actual Transfer of all or any
portion of an interest in Master Limited Partnership (other than an Actual
Transfer described in Section 6.c.);
(3) the Brynmawr Entities Allocable Percentage of all interest and other
earnings earned on funds in excess of $60,000,000 in the aggregate held by all
Inside-the-Box Entities (whether or not such interest or other earnings are
distributed); and
(4) to the extent that it directly or indirectly is generated by or
otherwise relates to any of the ▇▇▇▇▇▇▇ Assets, the Net Lease Partnerships, the
Master Limited Partnership, any Property, or any direct or indirect interest of
any nature whatsoever in any of the foregoing, 77.14% of the aggregate of the
following:
(x) all cash, and the fair market value of non-cash rights or
benefits, direct or indirect, each from any source (including without
limitation from the Master Limited Partnership) derived by any
Outside-the-Box Entity (including, but not limited to, (i) any partnership
servicing fees, (ii) any asset management fees, (iii) any interest or
other revenue spread inuring to the benefit of any Outside-the-Box Entity
in connection with a mortgage refinancing, (iv) any fees or proceeds from
the sale or refinancing of any assets, (v) any securities and/or direct or
indirect profit sharing or other participation interests, and (vi) any
other direct or indirect benefits received by any Outside-the-Box Entity
in any transaction relating to the tender for, investment in, transfer of,
mortgaging, financing, rights offering or other action with respect to,
all or any interest in (A) any of the ▇▇▇▇▇▇▇ Assets, (B) any Net Lease
Partnership, any limited partnership interest therein or any other
interest therein (whether debt or equity), (C) any Inside-the-Box Entity,
or (D) any entity that enters into a transaction with or with respect to
any of the foregoing (including, without limitation, any direct or
indirect acquisition of indebtedness that is secured by a first mortgage
or a second mortgage on any Property or any direct or indirect interest in
such indebtedness), but specifically excluding (vii) any Acquisition
Financing), and any reduction in reserves,
less
(y) all payments by any Outside-the-Box Entity of principal and
interest on indebtedness or borrowings (including, without limitation,
Acquisition Financing), but
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only to the extent that the proceeds thereof (it being agreed that any
such payments on account of Acquisition Financing shall be included) were
included in Available Cash Flow, and expenses that are paid to
unaffiliated third parties by an Outside-the-Box Entity (including,
without limitation, any out-of-pocket costs incurred by any
Outside-the-Box Entity (such as legal costs, financing costs and due
diligence costs) that are paid to unaffiliated third parties on an
arm's-length basis by an Outside-the-Box Entity from their own funds and
not from the funds of any Inside-the-Box Entity or any general partner of
any such Net Lease Partnership (including, without limitation, expenses
incurred in connection with a transaction of the type described in clause
(vi) of clause (x) above)), except that expenses with respect to clauses
(i) and (ii) of clause (x) above shall not be deducted;
provided, however, that (I) 100% of all such cash, and the fair market value of
non-cash rights or benefits, direct or indirect, derived by an Outside-the-Box
Entity on account of any Additional Capital Contributions (including, without
limitation, distributions on account of interests in the Master Limited
Partnership received in exchange for Additional Capital Contributions and
payments of principal and/or interest on advances to the Master Limited
Partnership which constitute Additional Capital Contributions) shall be included
in Available Cash Flow, and (II) 0% of all such cash, and the fair market value
of non-cash rights or benefits, direct or indirect, derived by an
Outside-the-Box Entity on account of any additional capital contributions or
other advances which are not Additional Capital Contributions shall be included
in Available Cash Flow; provided further, however, that to the extent that
interests in the Master Limited Partnership or any other entity (whether equity,
debt or otherwise) that are received on account of assets described in clause
(II) of the foregoing proviso are effectively entitled to a return that has
priority or preference over the return to which corresponding interests in the
Master Limited Partnership or such other entity that are received on account of
assets described in clause (I) of such proviso or any other corresponding
interests in the Master Limited Partnership or any other entity are effectively
entitled, the percentages set forth in such proviso shall be equitably adjusted
so as to effectively neutralize the benefit of such priority or preference.
"Brynmawr Entities" shall mean VNK, Vornado, Vornado ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ RE, Capital, ▇▇▇▇▇▇▇ ▇▇, Associates and ▇▇▇▇▇.
"Brynmawr Entities' Allocable Percentage" means the ownership
percentage of the Outside-the-Box Entities in the Master Limited Partnership,
which shall initially be 75.72 %.
"Capital" has the meaning set forth in the recitals to this
Agreement.
"Capital Pledge and Security Agreement" means that certain
Pledge Agreement, dated November 20, 1997, by Capital in favor of Administrator,
for itself and as agent for the Selling Group.
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"Cash Participation Documents" has the meaning set forth in
Section 7.a. of this Agreement.
"Cash Purchase Participation Cap" means TWENTY EIGHT MILLION
($28,000,000) DOLLARS.
"Closing" means the consummation of the transactions
contemplated by the Purchase Agreement.
"Closing Agendas" means the closing agendas prepared by
Proskauer Rose LLP in connection with the consummation of the transactions
contemplated by the Purchase Agreement.
"Confidential Information" has the meaning set forth in
Section 5.c. of this Agreement.
"Convertible Security" means, with respect to any Person or
asset, any debt, equity, right or other interest that either (A) is convertible
into, or otherwise grants the right to acquire, an equity interest in that
Person or ownership of those assets for consideration other than cash in an
amount which is equal to or in excess of the fair market value thereof at the
time of such conversion or acquisition or (B) grants upon the owner rights that
are substantially similar to those conferred by an equity interest in that
Person or ownership of those assets (including, without limitation, equity
participations). Any consideration given for a Convertible Security shall,
subject to Section 6.b of this Agreement, be included within Available Cash Flow
at the time it is given; any consideration given upon the conversion of an
Acquisition Security or the other acquisition of the applicable Person or asset
shall, subject to Section 6.b of this Agreement, be included within Available
Cash Flow at the time it is given.
"▇▇▇▇▇" means ▇▇▇▇▇▇▇ ▇▇▇▇▇ LLC, a Delaware limited liability
company (formerly known as Brynmawr ▇▇▇▇▇ LLC).
"▇▇▇▇▇ Pledge Agreement" means that certain Pledge Agreement,
dated November 20, 1997, by of Administrator LLC, for itself and as agent for
the Selling Group, in favor of ▇▇▇▇▇.
"Fund II" has the meaning set forth in the recitals to this
Agreement.
"Fund III" has the meaning set forth in the recitals to this
Agreement.
"Fund III Pledge Agreement" means that certain Pledge
Agreement, dated November 20, 1997, by Fund III in favor of Administrator LLC,
for itself and as agent for the Selling Group.
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"Funds" has the meaning set forth in the recitals to this
Agreement.
"Future Financing Agreement" means that certain Future
Financing Agreement, dated November 20, 1997, by and among, Fund III, Holdings,
▇▇▇▇▇▇▇ ▇▇, Capital, ▇▇▇▇▇, and Administrator LLC, for itself and as agent for
the Selling Group, setting forth the terms and conditions upon which certain
security interests granted pursuant to the Pledge Agreements may be
subordinated.
"GAAP" means generally accepted accounting principles as
defined by the United States Financial Accounting Standards Board as from time
to time in effect, consistently applied (taking into account, however, any
change that, from time to time, may be made in such principles by the United
States Financial Accounting Standards Board).
"Guaranty Agreement" means, collectively, (i) the Guaranty
Agreement, dated November 20, 1997, by and among Fund II, Fund III, Holdings,
▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇, SkiKid, ▇▇▇, Capital, ▇▇▇▇▇, for the benefit of Administrator
LLC, for itself and as agent, and the Selling Group and (ii) the Guaranty
Agreement, dated as of June 30, 1998, by ▇▇▇▇▇▇▇ RE and Administrator LLC.
"Holdings" means ▇▇▇▇▇▇▇ ▇▇ Holdings LLC, a Delaware limited
liability company.
"Holdings I Pledge Agreement" means that certain Pledge
Agreement, dated November 20, 1997, by Holdings in favor of Administrator LLC,
for itself and as agent for the Selling Group, as modified by (i) that certain
Assumption Agreement, dated July 8, 1998, by and Associates, (ii) that certain
Assumption and Ratification Agreement, dated January 1, 2000, by and among
Holdings, Stock and Associates, and (iii) that certain Assumption Agreement,
dated as of the date hereof by the Master Limited Partnership.
"Holdings II Pledge Agreement" means that certain Pledge
Agreement, dated as of the date hereof, by Holdings in favor of Administrator
LLC, for itself and as agent for the Selling Group, providing for the pledge of
certain limited partnership interests of the Master Limited Partnership owned by
Holdings.
"Inside-the-Box Entity" means Master Limited Partnership and
any Affiliate of Master Limited Partnership that is controlled by Master Limited
Partnership (with control having the meaning ascribed thereto in Rule 405
promulgated under the Securities Act of 1933, as amended).
"Jess" means Jess LLC, a Delaware limited liability company.
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"Jess Pledge Agreement" means that certain Pledge Agreement,
dated November 20, 1997, by Jess in favor of Administrator LLC, for itself and
as agent for the Selling Group.
"Loan Agreement" means that certain Loan Agreement, dated
November 20, 1997, by and between ▇▇▇▇▇ and Administrator LLC pursuant to which,
among other things, the ▇▇▇▇▇▇▇ Loan was made to Administrator LLC, as the same
may have been or may be amended from time to time.
"LP Collateral" has the meaning set forth in Section 4.b.ii.
of this Agreement.
"Management Agreement" means any Partnership Administration
Agreement or Brokerage, Consulting and Financial Advisory Agreement between any
Net Lease Partnership or the Master Limited Partnership and Capital (as
successor-in-interest to ▇▇▇▇▇▇▇) in effect on November 20, 1997, as the same
may be amended from time to time in accordance with the Transaction Documents.
"Master Limited Partnership" means The ▇▇▇▇▇▇▇ Master Limited
Partnership, a Delaware limited partnership.
"MLP Pledge Agreement" means that certain Pledge Agreement,
dated the date hereof, by the Master Limited Partnership in favor of
Administrator LLC, for itself and as agent for the Selling Group.
"Net Lease Partnership" means any of the partnerships listed
on Schedule B annexed hereto.
"▇▇▇▇▇▇▇" means ▇▇▇▇▇▇▇ Limited Partnership, a Delaware
limited partnership that, simultaneously herewith, is being merged with and into
Capital.
"▇▇▇▇▇▇▇ Assets" means (i) the controlling interest that is
described in the Purchase Agreement in certain general partners of the Net Lease
Partnerships, and (ii) all of the assets, subject to all of the liabilities
reflected on Schedule C annexed hereto, of ▇▇▇▇▇▇▇, including the Management
Agreements and any deferred fees with respect thereto, subject to all
liabilities associated therewith.
"▇▇▇▇▇▇▇ Cash Participation" means the amount of the Cash
Participation evidenced by the Cash Participation Instruments described in
Sections 3.a.iii and 3.a.iv.
"▇▇▇▇▇▇▇ ▇▇ Pledge Agreement" means that certain Pledge
Agreement, dated November 20, 1997, by Brynmawr Associates LLC (predecessor of
▇▇▇▇▇▇▇ ▇▇) in favor of Administrator LLC, for itself and as agent for the
Selling Group.
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"▇▇▇▇▇▇▇ Loan" means the loan, in the original principal
amount of $40,000,000, made contemporaneously with the Original Agreement by
▇▇▇▇▇ to Administrator LLC, pursuant to the Loan Agreement.
"▇▇▇▇▇▇▇ RE Holdings Pledge Agreement" means that certain
Pledge Agreement, dated as of June 30, 1998, by ▇▇▇▇▇▇▇ RE Holdings LLC in favor
of Administrator LLC, for itself and as agent for the Selling Group.
"Non-▇▇▇▇▇▇▇ Asset" means any asset other than a ▇▇▇▇▇▇▇
Asset.
"NLP Cash Participation" means the amount of the Cash
Participation evidenced by the Cash Participation Instruments described in
Sections 3.a.i and 3.a.ii.
"Option Agreement" means that certain Put-Call Option
Agreement, dated as of January 1, 2002, among Master Limited Partnership, NK-CR
Holdings LLC and Holdings Subsidiary LLC, in the form attached hereto as Exhibit
B (regardless of whether such form is actually executed or is later amended).
"Outside-the-Box Entity" means any Brynmawr Entity or any
Affiliate of any Brynmawr Entity, that in each case is not an Inside-the-Box
Entity.
"Person" means any individual, general partnership, limited
partnership, limited liability company, trust, estate, association, corporation,
or other legal or commercial entity.
"Pledge Agreements" means the ▇▇▇▇▇▇▇ ▇▇ Pledge Agreement, the
▇▇▇▇▇▇▇ RE Holdings Pledge Agreement, the MLP Pledge Agreement, Jess Pledge
Agreement, the SkiKid Pledge Agreement, the ▇▇▇ Pledge Agreement, the Capital
Pledge and Security Agreement, the Fund III Pledge Agreement, the WEM-Brynmawr
Pledge Agreement, and the Holdings I Pledge Agreement, the Holding II Pledge
Agreement and the VNK Pledge Agreement.
"Post-Closing Adjustment Agreement" means that certain
Post-Closing Adjustment Agreement, dated November 20, 1997, by and among ▇▇▇▇▇▇▇
▇▇, Capital and Administrator LLC, as agent for the Selling Group.
"Property" means any property (real, personal or otherwise) of
any Net Lease Partnership, the Master Limited Partnership or an Inside-the-Box
Entity.
"Purchase Agreement" has the meaning set forth in recitals to
this Agreement.
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"Purchase Price" means the cash purchase price being paid by
or on behalf of the Brynmawr Entities in connection with their acquisition of
the ▇▇▇▇▇▇▇ Assets, pursuant to the Purchase Agreement (i.e., $30,000,000).
"Section 6b(i) Transfer Asset" has the meaning set forth in
the Transaction Agreement.
"Selling Group" has the meaning set forth in the recitals to
this Agreement.
"SkiKid" means SkiKid LLC, a Delaware limited liability
company.
"SkiKid Pledge Agreement" means that certain Pledge Agreement,
dated November 20, 1997, by SkiKid in favor of Administrator LLC, for itself and
as agent of the Selling Group.
"▇▇▇" means ▇▇▇ LLC, a Delaware limited liability company.
"▇▇▇ Pledge Agreement" means that certain Pledge Agreement,
dated November 20, 1997, by ▇▇▇ in favor of Administrator LLC, for itself and as
agent of the Selling Group.
"Transaction" has the meaning set forth in the recitals to
this Agreement.
"Transaction Agreement" has the meaning set forth in the
recitals to this Agreement.
"Transaction Documents" means the agreements, instruments and
other documents marked as "Transaction Documents" on the final Closing Agendas,
together with all amendments, modifications, supplements and extensions thereto
and all other agreements, instruments or other documents executed after
November, 1997 in connection therewith, and the Transaction Agreement, together
with all amendments, modifications, supplements and extensions thereto and all
other agreements, instruments or other documents executed in connection
therewith.
"VNK Pledge Agreement" means (i) that certain Pledge
Agreement, dated as of the date hereof, by VNK in favor of Administrator LLC,
for itself and as agent for the Selling Group, providing for the pledge of
certain limited partnership interests of the Master Limited Partnership owned by
VNK, and (ii) that certain Pledge Agreement, dated as of the date hereof, by
Vornado ▇▇▇▇▇▇▇ in favor of Administrator LLC, for itself and as agent for the
Selling Group, providing for the pledge of certain limited partnership interests
of The Master Limited Partnership owned by Vornado ▇▇▇▇▇▇▇.
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"WEM-Brynmawr Pledge Agreement" means that certain Pledge
Agreement, dated November 20, 1997, by WEM-Brynmawr Associates, LLC in favor of
Administrator LLC, for itself and as agent for the Selling Group.
2. Cash Participation.
a. Cash Participation. The Brynmawr Entities shall pay or
cause to be paid to Administrator LLC the aggregate amount of the cash
participation payments to be paid to Administrator LLC pursuant to this
Agreement (the "Cash Participation"). The Cash Participation shall be determined
from time to time as follows:
i. First, the Outside-the-Box Entities will receive 100%
of all Available Cash Flow until the Apollo Capital Account has been
reduced to $0, it being agreed and understood that, for purposes of this
Agreement, any cash and the fair market value of non-cash rights or
benefits, direct or indirect, specified in the definition of Available
Cash Flow, received directly or indirectly by any Outside-the-Box Entity
shall be deemed to have been received by such entity on the date each such
item is first available directly or indirectly to any such Outside-the-Box
Entity; provided, however, that (i) any cash or non-cash rights or
benefits that would otherwise be included as Available Cash Flow, but that
continue to be held by an Inside-the-Box Entity, shall not be deemed to
have been received (indirectly or otherwise) by an Outside-the-Box Entity
(a) unless such cash or non-cash rights or benefits shall have been
distributed or otherwise paid, directly or indirectly, to any holder of
equity in any Inside-the-Box Entity in its capacity or status as a holder
of equity (which holder of equity is not an Affiliate of the Brynmawr
Entities) without proportionate distributions or other payments being made
to any Outside-the-Box Entity or Inside-the-Box Entity, as appropriate, in
which case the Outside-the-Box Entities shall be deemed to have received
their proportionate distributions or other payments on the date of such
earlier distribution or other payment and (b) except that the Brynmawr
Entities Allocable Percentage of any interest or other earnings earned on
funds in excess of $60,000,000 in the aggregate held by all Inside-the-Box
Entities shall, when earned, be deemed to have been received by the
Outside-the-Box Entities (whether or not in fact so received), and (ii)
the Brynmawr Entities' Allocable Percentage of any amount of investment,
loan or expense contemplated by clause 1 of the definition of Available
Cash Flow shall be deemed to have been received by the Outside-the-Box
Entities when made and any revenues generated and/or expenses paid for or
in respect of any such investment, loan or expense shall be disregarded in
the calculation of Available Cash Flow;
ii. Second, Administrator LLC shall receive 100% of all
Available Cash Flow until Administrator LLC has received the aggregate
amount of the Cash Purchase Participation Cap; and
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iii. Thereafter, the Brynmawr Entities shall receive
100% of Available Cash Flow.
b. Additional Capital Contributions.
i. Taxes. For purposes of section 2.a, any federal,
state or local taxes to be paid by any of the Outside-the-Box Entities on
accrued but unpaid interest (and not for interest actually or deemed paid
to the Brynmawr Entities and/or their Affiliates) with respect to the
▇▇▇▇▇▇▇ Loan shall, as and when payable, be accounted for as an addition
to the Apollo Capital Account. For purposes of this section 2.b.i, it
shall be assumed that the Outside-the-Box Entities pay taxes at the
Applicable Marginal Rate.
ii. Phantom Income. For purposes of section 2.a, any
federal, state or local taxes to be paid by any of the Outside-the-Box
Entities on account of taxable income with respect to income that is not
actually received by the Outside-the-Box Entities, shall not, except as
set forth in Section 2.b.i., be included in the computation of Available
Cash Flow as an expense and shall not be accounted for as an addition to
the Apollo Capital Account.
iii. Payments on Account of Cash Participation. For
purposes of section 2.a above, payments made to Administrator LLC on
account of the Cash Participation shall not be included in the computation
of Available Cash Flow as an expense and shall not be accounted for as an
addition to the Apollo Capital Account.
c. [INTENTIONALLY OMITTED]
d. Payment of Cash Participation.
i. Estimated Payment. No later than the end of each
calendar quarter, the Brynmawr Entities shall pay or cause to be paid any
amount that they reasonably and in good faith estimate to have then
accrued and remained unpaid in respect of the Cash Participation (an
"Estimated Quarterly Payment"). Simultaneously with the making of any
Estimated Quarterly Payment, the Brynmawr Entities shall send
Administrator LLC supporting documentation showing in reasonable detail
the computation of the amount of the Estimated Quarterly Payment.
ii. Adjustment of Estimated Payment. No later than April
30 of any calendar year, the Brynmawr Entities shall send Administrator
LLC its computation of the actual amount that was accrued and remained
unpaid as of the end of the preceding calendar year (an "Actual Annual
Payment"), setting forth in reasonable detail the basis for the
computation of the Actual Annual Payment and the reasons for any
adjustment in the amount of the Estimated Quarterly Payments made in the
aggregate in respect of such calendar year. If the Actual Annual Payment
in respect of any calendar year exceeds the sum of the Estimated Quarterly
Payments made in respect of such calendar year, then the Brynmawr Entities
shall pay or cause to be paid the amount of such excess simultaneously
with the communication to Administrator LLC of the Actual Annual Payment.
If the sum of the Estimated Quarterly Payments made in respect of a
calendar year exceed the Actual Annual Payment for such year, then the
amount of such excess shall be reimbursed to a Brynmawr Entity by
Administrator LLC no later than thirty (30) days after the communication
to Administrator LLC of the Actual Annual Payment.
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iii. Method of Payment. Any payment to be made in
respect of the Cash Participation shall be made in immediately available
funds, by wire transfer or certified bank check, to Proskauer Rose LLP, as
escrow agent for the Selling Group, and shall be deemed made upon receipt
by Proskauer Rose LLP. Administrator LLC may from time to time change the
person or entity to whom any such payment is to be made. If the Brynmawr
Entities shall fail to pay any amount with respect to the Cash
Participation when due, the amount of such underpayment shall bear
interest at the rate, and there shall be a late charge in the amount, set
forth in the Cash Participation Instruments.
e. Mandatory Payment of Cash Purchase Participation Cap. To
the extent that Administrator LLC has not then been paid the full amount
of the Cash Purchase Participation Cap, the Brynmawr Entities shall pay to
Administrator LLC an amount equal to the Cash Purchase Participation Cap
less all amounts theretofore paid to Administrator LLC under Section 2 of
this Agreement (and not otherwise reimbursed under the last sentence of
Section 2.d.ii.) on the earlier to occur of (1) 120 days following the
date on which the Master Limited Partnership becomes "public", or any
Brynmawr Entity or any other Affiliate thereof whose direct or indirect
interest in the assets which give rise to or are otherwise taken into
account in determining Available Cash Flow constitutes 75% or more of such
entity's total value and that is not "public" on the date hereof becomes
"public", or (2) January 15, 2009. As used herein, any entity shall be
"public" if its securities are listed for trading on a securities exchange
(including, without limitation, the New York Stock Exchange, the American
Stock Exchange, NASDAQ, NASDAQ Small Cap, London Stock Exchange, Tokyo
Stock Exchange, or Paris Stock Exchange). Nothing contained in this
Section shall impair the applicability of Section 6 to any Actual Transfer
of Control Assets to any Brynmawr Entity or any of its Affiliates.
3. Issuance of Cash Participation Instruments.
a. Issuance of Instruments. The Brynmawr Entities' obligations
to pay the Cash Participation are evidenced by instruments in the form
annexed hereto as Exhibit C("Cash Participation Instrument(s)").
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b. Issuance of Replacement Instruments. All Cash Participation
Instruments issued pursuant to this Agreement have been and shall be
sequentially numbered. The Brynmawr Entities hereby agree to issue such
replacement Cash Participation Instruments in such denominations and to such
persons or entities as Administrator LLC may from time to time request, at no
cost or expense to Administrator LLC. The issuance of any such replacement Cash
Participation Instruments shall be made promptly upon either the surrender to a
Brynmawr Entity of the Cash Participation Instrument(s) to be replaced or a loss
affidavit substantially in the form and substance annexed hereto as Exhibit D(an
"Acceptable Loss Affidavit").
c. Aggregate Amount of Outstanding Instruments. At no time
shall there be issued and outstanding Cash Participation Instruments in excess
of the Cash Participation Cap.
4. Computation of Available Cash Flow.
a. General. For purposes of computing Available Cash Flow, any
non-cash right or benefit or other non-cash item to be included in Available
Cash Flow shall be ascribed its fair market value. The fair market value shall
be determined on a net present value basis and any dispute as to such fair
market value shall be conclusively resolved by arbitration in accordance with
Section 7 of this Agreement.
b. Excluded Items.
i. Voting Rights in Net Lease Partnerships and the
Master Limited Partnership. If at any time a Brynmawr Entity or any of
their Affiliates acquires any rights to vote any limited partnership
interest in any Net Lease Partnership or the Master Limited Partnership (a
"Voting Right"), there shall not be included in Available Cash Flow the
fair market value of that Voting Right at the time of such acquisition.
c. Certain Excluded Expenses. Notwithstanding anything to the
contrary in this Agreement, no expense incurred in connection with the defense
of any claim by Administrator LLC and/or the Selling Group shall be deducted in
calculating of Available Cash Flow if the Administrator LLC and/or the Selling
Group, as the case may be, prevails upon the claim.
5. Information to be Provided.
a. Financial Information.
i. Quarterly Information. The Brynmawr Entities shall
provide (or cause to be provided to) Administrator LLC, within forty-five
(45) days after the end of each calendar quarter, a summary description of
15
all items that are included within the computation of Available Cash Flow
(including, without limitation, borrowings included therein) and amounts
owing or not owing, as the case may be, to Administrator LLC on account of
the Cash Participation for the preceding calendar quarter and all
information (to the extent that it is in the possession, or under the
control, of the Brynmawr Entities and/or their Affiliates) relating to all
cash and non-cash rights or benefits directly or indirectly received by
the Brynmawr Entities and/or their Affiliates during the preceding
calendar quarter that relate directly or indirectly to: (A) the ▇▇▇▇▇▇▇
Assets, (B) Capital, (C) the Net Lease Partnerships, (D) the Properties,
(E) the Master Limited Partnership or (F) any entity that enters into a
transaction with or with respect to any of the foregoing. The summary
description and information shall be presented on a line item basis
showing the valuation of each such item and shall be in sufficient detail
to demonstrate the basis for the computation of any amounts owing or not
owing, as the case may be, with respect to the Cash Participation. The
summary description and information shall also be accompanied by the
certificate of the chief financial officer, president or other officer of
the Brynmawr Entities and/or their Affiliates reasonably acceptable to
Administrator LLC, that such officer has examined this Agreement and has
no knowledge, after due inquiry, of any matter or circumstance that makes
the summary description and information inaccurate or misleading in any
material respect, or, if such officer does have knowledge of any such
matter or circumstance, setting forth such matter or circumstance in
reasonable detail.
ii. Annual Information. The Brynmawr Entities shall
provide (or cause to be provided to) Administrator LLC as soon as
available, but in any event on or prior to March 31 of any calendar year,
the audited consolidated and consolidating balance sheet as at the end of
the preceding calendar year and the audited, consolidated and
consolidating statements of earnings and retained earnings and of
financial condition, prepared in accordance with GAAP, of the Brynmawr
Entities and their Affiliates insofar as they relate directly or
indirectly to: (A) the ▇▇▇▇▇▇▇ Assets, (B) Capital, (C) the Net Lease
Partnerships, (D) the Properties, (E) the Master Limited Partnership, or
(F) any entity that enters into a transaction with or with respect to any
of the foregoing. Such balance sheet and statements shall be prepared by
the regularly employed certified public accountants of such entities and
be accompanied by (A) the report or certificate of any such accountant
without qualification as to the auditing standards used in the performance
of its audit, and (B) the certificate of the chief financial officer,
president or other officer of the Brynmawr Entities and/or its Affiliates
reasonably acceptable to Administrator, that such officer has examined
this Agreement and has no knowledge, after due inquiry, matter or
circumstance that makes the accompanying audited balance sheet and
financial statements inaccurate or misleading in any material respect, or,
if such officer does have knowledge of any such matter or circumstance,
setting forth such matter or circumstance in reasonable detail.
16
b. Other Information. The Brynmawr Entities shall provide
Administrator LLC with copies of: (A) any information provided to the owners of,
or investors in, any of the Brynmawr Entities and/or their Affiliates
simultaneously with the provision thereof to such owners or investors in respect
of, or directly or indirectly relating to, the ▇▇▇▇▇▇▇ Assets, the Net Lease
Partnerships, the Properties, the Master Limited Partnership, or the
transactions contemplated by the Purchase Agreement and (B) any correspondence
to any limited partner of any Net Lease Partnership or of the Master Limited
Partnership simultaneously with the sending thereof. Administrator LLC and its
advisors shall, from time to time, be afforded access upon reasonable notice and
during normal business hours to the books and records of the Brynmawr Entities
and their Affiliates to the extent that they may be relevant to the ▇▇▇▇▇▇▇
Assets, the Net Lease Partnerships, the Properties, any Inside-the-Box Entity,
the general partners thereof or the assets of the foregoing (including, without
limitation, the Cash Purchase Participation); provided, however, that the
Brynmawr Entities shall not be obligated to afford such access on more than four
occasions per year. The Brynmawr Entities shall also, upon reasonable notice,
make available for reasonable periods those persons who are familiar with the
requested information to Administrator LLC in order to answer such questions as
Administrator LLC may have from time to time. The Brynmawr Entities shall
provide to Administrator LLC notice of any adjustment in the Brynmawr Entities
Allocable Percentage and a description in reasonable detail of the reasons for
such adjustment, together with such supporting documentation as may be
reasonably requested by Administrator LLC.
c. Confidentiality. Any information provided to Administrator
LLC and/or the Selling Group pursuant to Section 5.b of this Agreement
("Confidential Information") shall be kept in strictest confidence by
Administrator LLC and the Selling Group and shall be used by the Administrator
LLC and/or Selling Group and their representatives solely for purposes of
ensuring that the Brynmawr Entities are in compliance with this Agreement and
enforcing the rights of Administrator LLC and/or the Selling Group hereunder.
Administrator LLC and the Selling Group shall be entitled to disclose such
information (A) to each other and their professional advisors and/or (B) in
connection with any proceeding to enforce any right hereunder. For purposes of
this Agreement, Confidential Information shall not include information that (i)
becomes or has been generally available to the public other than as a result of
a disclosure by the Administrator LLC and/or Selling Group after the date of
this Agreement, (ii) was available to Administrator LLC and/or the Selling Group
or any member thereof on a non-confidential basis prior to its disclosure to
Administrator LLC and/or the Selling Group by a Brynmawr Entity or any of their
respective representatives, or (iii) becomes available to Administrator LLC
and/or the Selling Group on a non-confidential basis from a source other than
the Brynmawr Entities or any of their respective representatives.
Notwithstanding the foregoing, in the event that Administrator LLC and/or the
Selling Group or any member or representative thereof becomes legally compelled
to disclose any Confidential Information, prompt written notice shall be
provided to the Brynmawr Entities, so that a protective order or other
appropriate remedy may be sought, or a waiver of compliance with this Section
5.c may be given. In the event that such a protective order or other remedy
either is not obtained or that compliance with the provisions of this Section
5.c is not waived, Administrator LLC and/or the Selling Group will furnish only
that portion of the Confidential Information which is legally required and will
exercise its reasonable efforts (without any requirement that it incur any cost
or expense) to obtain reliable assurance that the Confidential Information will
be accorded confidential treatment.
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6. Effect of Certain Transfers.
a. Transfer of Control Assets. Without limiting any other
provision of this Agreement or any other Transaction Document, subject to
Section 6.d. of this Agreement, in the event that there shall be a direct or
indirect Actual Transfer of (i) any interest in any general partner of a Net
Lease Partnership, (ii) ▇▇▇▇▇ (and/or any interest therein), (iii) a Brynmawr
Entity (and/or any interest therein), (iv) any interest in the Master Limited
Partnership or any other Inside-the-Box Entity, which interest was held by a
Brynmawr Entity or any Affiliate thereof, (v) the general partner of the Master
Limited Partnership or any interest in such general partner, (vi) any Affiliate
(and/or any interest therein) having a direct or indirect interest in any of the
foregoing and/or (v) any other asset with respect to which any cash or non-cash
right or benefit or any expense is includable within the computation of
Available Cash Flow (collectively, "Control Assets"), then:
i. all consideration directly or indirectly received by
the Brynmawr Entities, the owners of any of the Brynmawr Entities and/or
any of their respective Affiliates (whether or not deferred, whether in
the form of cash or non-cash rights or benefits, or otherwise) on account
of such Actual Transfer from any source derived, shall be valued in
accordance with Section 4 and included within the computation of Available
Cash Flow pursuant to this Agreement, but only to the extent that it
relates directly or indirectly to assets with respect to which any cash or
non-cash right or benefit or any expense is includable within the
computation of Available Cash Flow;
ii. any future Available Cash Flow with respect to any
of the Control Assets not subject of the Actual Transfer received by the
Brynmawr Entities shall continue to be applied to the Cash Participation
in accordance with the terms of this Agreement; and
iii. all duties, liabilities or other obligations of the
Brynmawr Entities and/or their respective Affiliates under this Agreement
shall remain in full force and effect (irrespective of whether the
transferee under such Actual Transfer sells any Control Assets to another
Person), and, if the Actual Transfer involves a sale of the Brynmawr
Entities, the Funds shall be primarily liable with respect to such
obligations.
b. Transfer To Affiliates. Notwithstanding anything in this
Agreement or any other Transaction Document to the contrary, but subject to
Section 6.c. below, in the event that the Brynmawr Entities or their Affiliates
propose to make a direct or indirect Actual Transfer of any Control Asset to any
Person that is an Affiliate of any of the Brynmawr Entities, then the Brynmawr
Entities shall give Administrator LLC at least fifteen (15) days prior written
notice of any such Actual Transfer describing in reasonable detail the proposed
transferee and the terms of the Actual Transfer. Administrator LLC may, within
ten (10) days after receipt of such notice, irrevocably opt either to have such
Actual Transfer treated as:
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i. an independent, outright transfer to a person not
affiliated with the Brynmawr Entities (in which case, without limiting the
other provisions relating to the computation of Available Cash Flow, the
purchase price and/or all other consideration payable to the transferor
with respect to such Actual Transfer shall be included within Available
Cash Flow and no other revenues from the assets that are the subject of
the Actual Transfer shall be included within Available Cash Flow unless
such revenues are included within the purchase price and/or other
consideration); or
ii. as not constituting a transfer for purposes of the
computation of Available Cash Flow (in which case, without limiting other
provisions relating to the computation of Available Cash Flow, (A) none of
the purchase price or other consideration payable to the transferor with
respect to such Actual Transfer shall be included within Available Cash
Flow which will continue to be computed as if such Actual Transfer had not
occurred and (B) the Brynmawr Entities shall cause the transferee to
execute either an assumption of this Agreement and such other
documentation (including security documentation of the type and scope of
the Capital Pledge Agreement) as the Administrator LLC may reasonably
require).
In the event that Administrator LLC does not timely make an
election with respect to the treatment of an Actual Transfer under this
sub-section 6.b, it shall be deemed to have opted for the treatment set forth in
sub-clause (ii) of this Section 6.b.
c. Special Transfers.
i. Section 6.b. shall not apply to (1) any Actual
Transfer of a Control Asset from any Inside-the-Box Entity that is a direct or
indirect wholly-owned subsidiary of Master Limited Partnership to any other
Inside-the-Box Entity that is a direct or indirect wholly-owned subsidiary of
Master Limited Partnership or (2) any Actual Transfer of a Control Asset from
any Outside-the-Box Entity to any other Outside-the-Box Entity provided that the
ultimate beneficial ownership of both of such entities is identical and the
conditions set forth in clause (B) of Section 6.b.ii. have been satisfied.
ii. In the event of a merger of any Net Lease
Partnership listed on Schedule B hereto with and into a wholly-owned
Inside-the-Box Entity, Administrator LLC shall be deemed to have opted for the
treatment set forth in sub-clause (ii) of Section 6.b.
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iii. The provisions of Sections 6.a. and 6.b. shall not
apply to the issuance or transfer of interests in Vornado Realty L.P. or Vornado
Realty Trust so long as neither the issuance nor the transfer of such interests,
together with all other issuances and transfers which have been exempted from
Section 6.a.or 6.b. by operation of this sentence, does not result in any person
or group becoming the beneficial owner of 100% of the interests in Vornado
Realty L.P. or Vornado Realty Trust (or such lesser percentage as would enable
such person or group (other than Vornado Realty Trust in the case of Vornado
Realy, L.P.) to cause a "short-form" merger or to otherwise "squeeze out" the
minority interest holders under applicable state law). For purposes of this
clause (iii), (A) "person" and "group" shall have the meanings used in Section
13(d) of the Securities Exchange Act of 1934, as amended, and (B) "beneficial
owner" and "beneficial ownership" shall have the meanings set forth in Rules
13d-3 and 13d-5 of the Securities Exchange Act of 1934, as amended. The
foregoing provisions of this clause 6.c.iii. shall not preclude the
applicability of Sections 6.a and 6.b (which sections shall apply) in the case
of a merger of Vornado Realty L.P. or Vornado Realty Trust into another entity
or a reverse merger of another entity into Vornado Realty L.P. or Vornado Realty
Trust where the beneficial owners of the other entity become the beneficial
owners of 66 2/3% or more of the interests of Vornado Realty L.P. or Vornado
Realty Trust, as the case may be.
d. [Intentionally Omitted]
e. Certain Actual Transfers.
i. Notwithstanding anything to the contrary contained
herein, an Actual Transfer of a Control Asset shall be deemed to have occurred
upon the sooner to occur of (a) the exercise of the option granted to the Master
Limited Partnership to acquire an ownership interest in T-Two Partners L.P. or
the first date on which such option is exercisable pursuant to the Option
Agreement, whichever occurs first, and (b) the exercise of the option granted to
T-Two Partners L.P. to cause the Master Limited Partnership to acquire an
ownership interest in NK-CR Holdings LLC or the first date on which such option
is exercisable pursuant to the Option Agreement, whichever occurs first. For
purposes of calculating Available Cash Flow, the value deemed received at such
time pursuant to such Option Agreement shall be the "T-2 Value" as such term is
defined in Section 1.04 of the Option Agreement, provided, however that in
determining the T-2 Value for purposes of this Agreement, (1) the outstanding
balance of the Grantor Trust T-1 Certificate referred to in clause (B)(1) of
Section 1.04(b) of the Option Agreement shall be the balance that would be
outstanding assuming that all amounts received as payments on or with respect to
the Contract Receivables were applied to the Grantor Trust T-1 Certificate to
the extent contemplated under the Grantor Trust Agreement (whether or not such
amounts were actually so applied), except to the extent that any such amounts
that were not so applied were received by an Outside-the-Box Entity and
constituted Available Cash Flow that reduced the Apollo Capital Account, and (2)
any liabilities of T-Two Partners that did not constitute Available Cash Flow or
otherwise reduce the Apollo Capital Account shall not be included for purposes
of clause (B)(3) of Section 1.04(b) of the Option Agreement.
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ii. For purposes of this Section 6, an Actual Transfer
of a Control Asset from an entity controlled directly or indirectly by either of
the Funds to an entity controlled directly or indirectly by Vornado, shall be an
Actual Transfer of the type that triggers Section 6.b.
7. Dispute Resolution.
a. Arbitration. Any dispute or controversy arising under or in
connection with this Agreement, any Cash Participation Instrument or any
Acceptable Loss Affidavit (collectively, the "Cash Participation Documents"),
shall be settled exclusively by arbitration to be held in the City of New York
in accordance with the rules of the American Arbitration Association then in
effect. There shall be one arbitrator appointed in accordance with those rules.
Subject to Section 7.c. of this Agreement, as part of his award, the arbitrator
shall make a fair allocation between the parties of the fee and expenses of the
American Arbitration Association and the cost of any transcript, taking into
account the merits of their claims and defenses. The arbitrator shall render his
award within thirty (30) days after the commencement of the arbitration;
provided, however, no failure on the part of the arbitrator to render his award
within such thirty (30) day period shall constitute a release from liability of
any party hereto. Failure by either party to submit to arbitration under this
Section 7.a shall result in the arbitrator ruling in favor of the other party if
such other party has submitted to arbitration under this Section 7.a. Judgment
may be entered on the arbitrator's award in any court having jurisdiction, and
the parties irrevocably consent to the jurisdiction of the New York courts for
that purpose. The arbitrator may grant injunctive or other relief. Nothing in
this Section 7.a shall preclude any party from seeking temporary injunctive
relief from a court of competent jurisdiction pending appointment of an
arbitrator pursuant this Section 7.a.
b. Baseball Arbitration. In connection with any arbitration
under Section 7.a hereof, to the extent that the subject of the arbitration is
the determination of an amount that is due by any Brynmawr Entity, on the one
hand, or Administrator LLC and/or the Selling Group, on the other, to the other,
each party shall submit to the arbitrator its estimate of such amount within ten
(10) days after the appointment of the arbitrator (with all Brynmawr Entities
being one party for purposes of this Section 7). The arbitrator shall be charged
solely with determining, within ten (10) days after expiration of the period
during which the parties are to submit their respective estimates, which
estimate is closest to the amount that is due and shall award the amount of that
estimate to the party to whom it is due; except that, if the larger of the two
estimates is equal to or less than 120% of the smaller of the two estimates, the
amount to be awarded by the arbitrator shall be the average of the two
estimates. No failure on the part of the arbitrator to render his award within
such ten (10) day period shall constitute a release from liability of any party
hereto. If either the Administrator LLC and/or the Selling Group, on the one
hand, or the applicable Brynmawr Entities, on the other, fail to timely submit
an estimate under this Section 7.b, the estimate of the other party shall be
awarded by the arbitrator to the party to whom it is due.
21
c. Expenses of Arbitration. With respect to any arbitration
under the Section 7 of this Agreement, the non-prevailing parties shall pay all
out-of-pocket costs and expenses of the prevailing parties incurred in
connection with such arbitration.
8. General.
a. Liabilities; Security Interest; Guarantee. All duties,
obligations and liabilities of the Brynmawr Entities under any Cash
Participation Document shall be joint and several. Such duties, obligations and
liabilities are secured by one or more security interests granted to the
Administrator LLC, for itself and as agent for the Selling Group, pursuant to
the Pledge Agreements and are the subject of the Guaranty Agreement.
b. No Offset. No Brynmawr Entity shall have any right of
offset for any default, breach or other non-performance of any obligation under
the Loan Agreement, the Note (as defined in the Loan Agreement), the Tri-Party
Agreement, or the Pledge Agreement (as defined in the Loan Agreement)
(collectively, the "Loan Documents"), including, without limitation, the
non-payment of any principal of, or interest on, the ▇▇▇▇▇▇▇ Loan. Accordingly,
all amounts payable in respect of any Cash Participation Document shall be paid
in full without any deduction or offset on account of any default, breach or
other non-performance of any obligation under any Loan Documents (including,
without limitation, the non-payment of any principal of, or interest on, the
▇▇▇▇▇▇▇ Loan).
c. Non-Recourse Against Certain Persons. Notwithstanding
anything to the contrary contained in this Agreement or any other Transaction
Document or any other document referred to herein or therein, recourse for any
breach of any and all obligations and duties under any Cash Participation
Document by the Selling Group and/or Administrator LLC shall be had against only
(i) Administrator or the individuals of the Selling Group listed on Schedule E
attached hereto with respect to any obligations or liabilities of Administrator
or (ii) the individuals of the Selling Group listed on Schedule E attached
hereto with respect to any obligations or liabilities of the Selling Group or
any individual of the Selling Group. Each of the individuals of the Selling
Group listed on Schedule E attached hereto shall be jointly and severally liable
for any and all obligations and duties of the Selling Group and/or Administrator
LLC under any Cash Participation Document. The Brynmawr Entities hereby agree
that the individuals of the Selling Group who are not listed on Schedule E shall
not be liable for any of the obligations or duties under any Cash Participation
Document, and shall be absolved of any and all liabilities for any and all
breaches under such documents by the Selling Group or any individual of the
Selling Group.
9. Miscellaneous.
a. Further Assurances. At any time, and from time to time
after the date hereof, each of the parties hereto shall, without further
consideration and at their own cost and expense, execute and deliver such
additional agreements, instruments, documents or certificates, and take such
further action, as shall reasonably be requested by any other party in order to
carry out the provisions of this Agreement.
22
b. NO PARTNERSHIP. NOTHING IN THIS AGREEMENT OR ANY OTHER CASH
PARTICIPATION DOCUMENT SHALL BE INTERPRETED OR CONSTRUED AS CREATING ANY
PARTNERSHIP OR JOINT VENTURE AMONG ANY OF THE PARTIES HERETO.
c. Partial Invalidity. If any provision of this Agreement or
any other Cash Participation Document, or the application thereof to any
particular party or circumstance, shall to any extent be invalid or
unenforceable, the remainder of this Agreement or such other Cash Participation
Document, or the application of such provision to any other particular party or
circumstance, shall not be affected thereby and each remaining provision of this
Agreement, or the application of such provision to any particular party or
circumstance, shall be valid and enforceable.
d. Notices. Any notice, demand, request or other communication
required or permitted to be made under this Agreement or any other Cash
Participation Document shall be in writing and shall be considered given (i)
when sent by telecopier, receipt confirmed, (ii) when delivered personally, or
(iii) one business day after being delivered by a nationally recognized
overnight delivery service, in each case to the parties at the following
addresses:
If to a Brynmawr Entity, at:
c/o Winthrop Financial Services
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
and
Vornado Realty Trust
▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
23
with a copy to:
Rosenman & Colin LLP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇▇
and
Apollo Advisors, L.P.
1999 Avenue of the Stars, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
General Counsel
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
and
▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇, Esq.
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
If to either Administrator LLC or the Selling Group, at:
Administrator LLC
c/o Millennium Capital Management LLC
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇ ▇▇▇▇▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
and:
Administrator LLC
c/o Proskauer Rose LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
24
with a copy to:
Proskauer Rose LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
However, the parties hereto shall have the right, from time to time
and at any time, to change their respective addresses, and each shall have the
right to specify any other person and/or address in the United States of America
by at least ten (10) days' prior written notice to the other party.
e. Successors and Assigns; Assignment. This Agreement and the
other Cash Participation Documents shall be binding upon and inure to the
benefit of the parties hereto and their respective heirs, personal
representatives, successors and assigns. Each party to this Agreement or the
other Cash Participation Documents may assign all or any portion of its interest
hereunder or thereunder, provided that (i) each assignment shall expressly be
made subject to the provisions of this Section 9.e and (ii) simultaneously with
such assignment, the assignee shall expressly assume all duties, obligations and
liabilities relating to the assigned interests. The assignee shall execute,
acknowledge (when applicable) and deliver to each other party to this Agreement
and the other Cash Participation Documents an agreement whereby the assignee (x)
assumes all obligations, duties and liabilities of the assigning party to the
extent of the interest being assigned pursuant to such assignment, (y) to the
extent of the interest being assigned, agrees to be personally bound by and upon
all covenants, agreements, terms, provisions and conditions hereof on the part
of the assigning party to be performed or observed, and (z) agrees that the
provisions of this Section 9.e shall continue in full force and effect and be
binding upon the assignee. Any assignment of interests in this Agreement or any
other Cash Participation Document made without full compliance with the
preceding sentence shall be null and void for all purposes. Notwithstanding
anything contained herein, in any other Transaction Document or any document
referred to herein or therein or contemplated hereby or thereby (including
without limitation, the assumption requirements of the second sentence of this
Section 9.e), in no event shall any assignment by any party hereto of its
interests (or any part thereof) under this Agreement or any other Cash
Participation Document (i) modify or limit any right or power of any other party
hereunder or thereunder or (ii) affect or reduce any obligation, duty or
liability of the assigning party, and all obligations, duties and liabilities of
the assigning party under this Agreement or such other Cash Participation
Document shall continue in full force and effect as obligations, duties and
liabilities of a principal and not of a guarantor or surety, enforceable against
the assigning party as a principal, as though no assignment or assumption had
been made. Nothing in this Section 9.e shall be construed to modify the
non-recourse provisions of Section 8 of this Agreement.
25
f. Governing Law. IN ALL RESPECTS, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT AND THE OBLIGATIONS
ARISING UNDER THIS AGREEMENT OR ANY OTHER CASH PARTICIPATION DOCUMENT SHALL BE
GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE,
WITHOUT REGARD TO THE PRINCIPLES THEREOF REGARDING CONFLICT OF LAWS, AND ANY
APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
g. Entire Agreement. This Agreement, together with the other
Cash Participation Documents and the Transaction Agreement, embody the entire
agreement and understanding between the parties hereto relating to the subject
matter hereof and thereof and supercedes all prior agreements and understandings
to the extent that it relates to such subject matter, and it is agreed that
there are no terms, understandings, representations, or warranties, express or
implied, other than those set forth herein and therein.
h. Marshalling of Assets; Subrogation. Each Brynmawr Entity
hereby waives any right or claim of right to cause a marshalling of their
assets. No right of subrogation, reimbursement or contribution, whether arising
by contract or operation of law (including, without limitation, any such right
arising under the United States Bankruptcy Code, title 11 of the United States
Code 11 U.S.C. ss.ss.101 et seq., and successor statute) or otherwise by reason
of any payment by it pursuant to the provisions of this Agreement, shall be
asserted by a Brynmawr Entity until all of the obligations of the Funds, the
Brynmawr Entities and their respective Affiliates under the Transaction
Documents have been fully satisfied.
i. No Waiver. No failure or delay on the part of any party
hereto in exercising any right, power or privilege under this Agreement or any
other Cash Participation Document and no course of dealing between the parties
hereto shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, power or privilege under this Agreement or any other Cash
Participation Document or thereby preclude any other or further exercise thereof
or the exercise of any other right, power or privilege hereunder or thereunder.
The rights, powers and remedies under this Agreement or any other Cash
Participation Document expressly provided are cumulative with and not exclusive
of any rights, powers or remedies which any party hereto would otherwise have.
No notice to or demand on any party hereto in any case shall, ipso facto,
entitle such party to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the other party to any
other or further action in any circumstances without notice or demand where
notice or demand is not otherwise required.
j. No Oral Modification. This Agreement and any other Cash
Participation Document shall not be changed, waived, discharged or terminated
unless such change, waiver, discharge or termination is in writing and signed by
each of the parties hereto or thereto.
26
k. Release. Any party liable under or in respect of this
Agreement any other Cash Participation Document or any other Transaction
Document or any document referred to herein or therein or contemplated hereby or
thereby may be released without affecting the liability of any party not so
released.
l. No Third Party Beneficiary. This Agreement and each other
Cash Participation Document is for the purpose of defining the respective rights
and obligations of the parties hereto and thereto and is not for the benefit of
any creditor or other third party, except for the Selling Group and as otherwise
may be expressly set forth herein or thereto.
m. Gender. All pronouns and any variations of pronouns in this
Agreement or any other Cash Participation Document shall be deemed to refer to
the masculine, feminine, or neuter, singular or plural, as the identity of the
parties may require. Whenever the terms herein are singular, the same shall be
deemed to mean the plural, as the identity of the parties or the context
requires and vice versa.
n. Captions. The captions or titles given to any provision of
this Agreement are for convenience and reference only and shall in no way
define, limit or describe the scope or intent of this Agreement and in no way
affect or constitute a part of this Agreement.
o. Schedule and Exhibits. All schedules and exhibits attached
hereto are hereby incorporated herein by this reference and made a part hereof
for all purposes.
p. Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall constitute a duplicate original, but all of
which together shall constitute one and the same instrument.
10. Effective Date. This Agreement shall be effective on and as of
the date on which the Transaction (as such term is defined in the Transaction
Agreement) is consummated; provided, however, this Agreement shall automatically
(and without the necessity of any action by the parties) terminate and cease to
have any force or effect if the Transaction does not occur by March 31, 2002.
[END OF TEXT]
27
[EXECUTION PAGE]
IN WITNESS WHEREOF, the undersigned have executed or caused to be
executed on their behalf this Agreement as of the date first above written.
▇▇▇▇▇▇▇ ▇▇ LLC ▇▇▇▇▇▇▇ CAPITAL LLC
By: ▇▇▇▇▇▇▇ Manager Corp. By: ▇▇▇▇▇▇▇ Manager Corp.
Manager Manager
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------- --------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Executive Vice President Executive Vice President
▇▇▇▇▇▇▇ ASSOCIATES LLC ▇▇▇▇▇▇▇ RE ASSOCIATES LLC
By: ▇▇▇▇▇▇▇ Manager Corp. By: ▇▇▇▇▇▇▇ Manager Corp.
Manager Manager
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------- --------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Executive Vice President Executive Vice President
▇▇▇▇▇▇▇ STOCK LLC VORNADO REALTY L.P.
By: ▇▇▇▇▇▇▇ Manager Corp.
Manager
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------- --------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Executive Vice President Executive Vice President
Finance and Administration
VORNADO ▇▇▇▇▇▇▇ L.L.C. VNK CORP.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇ By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------- --------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Executive Vice President Executive Vice President
Finance and Administration Finance and Administration
ADMINISTRATOR LLC
By /s/
-------------------------
Name:
Title:
28
SCHEDULE A
Selling Group
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ Kes Narbutas
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
29
SCHEDULE B
Net Lease Partnerships
21AT Alake Albeau
▇▇▇▇▇ ▇▇▇▇▇ Altenn
▇▇▇▇▇▇ Ateb Autolane
Avrem Basot Bedcar
Bessomac Bethplain Bluff
Boford Bradall Buck Valley
Calane Calcraf Camfex
Carlane Caroldale Carolion
Cenland Clamarsh Clifmar
Colane Crostex Croydon
Dalhill Dautec Daytower
Denport Denville Eastgar
Elport Elway FedData
Flamont Gamma Gersant
Gocar Guyon Harpard
Hazelport ▇▇▇▇▇▇▇ St. Jaclane
Jacway Jameslane Jayal
JLE Way ▇▇▇▇▇ Jermor
Johab JVF Kalan
LCB Lando Lanmar
Larloosa ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Ave.
Liroc Lybster Mainbor
Marbax Martall Maxam
Melcal Merday Meredem
Mesa Midlem Montal
Nevit Newal Olo
Orper Paycap Plecar
Pinmar Pinole Porto
Redwash Renex Renlake
Reppoc Rotale Sablemart
Sajos Salistown Sandnord
Santex Scribe Segair
▇▇▇▇▇▇▇ Silward Simval
Skoob Spokmont Statmont
Sunway Supergar Superline
Superwest Suteret Syrcar
▇▇▇▇▇ ▇▇▇▇▇▇▇ Vegpow
Vegrouge Vengar Walando
Walcreek Waldrest Walmad
Walstaff Washtex Wybanco
SCHEDULE C
Certain Liabilities
SCHEDULE D
[Intentionally Omitted]
SCHEDULE E
Protecting Partners
▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A
Consent Solicitation Statement
Intentionally Omitted
EXHIBIT B
Option Agreement
Intentionally Omitted
EXHIBIT C
Form of Cash Participation Instrument
PAYMENT OF THIS INSTRUMENT IS SECURED
PURSUANT TO THE PLEDGE AGREEMENTS
REFERRED TO BELOW AND IS GUARANTEED
PURSUANT TO THE GUARANTY AGREEMENT REFERRED TO BELOW.
NON-NEGOTIABLE CASH PARTICIPATION INSTRUMENT
$________________ _____________ ___, 2001
Cash Participation Instrument No. ____
For value received, ▇▇▇▇▇▇▇ ▇▇ LLC (formerly known as Brynmawr
Associates LLC), a Delaware limited liability company ("▇▇▇▇▇▇▇ ▇▇"), ▇▇▇▇▇▇▇
Capital LLC (formerly known as Brynmawr Capital LLC), a Delaware limited
liability company ("Capital"), ▇▇▇▇▇▇▇ RE Associates LLC, a Delaware limited
liability company ("▇▇▇▇▇▇▇ RE"), ▇▇▇▇▇▇▇ Stock LLC ("Stock"), a Delaware
limited liability company, and ▇▇▇▇▇▇▇ Associates LLC ("Associates"), a Delaware
limited liability company, each having an office located at c/o Winthrop
Financial Services, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, and Vornado Realty L.P., a Delaware limited partnership
("Vornado"), Vornado ▇▇▇▇▇▇▇ L.L.C. , a Delaware limited liability company
("Vornado ▇▇▇▇▇▇▇"), and VNK Corp., a Delaware corporation ("VNK"), each having
an office located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (▇▇▇▇▇▇▇ ▇▇,
Capital, ▇▇▇▇▇▇▇ RE, Stock, Vornado, Vornado ▇▇▇▇▇▇▇ and VNK being,
collectively, the "Obligors"), do hereby, jointly and severally, promise to pay
to the order of Administrator LLC, as agent, having an address located at ▇/▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, all
amounts owing, from time to time, in the aggregate amount of ___________________
in respect of the Cash Participation described in that certain Amended and
Restated Cash Participation Agreement, dated December ___, 2001, by and among
Obligors and Administrator LLC, for itself and as agent for the persons the
persons listed on Schedule A thereto (the "Cash Participation Agreement"). All
capitalized terms used, but not otherwise defined, in this instrument shall have
the meaning set forth in the Cash Participation Agreement.
Without limiting the foregoing, to the extent that Administrator LLC
has not then been paid the full amount of ______________________, the Obligors
shall pay to Administrator LLC an amount equal to _________________________ less
all amounts theretofore paid to Administrator LLC under Section 2 of the Cash
Participation Agreement (and not otherwise reimbursed under the last sentence of
Section 2.d.ii. of such agreement) on the earlier to occur of
(1) 120 days following the date on which the Master Limited Partnership becomes
"public", or any Brynmawr Entity or any other Affiliate thereof whose direct or
indirect interest in the assets which give rise to or are otherwise taken into
account in determining Available Cash Flow constitutes 75% or more of such
entity's total value and that is not "public" on December ___, 2001 becomes
"public", or (2) January 15, 2009. As used herein, any entity shall be "public"
if its securities are listed for trading on a securities exchange (including,
without limitation, the New York Stock Exchange, the American Stock Exchange,
NASDAQ, NASDAQ Small Cap, London Stock Exchange, Tokyo Stock Exchange, or Paris
Stock Exchange).
This instrument is one of the instruments referred to as "Cash
Participation Instruments" in the Cash Participation Agreement. This instrument
has been issued in substitution of a Cash Participation Instrument in like
amount issued on or about November 20, 1997. Any payment made in respect of this
instrument shall be made simultaneously, and on a pari passu basis with, the
other Cash Participation Instruments issued under the Cash Participation
Agreement.
This instrument and the other Cash Participation Instruments
referred to in the Cash Participation Agreement are (i) secured by a security
interest in certain assets, in accordance with and subject to the terms and
conditions of certain of the Pledge Agreements referred to therein, and (ii)
guaranteed by certain Affiliates of Obligors pursuant to the Amended and
Restated Guaranty Agreement, dated as of ______, 2001. The Amended and Restated
Guaranty Agreement is secured, among other things, by the certain of the Pledge
Agreements referred to in the Cash Participation Agreement.
The holder hereof shall not by any act, delay, commission, failure
to act, or otherwise be deemed to have waived any right, power, privilege or
remedy hereunder, and no waiver whatever shall be valid unless in writing signed
by the holder hereof, and then only to the extent therein set forth; nor shall
any single or partial exercise of any right, power, privilege or remedy
hereunder preclude any further exercise thereof or the exercise of any other
right, power, privilege or remedy. The rights and remedies herein provided are
cumulative and not exclusive of any rights or remedies provided by law and may
be exercised singly or concurrently. A waiver by the holder hereof of any right
or remedy under the terms of this instrument, on any one occasion, shall not be
construed as a bar to any right or remedy which the holder would otherwise have
had on any future occasion. No executory agreement unless in writing and signed
by the holder, and no course of dealing between Obligors, endorser(s) or
guarantor(s) hereof and the holder shall be effective to change or modify or
discharge in whole or in part, this instrument.
Any payment made in respect of this instrument shall first be
applied to interest accrued with respect to this instrument, if any, and
thereafter to payments owing in respect of the Cash Participation as it relates
to this instrument.
The Cash Participation Agreement provides that any amount that shall
have accrued and remain unpaid in respect of a calendar quarter shall be paid by
the end of such calendar quarter. Interest shall accrue on any amount that is
not paid when due under the Cash Participation Agreement at a rate equal to the
lower of (i) fifteen (15%) percent per annum or (ii) the maximum rate permitted
by law, and any such interest shall be computed from the date when such payment
became overdue to the date such non-payment is cured.
In addition, if any payment hereunder is not made when due under the
Cash Participation Agreement, a late charge of one (1%) percent of each payment
so overdue may be charged by the holder for the purpose of defraying the
expenses incident to handling such delinquent payment to the extent such payment
is then permitted by law.
Obligors may prepay this instrument at any time in whole or in part
by paying the entire amount of the unpaid Cash Participation Cap, as it relates
to this instrument, together with any interest accrued thereon, without any
further prepayment penalty, premium or similar charge; and thereafter there
shall be no prepayment penalty, premium or similar charge.
Any notice, request, demand or communication to the holder shall be
deemed effective only if in writing and shall be considered given when (a) sent
by telecopier, with receipt confirmed, (b) delivered personally, and (c) one
business day after being sent by recognized overnight courier to the addressee
set forth in the Cash Participation Agreement.
This instrument is subject to the Cash Participation Agreement
(including, without limitation Section 7 thereof with respect to the resolution
of disputes). All parties in interest to this instrument, whether maker,
guarantor or endorser, if any, waive presentment for payment, notice of
dishonor, protest, notice of protest of this instrument or other notice of any
kind and all demands whatsoever.
This instrument is non-negotiable. The holder hereof may assign and
transfer this instrument and may deliver all or any part of any collateral
security held in connection herewith to any transferee that is permitted under
the Cash Participation Agreement, who shall thereupon become vested with all the
rights, powers and privileges, and duties, obligations and liabilities of the
holder with respect to any collateral security transferred or any guarantee
given and the holder shall thereafter be forever released and discharged of and
from any and all liability or responsibility to Obligors for and on account of
any collateral security so delivered.
This instrument shall be governed and construed in accordance with
the laws of the State of New York.
If any provision of this instrument, or the application thereof to
any particular party or circumstance, shall to any extent be invalid or
unenforceable, the remainder of this instrument, or the application of such
provision to any other particular party or circumstance, shall not be affected
thereby and each remaining provision of this instrument, or the application of
such provision to any particular party or circumstance, shall be valid and
enforceable.
This instrument may not be changed or terminated orally, but only by
a writing signed by the holder hereof.
[END OF TEXT]
[EXECUTION PAGE FOR CASH PARTICIPATION INSTRUMENT]
IN WITNESS WHEREOF, the undersigned have each caused this instrument
to be executed on their behalf as of the date first above written.
▇▇▇▇▇▇▇ ▇▇ LLC
▇▇▇▇▇▇▇ RE ASSOCIATES LLC
▇▇▇▇▇▇▇ STOCK LLC
▇▇▇▇▇▇▇ ASSOCIATES LLC
By: ▇▇▇▇▇▇▇ MANAGER CORP.
MANAGER
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Executive Vice President
▇▇▇▇▇▇▇ CAPITAL LLC
By: ▇▇▇▇▇▇▇ STOCK LLC
MANAGING MEMBER
By: ▇▇▇▇▇▇▇ MANAGER CORP
MANAGER
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Executive Vice President
VORNADO REALTY L.P.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
Executive Vice President
Finance and Administration
VORNADO ▇▇▇▇▇▇▇ L.L.C.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
Executive Vice President
Finance and Administration
VNK CORP.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
Executive Vice President
Finance and Administration
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this _______ day of ______________, 2001, before me personally
came _______________ to me known, who being by me duly sworn, did depose and say
that he maintains an office at ______________________________ and that he is the
______________ of ▇▇▇▇▇▇▇ ▇▇ LLC, the limited liability company described in and
which executed the foregoing instrument; and that he signed his name thereto by
like authority of the ___________________ ▇▇▇▇▇▇▇ ▇▇ LLC.
___________________________
Notary Public
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this _______ day of ______________, 2001, before me personally
came _______________ to me known, who being by me duly sworn, did depose and say
that he maintains an office at _____________________ and that he is the
______________ of ▇▇▇▇▇▇▇ CAPITAL LLC, the limited liability company described
in and which executed the foregoing instrument; and that he signed his name
thereto by like authority of the ___________________ ▇▇▇▇▇▇▇ CAPITAL LLC.
___________________________
Notary Public
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this _______ day of ______________, 2001, before me personally
came _______________ to me known, who being by me duly sworn, did depose and say
that he maintains an office at ______________________________ and that he is the
______________ of ▇▇▇▇▇▇▇ RE ASSOCIATES LLC, the limited liability company
described in and which executed the foregoing instrument; and that he signed his
name thereto by like authority of the ___________________ ▇▇▇▇▇▇▇ RE ASSOCIATES
LLC.
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this _______ day of ______________, 2001, before me personally
came _______________ to me known, who being by me duly sworn, did depose and say
that he maintains an office at ______________________________ and that he is the
______________ of ▇▇▇▇▇▇▇ STOCK LLC, the limited liability company described in
and which executed the foregoing instrument; and that he signed his name thereto
by like authority of the ___________________ ▇▇▇▇▇▇▇ STOCK LLC.
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this _______ day of ______________, 2001, before me personally
came _______________ to me known, who being by me duly sworn, did depose and say
that he maintains an office at ______________________________ and that he is the
______________ of ▇▇▇▇▇▇▇ ASSOCIATES LLC, the limited liability company
described in and which executed the foregoing instrument; and that he signed his
name thereto by like authority of the ___________________ ▇▇▇▇▇▇▇ ASSOCIATES
LLC.
___________________________
Notary Public
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this _______ day of ______________, 2001, before me personally
came _______________ to me known, who being by me duly sworn, did depose and say
that he maintains an office at ______________________________ and that he is the
______________ of VORNADO REALTY L.P., the limited partnership described in and
which executed the foregoing instrument; and that he signed his name thereto by
like authority of the ___________________ VORNADO REALTY L.P.
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this _______ day of ______________, 2001, before me personally
came _______________ to me known, who being by me duly sworn, did depose and say
that he maintains an office at ______________________________ and that he is the
______________ of VORNADO ▇▇▇▇▇▇▇ L.L.C., the limited liability company
described in and which executed the foregoing instrument; and that he signed his
name thereto by like authority of the ___________________ VORNADO ▇▇▇▇▇▇▇
L.L.C..
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this _______ day of ______________, 2001, before me personally
came _______________ to me known, who being by me duly sworn, did depose and say
that he maintains an office at ______________________________ and that he is the
______________ of VNK CORP., the corporation described in and which executed the
foregoing instrument; and that he signed his name thereto by like authority of
the ___________________ VNK CORP.
EXHIBIT D
AFFIDAVIT OF LOST CASH PARTICIPATION INSTRUMENT
STATE OF __________ )
) ss:
COUNTY OF __________ )
_______________________, the ______________________ of
____________________, being duly sworn, deposes and says:
1. I am of legal age and have knowledge of the facts stated herein.
2. Cash Participation Instrument No. ___, dated _________________, was issued by
▇▇▇▇▇▇▇ ▇▇ LLC, ▇▇▇▇▇▇▇ Capital LLC, ▇▇▇▇▇▇▇ RE Associates, ▇▇▇▇▇▇▇ Stock LLC,
▇▇▇▇▇▇▇ Associates LLC, Vornado Realty L.P., Vornado ▇▇▇▇▇▇▇ L.L.C. and VNK
Corp. (the "Issuing Entities") to ______________________ (the "Instrument").
3. ________ has caused to be made a diligent search for the originally assigned
copy of the Instrument, has been unable to locate it, and believes that it has
been lost, misfiled, misplaced or destroyed due to a clerical error.
4. ___________ was the unconditional owner of the originally executed Instrument
at the time of loss, and is entitled to the full and exclusive possession
thereof, and neither the original Instrument nor any rights therein have, in
whole or in part, been assigned, transferred, hypothecated, pledged or otherwise
disposed of, in any manner whatsoever. To the best of the undersigned's
knowledge, no person, firm or corporation other than _________ has any right,
title, claim, equity or interest in, to, or respecting the original Instrument
or the proceeds thereof.
5. If any party attempts to negotiate, assign, transfer or collect the
Instrument, ______________ agrees to indemnify and hold harmless the Issuing
Entities and their respective successors and assigns, for any liability,
obligation, loss or damages that the Issuing Entities or their respective
successors and assigns, may have or incur as a result thereof and for any costs
associated with defending against any obligations with respect to the
Instrument.
6. If ________ should ever locate, find or be in possession of the original
Instrument, (i) _______ will not negotiate, attempt to negotiate, assign or
transfer same or attempt to collect any sums thereunder, (ii) _________ will
immediately cause the surrender of the original Instrument to the Issuing
Entities for cancellation.
7. Recourse for the performance of any obligation contained in this instrument
may be had against only the individuals of on Schedule A annexed hereto (the
"Protecting Partners"). Each of the Protecting Partners shall be jointly and
severally liable for all obligations and liabilities under this instrument. By
accepting this instrument, the Issuing Entities agree that any person or entity
that is not a Protecting Partner shall not be liable for any of the obligations
under this instrument, and shall be absolved of any and all liabilities for any
and all breaches of any obligation under this instrument.
[NAME OF PERSON]
By: _______________________
Name:
Title:
