LOAN AGREEMENT
Exhibit 4.1
Execution Version
Dated as of March 11, 2019
Between
EACH OF THE ENTITIES LISTED ON SCHEDULES 1.1(a) and 1.1(b) ATTACHED HERETO,
individually and/or collectively, as the context may require, as Borrower,
and
RVI CMA HOLDER LLC, as Additional Obligor
and
COLUMN FINANCIAL, INC., JPMORGAN CHASE BANK, NATIONAL ASSOCIATION and XXXXXX XXXXXXX BANK, N.A.,
collectively, as Lender
Table of Contents
|
Page |
|
ARTICLE 1 DEFINITIONS; PRINCIPLES OF CONSTRUCTION |
1 |
|
Section 1.1. |
Definitions. |
1 |
Section 1.2. |
Principles of Construction. |
47 |
ARTICLE 2 GENERAL TERMS |
48 |
|
Section 2.1. |
Loan Commitment; Disbursement to Borrower |
48 |
Section 2.2. |
The Loan |
48 |
Section 2.3. |
Disbursement to Borrower |
48 |
Section 2.4. |
The Note and the Other Loan Documents |
48 |
Section 2.5. |
Interest Rate. |
48 |
Section 2.6. |
Loan Payments. |
56 |
Section 2.7. |
Prepayments. |
57 |
Section 2.8. |
Interest Rate Cap Agreement. |
59 |
Section 2.9. |
Extension of the Maturity Date |
64 |
Section 2.10. |
Partial Release of Property or Full Equity Release |
66 |
Section 2.11. |
Components of the Loan |
72 |
Section 2.12. |
Release of Lien Upon Payment in Full |
72 |
Section 2.13. |
Release Upon Payment in Full |
73 |
Section 2.14. |
Sale of the Puerto Rico Portfolio |
73 |
Section 2.15. |
Releases of the Outparcel |
75 |
ARTICLE 3 REPRESENTATIONS AND WARRANTIES |
77 |
|
Section 3.1. |
Legal Status and Authority |
77 |
Section 3.2. |
Validity of Documents |
78 |
Section 3.3. |
Litigation |
78 |
Section 3.4. |
Agreements |
79 |
Section 3.5. |
Financial Condition. |
79 |
Section 3.6. |
Disclosure |
79 |
Section 3.7. |
No Plan Assets |
79 |
Section 3.8. |
Not a Foreign Person |
80 |
Section 3.9. |
Intentionally Omitted. |
80 |
Section 3.10. |
Business Purposes |
80 |
Section 3.11. |
Borrower’s Principal Place of Business |
80 |
Section 3.12. |
Status of Property. |
80 |
Section 3.13. |
Financial Information |
83 |
Section 3.14. |
Condemnation |
83 |
Section 3.15. |
Separate Lots |
83 |
Section 3.16. |
Insurance |
83 |
Section 3.17. |
Use of Property |
84 |
Section 3.18. |
Leases and Rent Roll |
84 |
Section 3.19. |
Filing and Recording Taxes |
85 |
Section 3.20. |
Management Agreement |
85 |
Section 3.21. |
Illegal Activity/Forfeiture. |
85 |
|
-i- |
|
Table of Contents
(continued)
|
Page |
|
Taxes |
86 |
|
Section 3.23. |
Permitted Encumbrances |
86 |
Section 3.24. |
Intentionally Omitted. |
86 |
Section 3.25. |
Intentionally Omitted. |
86 |
Section 3.26. |
Federal Reserve Regulations |
86 |
Section 3.27. |
Investment Company Act |
86 |
Section 3.28. |
Fraudulent Conveyance |
86 |
Section 3.29. |
Embargoed Person |
87 |
Section 3.30. |
Anti-Money Laundering and Economic Sanctions |
87 |
Section 3.31. |
Organizational Chart |
88 |
Section 3.32. |
Bank Holding Company |
88 |
Section 3.33. |
Intentionally Omitted. |
88 |
Section 3.34. |
Property Document Representations |
88 |
Section 3.35. |
No Change in Facts or Circumstances; Disclosure |
89 |
Section 3.36. |
Condominium Representations |
89 |
Section 3.37. |
Ground Lease. |
90 |
Section 3.38. |
Additional Obligor Representations. |
91 |
Section 3.39. |
Survival |
92 |
ARTICLE 4 BORROWER COVENANTS |
92 |
|
Section 4.1. |
Existence |
93 |
Section 4.2. |
Legal Requirements. |
93 |
Section 4.3. |
Maintenance and Use of Property |
94 |
Section 4.4. |
Waste |
94 |
Section 4.5. |
Taxes and Other Charges. |
94 |
Section 4.6. |
Litigation |
95 |
Section 4.7. |
Access to Property |
95 |
Section 4.8. |
Notice of Default |
95 |
Section 4.9. |
Cooperate in Legal Proceedings |
96 |
Section 4.10. |
Performance by Borrower |
96 |
Section 4.11. |
Intentionally Omitted. |
96 |
Section 4.12. |
Books and Records. |
96 |
Section 4.13. |
Estoppel Certificates. |
99 |
Section 4.14. |
Leases and Rents. |
100 |
Section 4.15. |
Management Agreement. |
102 |
Section 4.16. |
Payment for Labor and Materials |
105 |
Section 4.17. |
Performance of Other Agreements |
106 |
Section 4.18. |
Debt Cancellation |
106 |
Section 4.19. |
ERISA |
106 |
Section 4.20. |
No Joint Assessment |
107 |
Section 4.21. |
Alterations |
107 |
Section 4.22. |
Property Document Covenants |
108 |
|
-ii- |
|
Table of Contents
(continued)
|
Page |
|
Environmental Liability Insurance Policy |
108 |
|
Section 4.24. |
Additional Deferred Maintenance |
108 |
Section 4.25. |
Environmental Requirements |
108 |
Section 4.26. |
Condominium Covenants. |
108 |
Section 4.27. |
Ground Lease |
111 |
Section 4.28. |
Additional Collateral. |
115 |
Section 4.29. |
Use of Casualty Proceeds |
116 |
Section 4.30. |
REIT Distributions |
118 |
Section 4.31. |
Puerto Rico Borrower Covenants |
119 |
Section 4.32. |
Additional Pre-Approved Alterations |
119 |
ARTICLE 5 ENTITY COVENANTS |
121 |
|
Section 5.1. |
Single Purpose Entity/Separateness. |
121 |
Section 5.2. |
Independent Director. |
127 |
Section 5.3. |
Change of Name, Identity or Structure |
128 |
Section 5.4. |
Business and Operations |
129 |
Section 5.5. |
Recycled Single Purpose Entity |
129 |
ARTICLE 6 NO SALE OR ENCUMBRANCE |
130 |
|
Section 6.1. |
Transfer Definitions |
130 |
Section 6.2. |
No Sale/Encumbrance. |
130 |
Section 6.3. |
Permitted Equity Transfers |
131 |
Section 6.4. |
Easements and Rights of Way. |
134 |
Section 6.5. |
Lender’s Rights |
135 |
Section 6.6. |
Economic Sanctions, Anti-Money Laundering and Transfers |
135 |
ARTICLE 7 INSURANCE; CASUALTY; CONDEMNATION; RESTORATION |
136 |
|
Section 7.1. |
Insurance |
136 |
Section 7.2. |
Casualty |
142 |
Section 7.3. |
Condemnation |
142 |
Section 7.4. |
Restoration |
143 |
ARTICLE 8 RESERVE FUNDS |
147 |
|
Section 8.1. |
Immediate Repair Account. |
147 |
Section 8.2. |
Capital Expenditures Reserve Funds. |
148 |
Section 8.3. |
Leasing Reserve Funds. |
150 |
Section 8.4. |
Operating Expense Funds |
151 |
Section 8.5. |
Excess Cash Flow Funds |
151 |
Section 8.6. |
Tax and Insurance Funds |
152 |
Section 8.7. |
[Intentionally Omitted |
154 |
Section 8.8. |
Unfunded Obligations Reserve Funds. |
154 |
Section 8.9. |
Required REIT Distributions and Tax Funds |
155 |
Section 8.10. |
Ground Lease Reserve Funds |
156 |
|
-iii- |
|
Table of Contents
(continued)
|
Page |
|
Deferred Management Fee Reserve |
156 |
|
Section 8.12. |
BI Proceeds Reserve Account |
157 |
Section 8.13. |
Restoration Abated Revenue Reserve. |
158 |
Section 8.14. |
The Accounts Generally. |
159 |
Section 8.15. |
Letters of Credit. |
161 |
Section 8.16. |
Plaza del Sol Restoration Reserves |
162 |
Section 8.17. |
No Reserves for the Puerto Rico Portfolio |
163 |
ARTICLE 9 CASH MANAGEMENT |
163 |
|
Section 9.1. |
Establishment of Certain Accounts. |
163 |
Section 9.2. |
Deposits into the Restricted Account; Maintenance of Restricted Account |
164 |
Section 9.3. |
Disbursements from the Cash Management Account |
166 |
Section 9.4. |
Withdrawals from the Debt Service Account |
167 |
Section 9.5. |
Payments Received Under this Agreement |
167 |
Section 9.6. |
Maintenance of the Cash Management Account |
168 |
ARTICLE 10 EVENTS OF DEFAULT; REMEDIES |
168 |
|
Section 10.1. |
Event of Default. |
168 |
Section 10.2. |
Remedies. |
172 |
ARTICLE 11 SECONDARY MARKET |
175 |
|
Section 11.1. |
Securitization. |
175 |
Section 11.2. |
Disclosure. |
178 |
Section 11.3. |
Reserves/Escrows |
181 |
Section 11.4. |
Servicer |
181 |
Section 11.5. |
Rating Agency Costs |
182 |
Section 11.6. |
New Mezzanine Option |
182 |
Section 11.7. |
Registered Form |
182 |
Section 11.8. |
Syndication |
182 |
Section 11.9. |
Uncross of Properties. |
187 |
Section 11.10. |
Costs and Expenses |
188 |
ARTICLE 12 INDEMNIFICATIONS |
188 |
|
Section 12.1. |
General Indemnification |
188 |
Section 12.2. |
Mortgage and Intangible Tax Indemnification |
189 |
Section 12.3. |
ERISA Indemnification |
189 |
Section 12.4. |
Duty to Defend, Legal Fees and Other Fees and Expenses |
189 |
Section 12.5. |
Survival |
190 |
Section 12.6. |
Environmental Indemnity |
190 |
|
-iv- |
|
Table of Contents
(continued)
|
Page |
|
190 |
||
Section 13.1. |
Exculpation. |
190 |
ARTICLE 14 NOTICES |
193 |
|
Section 14.1. |
Notices |
193 |
ARTICLE 15 FURTHER ASSURANCES |
195 |
|
Section 15.1. |
Replacement Documents |
195 |
Section 15.2. |
Recording of Security Instrument, etc |
195 |
Section 15.3. |
Further Acts, etc |
196 |
Section 15.4. |
Changes in Tax, Debt, Credit and Documentary Stamp Laws. |
196 |
ARTICLE 16 WAIVERS |
197 |
|
Section 16.1. |
Remedies Cumulative; Waivers. |
197 |
Section 16.2. |
Modification, Waiver in Writing. |
197 |
Section 16.3. |
Delay Not a Waiver. |
198 |
Section 16.4. |
Waiver of Trial by Jury. |
198 |
Section 16.5. |
Waiver of Notice. |
198 |
Section 16.6. |
Remedies of Borrower. |
198 |
Section 16.7. |
Marshalling and Other Matters. |
199 |
Section 16.8. |
Intentionally Omitted. |
199 |
Section 16.9. |
Waiver of Counterclaim |
199 |
Section 16.10. |
Sole Discretion of Lender |
199 |
ARTICLE 17 MISCELLANEOUS |
199 |
|
Section 17.1. |
Survival |
199 |
Section 17.2. |
Governing Law |
199 |
Section 17.3. |
Headings |
201 |
Section 17.4. |
Severability |
201 |
Section 17.5. |
Preferences |
201 |
Section 17.6. |
Expenses |
201 |
Section 17.7. |
Cost of Enforcement |
203 |
Section 17.8. |
Schedules Incorporated |
203 |
Section 17.9. |
Offsets, Counterclaims and Defenses |
203 |
Section 17.10. |
No Joint Venture or Partnership; No Third Party Beneficiaries. |
203 |
Section 17.11. |
Publicity |
204 |
Section 17.12. |
Limitation of Liability |
205 |
Section 17.13. |
Conflict; Construction of Documents; Reliance |
205 |
Section 17.14. |
Entire Agreement |
205 |
Section 17.15. |
Liability |
205 |
Section 17.16. |
Duplicate Originals; Counterparts |
205 |
Section 17.17. |
Brokers |
206 |
|
-v- |
|
Table of Contents
(continued)
|
Page |
|
Set-Off |
206 |
|
Section 17.19. |
Contributions and Waivers |
206 |
Section 17.20. |
Cross-Default; Cross-Collateralization. |
210 |
Section 17.21. |
Intercreditor Agreement |
211 |
|
-vi- |
|
THIS LOAN AGREEMENT, dated as of March [11], 2019 (as amended, restated, replaced, supplemented or otherwise modified from time to time, this “Agreement”), by and among COLUMN FINANCIAL, INC., having an address at 00 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (“CF”), JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, having an address at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (“JPM”) and XXXXXX XXXXXXX BANK, N.A., having an address at 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (“MS”; together with CF and JPM and their respective successors and/or assigns, each a “Co-Lender” and, collectively, collectively “Lender”), and EACH OF THE ENTITIES LISTED ON SCHEDULE 1.1(a) ATTACHED HERETO, each having its principal place of business at 0000 Xxxxxxxxxx Xxxxxxx, Xxxxxxxxx, XX 00000 (individually or collectively, as the context may require, together with their respective permitted successors and/or assigns, “Continental Borrower”), EACH OF THE ENTITIES LISTED ON SCHEDULE 1.1(b) ATTACHED HERETO, each having its principal place of business at 0000 Xxxxxxxxxx Xxxxxxx, Xxxxxxxxx, XX 00000 (individually or collectively, as the context may require, together with their respective permitted successors and/or assigns, “Puerto Rico Borrower”; together with Continental Borrower, individually or collectively, as the context may require, “Borrower”), and RVI CMA HOLDER LLC, a Delaware limited liability company having its principal place of business at 0000 Xxxxxxxxxx Xxxxxxx, Xxxxxxxxx, XX 00000 (“Additional Obligor”).
RECITALS:
Borrower desires to obtain the Loan (defined below) from Lender.
Additional Obligor is owned 100% by Sponsor and shall receive a substantial benefit from Lender making the Loan.
Lender is willing to make the Loan to Borrower, subject to and in accordance with the terms of this Agreement and the other Loan Documents (defined below).
In consideration of the making of the Loan by Lender and the covenants, agreements, representations and warranties set forth in this Agreement, the parties hereto hereby covenant, agree, represent and warrant as follows:
ARTICLE 1
DEFINITIONS; PRINCIPLES OF CONSTRUCTION
Section 1.1.Definitions.
For all purposes of this Agreement, except as otherwise expressly required or unless the context clearly indicates a contrary intent:
“Acceptable LLC” shall mean a limited liability company formed under Delaware law which (i) has at least one springing member, which, upon the dissolution of all of the members or the withdrawal or the disassociation of all of the members from such limited
1
liability company, shall immediately become the sole member of such limited liability company, and (ii) otherwise meets the Rating Agency criteria then applicable to such entities.
“Account Collateral” shall mean (i) the Accounts, and all cash, checks, drafts, certificates and instruments, if any, from time to time deposited or held in the Accounts from time to time; (ii) any and all amounts invested in Permitted Investments; (iii) all interest, dividends, cash, instruments and other property from time to time received, receivable or otherwise payable in respect of, or in exchange for, any or all of the foregoing; and (iv) to the extent not covered by clauses (i) - (iii) above, all “proceeds” (as defined under the UCC as in effect in the state in which the Accounts are located) of any or all of the foregoing.
“Accounts” shall mean the Cash Management Account, the Debt Service Account, the Restricted Account, the Tax Account, the Casualty Proceeds Restricted Account, the Insurance Account, the Capital Expenditures Reserve Account, the Leasing Reserve Account, the Excess Cash Flow Account, the Operating Expense Account, the Ground Lease Reserve Account, the Unfunded Obligations Reserve Account, the Required REIT Distributions and Tax Account, the Immediate Repair Account, the Deferred Management Fee Reserve Account, the BI Proceeds Reserve Account and any other account established by this Agreement or the other Loan Documents.
“Act” shall have the meaning set forth in Section 5.1 hereof.
“Additional Collateral” shall mean, collectively, (a) all of Borrower’s, Pledgor’s and Additional Obligor’s assignable right, title, and interest in and to all contracts, excluding the Management Agreement which is assigned pursuant to the Assignment of Management Agreement, in connection with the management, construction, repair, renovation, use, operation or maintenance of any Individual Property, including, without limitation, any Property Documents, any agreements regarding parking facilities for any Individual Property, any architect’s agreements, construction contracts, licensing agreements, subcontracts, service and supply agreements, any other agreements with design professionals, all agreements, allocations, and rights with all utility services serving any Individual Property and all development agreements, reservation agreements, agreements of sale, options to purchase, rights of first refusal or any other preferential right and Permits, which have heretofor been or will hereafter be executed by or on behalf of Borrower, Pledgor or Additional Obligor or which have been or will hereafter be assigned to or acquired by Borrower, in each case as the same may thereafter from time to time be supplemented, amended, modified or extended by one or more written agreements supplemental thereto relevant to the Properties or any Individual Property; (b) all of Borrower’s, Pledgor’s and Additional Obligor’s assignable right, title, privileges, claims, remedies, causes of action and interest in and to all warranties, guarantees, and other rights of Borrower, direct or indirect, against manufacturers, dealers, suppliers, contractors, and others in connection with work done or to be done and the materials supplied or to be supplied to or for the Properties or any Individual Property; and (c) all of Borrower’s, Pledgor’s and Additional Obligor’s assignable right, title and interest in and to any and all proceeds (including non-cash proceeds) of any of the foregoing items enumerated in the preceding clauses (a) and (b).
“Additional Obligor” shall have the meaning set forth in the introductory paragraph hereto.
2
“Additional Pre-Approved Alterations” shall mean the demolition of the buildings described on Schedule 4.32.
“Affected Individual PR Properties” shall mean, individually and/or collectively (as the context requires), any Individual Puerto Rico Property that was damaged as a result of any hurricane impacting Puerto Rico prior to the Closing Date, it being understood that as of the Closing Date, each Individual Puerto Rico Property is an Affected Individual PR Property.
“Affected Property” shall have the meaning set forth in Section 11.9 hereof.
“Affiliate” shall mean, as to any Person, any other Person that, directly or indirectly, is in Control of, is Controlled by or is under common Control with such Person.
“Affiliated Manager” shall mean any Manager of any Individual Property in which Borrower, Sponsor, Pledgor, Additional Obligor, any SPE Component Entity (if any), or any Affiliate of such entities has, directly or indirectly, any legal, beneficial or economic interest.
“Agent” shall have the meaning set forth in Section 11.8(a)(iv) hereof.
“Aggregate Square Footage” shall mean the aggregate rentable square footage of the Properties (but excluding the rentable square footage of each Released Property that shall have been released from the lien of the related Security Instrument pursuant to Section 2.10 prior to the date of determination) as set forth on Schedule 1.1(c) hereof.
“Agreement” shall have the meaning set forth in the introductory paragraph hereto.
“Allocated Loan Amount” shall mean the portion of the principal amount of the Loan allocated to the Plaza del Sol Property and each Individual Continental Property as set forth on Schedule 1.1(d) hereof; provided, however, that in the event any applicable Individual Continental Property is a Combined Individual Property and a related Combined Individual Property Parcel is the subject of such release or other question, then the “Allocated Loan Amount” shall mean the amount allocated to such Combined Individual Property Parcel on Schedule 1.1(m) hereof.
“ALTA” shall mean American Land Title Association, or any successor thereto.
“Alteration Threshold” shall mean (a) with respect to the Plaza del Sol Property and each Individual Continental Property, an amount equal to 5% of the outstanding principal amount of the Allocated Loan Amount attributable to the Plaza del Sol Property or such Individual Continental Property, as applicable, and (b) with respect to each Individual Puerto Rico Property other than the Plaza del Sol Property (which is addressed in the foregoing clause (a)), the lesser of (x) $7,500,000 for each such Individual Puerto Rico Property other than the Plaza del Sol Property (which is addressed in the foregoing clause (a)) and (y) thirty percent (30%) of the overall value of such Individual Property based on the appraisals received by Lender in connection with the closing of the Loan, provided, however that, without Lender’s prior written consent, under no circumstances shall the aggregate amount of all alterations (without taking into account the alterations related to the PR Restoration) at the Individual Puerto
3
Rico Properties other than the Plaza del Sol Property (which is addressed in the foregoing clause (a)) being undertaken at a given time exceed $22,000,000.
“Alternate Index” shall mean a floating rate index (a) that is commonly accepted by market participants in commercial real estate loans as an alternative to LIBOR, as determined by Lender in its sole but good faith discretion, (b) that is publicly recognized by the International Swaps and Derivatives Association (“ISDA”) or any successor organization, as an alternative to LIBOR and (c) for which ISDA has approved an amendment to hedge agreements, generally providing such floating rate index as a standard alternative to LIBOR.
“Alternate Index Determination” shall have the meaning set forth in Section 2.5 hereof.
“Alternate Index Rate” shall mean, with respect to each Interest Accrual Period, the per annum rate of interest of the Alternate Index, determined as of the related Determination Date.
“Alternate Rate” shall mean, with respect to the applicable Interest Accrual Period, the per annum rate of interest equal to the Alternate Index Rate plus the Alternate Rate Spread for each Component; provided, however, that such Alternate Rate shall not be less than the LIBOR Spread for the applicable Component.
“Alternate Rate Condition” shall have the meaning set forth in Section 2.5 hereof.
“Alternate Rate Loan” shall mean the Loan at such time as interest thereon accrues at a per annum rate of interest equal to the Alternate Rate for each Component.
“Alternate Rate Spread” shall mean, with respect to any Component of the Loan, as the same may be reallocated pursuant to, and in accordance with, Section 11.1(b) hereof, in connection with any conversion of the Loan from (a) a LIBOR Loan to an Alternate Rate Loan, the greater of (i) the difference (expressed as the number of basis points) obtained by subtracting (A) the Alternate Index Rate as of the Determination Date for which LIBOR was last available from (B) LIBOR, determined as of such Determination Date, plus the LIBOR Spread applicable to such Component, and (ii) zero (0), or (b) a Prime Rate Loan to an Alternate Rate Loan, the greater of (i) the difference (expressed as the number of basis points) obtained by subtracting (A) the Alternate Index Rate as of the Determination Date for which the Prime Index Rate was last available from (B) the Prime Index Rate, determined as of such Determination Date, plus the Prime Rate Spread applicable to such Component, and (ii) zero (0). The Alternate Rate Spread shall be increased by 25 basis points (0.25%) from and after the first day of the third Extension Period in accordance with Section 2.9(g), without duplication of any increase with respect to the LIBOR Spread or the Prime Rate Spread in accordance with Section 2.9(g).
“Anchor Tenant” shall mean with respect to each Individual Property, any Tenant whose Lease demises 50,000 square feet or more of the applicable Individual Property’s gross leasable area.
“Annual Budget” shall have the meaning set forth in Section 4.12 hereof.
4
“Applicable Contribution” shall have the meaning set forth in Section 17.19 hereof.
“Approved Accounting Method” shall mean GAAP, federal tax basis accounting (consistently applied) or such other method of accounting, consistently applied, as may be reasonably acceptable to Lender.
“Approved Annual Budget” shall have the meaning set forth in Section 4.12 hereof.
“Approved Bank” means (a) a bank or other financial institution which has the Required Rating, (b) if a Securitization has not occurred, a bank or other financial institution reasonably acceptable to Lender or (c) if a Securitization has occurred, a bank or other financial institution with respect to which Lender shall have received a Rating Agency Confirmation.
“Approved Extraordinary Expense” shall mean an expense of the applicable Individual Property not set forth on the annual operating budget delivered to Lender, or, if a Trigger Period is continuing, the Approved Annual Budget but approved by Lender in writing (which such approval shall not be unreasonably withheld, conditioned or delayed).
“Approved ID Provider” shall mean each of CT Corporation, Corporation Service Company, National Registered Agents, Inc., Wilmington Trust Company, Xxxxxxx Management Company and Lord Securities Corporation; provided, that, (A) the foregoing shall be deemed Approved ID Providers unless and until disapproved by any Rating Agency and (B) additional national providers of Independent Directors may be deemed added to the foregoing hereunder to the extent approved in writing by Lender and the Rating Agencies.
“Approved Operating Expense” shall mean an operating expense of the applicable Individual Property set forth on the Annual Budget or, if a Trigger Period is continuing, the Approved Annual Budget. For the avoidance of doubt, (i) only management fees and sub-management fees equal to or less than the Management Fee Cap shall be considered an Approved Operating Expense; (ii) only Sponsor Corporate Expenses equal to or less than $6,000,000 (in the aggregate in any twelve month period) shall be deemed Approved Operating Expenses and (iii) only Site Centers Shared Services Fees equal to or less than the Site Centers Shared Services Fee Cap (in the aggregate in any twelve month period) shall be deemed Approved Operating Expenses.
“Assignee Borrower” shall have the meaning set forth in Section 2.8 hereof.
“Assignment and Assumption” shall have the meaning set forth in Section 11.8(a)(i) hereof.
“Assignment of Management Agreement” shall mean, individually and/or collectively (as the context requires), (a) with respect to each Non-REIT Borrower, that certain Conditional Assignment of Management Agreement dated as of the date hereof among Lender, each Non-REIT Borrower and Manager, as the same may be amended, restated, replaced, extended, renewed, supplemented or otherwise modified from time to time, (b) with respect to each REIT Borrower, that certain Conditional Assignment of Management Agreement dated as
5
of the date hereof among Lender, each REIT Borrower and Manager, as the same may be amended, restated, replaced, extended, renewed, supplemented or otherwise modified from time to time and (c) with respect to each Individual Puerto Rico Property, that certain Conditional Assignment of Management Agreement dated as of the date hereof among Lender, each Puerto Rico Borrower and Manager, as the same may be amended, restated, replaced, extended, renewed, supplemented or otherwise modified from time to time.
“Award” shall mean any compensation paid by any Governmental Authority in connection with a Condemnation in respect of all or any part of the Property.
“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.
“Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.
“Bank” shall be deemed to refer to (individually and/or collectively, as the context requires) the bank or other institution maintaining the Cash Management Account, the Restricted Account and/or the Casualty Proceeds Restricted Account, as applicable, pursuant to the Cash Management Agreement, the Restricted Account Agreement and/or the Casualty Proceeds Restricted Account Agreement, as applicable.
“Bankrupt Person” shall have the meaning set forth in Section 13.1 hereof.
“Bankruptcy Action” shall mean with respect to any Person (a) such Person filing a voluntary petition under the Bankruptcy Code; (b) the filing of an involuntary petition against such Person under the Bankruptcy Code, or soliciting or causing to be solicited petitioning creditors for any involuntary petition against such Person under the Bankruptcy Code; (c) such Person filing an answer consenting to or otherwise acquiescing in or joining in any involuntary petition filed against it, by any other Person under the Bankruptcy Code; (d) such Person consenting to or acquiescing in or joining in an application for the appointment of a custodian, receiver, trustee, or examiner for such Person or any portion of any Individual Property or any portion of the Collateral; or (e) such Person making an assignment for the benefit of creditors.
“Bankruptcy Code” shall mean Title 11 of the United States Code entitled “Bankruptcy”, as amended from time to time, and any successor statute or statutes and all rules and regulations from time to time promulgated thereunder, and any comparable foreign laws relating to bankruptcy, insolvency or creditors’ rights.
“Bankruptcy Event” shall mean the occurrence of any one or more the of the following: (i) Borrower, Pledgor, Additional Obligor or any SPE Component Entity shall commence any case, proceeding or other action (A) under the Bankruptcy Code and/or any Creditors Rights Laws seeking to have an order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, liquidation, division or
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dissolution or (B) seeking appointment of a receiver, trustee, custodian, conservator or other similar official for it or for all or any substantial part of its assets; (ii) Borrower, Pledgor, Additional Obligor or any SPE Component Entity shall make a general assignment for the benefit of its creditors; (iii) any Restricted Party (or Affiliate thereof) files, or joins or colludes in the filing of, (A) an involuntary petition against Borrower, Pledgor, Additional Obligor or any SPE Component Entity under the Bankruptcy Code or any other Creditors Rights Laws, or solicits or causes to be solicited or colludes with petitioning creditors for any involuntary petition under the Bankruptcy Code or any other Creditors Rights Laws against Borrower, Pledgor, Additional Obligor or any SPE Component Entity or (B) any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of Borrower’s, Pledgor’s, Additional Obligor’s or any SPE Component Entity’s assets; (iv) Borrower, Pledgor, Additional Obligor or any SPE Component Entity files an answer consenting to or otherwise acquiescing in or joining in any involuntary petition filed against it, by any other Person under the Bankruptcy Code or any other Creditors Rights Laws, or solicits or causes to be solicited or colludes with petitioning creditors for any involuntary petition from any Person; (v) any Restricted Party (or Affiliate thereof) consents in writing to or acquiesces in or joins in an application for the appointment of a custodian, receiver, trustee, or examiner for Borrower, Pledgor, Additional Obligor, any SPE Component Entity, the Collateral or any portion of the Property (other than at the written direction of Lender); (vi) Borrower, Pledgor, Additional Obligor or any SPE Component Entity makes an assignment for the benefit of creditors, or admits, in writing or in any legal proceeding, its insolvency or inability to pay its debts as they become due; and (vii) any Restricted Party (or Affiliate thereof) contesting or opposing any motion made by Lender to obtain relief from the automatic stay or seeking to reinstate the automatic stay in the event of any proceeding under the Bankruptcy Code or any other Creditors Rights Laws involving Sponsor or its subsidiaries.
“Benefit Amount” shall have the meaning set forth in Section 17.19 hereof.
“BI Proceeds” shall mean all business interruption insurance proceeds received with respect to any insurance policy related to any Individual Puerto Rico Property on account of any claim made under such policies resulting from losses due to any Prior Hurricane Damage and/or any Prior Hurricane Damage (Plaza del Sol).
“BI Proceeds Disbursement Schedule” shall have the meaning set forth in Section 8.12 hereof.
“BI Proceeds Reserve Account” shall have the meaning set forth in Section 8.12 hereof.
“BI Proceeds Reserve Funds” shall have the meaning set forth in Section 8.12 hereof.
“Borrower” shall have the meaning set forth in the introductory paragraph hereto.
“Borrower’s Certificate” shall mean that certain Borrower’s Certification, dated as of the date hereof, by each Borrower.
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“Borrower Party” and “Borrower Parties” shall mean each of Borrower, any SPE Component Entity, Sponsor, Pledgor, Additional Obligor and any Affiliated Manager.
“Breakage Costs” shall have the meaning set forth in Section 2.5(b)(vii) hereof.
“Broker” shall have the meaning set forth in Section 17.17 hereof.
“Business Day” shall mean any day other than a Saturday, Sunday or any other day on which commercial banks in New York, New York or the place of business of the trustee under a Securitization (or, if no Securitization has occurred, Lender) or the Servicer or the financial institution that maintains any collection account for or on behalf of the Servicer or any Reserve Funds or the New York Stock Exchange or the Federal Reserve Bank of New York is not open for business.
“Capital Expenditures” for any period shall mean replacements and/or alterations to any Individual Property; provided, that, the same are (i) required to be capitalized according to the Approved Accounting Method and (ii) included in the Annual Budget or Approved Annual Budget, as applicable.
“Capital Expenditures Reserve Account” shall have the meaning set forth in Section 8.2 hereof.
“Capital Expenditures Reserve Funds” shall have the meaning set forth in Section 8.2 hereof.
“Capital Expenditures Reserve Monthly Deposit” shall mean for each date of determination, one-twelfth (1/12th) of the amount equal to the Aggregate Square Footage for each Individual Continental Property and the Plaza del Sol Property multiplied by $0.25.
“Cash Management Account” shall have the meaning set forth in Section 9.1 hereof.
“Cash Management Agreement” shall mean that certain Cash Management Agreement, dated as of the date hereof, by and between Borrower, Additional Obligor, Lender, and Xxxxx Fargo Bank, National Association (as cash management bank), as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.
“Casualty” shall have the meaning set forth in Section 7.2.
“Casualty Consultant” shall have the meaning set forth in Section 7.4 hereof.
“Casualty Proceeds” shall have the meaning set forth in Section 9.1 hereof.
“Casualty Proceeds Restricted Account” shall have the meaning set forth in Section 9.1 hereof.
“Casualty Proceeds Restricted Account Agreement” shall mean that certain Deposit Account Control Agreement (Springing Agreement-Casualty Proceeds) by and among
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Puerto Rico Borrowers, Lender and PNC Bank, National Association dated as of the date hereof, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time in accordance with the terms hereof.
“CF” shall have the meaning set forth in the introductory paragraph hereto.
“Closing Date” shall mean the date of the funding of the Loan.
“Co-Lender” shall have the meaning set forth in Section 11.8(a)(i) hereof.
“Co-Lending Agreement” shall mean the co-lending agreement entered into between Lender, individually as a Co-Lender and as Agent, and the other Co-Lenders in the event of a Syndication, as the same may be further supplemented modified, amended or restated.
“Collateral” or “Pledged Collateral” mean (i) the Pledged Collateral (as defined in the Pledge Agreement) and (ii) all other collateral for the Loan granted under the Loan Documents.
“Collateral Assignment of Interest Rate Cap Agreement” shall mean that certain Collateral Assignment of Interest Rate Cap Agreement, dated as of the date hereof, executed by Borrower in connection with the Loan for the benefit of Lender, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.
“Combined Individual Property” shall mean those certain Individual Properties set forth on Schedule 1.1(m).
“Combined Individual Property Parcel” shall mean those certain tax parcels identified on Schedule 1.1(m) with respect to each such Combined Individual Property.
“Common Charges” shall have the meaning set forth in Section 3.36 hereof.
“Component” shall mean, individually, any one of Component A, Component B, Component C or Component H-RR.
“Component A” shall mean the component of the Loan designated as “A” in Section 2.11 hereof.
“Component B” shall mean the component of the Loan designated as “B” in Section 2.11 hereof.
“Component C” shall mean the component of the Loan designated as “C” in Section 2.11 hereof.
“Component H-RR” shall mean the component of the Loan designated as “H-RR” in Section 2.11 hereof.
“Components” shall mean, collectively, Component A, Component B, Component C and Component H-RR.
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“Condemnation” shall mean a temporary or permanent taking by any Governmental Authority as the result, in lieu or in anticipation, of the exercise of the right of condemnation or eminent domain, of all or any part of the Property, or any interest therein or right accruing thereto, including any right of access thereto or any change of grade affecting the Property or any part thereof.
“Condominium” shall mean the Seabrook Condominium.
“Condominium Board” shall mean the board of directors of the condominium association or governing body of the Condominium.
“Condominium Charges” shall mean Common Charges, special assessments and other assessments charged to, or otherwise payable by, Borrower under the Condominium Documents.
“Condominium Charges Adjustment” shall mean an adjustment to the calculation of Operating Expenses for imminent liabilities related to the Condominium Documents and/or other increases in Condominium Charges.
“Condominium Documents” shall mean the Seabrook Condominium Documents.
“Condominium Law” shall mean all applicable local, state and federal laws, rules and regulations which effect the establishment and maintenance of condominiums in the applicable State where the Condominium is located.
“Connection Income Taxes” shall mean Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.
“Constituent Member” shall have the meaning set forth in Section 5.2(b) hereof.
“Constituent Owner” shall mean, as to any Person, any Person that owns a direct or indirect interest in such Person.
“Continental Borrower” shall have the meaning set forth in the introductory paragraph hereto.
“Contribution” shall have the meaning set forth in Section 17.19 hereof.
“Control” shall mean the power to direct the management and policies of an entity, directly or indirectly, whether through the ownership of voting securities or other beneficial interests, by contract or otherwise, and Control shall not be deemed absent solely because another Person shall have veto power or consent rights with respect to specified and customary major decisions. The terms “Controlled” and “Controlling” shall have correlative meanings.
“Converted Interest Rate Cap Agreement” shall have the meaning set forth in Section 2.8(i) hereof.
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“Corporate Loan” shall have the meaning set forth in Section 6.3 hereof.
“Counterparty” shall mean the counterparty under any Interest Rate Cap Agreement, Replacement Interest Rate Cap Agreement or Substitute Interest Rate Cap Agreement, which counterparty shall satisfy the Minimum Counterparty Rating and otherwise be reasonably acceptable to Lender.
“Covered Rating Agency Information” shall mean any Provided Information furnished to the Rating Agencies in connection with issuing, monitoring and/or maintaining the Securities.
“Creditors Rights Laws” shall mean any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization, conservatorship, arrangement, adjustment, winding-up, liquidation, division, dissolution, composition or other relief with respect to its debts or debtors.
“Crossroads Ground Lease” shall have the meaning set forth on Schedule 1.1(e) hereto.
“Crossroads Property” shall mean the Individual Continental Property commonly known as Crossroads Center.
“Crowdfunded Person” means a Person capitalized primarily by monetary contributions (A) of less than $35,000 each from more than 35 investors who are individuals and (B) which are funded primarily (I) in reliance upon Regulation Crowdfunding promulgated by the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended and/or (II) through internet-mediated registries, platforms or similar portals, mail-order subscriptions, benefit events and/or other similar methods.
“Debt” shall mean the outstanding principal amount set forth in, and evidenced by, this Agreement and the Note together with all interest accrued and unpaid thereon and all other sums due to Lender in respect of the Loan under the Note, this Agreement or the other Loan Documents (including, without limitation, all costs and expenses payable to Lender thereunder).
“Debt Service” shall mean, with respect to any particular period of time, scheduled principal (if applicable) and interest payments hereunder (including, as and to the extent applicable, interest accruing at the Default Rate).
“Debt Service Account” shall have the meaning set forth in Section 9.1 hereof.
“Debt Service Coverage Ratio” shall mean the ratio calculated by Lender of (i) Net Cash Flow for the Plaza del Sol Property and the Individual Continental Properties (which, for the purposes of this clause (i), the Operating Expense component of Net Cash Flow shall be calculated to include (I) normalized Capital Expenditures equal to the Aggregate Square Footage of the Plaza del Sol Property and the Individual Continental Properties multiplied by $0.25, and (II) normalized tenant improvement and leasing commission expenditures equal to the Aggregate Square Footage of the Plaza del Sol Property and the Individual Continental Properties
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multiplied by $1.00) to (ii) the aggregate amount of (x) Debt Service for each of the Components of the Loan which would be due for the twelve (12) month period immediately following the date of calculation; calculated assuming an interest rate equal to the sum of the weighted average (weighted by the outstanding balance of each Component of the Loan) of (a) the LIBOR Spread (or the Prime Rate Spread or the Alternate Rate Spread, as applicable) plus (b) the Strike Rate that will be in effect for the applicable Extension Period and (y) any Mezzanine Debt Service (weighted by the outstanding balance of each Mezzanine Loan) of (a) the LIBOR Spread ((or the Prime Rate Spread or the Alternate Rate Spread, as applicable) (as each are defined in each Mezzanine Loan Agreement)) plus (b) the Strike Rate (as defined in each Mezzanine Loan Agreement) that will be in effect for the applicable Extension Period (as defined in each Mezzanine Loan Agreement).
“Debt Yield” shall mean, as of any date of calculation, a ratio conveyed as a percentage in which: (i) the numerator is the Net Cash Flow for the Plaza del Sol Property and the Individual Continental Properties; and (ii) the denominator is the aggregate amount of the then outstanding principal balance of the Loan (including all Components thereof) and the Mezzanine Loans.
“Debt Yield Trigger” shall have the meaning set forth in the definition of “Trigger Period” in this Section 1.1.
“Debt Yield Trigger Cure Payment” shall mean (i) delivery to Lender of an amount (which amounts shall be held by Lender or Servicer as additional collateral for the Loan and may be applied to the Debt during the continuance of an Event of Default) equal to the amount necessary to cause the Debt Yield to be at least equal to the Debt Yield Trigger calculated as if such amount had been applied pro-rata to the reduction of the principal balance of the Loan and each Mezzanine Loan as of the applicable Test Date. Any amounts deposited pursuant to the foregoing shall be held as additional collateral for the Loan and shall only be returned to Borrower upon the earlier of (a) the date Lender determines that the Debt Yield is at least equal to the Debt Yield Trigger as of any Test Date without giving effect to any amounts deposited pursuant to this provision and (b) the indefeasible payment in full of the Debt or (ii) a prepayment of the Loan and each Mezzanine Loan applied pro rata between the Loan and each Mezzanine Loan and otherwise made in accordance with Section 2.7 hereof in an amount sufficient to cause the Debt Yield to be at least equal to the Debt Yield Trigger calculated as of the applicable Test Date.
“Deemed Approval Requirements” means, with respect to a request by Borrower for Lender’s approval or consent, that:
(i) |
if the first correspondence from Borrower to Lender requesting such approval or consent contains a bold-faced, conspicuous legend at the top of the first page thereof stating “FIRST NOTICE: THIS IS A REQUEST FOR CONSENT UNDER THE 2019 RVT PORTFOLIO LOAN, DATED AS OF MARCH [11], 2019. FAILURE TO RESPOND TO THIS REQUEST WITHIN TEN (10) BUSINESS DAYS MAY RESULT IN THE REQUEST BEING DEEMED GRANTED,” and is accompanied by such information and documents as is reasonably required for Lender to adequately evaluate such request and as reasonably requested by Lender in writing prior to the expiration of such five (5) Business Day period, and |
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“Default” shall mean the occurrence of any event hereunder or under the Note or the other Loan Documents which, but for the giving of notice or passage of time, or both, would be an Event of Default.
“Default Prepayment Premium” shall mean an amount equal to five percent (5%) of the Debt being repaid or prepaid.
“Default Rate” shall mean, with respect to the Loan, a rate per annum equal to the lesser of (i) the Maximum Legal Rate, or (ii) the greater of (A) four percent (4%) above the Interest Rate otherwise applicable to each Component and (B) the Prime Rate plus one percent (1.0%).
“Deferred Construction and Tenant Coordination Fees” shall mean those costs and expenses payable to Manager pursuant to Section 5.3 of the Management Agreement in effect as of the Closing Date.
“Deferred Coordination Fee Annual Cap” shall have the meaning set forth in Section 8.11 hereof.
“Deferred Disposition Fees” shall mean those disposition fees payable to Manager pursuant to Section 5.2 of the Management Agreement in effect as of the Closing Date.
“Deferred Leasing Fee Annual Cap” shall have the meaning set forth in Section 8.11 hereof.
“Deferred Management Certificate” shall have the meaning set forth in Section 8.11 hereof.
“Deferred Management Fee Calculation Period” shall mean, with respect to each Trigger Period, (i) the period beginning on (and including) the first Monthly Payment Date of such Trigger Period and ending on (and excluding) the first anniversary thereafter and (ii) so long as such Trigger Period remains in effect, each twelve (12) month period thereafter.
“Deferred Management Fee Cap” shall mean (i) with respect to Deferred Management Leasing Fees, the Deferred Leasing Fee Annual Cap, and (ii) with respect to
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Deferred Construction and Tenant Coordination Fees, the Deferred Coordination Fee Annual Cap.
“Deferred Management Fee Reserve Account” shall have the meaning set forth in Section 8.11 hereof.
“Deferred Management Fee Reserve Funds” shall have the meaning set forth in Section 8.11 hereof.
“Deferred Management Fees” shall mean, individually and/or collectively, as the context requires, the Deferred Management Leasing Fees, Deferred Construction and Tenant Coordination Fees and Deferred Disposition Fees, in each case, only to the extent incurred, earned and unpaid.
“Deferred Management Leasing Fees” shall mean those certain leasing commissions payable to Manager pursuant to Section 5.2 of the Management Agreement in effect as of the Closing Date.
“Determination Date” shall mean, with respect to any Interest Accrual Period, the date that is two (2) London Business Days prior to the first day of such Interest Accrual Period.
“Disclosure Documents” shall mean, collectively and as applicable, any offering circular, prospectus, prospectus supplement, private placement memorandum or other offering document, in each case, in connection with a Securitization.
“Division” shall mean, as to any Person, such Person dividing and/or otherwise engaging in and/or becoming subject to, in each case, any division (whether pursuant to plan of division or otherwise), including, without limitation and to the extent applicable, pursuant to §18-217 of the Act.
“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.
“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
“EEA Resolution Authority” means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
“Eligible Account” shall mean a separate and identifiable account from all other funds held by the holding institution that is an account or accounts maintained with a federal or state-chartered depository institution or trust company which (a) complies with the definition of
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Eligible Institution, (b) has a combined capital and surplus of at least $50,000,000 and (c) has corporate trust powers and is acting in its fiduciary capacity. An Eligible Account will not be evidenced by a certificate of deposit, passbook or other instrument.
“Eligible Institution” shall mean (a) a depository institution or trust company insured by the Federal Deposit Insurance Corporation (i) the short term unsecured debt obligations or commercial paper of which are rated at least “A‑1+” (or its equivalent) from each of the Rating Agencies (in the case of accounts in which funds are held for thirty (30) days or less) and (ii) the long term unsecured debt obligations of which are rated at least “A+” (or its equivalent) from each of the Rating Agencies (in the case of accounts in which funds are held for more than thirty (30) days), (b) such other depository institution otherwise approved by the Rating Agencies from time-to-time, (c) in its capacity as Bank, Xxxxx Fargo Bank, N.A, PNC Bank, N.A. or U.S. Bank, N.A. or (d) KeyBank National Association so long as KeyBank National Association’s commercial paper, short‑term debt obligations or deposits are rated at least “A-2” by S&P and “P-1” by Moody’s, if the deposits are to be held in the related account for less than thirty (30) days, and whose long‑term senior unsecured debt obligations or deposits are rated at least “A-” by S&P and “A2” by Moody’s, if the deposits are to be held in the related account for thirty (30) days or more, provided, that, in each case the applicable ratings of such entities are not reduced below the ratings in effect as of the Closing Date.
“Embargoed Person” shall have the meaning set forth in Section 3.29 hereof.
“Environmental Indemnity” shall mean that certain Environmental Indemnity Agreement, dated as of the date hereof, executed by Borrower and Sponsor in connection with the Loan for the benefit of Lender, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.
“Environmental Laws” shall have the meaning set forth in the Environmental Indemnity.
“Environmental Work” shall have the meaning set forth in Section 4.25 hereof.
“Equity Collateral” shall have the meaning set forth in Section 11.6 hereof.
“Equity Interests” shall mean limited liability company membership interests or other equity interests of, and all other right, title and interest now owned or hereafter acquired by, Pledgor in and to an individual Puerto Rico Borrower.
“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as the same may heretofore have been or shall be amended, restated, replaced or otherwise modified.
“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.
“Event of Default” shall have the meaning set forth in Section 10.1 hereof.
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“Excess Cash Flow” shall have the meaning set forth in Section 9.3 hereof.
“Excess Cash Flow Account” shall have the meaning set forth in Section 8.5 hereof.
“Excess Cash Flow Funds” shall have the meaning set forth in Section 8.5 hereof.
“Exchange Act” shall mean the Securities and Exchange Act of 1934, as amended.
“Exchange Act Filing” shall have the meaning set forth in Section 11.1 hereof.
“Excluded Tax Reserve Tenant” shall mean those Persons identified on Schedule 8.6-B in the column titled “Tenant”.
“Excluded Tax Reserve Tenant Conditions” shall have the meaning set forth in Section 8.6 hereof.
“Excluded Taxes” shall mean any of the following Taxes imposed on or with respect to Lender or required to be withheld or deducted from a payment to Lender: (i) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (a) imposed as a result of Lender being organized under the laws of, or having its principal office or its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof), or (b) that are Other Connection Taxes, (ii) any U.S. federal withholding taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan pursuant to a law in effect on the date on which such Lender acquires such interest in the Loan, (iii) taxes attributable to Lender’s failure to comply with Section 2.5(b)(xiii) and (iv) any withholding taxes imposed under FATCA.
“Exculpated Parties” shall have the meaning set forth in Section 13.1 hereof.
“Extended Maturity Date” shall have the meaning set forth in Section 2.9 hereof.
“Extension Option” shall have the meaning set forth in Section 2.9 hereof.
“Extension Period” shall have the meaning set forth in Section 2.9 hereof.
“FATCA” shall mean Sections 1471 through 1474 of the IRS Code as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreement entered into pursuant to Section 1471(b)(1) of the IRS Code.
“First Monthly Payment Date” shall mean April 9, 2019.
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“Fiscal Quarter” means the 3-month period ending on March 31, June 30, September 30 and December 31 of each year.
“Fitch” shall mean Fitch, Inc.
“Flood Insurance Acts” shall have the meaning set forth in Section 7.1 hereof.
“Foreign Lender” shall mean a Lender that is not a U.S. Person.
“Friday’s Parcel” shall have the meaning set forth in Section 2.10(g)(xii) hereof.
“Funding Borrower” shall have the meaning set forth in Section 17.19 hereof.
“GAAP” shall mean generally accepted accounting principles in the United States of America as of the date of the applicable financial report.
“Governmental Authority” shall mean any court, board, agency, commission, office or other authority of any nature whatsoever for any governmental xxxx (xxxxxxx, xxxxx, xxxxxx, xxxxxxxx, xxxxxxxxx, xxxx or otherwise) whether now or hereafter in existence.
“Gross Income from Operations” shall mean, for any date of determination and based on the Properties secured by the Security Instruments and/or related to any Equity Interests (and the related Individual Puerto Rico Property) subject to the Pledge Agreement on such date of determination, (a) the sum of (i) total annualized base rent reflected in a current rent roll for all Tenants paying rent, open for business, in actual physical occupancy of their respective space demised pursuant to Leases (or, so long as such Lease is not a Lease with an Anchor Tenant, has a subtenant that complies with clause (4) below) which are in full force and effect and for which the Tenant thereunder is paying unabated rent, provided that this clause (a)(i) shall include any base rent under Leases as of the Closing Date that are in full force and effect but for which the rent commencement date has not yet occurred so long as any rent through the commencement date of the Lease, any free rent owed to such Tenant, together with all tenant improvements, tenant allowances and leasing commissions owed to such Tenant, have been deposited in the Unfunded Obligations Reserve Account, (ii) reimbursed expenses and or reimbursements, percentage and overage rent and income received from the Properties during the twelve (12) month period immediately preceding such date of determination, (iii) ancillary income (including, without limitation, income from reciprocal easement and similar agreements, parking, tenant services and signage) received during the twelve (12) month period immediately preceding such date of determination (without duplication of any amounts set forth in clauses (a)(i) and (ii) above) and (iv) provided there exists no Event of Default, funds released from the Restoration Abated Revenue Reserve pursuant to Section 8.13 applied to each impacted month within the twelve (12) month period immediately preceding the date of determination, but excluding (solely for purposes of calculating Net Cash Flow) one-time extraordinary income or non-recurring income; provided, that Gross Income from Operations shall be adjusted to (A) include reimbursements that would have been received by Borrower from Tenants pursuant to Leases had such taxes actually been payable with respect to the applicable Individual Property with respect to the Tax and Insurance Adjustment, (B) exclude rental income attributable to any Tenant (1) subject to a Bankruptcy Action and has not affirmed its Lease in the applicable bankruptcy proceeding pursuant to a final, non-appealable order of a court of competent jurisdiction, (2) not paying rent under its Lease or otherwise in default under its Lease for sixty
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(60) days or greater beyond any applicable notice and cure periods, (3) that has expressed its intention in writing to not renew, terminate, cancel and/or reject its applicable Lease and there are nine (9) months or less term remaining on such Lease as of the applicable date of calculation hereunder, and (4) who has ceased operations at its leased premises (i.e. “gone dark”) (unless such Tenant is subleasing the space demised under such Lease at market terms (with market terms determined as if such sublease was a direct lease between such subtenant and Borrower) and such sublease does not violate any co-tenancy provisions and/or similar provisions of the other Leases at the respective Individual Property), and (C) exclude payments made to Borrower and any Mezzanine Borrower pursuant to the Interest Rate Cap Agreement or any similar interest rate cap agreement with respect to any Mezzanine Loan. Notwithstanding the foregoing, if Borrower has not delivered a rent roll within the time frames required pursuant to Section 4.12 hereof and such failure has continued for five (5) Business Days following notice by Lender of such failure, then total annualized base rent pursuant to clause (a)(i) above shall be determined by Lender in its reasonable discretion.
“Ground Lease” shall mean, individually and/or collectively, as the context may require, those certain ground leases set forth on Schedule 1.1(e) attached hereto.
“Ground Lease Reserve Account” shall have the meaning set forth in Section 8.10 hereof.
“Ground Lease Reserve Funds” shall have the meaning set forth in Section 8.10 hereof.
“Ground Leased Property” shall mean, individually and/or collectively (as the context requires), all or any portion of any Individual Property that is subject to a Ground Lease.
“Ground Lessor” shall mean, individually and/or collectively, as the context may require, the lessor under each Ground Lease.
“Ground Rent” shall have the meaning set forth in Section 8.10 hereof.
“Ground Rent Adjustment” shall mean an adjustment to the calculation of Operating Expenses for imminent liabilities related to the Ground Lease and/or other increases in Ground Rent.
“Guarantor” shall mean Sponsor.
“Guaranty” shall mean that certain Limited Recourse Guaranty, dated as of the date hereof, executed and delivered by Guarantor in connection with the Loan to and for the benefit of Lender, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.
“Immediate Repair Account” shall have the meaning set forth in Section 8.1 hereof.
“Immediate Repair Funds” shall have the meaning set forth in Section 8.1 hereof.
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“Immediate Repairs” shall have the meaning set forth in Section 8.1 hereof.
“Improvements” shall mean, individually and/or collectively (as the context requires), the “Improvements” as defined in each applicable Security Instrument.
“Indebtedness” shall mean, for any Person, any indebtedness or other similar obligation for which such Person is obligated (directly or indirectly, by contract, operation of law or otherwise), including, without limitation, (i) all indebtedness of such Person for borrowed money (including, without limitation, indebtedness in the form of mezzanine debt, preferred equity or intercompany loans), for amounts drawn under a letter of credit, or for the deferred purchase price of property for which such Person or its assets is liable, (ii) all unfunded amounts under a loan agreement, letter of credit, or other credit facility for which such Person would be liable if such amounts were advanced thereunder, (iii) all amounts required to be paid by such Person by contract and/or as a guaranteed payment (including, without limitation, any such amounts required to be paid to partners and/or as a preferred or special dividend, including any mandatory redemption of shares or interests), (iv) all indebtedness incurred and/or guaranteed by such Person, directly or indirectly (including, without limitation, contractual obligations of such Person), (v) all obligations under leases that constitute capital leases for which such Person is liable, (vi) all obligations of such Person under interest rate swaps, caps, floors, collars and other interest hedge agreements, in each case whether such Person is liable contingently or otherwise, as obligor, guarantor or otherwise, or in respect of which obligations such Person otherwise assures a creditor against loss and (vii) any property-assessed clean energy loans or similar indebtedness, including, without limitation, if such loans or indebtedness are made or otherwise provided by any Governmental Authority and/or secured or repaid (directly or indirectly) by any taxes or similar assessments.
“Indemnified Person” shall mean Lender, any Affiliate of Lender and its designee (whether or not it is the Lender), that has filed any registration statement relating to the Securitization or has acted as the sponsor or depositor in connection with the Securitization, any Affiliate of Lender that acts as an underwriter, placement agent or initial purchaser of Securities issued in the Securitization, any other co-underwriters, co-placement agents or co-initial purchasers of Securities issued in the Securitization, and each of their respective officers, directors, partners, employees, representatives, agents and Affiliates and each Person or entity who Controls any such Person within the meaning of Section 15 of the Securities Act of 1933 as amended or Section 20 of the Security Exchange Act of 1934 as amended, Servicer (including any special servicer), any Person in whose name the encumbrance created by the Security Instruments is or will have been recorded, any Person who may hold or acquire or will have held a full or partial interest in the Loan secured hereby (including, but not limited to, investors in the Securities, as well as custodians, trustees and other fiduciaries who hold or have held a full or partial interest in the Loan secured hereby for the benefit of third parties) as well as the respective directors, officers, shareholders, partners, employees, agents, servants, representatives, contractors, subcontractors, affiliates, subsidiaries, participants, successors and assigns of any and all of the foregoing (including, but not limited to, any other Person who holds or acquires or will have held a participation or other full or partial interest in the Loan, whether during the term of the Loan or as a part of or following a foreclosure of the Loan and including, but not limited to any successors by merger, Division, consolidation or acquisition of all or a substantial portion of Lender’s assets and business) and any receiver or other fiduciary appointed in a foreclosure or other Creditors Rights Laws proceeding.
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“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of Borrower under any Loan Document and (b) to the extent not otherwise described in clause (a), Other Taxes.
“Indemnifying Person” shall mean Borrower.
“Independent Director” shall have the meaning set forth in Section 5.2 hereof.
“Individual Continental Property” shall mean each parcel of real property, the Improvements thereon and all personal property owned by a Continental Borrower and encumbered by the applicable Security Instrument, together with all rights pertaining to such property and Improvements, as more particularly described in the granting clauses of the applicable Security Instrument and referred to therein as the “Property.” For all purposes hereunder and the other Loan Documents, references to any Individual Continental Property shall also include any Combined Individual Property Parcel.
“Individual Property” shall mean, individually and/or collectively (as the context requires), any Individual Continental Property (including any Combined Individual Property Parcel) and any Individual Puerto Rico Property.
“Individual Puerto Rico Property” shall mean each parcel of real property, the PR Improvements or Improvements, as applicable, thereon and all personal property owned by any Puerto Rico Borrower.
“Information” shall have the meaning set forth in Section 11.8(b)(ii) hereof.
“Insurance Account” shall have the meaning set forth in Section 8.6 hereof.
“Insurance Payment Date” shall mean, with respect to any applicable Policies, the date occurring ten (10) Business Days prior to the date the applicable Insurance Premiums associated therewith are due and payable.
“Insurance Premiums” shall have the meaning set forth in Section 7.1 hereof.
“Intercreditor Agreement” shall have the meaning set forth in Section 17.21 hereof.
“Interest Accrual Period” shall mean the period beginning on (and including) the fifteenth (15th) day of each calendar month during the term of the Loan and ending on (and including) the fourteenth (14th) day of the next succeeding calendar month. No Interest Accrual Period shall be shortened by reason of any payment of the Loan prior to the expiration of such Interest Accrual Period.
“Interest Rate” shall mean the rate or rates at which the outstanding principal amount of the Loan bears interest from time to time as determined accordance with the provisions of Section 2.5 hereof.
“Interest Rate Cap Agreement” shall mean, as applicable, any interest rate cap agreement (together with the confirmation and schedules relating thereto) in form and substance
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satisfactory to Lender between Borrower and Counterparty, any Replacement Interest Rate Cap Agreement, Converted Interest Rate Cap Agreement or Substitute Interest Rate Cap Agreement, in each case which also satisfies the requirements set forth in Section 2.8.
“Interest Shortfall” shall mean, (i) with respect to any repayment or prepayment of the Loan made on a date that is not a Monthly Payment Date, the interest which would have accrued on the Loan (absent such repayment or prepayment) through and including the last day of the Interest Accrual Period for the Monthly Payment Date immediately succeeding the date of such repayment or prepayment, and (ii) with respect to any repayment or prepayment of the Loan (including a repayment on the Maturity Date) made on a date that is a Monthly Payment Date, the interest which would have accrued on the Loan (absent such repayment or prepayment) through and including the last day of the Interest Accrual Period related to such Monthly Payment Date.
“Investor” shall mean any investor or potential investor in the Loan (or any portion thereof or interest therein) in connection with any Secondary Market Transaction.
“IRS Code” shall mean the Internal Revenue Code of 1986, as amended.
“JPM” shall have the meaning set forth in the introductory paragraph hereto.
“KBRA” shall mean Xxxxx Bond Rating Agency, Inc.
“Land” shall mean (a) with respect to the Plaza del Sol Property and each Individual Continental Property, individually and/or collectively (as the context requires), the “Land” as defined in each applicable Security Instrument and (b) with respect to each Individual Puerto Rico Property (other than the Plaza del Sol Property which is addressed in the foregoing clause (a)), the PR Land.
“Lease” shall mean (a) with respect to the Plaza del Sol Property and each Individual Continental Property, “Lease” as defined in each Security Instrument and (b) with respect to each Individual Puerto Rico Property (other than the Plaza del Sol Property which is addressed in the foregoing clause (a)), all leases, subleases, subsubleases, lettings, licenses, concessions or other agreements (whether written or oral) pursuant to which any Person is granted a possessory interest in, or right to use or occupy all or any portion of the PR Land and the Improvements on such PR Land, and every modification, amendment or other agreement relating to such leases, subleases, subsubleases, or other agreements entered into in connection with such leases, subleases, subsubleases, or other agreements and every guarantee of the performance and observance of the covenants, conditions and agreements to be performed and observed by the other party thereto, heretofore or hereafter entered into, whether before or after the filing by or against Puerto Rico Borrower of any petition for relief under any Creditors Rights Laws.
“Leasing Reserve Account” shall have the meaning set forth in Section 8.3 hereof.
“Leasing Reserve Funds” shall have the meaning set forth in Section 8.3 hereof.
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“Leasing Reserve Monthly Deposit” shall mean, for each date of determination, one-twelfth (1/12th) of the amount equal to the Aggregate Square Footage at the Plaza del Sol Property and at each Individual Continental Property multiplied by One Dollar ($1.00).
“Legal Requirements” shall mean all federal, state, county, municipal and other governmental statutes, laws, rules, orders, regulations, ordinances, judgments, decrees and injunctions of Governmental Authorities affecting Borrower, Pledgor, Additional Obligor, SPE Component Entity, the Collateral (or any part thereof) or the Property or any part thereof, or the construction, use, alteration or operation thereof, or any part thereof, whether now or hereafter enacted and in force, including, without limitation, the Americans with Disabilities Act of 1990, and all Permits, authorizations and regulations relating thereto.
“Lender Affiliate” shall have the meaning set forth in Section 11.2 hereof.
“Lender Group” shall have the meaning set forth in Section 11.2 hereof.
“Letter of Credit” shall mean an irrevocable, auto-renewing, unconditional, transferable, clean sight draft standby letter of credit having an initial term of not less than one (1) year and with automatic renewals for one (1) year periods (unless the obligation being secured by, or otherwise requiring the delivery of, such letter of credit is required to be performed at least thirty (30) days prior to the initial expiry date of such letter of credit), for which Borrower shall have no reimbursement obligation and which reimbursement obligation is not secured by the Property, the Collateral or any other property pledged to secure the Note, in favor of Lender and entitling Lender to draw thereon in New York, New York, based solely on a statement that Lender has the right to draw thereon executed by an officer or authorized signatory of Lender. A Letter of Credit must be issued by an Approved Bank. Borrower’s delivery of any Letter of Credit hereunder (when taken in the aggregate with all other Letters of Credit hereunder, if any) equals or exceeds ten percent (10%) of the original principal balance of the Loan shall, at Lender’s option, be conditioned upon Lender’s receipt of a New Non-Consolidation Opinion relating to such Letter of Credit.
“Liabilities” shall mean any actual, out-of-pocket losses, claims, damages (other than consequential, special or punitive damages), liabilities, costs or expenses (including without limitation reasonable legal fees and expenses for enforcement of any obligations of any Borrower Party).
“LIBOR” shall mean, with respect to each Interest Accrual Period, the rate (expressed as a percentage per annum and rounded upward, as necessary, to the next nearest 1/1000 of 1%) equal to the rate reported for deposits in U.S. dollars, for a one-month period, that appears on Reuters Screen LIBOR01 Page (or the successor thereto) as of 11:00 a.m., London time, on the related Determination Date; provided that, (i) if such rate does not appear on Reuters Screen LIBOR01 Page as of 11:00 a.m., London time, on such Determination Date, Lender shall request the principal London office of any four major reference banks in the London interbank market selected by Lender to provide such bank’s offered quotation (expressed as a percentage per annum) to prime banks in the London interbank market for deposits in U.S. dollars for a one-month period as of 11:00 a.m., London time, on such Determination Date for the amounts for a comparable loan at the time of such calculation and, if at least two such offered quotations are so provided, LIBOR shall be the arithmetic mean of such quotations; and (ii) if fewer than two such quotations in clause (i) are so provided, Lender shall request any three major banks in New York City selected by Lender to provide such bank’s rate (expressed as a percentage per annum) for
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loans in U.S. dollars to leading European banks for a one-month period as of approximately 11:00 a.m., New York City time on the applicable Determination Date for the amounts for a comparable loan at the time of such calculation and, if at least two such rates are so provided, LIBOR shall be the arithmetic mean of such rates; and (iii) notwithstanding anything to the contrary contained herein, in no event shall LIBOR be less than zero percent (0%). Lender’s computation of LIBOR shall be conclusive and binding on Borrower for all purposes, absent manifest error. Notwithstanding anything to the contrary contained herein or in any other Loan Document, in no event shall Lender be required to disclose to Borrower or any other Person the identity, offered quotations or rates, in each case, of any of the reference banks or other banks referred to in this definition.
“LIBOR Conversion” shall have the meaning set forth in Section 2.8(i) hereof.
“LIBOR Loan” shall mean the Loan at such time as interest thereon accrues at a rate of interest equal to the LIBOR Rate for each Component.
“LIBOR Rate” shall mean the sum of (i) LIBOR and (ii) the LIBOR Spread.
“LIBOR Spread” shall mean, with respect to each Component of the Loan, as the same, the following amounts, as the same may be reallocated pursuant to Section 11.1(b) hereof:
(a) |
Component A, 2.50%; |
(b) |
Component B, 2.50%; |
(c) |
Component C, 2.50%; and |
(d) |
Component H-RR, 2.50%; |
the LIBOR Spread shall be increased by (x) 25 basis points (0.25%) from and after the first day of the third Extension Period in accordance with Section 2.9(g), without duplication of any increase with respect to the Alternate Rate Spread or the Prime Rate Spread in accordance with Section 2.9(g).
“LLC Agreement” shall have the meaning set forth in Section 5.1(c) hereof.
“Loan” shall mean the loan made by Lender to Borrower pursuant to this Agreement.
“Loan Bifurcation” shall have the meaning set forth in Section 11.1 hereof.
“Loan Documents” shall mean, collectively, this Agreement, the Note, the Security Instrument, the Pledge Agreement, the Environmental Indemnity, the Assignment of Management Agreement, the Collateral Assignment of Interest Rate Cap Agreement, the Restricted Account Agreement, the Cash Management Agreement, the Post-Closing Agreement, the Casualty Proceeds Restricted Account Agreement, the Guaranty, the Pledgor Guaranty, the Borrower’s Certificate and all other documents executed and/or delivered in connection with the
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Loan, as each of the same may be amended, restated, replaced, extended, renewed, supplemented or otherwise modified from time to time.
“Loan-to-Value Ratio” shall mean, as of the date of its calculation, the ratio of (a) the outstanding principal amount of the Loan as of the date of such calculation to (b) the fair market value of the Plaza del Sol Property and the Individual Continental Properties (for purposes of the REMIC Requirements, counting only real property and excluding any personal property or going concern value), as Borrower shall have established to Lender’s reasonable satisfaction based upon valuations obtained by Borrower at its sole cost and expense by, to the extent permitted to a REMIC Trust, a broker’s price opinion of value or an existing or updated appraisal or any other written determination of value that is a commercially reasonable method permitted to a REMIC Trust. For the avoidance of doubt, the outstanding principal balance of the Mezzanine Loans will not be included in the calculation of Loan-to-Value Ratio for purposes of the REMIC provisions.
“London Business Day” shall mean any day other than a Saturday, Sunday or any other day on which commercial banks in London, England are not open for business.
“Longhorn Parcel” shall have the meaning set forth in Section 2.10(g)(xii) hereof.
“Losses” shall mean any and all actual, out-of-pocket losses, damages (other than consequential, special or punitive damages), costs, fees, expenses, claims, suits, judgments, awards, liabilities (including but not limited to strict liabilities), obligations, debts, diminutions in value (to the extent such diminutions in value result in an Indemnified Person actually receiving less than the full amount of the Debt due to such Indemnified Person under the Loan Documents), fines, penalties, charges, amounts paid in settlement, litigation costs and reasonable attorneys’ fees, in the case of each of the foregoing, of whatever kind or nature and whether or not incurred in connection with any judicial or administrative proceedings, actions, claims, suits, judgments or awards; provided, however, that in no event shall Losses include a loss of opportunity or special or punitive damages or (except as expressly set forth above with respect to diminutions in value) consequential damages except to the extent payable by Lender to a third party.
“Major Lease” shall mean (i) any Lease which demises 50,000 square feet or more of the Plaza del Sol Property or the applicable Individual Continental Property’s gross leasable area, as applicable, (ii) any Lease which contains any option, offer, right of first refusal or other similar entitlement to acquire or encumber all or any portion of the Plaza del Sol Property or the Individual Continental Property, as applicable, (iii) any Lease at the Plaza del Sol Property or any Individual Continental Property with any Borrower Party or Site Centers and/or any Affiliate thereof as tenant, as applicable, (iv) any Lease at the Plaza del Sol Property or any Individual Continental Property, as applicable, entered into in during the continuance of an Event of Default, and (v) any instrument guaranteeing or providing credit support for any Lease at the Plaza del Sol Property or any Individual Continental Property, as applicable, meeting the requirements of (i), (ii), (iii) and/or (iv) above.
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“Management Agreement” shall mean, individually and/or collectively (as the context may require), (i) each management agreement entered into by and between Borrower and Manager, pursuant to which Manager is to provide management and other services with respect to the Property or any portion thereof, as the same may be amended, restated, replaced, extended, renewed, supplemented or otherwise modified from time to time and (ii) each sub-management agreement entered into by Manager and Sub-Manager pursuant to which Sub-Manager is to provide management and other services with respect to the Property or any portion thereof, as the same may be amended, restated, replaced, extended, renewed, supplemented or otherwise modified from time to time.
“Management Fee Cap” shall mean, with respect to each Individual Property, the aggregate of base management fees and sub-management fees equal to (a) with respect to each Individual Continental Property, 3.5% of Gross Income from Operations for such Individual Continental Property and (b) with respect to each Individual Puerto Rico Property, 5.5% of Gross Income from Operations for such Individual Puerto Rico Property.
“Manager” shall mean (i) with respect to each Individual Property, the Person as set forth on Schedule 1.1(f) hereto, (ii) such other Person selected as the manager of any applicable Individual Property in accordance with the terms of this Agreement or the other Loan Documents or (iii) any Sub-Manager.
“Material Action” shall mean with respect to any Person, any action to consolidate, divide or otherwise engage in or permit any Division, or merge such Person with or into any Person, or sell all or substantially all of the assets of such Person (other than in accordance with Section 2.10 of this Agreement), or to institute proceedings to have such Person be adjudicated bankrupt or insolvent, or consent to the institution of bankruptcy or insolvency proceedings against such Person or file a petition seeking, or consent to, reorganization or relief with respect to such Person under any applicable federal or state law relating to bankruptcy, or consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of such Person or a substantial part of its property, or make any assignment for the benefit of creditors of such Person, or admit in writing such Person’s inability to pay its debts generally as they become due, or take action in furtherance of any such action, or, to the fullest extent permitted by law, dissolve or liquidate such Person.
“Material Adverse Effect” shall mean a material adverse effect on (i) the use, value, operation or possession of any Individual Property, (ii) the financial condition of any Borrower Party, any Collateral or any Individual Property, (iii) the enforceability, validity, perfection or priority of the lien of the Security Instrument or the other Loan Documents, or (iv) the ability of any Borrower Party to perform its obligations under the Security Instrument or the other Loan Documents to which it is a party. For the avoidance of doubt, the Prior Hurricane Damage and the PR Restoration (so long as Borrower complies with the provisions set forth in Section 4.29 hereof) shall not be deemed a Material Adverse Effect.
“Maturity Date” shall mean the Stated Maturity Date, as such date may be extended pursuant to and in accordance with Section 2.9 hereof, or such other date on which the final payment of the principal amount of the Loan becomes due and payable as herein provided, whether at the Stated Maturity Date, by declaration of acceleration, or otherwise.
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“Maximum Legal Rate” shall mean the maximum non-usurious interest rate, if any, that at any time or from time to time may be contracted for, taken, reserved, charged or received on the indebtedness evidenced by the Note and as provided for herein or the other Loan Documents, under the laws of such state or states whose laws are held by any court of competent jurisdiction to govern the interest rate provisions of the Loan.
“Member” is defined in Section 5.1 hereof.
“Mezzanine Borrower” shall mean any borrower under a New Mezzanine Loan.
“Mezzanine Lender” shall mean any New Mezzanine Lender, together with its successors and assigns.
“Mezzanine Loan Agreement” shall mean the New Mezzanine Loan Agreement, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.
“Mezzanine Loan Default” shall mean a New Mezzanine Loan Default.
“Mezzanine Loan Documents” shall mean the New Mezzanine Loan Documents, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.
“Mezzanine Loans” shall mean any New Mezzanine Loan.
“Minimum Counterparty Rating” shall mean a Counterparty (or the guarantor of such Counterparty’s ratings) that has (a) a long-term unsecured debt rating of “A-” or higher by S&P, which rating shall not include a “t” or otherwise reflect a termination risk or otherwise be qualified; (b) a long-term unsecured debt rating of not less than “A3” by Moody’s which rating shall not include a “t” or otherwise reflect a termination risk or otherwise be qualified; and (c) if the Counterparty (or the guarantor of such Counterparty’s ratings) and if any of the Securities are rated by Fitch, a long-term unsecured debt rating of “A-” (and not on Rating Watch Negative) or higher by Fitch and a short-term unsecured debt rating of not less than “F‑1” (and not on Rating Watch Negative) from Fitch (and, after a Securitization, the equivalent of the foregoing by the other Rating Agencies). After a Securitization of the Loan, only the ratings of those Rating Agencies rating the Securities shall apply. Notwithstanding anything to the contrary, SMBC Capital Markets, Inc. shall qualify as a Counterparty hereunder and shall be deemed to satisfy the Minimum Counterparty Ratings so long as SMBC Capital Markets, Inc.’s obligations under the Interest Rate Cap Agreement (or Replacement Interest Rate Cap Agreement, Converted Interest Rate Cap Agreement or Substitute Interest Rate Cap Agreement, as applicable) delivers a guaranty substantially similar to those being used on comparable securitized transactions at such time and from an affiliate satisfying the foregoing Minimum Counterparty Ratings.
“Minimum Debt Yield” shall mean a Debt Yield of 12.65%.
“Minimum Disbursement Amount” shall mean Fifteen Thousand and No/100 Dollars ($15,000).
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“Minimum Release Price” shall mean the amount described in clauses (A)(i)(b) and (ii)(b) of the definition of “Release Price.”
“Monthly Debt Service Payment Amount” shall mean, for the First Monthly Payment Date and for each Monthly Payment Date occurring thereafter, a payment equal to the amount of interest which has accrued and will accrue, in each case, during the Interest Accrual Period in which such Monthly Payment Date occurs computed at the Interest Rate.
“Monthly Excess Cash Flow Deposit” shall have the meaning set forth in Section 8.5 hereof.
“Monthly Ground Rent Deposit” shall have the meaning set forth in Section 8.10 hereof.
“Monthly Insurance Deposit” shall have the meaning set forth in Section 8.6 hereof.
“Monthly Payment Date” shall mean the First Monthly Payment Date and the ninth (9th) day of every calendar month occurring thereafter during the term of the Loan.
“Monthly Tax Deposit” shall have the meaning set forth in Section 8.6 hereof.
“Moody’s” shall mean Xxxxx’x Investors Service, Inc.
“Mortgage Mandatory Prepayment Amount” shall have the meaning set forth in Section 2.7(c) hereof.
“Mortgaged Portfolio” shall mean, collectively, the Individual Continental Properties and the Plaza del Sol Property.
“MS” shall have the meaning set forth in the introductory paragraph hereto.
“Net Cash Flow” shall mean, for any date of determination, the amount obtained by subtracting (i) Operating Expenses for the previous twelve (12) month period from (ii) Gross Income from Operations.
“Net Proceeds” shall mean: (i) the net amount of all insurance proceeds payable to or on behalf of Borrower as a result of a Casualty to any Individual Property, after deduction of reasonable costs and expenses (including, but not limited to, reasonable attorneys’ fees), if any, in collecting such insurance proceeds, or (ii) the net amount of the Award to or on behalf of Borrower, after deduction of reasonable costs and expenses (including, but not limited to, reasonable attorneys’ fees), if any, in collecting such Award.
“Net Proceeds Deficiency” shall have the meaning set forth in Section 7.4 hereof.
“Net Sales Proceeds” shall mean, with respect to any Individual Property, an amount equal to (a) the gross sales price and all other consideration from whatever source derived from the sale of such Individual Property less (b) (i) reasonable, demonstrable,
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out‑of‑pocket, third party, customary closing costs, (ii) reasonable, customary and market brokerage fees and sales commissions payable to unaffiliated third parties, (iii) transfer taxes actually incurred by Borrower in connection with such sale, (iv) reasonable and customary reserves or escrows required pursuant to the purchase and sale agreement entered into in connection with the sale of such Individual Property and (v) amounts deposited into the Required REIT Distributions and Tax Account.
“Net Sales Proceeds Amount” shall mean the amount described in clauses (A)(i)(a) and (ii)(a) of the definition of “Release Price.”
“New Manager” shall mean any Person replacing or becoming the assignee of the then current Manager, in each case, in accordance with the applicable terms and conditions hereof.
“New Mezzanine Borrower” shall have the meaning set forth in Section 11.6 hereof.
“New Mezzanine Lender” shall mean the lender under the New Mezzanine Loan.
“New Mezzanine Loan” shall have the meaning set forth in Section 11.6 hereof.
“New Mezzanine Loan Agreement” shall mean the loan agreement evidencing any New Mezzanine Loan.
“New Mezzanine Loan Default” shall have the meaning ascribed to the term “Event of Default” in the New Mezzanine Loan Documents.
“New Mezzanine Loan Documents” shall mean the documents evidencing any New Mezzanine Loan.
“New Mezzanine Option” shall have the meaning set forth in Section 11.6 hereof.
“New Non-Consolidation Opinion” shall mean a substantive non-consolidation opinion provided by Xxxxx Day or another outside counsel reasonably acceptable to Lender and acceptable to the Rating Agencies and otherwise in form and substance reasonably acceptable to Lender and acceptable to the Rating Agencies.
“Non-Conforming Policy” shall have the meaning set forth in Section 7.1 hereof.
“Non-Consolidation Opinion” shall mean that certain substantive non-consolidation opinion delivered to Lender by Xxxxx Day in connection with the closing of the Loan.
“Non-Disturbance Agreement” shall have the meaning set forth in Section 4.14 hereof.
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“Non-REIT Borrowers” shall mean those individual Continental Borrowers that are wholly owned by Retail Value TRS LLC, RVT TRS Mezz Borrower 2 LLC and RVT TRS Mezz Borrower 1 LLC. As of the Closing Date, the Non-REIT Borrowers are listed on Schedule 6.3(iii) hereto.
“Northeast Shopping Center Parcel” shall have the meaning set forth in Section 2.10(g)(xii) hereof.
“Northwest Shopping Center Parcel” shall have the meaning set forth in Section 2.10(g)(xii) hereof.
“Note” shall mean, individually and/or collectively (as the context may require), Note A‑1, Note A‑2 and Note A‑3, as the same may be amended, restated, replaced, extended, renewed, supplemented, severed, split, or otherwise modified from time to time.
“Note A‑1” shall mean that certain Replacement, Amended and Restated Promissory Note A‑1 of even date herewith in the principal amount of $540,000,000.00, made by Borrower in favor of CF, as the same may be amended, restated, replaced, extended, renewed, supplemented, severed, split, or otherwise modified from time to time.
“Note A‑2” shall mean that certain Replacement, Amended and Restated Promissory Note A‑2 of even date herewith in the principal amount of $180,000,000.00, made by Borrower in favor of JPM, as the same may be amended, restated, replaced, extended, renewed, supplemented, severed, split, or otherwise modified from time to time.
“Note A‑3” shall mean that certain Replacement, Amended and Restated Promissory Note A‑3 of even date herewith in the principal amount of $180,000,000.00, made by Borrower in favor of MS, as the same may be amended, restated, replaced, extended, renewed, supplemented, severed, split, or otherwise modified from time to time.
“Nova” shall mean (i) Nova Consulting Group, Inc., or (ii) if Nova is no longer providing services substantially similar to those provided on or about the Closing Date, any other continental United States based environmental and construction consultant acceptable to Lender and provided no Event of Default has occurred and is continuing, reasonably approved by Borrower, including, in each case, their respective authorized agents and representatives.
“O&M Program” shall have the meaning set forth in the Environmental Indemnity.
“Obligations” shall have the meaning set forth in Section 17.19 hereof.
“OFAC” shall have the meaning set forth in Section 3.30 hereof.
“Officer’s Certificate” shall mean a certificate delivered to Lender by Borrower which is signed by Responsible Officer of Borrower.
“Op Ex Monthly Deposit” shall have the meaning set forth in Section 8.4 hereof.
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“Open Period Date” shall mean April 9, 2020.
“Operating Expense Account” shall have the meaning set forth in Section 8.4 hereof.
“Operating Expense Funds” shall have the meaning set forth in Section 8.4 hereof.
“Operating Expenses” shall mean the total of all expenditures, computed in accordance with the Approved Accounting Method, of whatever kind relating to the operation, maintenance and management of the Properties that are secured by the Security Instruments on such date of calculation and that are incurred on a regular monthly or other periodic basis, including without limitation, (and without duplication) (a) utilities, ordinary repairs and maintenance, insurance, license fees, ground rent, common charges, property taxes and assessments, advertising expenses, payroll and related taxes, computer processing charges, management and sub-management fees (equal to the greater of (x) (i) with respect to the Individual Continental Properties, three and one-half percent (3.5%) of Gross Income from Operations of the Individual Continental Properties or (ii) with respect to the Individual Puerto Rico Properties, five and one-half percent (5.5%) of Gross Income from Operations of the Individual Puerto Rico Properties or (y) actual management and sub-management fees payable under the applicable Management Agreement, as applicable), operational equipment or other lease payments as set forth in the Annual Budget or Approved Annual Budget, as applicable, as reasonably approved by Lender, (b) the Ground Rent Adjustment, (c) the Condominium Charges Adjustment, and (d) the Tax and Insurance Adjustment, but specifically excluding (i) depreciation, amortization and any other non-cash items, (ii) Debt Service and Mezzanine Loan Debt Service, (iii) non-recurring or extraordinary expenses, (iv) deposits into the Reserve Funds, (v) Sponsor Corporate Expenses and (vi) Site Centers Shared Services Fees.
“Organizational Chart” shall have the meaning set forth in Section 3.31 hereof.
“Other Charges” shall mean all maintenance charges, impositions other than Taxes, and any other charges, vault charges and license fees for the use of vaults, chutes and similar areas adjoining the Property, now or hereafter levied or assessed or imposed by a Governmental Authority against the Property or any part thereof and payable by Borrower.
“Other Connection Taxes” shall mean taxes imposed as a result of a present or former connection between Lender and the jurisdiction imposing such tax (other than connections arising from Lender having executed, delivered, become a party to, performed its obligations under, received payments under, received a perfected security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).
“Other Taxes” shall mean all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment.
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“Outparcel” shall mean that certain parcel located at the Individual Property commonly known as Uptown Solon and described in Schedule 2.15 attached hereto.
“Outparcel Release” shall have the meaning set forth in Section 2.15 hereof.
“Outparcel Release Approval Item” shall have the meaning set forth in Section 2.15 hereof.
“Palma Real Property” shall mean that certain Individual Property commonly known as Palma Real.
“Partial Release” shall have the meaning set forth in Section 2.10 hereof.
“Partial Release Approval Item” shall have the meaning set forth in Section 2.10 hereof.
“Partial Release Notice Date” shall have the meaning set forth in Section 2.10 hereof.
“Participant” shall have the meaning set forth in Section 11.8(a)(ix) hereof.
“Patriot Act” shall have the meaning set forth in Section 3.30 hereof.
“PBO Taxes” shall have the meaning set forth in Section 8.6 hereof.
“Peach Street Ground Lease” shall have the meaning set forth in Schedule 1.1(e) hereof.
“Permits” shall mean all necessary certificates, licenses, permits, franchises, trade names, certificates of occupancy, consents, and other approvals (governmental and otherwise) required under applicable Legal Requirements for the operation of each Individual Property and the conduct of Borrower’s business (including, without limitation, all required zoning, building code, land use, environmental, public assembly and other similar permits or approvals).
“Permitted Encumbrances” shall mean, with respect to each Individual Property, collectively, (a) the lien and security interests created by this Agreement and the other Loan Documents, (b) all liens, encumbrances and other matters disclosed in the applicable Title Insurance Policy, (c) liens, if any, for Taxes imposed by any Governmental Authority not yet delinquent or which are being contested in accordance with the terms of this Agreement, (d) existing Leases and new Leases entered into in accordance with this Agreement, (e) such other title and survey exceptions as Lender has approved or may approve in writing in Lender’s reasonable discretion, (f) any workers’, mechanics’ or similar liens on an Individual Property that are bonded or discharged in accordance with this Agreement within forty-five (45) days after Borrower first received written notice of such lien, (g) any liens that are being contested in accordance with the terms of this Agreement, (h) rights of Tenants, as Tenants only, under Leases permitted hereunder, (i) all liens and security interests that are in connection with a Permitted Equipment Lease, (j) all immaterial easements, rights-of-way, restrictions and other
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similar encumbrances recorded against and affecting such Individual Property so long as the same are entered into in the ordinary course of Borrower’s business (but in no event in connection with the borrowing of money or the obtaining of advances or credit) and do not (1) interfere with the ordinary conduct of the business of Borrower or (2) have a Material Adverse Effect, (k) any easements, restrictions, covenants, reservations and rights of way for access, water and sewer lines, telephone, cable or other fiber optic or other data transaction lines, electric lines or other utilities or for other similar purposes entered into in accordance with the terms and conditions of Section 6.4 hereof, (l) liens created against the Property in error or by any Tenant or third party with respect to a Lease so long as (1) Borrower is diligently exercising its rights and remedies under the applicable Leases, other agreement or otherwise against such Tenant or third party to have such liens removed and (2) such liens do not (A) interfere with the ordinary conduct of the business of Borrower or (B) have a Material Adverse Effect, and (m) the liens and security interests created by the Mezzanine Loan Documents.
“Permitted Equipment Leases” shall mean equipment leases or other similar instruments entered into with respect to the Personal Property; provided, that, in each case, such equipment leases or similar instruments (i) are entered into on commercially reasonable terms and conditions in the ordinary course of Borrower’s business and (ii) relate to Personal Property which is (A) used in connection with the operation and/or maintenance of the applicable Individual Property in the ordinary course of Borrower’s business and (B) readily replaceable without material interference or interruption to the operation of the applicable Individual Property.
“Permitted Investments” shall mean “permitted investments” as then defined and required by the Rating Agencies.
“Person” shall mean any individual, corporation, partnership, joint venture, limited liability company, estate, trust, unincorporated association, any federal, state, county or municipal government or any bureau, department or agency thereof and any other entity and, in each case, any fiduciary acting in such capacity on behalf of any of the foregoing.
“Personal Property” shall mean, individually and/or collectively (as the context requires), the “Personal Property” as defined in each applicable Security Instrument.
“Plan” shall have the meaning set forth in Section 2.15 hereof.
“Plaza del Norte Property” shall mean that certain Individual Property commonly known as Plaza del Norte.
“Plaza del Sol Borrower” means DDR Del Sol LLC, S.E., a Delaware limited liability company.
“Plaza del Sol Property” shall mean that certain Individual Property commonly known as Plaza del Sol.
“Plaza Del Sol Restoration Expenditures” shall have the meaning set forth in Section 8.16 hereof.
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“Plaza Del Sol Restoration Reserve Account” shall have the meaning set forth in Section 8.16 hereof.
“Plaza Del Sol Restoration Reserve Cap” shall mean an amount equal to the positive difference between (i) $11,540,000.00 minus (ii) (a) Casualty Proceeds actually received by Borrower as a result of claims made following the Prior Hurricane Damage (Plaza del Sol) and allocated to the Plaza del Sol Property, (b) equity (which, for clarity, may include funds drawn on a Corporate Loan by Sponsor or any direct or indirect beneficial or equity owner in the Sponsor and) actually contributed to the Plaza del Sol Property and used to undertake the PR Restoration at the Plaza Del Sol Property and (c) Excess Cash Flow actually used to undertake the PR Restoration at the Plaza Del Sol Property. For the avoidance of doubt, Reserve Funds disbursed to Borrower shall not be taken into account when calculating the Plaza Del Sol Restoration Reserve Cap.
“Plaza Del Sol Restoration Reserve Funds” shall have the meaning set forth in Section 8.16 hereof.
“Plaza Del Sol Restoration Reserve Monthly Deposit” shall mean, on each applicable Monthly Payment Date, $420,000.00.
“Pledge Agreement” shall mean that certain Pledge Agreement (Mortgage Loan), dated as of the date hereof, by Pledgor in favor of Lender, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.
“Pledgor” shall mean, individually and/or collectively (as the context requires), RVT PR Mezz Borrower 1 LLC.
“Pledgor Guaranty” shall mean that certain Pledgor Guaranty, dated as of Closing Date, executed and delivered by Pledgor in connection with the Loan to and for the benefit of Lender, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.
“Policies” shall have the meaning set forth in Section 7.1 hereof.
“Post-Closing Agreement” shall mean that certain Post-Closing Obligations Agreement, dated as of the date hereof, by and between Borrower and Lender, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.
“PR Improvements” shall mean buildings, fixtures, additions, enlargements, extensions, modifications, repairs, replacements and improvements now or hereafter erected or located on the PR Land or solely with respect to the Plaza del Sol Property, the Land.
“PR Land” shall mean the real property described in Exhibit B attached hereto and made a part hereof.
“PR Portfolio Release Approval Item” shall have the meaning set forth in Section 2.14 hereof.
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“PR Portfolio Release Notice Date” shall have the meaning set forth in Section 2.14 hereof.
“PR Property Representation Condition” shall mean, with respect to each representation and/or warranty contained herein or in any Loan Document made by Borrower for each Puerto Rico Portfolio Property, that such representation and/or warranty is made subject to: (a) the present and actual knowledge of Xxxxxxx Xxxxxxxx as of the Closing Date, without any duty of inquiry or to investigate or to update any such representations or warranties unless Xxxxxxx Xxxxxxxx should have actual knowledge that such representation or warranty is false or misleading in any material respect (Lender acknowledges and agrees that the foregoing individual is identified solely for the purpose of defining the scope of knowledge and not for the purpose of imposing any liability upon such individual or creating any duties running from such individual to Borrower, Guarantor, Lender or any other party), (b) any inaccuracy of such representation or warranty caused by, or on account of, the Prior Hurricane Damage or any PR Restoration, and (c) any matters disclosed by or referenced in any due diligence, reports or investigations conducted or obtained by Lender in connection with the Loan including, without limitation, any damage assessment reports, property condition reports, environmental site assessments, surveys, any Title Insurance Policy and/or any Zoning Report. Notwithstanding anything to the contrary contained herein, under no circumstances shall the PR Property Representation Condition apply to the Plaza del Sol Borrower or the Plaza del Sol Property, as applicable.
“PR Restoration” shall mean the repair of, or alterations to, any Affected Individual PR Property (or any portion thereof) and/or the completion of the repair, alteration and/or restoration of any Affected Individual PR Property (or any portion thereof) resulting from the Prior Hurricane Damage and the Prior Hurricane Damage (Plaza del Sol), as applicable, with such repairs and alterations being conducted and completed in accordance with the PR Restoration Budget, all applicable Legal Requirements and this Agreement.
“PR Restoration Budget” shall mean with respect to any PR Restoration at an Affected Individual PR Property, a budget attached hereto as Schedule 4.29 and revised from time to time, by Borrower in Borrower’s commercially reasonable business judgment, detailing the costs projected to be incurred by Borrower in connection with such PR Restoration at each Affected Individual PR Property.
“Prepayment Failure” shall have the meaning specified in Section 2.7(b) hereof.
“Prepayment Notice” shall have the meaning specified in Section 2.7(b) hereof.
“Prepayment Premium” shall mean (1) with respect to any voluntary repayment, prepayment or release prepayment of all or any portion of the outstanding principal amount of the Loan (or any Component thereof) prior to the Open Period Date, a payment to Lender in an amount equal to the product of (a) the weighted average LIBOR Spread (or Prime Rate Spread or Alternate Rate Spread, as applicable (but in no event less than the LIBOR Spread)) applicable to the portion of the Loan (or any Component thereof) which is being repaid, (b) the amount of the Debt being repaid or prepaid, and (c) a fraction, the numerator of which is the number of days remaining from and including the date that such repayment or prepayment is made, through (and
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including) the last day of the Interest Accrual Period during which the Open Period Date occurs and the denominator of which is 360, and (2) an amount equal to zero dollars ($0.00) with respect (a) to any prepayment or repayment made on or after the Open Period Date, (b) to any prepayment or repayment made prior to the Open Period Date in connection with a Partial Release of an Individual Property pursuant to Section 2.10 hereof or the release of the Puerto Rico Portfolio pursuant to Section 2.14 hereof, or (c) to any prepayment or repayment made prior to the Open Period Date in accordance with a Casualty or Condemnation.
“Previously-Owned Property” shall mean those properties previously owned by one or more Borrowers and set forth on Schedule 1.1(j) hereto, which properties are all outparcels or adjacent property to the applicable Individual Property referenced on Schedule 1.1(j) hereto.
“Previously-Owned Property Sale Agreements” shall mean those certain purchase and sale agreements relating to the Previously-Owned Properties.
“Prime Index Rate” shall mean, with respect to each Interest Accrual Period, the rate of interest published in The Wall Street Journal from time to time as the “Prime Rate” for the U.S. on the related Determination Date. If more than one “Prime Rate” for the U.S. is published in The Wall Street Journal for a day, the average of such “Prime Rates” shall be used, and such average shall be rounded up to the nearest 1/100th of one percent (0.01%). If The Wall Street Journal ceases to publish the “Prime Rate” for the U.S., Lender shall select an equivalent publication that publishes such “Prime Rate,” and if such “Prime Rates” are no longer generally published or are limited, regulated or administered by a governmental or quasigovernmental body, then Lender shall select a comparable interest rate index.
“Prime Rate” shall mean, with respect to each Interest Accrual Period, the per annum rate of interest equal to the Prime Index Rate plus the Prime Rate Spread for each Component; provided, however, that the Prime Rate shall not be less than the LIBOR Spread for the applicable Component.
“Prime Rate Loan” shall mean the Loan at such time as interest thereon accrues at a rate of interest equal to the Prime Rate for each Component.
“Prime Rate Spread” shall mean, with respect to any Component of the Loan, as the same may be reallocated pursuant to, and in accordance with, Section 11.1(b) hereof, in connection with any conversion of the Loan from (a) a LIBOR Loan to a Prime Rate Loan, the greater of (i) the difference (expressed as the number of basis points) obtained by subtracting (A) the Prime Index Rate as of the Determination Date for which LIBOR was last available from (B) LIBOR, determined as of such Determination Date, plus the LIBOR Spread applicable to such Component, and (ii) zero (0), or (b) an Alternate Rate Loan to a Prime Rate Loan, the greater of (i) the difference (expressed as the number of basis points) obtained by subtracting (A) the Prime Index Rate as of the Determination Date for which the Alternate Index Rate was last available from (B) the Alternate Index Rate, determined as of such Determination Date, plus the Alternate Rate Spread for such Component, and (ii) zero (0). The Prime Rate Spread shall be increased by 25 basis points (0.25%) from and after the first day of the third Extension Period in
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accordance with Section 2.9(g), without duplication of any increase with respect to the LIBOR Spread or the Alternate Rate Spread in accordance with Section 2.9(g).
“Prior Hurricane Damage” shall mean any damage at any Puerto Rico Portfolio Property that occurred as a result of any hurricane impacting Puerto Rico but has not been subject to PR Restoration prior to the Closing Date. Any damage, repair or other physical or operational conditions at any Puerto Rico Portfolio Property that is, or may be, in violation of any Permits, Legal Requirements, Leases or Permitted Encumbrances that exists as of the date of this Agreement and has not been subject to PR Restoration are deemed to be Prior Hurricane Damage.
“Prior Hurricane Damage (Plaza del Sol)” shall mean any damage at the Plaza del Sol Property that occurred as a result of any hurricane impacting Puerto Rico but has not been subject to PR Restoration prior to the Closing Date. Any damage, repair or other physical or operational conditions at the Plaza del Sol Property is, or may be, in violation of any Permits, Legal Requirements, Leases or Permitted Encumbrances that exists as of the date of this Agreement and has not been subject to PR Restoration are deemed to be Prior Hurricane Damage (Plaza del Sol).
“Prohibited Entity” means any Person which (i) is a statutory trust or similar Person and/or (ii) is a Crowdfunded Person.
“Prohibited Transfer” shall have the meaning set forth in Section 6.2 hereof.
“Projections” shall have the meaning set forth in Section 11.8(b)(ii) hereof.
“Property” and “Properties” shall mean, individually and/or collectively (as the context requires), each Individual Property which is subject to the terms hereof and of the other Loan Documents.
“Property Document” shall mean, individually or collectively (as the context may require), any reciprocal easement agreement affecting any Individual Property (or any portion thereof) more particularly described on Schedule 1.1(l) hereto (if any), and any amendment, restatement, replacement, supplement or other modification thereof.
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“Property Document Event” shall mean any event which would (A) (i) result in the termination of a Property Document, (ii) grant or trigger the exercise of a right of first refusal, first offer or any other similar right in favor of any third-party granting such third party rights to purchase an Individual Property with respect to a Property Document or (iii) cause any material termination fees as a result of a termination, in whole or in part, of a Property Document to be due by Borrower, and, in the case of clauses (i) through (iii) above, which would have a Material Adverse Effect or (B) result in a Material Adverse Effect as a direct result of a default by Borrower under any Property Document beyond any applicable notice and cure period thereunder; provided, however, any of the foregoing shall not be deemed a Property Document Event to the extent Lender’s prior written consent is obtained with respect to the same.
“Provided Information” shall mean any and all financial and other information (including any updates thereto) provided at any time by, or on behalf of any Borrower Party in connection with the Loan, the Properties and/or such Borrower Party.
“Prudent Lender Standard” shall, with respect to any matter, be deemed to have been met if the matter in question (i) prior to a Securitization, is reasonably acceptable to Lender and (ii) after a Securitization, (A) if permitted by REMIC Requirements applicable to such matter, would be reasonably acceptable to Lender or (B) if the Lender discretion in the foregoing subsection (A) is not permitted under such applicable REMIC Requirements, would be acceptable to a prudent lender of securitized commercial mortgage loans.
“Puerto Rico Borrower” shall have the meaning set forth in the introductory paragraph hereto.
“Puerto Rico Portfolio” shall have the meaning set forth in Section 2.14 hereof.
“Puerto Rico Portfolio Property” shall mean each Individual Puerto Rico Property included in the Puerto Rico Portfolio.
“Puerto Rico Taxes” shall mean an amount equal to Sponsor’s good faith estimate of any and all Taxes that will be payable to the Commonwealth of Puerto Rico by Borrower, Sponsor, any Taxable REIT Subsidiary, or any other direct or indirect subsidiary of Sponsor. Sponsor’s good faith estimate of any such Taxes shall be verified by Sponsor’s accountant (which shall be an independent accountant reasonably acceptable to Lender) and will be conclusive absent manifest error.
“Qualified Insurer” shall have the meaning set forth in Section 7.1 hereof.
“Qualified Management Agreement” shall mean a management agreement or sub-management agreement with a Qualified Manager with respect to the applicable Individual Property which is reasonably approved by Lender in writing (which such reasonable approval may be conditioned upon Lender’s receipt of a Rating Agency Confirmation with respect to such management agreement or sub-management agreement, as applicable).
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“Qualified Manager” shall mean (i) Sponsor, (ii) DDR Property Management LLC, DDR PR Ventures II LLC and DDR Asset Management LLC, in each case, so long as the same is not subject to a Bankruptcy Action and no other material adverse change (economic or otherwise) shall have occurred to same, as determined by Lender in its reasonable discretion, prior to same taking over the management or sub-management responsibilities of the Property, (iii) an Affiliate of DDR Property Management LLC, DDR PR Ventures II LLC or DDR Asset Management LLC which is wholly owned (directly or indirectly) and Controlled by Site Centers, so long as the same is not subject to a Bankruptcy Action and no other material adverse change (economic or otherwise) shall have occurred to same, as determined by Lender in its reasonable discretion, prior to same taking over the management or sub-management responsibilities of the Property, (iv) an Affiliate of Sponsor which is wholly owned (directly or indirectly) and Controlled by Sponsor, so long as the same is not subject to a Bankruptcy Action and no other material adverse change (economic or otherwise) shall have occurred to same, as determined by Lender in its reasonable discretion, prior to same taking over the management or sub-management responsibilities of the Property, and (v) a Person approved by Lender in writing (which such approval may be conditioned upon Lender’s receipt of a Rating Agency Confirmation with respect to such Person).
“Rate Cap Notice” shall have the meaning set forth in Section 2.8(g) hereof.
“Rating Agencies” shall mean each of S&P, Moody’s, Fitch, KBRA and Realpoint and any other nationally-recognized statistical rating agency designated by Lender (and any successor to any of the foregoing) in connection with and/or in anticipation of any Secondary Market Transaction.
“Rating Agency Condition” shall be deemed to exist if (i) any Rating Agency fails to respond to any request for a Rating Agency Confirmation with respect to any applicable matter or otherwise elects (orally or in writing) not to consider any applicable matter or (ii) Lender (or its Servicer) is not required to and/or elects not to obtain (or cause to be obtained) a Rating Agency Confirmation with respect to any applicable matter, in each case, pursuant to and in compliance with any trust and servicing agreement, pooling and servicing agreement(s) or similar agreement(s), in each case, relating to the servicing and/or administration of the Loan.
“Rating Agency Confirmation” shall mean (i) prior to a Securitization or if the Rating Agency Condition exists, that Lender has approved the matter in question in writing based upon Lender’s good faith determination of applicable Rating Agency standards and criteria and (ii) from and after a Securitization (to the extent the Rating Agency Condition does not exist), a written affirmation from each of the Rating Agencies (obtained at Borrower’s sole cost and expense) that the credit rating of the Securities by such Rating Agency immediately prior to the occurrence of the event with respect to which such Rating Agency Confirmation is sought will not be qualified, downgraded or withdrawn as a result of the occurrence of such event.
“Realpoint” shall mean Morningstar Credit Ratings, LLC.
“Recycled SPE Borrower/SPE Component Entity” shall mean those Borrowers and SPE Component Entities identified on Schedule 5.1 hereto.
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“Registrar” shall have the meaning set forth in Section 11.7 hereof.
“Registration Statement” shall have the meaning set forth in Section 11.2 hereof.
“Regulation AB” shall mean Regulation AB under the Securities Act and the Exchange Act, as such Regulation may be amended from time to time.
“Reimbursement Contribution” shall have the meaning set forth in Section 17.19 hereof.
“REIT” shall mean a Person that has elected to qualify as a real estate investment trust for federal income tax purposes.
“REIT Borrowers” shall mean (i) those Continental Borrowers that are wholly owned by RVT MS Mezz Borrower 1 LLC, RVT MS Mezz Borrower 2 LLC, RVT MS Holding Corporation Inc., RVT Mezz Borrower 1 LLC and RVT Mezz Borrower 2 LLC and (ii) those Puerto Rico Borrowers that are wholly owned by DDR PR Ventures III LLC, RVT PR Mezz Borrower 3 LLC, RVT PR Mezz Borrower 2 LLC and RVT PR Mezz Borrower 1 LLC. As of the Closing Date, the REIT Borrowers are listed on Schedule 6.3(iii) hereto.
“Related Loan” shall mean a loan to an Affiliate of Borrower or secured by a Related Property, that is included in a Securitization with the Loan (or any portion thereof or interest therein).
“Related Property” shall mean a parcel of real property, together with improvements thereon and personal property related thereto, that is “related” within the meaning of the definition of Significant Obligor, to the Property.
“Release Amount” shall have the meaning set forth in Section 2.10 hereof.
“Release Price” shall mean (A) with respect to the Plaza del Sol Property and each Individual Continental Property, as applicable, (i) if the Debt Yield (after giving pro forma effect to the Minimum Release Price actually paid in connection with such release) is equal to or less than 14.0%, the greater of (a) 100% of Net Sales Proceeds for the Plaza del Sol Property or the Individual Continental Property, as applicable, that is the subject of the release and (b) 110% of the Allocated Loan Amount for the Plaza del Sol Property (and the Collateral related thereto) or the Individual Continental Property (and the Collateral related thereto), as applicable, that is the subject of the release, (ii) if the Debt Yield (after giving pro forma effect to the Minimum Release Price actually paid in connection with such release) is greater than 14.0%, the greater of (a) 90% of Net Sales Proceeds for the Plaza del Sol Property or the Individual Continental Property, as applicable, that is the subject of the release and (b) 105% of the Allocated Loan Amount for the Plaza del Sol Property or the Individual Continental Property, as applicable, that is the subject of the release, provided, however, further that notwithstanding anything contained herein to the contrary, with respect to the release of the Plaza del Sol Property or an Individual Continental Property, as applicable, if the applicable Net Sales Proceeds Amount is greater than the applicable Minimum Release Price for the Plaza del Sol Property or such Individual Continental Property, as applicable, the amount by which such applicable Net Sales Proceeds
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Amount exceeds such applicable Minimum Release Price (such amount, the “Excess Release Amount”) may be applied by Borrower in whole or in part as a credit to be utilized against future releases of the Plaza del Sol Property (if not theretofore released) and/or one or more Individual Continental Properties, as applicable, and amounts owing to Lender by Borrower in connection therewith, thereby reducing the amount actually payable by Borrower in connection with such release by such Excess Release Amount; and (B) with respect to each Individual Puerto Rico Property (and the Collateral related thereto) other than the Plaza del Sol Property, and the Collateral related thereto, which is addressed in the foregoing clause (A), 100% of Net Sales Proceeds for the Individual Puerto Rico Property (or the related Collateral Equity Interests) that is the subject of the release. For the avoidance of doubt, if such Partial Release is with respect to the Plaza del Sol Property and/or an Individual Continental Property, Lender shall have received the applicable Minimum Release Price (after taking into account any Excess Release Amount).
“Released Property” shall have the meaning set forth in Section 2.10 hereof.
“Remaining Loan” shall have the meaning set forth in Section 11.9 hereof.
“Remaining Loan Documents” shall have the meaning set forth in Section 11.9 hereof.
“REMIC Opinion” shall mean, as to any matter, an opinion of counsel as to the compliance of such matter with applicable REMIC Requirements (which such opinion shall be, in form and substance and from a provider, in each case, reasonably acceptable to Lender and acceptable to the Rating Agencies).
“REMIC Payment” shall have the meaning set forth in Section 7.3 hereof.
“REMIC Requirements” shall mean any applicable legal requirements relating to any REMIC Trust (including, without limitation, those relating to the continued treatment of the Loan (or the applicable portion thereof and/or interest therein) as a “qualified mortgage” held by such REMIC Trust, the continued qualification of such REMIC Trust as such under the IRS Code, the non-imposition of any tax on such REMIC Trust under the IRS Code (including, without limitation, taxes on “prohibited transactions” and “contributions”) and any other constraints, rules and/or other regulations and/or requirements relating to the servicing, modification and/or other similar matters with respect to the Loan (or any portion thereof and/or interest therein) that may now or hereafter exist under applicable legal requirements (including, without limitation under the IRS Code)).
“REMIC Trust” shall mean any “real estate mortgage investment conduit” within the meaning of Section 860D of the IRS Code that holds any interest in all or any portion of the Loan.
“Renewal Deadline” shall have the meaning set forth in Section 4.27(e) hereof.
“Renewal Notice” shall have the meaning set forth in Section 4.27(e) hereof.
“Rent Loss Proceeds” shall have the meaning set forth in Section 7.1 hereof.
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“Rent Roll” shall have the meaning set forth in Section 3.18 hereof.
“Rents” shall mean (a) with respect to the Plaza del Sol Property and each Individual Continental Property, “Rent” as defined in the applicable Security Instrument and (b) with respect to each Individual Puerto Rico Property (other than the Plaza del Sol Property which is addressed in the foregoing clause (a)), all rents, additional rents, rent equivalents, moneys payable as damages or in lieu of rent or rent equivalents, royalties (including, without limitation, all oil and gas or other mineral royalties and bonuses), income, receivables, receipts, revenues, deposits (including, without limitation, security, utility and other deposits), accounts, cash, issues, profits, charges for services rendered, and other consideration of whatever form or nature received by or paid to or for the account of or benefit of Borrower or its agents or employees from any and all sources arising from or attributable to the Individual Puerto Rico Property (other than the Plaza del Sol Property which is addressed in the foregoing clause (a)), including, all receivables, customer obligations, installment payment obligations and other obligations now existing or hereafter arising or created out of the sale, lease, sublease, license, concession or other grant of the right of the use and occupancy of property or rendering of services by Borrower or Manager and proceeds, if any, from business interruption or other loss of income insurance (excluding, however, the BI Proceeds) whether paid or accruing before or after any Bankruptcy Action.
“Replacement Interest Rate Cap Agreement” shall have the meaning set forth in Section 2.8(c) hereof.
“Reporting Failure” shall have the meaning set forth in Section 4.12 hereof.
“Representative Borrower” shall have the meaning set forth in Section 14.1 hereof.
“Required Financial Item” shall have the meaning set forth in Section 4.12 hereof.
“Required Rating” means (i) a rating of not less than “A‑1” (or its equivalent) from each of the Rating Agencies if the term of such Letter of Credit is no longer than three (3) months or if the term of such Letter of Credit is in excess of three (3) months, a rating of not less than “AA-” (or its equivalent) from each of the Rating Agencies or (ii) such other rating with respect to which Lender shall have received a Rating Agency Confirmation.
“Required REIT Distribution” shall mean an amount equal to the minimum amount of the dividend required to be distributed in cash (as opposed to equity) with respect to any taxable year of Sponsor in order for Sponsor to qualify as a REIT and to avoid any U.S. federal income Taxes imposed under IRS Code Sections 857(b)(1) and 857(b)(3). Sponsor shall in good faith estimate the amount of the Required REIT Distribution for each taxable year based on 102.5% of Sponsor’s then estimated taxable income, inclusive of net capital gains, for such taxable year, and such estimate shall be verified by Sponsor’s accountant (which shall be an independent accountant reasonably acceptable to Lender) and will be conclusive absent manifest error.
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“Required REIT Distributions and Tax Account” shall have the meaning set forth in Section 8.9 hereof.
“Required REIT Distributions and Tax Funds” shall have the meaning set forth in Section 8.9 hereof.
“Reserve Accounts” shall mean the Tax Account, the Insurance Account, the Capital Expenditures Reserve Account, the Leasing Reserve Account, the Excess Cash Flow Account, the Operating Expense Account, the Unfunded Obligations Reserve Account, the Ground Lease Reserve Account, the Required REIT Distributions and Tax Account, BI Proceeds Reserve Account, Deferred Management Fee Reserve Account, the Immediate Repair Account and any other escrow account established by this Agreement or the other Loan Documents (but specifically excluding the Cash Management Account, the Restricted Account, the Casualty Proceeds Restricted Account and the Debt Service Account).
“Reserve Funds” shall mean the Tax and Insurance Funds, the Capital Expenditures Reserve Funds, the Leasing Reserve Funds, the Excess Cash Flow Funds, the Operating Expense Funds, the Unfunded Obligations Reserve Funds, the Ground Lease Reserve Funds, BI Proceeds Reserve Funds, Deferred Management Fee Reserve Funds, the Immediate Repair Funds and any other escrow funds established by this Agreement or the other Loan Documents.
“Responsible Officer” means with respect to a Person, the chairman of the board, president, chief executive officer, chief accounting officer, chief operating officer, chief financial officer, treasurer, secretary or vice president of such Person or such other similar officer of such Person reasonably acceptable to Lender.
“Restoration” shall mean, following the occurrence of a Casualty or a Condemnation which is of a type necessitating the repair of the Property (or any portion thereof), the completion of the repair and restoration of the Property (or applicable portion thereof) as nearly as possible to the condition the Property (or applicable portion thereof) was in immediately prior to such Casualty or Condemnation, with such alterations as may be reasonably approved by Lender.
“Restoration Abated Revenue” shall have the meaning specified in Section 8.13 hereof.
“Restoration Abated Revenue Reserve Account” shall have the meaning specified in Section 8.13 hereof.
“Restoration Abated Revenue Reserve Funds” shall have the meaning specified in Section 8.13 hereof.
“Restoration Costs” shall have the meaning specified in Section 4.29 hereof.
“Restoration Retainage” shall have the meaning set forth in Section 7.4 hereof.
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“Restoration Threshold” shall mean (a) with respect to the Plaza del Sol Property and each Individual Continental Property, an amount equal to 5% of the outstanding principal amount of the Allocated Loan Amount attributable to such Individual Continental Property and (b) with respect to each Individual Puerto Rico Property other than the Plaza del Sol Property (which is addressed in the foregoing clause (a)), $5,000,000 for each such Individual Puerto Rico Property.
“Restricted Account” shall have the meaning set forth in Section 9.1 hereof.
“Restricted Account Agreement” shall mean (a) that certain Blocked Account Control Agreement (with Lockbox Services—REIT Properties) by and among RVT Newnan Crossing LLC, Lender and U.S. Bank, National Association, dated as of the date hereof, (b) that certain Blocked Account Control Agreement (with Lockbox Services—Non-REIT Properties) by and among RVT Noble Town Center LLC, Lender and U.S. Bank, National Association, dated as of the date hereof and (c) that certain Deposit Account Control Agreement (Hard Agreement—Restricted Account) by and among Puerto Rico Borrowers, Lender and PNC Bank, National Association, as each of the same may be amended, restated, replaced, supplemented or otherwise modified from time to time in accordance with the terms hereof.
“Restricted Collateral” shall have the meaning set forth in Section 10.2(a) hereof.
“Restricted Party” shall have the meaning set forth in Section 6.1 hereof.
“S&P” shall mean S&P Global Ratings, a Standard & Poor’s Financial Services LLC business.
“Sale or Pledge” shall have the meaning set forth in Section 6.1 hereof.
“Sanctions” shall have the meaning set forth in Section 3.30 hereof.
“Satisfactory Search Results” shall mean the results of Lender’s customary “know your customer”, credit history check, litigation, lien, bankruptcy, judgment and other similar searches with respect to the applicable transferee and its applicable affiliates, in each case, (i) revealing no matters which would have a Material Adverse Effect and (ii) yielding results which are otherwise acceptable to Lender in its reasonable discretion. Borrower shall pay all of Lender’s reasonable out-of-pocket costs, fees and expenses in connection with the foregoing and, notwithstanding the forgoing, no such search results shall constitute “Satisfactory Search Results” until such reasonable out-of-pocket costs, fees and expenses are paid in full.
“Seabrook Condominium” shall mean that certain condominium regime established at the Seabrook Property pursuant to the Seabrook Condominium Documents.
“Seabrook Condominium Documents” shall mean that certain Declaration of Seabrook Town Center Condominium, entered into by DDR Seabrook LLC, a Delaware limited liability company, dated as of December 17, 2012, and recorded on December 20, 2012, at Book 5391, Page 0228 of the Rockingham County Registry of Deeds, together with all other documents or instruments evidencing or otherwise relating to the Seabrook Condominium, as the
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same may be amended, restated or otherwise modified from time to time in accordance with this Agreement.
“Seabrook Property” shall mean that certain Individual Property commonly known as Seabrook Commons.
“Secondary Market Transaction” shall have the meaning set forth in Section 11.1 hereof.
“Securities” shall have the meaning set forth in Section 11.1 hereof.
“Securities Act” shall mean the Securities Act of 1933, as amended.
“Securitization” shall have the meaning set forth in Section 11.1 hereof.
“Security Deposits” shall mean any advance deposits or any other deposits collected with respect to the Property, whether in the form of cash, letter(s) of credit or other cash equivalents (including, without limitation, such deposits made in connection with any Lease).
“Security Instrument” and “Security Instruments” shall mean, individually and/or collectively (as the context requires), each first priority Mortgage and Security Agreement, Deed of Trust and Security Agreement, Deed to Secure Debt and Security Agreement and/or Mortgage Note Pledge and Security Agreement, dated the date hereof, executed and delivered by Borrower as security for the Loan and encumbering the Property (or any portion thereof), as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.
“Security Instrument Taxes” shall have the meaning set forth in Section 15.2 hereof.
“Servicer” shall have the meaning set forth in Section 11.4 hereof.
“Severed Loan Documents” shall have the meaning set forth in Article 10 hereof.
“Significant Obligor” shall have the meaning set forth in Item 1101(k) of Regulation AB under the Securities Act.
“Single Purpose Entity” shall mean an entity satisfying the applicable requirements of Section 5.1 hereof.
“Site Centers” shall mean SITE Centers Corp.
“Site Centers Shared Services Fee Cap” shall mean an amount equal to one-half percent (0.5%) per annum of Gross Asset Value (as defined on Exhibit F attached hereto).
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“Site Centers Shared Services Fees” shall mean all fees and reimbursement payments payable to Site Centers or an Affiliate by Sponsor and/or the Borrowers in connection with its management of the Sponsor.
“SPE Component Entity” shall have the meaning set forth in Section 5.1 hereof.
“Special Member” is defined in Section 5.1 hereof.
“Sponsor” shall mean Retail Value Inc., an Ohio corporation.
“Sponsor Control Condition” shall mean a condition which shall be deemed satisfied to the extent that after giving effect to any transfer, (a) Sponsor continues to directly or indirectly (x) own at least 100% of all of the direct and/or indirect equity ownership interests in Borrower, Pledgor, Additional Obligor, each Mezzanine Borrower and any SPE Component Entity and (y) has the right to 100% of the distributions from Borrower, Pledgor, Additional Obligor, each Mezzanine Borrower and any SPE Component Entity and (b) Sponsor continues to Control Borrower, Pledgor, Additional Obligor, each Mezzanine Borrower and any SPE Component Entity.
“Sponsor Corporate Expenses” shall mean the normal and customary expenditures and costs incurred by Sponsor to maintain its status as a publicly-traded corporation, which expenditures and costs shall include, but not be limited to, director fees and expenses, annual reporting/ proxy/ SEC costs, directors and officers insurance, transfer agent fees, legal fees, audit fees, tax fees, PCAOB and FASB fees, New York Stock Exchange fees and website and investor relations costs.
“State” shall mean the applicable state in which the applicable Individual Property is located.
“Stated Maturity Date” shall mean the Monthly Payment Date occurring in March, 2021.
“Strike Rate” shall mean (i) with respect to the period from the Closing Date through the Stated Maturity Date, four and one half percent (4.5%) and (ii) with respect to each Extension Period, a percentage rate equal to a percentage rate per annum which, when added to the LIBOR Spread (or the Prime Rate Spread or the Alternate Rate Spread, as applicable), would yield a Debt Service Coverage Ratio of 1.20:1.00 (calculated assuming that for all times, LIBOR (or the Prime Rate or the Alternate Rate, as applicable) is equal to the new Strike Rate (rather than the then current Strike Rate) for purposes of determining the Debt Service and LIBOR (as defined in each Mezzanine Loan Agreement) (or the Prime Rate or the Alternate Rate (as each is defined in each Mezzanine Loan Agreement), as applicable) is equal to the new Strike Rate (as defined in each Mezzanine Loan Agreement) (rather than the current Strike Rate (as defined in each Mezzanine Loan Agreement)) for purposes of determining the Mezzanine Debt Service).
“Sub-Manager” shall have the meaning set forth in Section 4.15 hereof.
“Substitute Interest Rate Cap Agreement” shall have the meaning set forth in Section 2.8(j) hereof.
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“Survey” shall mean, individually or collectively (as the context requires), each survey of each Individual Property certified and delivered to Lender in connection with the closing of the Loan.
“Syndication” shall have the meaning set forth in Section 11.8(a)(i) hereof.
“Tax Account” shall have the meaning set forth in Section 8.6 hereof.
“Tax and Insurance Adjustment” shall mean an adjustment to the calculation of Operating Expenses for imminent liabilities and/or other expense increases (including, without limitation, imminent increases to Taxes and Insurance Premiums).
“Tax and Insurance Funds” shall have the meaning set forth in Section 8.6 hereof.
“Tax Payment Date” shall mean, with respect to any applicable Taxes, the date occurring 30 days prior to the date the same are due and payable.
“Taxable REIT Subsidiary” shall mean any entity for which Sponsor and such entity have made an election under Section 856(l) of the Code.
“Taxes” shall mean all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.
“Tenant” shall mean any Person leasing, subleasing or otherwise occupying any portion of the Property under a Lease or other occupancy agreement.
“Tenant Direction Notice” shall have the meaning set forth in Section 9.2 hereof.
“Test Date” shall mean the last day of each Fiscal Quarter.
“Title Insurance Policy” shall mean those certain ALTA mortgagee title insurance policies issued with respect to each Individual Property and insuring the lien of the Security Instruments.
“Trigger Period” shall mean a period (A) commencing upon (i) the occurrence and continuance of an Event of Default, (ii) the occurrence and continuance of a Mezzanine Loan Default, (iii) the Debt Yield falling below 10.0% (a “Debt Yield Trigger”) (for the avoidance of doubt, the parties agree that for purposes of determining whether a Debt Yield Trigger has occurred on the related Test Date, Lender shall (x) refer to the financial statements most recently delivered for the reimbursement and expense component of Net Cash Flow and (y) refer to the most recently delivered rent roll for the income component of Net Cash Flow, and in each case, Lender will deduct any expenses and income included in such financial statements and/or rent roll, as applicable, related to any Property that has been released in accordance with this Agreement as of such Test Date) or (iv) Borrower’s failure to deliver any Required Financial Item within ten (10) Business Days after written notice from Lender; and (B) expiring upon (w)
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with regard to any Trigger Period commenced in connection with clause (i) above, the cure (if applicable) of such Event of Default, (x) with regard to any Trigger Period commenced in connection with clause (ii) above, the applicable Mezzanine Lender shall have accepted a cure by the applicable Mezzanine Borrowers of such Mezzanine Loan Default or otherwise waived such Mezzanine Loan Default and shall not have otherwise accelerated such Mezzanine Loan, moved for a receiver or commenced foreclosure proceedings, (y) with regard to any Trigger Period commenced in connection with clause (iii) above, (I) the date that the Debt Yield (which, for the avoidance of doubt, the first Debt Yield Trigger test shall occur on March 31, 2019 and quarterly thereafter, tested on the Test Date) is equal to or greater than the Debt Yield Trigger or (II) receipt by Lender of a Debt Yield Trigger Cure Payment. Notwithstanding the foregoing, a Trigger Period shall not be deemed to expire in the event that a Trigger Period then exists for any other reason and (z) with regard to any Trigger Period commenced in connection with clause (iv) above, receipt by Lender of such Required Financial Item meeting the requirements of Section 4.12 and otherwise showing that no other Trigger Period shall have occurred and be continuing and payment to Lender of the applicable fee for such Reporting Failure described in Section 4.12(e) hereof.
“TRIPRA” shall have the meaning set forth in Section 7.1(b) hereof.
“TRS Taxes” shall mean an amount equal to (i) the Sponsor’s good faith estimate of each Taxable REIT Subsidiary’s taxable income for a taxable year multiplied by (ii) the amount determined by adding the federal corporate tax rate plus the blended state corporate tax rate applicable for GAAP purposes (which such amount is estimated to be 28% as of the Closing Date). For the avoidance of doubt, TRS Taxes will be the total of the amounts determined separately for each Taxable REIT Subsidiary. Sponsor’s good faith estimate of each Taxable REIT Subsidiary’s taxable income shall be verified by Sponsor’s accountant (which shall be an independent accountant reasonably acceptable to Lender) and will be conclusive absent manifest error.
“True Up Payment” shall mean a payment into the applicable Reserve Account of a sum which, together with any amounts then on deposit in the applicable Reserve Account, will be sufficient to discharge the obligations and liabilities for which such Reserve Account was established as and when such obligations and liabilities are required to be paid. The amount of the True Up Payment shall be determined by Lender in its reasonable discretion in accordance with the Loan Documents and shall be final and binding absent manifest error.
“Tucson Spectrum II Property” shall have the meaning set forth in Section 2.10(g)(x) hereof.
“U.S. Obligations” shall mean direct full faith and credit obligations of the United States of America that are not subject to prepayment, call or early redemption.
“U.S. Person” shall mean a Person that is a “United States person” as defined in Section 7701(a)(30) of the IRS Code.
“U.S. Tax Compliance Certificate” shall have the meaning set forth in Section 2.5(b) hereof.
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“UCC” or “Uniform Commercial Code” shall mean the Uniform Commercial Code as in effect in the State of New York.
“UCC Title Insurance Policy” shall mean, with respect to the Collateral, a UCC title insurance policy in the form reasonably acceptable to Lender issued with respect to the Collateral and insuring the lien of the Pledge Agreement encumbering such Collateral.
“Unaffected Property” shall have the meaning set forth in Section 11.9 hereof.
“Uncrossed Loan” shall have the meaning set forth in Section 11.9 hereof.
“Uncrossed Loan Documents” shall have the meaning set forth in Section 11.9 hereof.
“Uncrossing Event” shall have the meaning set forth in Section 11.9 hereof.
“Underwriter Group” shall have the meaning set forth in Section 11.2 hereof.
“Unencumbered Borrower” shall have the meaning set forth in Section 2.10 hereof.
“Unfunded Obligations” shall have the meaning set forth in Section 8.8 hereof.
“Unfunded Obligations Reserve Account” shall have the meaning set forth in Section 8.8 hereof.
“Unfunded Obligations Reserve Funds” shall have the meaning set forth in Section 8.8 hereof.
“Units” shall mean “Units”, “Tracts”, “Lots”, “Master Units” or words of similar import as defined in the Condominium Documents that relate to a physical portion of the property that is designated for separate ownership and occupancy pursuant to, and in accordance with, the Condominium Documents.
“Updated Information” shall have the meaning set forth in Section 11.1 hereof.
“Work Charge” shall have the meaning set forth in Section 4.16 hereof.
“Write-Down and Conversion Powers” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.
“Zoning Report” shall have the meaning set forth in Section 3.11 hereof.
Section 1.2.Principles of Construction.
All references to sections and schedules are to sections and schedules in or to this Agreement unless otherwise specified. All uses of the word “including” shall mean “including,
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without limitation” unless the context shall indicate otherwise. Unless otherwise specified, the words “hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. Unless otherwise specified, all meanings attributed to defined terms herein shall be equally applicable to both the singular and plural forms of the terms so defined. References herein to “the Property or any portion thereof” and words of similar import shall be deemed to refer, as applicable, to any portion of the Property taken as a whole (including any Individual Property) and any portion of any Individual Property.
ARTICLE 2
GENERAL TERMS
Section 2.1.Loan Commitment; Disbursement to Borrower. Except as expressly and specifically set forth herein, Lender has no obligation or other commitment to loan any funds to Borrower or otherwise make disbursements to Borrower. Borrower hereby waives any right Borrower may have to make any claim to the contrary.
Section 2.2.The Loan. Subject to and upon the terms and conditions set forth herein, Lender hereby agrees to make and Borrower hereby agrees to accept the Loan on the Closing Date.
Section 2.3.Disbursement to Borrower. Borrower may request and receive only one borrowing hereunder in respect of the Loan and any amount borrowed and repaid hereunder in respect of the Loan may not be re-borrowed.
Section 2.4.The Note and the Other Loan Documents. The Loan shall be evidenced by the Note and this Agreement and secured by this Agreement and the other Loan Documents.
Section 2.5.Interest Rate.
(a)Generally. Interest on the outstanding principal balance of each Component of the Loan shall accrue from the Closing Date at the Interest Rate until repaid in accordance with the applicable terms and conditions hereof.
(b)Determination of Interest Rate.
(i)The Interest Rate with respect to each Component of the Loan shall be: (A) the LIBOR Rate with respect to the applicable Interest Accrual Period if the Loan is a LIBOR Loan, (B) the Alternate Rate with respect to the applicable Interest Accrual Period if the Loan is an Alternate Rate Loan, or (C) the Prime Rate with respect to the applicable Interest Accrual Period if the Loan is a Prime Rate Loan. Notwithstanding any provision of this Agreement to the contrary, in no event shall Borrower have the right to convert (w) a LIBOR Loan to a Prime Rate Loan or an Alternate Rate Loan or (x) a Prime Rate Loan to a LIBOR Loan or an Alternate Rate Loan or (y) an Alternate Rate Loan to a LIBOR Loan or a Prime Rate Loan.
(ii)Subject to the terms and conditions hereof, the Loan shall be a LIBOR Loan and Borrower shall pay interest on the outstanding principal amount of each
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Component of the Loan at the LIBOR Rate for the applicable Interest Accrual Period. Any change in the rate of interest hereunder due to a change in the Interest Rate shall become effective as of the opening of business on the first day on which such change in the Interest Rate shall become effective. Each determination by Lender of the Interest Rate shall be conclusive and binding upon Borrower and Lender for all purposes, absent manifest error.
(iii)Conversion of the Loan.
(A)If at any time the Loan is outstanding as a LIBOR Loan and Lender shall have determined (which determination shall be conclusive and binding upon Borrower absent manifest error) that LIBOR cannot be determined and LIBOR has been succeeded by an Alternate Index (an “Alternate Index Determination”), then the Loan shall be converted from a LIBOR Loan to an Alternate Rate Loan; provided, that, following a Securitization, such conversion shall be subject to Lender’s receipt of (1) an opinion of nationally recognized REMIC counsel as to the compliance of such conversion with applicable REMIC requirements as determined under the IRS Code and the regulations, revenue rulings, revenue procedures and other administrative, legislative and judicial guidance relating to the tax treatment of REMIC Trusts (which such opinion shall be obtained at Lender’s sole cost and expense and shall be in form and substance and from a provider, in each case, reasonably acceptable to Lender) and (2) a Rating Agency Confirmation in connection with such conversion (clauses (1) and (2), each an “Alternate Rate Condition”). Lender shall provide Borrower with written notice following the making of an Alternate Index Determination and, if a Securitization has occurred, shall promptly request the Rating Agency Confirmation described in clause (2) immediately above in the manner prescribed by the servicing agreement with respect to the Loan. Lender shall provide notice of (x) prior to a Securitization, the Alternate Index Determination and (y) following a Securitization and upon satisfaction of the Alternate Rate Conditions, that the Alternate Rate Conditions have been satisfied, in each case by giving notice of such determination in writing to Borrower at least five (5) Business Days prior to the next succeeding Determination Date. If such notice is given, the Loan shall be converted, as of the first day of the next succeeding Interest Accrual Period, to an Alternate Rate Loan in accordance with the terms and provisions hereof.
(B)In the event that Lender shall have determined (which determination shall be conclusive and binding upon Borrower absent manifest error) that by reason of circumstances affecting the interbank Eurodollar market or otherwise, adequate and reasonable means do not exist for ascertaining LIBOR as provided in the definition thereof and the Loan has not been converted to an Alternate Rate Loan as provided in clause (A) above, then Lender shall, if such determination shall have also been made with respect to other similarly situated loans, forthwith give notice by telephone of such determination, confirmed in writing, to Borrower at least one (1) Business Day prior to the next succeeding Determination Date. If such notice is given, the LIBOR Loan shall be converted, as of the first day of the next succeeding Interest Accrual Period, to a Prime Rate Loan.
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(C)If, pursuant to the terms of clause (A) above, the Loan has been converted to an Alternate Rate Loan but thereafter Lender shall determine (which determination shall be conclusive and binding upon Borrower absent manifest error) that the Alternate Index cannot be ascertained as provided in the definition thereof, then Lender shall, if such determination shall have also been made with respect to other similarly situated loans, forthwith give notice by telephone of such determination, confirmed in writing, to Borrower at least one (1) Business Day prior to the next succeeding Determination Date. If such notice is given, the Alternate Rate Loan shall be converted, as of the first day of the next succeeding Interest Accrual Period, to a Prime Rate Loan.
(D)If, pursuant to the terms of clauses (B) or (C) above, the Loan has been converted to a Prime Rate Loan, but thereafter Lender shall determine (which determination shall be conclusive and binding upon Borrower absent manifest error) that LIBOR or the Alternate Index, as applicable, can again be ascertained as provided in the respective definition thereof, Lender shall give notice by telephone of such determination, confirmed in writing, to Borrower at least one (1) Business Day prior to the next succeeding Determination Date. If such notice is given, the Loan shall be converted, as of the first day of the next succeeding Interest Accrual Period, to a LIBOR Loan or an Alternate Rate Loan, as applicable.
(E)If, pursuant to the terms of clause (B) above, the Loan has been converted to a Prime Rate Loan but thereafter Lender shall determine (which determination shall be conclusive and binding upon Borrower absent manifest error) that LIBOR has been succeeded by an Alternate Index pursuant to, and subject to the satisfaction of, the terms and conditions of clause (A) above, Lender shall give notice by telephone of such determination, confirmed in writing, to Borrower at least one (1) Business Day prior to the last day of the related Interest Accrual Period. If such notice is given, the Prime Rate Loan shall be converted, as of the first day of the next succeeding Interest Accrual Period, to an Alternate Rate Loan.
(iv)Intentionally omitted.
(v)If any requirement of law or any change therein or in the interpretation or application thereof, shall hereafter make it unlawful for Lender to make or maintain a LIBOR Loan as contemplated hereunder (A) the obligation of Lender hereunder to make a LIBOR Loan or to convert a Prime Rate Loan to a LIBOR Loan shall be canceled forthwith and (B) any outstanding LIBOR Loan shall be converted automatically to a Prime Rate Loan on the last day of the then current Interest Accrual Period or within such earlier period as required by law. Borrower hereby agrees to promptly pay to Lender, upon demand, any additional amounts necessary to compensate Lender for any reasonable costs incurred by Lender in making any conversion in accordance with this Agreement, including, without limitation, any interest or fees payable by Lender to lenders of funds obtained by it in order to make or maintain the LIBOR Loan hereunder. Lender’s notice of such costs, as certified to Borrower, shall be conclusive absent manifest error.
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(vi)In the event that any change in any requirement of law or in the interpretation or application thereof, or compliance by Lender with any request or directive (whether or not having the force of law) hereafter issued from any central bank or other Governmental Authority:
(A)shall hereafter impose, modify or hold applicable any reserve, capital adequacy, tax (other than any (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes), special deposit, compulsory loan or similar requirement against assets held by, or deposits or other liabilities in or for the account of, advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of Lender which is not otherwise included in the determination of LIBOR (or the Alternate Index, as applicable) hereunder;
(B)shall hereafter have the effect of reducing the rate of return on Lender’s capital as a consequence of its obligations hereunder to a level below that which Lender could have achieved but for such adoption, change or compliance (taking into consideration Lender’s policies with respect to capital adequacy) by any amount deemed by Lender to be material; or
(C)shall hereafter impose on Lender any other condition (other than any tax) and the result of any of the foregoing is to increase the cost to Lender of making, renewing or maintaining loans or extensions of credit or to reduce any amount receivable hereunder;
then, in any such case, Borrower shall promptly pay Lender, upon demand, any additional amounts necessary to compensate Lender for such additional cost or reduced amount receivable as determined by Lender. If Lender becomes entitled to claim any additional amounts pursuant to this subsection, Lender shall provide Borrower with not less than thirty (30) days’ notice specifying in reasonable detail the event by reason of which it has become so entitled and the additional amount required to fully compensate Lender for such additional cost or reduced amount. A certificate as to any additional costs or amounts payable pursuant to the foregoing sentence submitted by Lender to Borrower shall be conclusive in the absence of manifest error. This provision shall survive payment of the Note and the satisfaction of all other obligations of Borrower under this Agreement and the Loan Documents.
(vii)Borrower agrees to indemnify Lender and to hold Lender harmless from any out-of-pocket loss or expense which Lender sustains or incurs as a consequence of (A) any default by Borrower in payment of the principal of or interest on a LIBOR Loan, including, without limitation, any such loss or expense arising from interest or fees payable by Lender to lenders of funds obtained by it in order to maintain a LIBOR Loan (or Prime Rate Loan or Alternate Rate Loan, as applicable) hereunder, (B) any prepayment (whether voluntary or mandatory) of the LIBOR Loan (or Prime Rate Loan or Alternate Rate Loan, as applicable) on a day that is not a Monthly Payment Date, including, without limitation, such loss or expense arising from interest or fees payable by Lender to lenders of funds obtained by it in order to maintain the LIBOR Loan (or Prime Rate Loan or Alternate Rate Loan, as applicable) hereunder and (C) the conversion (for any reason whatsoever, whether voluntary or involuntary) of the Interest Rate from (x) the LIBOR Rate to the Prime Rate, (y) the LIBOR Rate or the Prime Rate to the Alternate Rate or (z) the Prime Rate to a LIBOR Loan or Alternate Rate Loan, as
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applicable, in each case, with respect to any portion of the outstanding principal amount of the Loan then bearing interest at the LIBOR Rate, the Prime Rate or the Alternate Rate, as applicable, on a date other than the last day of an Interest Accrual Period, including, without limitation, such loss or expenses arising from interest or fees payable by Lender to lenders of funds obtained by it in order to maintain a LIBOR Loan (or Prime Rate Loan or Alternate Rate Loan) hereunder (the amounts referred to in clauses (A), (B) and (C) are herein referred to collectively as the “Breakage Costs”); provided, however, Borrower shall not indemnify Lender from any loss or expense arising from Lender’s willful misconduct or gross negligence. This provision shall survive payment of the Note in full and the satisfaction of all other obligations of Borrower under this Agreement and the other Loan Documents.
(viii)Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any of the following Persons, Borrower, each Borrower Party and Lender acknowledge that any liability of any EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the Write-Down and Conversion Powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by (i) the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and (ii) the effects of any Bail-In Action on any such liability, including, if applicable (A) a reduction in full or in part or cancellation of any such liability; (B) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; and/or (C) the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of any EEA Resolution Authority.
(ix)Any and all payments by or on account of any obligation Borrower under this Agreement shall be made without deduction or withholding for any Taxes, except as required by applicable law. If any applicable law (as determined in the good faith discretion of Borrower) requires the deduction or withholding of any Tax from any such payment by a Borrower or other withholding agent, then Borrower or other withholding agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by Borrower shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section) the applicable Lender receives an amount equal to the sum it would have received had no such deduction or withholding been made.
(x)Borrower shall indemnify each Lender, within ten (10) Business Days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section) payable or paid by such Lender or required to be withheld or deducted from a payment to such Lender and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant
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Governmental Authority. A certificate as to the amount of such payment or liability delivered to Borrower by a Lender (with a copy to the Agent), or by the Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error, provided that the determination in such certificate is made on a reasonable basis and in good faith.
(xi)Each Lender shall severally indemnify Agent, within ten (10) Business days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that Borrower has not already indemnified Agent for such Indemnified Taxes and without limiting the obligation of Borrower to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 11.8(a)(ix) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by Agent in connection with this Agreement, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by Agent shall be conclusive absent manifest error. Each Lender hereby authorizes Agent to set off and apply any and all amounts at any time owing to such Lender under this Agreement or otherwise payable by Agent to the Lender from any other source against any amount due to the Agent under this subparagraph (xi).
(xii)As soon as practicable after any payment of Taxes by Borrower or other withholding agent to a Governmental Authority pursuant to this Section 2.5(b), Borrower or other withholding agent shall deliver to Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Agent.
(xiii)If Lender is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document, Lender shall deliver to Borrower and Agent, at the time or times reasonably requested by Borrower or Agent, such properly completed and executed documentation reasonably requested by Borrower or Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, Lender, if reasonably requested by Borrower or Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by Borrower or Agent as will enable Borrower or Agent to determine whether Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in paragraphs (b)(xiii)(A), (b)(xiii)(B) and (b)(xiii)(D) of this Section) shall not be required if in Lender’s reasonable judgment such completion, execution or submission would subject Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of Lender. Without limiting the generality of the foregoing:
(A)any Lender that is a U.S. Person shall deliver to Borrower and Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or Agent), executed copies of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding Tax;
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(B)if Lender is or becomes a Foreign Lender, Lender shall, to the extent it is legally entitled to do so, deliver to Borrower and Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which Lender becomes a party to this Agreement or becomes a Foreign Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or Agent), whichever of the following is applicable:
(1)in the case of a Foreign Lender claiming the benefits of an income Tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed copies of IRS Form W-8BEN or IRS Form W-8BEN-E (as applicable) establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such Tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN or IRS Form W-8BEN-E (as applicable) establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such Tax treaty;
(2)executed copies of IRS Form W-8ECI;
(3)in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the IRS Code, (x) a certificate substantially in the form of Exhibit D‑1 to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the IRS Code, a “10 percent shareholder” of Borrower within the meaning of Section 881(c)(3)(B) of the IRS Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the IRS Code (a “U.S. Tax Compliance Certificate”) and (y) executed copies of IRS Form W-8BEN or IRS Form W-8BEN-E (as applicable); or
(4)to the extent a Foreign Lender is not the beneficial owner, executed copies of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, IRS Form W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the form of Exhibit D‑2 or Exhibit D-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit D-4 on behalf of each such direct and indirect partner;
(C)any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to Borrower and Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or Agent), executed copies of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit Borrower or Agent to determine the withholding or deduction required to be made; and
(D)if a payment made to Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in
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Section 1471(b) or 1472(b) of the IRS Code, as applicable), Lender shall deliver to Borrower and Agent at the time or times prescribed by law and at such time or times reasonably requested by Borrower or Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the IRS Code) and such additional documentation reasonably requested by Borrower or Agent as may be necessary for Borrower or Agent to comply with their obligations under FATCA and to determine that Lender has complied with Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.
Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify Borrower and Agent in writing of its legal inability to do so.
(xiv)If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to paragraph (b)(ix) (including by the payment of additional amounts pursuant to paragraph (b)(ix)), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under paragraphs (b)(ix) of (b)(x) with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this paragraph (b)(xiv) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this paragraph (b)(xiv), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (b)(xiv) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such tax had never been paid. This paragraph (b)(xiv) shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.
(xv)Each party’s obligations under this Section 2.5(b)(vi)-(xiv) shall survive the resignation or replacement of the Agent or any assignment of rights by, or the replacement of, a Lender, and the repayment, satisfaction or discharge of all obligations under any Loan Document.
(c)Default Rate. In the event that, and for so long as, any Event of Default shall have occurred and be continuing, (i) the then outstanding principal balance of the Loan and shall accrue interest at the Default Rate, calculated from the date of such Event of Default, (ii) without limitation of any rights or remedies contained herein and/or in any other Loan Document, any interest accrued at the Default Rate in excess of the interest component of the Monthly Debt Service Payment Amount shall, to the extent not already paid and/or due and
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payable hereunder, be due and payable on each Monthly Payment Date and (iii) all references herein and/or in any other Loan Document to the “Interest Rate” shall be deemed to refer to the Default Rate.
(d)Interest Calculation. Interest on the outstanding principal balance of each Component of the Loan shall be calculated by multiplying (a) the actual number of days elapsed in the period for which the calculation is being made by (b) a daily rate based on a three hundred sixty (360) day year (that is, the Interest Rate or the Default Rate, as then applicable, expressed as an annual rate divided by 360) by (c) the outstanding principal balance. The accrual period for calculating interest due on each Monthly Payment Date shall be the Interest Accrual Period in which the related Monthly Payment Date occurs. Borrower understands and acknowledges that such interest accrual requirement results in more interest accruing on the Loan than if either a thirty (30) day month and a three hundred sixty (360) day year or the actual number of days and a three hundred sixty-five (365) day year were used to compute the accrual of interest on the Loan.
(e)Usury Savings. This Agreement and the other Loan Documents are subject to the express condition that at no time shall Borrower be required to pay interest on the principal balance of the Loan (including, to the extent applicable, any prepayment premium and/or penalty) at a rate which could subject Lender to either civil or criminal liability as a result of being in excess of the Maximum Legal Rate. If by the terms of this Agreement or the other Loan Documents, Borrower is at any time required or obligated to pay interest on the principal balance due hereunder (including, to the extent applicable, any prepayment premium and/or penalty) at a rate in excess of the Maximum Legal Rate, the Interest Rate or the Default Rate, as the case may be, and/or, to the extent applicable, any prepayment premium and/or penalty shall, in each case, be deemed to be immediately reduced to the Maximum Legal Rate and all previous payments in excess of the Maximum Legal Rate shall be deemed to have been payments in reduction of principal and not on account of the interest due hereunder. All sums paid or agreed to be paid to Lender for the use, forbearance, or detention of the sums due under the Loan, shall, to the extent permitted by applicable law, be amortized, prorated, allocated, and spread throughout the full stated term of the Loan until payment in full so that the rate or amount of interest on account of the Loan (including, to the extent applicable, any prepayment premium and/or penalty) does not exceed the Maximum Legal Rate from time to time in effect and applicable to the Loan for so long as the Loan is outstanding.
Section 2.6.Loan Payments.
(a)Borrower shall make a payment to Lender of interest only on the Closing Date for the period from (and including) the Closing Date through (and including) the fourteenth (14th) day of either (i) the month in which the Closing Date occurs (if the Closing Date occurs on or before the fourteenth (14th) day of such month), or (ii) the month following the month in which the Closing Date occurs (if the Closing Date occurs on or after the fifteenth (15th) day of the then current calendar month); provided, however, if the Closing Date is the fourteenth (14th) day of a calendar month, no such separate payment of interest shall be due. Borrower shall make a payment to Lender of interest in the amount of the Monthly Debt Service Payment Amount on the First Monthly Payment Date and on each Monthly Payment Date occurring thereafter to and including the Maturity Date. Each payment shall be applied first to accrued and unpaid interest,
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and then to other amounts due and unpaid pursuant to this Agreement and the other Loan Documents and the balance, if any, shall be funded to Borrower’s operating account so long as no Event of Default has occurred and is continuing. Provided no Event of Default has occurred and is continuing, payments pursuant to this Section 2.6 shall be applied to interest accrued, or to be accrued for the related Interest Accrual Period in which the Monthly Payment Date occurs for each Component of the Loan, as follows: (i) first, to the payment of interest then due and payable under Component A; (ii) second, to the payment of interest then due and payable under Component B; (iii) third, to the payment of interest then due and payable under Component C; and (iv) fourth, to the payment of interest then due and payable under Component H-RR.
(b)Borrower shall pay to Lender on the Maturity Date the outstanding principal balance of the Loan, all accrued and unpaid interest and all other amounts due hereunder and under the Note, the Security Instrument, the Pledge Agreement and the other Loan Documents (including, without limitation, the Interest Shortfall).
(c)If any principal, interest or any other sum due under the Loan Documents, other than the payment of principal due on the Maturity Date, is not paid by Borrower on the date on which it is due, Borrower shall pay to Lender upon demand an amount equal to the lesser of four percent (4%) of such unpaid sum or the maximum amount permitted by applicable law in order to defray the expense incurred by Lender in handling and processing such delinquent payment and to compensate Lender for the loss of the use of such delinquent payment. Any such amount shall be secured by the Security Instrument, the Pledge Agreement and the other Loan Documents.
(d)Except as otherwise specifically provided herein, all payments and prepayments under this Agreement and the Note shall be made to Lender not later than 3:00 P.M., New York City time, on the date when due and shall be made in lawful money of the United States of America in immediately available funds at Lender’s office, and any funds received by Lender after such time shall, for all purposes hereof, be deemed to have been paid on the next succeeding Business Day.
(e)Whenever any payment to be made hereunder or under any other Loan Document shall be stated to be due on a day which is not a Business Day, the due date thereof shall be deemed to be the immediately succeeding Business Day.
(f)All payments required to be made by Borrower hereunder or under the Note or the other Loan Documents shall be made irrespective of, and without deduction for, any setoff, claim or counterclaim and shall be made irrespective of any defense thereto.
(g)All payments of principal and interest shall be applied to Note A‑1, Note A‑2 and Note A‑3 on a pro rata, pari passu basis.
Section 2.7.Prepayments.
(a)Voluntary Prepayment. Except as provided in this Section 2.7 and Section 2.10, Borrower shall not have the right to voluntarily prepay the Loan in whole or in part.
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(b)Borrower may, provided no Event of Default has occurred and is continuing, at its option and upon prior revocable notice to Lender as set forth herein, prepay the Debt in whole or in part on any Business Day; provided that such prepayment is accompanied by (x) payment of the Prepayment Premium and the applicable Interest Shortfall and (y) the delivery of satisfactory evidence that each Mezzanine Loan is simultaneously being prepaid on a pro rata basis in accordance with the terms of the related Mezzanine Loan Documents. Lender shall not be obligated to accept any prepayment unless it is accompanied by payment of the Breakage Costs, the Prepayment Premium and the applicable Interest Shortfall due in connection therewith. As a condition to any voluntary prepayment, Borrower shall give Lender written notice (a “Prepayment Notice”) of its intent to prepay, (in such case, only with respect to a refinancing of the Loan and not with respect to sales of Property (notice of which is governed by Section 2.10 hereof)), which notice must be given at least thirty (30) days (or such shorter period of time as may be permitted by Lender in its sole discretion) and not more than ninety (90) days (or such longer period of time as may be permitted by Lender in its sole discretion) prior to the Business Day upon which prepayment is to be made and must specify the Business Day on which such prepayment is to be made. Borrower hereby agrees that, in the event Borrower delivers a Prepayment Notice and fails to prepay the Loan in accordance with the Prepayment Notice and the terms of this Section 2.7 or revokes its notice of prepayment (a “Prepayment Failure”), Borrower shall pay Lender all reasonable out-of-pocket costs and expenses incurred by Lender, including, without limitation, any Breakage Costs or similar expenses, as a result of such Prepayment Failure. Any prepayment received by Lender pursuant to this Section 2.7(b) on a date other than a Monthly Payment Date shall be held by Lender as collateral security for the Loan in an interest bearing, Eligible Account at an Eligible Institution, with such interest accruing to the benefit of Borrower, and shall be applied by Lender on the next Monthly Payment Date, with any interest on such funds (I) to the extent that no Trigger Period and no Event of Default then exists, paid to Borrower and (II) to the extent no Event of Default then exists, but a Trigger Period then exists, deposited into the Cash Management Account. No Mezzanine Loan may be voluntarily prepaid in whole or in part unless there is a simultaneous pro rata prepayment of the Loan and each other Mezzanine Loan.
(c)Mandatory Prepayment.
(i)On each date on which Lender actually receives a distribution of Net Proceeds relating to the Plaza del Sol Property or any Individual Continental Property, and if Lender is not required to and does not make such Net Proceeds (but, with respect to the Plaza del Sol Property, specifically excluding the Casualty Proceeds and any other proceeds on account of the Prior Hurricane Damage (Plaza del Sol)) available to Borrower for Restoration or for disbursement as Rent Loss Proceeds (as applicable), in each case, in accordance with the applicable terms and conditions hereof, Borrower shall, at Lender’s option, prepay the Debt in an amount equal to the aggregate of (A) the Net Proceeds up to an amount equal to the Minimum Release Price for the Plaza del Sol Property or such Individual Continental Property, as applicable, (B) the applicable Interest Shortfall and Breakage Costs and (C) the actual reasonable costs of Lender in connection with such prepayment to the extent such amounts are not paid to Lender in accordance with Article 7 hereof (collectively, the “Mortgage Mandatory Prepayment Amount”). Except during the continuance of an Event of Default, any Net Proceeds (but, with respect to the Plaza del Sol Property, specifically excluding the Casualty Proceeds and any other proceeds on account of the Prior Hurricane Damage (Plaza del Sol)) to
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be applied pursuant to this Section 2.7(c) hereof in excess of the Mortgage Mandatory Prepayment Amount shall be applied as follows: (I) first, to the Mezzanine Lender, in an amount equal to the Mezzanine Mandatory Prepayment Amount (as such term is defined in the Mezzanine Loan Documents), to be applied in accordance with the Mezzanine Loan Documents, and (II) second, to Borrower.
(ii)On each date on which Lender actually receives a distribution of Net Proceeds relating to a Puerto Rico Portfolio Property, and if Lender is not required to and does not make such Net Proceeds (but specifically excluding the Casualty Proceeds and any other proceeds on account of the Prior Hurricane Damage) available to Borrower for Restoration or for disbursement as Rent Loss Proceeds (as applicable), in each case, in accordance with the applicable terms and conditions hereof, Borrower shall, at Lender’s option, prepay the Debt in an amount equal to 100% of such Net Proceeds (but specifically excluding the Casualty Proceeds and any other proceeds on account of the Prior Hurricane Damage), together with the applicable Interest Shortfall and Breakage Costs and the actual reasonable costs of Lender in connection with such prepayment to the extent such amounts are not paid to Lender in accordance with Article 7 hereof.
(iii)Borrower shall make the REMIC Payment as and to the extent required hereunder. No Prepayment Premium or penalty (including, without limitation, any Default Prepayment Premium) shall be due in connection with any prepayment made pursuant to this Section 2.7(c) (including, without limitation, in connection with any REMIC Payment). Any prepayment received by Lender pursuant to this Section 2.7(c) on a date other than a Monthly Payment Date shall be held by Lender as collateral security for the Loan in an interest bearing, Eligible Account at an Eligible Institution, with such interest accruing to the benefit of Borrower, and shall be applied by Lender on the next Monthly Payment Date, with any interest on such funds (I) to the extent that no Trigger Period and no Event of Default then exists, paid to Borrower and (II) to the extent no Event of Default then exists, but a Trigger Period then exists, deposited into the Cash Management Account.
(d)Prepayments After Default. After the occurrence and during the continuance of an Event of Default and notwithstanding any acceleration of the Debt in accordance with the applicable terms and conditions hereof, the Default Prepayment Premium shall, in all cases, be deemed a portion of the Debt due and owing hereunder and under the other Loan Documents. Without limitation of the foregoing, if, after the occurrence and during the continuance of an Event of Default, (i) payment of all or any part of the Debt is tendered by Borrower (voluntarily or involuntarily), a purchaser at foreclosure or any other Person, (ii) Lender obtains a recovery of all or a portion of the Debt (through an exercise of remedies hereunder or under the other Loan Documents or otherwise) or (iii) the Debt is deemed satisfied (in whole or in part) through an exercise of remedies hereunder or under the other Loan Documents or at law, the Default Prepayment Premium, the Breakage Costs and the Interest Shortfall, in addition to the outstanding principal balance, all accrued and unpaid interest and other amounts payable under the Loan Documents, shall be deemed due and payable hereunder. Notwithstanding anything to the contrary contained herein or in any other Loan Document, during the continuance of an Event of Default (i) any prepayment of the Debt shall be applied to the Debt in such order and priority as may be determined by Lender in its sole discretion and (ii)
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the word “prepayment” when used herein and in the other Loan Documents shall also be deemed to mean repayment and payment.
(e)Application of Prepayments to Components. Any principal payments received on the Loan when no Event of Default exists shall be applied by Lender between the Components of Loan (a) first, to the reduction of the outstanding principal balance of Component A until reduced to zero, (b) second, to the reduction of the outstanding principal balance of Component B until reduced to zero, (c) third, to the reduction of the outstanding principal balance of Component C until reduced to zero and (d) fourth, to the reduction of the outstanding principal balance of Component H-RR. Following any Event of Default, any payment of principal from whatever source may be applied by Lender between the Components of the Loan in Lender’s sole discretion.
Section 2.8.Interest Rate Cap Agreement.
(a)Prior to or contemporaneously with the Closing Date, Borrower shall enter into an Interest Rate Cap Agreement with a LIBOR (or Prime Rate or Alternate Rate, as applicable) strike rate equal to the Strike Rate. The Interest Rate Cap Agreement (i) shall at all times be in a form and substance reasonably acceptable to Lender, (ii) shall at all times be with a Counterparty, (iii) shall at all times be for a duration at least equal to the end of the Interest Accrual Period in which the then current Maturity Date occurs, and (iv) shall at all times have a notional amount (in the aggregate of the notional amounts provided in all such agreements) equal to or greater than the outstanding principal balance of the Loan and shall at all times provide for the applicable LIBOR (or Prime Rate or Alternate Rate, as applicable) strike rate to be equal to the Strike Rate. Borrower shall direct such Counterparty to deposit directly into the Cash Management Account any amounts due Borrower under such Interest Rate Cap Agreement so long as any portion of the Debt is outstanding, provided that the Debt shall be deemed to be outstanding if the Property is transferred by judicial or non-judicial foreclosure or deed-in-lieu thereof. Additionally, Borrower shall collaterally assign to Lender, pursuant to the Collateral Assignment of Interest Rate Cap Agreement, all of its right, title and interest in and to the Interest Rate Cap Agreement (and any replacements thereof), including, without limitation, its right to receive any and all payments under the Interest Rate Cap Agreement (and any replacements thereof), and Borrower shall, and shall cause Counterparty to, deliver to Lender a fully executed Interest Rate Cap Agreement (which shall, by its terms, authorize the assignment to Lender and require that payments be deposited directly into the Cash Management Account). Notwithstanding anything contained herein to the contrary, the initial Interest Rate Cap Agreement was purchased by RVT Noble Town Center LLC, RVT Newnan Crossing LLC and DDR Norte LLC, S.E., each as nominee for itself and the other Borrowers.
(b)Borrower shall comply with all of its obligations under the terms and provisions of the Interest Rate Cap Agreement. All amounts paid by the Counterparty under the Interest Rate Cap Agreement to Borrower or Lender shall be deposited immediately and directly into the Cash Management Account. Borrower shall take all actions reasonably requested by Lender to enforce Lender’s rights under the Interest Rate Cap Agreement in the event of a default by the Counterparty and shall not waive, amend or otherwise modify any of its rights thereunder.
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(c)In the event of any downgrade, withdrawal or qualification of the rating of the Counterparty (or any related guarantor) by any Rating Agency below the Minimum Counterparty Rating, Borrower shall replace the Interest Rate Cap Agreement not later than ten (10) Business Days following receipt of notice of such downgrade, withdrawal or qualification with an Interest Rate Cap Agreement in form and substance reasonably satisfactory to Lender (and meeting the requirements set forth in this Section 2.8) (a “Replacement Interest Rate Cap Agreement”) from a Counterparty (or guarantor, as applicable) reasonably acceptable to Lender having a Minimum Counterparty Rating.
(d)Borrower shall deliver to Lender a new Collateral Assignment of Interest Rate Cap Agreement acceptable to Lender in connection with each new Interest Rate Cap Agreement, Substitute Interest Rate Cap Agreement and Replacement Interest Rate Cap Agreement. In the event that Borrower fails to purchase and deliver to Lender the Interest Rate Cap Agreement or fails to maintain the Interest Rate Cap Agreement in accordance with the terms and provisions of this Agreement, Lender may purchase the Interest Rate Cap Agreement and the cost incurred by Lender in purchasing such Interest Rate Cap Agreement shall be paid by Borrower to Lender with interest thereon at the Default Rate from the date such cost was incurred by Lender until such cost is reimbursed by Borrower to Lender.
(e)Each Interest Rate Cap Agreement shall contain the following language or its equivalent: “In the event of any downgrade, withdrawal or qualification of the rating of the Counterparty (or the guarantor of such Counterparty’s obligations) below (a) a long-term unsecured debt rating of “A-” by S&P, which rating shall not include a “t” or otherwise reflect a termination risk or otherwise be qualified; (b) a long-term unsecured debt rating of not less than “A3” by Xxxxx’x which rating shall not include a “t” or otherwise reflect a termination risk or otherwise be qualified; and/or (c) if the Counterparty (or the guarantor of such Counterparty’s obligations) is rated by Fitch and Fitch is rating any of the Securities, a long-term unsecured debt rating of “A-” (and not on Rating Watch Negative) by Fitch and a short-term unsecured debt rating of not less than “F‑1” (and not on Rating Watch Negative) from Fitch, the Counterparty must, within ten (10) business days find a replacement Counterparty, at the Counterparty’s sole cost and expense, acceptable to each Rating Agency and Borrower; provided that, notwithstanding such a downgrade, withdrawal or qualification, unless and until the Counterparty transfers the Interest Rate Cap Agreement to a replacement Counterparty pursuant to the foregoing, the Counterparty will continue to perform its obligations under the Interest Rate Cap Agreement. Failure to satisfy the foregoing shall constitute an “Additional Termination Event” as defined by Section 5(b)(v) of the ISDA Master Agreement, with the Counterparty as the “Affected Party.”” In the event that a Counterparty is required pursuant to the terms of an Interest Rate Cap Agreement to find a replacement Counterparty, Borrower covenants and agrees that Borrower shall seek Lender’s approval with respect thereto and shall not approve or consent to the foregoing unless and until Borrower receives Lender’s prior written approval and shall approve or consent to the foregoing upon receipt of Lender’s prior written approval. Borrower’s failure to comply with the requirements of this Section 2.8(e) shall constitute, at Lender’s option, an immediate Event of Default.
(f)With respect to each Interest Rate Cap Agreement, Borrower shall obtain and deliver to Lender an opinion from counsel (which counsel may be in house counsel for the Counterparty) for (x) the Counterparty (upon which Lender and its successors and assigns may
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rely) and (y) to the extent the Counterparty is SMBC Capital Markets, Inc., the related guarantor (upon which Lender and its successors and assigns may rely) which shall provide, in relevant part, that:
(i)each of the Counterparty and the related guarantor, if applicable, is duly organized, validly existing, and in good standing under the laws of its jurisdiction of incorporation and has the organizational power and authority to execute and deliver, and to perform its obligations under, the Interest Rate Cap Agreement and the related guaranty, as applicable;
(ii)the execution and delivery of the Interest Rate Cap Agreement by the Counterparty, the related guaranty by such guarantor and any other agreement which the Counterparty and the related guaranty, as applicable, has executed and delivered pursuant thereto, and the performance of Counterparty’s and the guarantor’s obligations thereunder have been and remain duly authorized by all necessary action and do not contravene any provision of Counterparty’s and the guarantor’s certificate of incorporation or by-laws (or equivalent organizational documents) or any law, regulation or contractual restriction binding on or affecting Counterparty’s and the guarantor’s property;
(iii)all consents, authorizations and approvals required for the execution and delivery by the Counterparty of the Interest Rate Cap Agreement, the related guaranty by such guarantor, and any other agreement which the Counterparty has executed and delivered pursuant thereto, and the performance of Counterparty’s and guarantor’s obligations thereunder have been obtained and remain in full force and effect, all conditions thereof have been duly complied with, and no other action by, and no notice to or filing with any governmental authority or regulatory body is required for such execution, delivery or performance; and
(iv)the Interest Rate Cap Agreement, and any other agreement which each of the Counterparty and guarantor has executed and delivered pursuant thereto, has been duly executed and delivered by the Counterparty and guarantor and constitutes the legal, valid and binding obligation of each of the Counterparty and guarantor, enforceable against the Counterparty and guarantor in accordance with its terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors’ rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law).
(g)Prior to purchasing any Interest Rate Cap Agreement or Replacement Interest Rate Cap Agreement, Borrower shall provide written notice of the terms of any such agreement to Lender (the “Rate Cap Notice”). Upon receipt of the Rate Cap Notice, any Affiliate of Lender shall have the right to match the terms thereof, and if such Affiliate so matches, Borrower shall be required to purchase such agreement from such Affiliate of Lender.
(h)Provided there exists no Event of Default, in the event that (i) any of the Properties owned by RVT Noble Town Center LLC, RVT Newnan Crossing LLC and DDR Norte LLC, S.E. have been released from the liens of the Loan Documents in accordance with this Agreement (other than those obligations (including indemnification obligations) which expressly survive release or repayment of the Loan), upon prior written notice to Lender and
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Counterparty, or (ii) Sponsor, in good faith, determines that such assignment is necessary for Sponsor to qualify as a REIT or in connection with a transfer contemplated under Section 6.3(iii) hereof, RVT Noble Town Center LLC, RVT Newnan Crossing LLC and DDR Norte LLC, S.E., may assign all or any portion of their respective right, title and interest in and to the Interest Rate Cap Agreement to another Borrower under the Loan that owns one or more Properties then remaining subject to the liens of the Loan Documents (such Borrower, the “Assignee Borrower”). In connection with (and as a condition precedent to) such assignment, Counterparty, Assignor (as defined in the Collateral Assignment of Interest Rate Cap Agreement, which, for the avoidance of doubt, may refer to RVT Noble Town Center LLC, RVT Newnan Crossing LLC and DDR Norte LLC, S.E. or any Assignee Borrower that has assumed the interests of “Assignor” under the Collateral Assignment of Interest Rate Cap Agreement pursuant to and in accordance with this Agreement) and other Borrowers shall deliver to Lender (x) an assumption of the existing Collateral Assignment of Interest Rate Cap Agreement reasonably acceptable to Lender (or a new assignment of interest rate cap agreement in form and substance substantially similar to the Collateral Assignment of Interest Rate Cap Agreement delivered to Lender on the Closing Date and otherwise reasonably acceptable to Lender) executed by Assignee Borrower and (y) an acknowledgment and consent to such assumption or new assignment of interest rate cap agreement executed by Counterparty and reasonably acceptable to Lender. Any Assignee Borrower may further assign its right, title and interest in and to the Interest Rate Cap Agreement to another Assignee Borrower, provided all of the conditions set forth in this Section 2.8(h) are satisfied.
(i)Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, if, at any time, Lender converts the Loan from (I) a LIBOR Loan to either a Prime Rate Loan or an Alternate Rate Loan, (II) a Prime Rate Loan to an Alternate Rate Loan or (III) an Alternate Rate Loan to a Prime Rate Loan, each in accordance with Section 2.5 above (each, a “LIBOR Conversion”), then:
(i)within thirty (30) days after such LIBOR Conversion, Borrower shall either (A) enter into, make all payments under, and satisfy all conditions precedent to the effectiveness of, a Substitute Interest Rate Cap Agreement (and in connection therewith, but not prior to Borrower taking all the actions described in this clause (i), Borrower shall have the right to terminate any then-existing Interest Rate Cap Agreement) or (B) cause the then-existing Interest Rate Cap Agreement to be modified such that such then-existing Interest Rate Cap Agreement satisfies the requirements of a Substitute Interest Rate Cap Agreement as set forth below in the definition thereof (a “Converted Interest Rate Cap Agreement”); and
(ii)following such LIBOR Conversion (provided Lender has not converted the Loan back to a LIBOR Loan in accordance with Section 2.5 hereof), in lieu of satisfying the condition described in Section 2.9(c) with respect to any outstanding Extension Option, Borrower shall instead enter into, make all payments under, and satisfy all conditions precedent to the effectiveness of a Substitute Interest Rate Cap Agreement on or prior to the first day of such Extension Option.
(j)As used herein, “Substitute Interest Rate Cap Agreement” shall mean an interest rate cap agreement between a Counterparty and Borrower, obtained by Borrower and collaterally assigned to Lender pursuant to this Agreement and shall contain each of the following:
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(i)a term expiring no earlier than the end of the Interest Accrual Period associated with the then applicable Maturity Date;
(ii)the notional amount of the Substitute Interest Rate Cap Agreement shall be equal to or greater than the then outstanding principal balance of the Loan;
(iii)it provides that the only obligation of Borrower thereunder is the making of a single payment to the Counterparty thereunder upon the execution and delivery thereof;
(iv)it provides to Lender and Borrower (as determined by Lender in its sole but good faith discretion) for the term of the Substitute Interest Rate Cap Agreement, a hedge against rising interest rates that is no less beneficial to Borrower and Lender than (A) in the case of clause (c) above, that which was provided by the Interest Rate Cap Agreement being replaced by the Substitute Interest Rate Cap Agreement and (B) in the case of clause (c) above, that which was intended to be provided by the Interest Rate Cap Agreement that, but for the operation of this Section 2.8(j), would have been required to have been delivered by Borrower pursuant to Section 2.9(c) below as a condition to the requested Extension Option; and
(v)without limiting any of the provisions of the preceding clauses (i) through (iv) above, it satisfies all of the requirements set forth in clauses (i) through (iii) of Section 2.8(a) hereof.
From and after the date of any LIBOR Conversion, all references to “Interest Rate Cap Agreement” and “Replacement Interest Rate Cap Agreement” herein (other than in the definition of “Interest Rate Cap Agreement”, the definition of “Replacement Interest Rate Cap Agreement” and as referenced in the first sentence of Section 2.8(a) hereof) shall be deemed to refer or relate, as applicable, to a Substitute Interest Rate Cap Agreement or a Converted Interest Rate Cap Agreement, as the case may be.
Notwithstanding anything to the contrary set forth in this Section 2.8(j), Borrower shall not be required to obtain a Substitute Interest Rate Cap Agreement or Converted Interest Rate Cap Agreement, as applicable, during any period when the Loan is outstanding as a Prime Rate Loan (a) if the LIBOR Conversion occurs prior to a Securitization, if such a Substitute Interest Rate Cap Agreement or Converted Interest Rate Cap Agreement, as the case may be, is (1) not then commercially available at commercially reasonable rates and (2) not required for commercial mortgage loans similar to the Loan or (b) if the LIBOR Conversion occurs following a Securitization, if a Substitute Interest Rate Cap Agreement or Converted Interest Rate Cap Agreement, as the case may be, is not then commercially available. If Borrower is not required to obtain a Substitute Interest Rate Cap Agreement or Converted Interest Rate Cap Agreement pursuant to the terms of this Section 2.8, then Borrower and Lender shall work together to find a mutually agreeable alternative to a Substitute Interest Rate Cap Agreement or Converted Interest Rate Cap Agreement that would afford Lender substantially equivalent protection from increases in the interest rate.
Section 2.9.Extension of the Maturity Date. Borrower shall have the option to extend the term of the Loan beyond the initial Stated Maturity Date for three (3) successive terms
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(the “Extension Option”) of one (1) year each (each, an “Extension Period”) to (i) the Monthly Payment Date occurring in March, 2022 if the first Extension Option is exercised, (ii) the Monthly Payment Date occurring in March, 2023 if the second Extension Option is exercised and (iii) the Monthly Payment Date occurring in March, 2024 if the third Extension Option is exercised (each such date, the “Extended Maturity Date”) upon satisfaction of the following terms and conditions:
(a)no Event of Default shall have occurred and be continuing at the time an Extension Option is exercised or on the date that the applicable Extension Period is commenced;
(b)Borrower shall notify Lender of its election to extend the applicable Maturity Date as aforesaid not earlier than ninety (90) days and no later than thirty (30) days prior to the applicable Maturity Date; provided, however, that Borrower shall be permitted to revoke such notice at any time before the applicable Maturity Date provided that Borrower pays to Lender all actual reasonable out-of-pocket costs incurred by Lender in connection with such notice, including, without limitation, any Breakage Costs;
(c)Borrower shall obtain and deliver to Lender prior to exercise of such Extension Option, a Replacement Interest Rate Cap Agreement or a Substitute Interest Rate Cap Agreement, as applicable, which Replacement Interest Rate Cap Agreement or a Substitute Interest Rate Cap Agreement, as applicable, shall be effective commencing on the first day of the related Extension Period and shall have a maturity date not earlier than the last day of the Interest Accrual Period in which the related Extended Maturity Date shall occur;
(d)Borrower pays to Lender all actual reasonable out-of-pocket costs incurred by Lender in connection with the exercise of such Extension Option;
(e)in connection with the (i) second Extension Option, the Debt Yield shall not be less than 13.0% at the time such Extension Option is exercised and on the date that such Extension Period is commenced; and (ii) the third Extension Option, the Debt Yield shall not be less than 14.0% at the time such Extension Option is exercised and on the date that such Extension Period is commenced;
(f)if any Mezzanine Loan is then outstanding, Lender shall have received evidence that such Mezzanine Loan shall have been repaid or extended (or will be contemporaneously extended) through a date not earlier than the applicable Extended Maturity Date; and
(g)with respect to the third Extension Option, on the first day of the third Extension Period, the LIBOR Spread (or the Prime Rate Spread or Alternate Rate Spread, as applicable) shall permanently increase by 25 basis points (.25%) (including an increase in the spread of each Component on a pro rata basis).
Borrower shall have the right, if it so elects, to satisfy the minimum Debt Yield requirement set forth in clause (e) above by (i) making a prepayment of the Loan in accordance with Section 2.7 hereof an amount which, after such prepayment of the Loan, would be sufficient to reduce the outstanding principal balance of the Loan to an amount which would satisfy such minimum Debt Yield requirement, or (ii) posting with Lender cash (which shall be held by Lender as additional
66
security for the Debt and may be applied to the Debt during the continuance of an Event of Default and otherwise returned to Borrower upon the indefeasible payment in full of the Debt) or a Letter of Credit (which Letter of Credit shall be subject to Section 8.12 hereof) in an amount which, if applied to the outstanding principal balance of the Loan, would be sufficient to reduce the outstanding principal balance of the Loan to an amount which would satisfy such requirement; provided, that, with respect to clause (ii) above, if such Letter of Credit (when aggregated with all other Letters of Credit delivered in accordance with this Agreement) shall exceed ten percent (10%) of the original principal balance of the Loan, Borrower shall deliver to Lender a New Non-Consolidation Opinion with respect to such Letter of Credit. All references in this Agreement and in the other Loan Documents to the Stated Maturity Date shall mean the applicable Extended Maturity Date in the event the applicable Extension Option is exercised.
Section 2.10.Partial Release of Property or Full Equity Release. Subject to the conditions set forth below, Borrower (or Pledgor, as applicable) shall have the right at any time prior to the Maturity Date to obtain the release (the “Partial Release”) of (x) one or more Individual Properties and/or (y) 100% of the Equity Interests in a Puerto Rico Borrower in connection with the sale of the related Individual Puerto Rico Property or the related Equity Interests (each such released Individual Property and/or Equity Interests, individually and/or collectively, as the context may require, the “Released Property”) from the lien of the applicable Security Instrument thereon (and related Loan Documents) and/or the Pledge Agreement, as applicable, and the release of Borrower’s obligations under the Loan Documents with respect to such Released Property (other than those expressly stated to survive), upon the satisfaction of each of the following conditions precedent:
(a)Borrower shall provide Lender with ten (10) Business Days prior written notice of the proposed Partial Release (the date of Lender’s receipt of such notice shall be referred to herein as a the “Partial Release Notice Date”) (which notice may be amended or revoked upon prior written notice provided that Borrower reimburses Lender for all reasonable costs and expenses actually incurred by Lender in reliance on such notice, including, without limitation, any Breakage Costs);
(b)No Event of Default shall have occurred and be continuing on either the Partial Release Notice Date or the date of consummation of the Partial Release; provided, however, if an Event of Default then exists which Event of Default is specific to an Individual Property, then the absence of such Event of Default shall not be a condition to the Partial Release of such Individual Property, if (but only to the extent that) such Partial Release of the applicable Individual Property would cure the applicable Event of Default and no other Events of Default shall be continuing after such Partial Release;
(c)Borrower shall submit to Lender, not less than ten (10) days prior to the date of such Partial Release, a release of lien (and related Loan Documents) for the Released Property for execution by Lender. Such release shall be in a form appropriate in each jurisdiction in which the Released Property is located and shall contain standard provisions, if any, protecting the rights of Lender. In connection with any such Partial Release of an Individual Puerto Rico Property, Lender shall deliver the original certificates representing the ownership interests pledged under the Pledge Agreement and related to the Individual Puerto Rico Property that is the subject of such Partial Release. In addition, Borrower shall provide an
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Officer’s Certificate certifying that such documentation (i) is in compliance with all applicable Legal Requirements, (ii) will effect such release in accordance with the terms of this Agreement, and (iii) will not impair or otherwise adversely affect the liens, security interests and other rights of Lender under the Loan Documents not being released (or as to the parties to the Loan Documents and Properties subject to the Loan Documents not being released);
(d)Other than in connection with any Partial Release resulting in the payment in full of the Debt (which, for the avoidance of doubt, shall not be conditioned on the satisfaction of the requirement in this clause (d)), the Partial Release is made in connection with in connection with the sale of such Released Property to a third party on an arm’s length basis, and such Released Property shall be conveyed to a Person other than Borrower, Site Centers or an Affiliate of Borrower or Site Centers, it being acknowledged and agreed that Xxxxxxxxx Xxxx, his family members and any entity affiliated with Xxxxxxxxx Xxxx shall not be deemed an Affiliate of Borrower or Site Centers for purposes of this Section 2.10 (provided, however, that in the event Xxxxxxxxx Xxxx, his family members and/or any entity affiliated with Xxxxxxxxx Xxxx shall be a potential purchaser of an Individual Property or any Equity Interests, Borrower shall provide evidence reasonably acceptable to Lender showing that the approval of such purchase by Xxxxxxxxx Xxxx, his family members and/or any entity affiliated with Xxxxxxxxx Xxxx was approved by all required actions of Sponsor and Borrower without taking into account the vote of Xxxxxxxxx Xxxx, his family members and/or any entity affiliated with Xxxxxxxxx Xxxx that may serve on the board (or act as an officer or director) of any of Sponsor, Borrower or their Affiliates);
(e)Borrower shall (A) partially prepay the Debt in accordance with Section 2.7(b) or (c) hereof, as applicable, in an amount equal to the Release Price for the Released Property (the “Release Amount”), which applicable Release Amount for the Plaza del Sol Property or the applicable Individual Continental Property, as applicable, shall be no less than the applicable Minimum Release Price (taking into account any applied Excess Release Amount) for the Plaza del Sol Property or such Individual Continental Property, as applicable, and (B) pay any applicable Interest Shortfall due hereunder in connection therewith, it being acknowledged and agreed that no Prepayment Premium shall be due and payable in connection with any Partial Release;
(f)As of the date of consummation of the Partial Release, after giving effect to the release of the lien of the Security Instrument(s) encumbering (and/or the Pledge Agreement affecting, as applicable) the Released Property, the Debt Yield with respect to the Plaza del Sol Property and/or the remaining Individual Continental Properties, as applicable, shall be greater than the greater of (1) the Debt Yield of the Plaza del Sol Property and/or all Individual Continental Properties, as applicable, encumbered by the Security Instrument (and/or the Pledge Agreement, as applicable) immediately prior to the consummation of the Partial Release, and (2) the Minimum Debt Yield (provided, that, Borrower shall have the right to prepay the Loan in accordance with Section 2.7(b) or (c) hereof, as applicable, in an amount sufficient to satisfy the requirements of this clause (f));
(g)If the Released Property is a Combined Individual Property Parcel, then Borrower shall have satisfied (as determined by Lender in its reasonable discretion), the following terms and conditions:
(i)Prior to the transfer and release of the Combined Individual Property Parcel in question, (A) each applicable municipal authority exercising jurisdiction over
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such Combined Individual Property shall have approved a lot-split ordinance or other applicable action under local law dividing the Combined Individual Property Parcel from the remainder of the affected Combined Individual Property, and a separate tax identification number shall have been issued for the Combined Individual Property Parcel and the remainder of the Combined Individual Property in question (with the result that, upon the transfer and release of the Combined Individual Property Parcel in question, no part of the remaining affected Combined Individual Property shall be part of a tax lot or zoning lot which includes any portion of such Combined Individual Property Parcel), (B) an application has been made under local law to the appropriate Governmental Authority for approval of a lot-split ordinance or other application action and for a separate tax identification number for the Combined Individual Property Parcel and the remainder of the Combined Individual Property and the transferee and transferor Borrower shall have otherwise entered into a property tax allocation agreement which has materially the same economic effect of a tax lot subdivision or (C) the Combined Individual Property Parcel and the remainder of the Combined Individual Property shall already constitute separate tax lots for transfer purposes (as confirmed by a title company);
(ii)All Legal Requirements applicable to the Combined Individual Property Parcel in question and the remaining affected Combined Individual Property necessary to accomplish the lot split shall have been fulfilled, and all necessary variances, if any, shall have been obtained, and Borrower shall have delivered to Lender either (A) letters or other evidence from the appropriate municipal authorities confirming such compliance with laws or (B) a zoning report, legal opinion or other evidence confirming such compliance with laws, in each case in substance reasonably satisfactory to Lender;
(iii)As a result of the lot split, the remaining Combined Individual Property (after the release of the Combined Individual Property Parcel in question from the remaining affected Combined Individual Property) shall comply in all material respects with all easements appurtenant and other Permitted Encumbrances thereto, will not be in violation of any Leases and then applicable Legal Requirements (that would be reasonably expected to result in a Material Adverse Effect or material default under such Leases) and all necessary variances, if any, shall have been obtained and evidence thereof has been delivered to Lender which in form and substance is appropriate for the jurisdiction in which the applicable Combined Individual Property is located;
(iv)If reasonably necessary, appropriate reciprocal easement agreements for the benefit and burden of the remaining affected Combined Individual Property and the Combined Individual Property Parcel in question regarding the use of common facilities of such parcels, including, but not limited to, roadways, parking areas, utilities and community facilities, in a form and substance reasonably satisfactory to Lender and which easements will not materially adversely affect the remaining Combined Individual Property, shall be declared and recorded, the remaining Combined Individual Property and the applicable Combined Individual Property Parcel shall be in compliance with all applicable covenants under all easements and property agreements contained in the Permitted Encumbrances for the remaining Combined Individual Property;
(v)Borrower shall have delivered to Lender evidence reasonably satisfactory to Lender that the Single Purpose Entity nature and bankruptcy remoteness of Borrower following such release have not been adversely affected and are in accordance with the
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terms and provisions of this Agreement, provided that Borrower shall not be required to deliver a “bring-down” of the Non-Consolidation Opinion or a New Non-Consolidation Opinion;
(vi)Borrower shall have executed and delivered such other documents and instruments that are reasonably requested by Lender and typical for similar transactions;
(vii)If, to the extent that any adjacent parcels (including any remaining Combined Individual Property) to the Combined Individual Property in question shall remain collateral for the Loan and the same were not separately described in the Survey delivered in connection with the closing of the Loan, Borrower shall have delivered a new metes and bounds description Survey for such remaining parcels (including any remaining Combined Individual Property) that are collateral for the Loan;
(viii)Borrower shall have delivered to Lender an endorsement or comfort letter with regard to Lender’s Title Insurance Policy (to the extent available in the applicable state) solely with respect to the remaining Combined Individual Property that (A) extends the date of the Title Insurance Policy to the effective date of the release, (B) insures the priority of the Security Instrument is not affected by such release, and (C) if applicable, insures the rights and benefits of any new or amended reciprocal easement agreement affecting the remaining Combined Individual Property;
(ix)With respect to the Combined Individual Property commonly known as Xxxxxxxx Commons, the Hamilton Commons theater component (located at Block 1320, Lot 8 (on the Survey for the Xxxxxxxx Commons Property delivered in connection with the closing of the Loan)) must be either (I) sold and released prior to the shopping center component (located at Block 1320, Lot 4.01, 5, 7.01 and 7.02 (on the Survey for the Xxxxxxxx Commons Property delivered in connection with the closing of the Loan)) of the Xxxxxxxx Commons Property (which, for clarity, is identified on Schedule 1.1(m) as “Shopping Center”) being released or (II) sold and released with the shopping center component of the Xxxxxxxx Commons Property (i.e., the shopping center component of the Xxxxxxxx Commons Property cannot be released prior to the release of the Xxxxxxxx Commons theater component). For the avoidance of doubt, the “Outback Pad” located at the Combined Individual Property commonly known as Xxxxxxxx Commons and identified on Schedule 1.1(m) may be released at any time;
(x)With respect to the Combined Individual Property commonly known as Tucson Spectrum, solely with respect to the portion of such Combined Individual Property owned by DDR Tucson Spectrum II LLC (such Property, the “Tucson Spectrum II Property”), the Tucson Spectrum II Property theater component (located at Parcel 5380 (on the Survey for the Tucson Spectrum Property delivered in connection with the closing of the Loan)) must be either (I) sold and released prior to the south shopping center component (located at Parcels 5270, 5280, 5290, 5300, 5310, 5330, 5340, 5350, 5360, 5370, 5400 and 5410 (on the Survey for the Tucson Spectrum Property delivered in connection with the closing of the Loan)) of the Tucson Spectrum II Property (which, for clarity, is identified on Schedule 1.1(m) as “South Shopping Center”) being released or (II) sold and released with the south shopping center component of the Tucson Spectrum II Property (i.e., the south shopping center component of the Tucson Spectrum II Property cannot be released prior to the release of the Tucson Spectrum II Property theater component). For the avoidance of doubt, the “Verizon Pad” owned by DDR
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Tucson Spectrum I LLC and “North Shopping Center” owned by DDR Tucson Spectrum I LLC and identified on Schedule 1.1(m) may be released at any time;
(xi)With respect to the Combined Individual Property commonly known as Newnan Crossing, the Newnan Crossing shopping center component (located at Parcels 00-0000-000, 00-0000-000, 00-0000-000, 00-0000-000 and 00-0000-000 (on the Survey for the Newnan Crossing Property delivered in connection with the closing of the Loan)) must be either (I) sold and released prior to the Lowe’s component (located at Parcel 00-0000-000 (on the Survey for the Newnan Crossing Property delivered in connection with the closing of the Loan)) of the Newnan Crossing Property (which, for clarity, is identified on Schedule 1.1(m) as “Lowe’s”) being released or (II) sold and released with the Lowe’s component of the Newnan Crossing Property (i.e., the Lowe’s component of the Newnan Crossing Property cannot be released prior to the release of the Newnan Crossing theater component);
(xii)With respect to the Combined Individual Property commonly known as Peach Street Marketplace, with respect to the portion of the Individual Property owned by RVT Peach Street Square I LLC and leased to TGI Friday’s (the “Friday’s Parcel”) (located at Parcel 40-005-019.3-001.01 (on the Survey for the Peach Street Marketplace Property delivered in connection with the closing of the Loan)) and with respect to the portion of the Individual Property owned by RVT Erie Marketplace LLC and ground leased to Longhorn Steakhouse (the “Longhorn Parcel”) (located at Parcel 40-004-016-0-076.00 (on the Survey for the Peach Street Marketplace Property delivered in connection with the closing of the Loan)), must each be either (I) sold and released prior to (x) the northwest shopping center component owned by RVT Erie Marketplace LLC (the “Northwest Shopping Center Parcel”) (located at Parcel 40-004-016.0-062.00 (on the Survey for the Peach Street Marketplace Property delivered in connection with the closing of the Loan)) of the Peach Street Marketplace Property (which, for clarity, is identified on Schedule 1.1(m) as “Northwest Shopping Center”) or (y) the northeast shopping center component owned by RVT Peach Street Square I LLC (collectively, the “Northeast Shopping Center Parcel”) (located at Parcels 40-005-019.0-104.00, 40-005-019.0-104.01, 40-005-019.2-003.00, 40-005-019.3-001.00, 04-005-019.0-101.00, 04-005-019.0-101.04 and 04-005-019.0-101.05) (on the Survey for the Peach Street Marketplace Property delivered in connection with the closing of the Loan) of the Peach Street Marketplace Property (which, for clarity, is identified on Schedule 1.1(m) as “Northeast Shopping Center”) being released or (II) sold and released with the Northwest Shopping Center Parcel and/or the Northeast Shopping Center Parcel of the Peach Street Marketplace Property (i.e., the Northwest Shopping Center Parcel and/or the Northeast Shopping Center Parcel of the Peach Street Marketplace Property cannot be released prior to the release of the Friday’s Parcel and/or the Longhorn Parcel, as applicable); provided, however, between each other, the Friday’s Parcel and the Longhorn Parcel may be released in any order so long as either the foregoing clause (I) or the foregoing clause (II) is satisfied with respect to such release. For the avoidance of doubt, the “Cinemark” located at the Combined Individual Property commonly known as Peach Street Marketplace and identified on Schedule 1.1(m) may be released at any time; and
(xiii)With respect to the Combined Individual Property commonly known as The Marketplace at Towne Centre, The Marketplace at Towne Centre (a) Comercia Bank component (located at Parcel 38-12410-00A-04R-0000 (on the Survey for The Marketplace at Towne Centre Property delivered in connection with the closing of the Loan)), (b) Rockfish Seafood component (located at Parcel 38-12410-00A-03R-0000 (on the Survey for
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The Marketplace at Towne Centre Property delivered in connection with the closing of the Loan)) and (c) Applebee’s component (located at Parcel 38-12410-00A-02R-0000 (on the Survey for The Marketplace at Towne Centre Property delivered in connection with the closing of the Loan)) must each be either (I) sold and released prior to the shopping center component (located at Parcel 38-12410-00A-001-0000 (on the Survey for The Marketplace at Towne Centre Property delivered in connection with the closing of the Loan)) of The Marketplace at Towne Centre Property (which, for clarity, is identified on Schedule 1.1(m) as “Shopping Center”) being released or (II) sold and released with the shopping center component of The Marketplace at Towne Centre Property (i.e., the shopping center component of The Marketplace at Towne Centre Property cannot be released prior to the release of The Marketplace at Towne Centre Comercia Bank component, Rockfish Seafood component and/or Applebee’s component). For the avoidance of doubt, the Comercia Bank component, the Rockfish Seafood component and the Applebee’s component may be released in any order so long as the terms and conditions of this clause (xiii) are otherwise complied with respect to such release.
(h)Notwithstanding anything to the contrary contained herein or in any other Loan Document, if the Loan is included in a REMIC Trust and the Loan-to-Value Ratio (expressed as a percentage) exceeds or would exceed 125% immediately after giving effect to the release of the applicable Released Property, no release under any provision of this Agreement will be permitted unless the principal balance of the Loan is prepaid by an amount not less than the greater of (i) the Release Price or (ii) the least of the following amounts: (A) only if the Released Property is sold to an unrelated Person, the net proceeds of an arm’s length sale of the Released Property to an unrelated Person, (B) the fair market value of the Released Property at the time of the Partial Release as determined in connection with determining the Loan-to-Value Ratio and (C) an amount such that the Loan-to-Value Ratio (as so determined by Lender in accordance with the provisions of this clause (h)) after giving effect to the Partial Release of the Released Property is not greater than the Loan-to-Value Ratio immediately prior to such Partial Release, unless Lender receives a REMIC Opinion with respect to the Partial Release (provided, however, that any such prepayment shall be deemed a voluntary prepayment but shall not be subject to the Prepayment Premium or to any other premium or penalty);
(i)Borrower hereby acknowledges and agrees that (i) the Individual Properties owned by DDR Mariner Square I LLC and DDR Mariner Square II LLC must be released together, (ii) the Individual Properties owned by BRE DDR Xxxxx Deer Market LLC and BRE DDR Xxxxx Deer Center LLC must be released together and (iii) the Individual Properties owned by RVT Pavilion at Shoppers World LLC and BRE DDR Brookfield LLC must be released together; and
(j)Borrower pay all of Lender’s reasonable out-of-pocket costs and expenses and the costs and expenses of the Rating Agencies in connection with the Partial Release, including, without limitation, reasonable outside counsel fees.
In connection with any release under this Section 2.10, in the event that such release would result in the release of all Individual Properties held by an individual Borrower (each an “Unencumbered Borrower”), such Unencumbered Borrower shall be released (provided so long as there is only one (1) Borrower hereunder, that the Debt has been paid in full) by Lender from the obligations of the Loan Documents, except with respect to those obligations and liabilities which expressly survive the repayment of the Loan pursuant to any Loan Document
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and shall no longer be a Borrower for the purposes of this Agreement. In connection with a release or cancellation of each Unencumbered Borrower, Lender agrees to deliver (i) a UCC-3 financing statement termination or amendment releasing Lender’s security interest in the collateral pledged to Lender relating to each Unencumbered Borrower, and (ii) instruments executed by Lender reasonably necessary to evidence the release of each Unencumbered Borrower from its obligations under the Loan Documents. All reasonable costs and expenses incurred by Lender in connection with such release shall be paid by Borrower.
Notwithstanding anything to the contrary contained in this Section 2.10, the parties hereto hereby acknowledge and agree that after the Securitization of the Loan (or any portion thereof or interest therein), with respect to any Lender approval or similar discretionary rights over any matters contained in this Section 2.10 (any such matter, an “Partial Release Approval Item”), such rights shall be construed such that Lender shall only be permitted to withhold its consent or approval with respect to any Partial Release Approval Item if the same fails to meet the Prudent Lender Standard.
Section 2.11.Components of the Loan. For the purposes of computing interest payable from time to time on the principal amount of the Loan and certain other computations set forth herein, the principal balance of the Loan shall be divided into Components A through H-RR. The principal amount of the Components shall be as follows:
COMPONENT |
|
PRINCIPAL AMOUNT |
A |
|
$899,999,997 |
B |
|
$1 |
C |
|
$1 |
H-RR |
|
$1 |
|
|
|
Section 2.12.Release of Lien Upon Payment in Full. At the request of Borrower in connection with any full prepayment or repayment of the Loan in accordance with the terms of this Agreement and the other Loan Documents, Lender shall: (a) either (i) assign the Security Instruments to any new lender in connection with a refinance of the Loan in accordance with the terms of an assignment document prepared by counsel to Borrower and approved by Lender, which assignment documents shall be without representation or warranty by, or recourse to, Lender, provided that Lender shall represent that such assignment document has been duly authorized, executed and delivered and that Lender has not assigned or encumbered the Security Instruments, or (ii) release the lien of the Security Instruments (and related Loan Documents) in accordance with the terms of a release document prepared by Lender or, at Lender’s option, by counsel to Borrower and approved by Lender, which release document shall be without representation or warranty by, or recourse to, Lender, (b) deliver to or as directed by Borrower the original executed Note and all other original executed notes (or copies thereof if no such original executed note was delivered to Lender in connection with the closing of the Loan) which may have been consolidated, amended and/or restated in connection with the closing of the Loan or, with respect to any note the original of which had been delivered and endorsed to Lender and such original has been lost, destroyed or mutilated, a lost note affidavit (without indemnification) for the benefit of the assignee lender or Borrower, as applicable, and the title insurance company insuring the Security Instruments (if applicable), as assigned, in form sufficient to permit such title insurance company to insure the lien of the Security Instruments as assigned to and held by
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the assignee without exception for any matter relating to the lost, destroyed or mutilated note, (c) in the case of an assignment, execute and deliver an allonge with respect to the Note and, to the extent endorsed to Lender, any other note(s) as described in the preceding clause (b) above without recourse, covenant or warranty of any nature, express or implied (except as to the outstanding principal balance of the Loan and that Lender owns the Note free of any liens and encumbrances and has the authority to execute and deliver the allonge), (d) deliver the original executed Security Instrument or a certified copy of record, and (e) execute and deliver such other instruments of conveyance, assignment, termination, severance and release (including appropriate UCC-3 termination statements) in recordable form and otherwise in form and substance reasonably satisfactory to Lender and which may reasonably be requested by Borrower to evidence such assignment, release and/or severance, as applicable. All reasonable out-of-pocket costs and expenses incurred by Lender, including, without limitation, reasonable attorney’s fees, as well as any recording charges, filing fees, taxes or other expenses, in connection with the foregoing shall be paid by Borrower.
Section 2.13.Release Upon Payment in Full. Upon payment in full of the Debt in accordance with the terms and provisions of the Note and this Agreement and the other Loan Documents, Lender shall, upon the written request and at the sole cost and expense (including Lender’s reasonable attorneys’ fees and disbursements) of Borrower, release the lien of the Security Instrument and the other Loan Documents (except that those that expressly survive such release) on each Individual Property and the Pledged Collateral, in each case not theretofore released.
Section 2.14.Sale of the Puerto Rico Portfolio. Subject to the conditions set forth below, Borrower and Pledgor shall have the one-time right at any time prior to the Maturity Date to obtain the release (such release, the “PR Portfolio Release”) of all of the Pledged Collateral (as defined in the Pledge Agreement) (but excluding the Pledged Collateral related to the Plaza del Sol Borrower, which release is addressed solely in Section 2.10 above) and the Individual Puerto Rico Properties (but excluding the Plaza del Sol Property, which release is addressed solely in Section 2.10 above) (such Pledged Collateral (but excluding the Pledged Collateral related to the Plaza del Sol Borrower, which release is addressed solely in Section 2.10 above) and the Individual Puerto Rico Properties (but excluding the Plaza del Sol Property, which release is addressed solely in Section 2.10 above), collectively, the “Puerto Rico Portfolio”), upon the satisfaction of each of the following conditions precedent:
(a)Borrower shall provide Lender with ten (10) Business Days prior written notice of the proposed sale (the date of Lender’s receipt of such notice shall be referred to herein as a “PR Portfolio Release Notice Date”), which notice shall be accompanied by an Officer’s Certificate (I) certifying that (x) Borrower and/or Pledgor are conveying all or some of the their respective interests in the Puerto Rico Portfolio to one buyer pursuant to one transaction, (y) none of the interests in the Puerto Rico Portfolio will be retained by a Borrower or Pledgor under the Loan and (II) identifying the amount of interests (which shall be less than 100%) in the Puerto Rico Portfolio that will be retained by Sponsor or its Affiliates (which notice may be amended or revoked upon prior written notice provided that Borrower reimburses Lender for all reasonable costs and expenses actually incurred by Lender in reliance on such notice, including, without limitation, any Breakage Costs);
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(b)No Event of Default shall have occurred and be continuing on either the PR Portfolio Release Notice Date or the date of consummation of the sale of the Puerto Rico Portfolio;
(c)Borrower shall submit to Lender, not less than ten (10) days prior to the date of such PR Portfolio Release, a release of lien (and related Loan Documents) for the Puerto Rico Portfolio for execution by Lender (including, terminations of the Lender’s security interest in the Casualty Proceeds Restricted Account only to the extent that the Plaza del Sol Property has previously been released in accordance with the terms and conditions of this Agreement) and UCC-3 termination statements related to the Puerto Rico Portfolio for approval by Lender. Such release shall be in a form appropriate in each jurisdiction in which the Puerto Rico Portfolio is located and shall contain standard provisions, if any, protecting the rights of Lender. In connection with any such PR Portfolio Release, Lender shall deliver the original certificates representing the ownership interests pledged under the Pledge Agreement solely with respect to the Puerto Rico Portfolio (to the extent the same have not been previously delivered in connection with a Partial Release pursuant to Section 2.10 hereof). In addition, Borrower shall provide an Officer’s Certificate certifying that such documentation (i) is in compliance with all applicable Legal Requirements, (ii) will effect such release in accordance with the terms of this Agreement, and (iii) will not impair or otherwise adversely affect the liens, security interests and other rights of Lender under the Loan Documents not being released (or as to the parties to the Loan Documents and Properties or the other Collateral subject to the Loan Documents not being released);
(d)Borrower shall (A) partially prepay the Debt in accordance with Section 2.7(b) hereof, as applicable, in an amount equal to the greater of (x) 100% of the Net Sales Proceeds and (y) $250,000,000 for the release of the Puerto Rico Portfolio and (B) pay any applicable Interest Shortfall due hereunder in connection therewith, it being acknowledged and agreed that no Prepayment Premium shall be due and payable in connection with such PR Portfolio Release;
(e)As of the date of consummation of the sale of the Puerto Rico Portfolio, the Debt Yield with respect to the Plaza del Sol Property and all Individual Continental Properties shall be greater than the greater of (1) the Debt Yield of the Plaza del Sol Property and all Individual Continental Properties encumbered by the Security Instruments immediately prior to the consummation of the sale of the Puerto Rico Portfolio, and (2) the Minimum Debt Yield (provided, that, Borrower shall have the right to prepay the Loan in accordance with Section 2.7(b) hereof, as applicable, in an amount sufficient to satisfy the requirements of this clause (e));
(f)Notwithstanding anything to the contrary contained herein or in any other Loan Document, if the Loan is included in a REMIC Trust and the Loan-to-Value Ratio (expressed as a percentage) exceeds or would exceed 125% immediately after giving effect to the release of the Puerto Rico Portfolio, no release under any provision of this Agreement will be permitted unless the principal balance of the Loan is prepaid by an amount not less than the greater of (i) the Release Price or (ii) the least of the following amounts: (A) only if the Puerto Rico Portfolio is sold to an unrelated Person, the net proceeds of an arm’s length sale of the Puerto Rico Portfolio to an unrelated Person, (B) the fair market value of the Puerto Rico Portfolio at the time of the sale as determined in connection with determining the Loan-to-Value Ratio and (C) an amount such that the Loan-to-Value Ratio (as so determined by Lender in accordance with the provisions of this clause (f)) after giving effect to the sale of the Puerto Rico
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Portfolio is not greater than the Loan-to-Value Ratio immediately prior to such sale, unless Lender receives a REMIC Opinion with respect to such sale (provided, however, that any such prepayment shall be deemed a voluntary prepayment but shall not be subject to the Prepayment Premium or to any other premium or penalty);
(g)All conditions set forth in Section 2.14 of each Mezzanine Loan Agreement shall have been satisfied; and
(h)Borrower pay all of Lender’s reasonable out-of-pocket costs and expenses and the costs and expenses of the Rating Agencies in connection with the sale of the Puerto Rico Portfolio, including, without limitation, reasonable outside counsel fees.
Notwithstanding anything to the contrary contained in this Section 2.14, the parties hereto hereby acknowledge and agree that after the Securitization of the Loan (or any portion thereof or interest therein), with respect to any Lender approval or similar discretionary rights over any matters contained in this Section 2.14 (any such matter, an “PR Portfolio Release Approval Item”), such rights shall be construed such that Lender shall only be permitted to withhold its consent or approval with respect to any PR Portfolio Release Approval Item if the same fails to meet the Prudent Lender Standard.
Notwithstanding anything to the contrary contained in this Section 2.14, nothing in this Section 2.14 precludes Borrower from releasing the Plaza del Sol Property in accordance with the terms and conditions of Section 2.10 simultaneously with the release of the Puerto Rico Portfolio pursuant to the terms and conditions of this Section 2.14.
Section 2.15.Releases of the Outparcel. Lender agrees that, upon the request of Borrower, Borrower shall have the right to obtain the release of the Outparcel from the lien of the applicable Security Instrument thereon (and related Loan Documents) and the release of Borrower’s obligations under the Loan Documents with respect to the Outparcel (other than those expressly stated to survive) without any requirements to pay any portion of any Allocated Loan Amount, Release Price, prepayment fee, Prepayment Premium or otherwise (the release in accordance with this Section 2.15, the “Outparcel Release”) upon the satisfaction of each of the following conditions precedent:
(a)Borrower shall provide Lender with ten (10) Business Days prior written notice of the proposed Outparcel Release (the date of Lender’s receipt of such notice shall be referred to herein as the “Outparcel Release Notice Date”) (which notice may be amended or revoked upon prior written notice provided that Borrower reimburses Lender for all reasonable out-of-pocket costs and expenses actually incurred by Lender in reliance on such notice, including, without limitation, any Breakage Costs);
(b)No Event of Default shall have occurred and be continuing on either the Outparcel Release Notice Date or the date of consummation of the Outparcel Release, provided, however, if an Event of Default then exists which Event of Default is specific to the Outparcel, then the absence of such Event of Default shall not be a condition to the Outparcel Release of the Outparcel, if (but only to the extent that) the Outparcel Release would cure the applicable Event of Default and no other Events of Default shall be continuing after the Outparcel Release;
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(c)Borrower shall submit to Lender, not less than ten (10) days prior to the date of the Outparcel Release, a partial release of lien (and related Loan Documents) for the Outparcel for execution by Lender. Such release shall be in a form appropriate in the jurisdiction in which the Outparcel is located and shall contain standard provisions, if any, protecting the rights of Lender. In addition, Borrower shall provide an Officer’s Certificate certifying that such documentation (i) is in material compliance with all applicable Legal Requirements, (ii) will effect such release in accordance with the terms of this Agreement, and (iii) will not impair or otherwise adversely affect the liens, security interests and other rights of Lender under the Loan Documents not being released;
(d)Prior to the transfer and release of the Outparcel, (i) the applicable municipal authority exercising jurisdiction over the Outparcel shall have approved a lot-split ordinance or other applicable action under local law dividing the Outparcel from the remainder of the affected Individual Property, and a tax identification number that is separate from the tax identification number of the remaining affected Individual Property shall have been issued for the Outparcel (with the result that, upon the transfer and release of the Outparcel, no part of the remaining affected Individual Property shall be part of a tax lot or zoning lot which includes any portion of the Outparcel), (ii) an application has been made under local law to the appropriate Governmental Authority for approval of a lot-split ordinance or other application action and for a separate tax identification number for the Outparcel and the transferee and transferor Borrower shall have otherwise entered into a property tax allocation agreement which has materially the same economic effect of a tax lot subdivision or (iii) the Outparcel shall already constitute a separate tax lot for transfer purposes (as confirmed by a title company);
(e)All Legal Requirements applicable to the Outparcel in question and the remainder of the affected Individual Property necessary to accomplish the lot split shall have been fulfilled, and all necessary variances, if any, shall have been obtained, and Borrower shall have delivered to Lender either (i) letters or other evidence from the appropriate municipal authorities confirming such compliance with laws or (ii) a zoning report, legal opinion or other evidence confirming such compliance with laws, in each case in substance reasonably satisfactory to Lender;
(f)As a result of the lot split, the remaining Individual Property (after the release of the Outparcel from such Individual Property) shall comply in all material respects with all easements appurtenant and other Permitted Encumbrances thereto, will not be in violation of any Leases and then applicable Legal Requirements (that would be reasonably expected to result in a Material Adverse Effect or material default under such Leases) and all necessary variances, if any, shall have been obtained and evidence thereof has been delivered to Lender which in form and substance is appropriate for the jurisdiction in which the Outparcel is located;
(g)If reasonably necessary, appropriate reciprocal easement agreements for the benefit and burden of the remaining Individual Property and the Outparcel regarding the use of common facilities of such parcels, including, but not limited to, roadways, parking areas, utilities and community facilities, in a form and substance reasonably satisfactory to Lender and which easements will not materially adversely affect the remaining portion of the Outparcel, shall be declared and recorded, the remaining Individual Property and the Outparcel shall be in
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compliance with all applicable covenants under all easements and property agreements contained in the Permitted Encumbrances for the Individual Property;
(h)Borrower shall have delivered to Lender evidence reasonably satisfactory to Lender that the Single Purpose Entity nature and bankruptcy remoteness of Borrower following such release have not been adversely affected and are in accordance with the terms and provisions of this Agreement, provided that Borrower shall not be required to deliver a “bring-down” of the Non-Consolidation Opinion or a New Non-Consolidation Opinion;
(i)The Outparcel shall be released to an un-affiliated third party that is not an Affiliate of Borrower (and is not Site Centers or any of its Affiliates);
(j)Borrower shall have executed and delivered such other documents and instruments that are reasonably requested by Lender and typical for similar transactions;
(k)If, to the extent that any adjacent parcels to the Outparcel (and the remainder of the affected Individual Property) shall remain collateral for the Loan and the same were not separately described in the Survey delivered in connection with the closing of the Loan, Borrower shall have delivered a new metes and bounds description Survey for such remaining parcels that are collateral for the Loan;
(l)Borrower shall have delivered to Lender an endorsement or comfort letter with regard to Lender’s Title Insurance Policy (to the extent available in Ohio) solely with respect to the Individual Property being affected by the release of the Outparcel that (i) extends the date of the Title Insurance Policy to the effective date of the release, (ii) insures the priority of the Security Instrument is not affected by such release, and (iii) if applicable, insures the rights and benefits of any new or amended reciprocal easement agreement affecting the Individual Property;
(m)Intentionally Omitted;
(n)Notwithstanding anything to the contrary contained herein or in any other Loan Document, if the Loan is included in a REMIC Trust and the Loan-to-Value Ratio (expressed as a percentage) exceeds or would exceed 125% immediately after giving effect to the release of the Outparcel, no release under any provision of this Agreement will be permitted unless the principal balance of the Loan is prepaid by an amount not less than the least of the following amounts: (A) the fair market value of the Outparcel at the time of the Outparcel Release as determined in connection with determining the Loan-to-Value Ratio and (B) an amount such that the Loan-to-Value Ratio (as so determined by Lender in accordance with the provisions of this clause (n)) after giving effect to the release of the Outparcel is not greater than the Loan-to-Value Ratio immediately prior to the Outparcel Release, unless Lender receives a REMIC Opinion with respect to the Outparcel Release (provided, however, that any such prepayment shall be deemed a voluntary prepayment but shall not be subject to the Prepayment Premium or to any other premium or penalty); and
(o)Borrower pay all of Lender’s reasonable out-of-pocket costs and expenses and the costs and expenses of the Rating Agencies in connection with the Outparcel Release, including, without limitation, reasonable outside counsel fees.
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Notwithstanding anything to the contrary contained in this Section 2.15, the parties hereto hereby acknowledge and agree that after the Securitization of the Loan (or any portion thereof or interest therein), with respect to any Lender approval or similar discretionary rights over any matters contained in this Section 2.15 (any such matter, an “Outparcel Release Approval Item”), such rights shall be construed such that Lender shall only be permitted to withhold its consent or approval with respect to any Outparcel Release Approval Item if the same fails to meet the Prudent Lender Standard.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
Each of Additional Obligor and Borrower represents and warrants as of the Closing Date that:
Section 3.1.Legal Status and Authority. Each Borrower (a) is duly organized, validly existing and in good standing under the laws of its state of formation; (b) is duly qualified to transact business and is in good standing in the State; and (c) has all necessary approvals, governmental and otherwise, and full power and authority to own, operate and lease the applicable Individual Properties, except to the extent that same would reasonably be expected to cause a Material Adverse Effect. Borrower has full power, authority and legal right to mortgage, grant, bargain, sell, pledge, assign, warrant, transfer and convey the Properties pursuant to the terms hereof and to keep and observe all of the terms of this Agreement, the Note, the Security Instrument, the Pledge Agreement and the other Loan Documents on Borrower’s part to be performed. Additional Obligor (a) is duly organized, validly existing and in good standing under the laws of its state of formation; (b) is duly qualified to transact business and is in good standing in the State; and (c) has all necessary approvals, governmental and otherwise, and full power and authority to own, maintain and operate the assets it owns as of the Closing Date. Additional Obligor has full power, authority and legal right to grant, bargain, sell, pledge, assign, warrant, transfer and convey its assets pursuant to the terms hereof and to keep and observe all of the terms of this Agreement and the other Loan Documents on Additional Obligor’s part to be performed.
Section 3.2.Validity of Documents. (a) The execution, delivery and performance of this Agreement, the Note, the Security Instrument and the other Loan Documents by Borrower and the borrowing evidenced by the Note and this Agreement (i) are within the power and authority of such parties; (ii) have been authorized by all requisite organizational action of such parties; (iii) have received all necessary approvals and consents, corporate, governmental or otherwise; (iv) will not violate in any material respect, conflict with in any material respect, result in a material breach of or constitute (with notice or lapse of time, or both) a material default under any provision of law, any order or judgment of any court or Governmental Authority, any material license, certificate or other approval required to operate the Property or any portion thereof, any applicable organizational documents of Borrower, or any applicable indenture, agreement or other material instrument binding upon Borrower or the Properties, including, without limitation, the Management Agreement; (v) will not result in the creation or imposition of any lien, charge or encumbrance whatsoever upon any of its assets, except the lien and security interest created hereby and by the other Loan Documents; and (vi) will not require
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any material authorization or license from, or any filing with, any Governmental Authority (except for the recordation of each Security Instrument in appropriate land records in each applicable State and except for Uniform Commercial Code filings relating to the security interest created hereby), (b) this Agreement, the Note, the Security Instrument and the other Loan Documents have been duly executed and delivered by Borrower and (c) this Agreement, the Note, the Security Instrument and the other Loan Documents constitute the legal, valid and binding obligations of Borrower. The Loan Documents are not subject to any right of rescission, set-off, counterclaim or defense by Borrower, including the defense of usury, nor would the operation of any of the terms of the Loan Documents, or the exercise of any right thereunder, render the Loan Documents unenforceable (except as such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Creditors Rights Laws, and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law)). Neither Borrower nor any other Borrower Party has asserted any right of rescission, set-off, counterclaim or defense with respect to the Loan Documents.
Section 3.3.Litigation. There is no action, suit, proceeding or governmental investigation, in each case, judicial, administrative or otherwise (including any condemnation or similar proceeding), pending or, to Borrower’s knowledge, threatened in writing or contemplated against Borrower, Pledgor, SPE Component Entity, Additional Obligor or Sponsor or against or affecting the Property or any portion thereof other than those that, if adversely determined, are not reasonably likely to result in a Material Adverse Effect.
Section 3.4.Agreements. Borrower is not a party to any agreement or instrument or subject to any restriction that is reasonably likely to cause a Material Adverse Effect. Borrower is not in default in any material respect in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any agreement or instrument to which it is a party or by which Borrower or the Property (or any portion thereof) is bound which would result in a Material Adverse Effect. Borrower has no material financial obligation under any agreement or instrument to which Borrower is a party or by which Borrower or the Property (or any portion thereof) is otherwise bound, other than (a) obligations incurred in the ordinary course of the operation of the Property, (b) obligations under this Agreement, the Security Instrument, the Note and the other Loan Documents and (c) obligations recorded in Borrower’s financial statements provided to Lender in connection with the Loan. There is no agreement or instrument to which Borrower is a party or by which Borrower is bound that would require the subordination in right of payment of any of Borrower’s obligations hereunder or under the Note to an obligation owed to another party.
Section 3.5.Financial Condition.
(a)Borrower is solvent and Borrower has received reasonably equivalent value for the granting of the Security Instrument. No proceeding under Creditors Rights Laws with respect to any Borrower Party has been initiated.
(b)In the last ten (10) years, no (i) petition in bankruptcy has been filed by or against any Borrower Party and (ii) Borrower Party has ever made any general assignment for the benefit of creditors or taken advantage of any Creditors Rights Laws.
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(c)No Borrower Party is contemplating either the filing of a petition by it under any Creditors Rights Laws or the liquidation of its assets or property and Borrower has no knowledge of any Person contemplating the filing of any such petition against any Borrower Party.
Section 3.6.Disclosure. Borrower has disclosed to Lender all material facts and has not failed to disclose any material fact that could cause any representation or warranty made herein to be materially misleading.
Section 3.7.No Plan Assets. As of the date hereof and until the Debt is repaid in accordance with the applicable terms and conditions hereof, (a) none of Pledgor, Additional Obligor, any SPE Component Entity, or Borrower is or will be an “employee benefit plan,” as defined in Section 3(3) of ERISA, subject to Title I of ERISA, (b) none of Pledgor, Additional Obligor, any SPE Component Entity, or Borrower is or will be a “governmental plan” within the meaning of Section 3(32) of ERISA, (c) transactions by or with none of Pledgor, Additional Obligor, any SPE Component Entity, or Borrower are not and will not be subject to any state statute regulating investments of, or fiduciary obligations with respect to, governmental plans and (d) none of the assets of Pledgor, Additional Obligor, any SPE Component Entity, or Borrower constitutes or will constitute “plan assets” of one or more such plans within the meaning of 29 C.F.R. Section 2510.3‑101, as modified by Section 3(42) of ERISA. As of the date hereof, none of Pledgor, Additional Obligor, any SPE Component Entity, Borrower, or any member of a “controlled group of corporations” (within the meaning of Section 414 of the IRS Code), maintains, sponsors or contributes to a “defined benefit plan” (within the meaning of Section 3(35) of ERISA) or a “multiemployer pension plan” (within the meaning of Section 3(37)(A) of ERISA).
Section 3.8.Not a Foreign Person. Borrower, or Borrower’s regarded owner if Borrower is a disregarded entity, is not a “foreign person” within the meaning of § 1445(f)(3) of the IRS Code.
Section 3.9.Intentionally Omitted.
Section 3.10.Business Purposes. The Loan is solely for the business purpose of Borrower, and is not for personal, family, household, or agricultural purposes.
Section 3.11.Borrower’s Principal Place of Business. The principal place of business and chief executive office of each Borrower as of the date hereof is 0000 Xxxxxxxxxx Xxxxxxx, Xxxxxxxxx, Xxxx 00000. Borrower’s mailing address, as set forth in the opening paragraph hereof or as changed in accordance with the provisions hereof, is true and correct. The organizational identification number, if any, assigned to each Borrower by the state of its incorporation or organization is set forth on Schedule 1.1(a) and 1.1(b) attached hereto. The federal tax identification number used by each Borrower for tax purposes as of the Closing Date is set forth on Schedule 1.1(a) and 1.1(b) attached hereto. Borrower is not subject to back-up withholding taxes.
Section 3.12.Status of Property.
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(a)Except as otherwise set forth in any zoning report delivered to Lender in connection with the closing of the Loan (the “Zoning Report”), to Borrower’s knowledge, Borrower has obtained all material Permits required for the operation of the Plaza del Sol Property and the Individual Continental Properties, all of which are in full force and effect as of the date hereof and, to Borrower’s knowledge, not subject to revocation, suspension, forfeiture or modification.
(b)Except as otherwise set forth in any Zoning Report, Title Insurance Policy, tenant estoppel certificate or other third party report delivered to Lender in connection with the Loan and with respect to the Puerto Rico Portfolio Properties, as the same is qualified by the PR Property Representation Condition and as may be affected by the Prior Hurricane Damage, each Individual Property and the present use and occupancy thereof are, to Borrower’s knowledge, in compliance in all material respects with all applicable zoning ordinances, building codes, land use laws, Environmental Laws and other similar Legal Requirements.
(c)Each Individual Property is served by all utilities required for the current use thereof.
(d)To Borrower’s knowledge, the Plaza del Sol Property and each Individual Continental Property has either direct access to public roads or streets or access to public roads or streets by virtue of a perpetual easement or similar agreement inuring in favor of Borrower and any subsequent owners of the Plaza del Sol Property and the applicable Individual Continental Property, as applicable. To Borrower’s knowledge, except as may be qualified by the PR Property Representation Condition and as may be affected by the Prior Hurricane Damage, each Puerto Rico Portfolio Property has either direct access to public roads or streets or access to public roads or streets by virtue of a perpetual easement or similar agreement inuring in favor of Borrower and any subsequent owners of the applicable Puerto Rico Portfolio Property.
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(e)The Plaza del Sol Property and each Individual Continental Property is free from damage caused by fire or other casualty. Each Puerto Rico Portfolio Property is free from damage caused by fire or other casualty, other than the Prior Hurricane Damage and except as qualified by the PR Property Representation Condition. To Borrower’s knowledge, except as set forth in the tenant estoppels, property condition reports and environmental site assessments delivered in connection with the closing of the Loan and with respect to the Puerto Rico Portfolio Properties, as the same may be affected by the Prior Hurricane Damage and except as qualified by the PR Property Representation Condition, the Property, including, without limitation, all buildings, improvements, parking facilities, sidewalks, storm drainage systems, roofs, plumbing systems, HVAC systems, fire protection systems, electrical systems, equipment, elevators, exterior sidings and doors, landscaping, irrigation systems and all structural components, are in good condition, order and repair in all material respects, except as could not be reasonably expected to cause a Material Adverse Effect; with respect to each Puerto Rico Portfolio Property, as the same may be affected by the Prior Hurricane Damage and except as qualified by the PR Property Representation Condition, there exists no structural or other material defects or damages in the Property, whether latent or otherwise, except as could not be reasonably expected to cause a Material Adverse Effect, and with respect to the Puerto Rico Portfolio Properties, as the same may be affected by the Prior Hurricane Damage and except as qualified by the PR Property Representation Condition, Borrower has not received notice from any insurance company or bonding company of any defects or inadequacies in the Property, or any part thereof, which would adversely affect the insurability of the same or cause the imposition of extraordinary premiums or charges thereon or of any termination or threatened termination of any policy of insurance or bond.
(f)Except as set forth in any property condition report or tenant estoppel certificate delivered in connection with the closing of the Loan, with respect to the Puerto Rico Portfolio Properties, as the same may be affected by the Prior Hurricane Damage and except as qualified by the PR Property Representation Condition, all costs and expenses of any and all labor, materials, supplies and equipment used in the construction of the Improvements have been paid in full or, to the extent not yet due and payable, will be paid in full in the ordinary course of Borrower’s business in accordance with the terms and conditions of the Loan Documents. To Borrower’s knowledge, except as set forth in the Title Insurance Policy and with respect to any Puerto Rico Portfolio Property, any work performed to remedy any Prior Hurricane Damage at such Puerto Rico Portfolio Property and except as qualified by the PR Property Representation Condition, there are no mechanics’ or similar liens or claims which have been filed for work, labor or material (and, to Borrower’s knowledge, no rights are outstanding that under applicable Legal Requirements could give rise to any such liens) affecting the Property or the Collateral which are or may be prior to or equal to the lien of the Security Instrument or the Pledge Agreement. The parties hereby agree that any time the representations made in this clause (f) are re-made (or deemed to have been re-made) by Borrower, such representations by Borrower shall be deemed to have excepted any costs and expenses that are being contested in good faith in accordance with Section 4.16(b) hereof.
(g)Except for any Improvements or fixtures owned by Tenants under Leases, Borrower has paid in full for, and is the owner of, all furnishings, fixtures and equipment (other than Tenants’ property) used in connection with the operation of the Property, free and clear of any and all security interests, liens or encumbrances, except the lien and security interest created by this Agreement, the Note, the Security Instrument and the other Loan Documents and other security interests, liens and encumbrances permitted pursuant to this Agreement.
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(h)To Borrower’s knowledge and except as set forth in any environmental condition report and/or property condition report delivered to Lender in connection with the closing of the Loan and with respect to the Puerto Rico Portfolio Properties, as the same may be affected by the Prior Hurricane Damage and except as qualified by the PR Property Representation Condition, all liquid and solid waste disposal, septic and sewer systems located on the Property are in a good and safe condition and repair and in compliance with all Legal Requirements.
(i)Except as expressly disclosed on the Survey and except as set forth on Schedule 3.12(i), to Borrower’s knowledge, no portion of the Improvements on the Plaza del Sol Property or any Individual Continental Property is located in an area identified by the Federal Emergency Management Agency or any successor thereto as an area having special flood hazards pursuant to the Flood Insurance Acts. Except as expressly disclosed on the Survey, to Borrower’s knowledge, no part of the Plaza del Sol Property or any Individual Continental Property consists of or is classified as wetlands, tidelands or swamp and overflow lands.
(j)To Borrower’s knowledge, except as disclosed on the Survey or in the Title Insurance Policy and/or as set forth on Schedule 3.12(j), all the Improvements on the Plaza del Sol Property and any Individual Continental Property lie within the boundaries of the Land and any building restriction lines applicable to the Land. To Borrower’s knowledge, except as disclosed on the Survey or in the Title Insurance Policy and/or as set forth on Schedule 3.12(j), the Improvements on any Puerto Rico Portfolio Property lie within the boundaries of the PR Land and any building restriction lines applicable to the PR Land.
(k)To Borrower’s knowledge and except as set forth in the Title Insurance Policies except as set forth on Schedule 3.12(k), there are no pending or proposed special or other assessments for public improvements or otherwise affecting any Individual Property, nor are there any contemplated improvements to any Individual Property that may result in such special or other assessments.
(l)Except with respect to any Prior Hurricane Damage or PR Restoration, and except as qualified by the PR Property Representation Condition and except as set forth on Schedule 3.12(l), Borrower has not (i) made, ordered or contracted for any construction, repairs, alterations or improvements to be made on or to the Property which have not been completed and paid for in full or, to the extent not yet due and payable, will not be paid in full in the ordinary course in accordance with the terms and conditions of the Loan Documents, (ii) ordered materials for any such construction, repairs, alterations or improvements which have not been paid for in full or, to the extent not yet due and payable, will not be paid in full in the ordinary course in accordance with the terms and conditions of the Loan Documents or (iii) attached any fixtures to the Property which have not been paid for in full or, to the extent not yet due and payable, will not be paid in full in the ordinary course of Borrower’s business in accordance with the terms and conditions of the Loan Documents. Except for the Unfunded Obligations, Environmental Work, the PR Restoration work, and the additional environmental work set forth on Schedule 4.25 hereof and Immediate Repairs, to Borrower’s knowledge and except as qualified by the PR Property Representation Condition and except in connection with the Prior Hurricane Damage, there is no such construction, repairs, alterations or improvements ongoing at the Property that have not been paid for as of the Closing Date. To Borrower’s knowledge and except as qualified by the PR Property Representation Condition and except in connection with the Prior Hurricane Damage, there are no outstanding or disputed claims for any Work Charges
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and there are no outstanding liens or security interests in connection with any Work Charges that are not covered by the Title Insurance Policy.
(m)The property address of each unit of each Individual Property is set forth on Schedule 1.1(a) and 1.1(b) attached hereto.
(n)Borrower has no direct employees. All other personnel employed at or in connection with the Property are the direct employees of Manager or its Affiliates (other than Borrower).
(o)All PR Restoration work completed prior to the Closing Date was completed in accordance with all applicable Legal Requirements.
Section 3.13.Financial Information. Except as set forth on Schedule 3.13, all financial data, including, without limitation, the balance sheets, statements of cash flow, statements of income and operating expense and rent rolls, that have been delivered to Lender in respect of Borrower, Pledgor, Sponsor, Additional Obligor, Collateral and/or the Property (a) are true, complete and correct in all material respects, (b) accurately represent the financial condition of Borrower, Pledgor, Sponsor, Additional Obligor, the Collateral or the Property, as applicable, as of the date of such reports, and (c) to the extent prepared or audited by an independent certified public accounting firm, to Borrower’s knowledge, have been prepared in accordance with the Approved Accounting Method throughout the periods covered, except as disclosed therein. Borrower does not have any contingent liabilities, liabilities for taxes, unusual forward or long-term commitments or unrealized or anticipated losses from any unfavorable commitments that are known to Borrower and reasonably likely to have a Material Adverse Effect, except as referred to or reflected in said financial statements. Since the date of such financial statements, there has been no materially adverse change in the financial condition, operations or business of Borrower from that set forth in said financial statements.
Section 3.14.Condemnation. Except as set forth on Schedule 3.14 attached hereto, no Condemnation or other proceeding has been commenced, is pending or, to Borrower’s knowledge, is threatened in writing with respect to all or any portion of any Individual Property or for the relocation of the access to any Individual Property.
Section 3.15.Separate Lots. Except with respect to the Combined Individual Property and as set forth on Schedule 3.15 hereto, each Individual Property is assessed for real estate tax purposes as one or more wholly independent tax lot or lots, separate from any adjoining land or improvements not constituting a part of such lot or lots, and no other land or improvements is assessed and taxed together with any Individual Property or any portion thereof.
Section 3.16.Insurance. Borrower has obtained and has delivered to Lender certified copies of all Policies (or such other evidence reasonably acceptable to Lender) reflecting the insurance coverages, amounts and other requirements set forth in this Agreement. Except as qualified by the PR Property Representation Condition and except in connection with the Prior Hurricane Damage, there are no present claims of any material nature under any of the Policies that if adversely determined would have a Material Adverse Effect, and to Borrower’s
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knowledge, no Person, including Borrower, has done, by act or omission, anything which would impair the coverage of any of the Policies.
Section 3.17.Use of Property. Each Individual Property is used primarily as a retail shopping center, and other appurtenant and related uses.
Section 3.18.Leases and Rent Roll. Except as disclosed in the rent roll for each Individual Property delivered to, certified to and approved by Lender in connection with the closing of the Loan (the “Rent Roll”) and, with respect to each Puerto Rico Portfolio Property, to Borrower’s knowledge and except as qualified by the PR Property Representation Condition and except in connection with the Prior Hurricane Damage (other than with respect to the representations in clauses (a) and (t) below which shall not be qualified), (a) Borrower is the sole owner of the entire lessor’s interest in the Leases; (b) the Leases at the Plaza del Sol Property and each Individual Continental Property are valid and enforceable and in full force and effect; (c) all of the Leases are arms-length agreements with bona fide, independent third parties; (d) except as set forth on Schedule 3.18(d) and Schedule 3.18(e), to Borrower’s knowledge and except as set forth in tenant estoppels delivered in connection with the closing of the Loan, no party under any Lease is in monetary (which, for purposes of this Section 3.18(d) shall mean owes more than $20,000 in rent and other charges that are delinquent sixty (60) days or more) or material non-monetary (which, for purposes of this Section 3.18(d) shall mean has failed to perform within sixty (60) days of the relevant due date) default; (e) to Borrower’s knowledge and except as set forth on Schedule 3.18(e), no Tenant at the Plaza del Sol Property or any Individual Continental Property owes more than $20,000 in rent and other charges that are delinquent sixty (60) days or more beyond the applicable due date set forth in the related Lease; (f) to the extent any material monetary alterations, modifications and amendments to the Leases affect the rent and/or the lease term of the Leases for the Plaza del Sol Property and each Individual Continental Property, such rent amounts and term modifications are reflected in Rent Roll; (g) none of the Rents reserved in the Leases have been assigned or otherwise pledged or hypothecated, except pursuant to the Loan Documents; (h) none of the Rents have been collected for more than one (1) month in advance (except a Security Deposit shall not be deemed rent collected in advance); (i) except as set forth on Schedule 3.18(i), the premises demised under the Leases at the Plaza del Sol Property and each Individual Continental Property have been completed, all improvements, repairs, alterations or other work required to be furnished on the part of Borrower under the Leases at the Plaza del Sol Property and each Individual Continental Property have been completed in all material respects, the Tenants under the Leases at the Plaza del Sol Property and each Individual Continental Property have accepted the premises demised thereunder and have taken possession of the same on a rent-paying basis and any payments, credits or abatements required to be given by Borrower to the Tenants under the Leases at the Plaza del Sol Property and each Individual Continental Property have been made in full or have been reserved for in the Unfunded Obligations Reserve Account; (j) to Borrower’s knowledge, there exist no material offsets or defenses to the payment of any portion of the Rents at the Plaza del Sol Property or any Individual Continental Property and Borrower has no monetary obligation to any Tenant at the Plaza del Sol Property or any Individual Continental Property under any Lease, other than disputes with Tenants with respect to common area maintenance charges, ordinary course reimbursable items in the ordinary course of Borrower’s business and immaterial rent disputes in the ordinary course of business; (k) Borrower has received no written notice from any Tenant challenging the validity or enforceability of any Lease at the Plaza del Sol Property or any
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Individual Continental Property; (l) except as set forth on Schedule 3.18(l), there are no agreements with the Tenants under the Leases at the Plaza del Sol Property or any Individual Continental Property other than expressly set forth in each Lease with respect to the use and occupancy of such Tenant’s premises (as disclosed on the Schedule of Leases provided to Lender by Borrower); (m) reserved; (n) except as set forth on Schedule 3.18(n) attached hereto, no Lease contains an option to purchase, right of first refusal to purchase, right of first refusal with respect to the Property, or any other similar provision; (o) except as set forth on Schedule 3.18(o) and/or the Title Insurance Policies, no Person has any possessory interest in, or right to occupy, the Property except under and pursuant to a Lease (or any subleases or assignments of such Lease by a Tenant); (p) all Security Deposits relating to the Leases are reflected on Schedule 3.18(p) attached hereto and have been collected by Borrower; (q) except as set forth on Schedule 3.18(q), no brokerage commissions or finders fees are due and payable regarding any Lease; (r) except as set forth on Schedule 3.18(r), to Borrower’s knowledge, there are no actions or proceedings (voluntary or otherwise) pending against any Tenants or guarantors under Leases, in each case, under bankruptcy or similar insolvency laws or regulations; (s) except as set forth on Schedule 3.18(s), Borrower has not received written notice of any event giving any Tenant under a Major Lease (for purposes of this clause (s), Major Lease shall refer to any Lease meeting the requirements set forth in the definition of Major Lease at any Individual Property) with the right to cease operations at its leased premises (i.e., “go dark”) and/or any event under a Major Lease (for purposes of this clause (s), Major Lease shall refer to any Lease meeting the requirements set forth in the definition of Major Lease at any Individual Property) that would cause a co-tenancy violation under any Lease and (t) except as set forth on Schedule 3.18(t), no Tenant is entitled to free rent under its respective Lease at the Plaza del Sol Property or any Individual Continental Property.
Section 3.19.Filing and Recording Taxes. All mortgage, mortgage recording, stamp, intangible or other similar tax required to be paid by Borrower, Additional Obligor or Pledgor, as applicable, under applicable Legal Requirements currently in effect in connection with the execution, delivery, recordation, filing, registration, perfection or enforcement of any of this Agreement, the Security Instrument, the Note and the other Loan Documents, including, without limitation, the Security Instrument and the Pledge Agreement, have been paid or will be paid, and under current Legal Requirements, the Security Instrument and the other Loan Documents are enforceable in accordance with their terms by Lender (or any subsequent holder thereof), except as such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Creditors Rights Laws, and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).
Section 3.20.Management Agreement. The Management Agreement is in full force and effect and there is no material default thereunder by any party thereto and, to Borrower’s knowledge, no event has occurred that, with the passage of time and/or the giving of notice would constitute a material default thereunder. As of the date hereof, no management fees under the Management Agreement are delinquent.
Section 3.21.Illegal Activity/Forfeiture.
(a)No portion of the Property has been or will be purchased, improved, equipped or furnished with proceeds of any illegal activity by Borrower and to Borrower’s
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knowledge, there are no illegal activities or activities relating to controlled substances at the Property.
(b)There has not been committed by Borrower or, to Borrower’s knowledge, any other Person in occupancy of or involved with the operation or use of the Property any act or omission affording the federal government or any state or local government the right of forfeiture as against any Individual Property or any part thereof or any monies paid in performance of Borrower’s obligations under this Agreement, the Note, the Security Instrument or the other Loan Documents.
Section 3.22.Taxes. To the extent required by applicable law, Borrower has filed (or has obtained effective extensions for filing) all federal, state, county, municipal, and city income, personal property and other tax returns required to have been filed by it and has paid all taxes and related liabilities which have become due pursuant to such returns or pursuant to any assessments received by it, except as are being contested in good faith. To Borrower’s knowledge, there is no assessment pending in respect of any such taxes and related liabilities for prior years.
Section 3.23.Permitted Encumbrances. None of the Permitted Encumbrances, individually or in the aggregate, materially interferes with the benefits of the security intended to be provided by this Agreement, the Security Instrument, the Note and the other Loan Documents materially and adversely affects the value or marketability of the Property (or any portion thereof), materially impairs the use or the operation of the Property for its intended use or impairs Borrower’s ability to pay its obligations in a timely manner.
Section 3.24.Intentionally Omitted.
Section 3.25.Intentionally Omitted.
Section 3.26.Federal Reserve Regulations. No part of the proceeds of the Loan will be used for the purpose of purchasing or acquiring any “margin stock” within the meaning of Regulation U of the Board of Governors of the Federal Reserve System or for any other purpose which would be inconsistent with such Regulation U or any other Regulations of such Board of Governors, or for any purposes prohibited by Legal Requirements or by the terms and conditions of this Agreement, the Security Instrument, the Note or the other Loan Documents.
Section 3.27.Investment Company Act. Borrower is not (a) an “investment company” or a company “controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended; (b) a “holding company” or a “subsidiary company” of a “holding company” or an “affiliate” of either a “holding company” or a “subsidiary company” within the meaning of the Public Utility Holding Company Act of 1935, as amended; or (c) subject to any other federal or state law or regulation which purports to restrict or regulate its ability to borrow money.
Section 3.28.Fraudulent Conveyance. Subject to the terms and conditions of Section 17.19 hereof, Borrower (a) has not entered into the Loan or any Loan Document with the actual intent to hinder, delay, or defraud any creditor and (b) received reasonably equivalent value in exchange for its obligations under the Loan Documents. After giving effect to the Loan, the fair
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saleable value of Borrower’s assets exceeds and will, immediately following the execution and delivery of the Loan Documents, exceed Borrower’s total liabilities, including, without limitation, subordinated, unliquidated, disputed or contingent liabilities. The fair saleable value of Borrower’s assets is and will, immediately following the execution and delivery of the Loan Documents, be greater than Borrower’s probable liabilities, including the maximum amount of its contingent liabilities or its debts as such debts become absolute and matured. Borrower’s assets do not and, immediately following the execution and delivery of the Loan Documents will not, constitute unreasonably small capital to carry out its business as conducted or as proposed to be conducted. Borrower does not intend to, and does not believe that it will, incur debts and liabilities (including, without limitation, contingent liabilities and other commitments) beyond its ability to pay such debts as they mature (taking into account the timing and amounts to be payable on or in respect of obligations of Borrower).
Section 3.29.Embargoed Person. As of the date hereof and at all times throughout the term of the Loan, including after giving effect to any transfers of interests permitted pursuant to the Loan Documents, (a) none of the funds or other assets of any Borrower Party constitute (or will constitute) property of, or are (or will be) beneficially owned, directly or indirectly, by any Person or government that is the subject of economic sanctions under U.S. law, including but not limited to, the International Emergency Economic Powers Act, 50 U.S.C. §§ 1701 et seq., the Trading with the Enemy Act, 50 U.S.C. App. 1 et seq., and any Executive Orders or regulations promulgated thereunder with the result that transactions involving or the investment in any such Borrower Party (whether directly or indirectly) is prohibited by applicable law or the Loan made by Lender is in violation of applicable law (“Embargoed Person”); (b) no Embargoed Person has (or will have) any interest of any nature whatsoever in any Borrower Party, with the result that transactions involving or the investment in any such Borrower Party (whether directly or indirectly), is prohibited by applicable law or the Loan is in violation of applicable law; and (c) none of the funds of any Borrower Party have been (or will be) derived from any unlawful activity with the result that transactions involving or the investment in any such Borrower Party (whether directly or indirectly), is prohibited by applicable law or the Loan is in violation of applicable law. Any violation of the foregoing shall, at Lender’s option, constitute an Event of Default hereunder.
Section 3.30.Anti-Money Laundering and Economic Sanctions. Borrower hereby represents and warrants that each Borrower Party, each Person that Controls each Borrower Party and, to Borrower’s knowledge, each and every other Person Affiliated with any Borrower Party and their respective directors, officers, employees or agents and any Person that has an economic interest in any Borrower Party, in each case, has not, and at all times throughout the term of the Loan, including after giving effect to any transfers of interests permitted pursuant to the Loan Documents, shall not: (i) itself be (or have been), be (or have been) owned or controlled by, or act for or on behalf of a Person or government that is the subject of, in each case, economic sanctions administered or enforced by the Office of Foreign Assets Control (“OFAC”) of the Department of the Treasury, the Department of State, or other relevant sanctions authority (“Sanctions”); (ii) fail to be (or have been) in full compliance with the requirements of the Patriot Act or other applicable anti-money laundering laws and regulations and all Sanctions; (iii) fail to operate (or have operated) under policies, procedures and practices, if any, that are (A) in compliance with applicable anti-money laundering laws and regulations and Sanctions and (B) available to Lender for Lender’s review and inspection during normal business hours and
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upon reasonable prior notice; (iv) be (or have been) in receipt of any notice from OFAC, the Secretary of State or the Attorney General of the United States or any other department, agency or office of the United States, in each case, claiming a violation or possible violation of applicable anti-money laundering laws and regulations and/or Sanctions; (v) be (or have been) the subject of Sanctions, including those listed as a Specially Designated National or as a “blocked” Person on any lists issued by OFAC and those owned or controlled by or acting for or on behalf of such Specially Designated National or “blocked” Person; (vi) be (or have been) a Person who has been determined by competent authority to be subject to any of the prohibitions contained in the Patriot Act; or (vii) be (or have been) owned or controlled by or be (or have been) acting for or on behalf of, in each case, any Person who has been determined to be subject to the prohibitions contained in the Patriot Act. Borrower covenants and agrees that in the event Borrower receives any notice that any Borrower Party (or any of their respective beneficial owners or Affiliates) became the subject of Sanctions or is indicted, arraigned, or custodially detained on charges involving Sanctions, money laundering or predicate crimes to money laundering, Borrower shall immediately notify Lender. It shall be an Event of Default hereunder if any Borrower Party or any other party to any Loan Document becomes the subject of Sanctions or is indicted, arraigned or custodially detained on charges involving Sanctions, money laundering or predicate crimes to money laundering. All capitalized words and phrases and all defined terms used in the Patriot Act are incorporated into this Section. As used herein, “Patriot Act” shall mean collectively (i) the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act (USA PATRIOT ACT) of 2001, as the same was restored and amended by Uniting and Strengthening America by Fulfilling Rights and Ensuring Effective Discipline Over Monitoring Act (USA FREEDOM Act) of 2015, (ii) all statutes, orders, rules and regulations of the United States government and its various executive departments, agencies and offices related to applicable anti-money laundering laws, rules and regulations and (iii) any amendment, extension, replacement or other modification of any of the foregoing from time to time and any corresponding provisions of future laws.
Section 3.31.Organizational Chart. The organizational chart attached as Schedule 3.31 hereto (the “Organizational Chart”), relating to Borrower, Pledgor, Additional Obligor, SPE Component Entity and certain Affiliates and other parties, is true, complete and correct on and as of the date hereof.
Section 3.32.Bank Holding Company. Borrower is not a “bank holding company” or a direct or indirect subsidiary of a “bank holding company” as defined in the Bank Holding Company Act of 1956, as amended, and Regulation Y thereunder of the Board of Governors of the Federal Reserve System.
Section 3.33.Intentionally Omitted.
Section 3.34.Property Document Representations. With respect to each Property Document, Borrower hereby represents that (a) to Borrower’s knowledge, each Property Document is in full force and effect and has not been amended, restated, replaced or otherwise modified (except, in each case, as expressly set forth herein or as disclosed on the applicable Title Insurance Policy), (b) except as set forth on Schedule 3.34, there are no material defaults under any Property Document by any party thereto and, to Borrower’s knowledge, no event has occurred which, but for the passage of time, the giving of notice, or both, would constitute a material default under any Property Document, in all cases, which would have a Material
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Adverse Effect, (c) except as set forth on Schedule 3.34, to Borrower’s knowledge, all rents, additional rents and other sums due and payable by Borrower under the Property Documents have been paid in full, except those that are being contested in good faith in accordance with the terms and conditions of this Agreement and except those which would have a Material Adverse Effect if not paid, and (d) to Borrower’s knowledge, no party to any Property Document has commenced any action or given or received any notice for the purpose of terminating any Property Document.
Section 3.35.No Change in Facts or Circumstances; Disclosure. Except as qualified by the PR Property Representation Condition and except as affected by the Prior Hurricane Damage, all information submitted by (or on behalf of) Borrower, Pledgor, Additional Obligor or Sponsor to Lender and in all financial statements, rent rolls, reports, certificates and other documents submitted in connection with the Loan or in satisfaction of the terms thereof and all statements of fact made by Borrower and Additional Obligor in this Agreement or in the other Loan Documents, were accurate, complete and correct in all material respects as of the date provided. To Borrower’s knowledge, there has been no material adverse change in any condition, fact, circumstance or event that would make any such information inaccurate, incomplete or otherwise misleading in any material respect or that otherwise have a Material Adverse Effect. Each of Additional Obligor and Borrower has disclosed to Lender all material facts and has not failed to disclose any material fact that could cause any representation or warranty made herein to be materially misleading.
Section 3.36.Condominium Representations. Except as set forth on Schedule 3.36:
(a)To Borrower’s actual knowledge, the Condominium has been legally and validly created pursuant to all Legal Requirements and the Condominium Documents.
(b)To Borrower’s actual knowledge, Borrower has delivered to Lender (or the applicable Title Insurance Policy discloses) a true, complete and correct copy of each of the Condominium Documents, together with true, complete and correct copies of all amendments and modifications thereto, and none of the Condominium Documents has been otherwise modified, amended or supplemented.
(c)There currently exists no default or event of default under the Condominium Documents by Borrower or, to Borrower’s knowledge, by any other party thereto. Except pursuant to the Loan Documents, Borrower’s interest therein has not been assigned. There are no fees, dues, charges and assessments, whether annual, monthly, regular, special, extraordinary or otherwise, including, any “Common Expenses” (as such term is defined in the Condominium Documents) (collectively, the “Common Charges”) charged to, due or otherwise payable by Borrower or any other Person under the Condominium Documents. The Condominium Board has not established a working capital or any other similar type of reserve. To Borrower’s knowledge, there are no judgments, suits or claims pending, filed or threatened against the Condominium Board and there are no set-offs, claims, counterclaims or defenses being asserted or, after giving the requisite notice, if any, required under the Condominium Documents, capable of being asserted, for the enforcement of the obligations of any party under the Condominium Documents. The Condominium Board has the sole power and authority to act on behalf of, and bind, the Condominium.
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(d)Neither the Condominium Board nor any other Person has any right of first refusal or option to purchase the Individual Property subject to the Condominium Documents.
(e)The Condominium Board is not active and there are no members of the Condominium Board appointed by Borrower or any other Person.
(f)With respect to the Condominium, if the Condominium Board was active, the Condominium Board and Condominium are controlled by members thereof appointed by Borrower.
(g)To the knowledge of Borrower, neither the Condominium Board nor the Condominium are party to any loan, credit agreement or other arrangement for any extension of credit, whether funded or to be funded.
(h)There are no conditions of the Condominium Documents which are required to be satisfied or approvals required to be given in connection with the making of the Loan.
Section 3.37.Ground Lease.
(a)The Ground Lease or a memorandum of such Ground Lease has been duly recorded. The Ground Lease permits the interest of Ground Lease Borrower to be encumbered by a mortgage or the Ground Lessor has approved and consented to the encumbrance of the Ground Leased Property by the applicable Security Instrument. There have not been amendments or modifications to the terms of the Ground Lease since recordation of the Ground Lease (or a memorandum thereof), with the exception of written instruments disclosed to Lender in this Agreement.
(b)The Ground Lease may not be terminated, surrendered or amended without the prior written consent of Lender; provided that the Ground Lessor shall not be prevented from exercising its remedies in accordance with the Ground Lease if the obligations of Borrower under the Ground Lease are not performed as provided in the Ground Lease.
(c)Except for the Permitted Encumbrances and other encumbrances of record, Borrower’s interest in the Ground Lease is not subject to any liens or encumbrances superior to, or of equal priority with, the applicable Security Instrument other than the Ground Lessor’s related fee interest.
(d)As of the date hereof, the Ground Lease is in full force and effect and no default has occurred on the part of the Borrower under the Ground Lease, nor to Borrower’s knowledge has any default occurred by the Ground Lessor under the Ground Lease (except in each case, any such default that has been previously cured). To Borrower’s knowledge, there is no existing condition which, but for the passage of time or the giving of notice, could result in (i) a default by the Borrower under the terms of the Ground Lease or (ii) to Borrower’s knowledge, a default by Ground Lessor under the terms of the Ground Lease.
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(e)Under the terms of the Ground Lease and the Loan Documents, taken together, any related insurance and condemnation proceeds that are paid or awarded to Borrower with respect to the leasehold interest will be applied pursuant to the terms of the Loan Documents.
(f)The Ground Lease requires the Ground Lessor to give notice of any default by Borrower to Lender prior to exercising its remedies thereunder.
(g)Lender is permitted the opportunity to cure any default under the Ground Lease, which is curable after the receipt of notice of the default before the Ground Lessor thereunder may terminate the Ground Lease.
(h)The Ground Lease has a term (including any unexercised option periods and automatic renewal periods) which extends not less than twenty (20) years beyond the Maturity Date.
(i)The Ground Lease requires the Ground Lessor to enter into a new lease upon termination (prior to expiration of the term thereof) of the Ground Lease for any reason including rejection or disaffirmation of the Ground Lease in a bankruptcy proceeding.
(j)The Ground Lease does not impose any restrictions on subleasing that would reasonably be expected to have a Material Adverse Effect on the operation of the Borrower’s business as currently operated, provided the tenant under the Ground Lease indemnifies Ground Lessor for any losses that may occur as a result of such sublease.
Section 3.38.Additional Obligor Representations.
(a)(a) The execution, delivery and performance of this Agreement and the other Loan Documents by Additional Obligor (i) are within the power and authority of such party; (ii) have been authorized by all requisite organizational action of such party; (iii) have received all necessary approvals and consents, corporate, governmental or otherwise; (iv) will not violate in any material respect, conflict with in any material respect, result in a material breach of or constitute (with notice or lapse of time, or both) a material default under any provision of law, any order or judgment of any court or Governmental Authority, any material license, certificate or other approval required to own and maintain the assets of Additional Obligor, any applicable organizational documents of Additional Obligor, or any applicable indenture, agreement or other material instrument binding upon Additional Obligor; (v) will not result in the creation or imposition of any lien, charge or encumbrance whatsoever upon any of its assets, except the lien and security interest created hereby and by the other Loan Documents; and (vi) will not require any material authorization or license from, or any filing with, any Governmental Authority (except for Uniform Commercial Code filings relating to the security interest created hereby), (b) this Agreement and the other Loan Documents to which it is a party have been duly executed and delivered by Additional Obligor and (c) this Agreement and the other Loan Documents to which it is a party constitute the legal, valid and binding obligations of Additional Obligor. The Loan Documents are not subject to any right of rescission, set-off, counterclaim or defense by Additional Obligor, including the defense of usury, nor would the operation of any of the terms of the Loan Documents, or the exercise of any right thereunder,
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render the Loan Documents unenforceable (except as such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Creditors Rights Laws, and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law)).
(b)Additional Obligor is not a party to any agreement or instrument or subject to any restriction that is reasonably likely to cause a Material Adverse Effect. Additional Obligor is not in default in any material respect in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any agreement or instrument to which it is a party or by which Additional Obligor or its assets (or any portion thereof) is bound which would result in a Material Adverse Effect. Additional Obligor has no material financial obligation under any agreement or instrument to which Additional Obligor is a party or by which Additional Obligor or its assets (or any portion thereof) is otherwise bound, other than obligations under this Agreement and the other Loan Documents. There is no agreement or instrument to which Additional Obligor is a party or by which Additional Obligor is bound that would require the subordination in right of payment of any of Additional Obligor’s obligations hereunder or any other Loan Document to which it is a party to an obligation owed to another party.
(c)Additional Obligor has disclosed to Lender all material facts and has not failed to disclose any material fact that could cause any representation or warranty made herein to be materially misleading.
(d)The principal place of business and chief executive office of Additional Obligor as of the date hereof is 0000 Xxxxxxxxxx Xxxxxxx, Xxxxxxxxx, Xxxx 00000. Additional Obligor’s mailing address, as set forth in the opening paragraph hereof or as changed in accordance with the provisions hereof, is true and correct. The organizational identification number, if any, assigned to Additional Obligor by the state of its incorporation or organization is 20180806298. The federal tax identification number of Additional Obligor is 00-0000000. Additional Obligor is not subject to back-up withholding taxes.
Section 3.39.Survival. Each of Additional Obligor and Borrower agrees that, unless expressly provided otherwise, all of the representations and warranties of Additional Obligor and/or Borrower set forth in this Article 3 and elsewhere in this Agreement and the other Loan Documents shall survive for so long as any portion of the Debt remains owing to Lender. All representations, warranties, covenants and agreements made in this Agreement and in the other Loan Documents shall be deemed to have been relied upon by Lender notwithstanding any investigation heretofore or hereafter made by Lender or on its behalf. On the date of any Securitization, on not less than five (5) Business Days’ prior written notice, each of Additional Obligor and Borrower shall deliver to Lender a certification (x) confirming that all of the representations contained in this Agreement are true and correct in all material respects as of the date of such Securitization subject, as applicable, to the PR Property Representation Condition, or (y) otherwise specifying any changes in or qualifications to such representations as of such date as may be necessary to make such representations consistent with the facts as they exist on such date.
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From the date hereof and until payment and performance in full of all obligations of Borrower under this Agreement, the Security Instrument, the Note and the other Loan Documents or the earlier release of the lien of the Security Instrument (and all related obligations) in accordance with the terms of this Agreement, the Security Instrument, the Note and the other Loan Documents, each of Additional Obligor and Borrower hereby covenants and agrees with Lender that:
Section 4.1.Existence. Each Borrower and Additional Obligor will continuously maintain (a) its existence and shall not dissolve or permit its dissolution (or divide or permit its Division), (b) its rights to do business in the State and (c) its franchises and trade names, if any.
Section 4.2.Legal Requirements.
(a)Except in connection with the Prior Hurricane Damage and prior to completion of the PR Restoration (which, for the avoidance of doubt, shall be conducted in accordance with Section 4.29 hereof), Borrower shall promptly comply in all material respects and shall cause the Property to comply in all material respects with all Legal Requirements affecting the Property or the use thereof (which such covenant shall be deemed to (i) include Environmental Laws and (ii) require Borrower to keep all Permits in full force and effect, subject to Section 4.2(d) below).
(b)Intentionally Omitted.
(c)Except in connection with the Prior Hurricane Damage, Borrower shall give prompt notice to Lender of the receipt by Borrower of any notice related to a material violation of any Legal Requirements and of the commencement of any material proceedings or investigations which relate to compliance with Legal Requirements.
(d)Except in connection with the Prior Hurricane Damage, after prior written notice to Lender, Borrower, at its own expense, may contest by appropriate legal proceeding, promptly initiated and conducted in good faith and with due diligence, the validity of any Legal Requirement, the applicability of any Legal Requirement to Borrower or any Individual Property or any alleged violation of any Legal Requirement, provided that (i) no Event of Default has occurred and remains uncured; (ii) such proceeding shall be permitted under and be conducted in accordance with the provisions of any instrument to which Borrower is subject and shall not constitute a default thereunder and such proceeding shall be permitted by and conducted in accordance with all applicable Legal Requirements; (iii) neither the applicable Individual Property nor any part thereof or interest therein will be in imminent danger of being sold, forfeited, terminated, cancelled or lost; (iv) Borrower shall promptly upon final determination thereof comply with any such Legal Requirement determined to be valid or applicable or cure any violation of any Legal Requirement; (v) such proceeding shall suspend the enforcement of the contested Legal Requirement against Borrower or the applicable Individual Property; and (vi) to the extent that the aggregate amount reasonably determined to cause Borrower’s compliance
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with such Legal Requirement with respect to any Individual Property exceeds $500,000, Borrower shall furnish such security as may be required in the proceeding, or as may be reasonably requested by Lender, to insure compliance with such Legal Requirement, together with all interest and penalties payable in connection therewith. Lender may apply any such security or part thereof, as necessary to cause compliance with such Legal Requirement at any time when, in the judgment of Lender, the validity, applicability or violation of such Legal Requirement is finally established or the applicable Individual Property (or any part thereof or interest therein) shall be in danger of being sold, forfeited, terminated, cancelled or lost. This Section 4.2 shall not apply to any Legal Requirement with respect to taxes.
Section 4.3.Maintenance and Use of Property. Except in connection with the Prior Hurricane Damage and the PR Restoration, Borrower shall cause the Property to be maintained in a good and safe condition and repair in all material respects, provided that Borrower shall take all commercially reasonable actions Borrower deems necessary in the exercise of its commercially reasonable business judgment to ensure that all Properties and Persons are protected against any accident, injury to or death of persons or loss of or damage to property occurring in, on or about the Property or any part thereof or on the adjoining sidewalks, curbs, adjacent property or adjacent parking areas, streets or ways. Except in connection with the Prior Hurricane Damage and the PR Restoration, the Improvements and the Personal Property shall not be removed, demolished or materially altered (except for normal replacement of the Personal Property) without the consent of Lender or as otherwise permitted pursuant to Section 4.21 hereof. Except in connection with the Prior Hurricane Damage and the PR Restoration, Borrower shall perform (or shall cause to be performed) the prompt repair, replacement and/or rebuilding of any part of the Property which may be destroyed by any casualty, or become damaged, worn or dilapidated or which may be affected by any proceeding of the character referred to in Section 3.14 hereof and shall complete and pay for (or cause the completion and payment for) any structure at any time in the process of construction or repair on the Land. Borrower shall operate the Property for the same uses as the Property is currently operated and similar uses as are customary in retail shopping center operations and Borrower shall not, without the prior written consent of Lender, (i) change the use of the Property to any use which is not customary in retail shopping center operations or (ii) initiate, join in, acquiesce in, or consent to any change in any private restrictive covenant, zoning law or other public or private restriction, limiting or defining the uses which may be made of the Property or any part thereof to the extent the same is reasonably likely to have a Material Adverse Effect. If under applicable zoning provisions the use of all or any portion of the Property is or shall become a nonconforming use, Borrower will not cause or permit the nonconforming use to be discontinued or the nonconforming Improvement to be abandoned without the express written consent of Lender. Borrower agrees not to commit, permit or suffer to exist any act or omission affording any right of forfeiture with respect to any Individual Property.
Section 4.4.Waste. Borrower shall not commit or suffer any waste of the Property (it being acknowledged that the Prior Hurricane Damage and the PR Restoration shall not constitute waste to any Individual Puerto Rico Property) or make any change in the use of the Property which will in any way materially increase the risk of fire or other hazard arising out of the operation of the Property, or take any action that might invalidate or give cause for cancellation of any Policy, or do or permit to be done thereon anything that is reasonably expected to in any way materially impair the value of the Property or the security for the Loan. Borrower will not,
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without the prior written consent of Lender, permit any drilling or exploration for or extraction, removal, or production of any minerals from the surface or the subsurface of the Property, regardless of the depth thereof or the method of mining or extraction thereof.
Section 4.5.Taxes and Other Charges.
(a)Subject to Borrower’s right to contest in accordance with Section 4.5(b) below, Borrower shall pay (or cause to be paid) all Taxes and Other Charges now or hereafter levied or assessed or imposed against the Property or any part thereof prior to the same becoming delinquent or penalties or fees accruing thereon; provided, however, prior to the occurrence and continuance of an Event of Default, Borrower’s obligation to directly pay Taxes at the Plaza del Sol Property and the Individual Continental Properties only shall be suspended for so long as Borrower complies with the terms and provisions of Section 8.6 hereof. Borrower shall, not later than ten (10) Business Days after receipt of written request from Lender, furnish to Lender receipts for the payment of the Taxes and the Other Charges prior to the date the same shall become delinquent (provided, however, that Borrower is not required to furnish such receipts for payment of Taxes in the event that such Taxes have been paid by Lender pursuant to Section 8.6 hereof). Borrower shall not suffer and shall promptly cause to be paid and discharged any lien or charge whatsoever which may be or become a lien or charge against the Property (or any portion thereof), other than Permitted Encumbrances, and shall promptly pay for or cause to be paid all utility services provided to the Property (or any portion thereof).
(b)After prior written notice to Lender (provided, that, prior written notice shall not be required if such Taxes or Other Charges being contested have been paid in full), Borrower, at its own expense, may contest (or permit to be contested) by appropriate legal proceeding, promptly initiated and conducted in good faith and with due diligence, the amount or validity or application in whole or in part of any Taxes or Other Charges, provided that (i) no Event of Default has occurred and remains uncured; (ii) such proceeding shall be permitted under and be conducted in accordance with the provisions of any other instrument to which Borrower is subject and shall not constitute a default thereunder and such proceeding shall be permitted by and conducted in accordance with all applicable Legal Requirements; (iii) neither the applicable Individual Property nor any part thereof or interest therein will be in imminent danger of being sold, forfeited, terminated, canceled or lost; (iv) Borrower shall promptly upon final determination thereof pay the amount of any such Taxes or Other Charges, together with all costs, interest and penalties which may be payable in connection therewith; (v) such proceeding shall suspend the collection of such contested Taxes or Other Charges from the applicable Individual Property; and (vi) to the extent that the aggregate amount reasonably determined to cause Borrower’s compliance with such Taxes and Other Charges exceeds $500,000, Borrower shall furnish such security as may be required in the proceeding, or deliver to Lender such reserve deposits as may be requested by Lender, to insure the payment of any such Taxes or Other Charges, together with all interest and penalties thereon. Lender may pay over any such cash deposit or part thereof held by Lender to the claimant entitled thereto at any time when, in the judgment of Lender, the entitlement of such claimant is established or the applicable Individual Property (or part thereof or interest therein) shall be in danger of being sold, forfeited, terminated, canceled or lost or there shall be any danger of the lien of the Security Instrument being primed by any related lien.
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Section 4.6.Litigation. Additional Obligor and Borrower shall give prompt written notice to Lender of any litigation or governmental proceedings pending or threatened in writing against Borrower, Pledgor, Sponsor, Additional Obligor or SPE Component Entity which would reasonably be expected to have a Material Adverse Effect.
Section 4.7.Access to Property. Borrower shall permit agents, representatives and employees of Lender to inspect the Property or any part thereof at reasonable hours upon reasonable advance notice, subject in all cases to the terms of the Leases.
Section 4.8.Notice of Default. Additional Obligor and Borrower shall promptly advise Lender of the occurrence of any Event of Default of which Borrower has knowledge.
Section 4.9.Cooperate in Legal Proceedings. Additional Obligor and Borrower shall reasonably cooperate fully with Lender with respect to any proceedings before any court, board or other Governmental Authority which may in any way affect the rights of Lender hereunder or any rights obtained by Lender under any of the Note, the Security Instrument or the other Loan Documents and, in connection therewith, permit Lender, at its election, to participate in any such proceedings.
Section 4.10.Performance by Borrower. Each of Additional Obligor and Borrower hereby acknowledges and agrees that Additional Obligor’s and Borrower’s observance, performance and fulfillment of each and every covenant, term and provision to be observed and performed by each of Additional Obligor and Borrower under this Agreement, the Security Instrument, the Note and the other Loan Documents to which it is a party is a material inducement to Lender in making the Loan.
Section 4.11.Intentionally Omitted.
Section 4.12.Books and Records.
(a)Borrower shall furnish to Lender:
(i)quarterly (and prior to a Securitization (if requested by Lender) or during a Trigger Period, monthly) certified rent rolls, Tenant sales reports (to the extent available) and a certified report of any Major Leases (for purposes of this clause (a)(i), a Major Lease shall refer to any Lease meeting the requirements set forth in the definition of Major Lease at any Individual Property) for which Borrower has received written notice of an event of default thereunder for each Individual Property within fifteen (15) days after the end of each calendar month or forty five (45) days after the end of each calendar quarter, as applicable;
(ii)quarterly (and prior to a Securitization (if requested by Lender) or during a Trigger Period, monthly) financial statements, operating statements of each Individual Property detailing the revenues reported, the expenses incurred and the components of Net Cash Flow before and after Debt Service and major capital improvements for the period of calculation and containing appropriate year-to-date information, within fifteen (15) days after the end of each calendar month or forty five (45) days after the end of each calendar quarter, as applicable, accompanied by an Officer’s Certificate certifying that the same are true, correct and complete in all material respects and, except with respect to the statement of components of Net Cash Flow,
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were prepared in accordance with GAAP applied on a consistent basis, subject to changes resulting from normal year-end audit adjustments;
(iii)subject to Section 4.12(b) and without duplication thereof, within eighty-five (85) days after the close of each fiscal year of Borrower (or such shorter time period as Lender shall determine in its reasonable discretion is necessary to comply with any applicable Legal Requirements (including, without limitation, Regulation AB), provided, that, (I) Lender shall notify Borrower in writing that such a shorter time period is required and (II) unless there is a change in Regulation AB or any other applicable Legal Requirement after the Closing Date, in no event shall such time period be shortened to sooner than eighty five (85) days after the close of each fiscal year of Borrower), annual unaudited financial statements of Borrower (or any 100% direct or indirect owner of Borrower, including Sponsor, that owns no material assets other than such ownership interest of Borrower) including (A) with respect to each Borrower, an annual balance sheet, profit and loss statement and statement of change in financial position and (B) an annual operating statement, in each case, detailing the revenues reported, the expenses incurred and the components of Net Cash Flow before and after Debt Service and major capital improvements for the period of calculation and containing appropriate year-to-date information, accompanied by an Officer’s Certificate certifying that the same are true, correct and complete in all material respects and, except with respect to the statement of components of Net Cash Flow (provided that Borrower shall identify on such statement which components of Net Cash Flow are not prepared in accordance with GAAP), were prepared in accordance with GAAP applied on a consistent basis, subject to changes resulting from normal year-end audit adjustments;
(iv)subject to Section 4.12(b) and without duplication thereof, within one hundred and twenty (120) days after the close of each fiscal year of Borrower (or such shorter time period as Lender shall determine in its reasonable discretion is necessary to comply with any applicable Legal Requirements (including, without limitation, Regulation AB), provided, that, (I) Lender shall notify Borrower in writing that such a shorter time period is required and (II) unless there is a change in Regulation AB or any other applicable Legal Requirement after the Closing Date, in no event shall such time period be shortened to sooner than one hundred twenty (120) days after the close of each fiscal year of Borrower), audited financial statements of Borrower (or any 100% direct or indirect owner of Borrower, including Sponsor, that owns no material assets other than such ownership interest of Borrower) including (A) with respect to each Borrower, an annual balance sheet, and statement of cash flow, profit and loss statement and statement of change in financial position and (B) an annual operating statement, in each case, detailing the revenues reported, the expenses incurred and the components of Net Cash Flow before and after Debt Service and major capital improvements for the period of calculation and containing appropriate year-to-date information, it being acknowledged that the statement of components of Net Cash Flow shall not be prepared in accordance with GAAP;
(v)(I) by no later than December 1 of each calendar year and (II) within thirty (30) days of the commencement of any Trigger Period, an annual operating and capital budget (which shall include, a general business plan) for the next succeeding calendar year presented on a monthly basis consistent with the annual operating statement described above for each Individual Property, including cash flow projections for the upcoming year and all proposed capital replacements and improvements (an “Annual Budget”), which such Annual Budget shall (A) until the occurrence and continuance of a Trigger Period, be provided to Lender for informational purposes and (B) after the occurrence and during the continuance of a Trigger
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Period not take effect until approved by Lender (after such approval has been given in writing, each such approved budget shall be referred to herein, individually or collectively (as the context requires), as the “Approved Annual Budget”). Until such time that Lender approves a proposed annual budget, (1) to the extent that an Approved Annual Budget does not exist for the immediately preceding calendar year, the budget provided to Lender for informational purposes shall apply, provided that the same shall be adjusted to reflect actual increases in Taxes, Insurance Premiums and utilities expenses and (2) to the extent that an Approved Annual Budget exists for the immediately preceding calendar year, such Approved Annual Budget shall apply to the then current calendar year; provided, that such Approved Annual Budget shall be adjusted to reflect actual increases in Taxes, Insurance Premiums and utilities expenses. In the event that Lender has the right to approve a proposed annual budget pursuant to this clause (v) and provided, no Event of Default has occurred and is continuing, such approval shall be deemed granted if the Deemed Approval Requirements have been satisfied with respect thereto; and
(vi)(A) prior to a Securitization, within three (3) Business Days of Lender’s request therefor, (B) during a Trigger Period, no later than fifteen (15) days after and as of the end of each calendar month, and (C) at all other times no later than forty-five (45) days after and as of the end of each calendar quarter, a calculation of the then current Debt Yield, together with such back-up information as Lender shall require.
(b)As of the Closing Date, Sponsor owns no other material assets other than its interests in the Borrowers. Accordingly and for so long as Sponsor owns no other material assets other than its interests in the Borrowers (it being understood that in the event Sponsor owns material assets other than its interests in the Borrowers, Borrower shall be obligated to comply with the requirements set forth in Sections 4.12(a)(iii) and (iv) above (including the requirement to deliver audited financials of Borrower)), in lieu of the requirements of Sections 4.12(a)(iii) and (iv) above, Borrower shall cause Sponsor to furnish within one hundred and twenty (120) days after the close of each fiscal year of Sponsor (or such shorter time period as Lender shall determine in its reasonable discretion is necessary to comply with any applicable Legal Requirements (including, without limitation, Regulation AB), provided, that, (I) Lender shall notify Borrower in writing that such a shorter time period is required and (II) unless there is a change in Regulation AB or any other applicable Legal Requirement after the Closing Date, in no event shall such time period be shortened to sooner than eighty five (85) days after the close of each fiscal year of Sponsor), audited financial statements of Sponsor (with a certified schedule that reconciles the audited statements for the Collateral for the Loan), together with a schedule certified by Sponsor identifying by Individual Property the revenues reported, the expenses incurred and the components of Net Cash Flow before and after Debt Service and major capital improvements for the period of calculation and containing appropriate year-to-date information with respect to each such Individual Property, it being acknowledged that the statement of components of Net Cash Flow shall not be prepared in accordance with GAAP.
(c)Borrower shall, within fifteen (15) Business Days of request, furnish Lender (and shall cause and/or Sponsor to furnish to Lender) with such other additional financial or management information as may, from time to time, be reasonably required by Lender in form and substance reasonably satisfactory to Lender. Borrower shall furnish to Lender and its agents convenient facilities for the examination and audit of any such books and records.
(d)Borrower agrees that (i) Borrower shall keep adequate books and records of account and (ii) all Required Financial Items (defined below) to be delivered to Lender
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pursuant to Section 4.12 shall: (A) be complete and correct; (B) present fairly the financial condition of the applicable Person; (C) disclose all material liabilities that are required to be reflected or reserved against; (D) be prepared (1) in the form reasonably required by Lender and certified by a Responsible Officer of Borrower (2) in electronic format and (3) in accordance with the Approved Accounting Method; and (E) other than as set forth in Sections 4.12(a)(iii) and (iv) and Section 4.12(b), not include any Person other than Borrower and shall show each Borrower and each Individual Property individually and on a combined, aggregate basis with all Borrowers and all Individual Properties. Borrower shall be deemed to warrant and represent that, as of the date of delivery of any such financial statement, there has been no material adverse change in financial condition, nor have any assets or properties been sold, transferred, assigned, mortgaged, pledged or encumbered since the date of such financial statement except as disclosed by Borrower in a writing delivered to Lender. Borrower agrees that all Required Financial Items shall not contain any misrepresentation or omission of a material fact.
(e)Borrower acknowledges the importance to Lender of the timely delivery of each of the items required by this Section 4.12 and the other financial reporting items required by this Agreement (each, a “Required Financial Item” and, collectively, the “Required Financial Items”). In the event Borrower fails to deliver to Lender any of the Required Financial Items within the time frame specified herein (each such event, a “Reporting Failure”), then Borrower shall pay to Lender the sum of $1,000.00 per occurrence for each Reporting Failure.
(f)Borrower shall promptly furnish to Lender copies of any and all budgets, financial statements or other reports prepared by or on behalf of the Condominium Board, or Manager and delivered to Borrower or any of their respective Affiliates pursuant to and in accordance with the Condominium Documents or the Management Agreement (or Qualified Management Agreement applicable).
(g)Semi-annually Borrower shall conduct a review of the tax status of each Individual Puerto Rico Property and a reassessment of any parcels related to such Individual Puerto Rico Properties. Promptly following Borrower’s completion of such review, Borrower shall provide to Lender an update of the list of tax parcel numbers for each Individual Puerto Rico Property attached to the Borrower’s Certificate as Exhibit H and any other documentation prepared by, or on behalf of Borrower, in connection with such review.
(h)Borrower shall promptly furnish to Lender written notice (containing reasonable detail describing the particular event or circumstance) of any material change (which shall include, but is not limited to, the addition or termination of any Major Lease (for purposes of this clause (g), Major Lease shall refer to any Lease meeting the requirements set forth in the definition of Major Lease at any Individual Property) or any Policy (including terrorism coverage) required under this Agreement) in the (x) financial condition of Borrower, Guarantor, Pledgor, Additional Obligor or any SPE Component Entity, or (y) physical condition of any Individual Property.
(i)Borrower and Lender covenant and agree that (i) for purposes of calculating the Debt Yield, Loan-to-Value Ratio and/or the Debt Service Coverage Ratio under any of the Loan Documents, such calculation shall take into account each Combined Individual Property as a whole with reference to each Combined Individual Property Parcel that is then
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subject to the lien of the Loan Documents making up such Combined Individual Property, and (ii) for purposes of any Required Financial Items, such Required Financial Items shall take into account each Combined Individual Property as a whole with reference to each Combined Individual Property Parcel that is then subject to the lien of the Loan Documents making up such Combined Individual Property.
Section 4.13.Estoppel Certificates.
(a)After written request by Lender, Borrower, within fifteen (15) Business Days of such request, shall furnish Lender or any proposed assignee with a statement, duly acknowledged and certified setting forth (i) the original principal amount of the Loan, (ii) the unpaid principal amount of the Loan, (iii) the rate of interest of the Loan, (iv) the terms of payment and maturity date of the Loan, (v) the date installments of interest and/or principal were last paid, (vi) that, except as provided in such statement, no Event of Default exists, (vii) that this Agreement, the Note, the Security Instrument and the other Loan Documents are valid, legal and binding obligations and have not been modified or if modified, giving particulars of such modification, (viii) whether any offsets or defenses exist against the obligations secured hereby and, if any are alleged to exist, a detailed description thereof, (ix) that all Leases are in full force and effect and have not been modified (or if modified, setting forth all modifications), (x) the date to which the Rents thereunder have been paid pursuant to the Leases, (xi) whether or not any of the lessees under the Major Leases (for purposes of this clause (xi), Major Lease shall refer to any Lease meeting the requirements set forth in the definition of Major Lease at any Individual Property) are in default under such Major Leases (for purposes of this clause (xi), Major Lease shall refer to any Lease meeting the requirements set forth in the definition of Major Lease at any Individual Property), beyond any applicable notice and cure period, and, if any of such lessees are in default, setting forth the specific nature of all such defaults, (xii) the amount of Security Deposits held by Borrower under each Lease and that such amounts are consistent with the amounts required under each Lease, and (xiii) as to any other matters reasonably requested by Lender and reasonably related to the Leases, the obligations created and evidenced hereby and by the Security Instrument, the Pledge Agreement, the Collateral or the Property.
(b)Borrower shall use commercially reasonable efforts to deliver to Lender, promptly upon request (but no more than one time in any calendar year so long as no Event of Default has occurred and is continuing), duly executed estoppel certificates from any one or more Tenants as required by Lender attesting to such facts regarding the Lease as Lender may reasonably require, including, but not limited to, attestations that each Lease covered thereby is in full force and effect with no defaults thereunder on the part of any party, that none of the Rents have been paid more than one month in advance, except as security, no free rent or other concessions are due lessee and that the lessee claims no defense or offset against the full and timely performance of its obligations under the Lease.
(c)Borrower shall use commercially reasonable efforts to deliver to Lender, within fifteen (15) Business Days of request, estoppel certificates from each party under any Property Document in form and substance reasonably acceptable to Lender.
(d)Upon Lender’s request, Borrower shall use commercially reasonable efforts to deliver to Lender an estoppel certificate from the lessor under the Ground Lease in a
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form reasonably acceptable to such lessor and Lender stating that (i) the Ground Lease is in full force and effect and has not been modified, amended or assigned, (ii) neither the lessor nor Borrower is in default under any of the terms, covenants or provisions of the Ground Lease and such lessor knows of no event which, but for the passage of time or the giving of notice or both, would constitute an event of default under the Ground Lease, (iii) neither the lessor nor Borrower has commenced any action or given or received any notice for the purpose of terminating the Ground Lease and (iv) all sums due and payable under the Ground Lease have been paid in full.
Section 4.14.Leases and Rents.
(a)Unless Borrower shall have received Lender’s prior written consent, all Leases and all renewals of Leases executed after the date hereof shall (i) provide for rental rates comparable to existing local market rates for similar properties, (ii) be on commercially reasonable terms with unaffiliated, third parties (unless otherwise consented to by Lender), (iii) for the Plaza del Sol Property and each Individual Continental Property, as applicable, provide that such Lease is subordinate to the Security Instrument and that the lessee will attorn to Lender and any purchaser at a foreclosure sale and (iv) not contain any terms which would have a Material Adverse Effect. Notwithstanding anything to the contrary contained herein, Borrower shall not, without the prior written approval of Lender (which approval shall not be unreasonably withheld or delayed), enter into, renew, extend, amend, modify, permit any assignment of or subletting under, waive any material provisions of, release any party to, terminate, reduce rents under, accept a surrender of space under, or shorten the term of, in each case, any Major Lease at the Plaza del Sol Property or any Individual Continental Property, as applicable. At any time that Lender’s approval is required under this Section 4.14(a), provided no Event of Default is continuing, Lender’s approval shall be deemed granted if the Deemed Approval Requirements have been satisfied with respect thereto.
(b)Without limitation of subsection (a) above, except in connection with Prior Hurricane Damage, Borrower (i) shall observe and perform the material obligations imposed upon the lessor under the Leases in a commercially reasonable manner; (ii) shall enforce the terms, covenants and conditions contained in the Leases upon the part of the lessee thereunder to be observed or performed in a commercially reasonable manner (which shall not, for the avoidance of doubt, require termination thereof); (iii) shall not collect any of the Rents more than one (1) month in advance (other than Security Deposits); (iv) shall not execute any assignment of lessor’s interest in the Leases or the Rents (except as contemplated by the Loan Documents); (v) shall not, without Lender’s prior written consent, alter, modify or change any Lease to the extent the same would, individually or in the aggregate, (A) cause any such Lease to violate Section 4.14(a)(i) through (iii) above or (B) have a Material Adverse Effect; and (vi) shall hold all Security Deposits in accordance with Legal Requirements. Upon request, Borrower shall furnish Lender with executed copies of all Leases.
(c)Notwithstanding anything contained herein to the contrary, Borrower shall not willfully withhold from Lender any information required to be delivered pursuant to the terms of this Agreement regarding renewal, extension, amendment, modification, waiver of provisions of, termination, rental reduction of, surrender of space of, or shortening of the term of, any Lease during the term of the Loan. Borrower further agrees to provide Lender on a quarterly basis with written notice of any Tenants under any Major Leases “going dark” under such
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Tenant’s Major Lease, it being understood that, with respect to any Individual Puerto Rico Property for which the related PR Restoration has been completed in accordance with Section 4.29 hereof, the foregoing notice requirement shall apply to any Major Lease at such Individual Puerto Rico Property. Borrower agrees to use commercially reasonable efforts to provide Lender with written notice of any monetary event of default under a Major Lease within ten (10) Business Days after the occurrence of any such event of default, it being understood that, with respect to any Individual Puerto Rico Property for which the related PR Restoration has been completed in accordance with Section 4.29 hereof, the foregoing notice requirement shall apply to any Major Lease at such Individual Puerto Rico Property. Borrower’s obligations under this Section 4.14(c) shall be deemed satisfied in the required information is set forth in the reports delivered by Borrower or Sponsor pursuant to Section 4.12.
(d)Borrower shall notify Lender in writing, within five (5) Business Days following receipt thereof, of Borrower’s receipt of any early termination fee or payment or other termination fee or payment paid by any Tenant under any Lease at the Plaza del Sol Property or any Individual Continental Property, as applicable, and Borrower further covenants and agrees that Borrower shall pay to Lender such amount for deposit into the Leasing Reserve Account and such deposit shall not be subject to any “cap” or similar limit relating to the Leasing Reserve Funds.
(e)Upon the occurrence of an Event of Default, Borrower shall, within thirty (30) days of demand by Lender, deliver to Lender all Security Deposits. Without limitation of any other term or provision contained herein, for purposes of clarification, for a Security Deposit to be deemed “delivered to Lender” in connection with the foregoing, the same must be in the form of cash or in a letter of credit solely in Lender’s name.
(f)Lender, at the request of Borrower, shall enter into a subordination, attornment and non-disturbance agreement in a form that is reasonably satisfactory to Lender and such Tenant (a “Non-Disturbance Agreement”) in connection with any Tenant under a Major Lease, any Tenants under a Lease who are leasing the land demised under such Lease and own the improvements thereon or any nationally or regionally recognized Tenant entering into a Lease in each instance, in accordance with the terms and conditions hereof that requires a Non-Disturbance Agreement pursuant to the terms of its Lease (other than a Lease to an Affiliate of Borrower) after the Closing Date; provided that Lender, at the request of Borrower, shall use commercially reasonable efforts to enter into a Non-Disturbance Agreement with all other Tenants. Lender shall promptly respond, at Borrower’s sole costs and expense, to any request by a Tenant under a Major Lease for an amendment to an existing Non-Disturbance Agreement. If Borrower requests Lender to enter into a Non-Disturbance Agreement with any Tenant in substantially the same form attached hereto as Exhibit E, then Lender shall deliver such Non-Disturbance Agreement in such form within ten (10) Business Days of written request therefor. All actual and reasonable, out‑of‑pocket costs and expenses of Lender and Servicer in connection with the negotiation, preparation, execution and delivery by Lender and Servicer of any Non-Disturbance Agreement shall be paid by Borrower, including, without limitation, reasonable attorneys’ fees and disbursements and the current fee being assessed by Servicer in connection therewith, provided, that such fee to Servicer shall not exceed $1,500.00.
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Section 4.15.Management Agreement.
(a)Borrower shall and shall cause Manager to (i) diligently and promptly perform, observe and enforce in all material respects all of the terms, covenants and conditions of the Management Agreement on the part of Borrower or Manager to be performed, observed and enforced to the end that all things shall be done which are necessary to keep unimpaired the rights of Borrower under the Management Agreement; (ii) promptly notify Lender of any default under the Management Agreement after the expiration of any grace, notice or cure periods; (iii) promptly deliver to Lender a copy of any notice of default or other material notice received by Borrower under the Management Agreement; (iv) promptly give notice to Lender of any written notice that Borrower receives which indicates that Manager is terminating the Management Agreement or that Manager is otherwise discontinuing its management of the Property; and (v) promptly enforce in a commercially reasonable manner the performance and observance of all of the covenants required to be performed and observed by Manager under the Management Agreement.
(b)Borrower shall not, without the prior written consent of Lender (such consent not to be unreasonably withheld, conditioned or delayed), (i) surrender, terminate or cancel the Management Agreement, consent to any assignment of the Manager’s interest under the Management Agreement or otherwise replace Manager or renew or extend any Management Agreement (exclusive of, in each case, any automatic renewal or extension in accordance with its terms) or enter into any other new or replacement management agreement with respect to the Property; provided, however, that Borrower may, in accordance with the terms and conditions of this Section 4.15, replace Manager and/or consent to the assignment of Manager’s interest under the Management Agreement, in each case, in accordance with the applicable terms and conditions hereof and of the other Loan Documents; (ii) reduce or consent to the reduction of the term of the Management Agreement; (iii) increase or consent to the increase of the amount of any charges under the Management Agreement; (iv) otherwise modify, change, alter or amend, in any material respect, or waive or release any of its material rights and remedies under, the Management Agreement in any material respect; or (v) transfer the direct and/or indirect equity interests and/or any change in Control of any Affiliated Manager.
(c)If Borrower shall default in the performance or observance of any material term, covenant or condition of the Management Agreement on the part of Borrower to be performed or observed, then, without limiting the generality of the other provisions of this Agreement, and without waiving or releasing Borrower from any of its obligations hereunder, Lender shall have the right, but shall be under no obligation, to pay any sums and to perform any act or take any action as may be reasonably appropriate to cause all the terms, covenants and conditions of the Management Agreement on the part of Borrower to be performed or observed to be promptly performed or observed on behalf of Borrower, to the end that the rights of Borrower in, to and under the Management Agreement shall be kept unimpaired and free from default. Lender and any Person designated by Lender shall have, and are hereby granted, the right to enter upon the Property, subject to the rights of Tenant, at any time and from time to time for the purpose of taking any such action. If Manager shall deliver to Lender a copy of any notice sent to Borrower of default under the Management Agreement, such notice shall constitute full protection to Lender for any action taken or omitted to be taken by Lender in good faith, in reliance thereon. Borrower shall notify Lender if any Affiliated Manager sub-contracts to a third
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party or an Affiliate any or all of its management responsibilities under the Management Agreement and shall notify Lender, promptly following Borrower’s knowledge thereof, if any Manager that is not an Affiliated Manager sub-contracts to a third party.
(d)Borrower shall, from time to time, use its commercially reasonable efforts to obtain from Manager under the Management Agreement such certificates of estoppel with respect to compliance by Borrower with the terms of the Management Agreement as may be reasonably requested in writing by Lender, but in no event shall such request be made more than once in any calendar year unless an Event of Default has occurred and is continuing. Borrower shall exercise each individual option, if any, to extend or renew the term of the Management Agreement upon demand by Lender made at any time within one (1) year of the last day upon which any such option may be exercised.
(e)In the event that the Management Agreement is scheduled to expire at any time during the term of the Loan, Borrower shall submit to Lender by no later than thirty (30) days prior to such expiration a draft replacement management agreement for approval in accordance with the terms and conditions hereof.
(f)Borrower shall have the right to replace Manager or consent to the assignment of Manager’s rights under the Management Agreement without the prior written consent of Lender, in each case, to the extent that (i) Lender receives at least thirty (30) days prior written notice of the same (or, to the extent that a New Non-Consolidation Opinion is not required to be delivered with respect to such assignment in accordance with Section 4.15(h) below, five (5) Business Days’ prior written notice of the same), (ii) such replacement or assignment (as applicable) will not result in a Property Document Event or default (after expiration of applicable notice and cure periods) under any Ground Lease or Condominium Documents and (iii) the applicable New Manager is a Qualified Manager engaged pursuant to a Qualified Management Agreement. So long as any Affiliated Manager is being paid in accordance with the terms of the Management Agreement, such Affiliated Manager shall not (and Borrower shall not permit such Affiliated Manager to) resign as Manager or otherwise cease managing the Property until a New Manager is engaged to manage the Property in accordance with the applicable terms and conditions hereof and of the other Loan Documents.
(g)Without limitation of the foregoing, if the Management Agreement is terminated or expires (including, without limitation, pursuant to the Assignment of Management Agreement), comes up for renewal or extension (exclusive of, in each case, any automatic renewal or extension in accordance with its terms), ceases to be in full force or effect or is for any other reason no longer in effect (including, without limitation, in connection with any Sale or Pledge), then Lender, at its option, may require Borrower to engage, in accordance with the terms and conditions set forth herein and in the Assignment of Management Agreement, a New Manager to manage the Property, which such New Manager shall (i) to the extent an Event of Default is continuing and if opted by Lender, selected by Lender and (ii) be a Qualified Manager and shall be engaged pursuant to a Qualified Management Agreement.
(h)As conditions precedent to any engagement of a New Manager hereunder, (i) New Manager and Borrower shall execute an Assignment of Management Agreement in the form required by Lender (with such changes thereto as may be required by the Rating Agencies),
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and (ii) to the extent that such New Manager is an Affiliated Manager, unless such New Manager is assuming the Management Agreement and not entering into a new Qualified Management Agreement, Borrower shall deliver to Lender a New Non-Consolidation Opinion with respect to such New Manager and new management agreement.
(i)Any sums expended by Lender pursuant to this Section 4.15, to the extent not paid by Borrower within five (5) Business Days of Lender’s demand therefor, shall bear interest at the Default Rate from the date such cost is incurred to the date of payment to Lender, shall be deemed to constitute a portion of the Debt, shall be secured by the lien of the Security Instrument and the other Loan Documents and shall be immediately due and payable upon demand by Lender therefor.
(j)Borrower shall notify Lender if Manager sub-contracts to a third party or an Affiliate (any such Person, a “Sub-Manager”) any or all of its management responsibilities under the Management Agreement. Each Sub-Manager must be a Qualified Manager and each sub-management agreement must be a Qualified Management Agreement. Unless the sub-management agreement provides that (w) the sub-management agreement and any fees or other amounts owing to Sub-Manager are subordinate to the Loan, (x) Sub-Manager shall look to Borrower (not Lender or any designee or nominee of Lender) for payment of any fees or other amounts due and owing under the related sub-management agreement, (y) the sub-management agreement automatically terminates (with no liability to Lender) upon the termination of the Management Agreement and (z) Sub-Manager shall deposit all Rents and other revenue from the applicable Individual Property into the applicable Restricted Account within one (1) Business Day of receipt, Borrower shall cause any Sub-Manager to execute and deliver to Lender an assignment of sub-management agreement and subordination of sub-management fees substantially in the form as the Assignment of Management Agreement on the Closing Date, with such changes as may be approved by Lender in its reasonable discretion (or of such other form and substance reasonably acceptable to Lender, Borrower and Sub-Manager), executed and delivered to Lender by Borrower, Manager and Sub-Manager.
Section 4.16.Payment for Labor and Materials.
(a)Subject to Section 4.16(b) below, and, in respect to the Individual Puerto Rico Properties, from and after the completion (which date of completion shall be determined by Borrower exercising its commercially reasonable business judgment) of the PR Restoration, Borrower will pay (or cause to be paid) when due all bills and costs for labor, materials, and specifically fabricated materials incurred by or on behalf of Borrower in connection with the Property (any such bills and costs, a “Work Charge”) and never permit to exist in respect of the Property or any part thereof any lien or security interest, even though inferior to the liens and the security interests hereof, and in any event never permit to be created or exist in respect of the Property or any part thereof any other or additional lien or security interest other than the liens or security interests created hereby and by the Security Instrument, except for the Permitted Encumbrances.
(b)After prior written notice to Lender with respect to any matters at an Individual Property which are reasonably expected to be in excess of $500,000 (on an individual basis) (provided, however that, prior written notice to Lender is required at any time the
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aggregate amount of disputed Work Charges at a given time is equal to or greater than $1,500,000), Borrower, at its own expense, may contest by appropriate legal proceeding, promptly initiated and conducted in good faith and with due diligence, the validity of any Work Charge, the applicability of any Work Charge to Borrower or to any Individual Property or any alleged non-payment of any Work Charge and defer paying the same, provided that (i) no Event of Default has occurred and is continuing; (ii) such proceeding shall be permitted under and be conducted in accordance with the provisions of any instrument to which Borrower is subject and shall not constitute a default thereunder and such proceeding shall be conducted in accordance with all applicable Legal Requirements; (iii) neither the applicable Individual Property nor any part thereof or interest therein will be in imminent danger of being sold, forfeited, terminated, cancelled or lost; (iv) Borrower shall promptly upon final determination thereof pay (or cause to be paid) any such contested Work Charge determined to be valid, applicable or unpaid; (v) such proceeding shall suspend the collection of such contested Work Charge from the applicable Individual Property or Borrower shall have paid the same (or shall have caused the same to be paid) under protest; and (vi) to the extent that the aggregate amount reasonably determined to cause Borrower’s compliance with such Work Charge exceeds $500,000, Borrower shall furnish (or cause to be furnished) such security as may be required in the proceeding, or as may be reasonably requested by Lender, to insure payment of such Work Charge, together with all interest and penalties payable in connection therewith. Lender may apply any such security or part thereof, as necessary to pay for such Work Charge at any time when, in the judgment of Lender, the validity, applicability or non-payment of such Work Charge is finally established or the applicable Individual Property (or any part thereof or interest therein) shall be in present danger of being sold, forfeited, terminated, cancelled or lost.
Section 4.17.Performance of Other Agreements. Except as excused or delayed in connection with any Prior Hurricane Damage, Borrower shall observe and perform each and every material term to be observed or performed by Borrower pursuant to the terms of any agreement or recorded instrument affecting or pertaining to the Property (or any portion thereof), or given by Borrower to Lender for the purpose of further securing the Debt and any amendments, modifications or changes thereto.
Section 4.18.Debt Cancellation. Borrower shall not cancel or otherwise forgive or release any claim or debt (other than termination of Leases in accordance herewith or settlement of Tenant or similar disputes) owed to Borrower by any Person, except for adequate consideration and in the ordinary course of Borrower’s business.
Section 4.19.ERISA.
(a)Assuming no source of funds for the Loan constitutes “plan assets” within the meaning of Section 3(42) of ERISA, none of Pledgor, Additional Obligor, any SPE Component Entity or Borrower shall engage in any transaction which would cause any obligation, or action taken or to be taken, hereunder (or the exercise by Lender of any of its rights hereunder or under the other Loan Documents) to be a non-exempt prohibited transaction under ERISA.
(b)Borrower further covenants and agrees to deliver to Lender such certifications or other evidence from time to time throughout the term of the Security Instrument,
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as requested by Lender in its reasonable discretion, that (i) none of Pledgor, Additional Obligor, any SPE Component Entity, or Borrower is an “employee benefit plan” as defined in Section 3(3) of ERISA, or other retirement arrangement, which is subject to Title I of ERISA or Section 4975 of the IRS Code, or a “governmental plan” within the meaning of Section 3(32) of ERISA; (ii) none of Pledgor, Additional Obligor, any SPE Component Entity, or Borrower is subject to state statutes regulating investments and fiduciary obligations with respect to governmental plans; and (iii) one or more of the following circumstances is true:
(A)Equity interests in Borrower are publicly offered securities, within the meaning of 29 C.F.R. § 2510.3 101(b)(2);
(B)Less than 25 percent of each outstanding class of equity interests in Borrower are held by “benefit plan investors” within the meaning of 29 C.F.R.§ 2510.3 101, as modified by Section 3(42) of ERISA; or
(C)Pledgor, Additional Obligor, any SPE Component Entity, or Borrower qualifies as an “operating company” or a “real estate operating company” within the meaning of 29 C.F.R § 2510.3 101(c) or (e) or an investment company registered under The Investment Company Act of 1940, as amended.
(c)None of Pledgor, Additional Obligor, any SPE Component Entity, or Borrower shall maintain, sponsor, contribute to or become obligated to contribute to, or suffer or permit any member of Pledgor’s, Additional Obligor’s, any SPE Component Entity’s, or Borrower’s “controlled group of corporations” to maintain, sponsor, contribute to or become obligated to contribute to a “defined benefit plan” or a “multiemployer pension plan”. The terms in quotes above are defined in Section 3.7 of this Agreement.
Section 4.20.No Joint Assessment. Borrower shall not suffer, permit or initiate the joint assessment of any Individual Property with (a) any other real property constituting a tax lot separate from the applicable Individual Property, or (b) any portion of the applicable Individual Property which may be deemed to constitute personal property, or any other procedure whereby the lien of any taxes which may be levied against such personal property shall be assessed or levied or charged to the applicable Individual Property.
Section 4.21.Alterations. Notwithstanding anything contained herein (including, without limitation, Article 8 hereof) to the contrary, Lender’s prior approval shall be required in connection with any alterations to any Improvements (specifically excluding any alterations in connection with the PR Restoration) (a) that could reasonably be expected to have a Material Adverse Effect, (b) the cost of which (including any related alteration, improvement or replacement) is reasonably anticipated to exceed the applicable Alteration Threshold, but specifically excluding (1) the costs of any capital expenditures and tenant improvements set forth in Leases entered into in accordance with this Agreement, (2) Unfunded Obligations, (3) Immediate Repairs, (4) Environmental Work, (5) the additional environmental work set forth on Schedule 4.25 hereof, (6) the PR Restoration work, (7) alterations set forth on an Approved Annual Budget and (8) Additional Pre-Approved Alterations or (c) that are structural in nature and could reasonably be expected to have a Material Adverse Effect, which approval may be granted or withheld in Lender’s reasonable discretion. If the total unpaid amounts incurred and to be incurred with respect to any alterations to the Improvements shall at any time exceed the applicable Alteration Threshold, but specifically excluding the costs of any capital expenditures
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and tenant improvements set forth in Leases entered into in accordance with this Agreement, Borrower shall promptly deliver to Lender as security for the payment of such amounts and as additional security for Borrower’s obligations under the Loan Documents any of the following: (i) cash, (ii) U.S. Obligations, (iii) other security reasonably acceptable to Lender, (provided that Lender shall have received a Rating Agency Confirmation as to the form and issuer of same), or (iv) a completion bond (provided that Lender shall have received a Rating Agency Confirmation as to the form and issuer of same). Such security shall be in an amount equal to the excess of the total unpaid amounts incurred and to be incurred with respect to such alterations to the Improvements over the applicable Alteration Threshold and shall (1) so long as no Event of Default and no Trigger Period has occurred and is continuing, be released to Borrower and (2) to the extent that a Trigger Period has occurred and is continuing, but no Event of Default is continuing, be deposited in the Cash Management Account, in each instance, when the remaining unpaid amounts with respect to such alterations are equal to or less than the Alteration Threshold. At any time that Lender’s approval is required under this Section 4.21, provided no Event of Default is continuing, Lender’s approval shall be deemed granted if the Deemed Approval Requirements have been satisfied with respect thereto.
Section 4.22.Property Document Covenants. Without limiting the other provisions of this Agreement and the other Loan Documents, except as excused or delayed in connection with the Prior Hurricane Damage, Borrower shall (i) reasonably perform and/or observe, in all material respects and using commercially reasonable business judgment, all of the covenants and agreements required to be performed and observed by it under the Property Documents and do all things reasonably necessary to preserve and to keep unimpaired its material rights thereunder; (ii) promptly notify Lender of any default under the Property Documents of which it is aware that could have a Material Adverse Effect on such Individual Property; (iii) use commercially reasonable efforts to enforce the performance and observance of all of the material covenants and agreements required to be performed and/or observed under the Property Documents in a manner that will not result in a Material Adverse Effect on such Individual Property; (iv) cause the applicable Individual Property to be operated, in all material respects, in accordance with the Property Documents in a manner that will not result in a Material Adverse Effect on such Individual Property; (v) if the foregoing could reasonably be expected to cause a Material Adverse Effect on such Individual Property, not, without the prior written consent of Lender, (A) enter into any new Property Document or replace or execute material modifications to any existing Property Documents or renew or extend the same (exclusive of, in each case, any automatic renewal or extension in accordance with its terms), (B) surrender, terminate or cancel the Property Documents, (C) reduce or consent to the reduction of the term of the Property Documents, or (D) increase or consent to the increase of the amount of any charges payable by Borrower in any material respects under the Property Documents, other than pursuant to the express terms thereof; and (vi) following the occurrence and during the continuance of an Event of Default, not exercise any rights, make any decisions, grant any approvals or otherwise take any action under the Property Documents, other than pursuant to the express terms thereof.
Section 4.23.Environmental Liability Insurance Policy. Borrower shall maintain in full force and effect at all times during the term of the Loan the applicable environmental insurance policy or policies approved by Lender and in effect on the Closing Date.
Section 4.24.Additional Deferred Maintenance. Borrower shall use commercially reasonable efforts to diligently pursue to completion in accordance with all applicable Legal Requirements the repair of the non-hurricane related structural issues at the Individual Properties
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described on Schedule 3.12(e) attached hereto and shall promptly provide to Lender evidence, satisfactory to Lender, of the same when such work is completed.
Section 4.25.Environmental Requirements. Borrower shall promptly commence and diligently pursue the completion of the environmental remediation, testing and repair, in each instance, as set forth on Schedule 4.25 hereof (the “Environmental Work”), in accordance with all Environmental Laws, other applicable Legal Requirements and any applicable O&M Program.
Section 4.26.Condominium Covenants.
(a)With respect to the Condominium, Borrower covenants as follows:
(i)it will not, without Lender’s prior written consent, vote to amend, modify, supplement or terminate, or consent to (1) the termination of any of the Condominium Documents or (2) the amendment, modification or supplementation of any of the Condominium Documents, in each case, in any material respect which would cause a Material Adverse Effect on the applicable Individual Property;
(ii)it will pay (or cause to be paid) all Condominium Charges and expenses actually assessed against, and payable by, those Units then owned or leased by it pursuant to the Condominium Documents prior to delinquency, other than assessments or Condominium Charges that are being contested in good faith pursuant to the Condominium Documents and this Agreement;
(iii)it will comply in all material respects with all of the terms, covenants and conditions on its part to be complied with, pursuant to the Condominium Documents and any applicable Condominium Laws and rules and regulations that may be adopted for the Condominium as the same shall be in force and effect from time to time, provided that the failure of the Condominium Board to be inactive shall not be a breach of this clause (iii) as long as such inactivity does not give rise to a Material Adverse Effect on such Individual Property;
(iv)it will take all commercially reasonable actions as may be necessary from time to time to preserve and maintain the Condominium in accordance with the applicable Condominium Law; it will not, without the prior written consent of Lender, take (and hereby assigns to Lender any right it may have to take) any action to terminate the Condominium, withdraw the Condominium from the Condominium Law, or cause a partition of the Condominium;
(v)it will not, without Lender’s prior written consent, (A) vote to permit any of the terms or provisions of the Condominium Documents to be materially modified, supplemented or amended, including, without limitation, changing the boundaries of any Unit, changing any ownership percentage interest or vote allocated to a Unit or changing any rights of Borrower to appoint members to the Condominium Board or permit the Condominium to be terminated, withdrawn from a condominium regime, partitioned, subdivided, expanded or otherwise modified and/or (B) relinquish any rights that Borrower has under the Condominium Documents;
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(vi)for so long as Borrower or Manager controls the Condominium Board, it shall use commercially reasonable efforts to cause the Condominium Board to (a) promptly comply with all Legal Requirements applicable to the Condominium and the Unit which Borrower owns, leases or otherwise occupies, (b) to the extent in Borrower’s control, promptly repair, replace or rebuild any part of the Condominium and the Units to the extent benefitting the Unit owned, leased or otherwise used by the Borrower which may be damaged or destroyed by any casualty or which may be affected by any condemnation proceeding and Borrower shall not in such event vote to not repair, restore or rebuild the Condominium without the prior written consent of Lender, (c) complete and pay for, within a reasonable time, any structure at any time in the process of construction or repair on the Condominium and the Units to the extent required to be completed or paid for by Borrower under the Condominium Documents, (d) to the extent that it has the power and authority to do so, refrain from taking any action with respect to the Condominium and/or the Unit owned or leased by the applicable Borrower that would be contrary to or inconsistent with, in any material respect, any applicable covenant contained in this Agreement, the related Security Instrument or any other Loan Document, (e) refrain from establishing significant working capital reserves or other similar reserves or to undertake significant capital expenditures without Lender’s prior written consent, provided that Lender’s consent shall not be required for any working capital reserves or other similar reserves intended to cover the costs of repairs, alterations or other work otherwise permitted hereunder and (f) refrain from creating any new Units or selling any Units; and
(vii)in the event that the Seabrook Condominium becomes active and board members are appointed, Borrower shall provide to Lender prompt notice thereof and in connection with Borrower’s activation of such association and appointment of board members, Borrower shall obtain resignation letters from each voting member of the Condominium Board appointed or selected by Borrower and any officers of the Seabrook Condominium appointed by Borrower, which resignation letters shall be in form and substance reasonably acceptable to Lender and shall be held by Lender in escrow and may, at Lender’s option, be submitted at any time after Lender’s acceleration of the Loan following an Event of Default.
(b)The provisions of Article 7 hereof shall apply to the entirety of the Plaza del Sol Property or any Individual Continental Property that is a Condominium as provided herein, notwithstanding the submission of any portion of the Plaza del Sol Property or such Individual Continental Property, as applicable, to applicable Condominium Law. Without limiting the generality of the foregoing, Borrower, for and on behalf of itself and its direct and indirect successors and assigns as owner(s) or lessee(s) of condominium units in the Condominium or any of them, (i) irrevocably waives, to the extent permitted by law and the Condominium Documents, any applicable law which grants to the trustees or the board of directors of the Condominium and/or the owners and/or lessee(s) of the condominium units rights in the event of a casualty or a condemnation which are inconsistent with the provisions of Article 7 hereof and (ii) expressly agrees to the application of the insurance proceeds and condemnation awards in accordance with Article 7 hereof to the extent permitted by applicable law and the Condominium Documents.
(c)Lender shall have the right, subject to any required consent of the Unit owners and, if applicable, lessees, at reasonable times and upon reasonable notice, to inspect the records of the Condominium as provided in the Condominium Documents until such time as the Debt is paid in full.
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(d)Borrower will use commercially reasonable efforts to obtain and deliver to the Lender, a true and correct copy of any notice of material default or other material notice given to Borrower in respect of the observance of the Condominium Documents or any of them.
(e)Without the prior written consent of the Lender, Borrower shall not vote to approve any of the following matters in connection with the Condominium (unless expressly required under the Condominium Documents): (i) any material and adverse change in the nature and amount of any insurance covering all or a part of the Condominium and the disposition of any proceeds thereof, but only to the extent any of the foregoing violates the Loan Documents; (ii) the manner in which any condemnation or threat of condemnation of all or a part of the applicable Individual Property shall be defended or settled and the disposition of any award or settlement in connection therewith, but only to the extent the foregoing violates the Loan Documents; (iii) any amendment to the Condominium Documents which by its terms requires the consent of Lender and any removal of any portion of the Plaza del Sol Property or the applicable Individual Continental Property, as applicable, from the provisions of the Condominium Law; (iv) the creation of, or any change in, any private restrictive covenant, zoning ordinance, or other public or private restrictions, now or hereafter limiting or defining the uses which may be made of the applicable Individual Property or any part thereof, other than Permitted Encumbrances in each event to the extent that same is reasonably likely to cause a Material Adverse Effect on the Plaza del Sol Property or the applicable Individual Continental Property, as applicable, or (v) any material relocation of the boundaries of the Plaza del Sol Property or the applicable Individual Continental Property, as applicable.
(f)During the continuance of an Event of Default, Lender shall have the right, to the extent permitted under the Condominium Documents, but not the obligation, to cure any default by Borrower under the Condominium Documents to the extent such default could reasonably be expected to have a Material Adverse Effect on the Individual Property.
(g)Upon the occurrence and continuance of an Event of Default, Lender may vote in place of Borrower and may exercise any and all of the rights and privileges of Borrower. Borrower hereby irrevocably appoints Lender as its attorney-in-fact, coupled with an interest, to vote as Borrower’s proxy and to act with respect to all of said rights so long as such Event of Default continues hereunder or under any other Loan Documents. Notwithstanding anything contained herein to the contrary, nothing contained herein or otherwise shall render Lender liable for any Condominium Charges.
(h)During the continuance of an Event of Default, Lender shall have the right to participate in any arbitration proceeding instituted in accordance with the provisions of the Condominium Documents.
(i)Borrower shall not implement any Condominium regime at any Property without the prior written consent of Lender.
Section 4.27.Ground Lease.
(a)Borrower shall, at Borrower’s sole cost and expense, promptly and timely perform and observe all the material terms, covenants and conditions required to be performed and observed by Borrower as lessee under the Ground Lease (including, but not limited to, the
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payment of all rent, additional rent, percentage rent and other charges required to be paid under the Ground Lease). Borrower shall not provide any notice of non-renewal of the Ground Lease to Ground Lessor.
(b)The actions or payments of Lender to cure any default by Borrower under the Ground Lease shall not remove or waive, as between Borrower and Lender, the default that occurred under this Agreement by virtue of the default by Borrower under the Ground Lease unless and until the Borrower shall have reimbursed Lender for all sums referenced in the immediately succeeding sentence and the applicable default shall have been cured. All sums expended by Lender to cure any such default shall be paid by Borrower to Lender, upon demand, with interest on such sum at the rate set forth in this Agreement from the date such sum is expended to and including the date the reimbursement payment is made to Lender. All such indebtedness shall be deemed to be secured by the related Security Instrument.
(c)Borrower shall notify Lender promptly in writing of the occurrence of any material default by Ground Lessor under the Ground Lease or following the receipt by Borrower of any written notice from Ground Lessor under the Ground Lease noting or claiming the occurrence of any default by Borrower under the Ground Lease or the occurrence of any event that, with the passage of time or service of notice, or both, would constitute a default by Borrower under the Ground Lease. Borrower shall promptly deliver to Lender a copy of any such written notice of default.
(d)Upon written request from Lender and provided that Borrower shall not have notified Lender or does not notify Lender within five (5) Business Days of receipt of such request of Lender, of its intent to release the Ground Leased Property in accordance with Section 2.10, Borrower shall promptly execute, acknowledge and deliver to Lender such instruments as may reasonably be required to permit Lender to cure any default under the Ground Lease or permit Lender to take such other action required to enable Lender to cure or remedy the matter in default and preserve the security interest of Lender under the Loan Documents with respect to each Ground Leased Property. Borrower irrevocably appoints Lender as its true and lawful attorney in fact to do, in its name or otherwise, unless Borrower has notified Lender of its intention to release the Ground Leased Property in accordance with Section 2.10, during the continuance of an Event of Default, any and all acts and to execute any and all documents that are necessary to preserve any rights of Borrower under or with respect to each Ground Lease, including, without limitation, the right to effectuate any extension or renewal of each Ground Lease, or to preserve any rights of Borrower whatsoever in respect of any part of each Ground Lease (and the above powers granted to Lender are coupled with an interest and shall be irrevocable).
(e)Borrower shall exercise each individual option, if any, to extend or renew the term of the Ground Lease within the time periods prescribed under the applicable Ground Lease but under no circumstances later than the current expiration date under the terms of the Ground Lease (the “Renewal Deadline”), and Borrower hereby expressly authorizes and appoints Lender its attorney-in-fact to exercise any such option in the name of and upon behalf of Borrower, which power of attorney shall be irrevocable and shall be deemed to be coupled with an interest. Borrower’s failure to exercise the aforesaid renewal option within the aforesaid period shall, at Lender’s option, constitute an immediate Event of Default hereunder.
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Additionally, Borrower acknowledges that Borrower has delivered to Lender an original executed but undated notice to the landlord under the Ground Lease exercising Borrower’s renewal rights thereunder (such notice, the “Renewal Notice”), which renewal notice is attached hereto as Exhibit G. Borrower hereby irrevocably grants Lender the right to date and transmit the Renewal Notice to the landlord under the Ground Lease; provided, however, Lender shall only do so if, as of the Renewal Deadline, Lender is not in receipt of evidence reasonably acceptable to Lender that Borrower has exercised its right to renew the Ground Lease. Notwithstanding the foregoing to the contrary, with respect to the Peach Street Ground Lease, Borrower shall be entitled, with Lender’s prior written consent (which consent shall not be unreasonably withheld), to not renew such Ground Lease and, if Lender’s consent to Borrower’s request not to renew such Ground Lease is granted, neither Lender nor Borrower shall submit the Renewal Notice and no Event of Default shall exist (or be deemed to exist) because of such failure.
(f)Notwithstanding anything contained in the Ground Lease to the contrary, Borrower shall not, without prior written consent of Lender, sublet any portion of the leasehold estate created by the Ground Lease except in accordance with the express terms and conditions of this Agreement as is applicable to Leases.
(g)Notwithstanding anything to the contrary contained in this Agreement with respect to the Ground Lease:
(i)The lien of the related Security Instrument attaches to all of Borrower’s rights and remedies at any time arising under or pursuant to Subsection 365(h) of the Bankruptcy Code, 11 U.S.C. Sections 101 et seq., including, without limitation, all of Borrower’s rights, as debtor, to remain in possession of the related Ground Leased Property.
(ii)Borrower shall not, without Lender’s prior written consent, elect to treat the Ground Lease as terminated under Subsection 365(h)(l) of the Bankruptcy Code. Any such election made without Lender’s prior written consent shall be void.
(iii)As security for the Debt, Borrower unconditionally assigns, transfers and sets over to Lender all of Borrower’s claims and rights to the payment of damages arising from any rejection by the lessor under the Ground Lease under the Bankruptcy Code. Lender and Borrower shall proceed jointly or in the name of Borrower in respect of any claim, suit, action or proceeding relating to the rejection of the Ground Lease, including, without limitation, the right to file and prosecute any proofs of claim, complaints, motions, applications, notices and other documents in any case in respect of lessor under the Bankruptcy Code. This assignment constitutes a present, irrevocable and unconditional assignment of the foregoing claims, rights and remedies, and shall continue in effect until all of the Debt shall have been satisfied and discharged in full. Any amounts received by Lender or Borrower as damages arising out of the rejection of the Ground Lease as aforesaid shall be applied to all costs and expenses of Lender (including, without limitation, attorneys’ fees and costs) incurred in connection with the exercise of any of its rights or remedies in accordance with the applicable provisions of this Agreement.
(iv)If, pursuant to Subsection 365(h) of the Bankruptcy Code, Borrower seeks to offset, against the rent reserved in the Ground Lease, the amount of any damages caused by the nonperformance by the lessor of any of its obligations thereunder after
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the rejection by lessor of the Ground Lease under the Bankruptcy Code, then Borrower shall not affect any offset of such amounts unless it shall have provided written notice to Lender of its intent to do so and Lender shall have consented thereto (provided Lender shall be deemed to have consented thereto if it shall fail to object to the same in written notice to Borrower within ten (10) Business Days after receipt of the aforementioned notice in which case Borrower may proceed to offset the amounts set forth in Borrower’s notice).
(v)If any action, proceeding, motion or notice shall be commenced or filed in respect of any lessor of all or any part of the Ground Leased Property in connection with any case under the Bankruptcy Code, Lender and Borrower shall cooperatively conduct and control any such litigation with counsel agreed upon between Borrower and Lender in connection with such litigation. Borrower shall, upon demand, pay to Lender all reasonable actual out of pocket costs and expenses (including reasonable attorneys’ fees and costs) actually paid or actually incurred by Lender in connection with the cooperative prosecution or conduct of any such proceedings. All such costs and expenses shall be secured by the lien of the related Security Instrument.
(vi)Borrower shall promptly, after obtaining knowledge of such filing notify Lender in writing of any filing by or against the lessor under the Ground Lease of a petition under the Bankruptcy Code, setting forth any information available to Borrower as to the date of such filing, the court in which such petition was filed, and the relief sought in such filing. Borrower shall promptly deliver to Lender any and all notices, summonses, pleadings, applications and other documents received by Borrower in connection with any such petition and any proceedings relating to such petition.
(vii)If Lender, its nominee, designee, successor, or assignee acquires title and/or rights of Borrower under the Ground Lease by reason of foreclosure of the applicable Security Instrument, deed in lieu of foreclosure or otherwise, such party shall (x) succeed to all of the rights of and benefits accruing to Borrower under the Ground Lease, and (y) be entitled to exercise all of the rights and benefits accruing to Borrower under the Ground Lease. At such time as Lender shall request, Borrower agrees to execute and deliver and use commercially reasonable efforts to cause any third party to execute and deliver to Lender such documents as Lender and its counsel may reasonably require in order to insure that the provisions of this section will be validly and legally enforceable and effective against Borrower and all parties claiming by, through, under or against Borrower.
(viii)Borrower shall not, without Lender’s written consent, fail to exercise any option or right to renew or extend the term of the Ground Lease in accordance with the terms of the related Ground Lease, and shall give immediate written notice to Lender and shall execute, acknowledge, deliver and record any document requested by Lender to evidence the lien of the related Security Instrument on such extended or renewed lease term; provided, however, Borrower shall not be required to exercise any particular such option or right to renew or extend (or to permit the term of the Ground Lease to renew or extend automatically) to the extent Borrower shall have received the prior written consent of Lender (which consent may not be unreasonably withheld, delayed or conditioned) allowing Borrower to forgo exercising such option or right to renew or extend. If Borrower shall fail to exercise any such option or right as aforesaid within thirty (30) days prior to the date when required, Lender may exercise the option or right as Borrower’s agent and attorney in fact as provided above in Lender’s own name or in
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the name of and on behalf of a nominee of Lender, as Lender may determine in the exercise of its sole and absolute discretion.
(ix)Borrower shall not waive, excuse, condone or in any way release or discharge the Ground Lessor under the Ground Lease of or from the Ground Lessor’s material obligations, covenant and/or conditions under the related Ground Lease without the prior written consent of Lender (which consent will not be unreasonably withheld, delayed or conditioned).
(x)Borrower shall not, without Lender’s prior written consent, surrender, terminate, forfeit, or suffer or permit the surrender, termination or forfeiture of, or change, modify or amend, the Ground Lease, other than an extension of the term under its terms, or an expiration of the Ground Lease pursuant to its terms, provided that Borrower may, with the prior written consent of Lender (which consent shall not be unreasonably withheld, conditioned or delayed), enter into a material modification of the Crossroads Ground Lease in order to make the Crossroads Property more marketable for sale (as determined by Borrower exercising its commercially reasonable business judgment), so long as (I) there exists no Event of Default, (II) such modification does not adversely affect Lender’s lien under the Loan Documents or Lender’s rights and interests in, to and under the Crossroads Ground Lease or otherwise cause a Material Adverse Effect with respect to the Crossroads Property, and (III) Lender shall have received a copy of any such amendment to the Crossroads Ground Lease and an updated estoppel from the Ground Lessor thereunder, which estoppel shall be (A) dated on or about the date of, and delivered simultaneously with, the execution of such amendment, (B) substantially similar to the estoppel delivered to Lender in connection with the closing of the Loan and (C) otherwise reasonably acceptable to Lender. Consent to one amendment, change, agreement or modification shall not be deemed to be a waiver of the right to require consent to other, future or successive amendments, changes, agreements or modifications. Any acquisition of Ground Lessor’s interest in the Ground Lease by Borrower or any Affiliate of Borrower shall be accomplished by Borrower in such a manner so as to avoid a merger of the interests of lessor and lessee in the Ground Lease, unless consent to such merger is granted by Lender.
Section 4.28.Additional Collateral.
(a)Each of Additional Obligor and Borrower hereby unconditionally and absolutely assigns, transfers and sets over unto Lender all of Additional Obligor’s and Borrower’s right, title and interest in and to the Additional Collateral, it being intended that this assignment be an absolute assignment from Additional Obligor and Borrower to Lender and not merely the granting of a security interest. Until the occurrence of an Event of Default which remains uncured, Additional Obligor and Borrower may retain, use and enjoy the benefits of the Additional Collateral. Upon the occurrence and during the continuance of an Event of Default, the license described in the preceding sentence shall, upon Lender’s written election, be revoked, and Lender may elect to exercise any and all of Lender’s rights and remedies hereunder; provided, however, that upon Lender’s acceptance of Additional Obligor’s and/or Borrower’s cure or Lender’s waiver of such Event of Default (provided that no other Event of Default is continuing), the license granted to Additional Obligor and Borrower pursuant to this clause (a) shall automatically be reinstated.
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(b)Subject to applicable Legal Requirements, each of Additional Obligor and Borrower hereby irrevocably constitutes and appoints Lender (and any of its officers) as the true and lawful agent and attorney-in-fact (with full powers of substitution) for Additional Obligor and/or Borrower, to, during the continuance of an Event of Default, demand, receive and enforce Additional Obligor’s and/or Borrower’s rights with respect to the Additional Collateral, to give appropriate receipts, releases, and satisfactions for and on behalf of Additional Obligor and/or Borrower and to do any and all acts in the name, place, and stead of Additional Obligor and/or Borrower or in the name of Lender with the same force and effect as Additional Obligor and/or Borrower could do if the foregoing assignment had not been made. The power-of-attorney granted in this clause (b) is deemed to be a power coupled with an interest and shall not terminate until the expiration or termination of the foregoing assignment.
(c)Each of Additional Obligor and Borrower shall remain liable to, and shall, perform all of its material obligations under the Additional Collateral. Additional Obligor and Borrower shall, at their sole cost and expense, enforce the Additional Collateral in a commercially reasonable manner and comply with all of its material obligations under the Additional Collateral. Each of Additional Obligor and Borrower shall give Lender notice of any default by any party under the Additional Collateral, in any case, which is likely to result in a Material Adverse Effect. So long as (i) each of Additional Obligor and Borrower is acting in the ordinary course of business, and (ii) no Event of Default has occurred and is continuing, except as otherwise provided in the Loan Documents, each of Additional Obligor and Borrower may alter, amend, extend, modify, change, cancel or terminate any of the Additional Collateral, provided that such alterations, amendments, extensions, modifications, changes, cancellations and terminations, taken as a whole, are not likely to result in a Material Adverse Effect. So long as (i) each of Additional Obligor and Borrower is acting in the ordinary course of business, and (ii) no Event of Default has occurred and is continuing, except as otherwise provided in the other Loan Documents, Additional Obligor and Borrower may enter into new Additional Collateral on commercially reasonable terms without Lender’s prior written consent in each instance in accordance with the terms and provisions of the Loan Documents.
Section 4.29.Use of Casualty Proceeds.
(a)Borrower shall have the right to withdraw and use the Casualty Proceeds on deposit in the Casualty Proceeds Restricted Account on any Business Day, provided there exists no Event of Default or Mezzanine Loan Default and the terms and provisions of this Section 4.29 are satisfied, as determined by Lender in its reasonable discretion, and provided, further, that such Casualty Proceeds are used to pay for Restoration Costs or toward the payment of the Debt.
(b)Borrower has prepared preliminary or final drafts of the PR Restoration Budget, which details all costs projected by Borrower to be incurred by Borrower in connection with the PR Restoration of each Affected Individual PR Property (such costs, the “Restoration Costs”), with sufficient detail on a line item basis.
(c)Borrower may revise the PR Restoration Budget from time to time, provided that any such revisions to the PR Restoration Budget shall be delivered to Lender.
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(d)The PR Restoration shall be completed in accordance with all applicable Legal Requirements, the PR Restoration Budget and the terms and provisions of this Agreement and the other Loan Documents.
(e)Borrower shall have the right to settle all claims related to the Prior Hurricane Damage and the Prior Hurricane Damage (Plaza del Sol), as applicable, under the insurance policies for the Affected Individual PR Properties without Lender’s consent, provided that (a) no Event of Default has occurred and is continuing, and (b) Borrower promptly and with commercially reasonable diligence negotiates a settlement of any such claims. Notwithstanding the foregoing, if an Event of Default exists, Lender shall, at its election, have the exclusive right to settle or adjust any claims related to the Prior Hurricane Damage and the Prior Hurricane Damage (Plaza del Sol), under such policies.
(f)During the continuance of an Event of Default, upon written request of Lender, Borrower shall cooperate with Lender to assign to Lender, as applicable, any and all plans and specifications required in connection with the PR Restoration, all contracts and subcontracts and other agreements with any materialmen, architects, engineers and other contractors performing work in connection with the PR Restoration and all permits, licenses and approvals required or obtained in connection with the PR Restoration. All out-of-pocket third party costs and expenses incurred by Lender in connection with the PR Restoration and the Casualty Proceeds Restricted Account shall be paid by Borrower.
(g)Within thirty (30) days of the end of each calendar month until all Casualty Proceeds have been exhausted, which obligation shall not be a condition precedent to the right of Borrower to withdraw and use the Casualty Proceeds on deposit in the Casualty Proceeds Restricted Account, Borrower shall deliver to Lender a certificate from Borrower (A) stating that the items funded by the withdrawals from the Casualty Proceeds Restricted Account during the preceding calendar month were used to pay for Restoration Costs or amounts due and payable under the Loan, (B) if such amounts were used to pay for Restoration Costs, identifying the amount withdrawn from the Casualty Proceeds Restricted Account and the Affected Individual PR Property that was the beneficiary of expenditure and certifying that such amounts were used in accordance with the approved PR Restoration Budget, (C) if such amounts were used to pay for amounts due and payable under the Loan, identifying the amount withdrawn from the Casualty Proceeds Restricted Account and the items funded with such amounts, (D) stating that all Restoration Costs at the applicable Affected Individual PR Property to be funded by the withdrawals from the Casualty Proceeds Restricted Account during the preceding calendar month have been completed, to the extent of such payment, in a good and workmanlike manner and in accordance with all applicable Legal Requirements, such certificate to be accompanied by a copy of any license, permit or other approval required by any Governmental Authority in connection with the PR Restoration (if any), (E) identifying each Person that supplied materials or labor in connection with the Restoration Costs funded by the withdrawals from the Casualty Proceeds Restricted Account during the preceding calendar month and (F) stating that each such Person has been paid in full, such certificate to be accompanied by, to the extent available in Puerto Rico and otherwise in the possession and/or control of Borrower or its Affiliates, lien waivers, invoices and/or other evidence of payment of amounts owing reasonably satisfactory to Lender for payments in excess of $50,000.
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(h)At Lender’s option (which option shall, to the extent there exists no Event of Default, be only exercisable up to two (2) times in any twelve (12) month period), if the cost of any individual Restoration Cost exceeds $100,000, a title search (at Borrower’s cost and expense) for the applicable Affected Individual PR Property indicating that the applicable Affected Individual PR Property is free from all liens, claims and other encumbrances other than Permitted Encumbrances.
(i)Nothing in this Agreement shall (i) make Lender responsible for making or completing the PR Restoration; (ii) require Lender to expend funds to complete any such PR Restoration; (iii) obligate Lender to proceed with the PR Restoration; or (iv) obligate Lender to demand from Borrower additional sums to complete any such PR Restoration.
(j)Borrower shall permit Lender and Lender’s agents and representatives (including, without limitation, Lender’s engineer, architect, or inspector) or third parties to enter onto the Affected Individual PR Property upon reasonable advance notice during normal business hours (subject to the rights of Tenants under their Leases) to inspect, from time to time, the progress of any PR Restoration and all materials being used in connection therewith and to examine all plans and shop drawings relating to such PR Restoration. Borrower shall use commercially reasonable efforts to cause all contractors and subcontractors to cooperate with Lender or Lender’s representatives or such other Persons described above in connection with inspections described in this Section 4.29.
(k)Within thirty (30) days of the completion (which date of completion shall be determined by Borrower exercising its commercially reasonable business judgment) of the PR Restoration at an Affected Individual PR Property, Borrower shall deliver to Lender an Officer’s Certificate (x) confirming that such PR Restoration at such Affected Individual PR Property has been completed (and all Restoration Costs for such Affected Individual PR Property have been paid in full) in accordance with the PR Restoration Budget, all Legal Requirements and this Agreement, (y) as of the date of such completion of the PR Restoration, remaking each of the representations and warranties with respect to the Individual Puerto Rico Properties (without qualification as to the PR Property Representation Condition or the Prior Hurricane Damage or the Prior Hurricane Damage (Plaza del Sol), as applicable, set forth in the Loan Documents) set forth in Article 3 hereof for the benefit of Lender with respect to such Affected Individual PR Property with any exceptions as Borrower deems reasonably necessary to such representations and warranties being described on a schedule attached to such Officer’s Certificate and (z) attaching all lien waivers not previously delivered to Lender that are in Borrower’s or its Affiliates’ possession or control. Upon completion of the PR Restoration for each such Affected Individual PR Property, the covenants contained in the Loan Documents shall apply to such Affected Individual PR Property from and after the date of such completion without any reference to, or be qualified by, the Prior Hurricane Damage or the Prior Hurricane Damage (Plaza del Sol), as applicable, the PR Property Representation Condition or the PR Restoration. Upon delivery of the Officer’s Certificate to Lender referred to above, Borrower shall permit Lender and Lender’s agents and representatives (including, without limitation, Lender’s engineer, architect, or inspector) or third parties to enter onto the Affected Individual PR Property for which the PR Restoration has been completed upon reasonable advance notice during normal business hours (subject to the rights of Tenants under their Leases) to conduct a final inspection of such Affected Individual PR Property.
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(l)Provided no Event of Default has occurred and is continuing, any Casualty Proceeds remaining in the Casualty Proceeds Restricted Account after the completion of the PR Restoration at each Affected Individual PR Property shall be disbursed to Borrower upon receipt by Lender of evidence (satisfactory to Lender in all respects), which evidence may include updated property condition reports, zoning reports and final unconditional lien waivers, that all Affected Individual PR Property have been fully restored in accordance with all Legal Requirements and this Agreement.
Section 4.30.REIT Distributions. During the term of the Loan, Borrower and Sponsor shall undertake all reasonable and necessary actions to preserve Sponsor’s status as a REIT. In connection therewith, notwithstanding anything in this Agreement to the contrary, for each taxable year of Sponsor, Borrower and Sponsor shall utilize their respective sources of liquidity in the following order and priority to make any and all Required REIT Distributions and to pay all TRS Taxes and Puerto Rico Taxes:
(a)first, to the extent of available funds and otherwise pursuant to the terms of this Agreement, (i) amounts released to Borrower from the Cash Management Account in accordance with the Loan Documents (after payment of Debt Service and other amounts due and owing under the Loan (including deposits into Reserve Accounts) and Operating Expenses) and (ii) Excess Cash Flow (and Excess Cash Flow Funds) shall be used to pay all Required REIT Distributions, TRS Taxes and Puerto Rico Taxes;
(b)second, available funds from any Corporate Loan (or any other credit facility available to Sponsor or its Affiliates) shall be used to pay all Required REIT Distributions, TRS Taxes and Puerto Rico Taxes until such funds are fully exhausted; and
(c)lastly, available funds from the Required REIT Distributions and Tax Account.
Section 4.31.Puerto Rico Borrower Covenants. Each Puerto Rico Borrower hereby pledges and assigns to Lender as collateral for the Loan and grants to Lender a security interest in, all of such Puerto Rico Borrower’s rights, interests and estates now owned, or hereafter acquired by such Puerto Rico Borrower, to the extent of such Puerto Rico Borrower’s right, title and interest therein to the following: (i) all Rents and all proceeds from the sale or other disposition of the Leases and the right to receive and apply the Rents to the payment of the Debt; (ii) all insurance proceeds (including, without limitation, BI Proceeds and Casualty Proceeds) in respect of each Individual Puerto Rico Property under any insurance policies covering each Individual Puerto Rico Property, including, without limitation, the right to receive and apply the proceeds of any insurance, judgments, or settlements made in lieu thereof, for damage to each Individual Puerto Rico Property; (iii) all reserves, escrows and deposit accounts maintained by Puerto Rico Borrower with respect to each Individual Puerto Rico Property, including without limitation, the Accounts and all cash, checks, drafts, certificates, securities, investment property, financial assets, instruments and other property held therein from time to time and all proceeds, products, distributions or dividends or substitutions thereon and thereof; together with all deposits or wire transfers made to such accounts and all cash, checks, drafts, certificates, securities, investment property, financial assets, instruments and other property held therein from time to time and all proceeds, products, distributions or dividends or substitutions thereon and
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thereof; (iv) all proceeds of any of the foregoing items set forth in subsections (i) through (iii), whether cash, liquidation claims (or other claims) or otherwise; and (v) any and all other rights of Borrower in and to the items set forth in subsections (i) through (iv) above. Borrower hereby authorizes Lender to file a financing statement or statements under the UCC in connection with any perfect Lender’s security interest in the foregoing.
Section 4.32.Additional Pre-Approved Alterations.
(a)To the extent that Borrower elects to undertake any Additional Pre-Approved Alterations at the Palma Real Property, Borrower shall complete such Additional Pre-Approved Alterations at the Palma Real Property promptly following commencement thereof, in accordance with the Loan Documents, Property Documents and all Legal Requirements. For the avoidance of doubt, Borrower shall have no obligation to undertake any Additional Pre-Approved Alterations at the Palma Real Property but if Borrower commences any Additional Pre-Approved Alterations at the Palma Real Property, it must complete same in accordance with the Loan Documents, Property Documents and all Legal Requirements.
(b)Nothing in this Agreement shall (i) make Lender responsible for making or completing the Additional Pre-Approved Alterations; (ii) require Lender to expend funds to complete any such Additional Pre-Approved Alterations; (iii) obligate Lender to proceed with the Additional Pre-Approved Alterations; or (iv) obligate Lender to demand from Borrower additional sums to complete any such Additional Pre-Approved Alterations.
(c)Borrower shall permit Lender and Nova to enter onto the Individual Property subject to the Additional Pre-Approved Alterations upon reasonable advance notice during normal business hours (subject to the rights of Tenants under their Leases) to inspect, from time to time, the progress of any Additional Pre-Approved Alterations and all materials being used in connection therewith and to examine all plans relating to such Additional Pre-Approved Alterations. Borrower shall use commercially reasonable efforts to cause all contractors and subcontractors to cooperate with Lender and/or Nova in connection with inspections described in this Section 4.32.
(d)Within thirty (30) days of completion (which date of completion shall be determined by Borrower exercising its commercially reasonable business judgment) of the Pre-Approved Alterations at the applicable Individual Property, Borrower shall (i) provide Lender with evidence reasonably acceptable to Lender of such completion; (ii) provide lien waivers and a title search to confirm that no lien, charge or encumbrance whatsoever, other than any Permitted Encumbrance, then exists; and (iii) deliver to Lender an Officer’s Certificate (x) confirming that such Pre-Approved Alterations at such applicable Individual Property have been completed (and all costs related thereto have been paid in full) in accordance with all Legal Requirements and this Agreement, and (y) attaching all lien waivers not previously delivered to Lender that are in Borrower’s or its Affiliates’ possession or control. Upon delivery of the Officer’s Certificate to Lender referred to above, Borrower shall permit Lender and/or Nova to enter onto the Individual Property for which the Additional Pre-Approved Alterations have been completed upon reasonable advance notice during normal business hours (subject to the rights of Tenants under their Leases) to conduct a final inspection of such Individual Property.
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(e)After commencement of the Pre-Approved Alterations at an applicable Individual Property, within thirty (30) days of the end of each calendar month until completion of such Pre-Approved Alterations at such Individual Property which obligation shall not be a condition precedent to the right of Borrower to commence, pursue or complete such Pre-Approved Alterations, Borrower shall deliver to Lender a certificate from Borrower (A) stating that all costs related to the Pre-Approved Alterations at such Individual Property incurred during the preceding calendar month have been paid in full (or if not yet paid in full, are not delinquent), (B) stating that all costs related to the Pre-Approved Alterations at such Individual Property incurred during the preceding calendar month have been completed, to the extent of such payment, in a good and workmanlike manner and in accordance with all applicable Legal Requirements, such certificate to be accompanied by a copy of any license, permit or other approval required by any Governmental Authority in connection with such Pre-Approved Alterations (if any), (C) identifying each Person that supplied materials or labor in connection with such Pre-Approved Alterations incurred during the preceding calendar month and (D) stating that each such Person has been paid in full, such certificate to be accompanied by, to the extent available in the applicable jurisdiction and otherwise in the possession and/or control of Borrower or its Affiliates, lien waivers, invoices and/or other evidence of payment of amounts owing reasonably satisfactory to Lender for payments in excess of $50,000.
(f)Notwithstanding anything in the foregoing to the contrary, Borrower shall complete the Additional Pre-Approved Alterations at the Plaza del Norte Property or complete the PR Restoration of the Plaza del Norte Property in accordance with the Loan Documents, Property Documents and all Legal Requirements, in each case, on or before September 11, 2020.
ARTICLE 5
ENTITY COVENANTS
Section 5.1.Single Purpose Entity/Separateness.
(a)(I) Each Borrower (other than a Recycled SPE Borrower/SPE Component Entity), each SPE Component Entity, Additional Obligor and each Pledgor has not since its formation, (II) each Recycled SPE Borrower/SPE Component Entity has complied with clauses (i)(A), (ii)(A) and (vii) below since its formation and (III) each Borrower, each SPE Component Entity, Additional Obligor and each Pledgor will not, except as may be provided for in this Agreement or as set forth in Section 5.5:
(i) (A) with respect to Borrower, except with respect to the Previously-Owned Properties, engage in any business or activity other than the ownership, operation, management, leasing and maintenance of the applicable Individual Property, and activities related or incidental thereto, and refinancing the Properties in connection with a repayment of the Loan or any subsequent or other Loan, (B) with respect to Pledgor, own its interest in the Collateral and engage in activities related or incidental thereto, (C) with respect to SPE Component Entity, act as a general partner of the limited partnership that owns the related Individual Property or as member of the limited liability company that owns the related Individual Property and transact lawful business that is incident, necessary and appropriate to
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accomplish the foregoing and (D) with respect to Additional Obligor, act as the account holder under the Cash Management Account for the benefit of each Borrower;
(ii)(A) with respect to Borrower, except with respect to the Previously-Owned Properties, acquire or own any assets other than (x) the applicable Individual Property, and (y) such incidental Personal Property as may be necessary for the ownership, leasing, maintenance and operation of such applicable Individual Property and activities related or incidental thereof, (B) with respect to Pledgor, own its interest in the Collateral and engage in activities related or incidental thereto, (C) with respect to SPE Component Entity and Pledgor, own the limited partnership or limited liability company interests in the related Borrower and personal property necessary or incidental to its ownership of such interests and (D) with respect to Additional Obligor, act as the account holder under the Cash Management Account for the benefit of each Borrower;
(iii)divide or otherwise engage in or permit any Division or have the power to engage in or permit any Division, merge into or consolidate with any Person, or dissolve, terminate, liquidate in whole or in part, transfer (other than with respect to any transfer permitted pursuant to Section 6.3(iii) hereof) or otherwise dispose of all or substantially all of its assets or change its legal structure and has not been the product of, the subject of or otherwise involved in, in each case, any limited liability company division (whether pursuant to a plan of Division or otherwise);
(iv)fail to observe all organizational formalities, or fail to preserve its existence as an entity duly organized, validly existing and in good standing (if applicable) under the applicable Legal Requirements of the jurisdiction of its organization or formation, or amend, modify, terminate or fail to comply with the provisions of its organizational documents (provided, that, such organizational documents may be amended or modified to the extent that, in addition to the satisfaction of the requirements related thereto set forth therein, Lender’s prior written consent, such consent not to be unreasonably withheld, conditioned or delayed and, if required by Lender, a Rating Agency Confirmation are first obtained);
(v)own any subsidiary, or make any investment in, any Person (other than, with respect to any SPE Component Entity or Pledgor (as applicable), in the applicable Borrower);
(vi)commingle its funds or assets with the funds or assets of any other Person (other than another Person comprising Borrower hereunder);
(vii)other than as permitted by this Agreement, and except with respect to debt that has been paid in full prior to the date of this Agreement, incur any Indebtedness, secured or unsecured, direct or contingent (including guaranteeing any obligation), other than, with respect to Borrower (A) the Debt, (B) trade and operational indebtedness incurred in the ordinary course of business with trade creditors, provided such indebtedness is (1) unsecured, (2) not evidenced by a note, (3) on commercially reasonable terms and conditions, and (4) due not more than ninety (90) days past the date incurred and paid on or prior to such date, and/or (C) Permitted Equipment Leases, (D) obligations pursuant to the Ground Leases, (E) obligations pursuant to the Previously-Owned Property Sale Agreements; (F) real estate taxes not yet
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delinquent, (G) Capital Expenditures spent and completed in accordance with this Agreement and paid when due, and (H) tenant allowances and tenant improvements incurred pursuant to Leases entered into in accordance with this Agreement and paid when due; provided however, the aggregate amount of the indebtedness described in (B) and (C) shall not exceed at any time (I) with respect to the Plaza del Sol Borrower and any individual Continental Borrower, two percent (2%) of the outstanding aggregate Allocated Loan Amounts associated with the Plaza del Sol Property or Individual Continental Property, as applicable, owned by the Plaza del Sol Borrower or such Continental Borrower, as applicable, and (II) with respect to all of the Borrowers, in the aggregate, two percent (2%) of the outstanding principal amount of the Loan. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the Property or Collateral;
(viii)fail to maintain all of its books, records, financial statements and bank accounts separate from those of any other Person (including, without limitation, any Affiliates), except that Borrower’s, Pledgor’s, Additional Obligor’s or SPE Component Entity’s assets and liabilities may be included in a consolidated financial statement of its Affiliates so long as appropriate notation is made on such consolidated financial statements to indicate the separateness of Borrower, Pledgor, Additional Obligor or SPE Component Entity from such Affiliates and to indicate that Borrower’s, Pledgor, Additional Obligor or SPE Component Entity’s assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person. Borrower’s, Pledgor’s, Additional Obligor’s or SPE Component Entity’s assets have not and will not be listed as assets on the financial statement of any other Person; provided, however, that Borrower’s, Pledgor’s, Additional Obligor’s or SPE Component Entity’s assets may be included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation shall be made on such consolidated financial statements to indicate the separateness of Borrower, Pledgor, Additional Obligor or SPE Component Entity and such Affiliates and to indicate that Borrower’s, Pledgor’s, Additional Obligor’s or SPE Component Entity’s assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person and (ii) such assets shall be listed on Borrower’s, Pledgor’s, Additional Obligor’s or SPE Component Entity’s own separate balance sheet. Borrower, Pledgor, Additional Obligor or SPE Component Entity has maintained and will maintain its books, records, resolutions and agreements as official records;
(ix)enter into any contract or agreement with any partner, member, shareholder, principal or Affiliate including the Management Agreement, except, in each case in the ordinary course of business and upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arm’s-length basis with unaffiliated third parties;
(x)maintain its assets in such a manner that it will be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person, except for the other Persons comprising Borrower hereunder;
(xi)assume or guaranty the debts of any other Person, hold itself out to be responsible for the debts of any other Person, or otherwise pledge its assets for the benefit of any other Person or hold out its credit as being available to satisfy the obligations of any other
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Person, except in each case for the other Persons comprising Borrower, Additional Obligor or Pledgor hereunder in connection with this Agreement and the other Loan Documents;
(xii)make any loans or advances to any Person;
(xiii)fail to file its own Tax returns separate from those of any other Person (unless prohibited by applicable Legal Requirements from doing so or except to the extent Borrower, SPE Component Entity, Additional Obligor or Pledgor is treated as a “disregarded entity” for tax purposes and is not required to file such Tax returns under applicable Legal Requirements);
(xiv)fail to (A) hold itself out to the public and identify itself, in each case, as a legal entity separate and distinct from any other Person and not as a division or part of any other Person, (B) conduct its business solely in its own name, (C) hold its assets solely in its own name (or the name of other Persons comprising Borrower hereunder) or (D) correct any known misunderstanding regarding its separate identity;
(xv)fail to maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations (to the extent there exists sufficient cash flow from the applicable Individual Property to do so), provided, however, that no Person shall be required to make any direct or indirect capital contributions to Borrower, Pledgor, Additional Obligor or SPE Component Entity in order to comply with the foregoing;
(xvi)without the prior unanimous written consent of all of its partners, shareholders or members, as applicable, the prior unanimous written consent of its board of directors or managers, as applicable, and the prior written consent of each Independent Director (regardless of whether such Independent Director is engaged at the Borrower, Pledgor, Additional Obligor or SPE Component Entity level), (a) file or consent to the filing of any petition, either voluntary or involuntary, to take advantage of any Creditors Rights Laws, (b) seek or consent to the appointment of a receiver, liquidator or any similar official, (c) take any action with the intent to cause such entity to become insolvent, (d) make an assignment for the benefit of creditors or (e) take any Material Action with respect to Borrower, Pledgor, Additional Obligor or any SPE Component Entity (provided, that, none of any member, shareholder or partner (as applicable) of Borrower, Pledgor or any SPE Component Entity or any board of directors or managers (as applicable) of Borrower, Pledgor, Additional Obligor or any SPE Component Entity may vote on or otherwise authorize the taking of any of the foregoing actions unless, in each case, there are at least two (2) Independent Directors then serving in such capacity in accordance with the terms of the applicable organizational documents and each of such Independent Directors have consented to such foregoing action);
(xvii)fail to allocate shared expenses (including, without limitation, shared office space) or fail to use separate invoices and checks bearing its own name; provided, however, that it is acknowledged and agreed that the Accounts and the Borrower’s operating account may be opened in the name of one Borrower (on behalf of the other Borrowers) or Additional Obligor (with respect to the Cash Management Account) and that it shall not be a breach of this Agreement if checks on behalf of any Borrower entity are issued by the name of