Exhibit 6
PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT (this "AGREEMENT"), dated as of December 18,
1998, is by and between PRIME GROUP VI, L.P., an Illinois limited partnership
(the "PLEDGOR"), and LaSalle National Bank (the "PLEDGEE").
W I T N E S S E T H
WHEREAS, the Pledgor and the Pledgee are parties to that certain
Loan Agreement, dated as of December 18, 1998, as it may be amended from time to
time (the "LOAN AGREEMENT"), pursuant to which the Pledgee has agreed to extend
loans and certain other financial accommodations to the Pledgor;
WHEREAS, the Pledgor presently owns 115,000 shares of class A
common stock, $0.01 par value per share ("AIMCO STOCK"), of Apartment
Investment and Management Company, a Maryland corporation that qualifies as a
real estate investment trust ("AIMCO"), 3,576,933 shares of common stock, $0.01
par value per share ("BROOKDALE STOCK"), of Brookdale Living Communities, Inc.,
a Delaware corporation ("BROOKDALE"), 104,632 Common Units of partnership
interest ("PRIME RETAIL PARTNERSHIP UNITS") in Prime Retail, L.P., a Delaware
limited partnership ("PRIME RETAIL OPERATING PARTNERSHIP") and 47,525 Common
Units of partnership interest ("PRIME GROUP REALTY PARTNERSHIP UNITS") in Prime
Group Realty, L.P., a Delaware limited partnership ("PRIME GROUP REALTY
OPERATING PARTNERSHIP"). Collectively, the AIMCO Stock, the Brookdale Stock,
the Prime Retail Partnership Units and the Prime Group Realty Partnership Units
are referred to herein as the "PRIME SECURITIES";
WHEREAS, pursuant to the Third Amended and Restated Agreement of
Limited Partnership of the Prime Retail Operating Partnership dated as of
October 15, 1998 (as amended, modified or restated from time to time, the "PRIME
RETAIL PARTNERSHIP AGREEMENT"), the Prime Retail Partnership Units may be
exchanged one share of Prime Retail Partnership Units for one share of common
stock, par value $0.01 per share ("PRIME RETAIL STOCK"), of Prime Retail, Inc.,
a Maryland corporation that has qualified for treatment as a real estate
investment trust ("PRIME RETAIL, INC.");
WHEREAS, pursuant to the Amended and Restated Agreement of Limited
Partnership of the Prime Group Realty Operating Partnership dated as of November
17, 1998 (as amended, modified or restated from time to time, the "PRIME GROUP
REALTY PARTNERSHIP AGREEMENT"), the Prime Group Realty Partnership Units may be
exchanged one unit of Prime Group Realty Partnership Units for one share of
common stock, par value $0.01 per share ("PRIME GROUP REALTY STOCK"), of Prime
Group Realty Trust, a Maryland corporation that has qualified for treatment as a
real estate investment trust ("PGRT");
WHEREAS, the Pledgor has agreed to grant the Pledgee a security
interest in the AIMCO Stock and the Brookdale Stock (collectively, the "PLEDGED
SHARES"), and the Prime Retail Partnership Units and the Prime Group Realty
Partnership Units (collectively, the "PLEDGED UNITS"), more fully described on
Schedule I.
NOW, THEREFORE, for good and valuable consideration, the receipt,
sufficiency and adequacy of which are hereby acknowledged, the Pledgor hereby
agrees as follows:
1. PLEDGE. The Pledgor hereby pledges to the Pledgee, and
grants to the Pledgee a security interest in, the following (the "PLEDGED
COLLATERAL"):
(a) the Pledged Shares now owned by the Pledgor and the
certificates, if any, representing such Pledged Shares, and all
dividends, cash, securities, instruments, rights and other property from
time to time received, receivable or otherwise distributed in respect of
or in exchange for any or all of such Pledged Shares;
(b) the Pledged Units now owned by the Pledgor and the
certificates, if any, representing such Pledged Units, the Pledgor's
interest in the capital, income, profits and distributions of the Prime
Retail Operating Partnership and the Prime Group Realty Operating
Partnership attributable to such Pledged Units, and all other cash,
securities, instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange for any
or all of the Pledged Units;
(c) all additional shares of Prime Securities and other
securities acquired by the Pledgor in any manner with respect to the
Pledged Shares and the Pledged Units (including, but not limited to,
Prime Retail Stock for which Prime Retail Partnership Units are
exchanged, and Prime Group Realty Shares for which Prime Group Realty
Partnership Units are exchanged), and the certificates, if any,
representing such additional securities (any such additional securities
shall constitute part of the Pledged Shares or the Pledged Units, as the
case may be, under and as defined in this Agreement), and all dividends,
cash, instruments, subscription warrants, securities and any other rights
and options and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of such
securities; and
(d) all other property hereafter delivered to the Pledgee in
substitution for, as proceeds of, or in addition to any of the foregoing
and all certificates, instruments and documents representing or
evidencing such property, and all cash, securities, interest, dividends,
rights and other property at any time and from time to time received,
receivable or otherwise distributed in respect of or in exchange for or
upon conversion of any or all thereof.
2. SECURITY FOR OBLIGATIONS. The Pledged Collateral secures the
payment of all of the Pledgor's "Borrower's Obligations", as such term is
defined in the Loan Agreement, to the Pledgee,
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whether for principal, interest, fees, expenses or otherwise, and all
obligations of the Pledgor now or hereafter existing under this Agreement (such
Borrower's Obligations under the Loan Agreement and all such obligations of the
Pledgor now or hereafter existing under this Agreement being referred to herein
as the "OBLIGATIONS").
3. DELIVERY OF PLEDGED COLLATERAL.
(a) All certificates, instruments or documents, if any,
representing or evidencing the Pledged Collateral shall be delivered to
and held by or on behalf of the Pledgee pursuant hereto and shall be in
suitable form for transfer by delivery, shall be accompanied by duly
executed instruments of transfer or assignment in blank, all in form and
substance satisfactory to the Pledgee. In the event any or all of the
Pledged Collateral are evidenced by a book entry, Pledgor shall execute
and deliver to Pledgee such documents as are required by Pledgee to
create and perfect a security interest in such uncertificated Pledged
Collateral. In addition, the Pledgee shall have the right at any time to
exchange certificates or instruments representing or evidencing Pledged
Collateral for certificates or instruments of smaller or larger
denominations.
(b) Pledgor shall, and shall cause other appropriate parties
under Section 8-313 and 8-321 of the Uniform Commercial Code as in effect
on the date hereof in the State of Illinois (the "CODE") to, xxxx it or
their books and records with the numbers and face amounts of all
uncertificated securities evidencing the Pledged Shares and/or the
Pledged Units, as applicable, and all rollovers and replacements therefor
to reflect the security interests granted pursuant to Section 2 hereof.
Pledgor shall provide Pledgee and shall cause other persons to provide
Pledgee with written confirmation of the security interest in such
uncertificated securities. Pledgor shall take, and shall cause all other
necessary persons to take, all action necessary or appropriate to create,
perfect and maintain a first perfected priority lien in such
uncertificated securities in favor of Pledgee. In the event that
subsequent to the date hereof, the Pledged Shares and/or Pledged Units,
as applicable, are evidenced by certificates, Pledgor will promptly
deliver such certificates to Pledgee, together with an assignment duly
endorsed in blank for transfer.
4. REPRESENTATIONS AND WARRANTIES. The Pledgor represents and
warrants as follows:
(a) The Brookdale Stock and the Pledged Units have been duly
authorized and validly issued and are fully paid and nonassessable. The
Prime Retail Stock to be issued upon the conversion of the Prime Retail
Partnership Units, and the Prime Group Realty Stock to be issued upon the
conversion of the Prime Group Realty Partnership Units, has been duly
authorized and will be, upon conversion, fully paid and nonassessable.
(b) The Pledgor is, or at the time of any future delivery,
pledge, assignment or transfer will be, the legal and beneficial owner of
the Pledged Collateral, free and clear of any lien, security interest,
pledge, warrant, option, purchase agreement, shareholders' agreement,
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restriction, redemption agreement or other charge, encumbrance or
restriction of any nature on the Pledged Collateral (except for the lien
created by this Agreement, the restrictions imposed by the agreements
listed on Schedule II hereto, completed copies of which have been
delivered to Pledgor, and the liens permitted by the Loan Agreement),
with full right to deliver, pledge, assign and transfer the Pledged
Collateral to the Pledgee as Pledged Collateral hereunder.
(c) The Brookdale Stock was acquired and fully paid for by an
affiliate of the Pledgor on ________________, ____ in a transaction
exempt from the registration provisions of the Securities Act of 1933, as
amended (the "SECURITIES ACT").
(d) The AIMCO Stock was acquired and fully paid for by an
affiliate of the Pledgor on ________________, ____ in a transaction
exempt from the registration provisions of the Securities Act.
(e) Subject to compliance with the agreements listed on
Schedule II hereto, the Pledged Units can be exchanged at any time at the
rate of one unit of Prime Retail Partnership Unit for one share of Prime
Retail Stock, and one unit of Prime Group Realty Partnership Unit for one
share of Prime Group Realty Stock.
(f) Upon (i) filing of the UCC financing statements, forms of
which are attached hereto as Exhibit A, with the Secretary of State of
Illinois and the Secretary of State of Maryland, (ii) execution and
delivery of the Acknowledgment and Consent, dated as of even date
herewith, among Pledgor, Prime Retail Operating Partnership, Prime
Retail, Inc. and Pledgee, (iii) execution and delivery of the
Acknowledgment and Consent, dated as of even date herewith, among
Pledgor, Prime Group Realty Operating Partnership, PGRT, Prudential
Securities Incorporated and Pledgee, and (iv) possession by Pledgee of
the certificates representing the Pledged Collateral, the pledge of the
Pledged Collateral pursuant to this Agreement will create a valid,
perfected and first security interest in the Pledged Collateral, securing
the payment of the Obligations. All other filings, registrations,
recordings and other actions necessary or desirable to create, perfect
and protect such security interest have been duly taken, and such
security interests are entitled to all of the rights, priorities and
benefits afforded by the Code or other relevant law as enacted in any
relevant jurisdiction which relates to perfected security interests.
(g) Except as otherwise set forth in paragraph (g) above, no
authorization, approval, or other action by, and no notice to or filing
with, any governmental authority or regulatory body is required either
(i) for the pledge by the Pledgor of the Pledged Collateral pursuant to
this Agreement or for the execution, delivery or performance of this
Agreement by the Pledgor, or (ii) for the exercise by the Pledgee of the
voting or other rights provided for in this Agreement or the remedies in
respect of the Pledged Collateral pursuant to this Agreement (except as
may be required in connection with a disposition of such Pledged
Collateral by laws affecting the offering and sale of securities
generally).
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(h) The Pledgor has full power and authority to enter into this
Agreement and has the right to pledge and grant a security interest in
the Pledged Collateral as provided by this Agreement.
5. FURTHER ASSISTANCE. The Pledgor agrees that at any time and from
time to time, at the expense of the Pledgor, the Pledgor will promptly execute
and deliver, or cause to be executed and delivered, all certificates, stock
powers, proxies, assignments, instruments and documents; and will take all
further action that may be reasonably necessary or desirable, or that the
Pledgee may reasonably request, in order to perfect and protect any security
interest granted or purported to be granted hereby or to enable the Pledgee to
exercise and enforce its rights and remedies hereunder with respect to any
Pledged Collateral and to carry out the provisions and purposes hereof.
6. VOTING RIGHTS; DIVIDENDS; ETC.
(a) Except as set forth below, so long as no Event of Default
(as hereinafter defined):
(i) The Pledgor shall be entitled to exercise any and
all voting and other consensual rights pertaining to the Pledged
Collateral or any part thereof for any purpose not inconsistent
with the terms of this Agreement or the Loan Agreement; PROVIDED,
HOWEVER, that the Pledgor shall not exercise nor shall it refrain
from exercising any such right if such action or inaction could
have a material adverse effect on the value of the Pledged
Collateral or upon the rights of the Pledgee to effectively
realize upon the security afforded by such Pledged Collateral.
(ii) The Pledgor shall be entitled to receive and retain
any and all dividends and interest paid in respect of the Pledged
Shares and all distributions paid in respect of the Pledged Units,
PROVIDED HOWEVER, that any and all
(1) dividends, interest and distributions paid or
payable other than in cash in respect of, and
instruments and other property received, receivable
or otherwise distributed in respect of, or in
exchange for, any Pledged Collateral,
(2) dividends and other distributions paid or payable in
cash in respect of any Pledged Collateral in
connection with a partial or total liquidation or
dissolution or in connection with a reduction of
capital, capital surplus or paid-in-surplus
resulting from a sale or refinancing of any
property, and
(3) cash paid, payable or otherwise distributed in
redemption of, or in exchange for, any Pledged
Collateral,
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shall be Pledged Collateral, shall be forthwith delivered to the
Pledgee to hold as Pledged Collateral and shall, if received by
the Pledgor, be received in trust for the benefit of the Pledgee,
be segregated from the other property or funds of the Pledgor, and
be forthwith delivered to the Pledgee as Pledged Collateral in the
same form as so received (with any necessary endorsement).
(b) Except as set forth below, upon the occurrence (and during
the continuance) of an Event of Default (as hereinafter defined):
(i) All rights of the Pledgor to exercise the voting and
other consensual rights which it would otherwise be entitled to
exercise pursuant to Section 6(a)(i) (but only after an Event of
Default) and to receive the dividends and interest payments and
distributions which it would otherwise be authorized to receive
and retain pursuant to Section 6(a)(ii) shall cease, and all such
rights shall thereupon become vested in the Pledgee which shall
thereupon have the sole right to exercise such voting and other
consensual rights and to receive and hold as Pledged Collateral
such dividends and interest payments and distributions;
(ii) All dividends and interest payments and
distributions which are received by the Pledgor contrary to the
provisions of paragraph (i) of this Section 6(b) shall be received
in trust for the benefit of the Pledgee, shall be segregated from
other funds of the Pledgor and shall be forthwith paid over to the
Pledgee as Pledged Collateral in the same form as so received
(with any necessary endorsements); and
(iii) The Pledgor shall execute and deliver (or cause to
be executed and delivered) to the Pledgee all such proxies and
other instruments as the Pledgee may (reasonably) request for the
purpose of enabling the Pledgee to exercise the voting and other
rights which it is entitled to exercise pursuant to paragraph (i)
above and to receive the dividends or interest payments or
distribution which it is authorized to receive pursuant to
paragraph (ii) above.
7. TRANSFERS AND OTHER LIENS; ADDITIONAL SHARES. The Pledgor
agrees that it will not (i) sell, assign, transfer, convey, exchange, pledge,
hypothecate or otherwise dispose of, or grant any option, warrant, right,
contract or commitment with respect to, any of the Pledged Collateral without
the prior written consent of the Pledgee, or (ii) create or permit to exist any
lien, security interest, pledge, proxy, purchase arrangement, restriction,
redemption agreements, shareholders' agreement or other charge or encumbrance
upon or with respect to any of the Pledged Collateral, except for the lien
created by this Agreement, restrictions imposed by the agreements listed on
Schedule II hereto and liens permitted by the Loan Agreement.
8. APPLICATION OF PROCEEDS OF SALE OR CASH HELD AS COLLATERAL. All
proceeds from the sale of Pledged Collateral sold pursuant to this Agreement
and/or the cash held as Pledged
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Collateral hereunder shall be (a) retained by the Pledgee as cash collateral
for the Obligations, or (b) at the election of the Pledgee, applied by the
Pledgee as follows:
FIRST: to payment of the costs and expenses of such sale,
including the out-of-pocket expenses of the Pledgee, including the reasonable
fees and out-of-pocket expenses of counsel employed in connection therewith, and
to the payment of all advances made by the Pledgee for the account of the
Pledgor hereunder, and the payment of all costs and expenses incurred by the
Pledgee in connection with the administration and enforcement of this Agreement,
to the extent that such advances, costs and expenses shall not have been
reimbursed to the Pledgee;
SECOND: to the payment of interest accrued and unpaid, if
any, on any of the Obligations to and including the date of such application and
then to the payment or prepayment of principal of any of the Obligations and
then to the payment of the balance of the Obligations in such order as Pledgee
may determine in its sole discretion; and
THIRD: the balance, if any, of such proceeds shall be paid
to the Pledgor, or its successors or assigns, or as a court of competent
jurisdiction may direct.
9. THE PLEDGEE APPOINTED ATTORNEY-IN-FACT. The Pledgor hereby
appoints the Pledgee as the Pledgor's attorney-in-fact, with full authority in
the place and stead of the Pledgor and in the name of the Pledgor or otherwise,
from time to time after giving notice to Pledgee in the Pledgee's discretion to
take any action and to execute any instrument which the Pledgee may deem
necessary or advisable to accomplish the purposes of this Agreement, including,
without limitation, (i) to receive, endorse and collect all instruments made
payable to the Pledgor representing any dividend, interest payment or other
distribution in respect of the Pledged Collateral or any part thereof and to
give full discharge for the same and (ii) to exercise all rights, including
conversion rights, with respect to such Pledged Collateral.
10. THE PLEDGEE MAY PERFORM. If the Pledgor fails to perform any
agreement contained herein, the Pledgee may itself perform, or cause performance
of, such agreement, and the reasonable expenses of the Pledgee incurred in
connection therewith shall be payable by the Pledgor under Section 17.
11. REASONABLE CARE. The Pledgee shall be deemed to have exercised
reasonable care in the custody and preservation of the Pledged Collateral in its
possession if the Pledged Collateral is accorded treatment substantially equal
to that which the Pledgee accords its own property, it being understood that the
Pledgee shall not have any responsibility for (i) ascertaining or taking action
with respect to calls, conversions, exchanges, maturities, tenders or other
matters relative to any Pledged Collateral, whether or not the Pledgee has or is
deemed to have knowledge of such matters, or (ii) taking any necessary steps to
preserve rights against any parties with respect to any Pledged Collateral;
PROVIDED, HOWEVER, that upon the Pledgor's instruction, the Pledgee shall use
reasonable efforts to take such action as the Pledgor directs the Pledgee to
take with respect to calls, conversions, exchanges, maturities, tenders, rights
against other parties or other similar matters
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relative to the Pledged Collateral, but failure of the Pledgee to comply with
any such request shall not of itself be deemed a failure to exercise reasonable
care, and no failure of the Pledgee to preserve or protect any rights with
respect to the Pledged Collateral against prior parties, or to do any act with
respect to preservation of the Pledged Collateral not so requested by the
Pledgor, shall be deemed a failure to exercise reasonable care in the custody or
preservation of the Pledged Collateral.
12. SUBSEQUENT CHANGES AFFECTING COLLATERAL. The Pledgor represents
to the Pledgee that the Pledgor has made its own arrangements for keeping
informed of changes or potential changes affecting the Pledged Collateral
(including, but not limited to, rights to convert, rights to subscribe, payment
of dividends or distributions, reorganization or other exchanges, tender offers
and voting rights), and the Pledgor agrees that the Pledgee shall have no
responsibility or liability for informing the Pledgor of any such changes or
potential changes or for taking any action or omitting to take any action with
respect thereto.
13. EVENTS OF DEFAULT; REMEDIES UPON AN EVENT OF DEFAULT.
(a) The occurrence of any one or more of the following events
shall constitute an "EVENT OF DEFAULT" by Pledgor under this Agreement:
(i) there occurs (and is continuing) an Event of Default
under and as defined in the Loan Agreement;
(ii) the Pledged Shares and the Pledged Units shall not
be exchangeable for shares of Prime Retail Stock or Prime Group
Realty Stock as set forth in (and subject to the conditions in
Section 4(e) hereof.
(iii) the Pledgor fails to perform or observe any material
term, covenant (after 5 day written notice) or agreement contained
in this Agreement on its part to be performed or observed, or any
representation or warranty made by the Pledgor in this Agreement
shall be untrue or misleading in any material respect as of the
date with respect to which such representation or warranty was
made;
(iv) a notice of lien, levy or assessment is filed or
recorded with respect to all or a substantial part of the Pledged
Collateral, and such lien, levy or assessment is not released,
discharged or removed within thirty (30) days from the date it is
filed or recorded, except for a lien, levy or assessment which
relates to current taxes not yet due and payable or a lien
permitted by the Loan Agreement; and
(v) all or a substantial part of the Pledged Collateral
is attached, seized, subjected to a writ or distress warrant, or
is levied upon, or comes within the possession of any receiver,
trustee, custodian or assignee for the benefit of creditors.
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(b) If any Event of Default shall have occurred (and be
continuing), the Pledgee shall have, in addition to all other rights
given by law or by this Agreement, the Loan Agreement or otherwise, all
of the rights and remedies with respect to the Pledged Collateral of a
secured party under the Code in effect in the State of Illinois at that
time, and the Pledgee may, without notice and at its option, transfer or
register the Pledged Collateral or any part thereof on the books of the
issuer thereof into the name of the Pledgee or the Pledgee's nominee(s),
with or without any indication that such Pledged Collateral is subject to
the security interest hereunder. In addition, with respect to any
Pledged Collateral which shall then be in or shall thereafter come into
the possession or custody of the Pledgee, the Pledgee may sell or cause
the same to be sold at any broker's board or at public or private sale,
in one or more sales or lots, at such price or prices as the Pledgee may
deem best, for cash or on credit or for future delivery, without
assumption of any credit risk. The purchaser of any or all Pledged
Collateral so sold shall thereafter hold the same absolutely, free from
any claim, encumbrance or right of any kind whatsoever, except for
claims, encumbrances or rights that may arise without the knowledge or
consent of the Pledgor. Unless any of the Pledged Collateral threatens
to decline speedily in value or is or becomes of a type sold on a
recognized market, the Pledgee will give the Pledgor reasonable notice of
the time and place of any public sale thereof, or of the time after which
any private sale or other intended disposition is to be made. Any sale
of the Pledged Collateral conducted in conformity with reasonable
commercial practices of banks, insurance companies, commercial finance
companies, or other financial institutions disposing of property similar
to the Pledged Collateral shall be deemed to be commercially reasonable.
Any requirements of reasonable notice shall be met if such notice is
mailed to the Pledgor as provided in Section 20 below, at least five (5)
days before the time of the sale or disposition. Any other requirement
of notice, demand or advertisement for sale is, to the extent permitted
by law, waived. The Pledgee may, in its own name or in the name of a
designee or nominee, buy any of the Pledged Collateral at any public sale
and, if permitted by applicable law, at any private sale. All expenses
(including court costs and reasonable attorneys' fees and expenses) of,
or incident to, the enforcement of any of the provisions hereof shall be
recoverable from the proceeds of the sale or other disposition of Pledged
Collateral. In view of the fact that federal and state securities laws
may impose certain restrictions on the method by which a sale of the
Pledged Collateral may be effected after an Event of Default, the Pledgor
agrees that upon the occurrence or existence of any Event of Default, the
Pledgee may, from time to time, attempt to sell all or any part of the
Pledged Collateral by means of a private placement, restricting the
prospective purchasers to those who can make the representations and
agreements required of purchasers of securities in private placements.
In so doing, the Pledgee may solicit offers to buy the Pledged
Collateral, or any part of it, for cash, from a limited number of
investors deemed by the Pledgee in its judgment, to be responsible
parties who might be interested in purchasing the Pledged Collateral, and
if the Pledgee solicits such offers from not less than three (3) such
investors, then the acceptance by the Pledgee of the highest offer
obtained therefrom shall be deemed to be a commercially reasonable method
of disposition of the Pledged Collateral.
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In addition, upon the occurrence (and during the continuance) of
an Event of Default, all rights of the Pledgor to exercise the voting and
other rights which it would otherwise be entitled to exercise and to
receive cash dividends and interest payments, shall cease, and all such
rights shall thereupon become vested in the Pledgee as provided in
Section 6.
14. SECURITIES LAWS. Pledgor hereby acknowledges and confirms that
Pledgee may be unable to effect a public sale of any or all of the Pledged
Shares and the Pledged Units by reason of certain prohibitions contained in the
Securities Act and applicable state securities laws and may be compelled to
resort to one or more private sales thereof to a restricted group of purchasers
who will be obligated to agree, among other things, to acquire any of the
Pledged Shares and Pledged Units for their own respective accounts for
investment and not with the view to the distribution or resale thereof. Pledgor
further acknowledges and confirms that any such private sale may result in
prices or other terms less favorable to the seller than if such sale were a
public sale and, notwithstanding such circumstances, agrees that any such
private sale shall be deemed to have been made in a commercially reasonable
manner, and the Pledgee shall be under no obligation to take any steps in order
to permit the Pledged Shares and Pledged Units to be sold at a public sale. The
Pledgee shall be under no obligation to delay a sale of any of the Pledged
Shares and Pledged Units for any period of time necessary to permit any issuer
thereof to register such Pledged Shares and Pledged Units for public sale under
the Securities Act or under applicable state securities laws.
15. AUTHORITY OF THE PLEDGEE. The Pledgee shall have and be entitled
to exercise all such powers hereunder as are specifically delegated to the
Pledgee by the terms hereof, together with such powers as are incidental
thereto. The Pledgee may execute any of its duties hereunder by or through
agents or employees. Neither the Pledgee, nor any director, officer, agent or
employee of the Pledgee, shall be liable for any action taken or omitted to be
taken by it or them hereunder or in connection herewith, except for its or their
own gross negligence or willful misconduct. The Pledgor hereby agrees to
indemnify and hold harmless the Pledgee and/or any such director, officer, agent
or employee from and against any and all liability incurred by any of them,
hereunder or in connection herewith, unless such liability shall be due to its
or their own gross negligence or willful misconduct.
16. TERMINATION. This Agreement shall terminate after the time when
all the Obligations have been fully paid and performed, at which time the
Pledgee shall reassign and redeliver (or cause to be reassigned and redelivered)
to the Pledgor, or to such person or persons as the Pledgor shall designate,
against receipt, such of the Pledged Collateral (if any) as shall not have been
sold or otherwise applied by the Pledgee pursuant to the terms hereof and shall
still be held by it hereunder, together with appropriate instruments of
reassignment and release. Any such reassignment shall be without recourse upon
or warranty by the Pledgee and at the expense of the Pledgor.
17. EXPENSES. The Pledgor agrees to reimburse the Pledgee promptly
after demand for any and all reasonable expenses, including the reasonable fees
and expenses of its counsel and of any experts and agents, which the Pledgee may
incur in connection with (i) the administration of this Agreement, (ii) the
custody or preservation of, or the registration of the Pledged Collateral, (iii)
the
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exercise or enforcement of any of the rights of the Pledgee hereunder, or
(iv) the failure by the Pledgor to perform or observe any of the provisions
hereof.
18. SECURITY INTEREST ABSOLUTE. All rights of the Pledgee and
security interests hereunder, and all obligations of the Pledgor hereunder,
shall be absolute and unconditional irrespective of:
(i) any lack of validity or enforceability of the Loan
Agreement or any other agreement or instrument relating thereto;
(ii) any change in the time, manner or place of payment
of, or in any other term of, all or any of the Obligations, or any
other amendment or waiver of or any consent to any departure from
the Loan Agreement;
(iii) any exchange, surrender, release or non-perfection
of any other collateral, or any release or amendment or waiver of
or consent to departure from any guaranty, for all or any of the
Obligations; or
(iv) any other circumstance which might otherwise
constitute a defense available to, or a discharge of, the Pledgor
in respect of the Obligations or of this Agreement.
19. AMENDMENTS, WAIVERS AND CONSENTS. No amendment or waiver of any
provision of this Agreement nor consent to any departure by the Pledgor
herefrom, shall in any event be effective unless the same shall be in writing
and signed by the Pledgee, and then such amendment, waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.
20. NOTICES. Any notice required or desired to be served, given or
delivered hereunder shall be in writing (including facsimile transmission), and
shall be deemed to have been validly served, given or delivered upon the earlier
of (a) personal delivery to the address set forth below (b) in the case of
mailed notice, two (2) days after deposit in the United States mails, with
proper postage for certified mail, return receipt requested, prepaid, or in the
case of notice by Federal Express or other reputable overnight courier service,
one (1) day after delivery to such courier service, and (c) in the case of
facsimile transmission, upon transmission with confirmation of receipt,
addressed to the party to be notified as follows:
If to the Pledgor: Prime Group VI, L.P.
c/o The Prime Group, Inc.
00 Xxxx Xxxxxx Xxxxx
Xxxxx 0000 (Suite 4200 after February 1, 1999)
Attn: Xxxxxxx X. Xxxxxxx
Facsimile Number: (000)000-0000
11
With a copies to: Winston & Xxxxxx
00 Xxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxx, Esq.
Facsimile Number: (000)000-0000
And to: The Prime Group, Inc.
00 Xxxx Xxxxxx Xxxxx
Xxxxx 0000
Attn: Xxxxxx X. Xxxxxx, Esq.
Facsimile Number: (000)000-0000
If to the Pledgee: LaSalle National Bank
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxx
Facsimile Number: (000) 000-0000
With a copy to: Schwartz, Cooper, Xxxxxxxxxxx & Xxxxxx, Chartered
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Facsimile Number: (000) 000-0000
or to such other address as any of the parties may hereafter designate for
itself by written notice to the other parties in the manner herein prescribed.
21. CONTINUING SECURITY INTEREST. This Agreement shall create a
continuing security interest in the Pledged Collateral and shall (i) be binding
upon the Pledgor, its successors and assigns, and (ii) inure to the benefit of
the Pledgee and its successors, transferees and assigns.
22. WAIVERS. To the extent permitted by applicable law, the Pledgor
waives presentment and demand for payment of any of the Obligations, protest and
notice of dishonor or default with respect to any of the Obligations, and all
other notices to which the Pledgor might otherwise be entitled, except as
otherwise expressly provided herein or in the Loan Agreement.
23. WAIVER OF JURY TRIAL. The Pledgor and the Pledgee each hereby
waive any right to a trial by jury in any action or proceeding to enforce or
defend any rights under this Agreement or any amendment, instrument, document or
agreement delivered or which may in the future be delivered in connection
herewith or arising from any banking relationship existing in connection with
this Agreement, and agrees that any such action or proceeding shall be tried
before a court and not before a jury.
12
24. GOVERNING LAW; TERMS. This Agreement shall be governed by and
construed in accordance with the internal laws (as opposed to conflict of laws
provisions) and decisions of the State of Illinois. Unless otherwise defined
herein, terms defined in Articles 3, 8 and 9 of the Code are used herein as
therein defined. Whenever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but, if any provision of this Agreement shall be interpreted in such manner as
to be ineffective or invalid under applicable law, such provisions shall be
ineffective or invalid only to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining provisions
of this Agreement.
25. DEFINITIONS. The singular shall include the plural and vice versa
and any gender shall include any other gender as the text shall indicate.
26. SECTION HEADINGS. The section headings herein are for convenience
of reference only, and shall not affect in any way the interpretation of any of
the provisions hereof.
27. NON-RECOURSE. The non-recourse provisions set forth in Section
11.5 of the Loan Agreement are incorporated in this Agreement by reference as if
fully set forth herein.
[BALANCE OF PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGE FOLLOWS.]
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IN WITNESS WHEREOF, the Pledgor and the Pledgee have each caused this
Pledge Agreement to be duly executed and delivered by its officer, if any,
thereunto duly authorized as of the date first above written.
PRIME GROUP VI, L.P., an Illinois
limited partnership
By: PGLP, Inc., an Illinois
corporation, as managing
general partner
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------
Its: Vice President
-------------------------
LASALLE NATIONAL BANK, a national
banking association
By: /s/ Xxxx X. Xxxx
-------------------------------------
Its: First VP
-------------------------------
SCHEDULE I
DESCRIPTION OF PLEDGED COLLATERAL
A. PLEDGED SHARES
Issuer Certificate No. Shares
------ --------------- ------
Brookdale Living Communities, Inc. 3,576,933
Apartment Investment
and Management Company 115,000
B. PLEDGED UNITS
104,632 units of limited partnership interests in Prime Retail, L.P.,
a Delaware limited partnership, as evidenced by certificate number
____________
47,525 units of limited partnership interests in Prime Group Realty,
L.P., a Delaware limited partnership, as evidenced by certificate number
____________
SCHEDULE II
OTHER AGREEMENTS
1. Registration Rights Agreement dated as of November 17, 1997
by and among Prime Group Realty Trust, Prime Group Realty,
L.P., Prime Group Limited Partnership, Primestone
Investment Partners L.P. and the other investors named
therein.
2. Registration Rights Agreement dated as of June 15, 1998 by
and among Prime Retail, Inc., Prime Retail, L.P. and the
other investors named therein.
3. Prime Retail Partnership Agreement.
4. Prime Group Realty Partnership Agreement.
5. Lock-Up Agreement, dated November 11, 1997, from Prime Group
Limited Partnership to Prudential Securities Incorporated,
Friedman, Billings, Xxxxxx & Co., Inc., Xxxxx Xxxxxx Inc. and
Xxxxxx Xxxxxx & Company, Inc.
