EXHIBIT 10.13
LOAN AGREEMENT
BRE/CITY CENTER L.L.C., BORROWER
CORUS BANK, N.A., LENDER
APRIL 25, 2001
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NOTE: THE TERMS OF THIS LOAN AGREEMENT ARE SUBJECT TO A CERTIFICATE AND
AGREEMENT WITH FLEET NATIONAL BANK, REQUIRING LENDER TO DELIVER CERTAIN NOTICES
AND AGREEMENTS TO FLEET NATIONAL BANK.
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LOAN AGREEMENT
BRE/CITY CENTER L.L.C.
THIS LOAN AGREEMENT (this "Agreement") is dated for reference purposes only
as of April 25, 2001, by and between BRE/City Center L.L.C., a Delaware limited
liability company, ("Borrower") which has its principal place of business at c/o
Prime Group Realty Trust, 00 Xxxx Xxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx XX 00000 and
CORUS BANK, N.A., a national banking association, whose address is 0000 X.
Xxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, Attention: Xxxx X. Xxxxxxxxx, First
Vice President ("Lender").
RECITALS:
A. Borrower has requested that Lender make a loan to Borrower in the
original principal amount of Sixty Seven Million and No/100 Dollars
($67,000,000) (the "Loan") to be used to refinance an existing loan on property
improved with a 35-story office building, a 4-story connecting annex building
and an adjacent 7-level parking garage, legally described on Exhibit A and
commonly known as National City Center, 0000 Xxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxx
(the "Property").
B. Lender and Borrower have agreed that it is in their mutual best interest
to enter into this Agreement to set forth their mutual agreements with respect
to the Loan.
NOW, THEREFORE, in consideration of the mutual covenants made herein, and
other valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Borrower and Lender hereby agree as follows:
1. Recitals and Exhibits.
1.1. Incorporation of Recitals. The Recitals, including all definitions set
forth therein, are hereby incorporated in and expressly made a part of this
Agreement.
1.2. Incorporation of Exhibits. All Exhibits and Schedules attached hereto,
as amended from time to time in accordance with the provisions hereof, are
incorporated in and expressly made a part of this Agreement.
1.3. Rules of Construction. In this Agreement, unless a clear contrary
intention appears:
(a) the singular number includes the plural number and vice versa;
reference to any gender includes each other gender;
(b) the words "herein", "hereof' and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section or other subdivision;
(c) reference to any Person (defined below) includes such Person's
successors and assigns but, if applicable, only if such successors and
assigns are permitted by this Agreement, and reference to a Person in a
particular capacity excludes such Person in any other capacity or
individually; provided that nothing in this clause is intended to authorize
any assignment not otherwise permitted by this Agreement;
(d) reference to any agreement, document or instrument means such
agreement, document or instrument as amended, supplemented or modified and
in effect from time to time in accordance with the terms thereof and, if
applicable, the terms hereof, and reference to any note includes any note
issued pursuant to any Loan Document or any extension, modification or
renewal thereof and in substitution or replacement therefor;
(e) unless the context indicates otherwise, reference to any Article,
Section, Schedule or Exhibit means such Article or Section hereof or such
Schedule or Exhibit hereto;
(f) the words "including" (and with correlative meaning "include")
means including, without limiting the generality of any description
preceding such term;
(g) with respect to the determination of any period of time, the word
"from" means "from and including" and the word "to" means "to but
excluding";
(h) reference to any law means such as amended, modified, codified or
reenacted, in whole or in part, and in effect from time to time;
(i) the Article and Section headings herein are for convenience only
and shall not affect the construction hereof;
(j) each reference herein that an event is an "Event of Default" shall
be deemed to mean an immediate Event of Default, without any obligation of
notice or cure, unless specifically provided for in the applicable Section.
(k) As used herein the phrase "to Borrower's knowledge", "known to
Borrower", or "knowledge of Borrower", or words of such import shall mean
all actual knowledge of Xxxxx X. Xxxxxxxx, Xxxxxx X. Xxxxxx, Xxxxx Xxxxx
and Xxxxxxx X. Xxxxx, after reasonable and diligent inquiry, including
inquiry of the officers, directors, members and managers of Borrower and/or
Guarantor (defined below) having direct authority or responsibility for the
Property and the transactions contemplated herein.
2. Definition.
2.1. In addition to terms defined elsewhere in this Agreement, the
following terms shall have the following meanings:
2.2. "ADA Work": the definition ascribed to this term in Section 5.19.
2.3. "Adjustment Date": the definition ascribed to this term in Section
4.2(b).
2.4. "Applicable Percentage": the definition ascribed to such term in
Section 4.2(a).
2.5. "Approved Lease": the definition ascribed to this term in Section 7.2
together with amendments to such Approved Lease which are made in accordance
with the terms of this Agreement.
2.6. "Award": the definition ascribed to this term in Section 6.6.
2.7. "Business Day": any day which is not a Saturday, Sunday or other legal
holiday on which the Lender is open for business.
2.8. "Charges": all national, Federal, state, county, city, municipal
and/or other governmental (or any instrumentality, division, agency, body or
department thereof, including without limitation the Pension Benefit Guaranty
Corporation) taxes, levies, assessments, charges, liens, claims or encumbrances
upon and/or relating to the Borrower's assets, the Secured Obligations,
Borrower's business, Borrower's ownership and/or use of any of its assets,
Borrower's income and/or gross receipts and/or Borrower's ownership and/or use
of the Property.
2.9. "Closing Date": April 27, 2001, the date of execution of this
Agreement by Borrower and Lender.
2.10. "Collateral": the Property and any and all other property (real,
personal or intangible) in which a security interest has been granted by
Borrower to Lender to secure the Secured Obligations.
2.11. "Commitment Letter": that certain commitment letter and acceptance
thereof dated April 24, 2001 by and between Borrower and Lender relating to the
Loan.
2.12. "Costs": any and all reasonable, actual, out-of-pocket costs and
expenses incurred by Lender at any time, in connection with: (i) the
preparation, negotiation, execution and administration of this Agreement and all
other Loan Documents; (ii) the preparation, negotiation and execution of any
Modification of this Agreement or any other Loan Document; (iii) the custody,
preservation, use, operation, or the sale of, collection from or other
realization upon the Collateral, including any protective advance; (iv) the
exercise or enforcement of any of the rights of Lender under this Agreement or
any other Loan Document; (v) any failure or alleged failure by Borrower to
perform or observe any of the provisions of this Agreement or any other Loan
Document; (vi) any litigation, contest, dispute, suit, proceeding or action
(whether instituted by Lender, Borrower or any other Person naming Lender as a
party) in any way relating to this Agreement, the other Loan Documents, the
Secured Obligations, the Collateral, Borrower's affairs or any other Loan
Party's affairs relating to the Loan Documents or the Collateral or the
transactions contemplated herein; (vii) any consultation required by Lender, in
its reasonable discretion between Lender and its accountants, attorneys or
agents relating to the provisions of this Agreement or any other Loan Document
and the performance by Borrower or Guarantor under this Agreement or any other
Loan Document; (viii) any evaluation or appraisal of the Collateral reasonably
obtained by Lender, following the occurrence and continuance of an Event of
Default or written notice of default by Lender to Borrower; (ix) any good faith
attempt to enforce any rights of Lender against Borrower or any other Person
which may be obligated to Lender by virtue of this Agreement or any other Loan
Document; (x) performing in good faith any of the obligations relating to or
payment of any of Borrower's liabilities or Borrower's obligations to Lender or
to third parties, including without limitation the performance of any obligation
of Borrower or Guarantor under the terms of any other Loan Document or any
agreement relating thereto; (xi) amounts necessary or appropriate to protect the
lien or priority of the Mortgage or of any of the other Loan Documents or to
pay, settle, compromise or contest any lien or claim of lien against the
Collateral or any part thereof, including any amount paid with respect to any
Imposition, Charge, or any other tax or assessment, whether or not a lien upon
the Property; (xii) the payment or performance of any of the obligations of
Borrower set forth in this Agreement or any of the other Loan Documents; and
(xiii) all loan fees, extension fees, commitment fees, closing fees, letter of
credit fees and other fees due from Borrower to Lender, in accordance with the
provisions of this Agreement or any other Loan Document, including but not
limited to fees due pursuant to Article 8 of this Agreement. As used in this
Agreement and every other Loan Document, Costs shall include, but not limited
to, reasonable out-of-pocket fees and expenses of: (1) any attorneys of Lender,
including, but not limited to fees of any law firm retained by Lender, Lender's
in-house counsel, paralegal and their respective expenses; (2) accountants,
appraisers, inspectors, consultants, insurance review fees, environmental
assessments fees, environmental assessments obtained in accordance with the
Environmental Indemnity Agreement, engineering fees, architect's fees, standard
flood hazard determinations, or other professional; (3) recording fees, filing
charges, escrow charges, title charges, title insurance premiums, casualty and
liability insurance premiums, costs of surveys and bonds; (4) travel expenses,
and related expenses; (5) court costs; (6) processing fees and broker's fees,
and (7) all other fees and expenses of Lender referred to or necessitated by the
terms of this Agreement, the performance hereof or the construction and
management of the Property. Fees for in-house counsel shall be based upon the
fees of mid-sized law firms in the City of Chicago, for attorney's of comparable
experience and expertise. Lender and Borrower hereby agree that Borrower shall
not be liable for any Costs attributable to the negotiation and execution of any
document, agreement or instrument entered into by Lender after the Closing Date
and at any time prior to the occurrence of an Event of Default, in connection
with the sale or transfer of any interest (including participation interests) in
the Loan; provided that this exclusion shall not apply to Costs incurred prior
to or on the Closing Date relating to the sale of a participation interest to
Corus Bankshares, Inc.
2.13. "Current Estoppels": the meaning ascribed to this term in Section
7.1(a).
2.14. "Default Rate": an annual rate of interest equal to four percent (4%)
plus the Interest Rate then in effect under the Note or this Agreement, as
adjusted from time to time on each Adjustment Date.
2.15. "Distribution": the declaration or payment of any dividend or
distribution on or in respect of any shares of any class of capital stock of any
Person or any distribution of cash or cash flow in respect of any partnership,
membership or other ownership interest in any Person, other than dividends
payable solely in shares of common stock of such Person; or the purchase,
redemption, or other retirement of any shares of any class stock or ownership
interest of any Person or ownership interests in such Person, directly or
indirectly through a subsidiary (of any tier) or otherwise, the making of any
loans to any shareholder, member, constituent partner or affiliate; the return
of capital by any Person to its shareholders, members or partners as such; or
any other distribution on or in respect of any shares of any class of capital
stock or ownership interest of any Person or any partnership, membership or
other ownership interest in any Person.
2.16. "Easement Parcel": that certain easement legally described as Parcel
3 on Exhibit A attached hereto.
2.17. "Environmental Laws": the definition ascribed to this term in the
Environmental indemnity Agreement by Borrower in favor of Lender dated even date
herewith, which definition is incorporated herein by reference.
2.18. "Event of Default": the definition ascribed to this term in Article
10.
2.19. "Existing Leases": those leases identified on Schedule 7.1, as
amended from time to time in accordance with the terms of the Agreement.
2.20. "Exit Fee": the definition ascribed to this term in Section 8.1(b).
2.21. "GAAP": means generally accepted accounting principles applied in the
preparation of the financial statements of a Person with such changes thereto as
(i) shall be consistent with the then-effective principles promulgated or
adopted by the Financial Accounting Standards Board and its predecessors and
successors and (ii) shall be concurred in by the independent certified public
accountants of recognized standing reasonably acceptable to Lender reviewing
such financial statements of Borrower.
2.22. "Governmental Authority": the various governmental or
quasi-governmental bodies or agencies having jurisdiction over Borrower,
Guarantor, the Property, or any portion thereof, or the use, occupancy,
development or operation thereof.
2.23. "Ground Lease": the meaning ascribed to this term in Section 3.10(a).
2.24. "Guarantor": collectively PGR and any other party who guarantees all
or a portion of the Secured Obligations.
2.25. "Guaranty Agreement": that certain Limited Guaranty, dated even date
herewith, delivered by PGR to Lender.
2.26. "Guaranty Equivalent": any agreement, document or instrument pursuant
to which a Person directly or indirectly guarantees, becomes surety for,
endorses, assumes, agrees to indemnify the obligee of any other Person against,
or otherwise agrees, becomes or remains liable (contingently or otherwise) for,
such other Person's obligation, other than by endorsements of instruments in the
ordinary course of business. Without limitation, a Guaranty Equivalent shall be
deemed to exist if a Person agrees, becomes or remains liable (contingently or
otherwise), directly or indirectly for the benefit of another Person: (i) to
purchase or assume, or to supply funds for the payment, purchase or satisfaction
of, an obligation; (ii) to make any loan, advance, capital contribution or other
investment in, or a purchase or lease of any property or services from, a
Person; (iii) to maintain the solvency of such Person; (iv) to enable such
Person to meet any other financial condition; (v) to enable such Person to
satisfy any obligation or to make any payment; (vi) to assure the holder of an
obligation against loss; (vii) to purchase or lease property or services from
such Person regardless of the non-delivery of or failure to furnish of such
property or services; or (viii) in respect of any other transaction the effect
of which is to assure the payment or performance (or payment of damages or other
remedy in the event of nonpayment or nonperformance) of any obligation.
2.27. "Hazardous Materials": the definition ascribed in this term in the
Environmental Indemnity Agreement, delivered by Borrower and PGR to Lender
concurrently herewith, which definition is incorporated herein by reference.
2.28. "Imposition": the definition ascribed to this term in Section
5.17(a).
2.29. "Indebtedness": with respect to any Person, at a particular time
(without duplication): (i) all obligations on account of money borrowed by, or
credit extended to or on behalf of, or for or on account of deposits with or
advances to, such Person; (ii) all obligations of such Person evidenced by
bonds, debentures, notes or similar instruments; (iii) all obligations of such
Person for the deferred purchase price of property or services other than trade
payables incurred in the ordinary course of business and on terms customary in
the trade; (iv) all obligations secured by a lien on property owned by such
Person (whether or not assumed); and all obligations of such Person under
capitalized leases (without regard to any limitation of the rights and remedies
of the holder of such lien or the lessor under such capitalized lease to
repossession or sale of such property); (v) the face amount of all letters of
credit issued for the account of such Person and, without duplication, the
unreimbursed amount of all drafts drawn thereunder, and all other obligations of
such Person associated with such letters of credit or draws thereon; (vi) all
obligations of such Person in respect of acceptances or similar obligations
issued for the account of such Person; (vii) all obligations of such Person
under a product financing or similar arrangement; (viii) all obligations of such
Person under any interest rate or currency protection agreement, interest rate
or currency future, interest rate or currency option, interest rate or currency
swap or cap or other interest rate or currency hedge agreement; (ix) all
Guaranty Equivalents of such Person; and all obligations and liabilities with
respect to unfunded vested benefits under any "employee benefit plan" or with
respect to withdrawal liabilities incurred under ERISA by Borrower or any ERISA
Affiliate to a "multiemployer plan", as such terms are defined under the
Employee Retirement Income Security Act of 1974.
2.30. "Interest Rate": the definition ascribed to this term in Section
4.2(a).
2.31. "Laws": all laws, statutes, ordinances, rules, decrees, judgments,
orders, and/or regulations of any kind whatsoever, (including without limitation
those relating to building, zoning, health, safety, life code, environmental
protection, access, environmental barriers, public highway and public access)
and specifically including without limitation all Environmental Laws, the
Americans with Disabilities Act and similar state and local laws.
2.32. "Leases": The Existing Leases and any Approved Lease entered into by
Borrower with respect to the Property after the date hereof, as same may be
amended in accordance with the terms of Section 7.2(b) of this Agreement.
2.33. "Leased Parcel": that portion of the Property leased by Borrower
pursuant to the Ground Lease, legally described as Parcel 2 on Exhibit A.
2.34. "Leasehold Improvements": tenant improvements and build-out to leased
premises required to be paid for by Borrower, pursuant to the terms of Approved
Leases, whether such improvements are to be constructed by landlord or tenant
under the applicable Approved Lease.
2.35. "Leasing Commissions": commissions to be paid to licensed real estate
brokers and/or agents with respect to an Approved Lease, including Leasing
Commissions payable to Property Manager.
2.36. "Leasing Cost Account": the definition ascribed to this term in
Section 7.3(a).
2.37. "Leasing Costs": Leasing Commissions and the cost of Leasehold
Improvements which are the obligation of Borrower, as landlord under the Leases,
to be paid with respect to Approved Leases.
2.38. "LIBOR Adjustment Index": the definition ascribed to this term in
Section 4.2(a).
2.39. "Loan Documents": all documents, agreements, certificates,
instruments and other writings now or hereafter executed by or delivered or
caused to be delivered by Borrower, Guarantor or any other Person to or for the
benefit of Lender, evidencing or securing all or any part of the indebtedness
evidenced by the Note and this Agreement, including, without limitation, the
Commitment Letter, this Agreement, the Note, the Mortgage, the Guaranty
Agreement, and all Modifications thereto or thereof.
2.40. "Loan Party": Borrower, Guarantor and each and every other Person
(other than Lender) who has executed or delivered a Loan Document.
2.41. "Management Agreement": that certain Management Agreement dated
February 5, 1999 by and between Borrower, as owner, and PGR, as manager, as
amended or modified with Lender's prior written approval.
2.42. "Material Adverse Event": an event which has the effect of: (i)
materially adversely affecting Borrower's ability to perform its obligations
under this Loan Agreement or any other Loan Document to which it is a party;
(ii) materially adversely affecting Guarantor's ability to perform its
obligations under the Guaranty Agreement or any other Loan Document to which it
is a party; (iii) materially adversely affecting Borrower's ability to perform
its obligations under any Ground Lease; (iv) affecting National City Bank's or
Xxxxx & Hostetler's obligation to perform under their respective Existing Leases
as a result of any act or omission by Borrower, as landlord, under such Existing
Leases; or (v) impairing the validity of the security interest in the Property
or materially impairing the validity of the security interest in any other
Collateral.
2.43. "Maturity Date": April 30, 2006, or such earlier date that all
Secured Obligations shall be due and payable by acceleration or otherwise.
2.44. "Mezzanine Lender": Fleet National Bank, a national banking
association.
2.45. "Mezzanine Loan": a loan made by Mezzanine Lender to PGR, and further
described in Section 5.18.
2.46. "Mezzanine Loan Documents": those documents identified on Schedule
5.18, attached hereto and made a part hereof.
2.47. "Modifications": any extension, renewal, substitution, replacement,
supplement, amendment or modification of any agreement, certificate, document,
instrument or other writing, whether or not contemplated in the original
agreement, document or instrument.
2.48. "Mortgage": that certain Open-End Leasehold Mortgage, Mortgage,
Assignment of Leases and Rents, Security Agreement and Financing Statement
granted by Borrower in favor of Lender which is a lien on the Property.
2.49. "Net Cash Flow": means monthly Net Operating Income minus mandatory
payments of principal and interest payable pursuant to Section 4.3(b) and any
other amounts actually paid to Lender pursuant to Article 6.
2.50. "Net Insurance Proceeds": the definition ascribed to this term in
Section 6.7(c).
2.51. "Net Operating Income": means an amount equal to (a) monthly gross
income from the Property, including but not limited to base rent, deposits or
payments by tenants as reimbursements for taxes, insurance and operating
expenses, Net Insurance Proceeds, Awards, security deposits (to the extent not
deposited into the Security Deposit Escrow Account) and all other income from
the Property, whether recurring or non-recurring and whether or not arising in
the ordinary course of business, minus (b) the sum of (i) all necessary and
ordinary expenses of the Property, actually incurred by the Borrower in the
ownership, operation, repair and maintenance of the Property during such month,
including payments to the Tax Escrow Account pursuant to Section 5.17(c), a
management fee in the maximum amount of 6% of gross income, insurance reserves,
to the extent not paid for by tenants or deposited into escrow by Borrower with
Lender. Capital expenditures, Leasing Commissions and Leasehold Improvements and
other similar costs incurred in leasing the Property shall not be deemed to be
necessary and ordinary expenses of the Property.
2.52. "Note": The promissory note made by Borrower in favor of Lender and
all Modifications thereto.
2.53. "Operating Account": an interest-bearing operating account which
Borrower shall maintain with Lender for the Property.
2.54. "Organizational Documents": of any Person shall mean, as applicable,
its articles of incorporation, by-laws, certificate of existence, operating
agreement, shareholders' agreement, certificate of partnership, certificate of
limited partnership, partnership agreement, articles of organization, trust
agreement, or similar documents or agreements governing its management and the
rights, duties and privileges of its equity owners.
2.55. "Permitted Exceptions": those exceptions to title listed on Exhibit B
attached hereto.
2.56. "Person": any individual, sole proprietorship, partnership, limited
liability company, joint venture, trust, unincorporated organization,
association, corporation, institution, entity, party or government (whether
national, Federal, state, county, city, municipal or otherwise, including
without limitation any instrumentality, division, agency, body or department
thereof).
2.57. "PGR": Prime Group Realty, L.P., a Delaware limited partnership.
2.58. "PGRT": Prime Group Realty Trust, a Maryland real estate investment
trust.
2.59. "Secured Obligations": (i) the principal of and interest on the Note
and/or this Agreement; (ii) all indebtedness of any kind arising under, and all
amounts of any kind which at any time become due or owing to Lender under or
with respect to the Note, this Agreement, the Mortgage or any of the other Loan
Documents; (iii) all of the covenants, obligations and agreements of Borrower or
any other Loan Party in, under or pursuant to the Note, this Agreement, the
Mortgage, and/or any of the other Loan Documents; (iv) all advances, costs or
expenses paid or incurred by Lender to protect any or all of the Collateral,
perform any obligation of Borrower or any other Loan Party hereunder or under
any other Loan Document, or collect any amount owing by Borrower to Lender; (v)
any and all other liabilities, obligations and indebtedness, howsoever created,
arising or evidenced, direct or indirect, absolute or contingent, recourse or
nonrecourse, now or hereafter existing or to become due, owing by Borrower
and/or Guarantor to Lender with respect to this Agreement, the other Loan
Documents and/or the Property; (vi) interest on all of the foregoing; and (vii)
Costs and the Exit Fee.
2.60. "Security Deposit Escrow Account" the escrow account established
pursuant to Section 7.3(c).
2.61. "Tax Escrow Account": the meaning ascribed to this term in Section
5.17(c).
2.62. "Unavoidable Delay": a delay in the completion of the Work caused by
or attributable to acts of God, unusual weather conditions, strikes, lockouts or
labor disputes (including those involving Borrower if Borrower has used all
reasonable means to conclude the strike, lockout or labor dispute short of
conceding Borrower's position in the labor matter), inability to obtain an
adequate supply of materials, fuel, water, electricity, labor or other supplies,
casualty, governmental action, accidents, breakage, repairs, or other
conditions, matters or events which are not within the control of Borrower and
not attributable to the bad faith of Borrower, excluding the lack of funds to
perform any obligations hereunder.
2.63. "Unmatured Default": any event which with the passage of time, the
giving of notice or both would be an Event of Default hereunder or under any
other Loan Document.
2.64. "Work": the definition ascribed to this term in Section 5.19.
3. Representations and Warranties.
To induce Lender to execute this Agreement and to make the Loan, Borrower hereby
makes the following representations, warranties and covenants, in addition to
those representations set forth in other Sections of this Agreement, which
representations and warranties shall be true and correct on the date hereof and,
unless expressly limited, shall be true and correct at all times during the term
hereof.
3.1. Title and Property.
(a) Borrower has good and marketable leasehold title to the Leased
Parcel and to the fee simple title to the other portions of the Property,
free of all liens, claims and encumbrances, options or leases, except the
Permitted Exceptions and the Approved Leases, if any.
(b) Borrower is well seized of a good, valid and marketable right with
respect to the Easement Parcel.
(c) There are no liens, claims, encumbrances, leases, licenses,
agreements for occupancy, agreements to sell, options to sell, agreements
with contractors, architects, engineers, or any other Person relating to
the Property or the ownership, operation or development of the Property,
other than the Permitted Exceptions, the Existing Leases, the Management
Agreement, and the Approved Leases, if any, and service contracts entered
into in the ordinary course of business, which have been previously
disclosed to Lender.
(d) Borrower does not own: (i) any personal property, other than
equipment incidental to the operation and maintenance of the Property, or
(ii) intangible property (including contract rights) other than the
Existing Leases, the Management Agreement, the other Approved Leases (if
any), service contracts and other contracts relating to the operation and
maintenance of the Property.
(e) As of the date hereof, the improvements on the Property consist of
a 35-story office building, a 4-story connecting annex building and an
adjacent 7-level parking garage, containing approximately 766,965 net
rentable square feet and parking for approximately 645 automobiles. The
Property is commonly known as 0000 X. Xxxxx Xxxxxx, Xxxxxxxxx, Xxxx. A
portion of the Property consisting of approximately 7,264 square feet (with
54.67 feet of direct frontage along Ninth Street) and 132.74 feet deep is
leased pursuant to the Ground Lease.
3.2. Organization.
(a) Borrower. Borrower now, and at all times during the term hereof
(i) is and shall be a limited liability company, duly organized, validly
existing and in good standing under the laws of the State of Delaware and
has complied with all conditions prerequisite to its doing business in the
State of Ohio; (ii) has the power and authority to own its properties and
to transact the business in which it is engaged or proposes to engage;
(iii) is qualified to do business in every jurisdiction in which the nature
of its business or its properties makes such qualification necessary; and
(iv) is in compliance with all Laws applicable to it, unless failure to
comply is not likely to result in a Material Adverse Event. The
Organizational Documents of Borrower, copies of which have been furnished
to Lender, are in full force and effect, have not been amended since the
date of delivery to Lender, and are true, correct and complete copies of
all documents relating to Borrower's creation and governance.
(b) PGRT. Prime Group Realty Trust (i) is, and at all times during the
term hereof shall be, a real estate investment trust, duly organized,
validly existing and in good standing under the laws of the State of
Maryland; (ii) has the power and authority to own its properties and to
transact the business in which it is engaged or proposes to engage; (iii)
is qualified to do business in every jurisdiction in which the nature of
its business or its properties makes such qualification necessary; and (iv)
is in compliance with all Laws applicable to it, unless failure to comply
is not likely to result in a Material Adverse Event. The Organizational
Documents of Prime Group Realty Trust, copies of which have been furnished
to Lender, are in full force and effect, have not been amended since the
date of delivery to Lender, and are true, correct and complete copies of
all documents relating to Prime Group Realty Trust's creation and
governance.
3.3. Authority.
(a) Borrower. Borrower has and at all times during the term hereof
shall have full power, right, capacity and is duly authorized and empowered
to enter into, execute, and deliver this Agreement and the other Loan
Documents to be executed and delivered by it, and to perform its respective
obligations hereunder and thereunder and all such action has been duly and
validly authorized by all necessary limited liability company proceedings
on its part. Upon the execution and delivery hereof and thereof, this
Agreement and all such Loan Documents will be valid, binding upon and
enforceable against Borrower in accordance with their respective terms,
subject to bankruptcy, insolvency and other laws affecting creditor's
rights generally. Without limitation of the foregoing, Borrower has the
power and authority to borrow pursuant to this Agreement and the other Loan
Documents to the fullest extent permitted hereby and thereby, and has taken
all limited liability company actions necessary to effect and authorize
such borrowings. The execution and delivery by Borrower of this Agreement
and the other Loan Documents to be executed and delivered by Borrower does
not and will not contravene, conflict with, violate or constitute a default
under the Organizational Documents of Borrower, or to Borrower's knowledge,
any applicable Law or any agreement, indenture or instrument to which
Borrower is a party, by which Borrower or any of its property is bound, or
which is binding upon or applicable to the Property or any portion thereof.
(b) Violations. Neither the execution and delivery of this Agreement
or any other Loan Document, nor consummation of the transactions herein or
therein contemplated, nor performance of or compliance with the terms and
conditions hereof or thereof, does or will at any time during the term
hereof:
(i) violate or conflict with any Law which is likely to cause a
Material Adverse Event; or
(ii) violate, conflict with or result in a breach of any term or
condition of, or constitute a default under, or result in (or give
rise to any right, contingent or otherwise, of any Person to cause)
any termination, cancellation, prepayment or acceleration of
performance of, or result in the creation or imposition of (or give
rise to any obligation, contingent or otherwise, to create or impose)
any lien upon any property of Borrower (except for any lien in favor
of Lender securing the Secured Obligations) pursuant to, or otherwise
result in (or give rise to any right, contingent or otherwise, of any
Person to cause) any change in any right, power, privilege, duty or
obligation of Borrower under or in connection with:
1. the Organizational Documents of Borrower,
2. any agreement or instrument creating, evidencing or
securing any Indebtedness or any Guaranty Equivalent to which
Borrower is a party or by which it or any of its properties (now
owned or hereafter acquired) may be subject or bound, or
3. as of the date hereof, any other agreement or instrument
or arrangement to which Borrower is a party or by which it or any
of its properties (now owned or hereafter acquired) may be
subject or bound, unless failure to comply is not reasonably
likely to result in a Material Adverse Event.
3.4. Litigation. As of the date hereof, except as set forth in Schedule
3.4, there is no condition, event or circumstance existing, or any litigation,
arbitration, governmental or administrative proceedings, actions, examinations,
claims or demands pending nor, to Borrower's knowledge, threatened affecting
Borrower, Guarantor or the Property that if adversely determined is reasonably
likely to result in a Material Adverse Event and Borrower knows of no basis
therefor.
3.5. Financial Statements. As of the date hereof, all financial information
submitted to Lender relating to Borrower, the Property, and/or Guarantor, is
true and correct in all material respects, has been prepared in accordance with
GAAP, consistently applied, fairly presents the financial condition of the
Person or entity to which they pertain and the other information therein
described, and do not contain any untrue statement of a material fact or omit to
state a fact material to the financial statements submitted or this Agreement.
As of the date of this Agreement, no material adverse change has occurred in the
financial condition of Borrower or the Property since the dates of said
financial statements. Attached hereto as Schedule 3.5, is a statement of the
actual cash flow of the Property for the calendar year 2000.
3.6. Borrower's Financial Condition.
(a) Adverse Conditions. As of the date hereof, no condition,
circumstance, event, agreement, document, instrument, restriction,
litigation or proceeding (or to Borrower's knowledge threatened litigation
or proceeding or basis therefor) exists, (i) which is likely to result in a
Material Adverse Event; or (ii) which would constitute an Event of Default
or Unmatured Default under any of the Loan Documents.
(b) Solvency. Borrower (i) is now and at all times during the term
hereof shall be generally paying its debts as they mature; (ii) now owns,
and at all times during the term hereof shall own, property which, at a
fair valuation, is greater than the sum of its debts; and (iii) now has and
at all times during the term hereof shall have capital sufficient to carry
on its business and transactions and all business transactions in which it
is about to engage.
(c) Tax Returns and Charges. All tax and informational returns
required to be filed by or on behalf of Borrower have been properly
prepared, executed and filed. All taxes, assessments, fees and other
Charges upon Borrower, or upon any of its properties, incomes, sales or
franchises which are due and payable have been paid other than those not
yet delinquent and payable without premium or penalty, and except for those
being diligently contested in good faith by appropriate proceedings, and in
each case adequate reserves and provisions for taxes have been made on the
books of the appropriate entity.
(d) Taxes. Borrower does not know of any proposed additional
assessment or basis for any material assessment for additional taxes
(whether or not reserved against).
(e) Indebtedness. Borrower has no Indebtedness other than Indebtedness
evidenced hereby or arising in the ordinary course of its business since
the dates reflected in the most recent financial statements delivered to
Lender, which is not Indebtedness for borrowed money. Borrower has not
entered into any Guaranty Equivalent, other than as a result of the
endorsement of any instrument of items of payment for deposit or collection
in the ordinary course of business, or as otherwise expressly permitted
pursuant to the terms hereof.
(f) Undisclosed Liabilities. Borrower has no liability or obligation
of any nature whatsoever (whether absolute, accrued, contingent, or
otherwise, whether or not due), except (i) as disclosed in the financial
statements heretofore delivered to Lender; and (ii) since the date of the
most recent financial statements delivered by Borrower to Lender,
liabilities, obligations, and commitments incurred by Borrower in the
ordinary course of business and consistent with past practices or in
connection with the acquisition and/or management of the Property.
(g) Default Under Other Agreements. Borrower is not in default with
respect to any indenture, loan agreement, mortgage, deed or other similar
agreement relating to the borrowing of monies to which it is a party or by
which it is bound.
(h) REG U et al. Borrower's execution and delivery of this Agreement
and the other Loan Documents does not or will not at any time during the
term hereof directly or indirectly violate or result in a violation of the
Securities Exchange Act of 1934, as amended, and Regulations U, T and X of
the Board of Governors of the Federal Reserve System (12 CFR 221, 207, 220
and 224, respectively). Borrower does not own or intend to purchase or
carry any "margin security", as defined in such regulations.
3.7. Business Purpose; Margin Stock; Securities. Borrower warrants and
represents to Lender that it shall use the proceeds of the Loan solely for costs
to repay existing Indebtedness secured by the Property and for other general
purposes in the normal course of business. Borrower's use of the proceeds is a
legal and proper use (duly authorized by all requisite action of the managers
and members of Borrower), in accordance with applicable Laws, as in effect from
time to time. Borrower further warrants and represents to Lender and covenants
with Lender that it is not in the business of extending credit for the purpose
of purchasing or carrying margin stock (within the meaning of Regulation U
issued by the Board of Governors of the Federal Reserve System), and no proceeds
of the Loan will be used to purchase or carry any margin stock or to extend
credit to others for the purpose of purchasing or carrying any margin stock.
3.8. UCC Financing Statements. Except for financing statements in favor of
Lender, there are and shall be no UCC financing statements in effect which
pertain to: (i) any rights in any personal property or fixtures now or hereafter
owned by Borrower and situated on the Property and/or, (ii) as to any personal
property or fixtures owned by Borrower.
3.9. Single Purpose Entity. Borrower represents, warrants, covenants and
agrees to ensure at all times during the term of this Agreement, that it shall
operate and maintain its status as an independent entity, separate and distinct
from all other entities, and that:
(a) Borrower shall not own property or assets, other than the
Property, any improvements thereon, leases thereof, contract rights
relating thereto, and other personal and intangible property used or useful
solely in connection with the ownership, operation, and maintenance of the
Property;
(b) Borrower shall not enter into any agreement to provide services to
any third party other than tenants of the Property;
(c) Borrower's Operating Agreement shall limit its purpose to owning,
constructing, developing, operating, managing, improving, leasing, selling,
mortgaging, financing, refinancing and maintaining the Property and other
lawful activities incidental thereto;
(d) Borrower shall not engage in any business or activity other than
the acquisition, construction, ownership, improvement, leasing, operation
and maintenance of the Property, and other lawful activities incidental
thereto;
(e) Borrower shall not acquire or own any material asset other than
the Property and incidental personal property as may be necessary or
appropriate for the operation, leasing and maintenance of the Property;
(f) Borrower shall not merge into or consolidate with any Person or
dissolve, terminate or liquidate, in whole or in part, transfer or
otherwise dispose of all or substantially all of its assets or change its
legal structure, without in each case Lender's consent;
(g) Borrower shall not own any subsidiary or make any investment in or
acquire the obligations or securities of any other Person, other than
certificates of deposit, money market accounts or other similar short-term
investments;
(h) Borrower shall not co-mingle its funds or other assets (including
but not limited to receipts and disbursements) with the funds or other
assets of any other Person including but not limited to PGR, Prime Group
Realty Trust or any other affiliate of PGR;
(i) Borrower shall pay its debts and liabilities from its own assets
and shall not pay or become liable for the debts of any other Person;
(j) Borrower shall correct any known misunderstandings regarding the
separate identity of its managers or members;
(k) Borrower shall not hold itself out to be responsible for the debts
of another Person;
(l) Borrower shall maintain books and records and bank accounts
separate from those of any other Person;
(m) Borrower shall maintain its assets in such a manner that is not
costly or difficult to segregate, identify or ascertain such assets;
(n) Borrower shall hold regular entity meetings, as appropriate, to
conduct its business and observe all other appropriate entity formalities;
(o) Borrower shall hold itself out to creditors and the public as a
legal entity separate and distinct from any other Person;
(p) Borrower shall prepare separate tax returns and financial
statements, or if part of a consolidated group, then it will be shown as a
separate member of such group;
(q) Borrower shall allocate and charge fairly and reasonably any
common employee or overhead shared with affiliates;
(r) Borrower shall transact all business with affiliates on an arm's
length basis;
(s) Borrower shall conduct business in its own name and use separate
invoices and checks;
(t) Borrower shall not assume, guarantee, or pay the debts or
obligations of any other Person; and
(u) PGR as the sole member of Borrower has not and will not: (1)
advance or contribute property to Borrower other than by way of capital
contribution, or (2) accept or cause to be made any transfer or
distribution of Borrower's assets to such members in respect of their
ownership of Borrower (other than cash or cash-equivalents pursuant to duly
authorized actions of Borrower taken in accordance with the laws of the
State of Delaware and the State of Ohio).
3.10. Ground Lease. Borrower hereby makes the following representations,
warranties and covenants relating to the Ground Lease:
(a) Lease. By mesne conveyances, Borrower is the tenant under that
certain Lease by and between The Xxxx Realty Company and National City
Bank, filed for record October 26, 1976 at 2:29 P.M., and recorded in Lease
Volume 515, Page 1 of Cuyahoga County Records and assigned by assignment of
Lease from National City Bank to National City Center Joint Venture, filed
for record October 21, 1977 at 3:14 P.M., and recorded in Lease Volume 523,
Page 47 of Cuyahoga County Records and by Assignment between National City
Center Joint Venture, an Ohio Partnership, and Euclid-Ninth Community Urban
Redevelopment Corporation, field for record December 12, 1977 at 11:40
A.M., recorded in Lease Volume 524, Page 469 of Cuyahoga County Records,
and by Assignment and Assumption of the Xxxx Lease from Euclid-Ninth
Community Urban Redevelopment Corporation to BRE/City Center L.L.C., dated
as of February 10, 1998 filed for record February 17, 1998 recorded in
Volume 981563, Page 20 of Cuyahoga County Records (the "Ground Lease"),
pursuant to which Borrower leases the Leased Parcel. A true, accurate and
complete copy of the Ground Lease is attached to the estoppel certificate
of ground lessor, which has been delivered to Lender concurrently herewith.
There are no Modifications to the Ground Lease which have been entered into
or have been agreed to, which are not attached to said estoppel
certificate.
(b) Default; Enforceability. To Borrower's knowledge, the Xxxx Realty
Company is the fee titleholder of the Leased Parcel and the ground lessor
under the Ground Lease. The Ground Lease is in full force and effect,
enforceable by Borrower, as tenant, in accordance with its terms. No
default, event of default or event which with the passage of time, the
giving of notice or both would be a default under the Ground Lease has
occurred and is continuing under the Ground Lease by Borrower, or to
Borrower's knowledge by ground lessor.
(c) Possession. Borrower is the sole tenant under the Ground Lease and
is in exclusive possession of the Leased Parcel, subject only to Existing
Leases and the Permitted Exceptions, if any, related to the Leased Parcel.
(d) Lease Premises. The entire premises leased pursuant to the Ground
Lease is legally described as Parcel 2, on Exhibit A, attached hereto.
(e) Performance. Borrower shall at all times during the term hereof,
fully and timely perform in all material respects all obligations as tenant
under the Ground Lease and shall not permit a default or an event of
default by Borrower to occur under the terms thereof which could permit
ground lessor to terminate such Ground Lease. Borrower hereby expressly
acknowledges and agrees that a default under the Ground Lease shall be an
Event of Default hereunder.
(f) Notices. Borrower shall deliver or cause to be delivered to Lender
any notice, demand, or other communication by ground lessor to Borrower (or
PGR or affiliates) relating to the Ground Lease.
(g) Modifications. Subject to the provisions of Section 5.3 relating
to the purchase of the Leased Parcel, Borrower shall not amend, modify or
supplement the Ground Lease in any manner whatsoever, without Lender's
prior written consent, which consent may be withheld in Lender's exclusive
discretion.
(h) Rent: The annual rent payable under the Ground Lease is
$33,810.26, payable in quarterly installments of $8,452.57 and has been
prepaid through August 31, 2001.
3.11. Easement Parcel. Borrower hereby represents and warrants that there
exists no default, event of default or event which with the passage of time, the
giving of notice or both would be a default under or with respect to the
Easement Parcel.
4. Loan, Interest Payment and Maturity
4.1. Loan. Concurrently with the execution of this Agreement Lender has
disbursed the Loan to Borrower.
4.2. Calculation of Interest.
(a) Interest Rate. Subject to the provisions of Section 4.4, the
outstanding principal balance of the Loan, from time to time, shall bear
interest at a rate per annum (the "Interest Rate") equal to the sum of (i)
the three (3) month London Interbank Offered Rate ("LIBOR Adjustment
Index") as quoted in the Money Rates Section of The Wall Street Journal on
the morning applicable date of determination plus (ii) three and five
one-hundredths of one percent (3.05%) (the "Applicable Percentage").
(b) The Interest Rate shall be determined as provided in Section
4.2(a) above on the date of the initial disbursement and shall be adjusted
on the tenth (10th) day of each February, May, August and November
thereafter during the term hereof (each such date is hereinafter referred
to as an "Adjustment Date"), based on the LIBOR Adjustment Index determined
on such Adjustment Date, plus the Applicable Percentage. The Interest Rate
shall be adjusted on each Adjustment Date; provided that if an - Adjustment
Date is not a Business Day on which The Wall Street Journal is published,
then the Interest Rate shall be determined on the next Business Day,
effective retroactively to the Adjustment Date. Lender shall not be
required to give Borrower notice of any adjustment of the Interest Rate on
an Adjustment Date. The Interest Rate shall be fixed between Adjustment
Dates. In the event The Wall Street Journal ceases to publish LIBOR
Adjustment Index rates, then Lender shall determine the LIBOR Adjustment
Index by reference to such other publication as Lender shall reasonably
select.
(c) Calculation of Interest. Interest on funds advanced hereunder
shall: (i) accrue at the Interest Rate or the Default Rate, as applicable;
and (ii) be computed at the Interest Rate or Default Rate (as applicable)
then in effect and shall be based on the principal balance outstanding.
Interest shall be computed based on a 360-day year and charged for the
actual number of days elapsed. If any disbursement is made into escrow at
the request of Borrower, interest shall be charged from the date of
disbursement into escrow.
4.3. Payments.
(a) Monthly Principal and Interest. Commencing on May 10, 2001 and on
the ten (10th) day of each month during the term hereof, Borrower promises
to pay to the order of Lender equal monthly installments of principal and
interest, as adjusted on each Adjustment Date in accordance with the terms
hereof. The monthly payment shall be an amount equal to interest on the
unpaid principal balance on such Adjustment Date at the Interest Rate
(determined in accordance with Section 4.2), plus principal amortized over
a twenty-five year (300 month) period (the "Amortization Period"). On each
Adjustment Date, the monthly payment of principal and interest shall be
recalculated based upon the then unpaid principal balance, at the Interest
Rate determined in accordance with Section 4.2 and amortized over period of
time from the Adjustment Date to the last day of the Amortization Period.
The payments of principal and interest determined in accordance with such
calculation shall be due and payable on the tenth (10th) day of each month
thereafter until the next occurring Adjustment Date. All payments shall be
made without notice or demand. Any principal payment made to Lender
pursuant to Section 4.3(b) or Section 17(b)(ii) of the Guaranty Agreement
shall not reduce the amount of the monthly payment of principal and
interest determined on the immediately preceding Adjustment Date, until the
next occurring Adjustment Date.
(b) Net Cash Flow. Commencing on February 1, 2004 and on the first day
of each month thereafter, Borrower shall pay to Lender, as a mandatory
principal payment, 100% of the Net Cash Flow for the immediately preceding
month until the principal balance of the Loan has been reduced by an amount
equal to $2,000,000 from payments made pursuant to this Section 4.3(b). The
payments due pursuant to this Section 4.3(b) shall be in addition to, and
not in lieu of, those payments of principal required to be paid pursuant to
Section 4.3(a) or any other provision of this Agreement or any other Loan
Document. At such time as the principal balance of the Loan has been
reduced by an amount equal to $2,000,000 from payments made pursuant to
this Section 4.3(b) (and not including any amounts paid pursuant to Section
4.3(a)), Net Cash Flow shall be deposited into the Leasing Cost Account
pursuant to Section 7.3(a).
(c) Optional Principal Payment. Guarantor shall have the right to make
a principal payment in an amount equal to $5,000,000 in accordance with the
provisions of Section 17(b)(ii) of the Guaranty Agreement, without payment
of prepayment premium payable in accordance with Section 4.6. Such
principal payment shall not be paid by Borrower or from the proceeds of the
operation of the Property,
(d) Maturity. Borrower promises to pay to the order of Lender the
unpaid principal balance plus all accrued but unpaid interest on the Loan,
if not sooner paid or payable by acceleration or otherwise, on the Maturity
Date. All Secured Obligations (including but not limited to principal,
interest, Costs and the Exit Fee) shall be due and payable, if not sooner
paid or payable by acceleration or otherwise, on the Maturity Date.
(e) Method of Payment. All monthly payments of principal and interest
required hereunder and all payments due on the Maturity Date shall be made
payable to the order of Lender at Lender's principal place of business set
forth on page 1 of this Agreement, in immediately available funds no later
than 2:00 (C.S.T. or C.S.D.T., if applicable) on the first day of each
month during the term hereof or on the Maturity Date, as applicable.
4.4. Default Rate. Upon the occurrence of any Event of Default and during
the continuation thereof, the principal amount of the Loan, plus all Costs, fees
and advances made by Lender in accordance with the provisions of this Agreement
or any other Loan Document shall bear interest at the Default Rate.
4.5. Late Payment Fee. Borrower acknowledges that any late payment to
Lender of principal, interest or any other amount required to be paid under this
Agreement, the Note or any other Loan Document will cause Lender to incur costs
not contemplated by this Agreement, the Note or any other Loan Document, the
exact amount of which is difficult and impractical to ascertain. Borrower shall
pay Lender a late payment fee equal to five percent (5 % ) of any payment of
principal, interest or other amount to be paid under this Agreement, the Note or
any other Loan Document which is not received by Lender within fifteen (15) days
of the date when due. The late payment fee provided for herein shall be in
addition to any interest owed at the Default Rate and shall be payable for each
month or partial month during which payment is late.
4.6. Prepayment. Borrower may prepay the Loan, in whole or in part, at any
time, upon no less than two (2) Business Days notice. In the event Borrower
elects to prepay the Loan, or the Loan is prepaid, from sources other than from
Net Insurance Proceeds or Awards or as provided in Section 4.7, then Borrower
shall pay to Lender a prepayment fee in an amount equal to: (a) two percent (2%)
of the sum of the principal amount prepaid, if such prepayment is made on or
before April 30, 2002, and (b) one percent (1 %) of the amount prepaid if such
prepayment is made after April 30, 2002 but on or before April 30, 2003. Subject
to the provisions of the penultimate sentence of this Section 4.6, the
prepayment fee required to be paid pursuant to this Section 4.6 shall be
applicable to all prepayments of principal, from any source of funds or cause of
prepayment, including but not limited to voluntary prepayments, mandatory
prepayments, payments made after an Event of Default or acceleration (or if not
paid, the prepayment fee shall be added to the principal balance hereof), and
payments made by Guarantor or any other Person pursuant to a Guaranty Agreement,
or otherwise. Notwithstanding anything to the contrary contained herein,
prepayments from Guarantor pursuant to Section 17(b)(ii) of the Guaranty, Net
Insurance Proceeds or Awards or as provided in Section 4.7 shall not be required
to include or be subject to the prepayment fee set forth in this Section 4.6.
Borrower may prepay the Loan at any time after April 30, 2003 without paying a
prepayment fee; provided that all other fees and Costs hereunder shall be due
and payable, including the Exit Fee.
4.7. Maximum Legal Interest Rate. The provisions of this Section shall
govern and control over any irreconcilably inconsistent provision contained in
this Agreement or in any other document evidencing or securing the indebtedness
evidenced hereby. Lender shall never be entitled to receive, collect, or apply
as interest hereon (for purposes of this Section the word "interest" shall be
deemed to include any sums treated as interest under applicable law governing
matters of usury and unlawful interest), any amount in excess of the Highest
Lawful Rate (hereinafter defined) and, in the event Lender ever receives,
collects, or applies as interest any such excess, such amount which would be
excessive interest shall be deemed a partial prepayment of principal and shall
be treated hereunder as such; provided that no prepayment premium or penalty
shall be payable in connection with such payment and, if the principal of this
Agreement is paid in full, any remaining excess shall forthwith be paid to
Borrower. In determining whether or not the interest paid or payable, under any
specific contingency, exceeds the Highest Lawful Rate, Borrower and Lender
shall, to the maximum extent permitted under applicable law, (i) characterize
any non-principal payment as an expense, fee or premium rather than as interest,
(ii) exclude voluntary prepayments and the effects thereof, and (iii) spread the
total amount of interest throughout the entire contemplated term of this
Agreement, provided that if this Agreement is paid and performed in full prior
to the end of the full contemplated term hereof, and if the interest received
for the actual period of existence hereof exceeds the Highest Lawful Rate,
Lender shall refund to Borrower the amount of such excess and, in such event,
Lender shall not be subject to any penalties provided by any Laws for
contracting for, charging or receiving interest in excess of the Highest Lawful
Rate. "Highest Lawful Rate" shall mean the maximum rate of interest which Lender
is allowed to contract for, charge, take, reserve or receive under applicable
law after taking into account, to the extent required by applicable law, any and
all relevant payments or charges hereunder.
4.8. Application of Payments. Lender shall have the right unilaterally (and
without notice to or the consent of any Person) to allocate any and all payments
which may be received by or tendered to Lender made by Borrower or any other
Person at any time or from time to time and which relate in any way to the Loan
or any other of the Secured Obligations then due and payable in any order of
priority as Lender in its sole and exclusive discretion shall elect, as follows:
(i) to the payment of any Costs; (ii) to accrued but unpaid interest, penalties,
late payment fees and the Exit Fee; and (iii) to principal. Borrower, (1 )
irrevocably waives the right to direct the application of payments and
collections received by Lender from or on behalf of Borrower, Guarantor and/or
any other Person, and (2) agrees that Lender shall have the continuing exclusive
right to apply and reapply any and all such payments and collections against the
Loan or any other Secured Obligations then due and payable in such manner as
Lender may deem appropriate, notwithstanding any entry by Lender upon any of its
books and records.
4.9. Reapplication of Payments. To the extent that Lender receives any
payment on account of the Secured Obligations, and any such payment(s) and/or
proceeds or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside, subordinated and/or required to be repaid
to a trustee, receiver or any other Person under any bankruptcy act, state or
federal law, common law or equitable cause, then, to the extent of such
payment(s) or proceeds received, the Secured Obligations or part thereof
intended to be satisfied shall be revived and continue in full force and effect,
as if such payment(s) and/or proceeds had not been received by Lender and
applied on account of the Secured Obligations and any lien on the Property and
all other collateral shall be deemed to continue in full force and effect not
withstanding any release of such lien executed by Lender. Borrower shall execute
any and all agreements, notes, documents, mortgages, security agreements or
financing statements reasonably requested by Lender to effect the provisions of
this Section.
4.10. Maturity Date. The Maturity Date shall be April 30, 2006, unless
accelerated upon the occurrence of an Event of Default in accordance with the
provisions hereof. On the Maturity Date, and unless the Loan has been sooner
prepaid in full by Borrower or accelerated by Lender, Borrower shall pay to
Lender the Secured Obligations (including, but not limited to, the entire
outstanding principal balance of the Loan, all accrued and unpaid interest, any
prepayment fee, the Exit Fee, and all other sums then due and owing to Lender
under the Note, this Agreement and the other Loan Documents).
5. Borrower's Covenants
5.1. Representation and Warranties. To the extent any representation or
warranty contained herein refers to an event or state of facts which exists on
the date hereof and shall exist during the term hereof, said representation or
warranty shall be deemed to be an affirmative covenant by Borrower to take all
actions, omit to take such actions or cause such actions to be taken which shall
be necessary or desirable to cause such representation or warranty to be true
and accurate in all material respects at all times during the term hereof. To
the extent any representation, warranty or covenant herein (including the
negative covenants set forth herein) relates to any other Person (including but
not limited to any other Loan Party) it shall be deemed to be a covenant of
Borrower to cause such Person to comply with or otherwise perform such
representation, warranty or covenant, whether or not Borrower has the legal,
corporate or other ability to cause such compliance or performance.
5.2. Reports and Financial Covenants.
(a) Books. Borrower shall keep and maintain at Borrower's sole cost
and expense complete and accurate books and records in accordance with
GAAP, consistently applied and Borrower shall report its operations for tax
purposes in accordance with tax accounting procedures, consistently
applied. The fiscal year of Borrower shall end on December 31 of each year,
unless a different fiscal year shall be required by the Internal Revenue
Code. Borrower shall permit Lender and any authorized representatives of
Lender to have reasonable access to and to inspect, examine and make copies
of the books and records, any and all accounts, data and other documents of
Borrower at all reasonable times upon the giving of reasonable notice of
such intent. In addition, in the event that any material default, material
adverse litigation or material adverse change occurs in the financial
condition of Borrower, then Borrower shall promptly notify Lender of such
occurrence.
(b) Reports. Borrower shall deliver or cause to be delivered to Lender
those reports and financial statements set forth below. All such financial
statements shall be prepared in accordance with GAAP set forth in the
opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board (or any Person
succeeding to the functions thereof).
(i) As soon as practicable, but in no event later than the 20th
day of every month, a statement of income and expense relating to the
Property for the immediately preceding month, in form and detail
reasonably required by Lender and setting forth a calculation of Net
Cash Flow for said month;
(ii) As soon as practicable and in any event within 120 days
after the end of each calendar year, Borrower shall deliver to Lender
statements of income, member's capital and cash flow of Borrower, for
such calendar year, and the balance sheet of Borrower as of the end of
such calendar year, all in detail and satisfactory in scope to Lender
and reviewed or compiled by independent certified public accountants
selected by Borrower and acceptable to Lender, in its sole but
reasonable discretion;
(iii) Within twenty (20) days of the filing thereof, federal
income tax returns of Borrower, (or any request for extension of the
filing date thereof) all certified to be true, complete and correct by
an authorized representative of Borrower; and
(iv) Borrower shall provide, from time to time during the term
hereof, such other information and reports, financial and otherwise,
concerning Borrower, Guarantor and the Property as Lender may
reasonably request.
(c) Guarantor's Financials. Borrower shall cause Guarantor to deliver
all financial reports and to comply with all financial covenants set forth
pursuant to the Guaranty Agreement.
5.3. Ownership. Borrower shall at times own fee simple title to the
Property identified as Parcel 1 on Exhibit A and a valid leasehold interest in
the Property identified as Parcel 2 on Exhibit A, free of all liens, claims and
encumbrances, other than the Permitted Exceptions, and shall be seized of a
good, valid and marketable right with respect to the Easement Parcel identified
as Parcel 3 on Exhibit A. Notwithstanding anything to the contrary contained
herein, provided no Event of Default has occurred hereunder or would be created
thereby, Borrower may purchase fee title to the Leased Parcel for a purchase
price set forth in the Ground Lease at any time during the term hereof, whether
pursuant to the exercise of the option set forth therein, or otherwise; provided
that Borrower shall concurrently with the acquisition of fee title to such land,
amend the Mortgage to provide that it is a mortgage and lien upon such fee title
to such land.
5.4. Ownership; Modification to Operating Agreement.
(a) On the date hereof and (subject to the provisions of Section
5.4(d)) at all times during the term hereof, (i) Borrower's sole member
shall be PGR, and (ii) Prime Group Realty Trust shall be the managing
general partner of PGR.
(b) Except as provided in the Mezzanine Loan Documents or as otherwise
provided herein, during the term hereof, there shall be no assignment,
pledge, or transfer (whether by operation of law or otherwise, and whether
for security purposes or otherwise) of any equity interest (including the
right to receive distributions and profits and the right to vote or
exercise any control) in Borrower.
(c) Borrower shall not, without the prior written consent of Lender
which may be withheld in Lender's sole and exclusive discretion, (i) amend
or modify in any material manner, its operating agreement or any other
Organizational Document of Borrower, or (ii) subject to the provisions of
Section 5.4(d), issue new membership interests in Borrower.
(d) Notwithstanding the foregoing, upon the occurrence of an Event of
Default under the terms of the Mezzanine Loan Documents, Mezzanine Lender
or its nominee, shall be permitted to exercise its rights and remedies
under the Mezzanine Loan Documents and Mezzanine Lender or its nominee
shall have the right to become a member of Borrower. Prior to an Event of
Default under the terms of the Mezzanine Loan Documents, Borrower may
refinance the Mezzanine Loan; provided that, (i) such lender enters into a
Certificate and Agreement upon substantially the same terms as Mezzanine
Lender has entered into concurrently herewith (with such modifications as
Lender shall approve, in its sole, but reasonable discretion); (ii) the new
loan must be on substantially the same or better economic terms as the
Mezzanine Loan (as determined by Lender, in Lender's sole discretion); and
(iii) the collateral granted to secure performance thereof shall not
include the Collateral or any other asset of Borrower.
5.5. Distributions; Payments to Affiliates. Provided no Event of Default or
Unmatured Default has occurred or would be created thereby, Borrower shall be
permitted to make and Borrower's member shall be permitted to receive
Distributions with respect to the ownership of equity interests of Borrower.
Except as heretofore disclosed in writing to Lender, Borrower shall not: (a)
enter into any agreement with any affiliate of Borrower to provide services to
Borrower or the Property or (b) pay any affiliate for any services rendered to
the Property.
5.6. Operating Account. Borrower shall establish an interest-bearing
Operating Account with Lender, into which all revenue associated with the
Property, including, without limitation, Lease rental payments, shall be
deposited and from which Distributions and all expenses of the operation of the
Property, including, without limitation, Loan payments shall be paid. A security
interest in the Operating Account is hereby granted to Lender to secure payment
and performance of all Secured Obligations, whether now existing or hereafter
arising. Failure to deposit all revenues from the operation of the Property into
the Operating Account shall be an Event of Default.
5.7. Furnishing Information and Deliveries.
(a) Inspections. Borrower will:
(i) cooperate with Lender in arranging for inspections by Lender
of the Property from time to time at any reasonable time upon prior
notice (unless an Event of Default has occurred, in which event no
notice shall be required) and shall permit Lender access to the
Property during business hours; provided that Lender shall use
commercially reasonable efforts not to interfere with the quite
enjoyment of the Property by any tenant of the Property or in any
other manner which would cause a default by Borrower, as lessor of the
Property;
(ii) in addition to the financial statements required to be
provided pursuant to Section 5.2 hereof and pursuant to the terms of
the Guaranty, promptly supply Lender with such reasonable information
concerning its assets, liabilities and affairs, and the assets,
liabilities and affairs of Borrower and Guarantor, as Lender may
reasonably request from time to time hereafter;
(iii) deliver to Lender either all of its executed originals (in
the case of chattel paper or instruments) or certified copies (in all
other cases) of all licenses, agreements creating or evidencing
intangibles, all amendments and supplements thereto, and any other
document or instrument which is or evidences Collateral;
(iv) maintain a standard and modern system of accounting in
accordance with GAAP;
(v) permit Lender or any of its agents or representatives to have
access to and to examine all books and records regarding Borrower, PGR
and the Property (including, but not limited to books and records
necessary or desirable for Lender to determine compliance by Borrower,
PGR and or Prime Group Realty Trust with the financial covenants set
forth in the Guaranty Agreement) at any time or times hereafter during
business hours, after reasonable prior telephonic notice to make
copies thereof and to discuss the records with Borrower, its agents,
accountants and employees at all times; and
(vi) permit Lender to copy and make abstracts from any and all of
said books and records.
(b) Notices. In addition to those notices required elsewhere in this
Agreement, Borrower shall provide Lender with written notice immediately
after obtaining knowledge of:
(i) except as otherwise previously disclosed, any event or
occurrence which Borrower has determined is or with the giving of
notice or the passage of time will likely be a Material Adverse Event;
(ii) the commencement of any lockout, strike or walkout relating
to any labor contract to which Borrower is a party; and/or
(iii) as soon as possible and in any event within five (5)
Business Days after Borrower shall have obtained knowledge of the
occurrence of an Event of Default or Unmatured Default, the written
statement of Borrower setting forth the details of such event and the
action which Borrower proposes to take with respect thereto.
5.8. Mechanic's Lien Claims. Borrower will not suffer or permit any
mechanic's lien claims to be filed or otherwise asserted against the Property or
against any funds due any contractor or subcontractor, and Borrower will
promptly, and in any event within thirty (30) days after receipt of notice of
filing, discharge, or cause to be discharged, the same in case of the filing of
any claims for lien or proceedings for the enforcement thereof; provided that in
connection with any such lien or claim which Borrower may in good faith desire
to contest, Borrower may contest the same by appropriate legal proceedings
diligently prosecuted, but only if Borrower shall furnish such security or
indemnity as Lender, in its sole and exclusive discretion, requires to induce
the title insurer to issue an endorsement to the Lender's title policy, in form
and substance acceptable to Lender, in Lender's sole discretion, insuring Lender
against all loss, damage or expense (including the cost of defense) arising from
such lien.
5.9. Lender's Right to Discharge Lien Claims. With respect to the matters
set forth in Section 5.8, if Borrower shall (a) fail within said thirty (30)
days to discharge any asserted liens or claims, or (b) fail within said thirty
(30) days to contest asserted liens or claims and to give security or indemnity
in the manner provided in Section 5.8, or (c) having commenced to contest the
same, and having given such security or indemnity, fail to prosecute such
contest with diligence, or to maintain such indemnity or security so required by
the title insurer for its full amount, or (d) upon a final adverse conclusion of
any such contest, fail within five (5) days after the date of any such final
adverse conclusion of judgment to cause any judgment or decree to be satisfied
and lien to be released, then Lender may, but shall not be required to, procure
the release and discharge of any such claim and any judgment or decree thereon
at Lender's election upon five (5) Business Days notice to Borrower; and,
further, Lender may, in its sole and exclusive discretion, effect any settlement
or compromise of the same, or may furnish such security or indemnity to any
title company, and any amounts so expended by Lender, including premiums paid or
security furnished in connection with the issuance of any surety company bonds,
shall be deemed to constitute disbursements hereunder and shall bear interest
from the date so disbursed until paid at the Default Rate. In settling,
compromising or discharging any claims for lien, Lender shall not be required to
inquire into the validity or amount of any such claim.
5.10. Compliance with Requirements.
(a) Compliance with Laws.
(i) Borrower will at all times be in material and substantial
compliance with, and cause the Property and the use and condition
thereof be in material and substantial compliance with, all Laws
(including, but not limited to, any Laws relating to the holding,
investing and retention of security deposits, zoning or building laws
or ordinances, any noise abatement, occupancy, or environmental
protection laws or regulations, any rules or regulations of the
Federal Aviation Administration, or any rules, regulations or orders
of any governmental agency), and will observe and comply with all
conditions and requirements necessary to preserve and extend any and
all rights, licenses, permits, privileges, easements, rights-of-way,
covenants, restrictions, grants, franchises and concessions
(including, without limitation, those relating to land use and
development, landmark preservation, construction, access, water rights
and use, noise and pollution) which are applicable to Borrower or have
been granted (whether or not of record) for the Property or the use
thereof. Unless required by applicable Law or unless Lender has
otherwise first agreed in writing, Borrower shall not make or allow
any changes to be made in the nature of the use of the Property or any
portion thereof as an office building, parking garage and ancillary
uses. Borrower shall not initiate or acquiesce in any change in any
zoning or other land use classification now or hereafter in effect and
affecting the Property or any part thereof without in each case
obtaining Lender's prior written consent thereto, which consent may be
withheld in Lender's sole discretion.
(ii) Borrower will cause the Property to all times to comply with
all ADA Requirements (as hereinafter defined). Notwithstanding the
foregoing, Lender's consultant has identified the ADA Work which might
be required to cause the Property to be in compliance with ADA. In the
event any Governmental Authority makes demand upon Borrower, or any
other Person commences a proceeding to require the Property to comply
with ADA, in addition to taking such other action as may be required
by such Governmental Authority or proceeding, Borrower shall promptly
complete the ADA Work, at Borrower's sole cost and expense, in a good
and workmanlike manner. Borrower unconditionally agrees to forever
indemnify, defend and hold Lender harmless, and covenants not to xxx
for any claim for contribution against, Lender and its directors,
officers, employees, agents and collateral trustees, and their
respective successors and assigns from and against any and all Damages
(defined below) with respect to, as a direct or indirect result of, or
arising out of any failure of the Property, or any part thereof, to
comply with all ADA Requirements in effect on the Closing Date or at
any time prior to (i) payment and performance in full of the Secured
Obligations or (ii) the Borrower's transfer of title to the Property,
whether by foreclosure, deed-in-lieu of foreclosure or otherwise,
including, without limitation, all costs and expenses incurred by
Lender in connection with any changes made to the Property in order to
cause the Property to comply with all ADA Requirements, regardless of
when such Damage arises, and whether as a result of lawsuit (brought
or threatened), settlement, agreement, governmental inquiry or
investigation, consent order or judgment, injunction or restraining
order relating to lack of compliance by the Property with ADA
Requirements. As used in this Section the following terms shall have
the following meanings: (i) "ADA Requirements" means all requirements
of the Americans with Disabilities Act, any rules or regulations
issued under or pursuant thereto and any laws, rules and regulations
of the State of Illinois or the State of Ohio, as applicable, covering
the same or similar subject matter and any future amendments thereto;
and (ii) "Damages" means all actual damages incurred by Lender
including, without limitation, consequential and punitive damages
required by a court of competent jurisdiction to be paid by Lender to
third-parties, liabilities, reasonable out-of-pocket costs, expenses,
losses, fines, penalties, demands, claims, cost recovery actions,
lawsuits, administrative proceedings, orders, compliance costs,
investigation expenses, consultant fees, reasonable attorneys' and
paralegals' fees and litigation expenses.
(b) Contest of Laws. Borrower shall have the right, after prior notice
to Lender and so long as there exists no material threat to the priority of
the lien of the Mortgage and the Loan Documents, to contest by appropriate,
diligently pursued, legal proceedings conducted in the name of Borrower,
the validity or application of any ordinances, requirements, regulations,
rules, orders and decrees, easements, restrictions, or other such matters
referred to in Section 5.10(a). Borrower shall indemnify and hold Lender
harmless from any reasonable, out-of-pocket cost, expense, liability or
damage, including reasonable attorney's fees, relating to such contest.
(c) Compliance. Borrower shall faithfully and punctually comply in all
material respects (and shall cause all tenants and other persons and
entities which occupy or enter upon the Property so to comply in accordance
with terms of the Leases) with (i) all provisions of all insurance policies
covering or applicable to any portion of the Property, including timely
payment of all premiums on all insurance policies required under this
Agreement from time to time, (ii) all requirements of the issuer of any
such policies, and (iii) all orders, rules, regulations, directives, codes
and other requirements of the National Board of Fire Underwriters (or any
successor body or other body performing similar functions) applicable to
Borrower, to the Property or to the use, manner of use, occupancy,
possession, operation, maintenance, alteration or repair of the Property or
any portion thereof, except that Borrower shall not effect any such
compliance that necessitates structural changes to any of the Property
without giving prior written notice to Lender.
5.11. Chattel Paper: Schedules. Borrower will at all times: (a) deliver to
Lender either all of its executed originals (in the case of chattel paper,
letters of credit, or instruments) or certified copies (in all other cases) of
all leases, agreements creating or evidencing intangibles, all amendments and
supplements thereto, and any other document which is, or which evidences,
governs, or creates, Collateral; and (b) prepare such schedules, summaries,
reports and progress schedules as Lender may reasonably request.
5.12. Utilities. Borrower will pay or cause to be paid all utility charges
incurred in connection with the Property promptly when due and maintain all
utility services available for use at the Property.
5.13. Contract Maintenance; Other Agreements. Borrower will, for the
benefit of Lender, promptly keep, observe, perform and satisfy in all material
respects each obligation, condition, covenant, and restriction affecting the
Property or imposed on it under any agreement between Borrower and a third party
relating to the Collateral or the Secured Obligations so that there will be no
default thereunder and so that the persons (other than Borrower) obligated
thereon shall be and remain at all times obligated to perform for the benefit of
the Property and/or the owner of the Property. Except as expressly contemplated
in the Loan Documents, Borrower will not permit to exist any condition, event or
fact which could allow or serve as a basis or justification for any such person
to avoid such performance.
5.14. Borrower's Obligation to Contest Liens; Priority.
(a) Contest. If any proceedings are filed seeking to enjoin or
otherwise prevent or declare invalid or unlawful the construction,
occupancy, maintenance or operation of the Property or any portion thereof,
within thirty (30) days of the filing thereof Borrower, at Borrower's
option, shall either pay the Secured Obligations in full or cause such
proceedings to be vigorously contested in good faith, and in the event of
an adverse ruling or decision, shall prosecute all allowable appeals
therefrom, and will, without limiting the generality of the foregoing,
resist the entry or seek the stay of any temporary or permanent injunction
that may be entered and use commercially reasonable efforts to bring about
a favorable and speedy disposition of all such proceedings. All such
proceedings, and all of Lender's out-of-pocket costs and reasonable fees
and disbursements of Lender's counsel in connection with any such
proceedings, whether or not Lender is a party thereto, shall be at
Borrower's expense, and all such fees and disbursements incurred by Lender
shall be deemed to be Costs, payable in accordance with Section 8.2.
(b) Continuing Priority. Borrower will: pay such fees, impositions and
charges, execute and file (at Borrower's expense) such financing
statements, obtain such acknowledgments or consents, notify such obligors
or providers of services and materials and do all such other acts and
things as Lender may from time to time reasonably request to establish and
maintain a valid and perfected first and prior lien on and security
interest in the Collateral and to provide for payment to Lender directly of
all cash proceeds thereof, with Lender in possession of the Collateral to
the extent Lender deems possession reasonably necessary to maintain its
security interest in the Collateral; keep all of its books and records
relating to the Collateral on the Property or at the principal office of
Borrower; keep all tangible Collateral on the Property unless replaced with
similar collateral, and except as Lender may otherwise consent in writing;
make notations on its books and records sufficient to enable Lender, as
well as third parties, to determine the interest of Lender hereunder.
5.15. Prohibition of Transfer.
(a) Prohibition on Sale or Encumbrance. Except as expressly permitted
pursuant to Sections 5.4, 7.1 or 7.2, Borrower shall not, without Lender's
prior written consent (which consent may be withheld in Lender's sole and
exclusive discretion): (i) sell, transfer or convey, or permit the sale,
transfer or conveyance, of any interest in the Property or any other
Collateral (legal, equitable or possessory; (ii) suffer, permit or enter
into any agreement for any sale or transfer or the Property, or any
interest in the Property (legal, equitable or possessory) unless such
contract or agreement is for a purchase price in excess of the Secured
Obligation (including the Exit Fee) and requires payment in full of the
Loan on the closing of the transactions contemplated therein and such
contact or agreement does not provide for delivery of possession of the
Property or transfer of any interest in the rents and profits of the
Property prior to the closing date (such as an installment agreement for
deed); (iii) in any way encumber or dispose of or grant or suffer any
security interest, lien or mortgage or other assignment (collateral or
otherwise) of or in all or any portion of or interest in the Property or
any other Collateral (legal, equitable or possessory), whether senior or
junior to the lien of the Mortgage, other than the Permitted Exceptions; or
(iv) permit any events prohibited under the Mortgage relating to the sale,
transfer, pledge of the Property. Borrower shall not enter into any Lease,
except in strict compliance with Article 7. Nothing contained herein or in
any other Loan Document shall be deemed to prohibit or restrict transfers,
assignments, sale or redemption of any ownership interest in PGR or PGRT.
(b) Consent Limited. Any consent by Lender or any waiver of an Event
of Default under this Section 5.15, or of any other requirement contained
in this Agreement or any of the other Loan Documents, shall not constitute
a consent to or waiver of any right, remedy or power of Lender with respect
to any subsequent transfer or Event of Default.
5.16. Indebtedness. Borrower shall not incur any Indebtedness during the
term hereof, other than (a) trade payables incurred in or during the course of
Borrower's business, which does not include indebtedness for borrowed money, and
(b) the Loan.
5.17. Impositions.
(a) Payment of Impositions.
(i) Borrower will pay or cause to be paid before delinquent all
taxes and assessments, general or special, and any and all levies,
claims, charges, expenses and liens, ordinary or extraordinary,
governmental or non-governmental, statutory or otherwise, due or to
become due (collectively referred to herein as an "Imposition" or
"Impositions"), that may be levied, assessed, made, imposed or charged
on or against the Property and the Collateral or any property used in
connection therewith, and will pay before delinquent any tax or other
charge on the interest or estate in lands created or represented by
the Mortgage or by any of the other Loan Documents, whether levied
against Borrower or Lender or otherwise, and will submit to Lender all
receipts showing payment of all of such taxes, assessments and
charges. Provided no Event of Default or Unmatured Default shall have
occurred and be continuing, Borrower shall have the right to use funds
deposited with Lender or reserved from the proceeds of the Loan
pursuant to Section 5.17(c) for the payment of Impositions.
(ii) Notwithstanding anything to the contrary contained in
subsection (i) above, if, by law, any Imposition, at the option of the
taxpayer, can and customarily is paid in installments, whether or not
interest shall accrue on the unpaid balance of such Imposition,
Borrower may, so long as no Event of Default shall exist under this
Agreement or any other Loan Document, exercise the option to pay such
Imposition in installments and, in such event, shall pay such
installments, together with any interest thereon, as the same become
due and payable and before any fine, penalty, additional interest or
cost may be added thereto.
(b) Contest of Impositions. Borrower shall have the right at its own
expense to contest or permit the contest of the amount or validity, in
whole or in part, of any Imposition, by appropriate proceedings diligently
conducted in good faith, but only after payment of such Imposition unless
such payment would operate as a bar to such contest or interfere materially
with the prosecution thereof, in which event, notwithstanding the
provisions of Section 5.17(a), payment of such Imposition shall be
postponed if and only so long as:
(i) neither the Property nor any part thereof would by reason of
such postponement or deferment be, in the reasonable judgment of
Lender, in danger of being forfeited or lost; and
(ii) Borrower shall, upon demand by Lender, have deposited with
Lender into the Tax Escrow Account (or there shall be sufficient funds
in the Tax Escrow Account that were previously deposited by Borrower),
the amount so contested and unpaid, together with all interest and
penalties in connection therewith and all charges that may or might be
assessed against or become a charge on the Property or any part
thereof in such proceedings; and
(iii) Upon termination of any such proceedings, it shall be the
obligation of Borrower to pay the amount of such Imposition or part
thereof as finally determined in such proceedings, the payment of
which may have been deferred during the prosecution of such
proceedings, together with any costs, fees (including counsel fees),
interest, penalties or other liabilities in connection therewith. Upon
such payment, Lender shall return any amount deposited with it with
respect to such Imposition. Notwithstanding the foregoing, Lender
shall, if requested by Borrower, disburse said moneys on deposit with
it directly to the imposing authority to whom such Imposition is
payable. Upon failure of Borrower so to do, the amount theretofore
deposited may be applied by Lender to the payment, removal and
discharge of such Imposition, the interest and penalties in connection
therewith and any costs, fees (including reasonable attorney's fees)
or other liability accruing in any such proceedings. The balance, if
any, shall be returned to Borrower and the deficiency, if any, shall
be paid by Borrower to Lender within five (5) days after demand
therefor.
(c) Deposits. Borrower shall deposit with Lender or its designee,
concurrently herewith and on the first day of each month during the term
hereof, into an interest-bearing account with Lender or its designee (the
"Tax Escrow Account"), an amount sufficient to discharge the obligations of
Borrower under Section 5.17(a) prior to the date such Impositions become
delinquent. The determination of the amount payable concurrently herewith
and the fractional part to be deposited on the first day of each month
thereafter with Lender shall be made by Lender, in its reasonable
discretion, based on 100% of the prior calendar year's Impositions and
Lender's reasonable estimate of the amount by which Impositions can
reasonably be expected to increase. Said amounts shall be held by Lender or
its designee (not in trust and not as agent of Borrower) and may be
commingled with other funds held by Lender or its designee. Provided no
Event of Default has occurred and is continuing, amounts held in the Tax
Escrow Account shall be applied to the payment of the Impositions upon
written request from Borrower to Lender. Subject to Borrower's right to
contest Impositions in accordance with Section 5.17(b) above, Lender shall
have the right, but not the obligation, to pay such Impositions upon
receipt of any xxxx invoice, tax xxxx, bond or assessment therefor, without
inquiry into the accuracy or sufficiency of such xxxx, invoice or
assessment, Borrower's liability therefor or any defenses Borrower may have
against the payment thereof. If at any time within thirty (30) days prior
to the due date of any of the Impositions, the amounts then on deposit
therefor shall be insufficient for the payment of such Imposition in full,
Borrower shall, within ten (10) days after demand, deposit the amount of
the deficiency with Lender. If the amounts deposited are in excess of the
actual Impositions for which they were deposited, Lender shall promptly
refund any such excess to Borrower. Borrower shall deliver to Lender all
tax bills, bond and assessment statements, and statements for any other
obligations referred to above as soon as the same are received by Borrower.
(d) Remedies. Nothing herein contained shall be deemed to affect any
right or remedy of Lender under any other provision of this Agreement or
any other Loan Document or under any statute or rule of law to pay any such
amount from Lender's funds and to add the amount so paid unless same is
paid from an escrow or reserve account to the Secured Obligations. All
amounts so deposited shall be held by Lender or its designee as additional
security for the Secured Obligations and upon the occurrence of an Event of
Default hereunder Lender may, in its sole and absolute discretion and
without regard to the adequacy of its security hereunder, apply such
amounts or any portion thereof, to any part of the Secured Obligation. Any
such application of said amounts or any portion thereof to any Secured
Obligation shall not be construed to cure or waive any Event of Default or
Unmatured Default or invalidate any act done pursuant to any such Event of
Default or notice.
(e) Assignment. If Lender sells or assigns this Agreement, Lender
shall have the right to transfer all amounts deposited under this Section
5.17 to the purchaser or assignee, and provided such assignee assumes all
of Lender's obligations under this Agreement, Lender shall thereupon be
released of its obligations accruing from and after the date of such
assignment and assumption and shall have no further liability hereunder for
the application of such deposits from and after the date of such assignment
and assumption. Borrower shall thereafter look solely to such purchaser or
assignee for such future application and for all future responsibility
relating to such deposits.
5.18. Mezzanine Loan. PGR has advised Lender that PGR has obtained a loan
from Mezzanine Lender in the principal amount not to exceed $20,000,000 (the
"Mezzanine Loan"). Borrower hereby covenants and agrees that:
(a) Notice of Default. Borrower shall deliver to Lender, immediately
upon receipt thereof, any notice received by Borrower relating to any
default or an event which with the passage of time, the giving of notice or
both would constitute an event of default under the Mezzanine Loan
Documents or any intent of Mezzanine Lender to exercise rights under the
pledge agreement of Borrower's membership interests.
(b) Liabilities. Borrower shall not make any payments of principal,
interest or any fee, cost, expense or other amount to Mezzanine Lender with
respect to the Mezzanine Loan at any time that any portion of the Secured
Obligations remains unpaid; provided that nothing in this provision shall
be deemed to prohibit PGR from making such payments from sources other than
payments from Borrower or Distributions from Borrower to PGR in violation
of the terms hereof;
(c) Obligations. Borrower shall not assume, guaranty, become a surety
for or otherwise become obligated (either directly or indirectly,
absolutely or contingently) to pay or perform any obligation under the
Mezzanine Loan Documents or agree to pledge or grant a security interest in
any property of Borrower to secure payment or performance of the Mezzanine
Loan or any liability or obligation under the Mezzanine Loan Documents.
5.19. Work.
(a) Attached hereto as Exhibit G is a schedule of repairs and
maintenance which Lender's consultant has determined are required to
maintain and preserve the Property (the "Work"). That portion of the Work
identified under Section I of Exhibit G and labeled "ADA Accessibility" is
referred to herein the "ADA Work". Borrower hereby covenants and agrees to
complete all Work (other than the ADA Work), at Borrower's sole cost and
expense, on or before April 30, 2002, subject to extension in accordance
with the provisions of Section 5.19(b). Upon completion of the Work (other
than the ADA Work), Lender shall have the right to retain, at Borrower's
sole cost and expense, an architect or other consultant to inspect the Work
(other than the ADA Work) and to determine Borrower's compliance with the
requirements of this Section 5.19. If Lender is not satisfied, in Lender's
reasonable judgment, with Borrower's completion of the Work (other than the
ADA Work), Lender shall deliver written notice to Borrower setting forth
the corrections which must be effected, and Borrower shall have sixty (60)
days, subject to extension in accordance with Section 5.19(b), after
receipt of such notice to complete such Work, to Lender's sole but
reasonable satisfaction. Failure of Borrower to complete the Work (other
than the ADA Work) in accordance with this Section 5.19 shall be an Event
of Default. Borrower hereby: (i) relieves Lender of any and all liability
or responsibility relating in any way whatsoever to the completion of the
Work, including, without limitation, the Work and any errors, omissions or
other defects in the plans and specifications therefor; (ii) acknowledges
that any and all inspections of the Work made by Lender, Lender's
consultant or their respective agents and employees shall be solely for
Lender's own information and shall not be deemed to have been made for or
on account of Borrower or any other party; and (iii) agrees that nothing
contained in this Section 5.19 shall be deemed to limit Borrower's
obligation or liability to repair and maintain the Property in accordance
with the terms of this Agreement or any other Loan Document or to imply
that Borrower's sole obligation to maintain the Property is to complete the
Work.
(b) Unavoidable Delays. If the Work is directly affected and delayed
by an Unavoidable Delay, Borrower must notify Lender in writing within five
(5) Business Days after the event occurs which causes the Unavoidable
Delay. So long as no Event of Default has occurred and is continuing,
Lender shall extend the completion date for the Work (other than the ADA
Work) by a period of time not to exceed sixty (60) days (to a date no later
than June 25, 2002); provided that, if such Unavoidable Delay results from
a labor strike, the period of extension shall be extended by such
additional period as the number of days the labor strike exceeds sixty (60)
days. Any extension pursuant to this Section shall not affect the time for
performance of, or otherwise modify, any of Borrower's or Guarantor's other
obligations under this Agreement or the Maturity Date.
6. Insurance
6.1. Insurance and Eminent Domain. Borrower will at all times maintain or
cause to be maintained on the tangible Collateral, all insurance required at any
time or from time to time by the other Loan Documents or as reasonably requested
by Lender and in any event that insurance identified as Exhibit D.
6.2. Failure to Obtain Insurance.
(a) If Borrower shall fail to obtain or to maintain any of the
policies of insurance required by this Agreement or any other Loan Document
or to pay any premium relating thereto or to renew any such policies of
insurance and to deliver evidence of such renewal to Lender no later than
thirty (30) days prior to the expiration of the existing policy, then
Lender, without waiving or releasing any obligation or default by Borrower
hereunder and whether or not such failure is an Event of Default hereunder,
without notice to Borrower, may (but shall be under no obligation to do so)
obtain and maintain such policies of insurance and pay such premiums and
take any other action with respect thereto which Lender deems advisable.
All amounts so disbursed by Lender shall be deemed Costs hereunder, payable
in accordance with Section 8.2.
(b) Borrower hereby acknowledges that the following notice by Lender
is required by and given in full compliance with the Illinois Collateral
Protection Act. 815 ILCS 180/15:
Unless Borrower provides Lender with evidence of the insurance coverage required
by this Agreement, Lender may purchase insurance at Borrower's expense to
protect Lender's interest in the Property or the other Collateral. This
insurance may, but need not, protect Borrower's interest. The coverage that
Lender purchases may not pay any claim that Borrower makes or any claim that is
made against Borrower in connection with the Property or the other Collateral.
Borrower may later cancel any insurance purchases by Lender, but only after
providing Lender with evidence that insurance for the Property or the other
Collateral, Borrower will be responsible for the cost of that insurance,
including interest and any other charges Lender may impose in connection with
the placement of the insurance, until the effective date of the cancellation or
expiration of the insurance. The cost of the insurance may be added to
Borrower's total outstanding balance or obligation. The cost of insurance may be
more than the cost of insurance Borrower may be able to obtain on its own.
6.3. Separate Insurance. Borrower shall not carry any separate insurance on
the Improvements or other Collateral concurrent in kind or form with any
insurance required hereunder or contributing in the event of loss thereunder,
unless such policy contains a standard non-contributing mortgage clause
entitling Lender to collect any and all proceeds thereunder as well as a
standard waiver of subrogation endorsement.
6.4. Notice of Loss; Repair of Damage. If the Property shall be destroyed
or damaged in whole or in part, by fire or other casualty (including any
casualty for which insurance was not obtained or obtainable) of any kind or
nature, ordinary or extraordinary, foreseen or unforeseen, Borrower shall give
to Lender and the insurance companies that have insured against such risks
prompt notice of such loss. Borrower, at its own cost and expense, whether or
not such damage or destruction shall have been insured, and whether or not
insurance proceeds, if any, shall be sufficient for the purpose, shall promptly
repair, alter, restore, replace and rebuild the same to substantially the same
condition as existed immediately prior to such occurrence; provided that in the
event Lender has collected (or there has been deposited with Lender), but does
not make Net Insurance Proceeds (defined below) available to Borrower for
Restoration (defined below) Borrower shall have the option to either pay all
Secured Obligations or to repair and restore the Property within six (6) months
after the date of such taking or casualty and no prepayment fee shall be due and
payable pursuant to Section 4.6 in connection with any principal payment made
pursuant to this Section 6.4. Lender shall in no event be called upon to repair,
alter, replace, restore or rebuild such Property, or any portion thereof, nor to
pay any of the costs or expenses thereof.
6.5. Settlement of Loss. Provided no Event of Default or Unmatured Default
has occurred and is continuing, Borrower shall have the right to settle and
adjust any claim under such insurance policies which insure against such risk if
the projected cost of Restoration determined in accordance with this Article 6
is less than $2,000,000. If the projected cost of Restoration determined in
accordance with this Article 6 is more than $2,000,000 and/or an Event of
Default or Unmatured Default has occurred and is continuing, Lender (or after
entry of a decree of foreclosure, purchaser at the sale, or the decree creditor,
as applicable) is authorized to either: (i) settle and adjust any claim under
such insurance policies which insure against such risk and Lender shall act in
its sole, but reasonable discretion without consent of Borrower, after written
notice to Borrower (unless an Event of Default has occurred, in which event no
notice shall be required); or (ii) allow Borrower to settle, adjust or
compromise any claims for loss with the insurance companies on the amounts to be
paid with respect to such loss. Any actual, reasonable, out-of-pocket expenses
incurred by Lender in the adjustment, collection or determination of the
application of insurance proceeds shall be Costs hereunder, payable in
accordance with Section 8.2. At the option of Lender, such Costs may be deducted
from insurance proceeds. Nothing contained in this Agreement shall create any
responsibility or obligation on Lender to collect any amount owing on any
insurance policy. All insurance proceeds shall be deposited with Lender to be
disbursed in accordance with the provisions of this Article 6.
6.6. Condemnation and Eminent Domain. Any and all awards compensation or
payment heretofore or hereafter made or to be made to the present or any
subsequent owner of the Property by any governmental or other lawful authority
for the taking, by condemnation or eminent domain, of all or any part of the
Property, (including any award from the United States governmental at any time
after the allowance of a claim therefor, the ascertainment of the amount
thereto, and the issuance of a warrant for payment thereof) (collectively
"Awards"), are hereby assigned by Borrower to Lender to secure payment of the
Secured Obligations. Provided that the estimated amount of the Award is less
than $2,000,000, does not involve any portion of the buildings on the Property,
the taking by such governmental or other lawful authority does not involve a
material portion of the Property and no Event of Default or Unmatured Default
has occurred and is continuing, Borrower shall have the right to negotiate and
settle any Awards. In all other events, Lender shall have the right to negotiate
and settle all Awards. All Awards shall be deposited with Lender to be disbursed
in accordance with the provisions of this Article 6. Lender is hereby authorized
to collect and receive from the condemnation authorities all Awards and to give
appropriate receipts therefor. Borrower, upon obtaining knowledge thereof, shall
give Lender prompt notice of the actual or threatened commencement of any
condemnation or eminent domain proceedings affecting all or any part of the
Property, and shall deliver to Lender copies of any and all papers served in
connection with any such proceedings. Borrower further agrees to make, execute
and deliver to Lender, free and clear of any encumbrance of any kind whatsoever,
any and all further assignments and other instruments reasonably deemed
necessary by Lender for the purpose of validly and sufficiently assigning all
Awards and other compensation heretofore, now and hereafter made to Borrower for
any taking, either permanent or temporary, under any such proceeding.
Notwithstanding the foregoing, any actual, reasonable, out-of-pocket expenses
incurred by Lender in intervening in such action or compromising and settling
such action or claim, or collecting such proceeds shall be Costs hereunder,
payable in accordance with Section 8.2 or deducted from Awards.
6.7. Cost of Restoration and Application of Proceeds.
(a) As used herein, the term "Restoration" shall mean repairs or
restoration to be made by Borrower to restore the Property to substantially
the same use and condition immediately prior to such fire or other casualty
or taking by eminent domain proceedings and to a use and condition (as
reasonably determined by Lender) which shall be the same use and condition
as existed immediately prior to such casualty. As used herein, the term
"Cost of Restoration" shall mean all costs, expenses, charges incurred in
connection with the demolition and Restoration of the Property, including
but not limited to all payments to be made to contractors and materialmen,
architects, and all other costs and expenses set forth below. For purposes
of determining the projected Cost of Restoration, Borrower shall retain,
within thirty (30) days of the casualty, an independent insurance adjuster
engineer or contractor, acceptable to Lender in its reasonable discretion,
which insurance adjuster engineer or contractor shall project the Cost of
Restoration, and such projection shall determine the applicability of the
provisions of this Article 6.
(b) In all events, Lender is authorized to collect and receipt for any
such insurance proceeds or Awards and to hold such insurance proceeds and
Awards as cash collateral in accordance with the provisions of this
Agreement. If an Event of Default has occurred and is continuing or if the
Cost of Restoration as determined in accordance with the provisions of this
Article 6 is greater than $5,000,000, Net Insurance Proceeds (defined
below) may, at the option of Lender, in Lender's sole discretion, be: (i)
applied in reduction of the Secured Obligations, whether due or not
(without prepayment premium payable pursuant to Section 4.6); (ii) held by
Lender and applied to pay for the Cost of Restoration.
(c) If the Cost of Restoration is less than $5,000,000, and provided
that no Event of Default or Unmatured Default exists and is continuing at
any time while Restoration is occurring, and provided the Approved Leases
which have been entered into with respect to the Property will not
terminate as a result of such casualty and will remain in full force and
effect following Restoration, Lender agrees to pay over (or cause to be
paid over) to Borrower, any monies which may be received by Lender from
insurance provided by Borrower or Awards payable with respect to such
eminent domain proceeding, but in no event to any extent or in any sum
exceeding the amount actually collected by Lender upon the loss or taking,
which proceeds or Awards shall be disbursed in accordance with the
provisions of this Article 6. Lender, before paying such monies over to
Borrower, shall be entitled to reimburse itself therefrom for the
necessary, proper reasonable, out-of-pocket expenses paid or incurred by
Lender in collection of such monies. The amount of insurance proceeds or
Award collected by Lender, less the amount reasonably expended by Lender to
collect such insurance proceeds or Award shall be referred to herein as the
"Net Insurance Proceeds".
(i) Restoration of Damage in an Amount Less than $1,000,000. In
the event of any loss, damage or destruction to the Property or a
taking by eminent domain, if the projected cost of Restoration is less
than $1,000,000, in the aggregate, Borrower shall furnish to Lender an
estimate of the cost to complete the Restoration, prepared by a
licensed architect or general contractor reasonably acceptable to
Lender, and Net Insurance Proceeds shall be paid to Borrower upon
completion of Restoration or as Restoration progresses, under such
terms and conditions as Lender shall reasonably impose.
(ii) Restoration of Damage in an Amount Greater Than or Equal to
$1,000,000. In the event of any loss, damage or destruction to the
Property, if the projected cost of Restoration is equal to or greater
than $1,000,000, in the aggregate, and Lender is required or
determines to make proceeds or Awards available to Borrower, Borrower
agrees to furnish the following to Lender not more than one hundred
twenty (120) days after the casualty or condemnation and not less than
ten (10) Business Days before the commencement of any work of
demolition upon the Property or before the commencement of Restoration
(except for work which must be performed to keep the Property safe
from vandals, from becoming a nuisance or to prevent additional damage
from the weather or elements, which work Borrower shall immediately
perform and the cost of which shall be paid from the Net Insurance
Proceeds):
(d) Complete plans and specifications for demolition and Restoration
of the Property, prepared by an architect whose qualifications shall meet
with the reasonable satisfaction of Lender and which plans and
specifications shall meet with reasonable approval of Lender, which plans
and specifications shall be and become the sole and absolute property of
Lender upon the occurrence of an Event of Default.
(e) Borrower shall provide a certificate that, (x) upon completion of
Restoration pursuant to such plans, the Property will comply in all
material respects with all applicable Laws, including all Environmental
Laws, zoning Laws and the Americans with Disabilities Act, and (y) a good
faith estimate that Restoration be completed within twelve (12) months of
the date of said certificate.
(f) An AIA fixed price or maximum agreed price construction contract
in assignable form made with a reputable and responsible builder, providing
for the erection, completion and terms of payment for all work, labor and
material necessary to restore the Property in accordance with the approved
plans and specifications.
(g) In the event the estimated cost of demolition and Restoration of
the Property, plus those incidental costs incurred in connection therewith
described below are in excess of the Net Insurance Proceeds, Borrower shall
deliver to Lender cash in the amount of such excess which cash shall be the
first funds disbursed to restore the Property.
(h) Borrower shall procure, at its sole cost and expense, all
necessary permits and approvals from all governmental authorities having
jurisdiction over the Property or the Restoration and shall, on request,
deliver photocopies thereof to Lender.
(i) Concurrently with each request for disbursement of Net Insurance
Proceeds, Borrower shall cause to be delivered to Lender a certificate of
the architect stating that the sum then requested to be paid either has
been paid by Borrower or is justly due to contractors, subcontractors,
materialmen, engineers, architects or other persons (whose names and
addresses shall be stated), and giving a brief description of such services
and materials and the principal subdivisions thereof and the several
amounts so paid or due each of said persons in respect thereof, and stating
that the progress of the work up to the date of said certificate; that no
part of such expenditures has been or is being made the basis, in any
previous or then pending request, for the withdrawal of Net Insurance
Proceeds, and that the sum then requested does not exceed the value of the
services and material described in said certificate.
(j) There shall be furnished to Lender an official search, or a
certificate of a title company satisfactory to Lender, or other evidence
showing that there has not been filed any vendor's or mechanic's lien
affecting the Property which has not been discharged of record, except as
such will be discharged upon payment of the amount then requested to be
withdrawn.
(k) The Net Insurance Proceeds shall be disbursed through a
construction escrow with the title insurer, which escrow shall provide that
said title insurer shall issue its endorsement to the then existing
Lender's Title Insurance Policy, insuring the priority of the lien of this
Mortgage as a first mortgage lien upon the Property concurrently with each
disbursement of Net Insurance Proceeds.
(l) At Lender's election, Net Insurance Proceeds shall be disbursed
directly to the architect, contractor, subcontractor or materialmen, as
applicable.
(m) At Lender's election, Lender shall have the right to have an
independent architect inspect the progress of the Restoration.
6.8. Costs. Borrower shall pay all Costs incurred in connection with the
Restoration, including without limitation insurance settlement costs, title
insurance premiums, reasonable attorneys' fees, architect's fees, the inspecting
architect's fees, permit fees, bond premiums and escrow fees.
6.9. Event of Default. Upon the occurrence of any Event of Default after
the occurrence of any casualty with respect to which Net Insurance Proceeds are
to be disbursed pursuant to the terms hereof, Lender shall not be obligated to
disburse any further installments of Net Insurance Proceeds unless or until such
Event of Default is waived by Lender or such Unmatured Default is cured.
6.10. Maturity. Notwithstanding anything to the contrary contained herein,
Lender shall not be required to make Net Insurance Proceeds available to
Borrower to pay the cost of Restoration, if such Restoration shall not be
completed by 360-days prior to the Maturity Date in which event, Lender shall
apply such Net Insurance Proceeds to the Secured Obligations (without prepayment
premium payable pursuant to Section 4.6).
7. Leases.
7.1. Representations Regarding Leases. Borrower hereby represent and
warrants as of the date hereof, that:
(a) Existing Leases. Attached hereto as Schedule 7.1(a) is a true,
accurate and complete schedule of all leases, license and agreements for
occupancy affecting the Property, setting forth, in detail reasonably
acceptable to Lender: (i) the name of the tenant; (ii) the date of the
commencement of the Lease; (iii) the premises occupied; (iv) the number of
square feet in the premises; (v) base rent being paid as of the Closing
Date calculated on the basis of square footage; (vi) tenant's percentage
share of common area maintenance and taxes; (vii) rent escalations; (viii)
base year; and (ix) the amount of any deposits for Impositions and common
area maintenance held by Borrower, as landlord, in excess of the amount
then due and owing by tenant. Borrower hereby represents and warrants that
the information set forth on each estoppel certificate delivered by a
tenant under an Existing Lease concurrently herewith (the "Current
"Estoppels"), is true, accurate and complete, except as set forth on
Schedule 7.1(b). Attached hereto as Schedule 7.1(b-2) is a schedule of all
termination rights set forth in the Xxxxx & Xxxxxxxxx lease, which are not
specifically identified in the applicable Current Estoppel.
(b) Copies of Leases. Borrower has delivered a true, accurate and
complete copy of all Existing Leases, and all Modifications, assignments,
transfers or ancillary agreements relating thereto and thereof;
(c) Enforceability. Except as set forth in the Current Estoppels
and/or Schedule 7.1(b), the Existing Leases are in full force and effect,
unamended as of the date hereof, except as disclosed in writing to Lender
and are enforceable by Borrower, as landlord, in accordance with their
respective terms;
(d) Defaults. Except as set forth in the Current Estoppels and/or
Schedule 7.1 (b), there is presently no default or other wrongful act or
omission by Borrower, as landlord, under the Existing Leases or otherwise
in connection with any tenant's occupancy of the Property;
(e) Unmatured Defaults. Except as set forth in the Current Estoppels
and/or Schedule 7.1(b), to Borrower's knowledge, there is no state of facts
which, with the passage of time or the giving of notice or both, could
ripen into a default on the part of any tenant or Borrower under any
Existing Lease;
(f) Complete Agreement. The Existing Leases constitute the complete
agreement between Borrower, as landlord, and all tenants relating to the
Property or any portion thereof, the lease thereof, the option to purchase
of the Property, or any portion thereof, and the guaranty of such
obligations;
(g) Termination Rights. Except as set forth in the Current Estoppels,
Schedule 7.1(b) and/or Schedule 7.1(b-2), no tenant nor any other Person
has any contractual right to terminate any Existing Lease, or any portion
thereof;
(h) Offset Rights. Except as set forth in the Current Estoppels and/or
Schedule 7.1(b), to Borrower's knowledge no tenant nor any other Person has
any existing defenses, or offset rights against rent due or to become due
under the terms of an Existing Lease;
(i) Insurance. All insurance required to be maintained by any tenant
under an Existing Lease is presently in effect and all insurance required
to be maintained by landlord is currently in effect;
(j) Possession. Except as set forth in the Current Estoppels and/or
Schedule 7.1(b), Borrower has no reason to believe that any tenant under
the terms of any Existing Lease which is not at the date hereof in
possession of its premises, will not accept possession of the premises
identified therein as anticipated in such Existing Lease or that any such
tenant will not fully perform all obligations of tenant therein;
(k) Notice of Termination. Except as set forth in the Current
Estoppels and/or Schedule 7.1(b), Borrower has received no notice from any
tenant under any Existing Lease that such tenant desires to terminate its
obligations under such Existing Lease, desires to renegotiate the terms of
such Existing Lease, intends to vacate its leased premises, or intends to
sublet all or any material portion of its leased premises, will not take
possession of such leased premises or intends to exercise any right to
terminate such Lease or any portion thereof;
(l) Default by Landlord. Except as set forth in the Current Estoppels
and/or Schedule 7.1(b), Borrower has no knowledge of any fact or matter
which has occurred or is likely to occur which could result in Borrower
being unable to timely and fully perform all obligations of lessor under
any such Existing Lease;
(m) Conditions. Except as set forth in the Current Estoppels and/or
Schedule 7.1(b), there are no conditions precedent to any tenant's
obligation under any Existing Lease, other than delivery of the premises,
which have not been satisfied or waived by tenant;
(n) Tenant Improvements. Except as set forth in the Current Estoppels,
Schedule 7.1(b) and/or Schedule 7.1(b-2), Borrower is not obligated to pay
for any tenant improvements or to provide improvements to the premises of
any tenant; and
(o) Net Rent. Except as set forth in the Current Estoppels and/or
Schedule 7.1(b), each Existing Lease is a "triple-net" lease requiring
tenant to pay its prorata share of common area maintenance charges, taxes
and insurance.
7.2. Approved Leases.
(a) Minimum Criteria. Borrower shall not enter into any Lease on or
after April 20, 2001 for a premises in excess of 20,000 square feet,
without Lender's prior written approval, in Lender's sole, but reasonable
discretion. Each Lease when approved in writing by Lender is referred to
herein as an "Approved Lease." The Existing Leases set forth on Schedule
7.1 are Approved Leases. It is a prerequisite to Lender's approval of any
Lease that:
(i) Lender shall have received current financial information of
the proposed tenant, in sufficient detail to assess the experience and
credit worthiness of the tenant;
(ii) Lender's judgment of the credit-worthiness of the
prospective tenant;
(iii) the form and content of the lease agreement, including
among other things, a tenant's obligation to provide at least
annually, financial information on the condition of the tenant to the
Borrower, as landlord;
(iv) tenant shall have entered into a subordination,
non-disturbance and attornment agreement in form and substance
reasonably acceptable to Lender;
(v) each Lease of the Property shall provide rent at or greater
than the greatest of (A) market rates or (B) $20.00 per square foot
full service gross lease or (C) $12.50 per square foot for a triple
net lease;
(vi) no free or discounted parking;
(vii) no Lease for the Property shall provide for Leasehold
Improvements to be paid for by Borrower, as landlord, in excess of
$25.00 per square foot;
(viii) no Lease for the Property shall provide for Leasing
Commissions to be paid for by Borrower, as landlord, in excess of
$7.50 per square foot;
(ix) each Lease must be for a term of no less than five (5)
years, with no right to terminate or cancel before the fifth lease
year; and
(x) The proposed use of the premises does not violate any Law
applicable to the Property or involve the generation, storage or
maintenance of any Hazardous Materials other than cleaning supplies
and similar products used in offices in the ordinary course of
business used in strict compliance with Laws, or would result in a
violation of the covenants set forth in the Environmental
Indemnification Agreement delivered by Borrower to Lender pursuant to
the terms hereof.
Lender shall not be deemed to have unreasonably withheld its consent to any
proposed Lease which does not satisfy the foregoing minimum criteria; provided
that, nothing in this Section shall be deemed to limit the criteria or factors
which may be considered by Lender in determining to approve or disapprove a
proposed lease to the factors set forth in this Section.
(b) Leases Not Requiring Approval. Borrower shall have the right
to enter into, amend, modify, terminate and/or grant consents which
might otherwise be prohibited or limited herein or in the other Loan
Documents with respect to individual Leases for the Property for
premises of 20,000 square feet or less for each such Lease and the
aggregate square footage for all such Leases is less than 100,000
square feet, without Lender's prior written consent; provided that the
rents payable pursuant to any such Lease (including any Existing
Lease, as amended), and the Leasing Costs payable with respect to any
such Lease (including any Existing Lease, as amended) must satisfy the
minimum criteria set forth in Section 7.2(a)(v), (vi), (vii) and
(viii). Any Lease which Borrower enters into in compliance with this
Section 7.2(b) shall be deemed to be an Approved Lease.
(c) Standard Lease Form. Each Approved Lease shall be prepared on
a lease form (the "Standard Lease Form"), to be approved by Lender, in
Lender's sole but reasonable discretion, with such modifications in
terms not adversely affecting the basic economics of the Lease, the
financial strength of the tenant, or the transferability of the Lease.
The Standard Lease Form shall include among its terms the following
provisions:
(i) subordination and attornment language in favor of
Lender, including a covenant by tenant to execute estoppel
certificates and a subordination non-disturbance and attornment
agreement in favor of Lender, in form and substance acceptable to
Lender;
(ii) any covenants to make payment to or perform
obligations by landlord to or for the benefit of tenant
shall be personal to Borrower as landlord and shall not be
binding upon Lender;
(iii) Lender's right to notice of default by landlord
and right to cure such default;
(iv) each proposed lease of the Property shall require
tenant to provide financial information to landlord under
the lease no less often than annually;
(v) a reasonable security deposit based upon tenant's
operating history and financial strength, but only if such
Lease is not an Existing Lease; and
(vi) prohibitions on assignment, sublet, transfer and
change of control of tenant.
(d) Approval Process. Lender shall use commercially reasonable
efforts to provide a preliminary response to Borrower within three (3)
Business Days after receipt of all pertinent information reasonably
required by Lender and a copy of the proposed Lease. Lender shall use
commercially reasonable efforts to provide final approval or
disapproval of any proposed lease transaction within the (10) Business
Days after the receipt of final proposed lease documentation and find
information required for its decision. Failure to approve within said
ten (10) Business Day period shall be deemed to be a disapproval.
7.3. Escrows for Leasing Costs.
(a) Leasing Cost Escrow. Attached hereto as Exhibit C is a 2002 Tenant
Improvement & Leasing Commission Budget prepared by Borrower and approved
by Lender. Commencing on June 15, 2001 and on the fifteenth (15th) day of
each month thereafter through and including May 15, 2002, in addition to
any other payments due by Borrower to Lender, Borrower shall deposit into
an interest-bearing account with Lender (the "Leasing Cost Account") an
amount equal to $198,000. Provided no Event of Default has occurred and is
continuing, Borrower shall have the right to withdraw amounts held by
Lender in the Leasing Cost Account to reimburse Borrower or to directly pay
for expenditures made in accordance with the budget set forth on Exhibit C,
upon submission of lien waivers or broker's lien waivers or invoices, as
the case may be in accordance with the applicable Approved Lease, in form,
detail and substance reasonably acceptable to Lender, evidencing such
expenditures and tracking such expenditures with the budget set forth on
Exhibit C.
(b) Net Cash Flow. Commencing after such time as Borrower has paid
$2,000,000 in principal payments in accordance with the provisions of
Section 4.3(b), Borrower shall thereafter, deposit into an interest-bearing
pledged cash flow account (the "Pledged Cash Flow Account") an amount equal
to 100% of the Net Cash Flow in excess of amounts paid by Borrower to
Lender pursuant to Section 4.3(b). Provided no Event of Default or
Unmatured Default has occurred and is continuing, funds deposited in the
Pledged Cash Flow Account pursuant to this Section 7.3(b) may be withdrawn
by Borrower to reimburse Borrower for Leasing Costs actually incurred by
Borrower pursuant to Approved Leases or to directly pay any invoice
relating to such Leasing Costs pursuant to an Approved Lease; provided that
in no event shall funds in the Pledged Cash Flow Account be used to pay
Leasing Commissions in excess of $6.00 per square foot for each Approved
Lease or costs of Leasehold Improvements in excess of $25.00 per square
foot for each Approved Lease.
(c) Security Deposit Escrow Account. In addition to the Leasing Cost
Account and the Tax Escrow Account, Borrower shall establish an
interest-bearing escrow account with Lender (the "Security Deposit Escrow
Account"), into which Borrower shall deposit all security deposits, escrow
deposits, deposits and similar payments by tenants under Leases of the
Property, other than amounts received from tenants and deposited in the Tax
Escrow Account. Borrower shall also deposit with Lender any letter of
credit given by a tenant or any guarantor of any Lease entered into after
April 20, 2001, to secure performance of such tenant's obligations under
its Lease. In the event of a default under a Lease secured by a letter of
credit, Borrower shall draw upon such letter of credit, in strict
compliance with the requirements thereof, and shall deposit the proceeds
thereof into the Security Deposit Escrow Account. Borrower shall have the
right to draw upon the Security Deposit Escrow Account only for: (i) the
purpose of returning to tenant's their respective security deposits upon
full and complete performance of all obligations under their respective
Leases, and (ii) to the extent security deposits have been forfeit, for the
purpose of making expenditures relating to the operation and maintenance of
the Property, including but not limited to payment of the Secured
Obligations, operating expenses, Leasehold Improvements and other Leasing
Costs.
(d) Grant of Security Interest. To secure payment and performance of
all Secured Obligations, Borrower hereby grants to Lender a security
interest in the Leasing Cost Account, the Operating Account, the Security
Deposit Escrow Account and the Pledged Cash Flow Account. Upon the
occurrence and continuance of an Event of Default and regardless of the
sufficiency of any other Collateral, Lender shall have the right to apply
the funds held in such account to any Secured Obligation, in such order of
priority as Lender shall elect, in its sole and absolute discretion.
7.4. Subordination Agreements and Estoppel Certificates.
(a) From time to time during the term hereof, within ten (10) Business
Days after Lender's written request, Borrower shall deliver or cause to be
delivered by each tenant which has entered into an Approved Lease of the
Property, a subordination, non-disturbance and attornment in substantially
the form of agreement attached hereto as Exhibit E, or with respect to any
Existing Lease, such other form as Lender shall have agreed to accept
concurrently herewith.
(b) Prior to the Closing Date, and from time to time during the term
hereof, after Lender's written request and from time to time during the
term hereby, within ten (10) Business Days after Lender's written request,
Borrower shall cause each tenant which has entered into an Existing Lease
of the Property, to deliver to Lender an estoppel certificate (an "Estoppel
Certificate"), in the form of Exhibit F (as amended with Lender's prior
written consent) or such other form as Lender has accepted on the date
hereof, or in the form required pursuant to an Existing Lease stating,
except as expressly disclosed therein: (i) the actual lease is identical to
the Approved Lease previously submitted to Lender; (ii) since the execution
of the Approved Lease and through the date of the Estoppel Certificate, the
work on the Leasehold Improvements has progressed according to the schedule
set forth in such Approved Lease; (iii) to tenant's best knowledge,
Borrower has not committed any defaults under the term of the Approved
Lease and the Approved Lease is in full force and effect; and (iv) tenant
will notify Lender in the event it delivers notice of a default or
cancellation under the terms of the Approved Lease.
7.5. Borrower To Comply With Leases.
(a) Performance of Leases. Borrower will, at its own cost and expense:
(i) faithfully abide by, perform and discharge in all material respects
each and every obligation, covenant and agreement under any Lease to be
performed by the landlord thereunder; and (ii) enforce or secure the
performance of each and every material obligation, covenant, condition and
agreement in any Lease by the tenant thereunder to be performed;
(b) Negative Covenants Relating to Leases. Subject to the provisions
of Section 7.2, without the prior written consent of Lender, Borrower will
not: (i) borrow against, pledge or further assign any rentals due under the
Leases; (ii) permit the prepayment of any rents due under any Lease for
more than thirty (30) days in advance (other than security deposits paid to
Borrower, as landlord, in the ordinary course of business) nor for more
than the next accruing installment of rents, nor anticipate, discount,
compromise, forgive or waive any such rents, except (A) for any rent
abatements or rent credits expressly permitted under the terms of any
Approved Lease, or (B) as may be approved by Lender; (iii) waive, excuse,
or in any manner release or discharge any tenant (including any discharge
or waiver arising from a course of conduct) of or from the material
obligations, covenants, conditions and agreements by said tenants to be
performed under the Leases without the express prior written consent of
Lender; (iv) permit or consent to an assignment or sublet of a tenant's
interest in its Lease (except as expressly permitted under the terms of an
Approved Lease); (v) terminate any Lease or accept a surrender thereof or a
discharge of the tenant unless required to do so by the terms of an
Approved Lease; (vi) consent to a subordination of the interest of any
tenant to any party, other than Lender; (vii) release any guarantor under
any Lease or return the security deposit of any tenant under any Lease
until performance in full of all of such tenant's obligations under the
Lease; (viii) consent to any action or inaction by a tenant which would
allow any other tenant under another Lease to terminate its Lease; (ix)
consent to any material alteration or tenant improvement of a tenant's
leasehold premises, unless such consent is required to construct those
tenant improvements agreed to by a tenant and Borrower prior to the date of
this Loan Agreement, and which have been disclosed to Lender or is required
pursuant to any Approved Lease; or (x) except as expressly permitted
pursuant to Section 7.2, amend or modify any Lease or alter the obligations
of the parties thereunder.
(c) Lender's Right to Perform Under Leases. Should Borrower fail to
perform, comply with or discharge any material obligations of Borrower
under any Lease or should Lender become aware of or be notified by any
tenant under any Lease of a failure on the part of Borrower to so perform,
comply with or discharge its obligations under said Lease, Lender may, but
shall not be obligated to, after notice to Borrower, take such actions as
may be reasonably necessary to remedy such failure. Any such action by
Lender shall not waive or release Borrower from any obligation contained in
this Agreement. Any reasonable out of pocket amount expended by Lender in
such performance or attempted performance shall be deemed to be Costs,
payable in accordance with Section 8.2.
8. Fees and Costs.
8.1. Loan Fees.
(a) Application Fee. Borrower acknowledges that Lender has fully
earned a Loan application fee of $340,000. Said loan application fee has
been paid and is non-refundable. In addition to the foregoing, Borrower
agrees to pay all Costs.
(b) Exit Fee. In addition to the fees and Costs payable pursuant to
the terms of Section 8.1(a) and the other provisions of this Agreement,
when the principal balance hereof, interest and Costs (other than the Exit
Fee) are paid in full (whether at maturity, acceleration, prepayment or
otherwise), Borrower shall pay to Lender an exit fee (the "Exit Fee") in an
amount equal to $1,000,000. The Exit Fee shall be deemed to be fully earned
and payable hereunder, regardless of the time of or reason for the payment.
The Exit Fee shall be paid in cash or certified funds prior to and as a
condition to the release of any Collateral securing payment of the Loan.
8.2. Costs and Other Payments. Unless specifically provided herein or in
any other Loan Document, any Cost, or other advance, disbursement or payment
made by Lender pursuant to this Agreement or any other Loan Document (other than
disbursements of Loan proceeds in accordance with the terms hereof) together
with interest thereon at the Interest Rate shall be part of the Secured
Obligations secured by the Collateral, payable by Borrower within ten (10) days
after demand therefor and if not paid within said ten (10) day period shall bear
interest at the Default Rate, until paid. Lender shall have the right to make
disbursements to pay Costs without notice to or consent of Borrower and any
amount so disbursed shall be Costs hereunder, shall be part of the Secured
Obligations, shall be secured by the Collateral and shall be payable in
accordance with this Section 8.2. With respect to any agreement by Borrower in
this Agreement or in any other Loan Document to pay Lender's attorneys' fees and
disbursements incurred in connection with the Loan, Borrower agrees that each
Loan Document is a "contract of indebtedness" and that the attorneys' fees and
disbursements referenced are those which are a reasonable amount, all as
contemplated by Ohio Revised Code Section 1301.21, as such Section may hereafter
be amended. Borrower further agrees that the Indebtedness incurred in connection
with the Loan is not incurred for purposes that are primarily personal, family
or household and confirms that the total amount owed on the contract of
indebtedness exceeds One Hundred Thousand and no/100 Dollars ($100,000.00).
Notwithstanding anything to the contrary contained herein, Borrower shall not be
liable for any Costs incurred by Lender to review Lender's books and records or
inspection of the Property by Lender's officers, directors and employees in
excess of an aggregate amount equal to $15,000 during the term of the Loan;
provided that nothing contained herein shall be deemed to limit Lender's right
to reimbursement of Costs incurred after the occurrence of an Event of Default
and during the continuation thereof or limit the amount to be reimbursed for
costs and expenses of a third-party consultants, engineers or other agents of
Lender.
8.3. Advertising. Lender and Borrower shall have the right to publicly
announce in print or otherwise that Lender has made the Loan to Borrower, and in
such announcement or advertisement to describe the Loan, including Borrower's
name, the type of Loan, identify the Property and location thereof, and publish
pictures or other graphic representations of the Property.
9. Consultants.
9.1. Consultants and Attorneys. Lender shall have the right to engage
personnel in connection with negotiation, documentation, administration,
servicing and enforcement of the Loan, including, without limitation, attorneys
to (i) review and approve matters of title and survey; (ii) inspect the
structural, mechanical, electrical, plumbing, HVAC, roof systems or any Work
performed on the Property; (iii) issue reports and certificates to Lender; (iv)
in accordance with the terms of this Agreement and the other Loan Documents,
perform tests and inspections and order reports on the land in order to
determine the physical condition of the Property and whether the Property is
free from Hazardous Material; and (v) provide other reasonable services as
requested by Lender. Any reasonable, out-of-pocket expense incurred by Lender
pursuant to this Section shall be Costs hereunder, shall be part of the Secured
Obligations, shall be secured by the Collateral and shall be payable in
accordance with Section 8.2. Borrower shall pay all reasonable, out-of-pocket
expenses incurred by Lender in connection with inspecting the Property,
including, without limitation, all fees and expenses charged by any engineer or
consultant, and shall cooperate with such Persons in all reasonable respects.
9.2. Waiver of Reliance by Borrower. The authority herein conferred upon
Lender, and any action taken by Lender, to inspect the Property or approve
contracts or Leases will be exercised and taken by Lender or any consultant for
Lender's protection only and may not be relied upon by Borrower for any purposes
whatsoever. Neither Lender nor any consultant shall be deemed to have assumed
any responsibility to Borrower with respect to any such action herein authorized
or taken by Lender or any consultant or with respect to the Property,
performance of contacts or Leases or prevention of mechanics' liens from being
claimed or asserted against the Property. Any review, investigation or
inspection conducted by Lender, any consultant retained by Lender or any agent
or representative of Lender to independently verify Borrower's performance of
the covenants, agreements and obligations of Borrower under this Agreement, or
the validity of any representations and warranties made by Borrower hereunder
(regardless of whether the party conducting such review, investigation or
inspection shall have discovered that any of such covenants, agreements or
obligations were not performed or that any such representations or warranties
were not true), shall not affect (or constitute a waiver by Lender of): (a) any
of Borrower's representations and warranties under this Agreement or Lender's
reliance thereon, or (b) Lender's reliance on any facts, information or reports
furnished to Lender by Borrower hereunder.
10. Event of Default.
The occurrence of any one or more of the following shall constitute an "Event of
Default" for purposes of this Agreement:
(a) Failure by Borrower to pay any installment of principal, interest,
or any other amount payable pursuant to this Agreement, the Note, the
Mortgage, or any of the other Loan Documents within five (5) days after
written notice thereof;
(b) if the Collateral, or any portion thereof, is attached, seized,
subjected to a writ of distress, warrant, or are levied upon, or come
within the possession of any receiver, trustee, custodian or assignee for
the benefit of creditors and the same is not terminated or dismissed within
sixty (60) days thereafter;
(c) if a petition under any section or chapter of the Bankruptcy
Reform Act of 1978, as amended, or any similar law or regulation shall be
filed by Borrower, PGR or Prime Group Realty Trust or if Borrower, PGR or
Prime Group Realty Trust shall make an assignment for the benefit of its
creditors or if any case or proceeding is filed by Borrower, PGR or Prime
Group Realty Trust for its dissolution or liquidation;
(d) if Borrower, PGR or Prime Group Realty Trust is enjoined,
restrained or in any way prevented by court order from conducting all or
any material part of its business affairs or if a petition under any
section or chapter of the Bankruptcy Reform Act of 1978, as amended, or any
similar law or regulation is filed against Borrower or if any case or
proceeding is filed against Borrower, PGR or Prime Group Realty Trust for
its dissolution or liquidation and such injunction, restraint or petition
is not dismissed or stayed within sixty (60) days after the entry of filing
thereof;
(e) if an application is made by any Person other than Borrower for
the appointment of a receiver, trustee, or custodian for the Property and
the same is not dismissed or stayed within sixty (60) days after the
application therefor;
(f) Except as expressly provided in any other section of this Article
10 or any other provision of this Agreement, failure by Borrower to
promptly perform any other obligation or observe any other condition,
covenant, term, agreement or provision required to be performed or observed
by Borrower under this Agreement within thirty (30) days after written
notice thereof; provided that: (i) if such default, in the reasonable
discretion of Lender, creates a hazardous condition or materially,
adversely and imminently affects the value of the Property, such default
shall be immediately cured by Borrower; and (ii) subject to the provisions
of subsection (i) above, to the extent that such default is of such a
character which reasonably requires more than thirty (30) days to cure,
Borrower shall have such reasonable additional time to cure the default, if
Borrower has commenced to cure the same within said thirty (30) day period
and is diligently and continuously pursuing such cure, which default shall
in all circumstances be cured within one hundred and twenty (120) days
after delivery of the above required written notice;
(g) A default occurs under Sections 4.3, 5.3, 5.4, 5.5, 5.6, 5.15,
5.16, or 5.17(a) or (c);
(h) A default occurs under Section 5.2 or 5.14 which is not cured
within ten (10) days after notice thereof;
(i) Any default, after applicable notice and cure periods, occurs
under the provisions of the Guaranty Agreement, including but not limited
to a default under Section 17 thereof;
(j) Any inaccuracy or untruth in any representation, or warranty in
any material respect contained in this Agreement, the Guaranty Agreement or
any of the other Loan Documents, or of any statement or certification as to
facts delivered to Lender pursuant to any Loan Document.
(k) The occurrence of any Event of Default or default which is not
cured within the applicable cure or grace periods, if any, under any of the
Note, the Mortgage or any of the other Loan Documents; or
(l) The termination of Borrower as a Delaware limited liability
company, whether voluntary, by operation of law, or otherwise, without
Lender's prior written consent, which is not reinstated within five (5)
days after Borrower's knowledge thereof.
11. Remedies.
(a) Upon the occurrence of any Event of Default set forth in Section 10(b),
(c), (d) or (e) (including after any grace or cure period expressly provided
therein), the unpaid principal balance (including the Exit Fee) shall be
immediately due and payable without any action by Lender. Upon the occurrence of
any other Event of Default, Lender, in addition to availing itself of any
remedies conferred upon it by law and by the terms of the Note, the Mortgage and
the other Loan Documents, may declare the unpaid indebtedness evidenced by the
Note to be immediately due and payable, and exercise any and all remedies at law
or equity, including all remedies of a secured creditor under the Uniform
Commercial Code, concurrently or successively with each other and with any other
available remedies, it being the intent hereof that none of such remedies shall
be to the exclusion of any others.
(b) Upon the occurrence of an Event of Default and during the continuation
thereof, Lender may, without being required to give any notice (except for
notices expressly provided in Article 10 of this Agreement), apply the cash, if
any, then held by it as Collateral hereunder to the payment of the Secured
Obligations. For greater certainty, and not in limitation of the forgoing
sentence, upon the occurrence of an Event of Default and during the continuation
thereof, Lender may, without notice to Borrower (except for notices expressly
required pursuant to Article 10 of this Agreement), charge, set-off and
otherwise apply all or any part of the Leasing Cost Account, the Pledged Cash
Flow Account, the Security Deposit Account, and all other funds, investments and
other property therein, or any other cash Collateral in the possession or
control of Lender to the Secured Obligations, in the order of priority set forth
herein.
12. Miscellaneous.
12.1. Documents of Further Assurance. Borrower shall, upon request of
Lender, execute and deliver such further instruments and documents and do such
further acts and things as may be reasonably required to provide to Lender the
evidence of, and security for, the Loan.
12.2. Incorporation of Other Agreements. The provisions of the other Loan
Documents are incorporated in this Agreement by this reference thereto. Except
as otherwise provided in this Agreement and except as otherwise provided in the
other Loan Documents by specific reference to the applicable provision of this
Agreement, if any provision contained in this Agreement is in conflict with, or
inconsistent with, any provision in the other Loan Documents, Lender shall have
the right to elect, in its sole and absolute discretion, which provision shall
govern and control. Except to the extent provided to the contrary in this
Agreement and in the other Loan Documents, no termination or cancellation
(regardless of cause or procedure) of this Agreement or the other Loan Documents
shall in any way affect or impair the powers, obligations, duties, rights and
liabilities of Borrower or Lender in any way or respect relating to (a) any
transaction or event occurring prior to such termination or cancellation, and/or
(b) any of the undertakings, agreements, covenants, warranties and
representations of Borrower contained in this Agreement or the other Loan
Documents. All such undertakings, agreements, covenants, warranties and
representations shall survive such termination or cancellation.
12.3. Severability. If any provision of this Agreement or the other Loan
Documents or the application thereof to any Person or circumstance is held
invalid or unenforceable, the remainder of this Agreement and the other Loan
Documents and the application of such provision to other Persons or
circumstances will not be affected thereby and the provisions of this Agreement
and the other Loan Documents shall be severable in any such instance.
12.4. Lender's Right to Cure Defaults. If Borrower fails to perform any of
its obligations under this Agreement or any other Loan Document, or if any Event
of Default shall occur hereunder, Lender may, but shall not be obligated to,
perform such obligation or cure such Event of Default, and all reasonable
out-of-pocket amounts expended in so doing, as well as all Costs advanced by
Lender pursuant to this Agreement and the other Loan Documents, shall constitute
additional advances of the Loan, shall be part of the Secured Obligations,
secured by the Collateral and by the lien created by the Mortgage and all of the
other Loan Documents, and shall be payable in accordance with Section 8.2.
12.5. Amendments and Modifications. This Agreement and the other Loan
Documents shall not be amended, modified or supplemented without the written
agreement of Borrower and Lender at the time of such amendment, modification or
supplement. No waiver of any provision of this Agreement or any other Loan
Documents shall be effective unless set forth in writing signed by Lender, and
any such waiver shall be effective only to the extent therein set forth. Failure
by Lender to insist upon full and prompt performance of any provisions of this
Agreement or any other Loan Documents, or to take action in the event of any
breach of any such provision or Event of Default, shall not constitute a waiver
of any rights of Lender, and Lender may at any time thereafter exercise all
rights specified herein or provided by applicable law with respect to such
breach or Event of Default. Receipt by Lender of any instrument or document
shall not constitute or be deemed to be an approval thereof. Any approval
required under any of the Loan Documents must be in writing signed by Lender and
directed to Borrower. Borrower expressly agrees that for purposes of this
Agreement and each and every other Loan Document: (i) this Agreement and each
and every other Loan Document shall be a "credit agreement" under the Illinois
Credit Agreements Act, 815 ILCS 160/1 et. seq. (the "Act"); (ii) the Act applies
to this transaction including, but not limited to, the execution of this
Agreement and each and every other Loan Document; and (iii) any action on or in
any way related to this Agreement and each and every other Loan Document shall
be governed by the Act.
12.6. Notices. Any and all notices given in connection with this Agreement
shall be deemed adequately given only if in writing and addressed to the party
for whom such notices are intended at the address set forth below. All notices
shall be sent by personal delivery, Federal Express or other overnight messenger
service, first class registered or certified mail, postage prepaid, return
receipt requested. A written notice shall be deemed to have been given to the
recipient party on the earlier of: (a) the date it shall be delivered to the
address required by this Agreement; (b) the date delivery shall have been
refused at the address required by this Agreement; or (c) with respect to
notices sent by mail, the date as of which the postal service shall have
indicated such notice to be undeliverable at the address required by this
Agreement. Any and all notices referred to in this Agreement, or which either
party desires to give to the other, shall be addressed as follows:
To Borrower: BRE/City Center L.L.C.
c/o Prime Group Realty Trust
00 Xxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxxx, Co-President
with a copy to: Prime Group Realty Trust
00 X. Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attn: General Counsel
And to: Winston & Xxxxxx
00 Xxxx Xxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxx, Esq.
To Lender: CORUS Bank, N.A.
0000 X. Xxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxx X. Xxxxxxxxx,
First Vice President
with a copy to: Commercial Lending
CORUS Bank, N.A.
0000 X. Xxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxx X. Xxxxxxx, Esq.
Senior Vice President and
General Counsel
And to: Xxxxxxxx & Xxxxxx, Ltd.
00 Xxxxx Xxxxxx Xxxxx.
Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxx, Esq.
Any party hereto may, by notice given hereunder, designate any further or
different addresses to which subsequent notices, certificates or other
communications shall be sent.
12.7. Successors and Assigns. The rights, powers and remedies of Lender
under this Agreement shall inure to the benefit of Lender, its participants,
successors and assigns. The rights and obligations of Borrower under this
Agreement may not be assigned without the prior written consent of Lender (which
may be withheld in Lender's sole and exclusive discretion) and any such
purported assignment by Borrower shall be null and void. Lender shall have the
right to assign, transfer, sell or convey its interest in the Note, this
Agreement or any other Loan Documents, or any part thereof (including without
limitation participations therein) without the consent of or notice to Borrower.
Borrower hereby expressly agrees that Lender may disclose to any assignee,
participant or prospective assignee or participant any and all information
relating to the Borrower, the Property, the Guarantor or any other Person
relating to the Loan and the transactions contemplated herein.
12.8. Governing Law. THE VALIDITY OF THIS AGREEMENT, ITS CONSTRUCTION,
INTERPRETATION AND ENFORCEMENT, AND THE RIGHTS OF BORROWER AND LENDER SHALL BE
DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF ILLINOIS, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.
12.9. Jurisdiction and Venue. TO THE MAXIMUM EXTENT PERMITTED BY LAW,
BORROWER AND LENDER EACH HEREBY AGREES THAT ALL ACTIONS OR PROCEEDINGS ARISING
IN CONNECTION WITH THIS AGREEMENT BE TRIED AND DETERMINED ONLY IN THE FEDERAL
COURT LOCATED IN THE NORTHERN DISTRICT OF ILLINOIS, OR THE STATE COURT LOCATED
IN THE COUNTY OF XXXX, STATE OF ILLINOIS, OR, AT THE SOLE OPTION OF LENDER IN
ANY OTHER COURT IN THE STATE OF ILLINOIS OR IN THE STATE OF OHIO IN WHICH LENDER
SHALL INITIATE LEGAL OR EQUITABLE PROCEEDINGS AND WHICH HAS SUBJECT MATTER
JURISDICTION OVER THE MATTER IN CONTROVERSY. TO THE MAXIMUM EXTENT PERMITTED BY
LAW, BORROWER AND LENDER EACH HEREBY EXPRESSLY WAIVES ANY RIGHT IT MAY HAVE TO
ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT
ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION; PROVIDED, HOWEVER,
THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY
BE BROUGHT, AT LENDER'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND AND LENDER MAY INCLUDE IN ANY SUCH
ACTION ANY PENDANT CLAIMS ARISING UNDER ANY LOAN DOCUMENT. BORROWER HEREBY
EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF THE STATE
OF ILLINOIS, THE STATE OF OHIO, AND OF THE UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF ILLINOIS FOR THE PURPOSE OF SUCH LITIGATION AS SET FORTH
ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN
CONNECTION WITH SUCH LITIGATION. BORROWER FURTHER IRREVOCABLY CONSENTS TO THE
SERVICE OF PROCESS BY CERTIFIED OR REGISTERED MAIL, POSTAGE PREPAID, OR BY
PERSONAL SERVICE AT THE ADDRESS OF BORROWER STATED ABOVE. TO THE EXTENT THAT
BORROWER HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY
COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT
PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO
ITSELF OR ITS PROPERTY, BORROWER HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN
RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT.
12.10. Indemnification. Borrower agrees to indemnify, defend and hold
Lender, its successors, assigns and participants harmless from and against any
and all liabilities, obligations, actual out-of-pocket losses, actual damages,
claims, reasonable, actual, out-of-pocket costs and expenses (including
reasonable attorneys' fees, and expenses, and court costs) of whatever kind or
nature which may be directly incurred by or imposed on Lender by virtue of this
Agreement, including, without limitation, any liability resulting from the
release of any Hazardous Material from the Property into the environment or
resulting from any other violation or alleged violations of law with respect to
any Hazardous Materials at the Property; any brokerage commissions or finder's
fees asserted against Lender with respect to the making of the Loan; any actual,
out-of-pocket loss or damage directly incurred by Lender by reason of the
construction of Borrower and Lender as having the relationship of joint venturer
or partners or Borrower or Lender being deemed to have acted as agent for the
other; and any actual, out-of-pocket loss or damages directly incurred by Lender
as a result of the breach by Borrower of any of its agreements, covenants,
warranties or representations contained herein; provided however, nothing
contained herein shall relieve Lender of liability resulting from Lender's
fraud, gross negligence or willful misconduct. Notwithstanding anything to the
contrary herein, Borrower shall have no liability or obligation with respect to
any event, condition, matter or occurrence which first arises or occurs after
transfer of the Property pursuant to a foreclosure of the lien of the Mortgage
and confirmation of such foreclosure sale, or following Lender's acceptance of a
deed-in-lieu of foreclosure.
12.11. No Joint Venture. Lender, by executing and performing this
Agreement, does not become a partner or joint venturer with Borrower. All
inspections of the Property herein provided for are for the sole benefit of
Lender.
12.12. Time of Essence. Time is of the essence with respect to the payment
of all amounts due Lender under this Agreement and performance and observance by
Borrower of each covenant, agreement, provision and term of this Agreement.
12.13. Violation of Laws. Notwithstanding anything herein contained to the
contrary, Lender will not be required to make any disbursement or perform any
other act under this Agreement if, as a result thereof, Lender will violate any
law, statute, ordinance, rule, regulation or judicial decision applicable
thereto.
12.14. Counterparts. This Agreement may be executed in counterparts, and
all said counterparts when taken together shall constitute one and the same
Agreement.
12.15. Representation by Counsel. Borrower hereby represents that it has
been represented by competent counsel of its choice in the negotiation and
execution of this Agreement and the other Loan Documents; that it has read and
fully understood the terms hereof; that Borrower and its counsel have been
afforded an opportunity to review, negotiate and modify the terms of this
Agreement, and that it intends to be bound hereby. In accordance with the
foregoing, the general rule of construction to the effect that any ambiguities
in a contract are to be resolved against the party drafting the contract shall
not be employed in the construction and interpretation of this Agreement or any
other Loan Document.
12.16. No Third Party Beneficiaries. This Agreement is solely for the
benefit of Lender and Borrower and their respective permitted successors and
assigns and nothing contained herein shall be deemed to confer upon any Person
any right to insist on or to enforce the performance or observance of any of the
obligations contained herein. All conditions to the obligations of Lender to
make the Loan hereunder are imposed solely and exclusively for the benefit of
Lender and its respective successors and assigns and no other Person shall have
standing to require satisfaction of such conditions in accordance with their
terms and no other Persons shall under any circumstances be deemed to be a
beneficiary of such conditions.
12.17. Limited Liability. Notwithstanding anything to the contrary
contained herein, no general partner, limited partner, member, trustee, officer,
director, employee, agent or representative of PGR or PGRT shall have any
personal liability for payment or performance of any Secured Obligation,
provided that nothing set forth in this Section shall limit the liability of
Borrower or PGR under this Agreement or any other Loan Document to which it is a
party.
12.18. WAIVER BY BORROWER. EXCEPT AS OTHERWISE PROVIDED FOR IN THIS
AGREEMENT OR REQUIRED BY LAW, BORROWER WAIVES (A) PRESENTMENT, DEMAND AND
PROTEST, NOTICE OF PROTEST, NOTICE OF PRESENTMENT, DEFAULT, NON-PAYMENT,
MATURITY, RELEASE, COMPROMISE, SETTLEMENT, EXTENSION OR RENEWAL OF ANY OR ALL
COMMERCIAL PAPER, ACCOUNTS, CONTRACT RIGHTS, DOCUMENTS, INSTRUMENTS, CHATTEL
PAPER AND GUARANTIES AT ANY TIME HELD BY LENDER ON WHICH BORROWER MAY IN ANY WAY
BE LIABLE; (B) ALL RIGHTS TO NOTICE AND A HEARING PRIOR TO LENDER'S TAKING
POSSESSION OR CONTROL OF, OR TO LENDER REPLEVY, ATTACHMENT OR LEVY UPON THE
COLLATERAL OR ANY BOND OR SECURITY WHICH MIGHT BE REQUIRED BY ANY COURT PRIOR TO
ALLOWING LENDER TO EXERCISE ANY OF LENDER'S REMEDIES; AND (C) THE BENEFIT OF ALL
VALUATION, APPRAISEMENT, EXTENSION AND EXEMPTION LAWS.
12.19. JURY WAIVER. TO THE MAXIMUM EXTENT PERMITTED BY LAW. BORROWER AND
LENDER HEREBY EXPRESSLY WAIVE ANY RIGHT TO TRIAL BY JURY OF ANY ACTION. CAUSE OF
ACTION. CLAIM. DEMAND OR PROCEEDING ARISING UNDER OR WITH RESPECT TO THIS
AGREEMENT. OR IN ANY WAY CONNECTED WITH. RELATED TO OR INCIDENTAL TO THE
DEALINGS OF BORROWER AND LENDER WITH RESPECT TO THIS AGREEMENT. OR THE
TRANSACTIONS RELATED HERETO. IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING. AND WHETHER SOUNDING IN CONTRACT, TORT. OR OTHERWISE. TO THE MAXIMUM
EXTENT PERMITTED BY LAW. BORROWER AND LENDER HEREBY AGREE THAT ANY SUCH ACTION.
CAUSE OF ACTION. CLAIM. DEMAND OR PROCEEDING SHALL BE DECIDED BY A COURT TRIAL
WITHOUT A JURY AND THAT BORROWER OR LENDER MAY FILE AN EXECUTED COPY OF THIS
AGREEMENT WITH ANY COURT OR OTHER TRIBUNAL AS WRITTEN EVIDENCE OF THE CONSENT OF
BORROWER AND LENDER TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY.
The remainder of this page is left intentionally blank.
IN WITNESS WHEREOF, the undersigned parties have executed this Loan
Agreement dated for reference purposes only as of April 25, 2001.
BRE/City Center, L.L.C.,
a Delaware limited liability company,
By: Prime Group Realty, L.P.,
a Delaware limited partnership, its sole member
By: Prime Group Realty Trust, a Maryland real
estate investment trust,
its managing general partner
By:[s] Xxxxx X. Xxxxxxxx
---------------------------------------
Xxxxx X. Xxxxxxxx, Co-President
CORUS Bank, N.A.
By:[s] Xxxx X. Xxxxxxx
---------------------------------------
Xxxx X. Xxxxxxx, Senior,
First Vice President
Schedules and Exhibits
Exhibit A Legal Description
Exhibit B Permitted Exceptions
Exhibit C 2002 Leasing Cost Budget
Exhibit D Insurance Requirements
Exhibit E Subordination, Non-Disturbance and Attornment
Agreement
Exhibit F Estoppel Certificate
Exhibit G Inspecting Architect's Report
Schedule 3.4 Pending Litigation
Schedule 3.5 Cash Flow for 2000
Schedule 5.18 Mezzanine Loan Document
Schedule 7.1 (a) Existing Leases
Schedule 7.1(b) Exceptions to Current Estoppels
Schedule 7.1(b-2) Termination Rights of Xxxxx and Xxxxxxxxx
EXHIBIT A
Legal Description
PARCEL NO.1 (FEE):
Situated in the City of Cleveland, County of Cuyahoga and State of Ohio, and
known as being a part of Original Two Acre Lots Nos. 94, 95, 96, 107 and 108 and
bounded and described as follows:
Beginning in the Northwesterly line of Euclid Avenue, 99 feet in width, at its
intersection with the Southwesterly line of East Ninth Street, 99 feet in width;
thence South 79(degree) 50'00" West along the Northwesterly line of Euclid
Avenue, 393.77 feet to its intersection with a line drawn parallel to and
distant 2.50 feet Northeasterly by rectangular measurement from the
Northeasterly line of land conveyed to The New England Company by deed dated
April 12, 1928 and recorded in Volume 3744, Page 255 of Cuyahoga County Records;
thence North 10(degree) 10'00" West along said parallel line, 119.97 feet to an
angle in a concrete building wall; thence North 38(degree) 47'35" West, 138.59
feet to a point in a Southeasterly line of Xxxxxxx Avenue N.E., 56 feet wide as
shown by the Dedication Map of Xxxxxxx Avenue, N.E., Widening in Volume 226 of
Maps, Page 96 of Cuyahoga County Records, said point being distant North
67(degree) 45'28" East, as measured along the Southeasterly line of Xxxxxxx
Avenue, N.E., 2.68 feet from the Northeasterly line of land conveyed to the New
England Company, as aforesaid; thence North 67(degree) 45'28" East along the
Southeasterly line of Xxxxxxx Avenue, N.E., as widened, 190.06 feet to an angle;
thence North 55(degree) 58'27" East along the Southeasterly line of Xxxxxxx
Avenue, N.E., as widened, 138.33 feet to its intersection with the Southwesterly
line of East Ninth Street; thence South 33(degree) 49'35" East along the
Southwesterly line of East Ninth Street, 88.62 feet to the Northeasterly corner
of land conveyed to The Xxxx Realty Company by deed dated October 19, 1971 and
recorded in Volume 12946, Page 421 of Cuyahoga County Records; thence South
56(degree) 10'25" West along the Northwesterly line of land so conveyed to The
Xxxx Realty Company, 132.74 feet to the Northwesterly corner; thence South
33(degree) 49'35" East along the Southwesterly line of land so conveyed to The
Xxxx Realty Company about 54.67 feet to the Southwesterly corner thereof; thence
North 56(degree) 10'25" East along the Southeasterly line of land so conveyed to
The Xxxx Realty Company, 132.74 feet to its intersection with the Southwesterly
line of East Ninth Street, 99 feet in width; thence, South 33(degree) 49'35"
East along the Southwesterly line of East Ninth Street, 225.00 feet to the place
of beginning, as shown on the Survey of Xxxxxxx & Associates, Inc., dated July
7,1983.
PARCEL NO. 2 LEASED PARCEL:
Situated in the City of Cleveland, County of Cuyahoga and State of Ohio, and
known as being part of Original Two Acre Lot No. 96 and bounded and described as
follows: Beginning on the Southwesterly line of East 9th Street (formerly Erie
Street), 99 feet wide, at a point distant South 33(degree) 49'35" East, 88.62
feet measured along said Southwesterly line from its intersection with the
Southeasterly line of Xxxxxxx Avenue, N.E., as shown by the dedication plat
recorded in Volume 226 of Maps, Page 96 of Cuyahoga County Records, said point
being the most Easterly corner of land conveyed to Xxxxxx Xxxxx, by deed dated
February 26, 1835 and recorded in Volume 27, Page 184 of Cuyahoga County
Records; thence South 56(degree) 10'25" West along the Southeasterly line of
land so conveyed to Xxxxxx Xxxxx, 132.74 feet to the Southwesterly line of said
Two Acre Lot No. 96; thence South 33(degree) 49'35" East along said
Southwesterly line, 54.67 feet; thence North 56(degree) 10'25" East, parallel
with the Southeasterly line of land conveyed to Xxxxxx Xxxxx, as aforesaid,
132.74 feet to the said Southwesterly line of East 9th Street, thence North
33(degree) 49'35" West, along said line of Xxxx 0xx Xxxxxx, 54.67 feet to the
place of beginning, as shown on the Survey of Xxxxxxx & Associates, Inc., dated
July 7,1983.
PARCEL NO. 3 (EASEMENT):
Easement from New England Building, Inc. to Euclid-Ninth Community Urban
Redevelopment Corporation, filed for record April 19,1978 at 3:47 P.M. and
recorded in Volume 14690, Page 615 of Cuyahoga County Records, over the
following described premises:
The Connecting Passageway Opening, one story in height, eight (8) feet wide,
located at the first floor level of the Buildings now situated and to be
situated on the premises described in Exhibits A and B, is located on the
Easterly Lot line of the premises described in Exhibit A, and commences at a
point 27.33 feet North of the intersection of said Easterly Lot line with
Northerly line of Euclid Avenue and continues Northerly along said Easterly Lot
line, a distance of eight (8) feet.
PIN: 101 -27-008
101 -27-009
101 -27-011
101 -27-033
101 -27-034
101 -27-035
Address: National City Center
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxx
EXHIBIT "B"
PERMITTED EXCEPTIONS
1. GENERAL REAL ESTATE TAXES NOT YET DUE AND PAYABLE.
2. IN THE DEED FROM NATIONAL CITY BANK AS SUCCESSOR BY MERGE TO THE NATIONAL
CITY BANK OF CLEVELAND AND NATIONAL CITY BANK, TRUSTEE, TO NATIONAL CITY
CENTER JOINT VENTURE, A JOINT VENTURE AND PARTNERSHIP, FILED FOR RECORD
OCTOBER 21,1977 AT 3:14 P.M., AND RECORDED IN VOLUME 14634, PAGE 143 OF
CUYAHOGA COUNTY RECORDS, CONVEYING PART OF PARCEL NO. 1 THE FOLLOWING
APPEARS:
"THIS CONVEYANCE IS MADE SUBJECT TO THE FOLLOWING RESERVATIONS AND
ADDITIONAL GRANTS AND CONDITIONS, TO-WIT:
I. THE RIGHT OF ENTRY OVER AND UPON THE WESTERLY PORTION OF THE PREMISES
HEREIN CONVEYED, TOGETHER WITH THE AIR SPACES ABOVE, WHERE POSSIBLE, IS
HEREBY RESERVED TO THE EMPLOYEES, AGENTS, REPRESENTATIVES AND INDEPENDENT
CONTRACTORS OF NATIONAL CITY BANK AND NEW ENGLAND BUILDING, INC., THEIR
SUCCESSORS AND ASSIGNS, TOGETHER WITH EQUIPMENT THAT IS REASONABLY
NECESSARY FROM TIME TO TIME TO PROPERLY MAINTAIN THE EASTERLY WALL OF THE
BUILDING KNOWN AT THE DATE HEREOF AS NATIONAL CITY BANK BUILDING, 000
XXXXXX XXXXXX, XXXXXXXXX, XXXX AND WHICH IS IMMEDIATELY ADJACENT TO THE
WESTERLY BOUNDARY OF THE PREMISES HEREIN CONVEYED. THE USE OF SUCH RIGHT OF
ENTRY SHALL BE IN SUCH MANNER AS TO NOT MATERIALLY INTERFERE WITH OR
INTERRUPT THE USE OF THE PREMISES BY THE GRANTEE, ITS TENANTS, SUCCESSORS
OR ASSIGNS. IF AND UPON THE EVENT SAID EASTERLY WALL OF THE BUILDING AT 629
EUCLID AVENUE SHALL BE PERMANENTLY REMOVED, THIS RIGHT OF ENTRY SHALL BE
VOID AND IF NO FURTHER EFFECT AND GRANTOR, ITS SUCCESSORS AND ASSIGNS,
SHALL AT THE REQUEST OF GRANTEE, ITS SUCCESSORS AND ASSIGNS, EXECUTE AND
DELIVER IN WRITTEN RECORDABLE FORM, A FULL AND COMPLETE RELEASE AND
ACQUITTANCE OF THIS RESERVATION OF ENTRY. IT IS FURTHER PROVIDED THAT,
DURING THE PERIOD SAID RIGHT OF ENTRY IS IN EXISTENCE, GRANTEE, ITS
SUCCESSORS AND ASSIGNS, SHALL HAVE THE RIGHT OF REASONABLE APPROVAL OF ALL
PLANS THAT RELATE TO THE ALTERATION OR SURFACE TREATMENT OF SAID EASTERLY
WALL OF THE BUILDING LOCATED AT 000 XXXXXX XXXXXX. NOTWITHSTANDING ANYTHING
HEREIN CONTAINED, THIS RESERVATION SHALL NOT IN ANY MANNER RESTRICT THE USE
OF THE PREMISES HEREIN CONVEYED TO GRANTEE, ITS SUCCESSORS AND ASSIGNS,
INCLUDING THE ERECTION OF WALLS OR STRUCTURES ADJACENT TO OR UPON THE
WESTERLY LINE OF SAID PREMISES RESULTING IN THE DIMINUTION OR IMPAIRMENT OF
ACCESS TO GRANTOR'S WALL AS RESERVED HEREIN.
II. GRANTOR, FOR ITSELF, NEW ENGLAND BUILDING, INC., THEIR SUCCESSORS AND
ASSIGNS, RESERVES THE RIGHT TO USE AND MAINTAIN THE FOOTERS WHICH SUPPORT
THE EASTERLY WALL OF THE BUILDING LOCATED AT 000 XXXXXX XXXXXX AND WHICH
EXTEND OVER AND INTO THE WESTERLY PORTION OF THE PREMISES HEREIN CONVEYED
FOR AS LONG AS A PERIOD AS SAID WALL AND BUILDING EXIST. GRANTOR, FOR
ITSELF AND NEW ENGLAND BUILDING, INC., THEIR SUCCESSORS AND ASSIGNS, HEREBY
GRANTS, AND GIVES TO THE GRANTEE, ITS SUCCESSORS AND ASSIGNS, THE RIGHT TO
BUILD UPON AND INCORPORATE INTO BUILDINGS PLACED UPON THE PREMISES CONVEYED
THE AFORESAID FOOTERS OR TO ALTER, REMOVE AND REPLACE SAID FOOTERS
PROVIDED, ALWAYS, THAT THE GRANTEE, ITS SUCCESSORS AND ASSIGNS, IN SO
INCORPORATING INTO OR ALTERING, REPLACING OR REMOVING SAID FOOTERS SHALL,
AT ALL TIMES, MAINTAIN AND PROTECT THE STRUCTURAL INTEGRITY AND CONDITION
OF THAT PORTION OF THE BUILDING LOCATED AT 000 XXXXXX XXXXXX SUPPORTED BY
SUCH FOOTERS AND SAVE HARMLESS THE GRANTOR, NEW ENGLAND BUILDING, INC.,
THEIR SUCCESSORS AND ASSIGNS, FROM ALL COSTS OR DAMAGES THAT MAY RESULT
THEREFROM. IN THE EVENT GRANTEE, ITS SUCCESSORS OR ASSIGNS, DOES SO
CONSTRUCT IMPROVEMENTS UPON THE PREMISES CONVEYED HEREIN INCORPORATING THE
USE OF THE AFORESAID FOOTERS THEREIN, GRANTOR, ITS SUCCESSORS AND ASSIGNS,
SHALL NOT CAUSE ANYTHING TO BE DONE IN THE EVENT OF ALTERATION OR REMOVAL
OF THAT PORTION OF THE BUILDING LOCATED AT 000 XXXXXX XXXXXX AND SUPPORTED
THEREBY WHICH SHALL IMPAIR THE STRUCTURAL INTEGRITY OF GRANTEE'S
IMPROVEMENTS."
(AFFECTS PARCEL NO.1).
3. IN THE DEED FROM NATIONAL CITY CENTER JOINT VENTURE, A JOINT VENTURE AND
PARTNERSHIP, TO EUCLID-NINTH COMMUNITY URBAN REDEVELOPMENT CORPORATION,
FILED FOR RECORD DECEMBER 12, 1977 AT 11:40 A.M., AND RECORDED IN VOLUME
14651, PAGE 679 OF CUYAHOGA COUNTY RECORDS, CONVEYING PARCEL NO. 1 OF
PREMISES UNDER EXAMINATION, THE FOLLOWING APPEARS:
"GRANTEE, BY ITS ACCEPTANCE OF THIS DEED, HEREBY ACKNOWLEDGES AND AGREES
THAT GRANTEE IS ACQUIRING THE ABOVE-DESCRIBED PREMISES IN CONNECTION WITH
AND AS A PART OF GRANTEE'S UNDERTAKINGS AND ACTIVITIES COMPRISING THE
"PROJECT" AS THAT TERM IS DEFINED AND USED IN THE FINANCIAL AGREEMENT DATED
JUNE 30, 1977 (INCLUDING MODIFICATION THEREOF DATED NOVEMBER 9, 1977)
BETWEEN GRANTEE AND THE CITY OF CLEVELAND, OHIO (THE "CITY").
AS REQUIRED BY THE FINANCIAL AGREEMENT, GRANTEE FURTHER ACKNOWLEDGES AND
AGREES THAT GRANTEE, ITS SUCCESSORS AND ASSIGNS TO OR OF THE
ABOVE-DESCRIBED PREMISES, SHALL USE, DEVELOP AND REDEVELOP THE ABOVE
DESCRIBED PREMISES IN ACCORDANCE WITH, AND FOR THE PERIOD OF, THE NATIONAL
CITY CENTER ACTION AREA SUPPLEMENTARY AMENDMENT TO THE COMMUNITY
DEVELOPMENT PLAN FOR THE CENTRAL CORE APPROVAL BY ORDINANCE NUMBER 1494-77
PASSED BY THE COUNCIL OF THE CITY OF JUNE 27, 1977 AND SHALL NOT
DISCRIMINATE AGAINST ANY PERSON OR GROUP OF PERSONS BASED UPON, RACE,
CREED, SEX, RELIGION, COLOR, AGE, NATIONAL ORIGIN OR ANCESTRY IN THE SALE,
LEASE, SUBLEASE, TRANSFER, OCCUPANCY, TENURE OR ENJOYMENT OF THE ABOVE
DESCRIBED PREMISES. IT IS INTENDED THAT THE FOREGOING AGREEMENTS SHALL BE
COVENANTS RUNNING WITH THE LAND AND THAT THEY SHALL BE BINDING FOR THE
BENEFIT OF AND IN FAVOR OF, AND ENFORCEABLE BY THE CITY AGAINST THE
GRANTEE, ITS SUCCESSORS AND ASSIGNS, AND EVERY SUCCESSOR IN INTEREST TO THE
ABOVE-DESCRIBED PREMISES OR ANY PART THEREOF PROVIDED, THAT SUCH AGREEMENTS
AND COVENANTS SHALL BE BINDING ON THE GRANTEE ITSELF, EACH SUCCESSOR IN
INTEREST TO THE PREMISES AND EVERY PART THEREOF, AND EACH PARTY IN
POSSESSION OR OCCUPANCY, RESPECTIVELY ONLY FOR SUCH PERIOD AS SUCH
SUCCESSOR OR PARTY SHALL HAVE TITLE TO, OR AN INTEREST IN, OR POSSESSION OR
OCCUPANCY OF, THE PREMISES OR PART THEREOF."
(AFFECTS PARCEL NO. 1).
4. DUTIES AND OBLIGATIONS OF THE LEASE BY AND BETWEEN THE XXXX REALTY COMPANY
AND NATIONAL CITY BANK, FILED FOR RECORD OCTOBER 26, 1976 AT 2:29 P.M., AND
RECORDED IN LEASE VOLUME 515, PAGE 1 OF CUYAHOGA COUNTY RECORDS AND
ASSIGNED BY ASSIGNMENT OF LEASE FROM NATIONAL CITY BANK TO NATIONAL CITY
CENTER JOINT VENTURE, FILED FOR RECORD OCTOBER 21, 1977 AT 3:14 P.M., AND
RECORDED IN LEASE VOLUME 523, PAGE 47 OF CUYAHOGA COUNTY RECORDS AND BY
ASSIGNMENT BETWEEN NATIONAL CITY CENTER JOINT VENTURE, AN OHIO PARTNERSHIP,
AND EUCLID-NINTH COMMUNITY URBAN REDEVELOPMENT CORPORATION, FILED FOR
RECORD DECEMBER 12, 1977 AT 11:40 P.M., RECORDED IN LEASE VOLUME 524, PAGE
469 OF CUYAHOGA COUNTY RECORDS, AND BY ASSIGNMENT AND ASSUMPTION OF THE
XXXX LEASE FROM EUCLID NINTH COMMUNITY URBAN REDEVELOPMENT CORPORATION TO
BRE/CITY CENTER, L.L.C., DATED AS OF FEBRUARY 10, 1998 FILED FOR RECORD
FEBRUARY 17, 1998 RECORDED IN VOLUME 98-1563, PAGE 20 OF CUYAHOGA COUNTY
RECORDS.
5. DUTIES AND OBLIGATIONS OF THE GRANT OF RECIPROCAL EASEMENTS BETWEEN NEW
ENGLAND BUILDING, INC. AND EUCLID-NINTH COMMUNITY URBAN REDEVELOPMENT
CORPORATION, FILED FOR RECORD APRIL 19, 1978 AT 3:47 P.M. AND RECORDED IN
VOLUME 14690, PAGE 615 OF CUYAHOGA COUNTY RECORDS.
AMENDMENT TO GRANT OF RECIPROCAL EASEMENTS, FROM NEW ENGLAND BUILDING,
INC., TO EUCLID-NINTH COMMUNITY URBAN REDEVELOPMENT CORPORATION FILED FOR
RECORD NOVEMBER 21, 1980 AT 2:55 P.M., AND RECORDED IN VOLUME 15408, PAGE
79 OF CUYAHOGA COUNTY RECORDS.
(AFFECTS PARCEL NO. 3).
6. MEMORANDUM OF LEASE FROM XXXXXX PARTNERSHIP, AN OHIO GENERAL PARTNERSHIP,
WHOSE GENERAL PARTNERS ARE XXXXXX XXXXXX CORPORATION, XXXXXXX X. MEANS,
XXXXX X. XXXX, XX., XXXXXX X. XXXXXX, AND THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA D/B/A NATIONAL CITY CENTER JOINT VENTURE TO XXXXX, XXXXXXXXX &
XXXXXXXXX, FILED FOR RECORD ON AUGUST 7, 1971 AT 2:33 P.M., AND RECORDED IN
LEASE VOLUME 549, PAGE 563 OF CUYAHOGA COUNTY, OHIO RECORDS.
(AFFECTS PARCEL NOS. 1 AND 2).
7. MEMORANDUM OF LEASE FROM XXXXXX PARTNERSHIP, AN OHIO GENERAL PARTNERSHIP,
WHOSE GENERAL PARTNERS ARE XXXXXX XXXXXX CORPORATION, XXXXXXX X. MEANS,
XXXXX X. XXXX, XX., XXXXXX X. XXXXXX, AND THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA D/B/A NATIONAL CITY CENTER JOINT VENTURE, TO ERNST & ERNST, A
GENERAL PARTNERSHIP, NOW BY CHANGE OF NAME ERNST & WHINNEY, FILED FOR
RECORD ON OCTOBER 29, 1981 AT 3:38 P.M., AND RECORDED IN LEASE VOLUME 551,
PAGE 1 OF CUYAHOGA COUNTY, OHIO RECORDS.
(AFFECTS PARCEL NOS. 1 AND 2).
8. MEMORANDUM OF LEASE FROM NATIONAL CITY CENTER JOINT VENTURE, A JOINT
VENTURE COMPOSED OF XXXXXX PARTNERSHIP, AN OHIO GENERAL PARTNERSHIP, AND
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA, TO NATIONAL CITY BANK, FILED
FOR RECORD AUGUST 3, 1981 AND RECORDED IN LEASE VOLUME 549, PAGE 455 OF
CUYAHOGA COUNTY RECORDS.
(AFFECTS PARCEL NOS. 1 AND 2).
9. MEMORANDUM OF LEASE FROM CARLYLE/NATIONAL CITY ASSOCIATES TO XXXXXXXXXXX,
XXXXXXX, XXXXX AND XXXXXXXX, DATED SEPTEMBER 22, 1993 AND RECORDED IN
VOLUME 93-10146, PAGE 37 OF CUYAHOGA COUNTY RECORDS.
(AFFECTS PARCEL NOS.1 AND 2).
10. RIGHTS OF TENANTS, AS TENANTS ONLY, UNDER UNRECORDED LEASES., INCLUDING THE
EXISTING LEASES.
11. NOTICE OF COMMENCEMENT, FILED FOR RECORD JUNE 5, 1998, RECORDED IN VOLUME
98-7000, PAGE 25 OF CUYAHOGA COUNTY RECORDS, XXXXXX X. XXXXXXX HEREBY
CLAIMS THAT LABOR OR WORK IS ABOUT TO BEGIN ON, OR MATERIALS ARE ABOUT TO
BE FURNISHED FOR, AN IMPROVEMENT TO THE REAL PROPERTY DESCRIBED THEREIN.
EXHIBIT C
2002 TENANT IMPROVEMENT AND LEASING COST BUDGET
[INTENTIONALLY NOT INCLUDED]
EXHIBIT D
INSURANCE REQUIREMENTS
I. Insurance. Borrower shall obtain, and shall maintain at all times during
the term of the Loan, such insurance as Lender may reasonably require,
including, but not limited to the following:
(a) Builder's Risk. During any period of repair or restoration, builder's
"All-Risk" insurance in an amount equal to not less than the full insurable
value of the Property against such risks (including so called All Risk perils
coverage and collapse of the improvements to agreed limits as Lender may
request, in form and substance reasonably acceptable to Lender).
(b) Contractor's Liability. At all times when construction is occurring at
the Property, Contractor's Liability Insurance (to include contractors,
subcontractors and trades to a limit of not less than Two Million Dollars
($2,000,000.00) (or more as Lender shall reasonably request or to the extent
that any contractor carries a higher limit) on a per occurrence basis covering
any contractor's construction operations at the Property, and naming Borrower
and Lender as Additional Insureds.
(c) Worker's Compensation. Worker's compensation insurance to statutory
limits, including USL&H and Xxxxx Act (if applicable) and employer's liability
insurance covering the Borrower's employees (if any) and employees of any
contractor (to the extent required, and in the amounts required by applicable
Laws).
(d) Liability. General Public Liability insurance, including, without
limitation, Commercial General Liability insurance; Owned (if any), Hired and
Non Owned Auto Liability; and Umbrella Liability coverage for Personal Injury,
Bodily Injury, Death, Accident and Property Damage, providing in combination no
less than $50,000,000 per occurrence and in the annual aggregate, per location.
The policies described in this paragraph shall cover, without limitation:
elevators, escalators, independent contractors, Contractual Liability (covering,
to the maximum extent permitted by law, the mortgagor's obligation to indemnify
the mortgagee as required under this agreement, Products and Completed
Operations Liability coverage.
(e) Errors and Omissions. At all times construction is occurring on the
Property, Borrower shall require the architect to: (a) obtain and maintain
professional errors and omissions coverage for Architect and all of its
principals and employees performing architectural and design services for the
Property, and (b) require all engineer and design professional subcontractors to
obtain or maintain professional errors and omissions coverage in connection with
such subcontracted work. Professional errors and omissions insurance shall be
endorsed to provide contractual liability coverage. Certificates of such
coverage shall be furnished along with other certificates of insurance hereunder
and such coverage for the architect and each such professional subcontractor
shall be in an amount reasonably required by Lender, but not less than
$1,000,000 - per occurrence.
(f) (Intentionally Omitted)
(g) Casualty. Property Insurance against loss customarily included under so
called "All Risk" policies including flood, earthquake, vandalism, and malicious
mischief, boiler and machinery, and such other insurable hazards as, under good
insurance practices, from time to time are insured against for other property
and buildings similar to the premises in nature, use, location, height, and type
of construction. Such insurance policy shall also insure the additional expense
of demolition and increased cost of construction due to the enforcement of laws
regulating reconstruction at the time of rebuilding following a loss. The amount
of such "All Risk" insurance shall be not less than one hundred percent (100%)
of the replacement cost value of the improvements. Each such insurance policy
shall contain an agreed amount (Coinsurance waiver) and replacement cost value
endorsement and shall cover, without limitation, all tenant improvements and
betterments which the mortgagor is required to insure in accordance with any
lease. If the insurance required under this paragraph is not obtained by blanket
insurance policies, the insurance policy shall be endorsed to also provide
guaranteed building replacement cost. The Lender shall be named Loss Payee on a
Standard Mortgagee Endorsement and be provided not less than 30 days advance
notice of change in coverage, cancellation or non-renewal.
(h) Flood. If any portion of the improvements located on the Property is
located within an area designated as "flood prone" or a "special flood hazard
area" (as defined under the regulations adopted under the National Flood
Insurance Act of 1968 and the Flood Disaster Protection Act of 1973), flood
insurance shall be provided, in an amount not less than the maximum limit of
coverage available under the Federal Flood Insurance plan with respect to the
Trust Estate. The Lender reserves the right to require Flood Insurance in excess
of that available under the Federal Flood Insurance plan.
(i) Boiler. Comprehensive boiler and machinery insurance covering all
mechanical and electrical equipment against physical damage, rent loss and
improvements loss and covering, without limitation, all tenant improvements and
betterments that the Borrower is required to insure pursuant to any Lease on a
replacement cost basis. The minimum amount of limits to be provided shall be
$10,000,000 per accident.
(j) Rent Loss. Rent loss and/or business interruption insurance on an
actual loss sustained basis as an extension to coverage required by Paragraph
(g), (h) and (i) for twenty-four months above, in an amount not less than the
amount of rent payable or Business Income Earned annually (and providing a 360
day Extended Period of Indemnity). Lender shall be named as Loss Payee as
respects this coverage.
(k) Builder's All-Risk Insurance. During any period of repair or
restoration, builder's "All-Risk" insurance in an amount equal to not less than
the full insurance value of the Trust Estate against such risks (including so
called All Risk perils coverage and collapse of the Improvements to agreed
limits as Beneficiary may request, in form and substance acceptable to
Beneficiary).
(l) Dram Shop. From and after Final Completion of the Property, upon
Lender's reasonable request, so-called "Dram Shop" insurance in the amount of
$1,000,000.00 against claims or liabilities arising directly or indirectly to
Persons or property on account of the sale or dispensing of beer, wine or other
alcoholic beverages shall also be furnished, including in such coverage loss of
means of support, all in amount that may be required by applicable Laws or as
Lender may reasonably specify if any part of the Property is now or hereafter
used for the sale or dispensing of beer, wine or any other alcoholic beverages.
(m) Law and Ordinance. From and after Completion of the Property, increased
cost of law and ordinance insurance (covering additional costs required by
building code changes).
(n) Other. Such other insurance as may be reasonably requested by Lender.
III. Requirements of Insurance Policies.
(a) All insurance policies shall be issued by an insurer or insurers with
an X.X.Xxxx rating of A:X or better and a Standard and Poor's rating of "AA", or
equivalent rating from another agency acceptable to the Lender and be licensed
in the State of Ohio.
(b) The Property, Boiler and Machinery insurance policies shall also name
the Lender under a non-contributing New York standard Lender clause or an
equivalent endorsement satisfactory to the Lender and shall be otherwise
reasonably satisfactory to the Lender in form and content. Loss of Rental Income
insurance shall name the Lender as Loss Payee.
(c) All insurance acquired hereunder shall be with companies and in form,
amounts and with coverage and deductibles reasonably satisfactory to Lender and,
with respect to the insurance described in Section I (a), (c), (g) and (h) of
this Exhibit D, include a mortgagee's loss payable clause attached naming Lender
as mortgagee and loss payee and, with respect to all insurance described in
Section 11 (b) and (d) of this Exhibit D include an endorsement naming Lender as
an Additional Insured thereunder.
(d) All insurance policies shall contain coverage for improvements and
betterments which Borrower is required, in any Lease, to insure. All Property
insurance policies also shall include a co-insurance waiver and/or Agreed Amount
Endorsement. The amount of any deductible under any insurance policy must be
reasonably acceptable to the Lender. Without the Lender's prior written consent,
Borrower shall not name any person other than the Lender, as loss payee under
any Property insurance policies covering the improvements and such tenant
improvements and betterments that Borrower is required to insure pursuant to the
Lease, and Rental Income insurance. Borrower shall not carry separate or
additional insurance coverage covering the improvements and such tenant
improvements and betterments that Borrower is required to insure pursuant to the
Lease concurrent in form or contributing in the event of loss with that required
by this Agreement; provided that, if blanket policies are obtained, this
sentence shall not apply to property covered by such blanket policies other than
the improvements and such tenant improvements and betterments which Borrower is
required to insure pursuant to this Agreement.
(e) Borrower shall pay the premiums for the insurance policies as the same
become due and payable. Borrower shall deliver to the Lender certified copies of
the insurance policies required to be maintained pursuant to this Exhibit D
within thirty (30) days after the date of this Agreement or ten (10) days after
the issuance of the policies by the insurer, whichever is later, but in all
events, no later than sixty (60) days after the Closing Date, and failure to do
so will be an immediate Event of Default; provided, however, Lender shall not be
deemed by reason of the custody of such insurance policies to have knowledge of
the contents thereof. Borrower also shall deliver to the Lender, within ten (10)
days of the Lender's request, a certificate of the Borrower or the Borrower's
insurance agent setting forth the particulars as to all such insurance policies,
that all premiums due thereon have been paid currently and that the same are in
full force and effect. BORROWER SHALL DELIVER A CERTIFICATE OR OTHER EVIDENCE OF
INSURANCE ACCEPTABLE TO LENDER EVIDENCING THE INSURANCE REQUIRED HEREUNDER ON
THE CLOSING DATE, TOGETHER WITH RECEIPTS FOR THE PAYMENT OF PREMIUMS THEREON.
ALL CERTIFICATES MUST BE ON ACCORD FORM 27; CERTIFICATES EVIDENCING INSURANCE
WHICH ARE PRINTED ON ACCORD FORM 25 ARE NOT ACCEPTABLE BECAUSE THEY STATE THEY
ARE FOR INFORMATION PURPOSES ONLY. Not later than fifteen (15) days prior to the
expiration date of each of the insurance policies the Borrower shall deliver to
the Lender a certificate of insurance evidencing renewal of coverage as required
herein. Not later than sixty (60) days after the renewal of each of the
insurance policies, the Borrower shall deliver to the Lender an original or
certified copy (as required pursuant to this Section of a renewal policy or
policies. Within ten (10) days after such renewal, the Borrower shall deliver to
the Lender evidence of payment of premium satisfactory to the Lender.
(f) Each insurance policy shall contain a provision whereby the insurer:
(i) agrees that so long as the Loan is outstanding, such policy shall not be
canceled or terminated, the coverage, deductible, and limits of such policy
shall not be modified, other provisions of such policy shall not be modified is
such policy, after giving effect to such modification, would not satisfy the
requirements of this Agreement, and such policy shall not be canceled or fail to
be renewed, without in each case, at least thirty (30) days prior written notice
to the Lender, (ii) waives any right to claim any premiums and commissions
against the Lender, provided that the policy need not waive the requirement that
the premium be paid in order for a claim to be paid to the insured and (iii)
provides that the Lender is permitted to make payments to effect the
continuation of such policy upon notice of cancellation due to non-payment of
premiums. In the event any insurance policy (except for general public and other
liability and Workers Compensation insurance) shall contain breach of warranty
provisions, such policy shall provide that with respect to the interest of the
Lender, such insurance policy shall not be invalidated by and shall insure the
Lender regardless of (A) any act, failure to act or negligence of or violation
of warranties, declarations or conditions contained in such policy by any named
insured, (B) the occupancy or use of the premises for purposes more hazardous
than permitted by the terms thereof, or (C) any foreclosure or other action or
proceeding taken by the Lender pursuant to any provision of this Agreement.
(g) Any insurance maintained pursuant to this section may be evidenced by
blanket insurance policies covering the premises and other properties or assets
of the Borrower or its affiliates, provided that any such policy shall in all
other respects comply with the requirements of this section. Lender, in its
reasonable discretion, shall determine whether such blanket policies provide
sufficient limits of insurance.
EXHIBIT E
SUBORDINATION, ATTORNMENT AND NON-DISTURBANCE AGREEMENT
Prepared by and
after Recording
Return to:
Xxxxxxx Jared, Esq.
Xxxxxxxx & Xxxxxx, Ltd.
00 X. Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
SUBORDINATION, NON-DISTURBANCE
AND ATTORNMENT AGREEMENT
THIS SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT (this
"Agreement") made by and between ______________("Tenant"), CORUS BANK, N.A,
("Lender"), and BRE/City Center L.L.C., a Delaware limited liability company
("Landlord").
RECITALS:
A. By a certain Lease dated as of _____________(the "Lease"), Landlord, as
lessor, demised and leased to Tenant, as lessee, certain Leased Premises (the
"Leased Premises") which represents part of the improvements located or to be
located on the land legally described on Exhibit A attached hereto and by this
reference incorporated herein, upon the terms and conditions and for the rental,
as more fully set forth in the Lease.
B. Landlord, by its Mortgage, Assignment of Leases and Rents, Security
Agreement and Financing Statement (the "Mortgage"), recorded in the Office of
the Recorder of Deeds of Cuyahoga County, Ohio, grants and conveys unto Lender,
all of its right, title and interest in and to the Leased Premises to secure the
payment of its Note in the aggregate maximum principal amount of $67,000,000
payable to Lender, with principal and interest payable as therein provided and
as provided under the terms of that certain Construction Loan Agreement by and
between Landlord and Lender (the "Loan Agreement"). All references in this
Agreement and every other Loan Document to the Note, the Mortgage, the Loan
Agreement and each and every other Loan Document shall mean the Note, the
Mortgage, the Loan Agreement and each other Loan Document and all modifications,
amendments, supplements, extensions, replacements or restatements thereof or
thereto.
C. Lender, as a condition to making and continuing to make advances on the
loan has required the execution of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and to induce Lender to make said loan, the parties do hereby
covenant and agree as follows:
1. The Lease and all right and title of Tenant thereunder are and shall be
subject and subordinate to the lien of the Mortgage and to all renewals,
modifications, consolidations, replacements, and extensions thereof, to the full
extent of the principal sum secured thereby, interest thereon, and all other
amounts and sums secured thereby subject to the terms and conditions stated
herein. Tenant further waives all rights and claims to assert that the Lease or
any provision thereof is superior to the lien of or to any other provision of
the Mortgage or any renewal, increase, replacement, consolidation, modification
or extension thereof.
2. Notwithstanding such subordination, Tenant agrees that any action by the
Lender to enforce the Mortgage by reason of default thereunder will not
terminate the Lease (unless Lender elects to terminate the Lease in the event of
a default by Tenant which is not cured within any applicable cure period), or
invalidate or constitute a breach of any of the terms thereof, nor give rise to
any right of Tenant to terminate the Lease nor constitute a breach or
invalidation of the Lease. If the Mortgage shall be foreclosed, or a voluntary
conveyance in lieu of foreclosure shall be delivered, or a sale of the Leased
Premises pursuant to the rights granted to Lender in the Mortgage, Tenant does
hereby attorn to the successors and assigns of the Landlord (successors and
assigns being herein defined to include the Lender, Lender's nominee, assignee
and/or purchaser at any sale of the Leased Premises) provided Tenant's
attornment shall be to such successor landlord upon the same terms, covenants
and conditions as provided in the Lease and such successor landlord shall be
deemed to have assumed all of the obligations of Landlord to Tenant set forth in
the Lease, except as provided herein.
3. Tenant's attornment by these presents is effective and self-operative
without the execution of any other instruments on the part of the parties
hereto.
4. If the Lender (or any other party) shall acquire title to the Property
or shall succeed to Landlord's interest in the Lease, whether through
foreclosure of the Mortgage, conveyance in lieu of foreclosure, or otherwise,
Lender (or such other party) shall (a) not disturb Tenant's possession of the
Leased Premises and all right and title of Tenant under the Lease and all
amendments or modifications thereto approved in writing by Lender (the "Approved
Modifications") shall continue in full force and effect in accordance with their
terms and Lender (or such other party) shall recognize the Lease and the
Approved Modifications provided Tenant is not in default in the payment of any
sums due from Tenant under the Lease or performance of any material obligation
of Tenant under the Lease (beyond any period expressly given Tenant to cure such
default); and (b) except as may be required or necessary under the terms of any
applicable law or statute, not name Tenant in any action for foreclosure of the
Mortgage. Lender (or such other party) shall thereupon, and without the
necessity of further attornment or other act or agreement, be substituted as
Tenant's landlord under the Lease, and shall be entitled to the rights and
benefits and subject to the obligations thereof; provided that neither Lender
nor any other party (other than Landlord) shall be:
(a) liable for any act or omission of any prior landlord under the
Lease (including the Landlord) or damages (actual, punitive or
consequential) arising therefrom; or
(b) subject to any offsets or defenses which Tenant might have against
any prior landlord under the Lease (including the Landlord); or
(c) bound by any amendments or modification of the Lease made without
Lender's written consent; or
(d) bound by or required to credit Tenant with any prepayment of rent
more than thirty (30) days in advance or any deposit, rental security or
any other sums deposited with any prior landlord under the Lease (including
the Landlord) unless said sum is actually received by Lender; or
(e) liable for the completion of any construction of the Leased
Premises or tenant improvements to the Leased Premises commenced or agreed
to by any prior landlord (including Landlord); or
(f) liable for the payment of any damages, fees or penalties payable
by any landlord (including Landlord) to Tenant, including but not limited
to fees or penalties for failure to deliver the Leased Premises in a timely
fashion.
5. Tenant will deliver to Lender a copy of any notice of default served
upon Landlord by Tenant.
6. Tenant agrees that from and after the date hereof in the event of any
default under the Lease which would give Tenant the right, either immediately or
after the lapse of a period of time, to terminate the Lease, to claim a partial
or total eviction, or claim for abatement of rent, offset or other remedy,
notwithstanding any provision of the Lease to the contrary, Tenant will not
exercise any such right (a) until it has given written notice of such default to
Lender in accordance with Sections 5 and 18 of this Agreement, and (b) until and
unless Lender fails to remedy such act or omission within thirty (30) days after
receipt of Tenant's notice, or in the case of any other act or omission which
cannot reasonably be remedied within said thirty (30) day period, then Lender
shall have as long as reasonably necessary to remedy such act or omission,
provided that, (i) Lender commences such remedy and notifies Tenant within said
30day period of Lender's desire to remedy, and (ii) Lender pursues completion of
such remedy with due diligence following such giving of notice and following the
time when Lender shall have become entitled under the Mortgage to remedy the
same. It is specifically agreed that Tenant shall not, as to Lender, be entitled
to require cure of any default which is personal to Landlord, and therefore not
susceptible of cure by Lender, or which is specified in Section 4 of this
Agreement, and that no such uncured default shall entitle Tenant to exercise any
rights under the Lease with respect to Lender, including, without limitation any
rights of set-off, off-set, rent abatement or termination, but that the Lease
shall remain in full force and effect as between Lender and Tenant, except with
respect to the provisions which are personal as to Landlord.
7. Notwithstanding anything to the contrary contained in the Lease,
Landlord hereby irrevocably directs Tenant to make all payments of rent to
Landlord to an account at Corus Bank, N.A., 0000 X. Xxxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxx 00000 designated by Lender to Tenant by written notice to Tenant.
8. Tenant covenants and agrees as follows for the benefit and reliance of
Lender:
(a) That it will not, without the express written consent of Lender:
(i) cancel, terminate or surrender the Lease, except as expressly provided
therein, and then only after Lender has failed to or unsuccessfully
attempted to pursue its rights and remedies as provided herein; (ii) alter,
amend or modify any term of the Lease; (iii) enter into any agreement with
Landlord, its successors or assigns, which grants any concession with
respect to the Lease or which reduces the rent called for thereunder; or
(iv) consent to the release of any party having liability under the Lease.
(b) That Tenant shall, except to the extent prohibited by law or legal
proceedings, make rental payments under the Lease to Lender pursuant to and
upon written demand by Lender, if such demand states that a default has
occurred under the Mortgage, and Landlord agrees that any payments so made
to Lender shall be deemed to have been made in accordance with and in
satisfaction of Tenant's obligation to pay rent under the Lease.
9. Landlord and Tenant, hereby jointly and severally, agree for the benefit
and reliance of Lender, as follows:
(a) That neither this Agreement, the Mortgage, nor anything to the
contrary in the Lease, prior to Lender's acquisition of Landlord's interest
in and possession of the Leased Premises, operate to give rise to or create
any responsibility or liability for the control, care, management or repair
of the Leased Premises upon Lender, or impose responsibility for the
carrying out by Lender of any of the covenants, terms and conditions of the
Lease, nor shall said instruments operate to make Lender responsible or
liable for any waste committed on the Leased Premises by any party
whatsoever, or for dangerous or defective condition of the Leased Premises,
or for any negligence in the management, upkeep, repair or control of said
Leased Premises resulting in loss, injury or death to any lessee, licensee,
invitee, guest, employee, agent or stranger. Notwithstanding anything to
the contrary in the Lease, Lender, its successors and assigns or a
purchaser under the terms of the Mortgage, shall, subject to the terms of
this Agreement, be responsible for performance of only those covenants and
obligations of the Lease accruing after Lender's acquisition of Lessor's
interest in and possession of the Leased Premises. In no event shall Lender
be personally liable as Landlord under the Lease, either by virtue of any
assignment of the Lease, the exercise of any right thereunder or hereunder,
the foreclosure of its lien on the Leased Premises, the acquisition of the
Leased Premises or the collection of any rent under the Lease as owner or
beneficiary under the Mortgage, and Tenant shall look solely to the real
estate that is the subject of the Lease and to no other assets of Lender
for satisfaction of any liability in respect of the Lease; but Tenant shall
have reserved to it all other remedies available to it at law or in equity,
against Landlord.
(b) That in the event Lender gains title to the Leased Premises and
becomes substitute lessor, it is agreed that Lender may assign its interest
as substitute lessor without notice to or the consent of Tenant or any
other party hereto; provided that, no such assignment shall be binding upon
Tenant until written notice thereof is delivered to Tenant.
10. Nothing contained in this Agreement shall in any way impair or affect
the lien created by the Mortgage or any modifications, amendments, extensions or
renewals thereof.
11. Tenant agrees that this Agreement satisfies any condition or
requirement in the Lease relating to the granting of a non-disturbance
agreement.
12. Tenant covenants and acknowledges that, as of the date hereof, it has
no right or option of any nature whatsoever, whether pursuant to the Lease or
otherwise, to purchase the Leased Premises or the Property or any portion
thereof or any interest therein.
13. The foregoing provisions shall be self-operative. However, Tenant
agrees to execute and deliver to Lender, or any person to whom Tenant herein
agrees to attorn, such other instrument which is reasonably necessary to
effectuate such provisions provided such documents in no way diminish Tenant's
rights or increases Tenant's obligations hereunder or under the Lease.
14. Tenant hereby represents and warrants to Lender that it has not
subordinated the Lease or any of its rights under the Lease to any lien,
mortgage, deed of trust or deed to secure debt prior to the date hereof and that
it will not subordinate the Lease or the rights of the Lessee thereunder to any
lien, mortgage, deed of trust or deed to secure debt other than the Mortgage
without the prior written consent of Lender or until the lien of the Mortgage
has been released by Lender.
15. This Agreement may not be modified orally or in any other manner than
by an agreement in writing signed by the parties hereto, or their respective
successors in interest. This Agreement shall inure to the benefit of and be
binding upon the parties hereto, and their successors and assigns.
16. This Agreement may be signed in one or more counterparts, each of which
shall be an original, but all of which together shall constitute one agreement,
binding on all of the parties hereto notwithstanding that all of the parties
hereto are not signatories to the same counterpart. Each of the undersigned
parties authorizes the assembly of one or more original copies of this Agreement
through the combination of the several executed counterpart signature pages with
one or more bodies of this Agreement, including the Exhibits, if any, to this
Agreement. Each such compilation of this Agreement shall constitute one original
of this Agreement.
17. Tenant agrees that the Mortgage and the note evidencing the
indebtedness secured thereby may be increased, replaced, renewed, extended
and/or modified from time to time by agreement between Landlord and Lender and
Lender may exercise any one or more of its rights under the Mortgage from time
to time at Lender's discretion, all without notice to or consent of Tenant, and
this Agreement shall continue in full force and effect as to all such renewals,
extensions and/or modifications and all such exercise of rights.
18. Any and all notices given in connection with this Agreement shall be
deemed adequately given only if in writing and addressed to the party for whom
such notices are intended at the address set forth below. All notices shall be
sent by personal delivery, Federal Express or other overnight messenger service,
first class registered or certified mail, postage prepaid, return receipt
requested or by other means at least as fast and reliable as first class mail. A
written notice shall be deemed to have been given to the recipient party on the
earlier of (a) the date it shall be delivered to the address required by this
Agreement; (b) the date delivery shall have been refused at the address required
by this Agreement; or (c) with respect to notices sent by mail, the date as of
which the postal service shall have indicated such notice to be undeliverable at
the address required by this Agreement. Any and all notices referred to in this
Agreement, or which either party desires to give to the other, shall be
addressed as follows:
If to Landlord: BRE/City Center, L.L.C.
c/o Prime Group Realty Trust
00 Xxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx Xxxxxxxx, Co-President
With a copy to: c/o Prime Group Realty Trust
00 Xxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx Xxxxx
If to Lender: CORUS Bank, N.A.
0000 X. Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxxxxxxx, First Vice President
AND TO
CORUS Bank, N.A.
0000 X. Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxxxxx, Senior Vice President
and General Counsel
If to Tenant:
With copies to:
Any party hereto may, by notice given hereunder, designate any further or
different addresses to which subsequent notices, certificates or other
communications shall be sent.
The provisions of this Agreement shall bind, and inure to the benefit of, the
parties hereto and their respective heirs, successors and assigns.
The remainder of this page is intentionally left blank
IN WITNESS WHEREOF, the parties hereto have set their hands and seals on
the date set forth below.
TENANT:
__________________________________
By:__________________________________
Its:_______________________________
LENDER:
CORUS Bank, N.A.
By:__________________________________
Xxxx X. Xxxxxxx
Senior Vice President
LANDLORD:
BRE/City Center, L.L.C.,
a Delaware limited liability company
By: ________________________________
Its: ______________________________
EXHIBIT A
Legal Description
STATE OF ILLINOIS )
) SS:
COUNTY OF XXXX )
I, _______________________, a Notary Public within and for said County, in
the State aforesaid, duly commissioned and acting, do hereby certify that on
this _____ day of _____________,_____, personally appeared before me
___________, the ____________ President of CORUS Bank, N.A., to me personally
well known and known to be the person who signed the foregoing instrument, and
who, being by me duly sworn, stated and acknowledged that he is the
______________ President of said CORUS Bank, N.A., and that he signed and
delivered the same in behalf of CORUS Bank, N.A., with authority, as his and its
free and voluntary act and deed for the uses and purposes therein mentioned and
set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
___________________________
Notary Public
My commission expires:_____
STATE OF ILLINOIS )
) SS
COUNTY OF XXXX )
The Undersigned, a Notary Public within and for said County, in the State
aforesaid, duly commissioned and acting, do hereby certify that on this _____
day of _______________, 2000, personally appeared before me _______________, the
Senior Vice President of the administrative partner of the ________________ of
_______________, L.L.C., a Delaware limited liability company ("Company"), to me
personally well known and known to be the person who signed the foregoing
instrument, and who, being by me duly sworn, stated and acknowledged that _he is
the Senior Vice President of the administrative partner of the sole member of
said Company and that _he signed and delivered the same on behalf of said
Company, with authority, as his/her and its free and voluntary act and deed, and
as the free and voluntary act of said Company, for the uses and purposes therein
mentioned and set forth.
______________________________
Notary Public
MY COMMISSION EXPIRES:
_______________________
STATE OF _____________ )
) SS:
COUNTY OF ____________)
I,_________________________, a Notary Public within and for said County, in
the State aforesaid, duly commissioned and acting, do hereby certify that on
this _____ day of _____________, 200_, personally appeared before me
_____________, the ___________ President of __________, to me personally well
known and known to be the person who signed the foregoing instrument, and who,
being by me duly sworn, stated and acknowledged that he is the _____________
President of said corporation, and that he signed and delivered the same in
behalf of said corporation, with authority, as his and its free and voluntary
act and deed for the uses and purposes therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
___________________________
Notary Public
My commission expires: ________
EXHIBIT F
ESTOPPEL CERTIFICATE
TENANT ESTOPPEL CERTIFICATE
TO: BRE/City Center L.L.C.
c/o Prime Group Realty Trust
00 Xxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
RE: NATIONAL CITY CENTER (the "Property")
Ladies and Gentlemen:
The following statements are made with the knowledge that Prime Group
Realty, L.P., a Delaware limited partnership, and its assigns (individually and
collectively, as applicable, "Purchaser"), Corus Bank, N.A. its lender
("Lender") and/or investors are relying on them in connection with the
collateral assignment of the Lease (defined below) to Lender by Purchaser, and
Lender, its successors, assigns and successor owners of the Property may rely on
such statements for that purpose.
The undersigned ("Tenant"), being the Tenant under the Lease covering
certain premises (the "Leased Premises") in the Property, hereby certifies,
represents, warrants, covenants and agrees as follows:
1. Tenant is the tenant under a lease with ____________ as the original
landlord, dated ________________(collectively, the "Lease"). The Lease
demises to Tenant approximately ____________ rentable square feet in the
Property. By mesne conveyances Landlord is the successor in interest to the
original landlord under the lease The initial term of the Lease commenced
on ____________, and will expire on ___________ exclusive of unexercised
renewal options and extension options contained in the Lease. Tenant has
___________ options to extend the term of the Lease for __________ years
each. There have been no other amendments, modifications, revisions or
supplements to the Lease, and there are no other agreements of any kind
between Landlord and Tenant regarding the Leased Premises.
2. The Lease has been duly authorized and executed by Tenant and is in good
standing and in full force and effect. Attached is a true, correct and
complete copy of the Lease.
3. Tenant has accepted and is in sole possession of and is presently occupying
the Leased Premises. The Lease has not been hypothecated or assigned by
operation of law or otherwise by Tenant and no sublease, concession
agreement, license, use or other occupancy agreement covering the Lease
Premises, or any portion of the Leased Premises, has been entered into by
Tenant.
4. Tenant commenced paying rent on ____________. Tenant is currently obligated
to pay fixed or base rent under the Lease in the annual amount of
$____________, payable in advance, in equal monthly installments of
$__________. The Lease provides for Tenant to pay to Landlord as additional
rent ____% of any increase (the "Increase") in operating expenses and real
property taxes in excess of the _____ base year operating expenses and real
property taxes of $___________. Tenant currently is paying, monthly, in
advance, as additional rent under the Lease, equal installments (as
estimated by Landlord pursuant to the Lease) of the Increase in the amount
of $________. All rent has been paid under the Lease through _________,
200_. No rent under the Lease has been paid more than (1 ) month in
advance, and no other sums have been deposited with Landlord other than
$__________ deposited as security under the Lease. Such security deposit is
not subject to any set-off or reduction or any increase for interest or
other credit due to Tenant. Tenant is entitled to no rent abatement,
concessions, free rent, allowances for improvements, refurbishment or
otherwise or other similar compensation in connection with renting the
Leased Premises except as follows: None. Tenant has no setoffs, claims or
defenses to the enforcement of the Lease by Landlord and no deductions or
credits against rent under the Lease except as follows: None. Landlord has
not rebated, reduced or waived any amounts due from Tenant under the Lease,
nor has Landlord provided financing for, made loans or advances to, or
invested in Tenant's business. Tenant has no right of first refusal or
right to expand the premises subject to the Lease, except
_________________________.
5. Neither Landlord nor Tenant is in default under the Lease beyond any
applicable cure period and no event has occurred which, with the giving of
notice or passage of time, or both, could result in such default. As of the
date of this Estoppel certificate, there is no dispute between Landlord and
Tenant, and there is no litigation between Landlord and Tenant with respect
to the Lease or the Leased Premises, and there has been no litigation
between Landlord (or any predecessor landlord) and Tenant with respect to
the Lease or the Leased Premises or Tenant's use and occupancy thereof.
Tenant has not received any notice of any present violation of any federal,
state, county or municipal laws, regulations, ordinances, order or
directives relating to use, operation or condition of the Leased Premises
or the Property.
6. Except as specifically stated in the Lease, Tenant has not been granted (a)
any option to extend the term of the Lease, (b) any option to expand the
Leased Premises or to lease additional space within the Property, or (c)
any option or right of first refusal to purchase the Leased Premises or the
Building or any part thereof. Tenant has no option to terminate the Lease
as to the Leased Premises or any part or portion thereof prior to its
stated expiration except as follows: ________________________.
7. All obligations and conditions under the Lease to be performed to date by
Landlord have been satisfied, free of defenses and set-offs, including all
construction work and tenant improvements in the Leased Premises, and
Landlord has made all contributions, if any, required of Landlord under the
Lease. Landlord is not obligated to provide or construct any further tenant
improvements or other tenant allowances except as follows: None.
8. Tenant has not received any notice of a prior sale, transfer, assignment,
pledge or other hypothecation of the Leased Premises or the Lease or the
rents thereunder. Tenant has not (a) applied for the appointment of, or the
taking of possession by, a receiver, custodian, trustee or liquidator of
itself or of all or a substantial part of the Property, (b) admitted in
writing its inability to pay its debts as they become due, (c) made a
general assignment for the benefit of its creditors, (d) filed a voluntary
petition or commenced a voluntary case or proceeding under the Federal
Bankruptcy Code, (e) been adjudicated a bankrupt or insolvent, (f) filed a
petition seeking to take advantage of any other law relating to bankruptcy,
insolvency, reorganization, winding-up or composition or adjustment of
debts, (g) received any notice of any petition filed against it in an
involuntary case or proceeding under the Federal Bankruptcy Code, or (h)
taken any corporate, partnership, limited liability company or other action
for the purpose of effecting any of the foregoing.
9. Tenant is a ______________ organized, validly existing and in good standing
under the laws of ____________.
EXECUTED as of the ________ day of ____________, 200__.
TENANT
By:________________________
Name:______________________
Title:_____________________
EXHIBIT G
Inspecting Architect's Report
[INTENTIONALLY NOT INCLUDED]
SCHEDULE 3.4
PENDING LITIGATION
NONE
SCHEDULE 3.5
STATEMENT OF 2000 ACTUAL CASH FLOW
[INTENTIONALLY NOT INCLUDED]
SCHEDULE 5.18
MEZZANINE LOAN DOCUMENTS
1. Term Loan Agreement among Prime Group Realty, L.P. and Prime Group Realty
Trust and Fleet National Bank, as Agent and Lender's Party thereto dated
June 30, 2000
2. First Amendment to Term Loan Agreement dated August 29, 2000
3. Second Amendment to Term Loan Agreement dated September 29, 2000
4. Third Amendment to Term Loan Agreement dated December 15, 2000
5. Fourth Amendment to Term Loan Agreement dated March 29, 2001
6. Promissory Note in the original principal amount of $20,000,000 dated June
30, 2000 made by Prime Group Realty, L.P., as borrower in favor of Fleet
National Bank, as Lender
7. Pledge and Security Agreement dated as of June 30, 2000 made by Prime Group
Realty, L.P., in favor of Fleet National Bank, as Agent
8. Amended and Restated Pledge and Security Agreement by Prime Group Realty,
L.P., in favor of Fleet National Bank, as Agent
9. Pledge and Security Agreement dated as of December 15, 2000, by 000 Xxxxx
Xxxx. Mezzanine, L.L.C., in favor of Fleet National Bank, as Agent
10. Pledge and Security Agreement dated as of December 15, 2000, By Prime Group
Realty, L.P., in favor of Fleet National Bank, as Agent
11. Pledge and Security Agreement dated as of January 31, 2001, by Prime Group
Realty, L.P., in favor of Fleet National Bank, as Agent
12. Letter Agreement by and among Lennar Partners, Inc. and XxXxxxx-Xxxxx,
L.L.C. and Fleet National Bank, as Agent
13. Agreement regarding subsidiary among 000 Xxxxx Xxxx. Mezzanine, L.L.C.,
Prime Group Realty, L.P., as a Fleet National Bank, as Agent dated December
15, 2000
14. UCC Financing Statements
SCHEDULE 7.1(a)
EXISTING LEASES
[INTENTIONALLY NOT INCLUDED]
Schedule 7.1(b)
Omissions in Current Estoppels
None
Schedule 7.1(b-2)
Termination Rights of Xxxxx and Xxxxxxxxx
1. Termination rights are set forth in Sections 15, 18 and 39(f) of the
original lease and Section 13 and 14 of the Ninth Addendum to lease.
