EXHIBIT 10.38
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LOAN AGREEMENT
Dated as of December 20, 1999
by and among
THE LENDERS PARTIES HERETO,
as Lenders,
GOLDMAN SACHS MORTGAGE COMPANY,
as Syndication Agent for the Lenders,
THE BANK OF NOVA SCOTIA,
as Administrative Agent for the Lenders
and
THE BANK OF NOVA SCOTIA,
as Collateral Agent for the Lenders, and
GRAND CANAL SHOPS MALL SUBSIDIARY, LLC
as Borrower
TABLE OF CONTENTS
ARTICLE I. CERTAIN DEFINITIONS..............................................
Section 1.1. Definitions ..........................................
ARTICLE II. GENERAL TERMS...................................................
Section 2.1. The Loan .............................................
Section 2.2. Use of Proceeds.......................................
Section 2.3. Security for the Loans................................
Section 2.4. The Notes ............................................
Section 2.5. Principal and Interest................................
Section 2.6. Prepayment ...........................................
Section 2.7. Application of Payments After an Event of Default.....
Section 2.8. Method and Place of Payment...........................
Section 2.9. Collateral for Certain Tenant Claims; Deposits
Into and Withdrawals from SNDA Deposit Escrow
Account; Delivery of SNDAs............................
Section 2.10. Taxes ...............................................
Section 2.11. Mortgage Recording Taxes.............................
Section 2.12. Mall Retainage Escrow Account; Tax Escrow Accounts;
Insurance Escrow Account; Brokerage Commission
Account; TI Costs Account; Operating Expense
Account; Springing Cash Management Account............
Section 2.13. Regulatory Change, etc...............................
Section 2.14. Unavailability, etc..................................
ARTICLE III. CONDITIONS PRECEDENT...........................................
Section 3.1. Conditions Precedent to the Lender's Obligation to
Execute and Deliver this Agreement and to Make
the Loan..............................................
ARTICLE IV. REPRESENTATIONS AND WARRANTIES..................................
Section 4.1. Representations and Warranties........................
Section 4.2. Survival of Representations...........................
ARTICLE V. AFFIRMATIVE COVENANTS............................................
Section 5.1. Affirmative Covenants.................................
ARTICLE VI. NEGATIVE COVENANTS..............................................
Section 6.1. Negative Covenants....................................
ARTICLE VII. DEFAULTS.......................................................
Section 7.1. Event of Default......................................
Section 7.2. Remedies .............................................
Section 7.3. Remedies Cumulative...................................
ARTICLE VIII. RELATIONSHIP BETWEEN TRUST PROPERTY AND PHASE II OF MALL.....
Section 8.1.Notice Regarding Construction of Mall Phase II.........
Section 8.2.Lender Approval Right with respect to the COREA........
Section 8.3. Design Materials......................................
ARTICLE IX. THE AGENTS......................................................
Section 9.1. Appointment and Authorization of the Agents...........
Section 9.2. Agent and Affiliates.................................
Section 9.3. Consultation with Experts............................
Section 9.4. Liability of Agent...................................
Section 9.5. Indemnification......................................
Section 9.6. Indemnification......................................
Section 9.7. Indemnification......................................
Section 9.8. Credit Decision......................................
Section 9.9. Successor Agent......................................
Section 9.10. Standard of Care of the Collateral Agent etc........
Section 9.11. Agent's Fee ........................................
Section 9.12. Construction........................................
ARTICLE X. MISCELLANEOUS....................................................
Section 10.1. Survival ............................................
Section 10.2. Lender's Discretion..................................
Section 10.3. Governing Law........................................
Section 10.4. Modification, Waiver in Writing......................
Section 10.5. Delay Not a Waiver...................................
Section 10.6. Notices .............................................
SECTION 10.7. TRIAL BY JURY........................................
Section 10.8. Headings ............................................
Section 10.9. Assignments and Participations.......................
Section 10.10. Severability........................................
SECTION 10.10. Collateral .........................................
Section 10.11. Severability........................................
Section 10.12. Preferences ........................................
Section 10.13. Waiver of Notice....................................
Section 10.14. Borrower's Remedies.................................
Section 10.15. Exhibits Incorporated...............................
Section 10.16. Offsets, Counterclaims and Defenses.................
Section 10.17. No Joint Venture or Partnership.....................
Section 10.18. Waiver of Marshalling of Assets Defense.............
Section 10.19. Waiver of Counterclaim..............................
Section 10.20. Conflict; Construction of Documents.................
Section 10.21. Brokers and Financial Advisors......................
Section 10.22. Counterparts........................................
Section 10.23. Payment of Expenses.................................
Section 10.24. Non-Recourse........................................
Section 10.25. Servicer ...........................................
Section 10.26. Sharing of Set-Offs.................................
Section 10.27. Provisions Not for Benefit of Borrower..............
Section 10.28. Confidentiality.....................................
ARTICLE XI. SECURITIZATION..................................................
Section 11.1. Cooperation .........................................
ARTICLE XII. SUBORDINATION OF DEED OF TRUST TO CERTAIN EASEMENTS............
Section 12.1. Subordination........................................
Section 12.2. Costs and Expenses...................................
Exhibits
A - Note (Form)
B - Deed of Trust, Assignment of Leases and Rents, Security
Agreement and Fixture Filing (Form)
C - Assignment of Leases and Rents (Form)
D Environmental Indemnity (Form)
E - Principal Non-Recourse and Limited Environmental Matters
Carve-Out Guaranty (Form)
F - Contract Assignment (Form)
G - Cash Collateral Agreement (Form)
H - Principal Guaranty (Form)
I-1 - Retail Lease (Form)
I-2 Restaurant Lease (Form)
J-1 - Material Junior Loan Document Provisions
J-2 Junior Loan Estoppel Certificate
J-3 - Junior Loan Subordination Provisions
J-4 - Junior Loan Transfer Restrictions
K - Financial Statements (Form)
L - Scope Change Guaranty (Form)
M - Subordination Non-disturbance and Attornment Agreement
(Form)
N - Escrow Provisions
O - Funding Agents' Disbursement and Administration Agreement
P - Mall Retainage Pledge Agreement
Q - Certain Intellectual Property
R - [Intentionally omitted]
Schedules
A - Categories of Tangible Personal Property
B - Environmental Matters Schedule
C-1 - Existing Tenant Claims
C-2 - SNDA Required Leases
D-1 - Single-Purpose Entity Provisions (Borrower)
D-2 Single-Purpose Entity Provisions (Manager)
E - Independent Director Definition
F - [Intentionally Omitted]
G-1 - COREA Qualified Lease Requirements
G-2 - Pre-Approved COREA Qualified Leases
H-1 - SNDA Qualified Lease Requirements
H-2 - Pre-Approved SNDA Qualified Leases
I - Certain Takings
LOAN AGREEMENT
THIS LOAN AGREEMENT, dated as of December 20, is by and among
(i) the LENDERS from time to time parties hereto, (ii) GOLDMAN SACHS MORTGAGE
COMPANY, a New York limited partnership, having an address c/o Goldman, Sachs &
Co., 85 Broad Street, New York, New York 10004, as Syndication Agent, (iii) THE
BANK OF NOVA SCOTIA, a Canadian Chartered bank, having an address at 580
California Street, Suite 2100, San Francisco, California 94104, as
Administrative Agent, (iv) THE BANK OF NOVA SCOTIA, a Canadian Chartered bank,
having an address at 580 California Street, Suite 2100, San Francisco,
California 94104, as Collateral Agent, and (v) GRAND CANAL SHOPS MALL
SUBSIDIARY, LLC, a Delaware limited liability company, having its principal
place of business at 3355 Las Vegas Boulevard South, Las Vegas, Nevada 89109
(the "Borrower").
RECITALS
WHEREAS, pursuant to, and subject to the terms, conditions and
provisions of, the Loan Commitment Letter (as defined below), the Lenders have
agreed to make the Loan (as defined below) to Borrower;
WHEREAS, it is a condition, among others, of the Lenders
commitment to make the Loan, that the Borrower simultaneously executes and
delivers this Agreement, the Notes and the other Loan Documents (each as defined
below);
WHEREAS, the Lenders have retained the Collateral Agent, the
Administrative Agent and the Syndication Agent to perform certain duties for the
Lenders under the Loan Documents and the Collateral Agent, the Administrative
Agent and the Syndication Agent have agreed to perform such duties;
NOW, THEREFORE, in consideration of agreement by the Lenders
to make the Loan to the Borrower and the covenants, agreements, representations
and warranties set forth in this Agreement, the parties hereby covenant, agree,
represent and warrant as follows:
ARTICLE I.
CERTAIN DEFINITIONS
Section 1.1. Definitions. For all purposes of this Agreement:
(1) the capitalized terms defined in this Article I have the meanings assigned
to them in this Article I, and include the plural as well as the singular; (2)
all accounting terms have the meanings assigned to them in accordance with GAAP;
(3) 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; (4) the term "including" shall mean "including,
without limitation" and (5) the following terms have the following meanings:
"Acceptable Leasing Broker" means (A) a leasing brokerage
company that is then the exclusive leasing broker for first-class regional
shopping centers containing, in the aggregate, at least 10 million net rentable
square feet in the United States (exclusive of the Trust Property), (B) an
Affiliate of Borrower reasonably acceptable to Administrative Agent based upon
such Affiliate's employees' leasing brokerage experience and employment history
with one or more professional leasing brokerage companies that were, at the time
of each such employee's employment with the applicable compan(ies), the
exclusive leasing brokers for first-class regional shopping centers, or (C)
another Person acceptable to Administrative Agent (based upon the decision of
the Required Lenders) in its sole discretion.
"Acceptable Manager" means (A) Forest City Commercial
Management, Inc., (B) another professional management company that then manages
first-class regional shopping centers containing, in the aggregate, at least 10
million net rentable square feet in the United States (exclusive of the Trust
Property), (C) an Affiliate of Borrower reasonably acceptable to the
Administrative Agent based upon such Affiliate's employees' property management
experience and employment history with one or more professional property
management companies that, at the time of each such employee's employment with
the applicable compan(ies), managed first-class regional shopping centers, or
(D) another Person acceptable to Administrative Agent in its sole discretion
(based upon the decision of the Required Lenders).
"Accepted Practices" means such practices as commercial
mortgage collateral agents would follow in the normal course of their business
in performing administrative and custodial duties with respect to collateral
which is generally similar to the Collateral.
"Account Party Sideletter" means, with respect to any given
Letter of Credit, a document, in form and substance reasonably satisfactory to
Administrative Agent, pursuant to which the account party under the Letter of
Credit (x) covenants and agrees that until the Indebtedness shall have been
indefeasibly paid in full, such account party shall withhold exercise of any
claim, right or remedy, direct or indirect, that such account party shall then
or thereafter have against Borrower or any of its assets, in each case whether
such claim, right or remedy arises in equity, under contract, by statute, under
common law or otherwise (including, without limitation, any right of
subrogation, reimbursement, contribution or indemnification) arising in
connection with the Letter of Credit and (y) subordinates all claims against the
Borrower to those of the Lenders and of the Agents.
"Actual Rent" shall mean, for any period of time, with respect
to any COREA Qualified Lease, all minimum (i.e., exclusive of percentage or
additional) and percentage rent (but excluding any prepaid rent (other than
minimum rent for the first full calendar month and/or last calendar month of the
term of the applicable lease that was prepaid upon lease execution)) that was
actually paid by the tenant thereunder with respect to such period minus (x) in
the case of the Canyon Ranch Operating Lease, all rent that was payable under
the Canyon Ranch Master Lease for such period and (y) in the case of the Lutece
Operating Lease, all rent that was payable under the Lutece Master Lease for
such period.
"Adjacent Property Expense" means any expense or other amount
that is payable in connection with, or allocable to, the Real Property (or any
portion thereof) or any other property (in each case, other than the
Collateral); provided that amounts payable by the Borrower (v) pursuant to the
express terms of the ESA or (w) pursuant to the express terms of the REA (or
pursuant to separate agreements contemplated by the express terms of the REA or
the ESA and, in either case, executed in accordance with the terms of this
Agreement) shall not be deemed to constitute "Adjacent Property Expenses".
"Adjusted LIBOR" means, with respect to each Interest Accrual
Period, a rate of interest per annum obtained by dividing (i) LIBOR for such
Interest Accrual Period by (ii) a percentage equal to 100 percent minus the
Reserve Percentage then in effect, to the extent applicable to a particular
Lender.
"Administrative Agent" means Scotiabank, in its capacity as
administrative agent for the Lenders hereunder, and its successors in such
capacity.
"Affiliate" or "affiliate" of any specified Person means any
other Person controlling, controlled by or under common control with such
specified Person. For the purposes of this definition, "control" when used with
respect to any specified Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities or other beneficial interests, by contract or otherwise;
and the terms "controlling" and "controlled" have the meanings correlative to
the foregoing.
"Agents" means the collective reference to the Administrative
Agent, the Syndication Agent and the Collateral Agent.
"Agreement" means this Loan Agreement, as the same may from
time to time hereafter be modified, supplemented or amended.
"Amortization Achievement Date" the first date upon which (a)
the sum of (i) the then aggregate outstanding principal balance of the Loan plus
(ii) the then aggregate outstanding principal balance of the Junior Loan shall
equal (b) the sum of (i) the original principal amount of the Loan plus (ii) the
original principal amount of the Junior Loan (i.e. without giving effect to any
capitalization of accrued interest).
"Applicable Margin" means three and one-half percent (3.50%).
"Applicable Tax Percentage" means the highest aggregate
effective marginal rate of federal, state and local income tax or, when
applicable, alternative minimum tax (after giving effect to deductibility of
state and local taxes and the tax rate applicable to ordinary income and to
capital gains, as the case may be) to which any direct or indirect member or S
corporation shareholder of Borrower or the Junior Lender (if an Affiliate of
Borrower), as applicable, subject to the highest marginal rate of tax would be
subject in the relevant year of determination (as certified to the
Administrative Agent by a nationally recognized tax accounting firm), taking
into account only that member's or S corporation shareholder's share of income
and deductions attributable to its interest in Borrower or such Junior Lender,
as applicable.
"Appraisal" means that certain Complete Appraisal of Real
Property (Grand Canal Shoppes at Venetian) dated November 8, 1999 prepared for
Goldman Sachs Mortgage Company by Cushman & Wakefield of Oregon, Inc.
"Appraiser" means Cushman & Wakefield of Oregon, Inc. or any
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other nationally recognized appraiser acceptable to the Administrative Agent.
"Approval Criteria" means, as of any applicable date of
determination, that either (a)(i) Mall Phase I shall have been open for business
and operating for a period of at least twelve calendar months and (ii) the
Actual Rent that Borrower shall have actually received from tenants under COREA
Qualified Leases with respect to the then immediately preceding twelve (12)
calendar months plus Concession Income that Borrower shall have actually
received with respect to such twelve (12) calendar month period shall equal or
exceed $21,000,000, (b)(i) Mall Phase I shall have been open for business and
operating for a period of less than twelve calendar months (the period during
which Mall Phase I shall have been open for business and operating, the "Test
Period") and (ii) the sum of (A) the Actual Rent that Borrower shall have
actually received from tenants under COREA Qualified Leases with respect to the
Test Period plus the Concession Income that Borrower shall have actually
received with respect to the Test Period plus (B) the aggregate amount of
Projected Rent that tenants under COREA Qualified Leases and COREA Qualified
Lease Commitments shall be required to pay with respect to the portion of the
12-month period that follows the date upon which Mall Phase I shall have first
been open for business and operating which excludes the Test Period (the
"Projected Rent Period") plus the Concession Income reasonably projected by
Administrative Agent to be paid to Borrower for the Projected Rent Period shall
equal or exceed $21,000,000 or (c)(i) Mall Phase I shall not be open for
business or operating as of such date of determination and (ii) the aggregate
amount of Projected Rent that tenants under COREA Qualified Leases and COREA
Qualified Lease Commitments shall be required to pay with respect to the initial
period of twelve (12) calendar months following the opening of Phase I Mall for
business shall equal or exceed $21,000,000. For purposes of this definition,
Phase I Mall shall be deemed to have first been open for business and operating
on June 16, 1999.
"Approved COREA" shall mean a COREA that is approved by the
Administrative Agent in accordance with the terms of this Agreement.
"Assessment Date" shall mean the first date upon which the
Mall Space, the Retail Annex Land, the Mall and the Retail Annex, shall be
assessed, for real estate tax purposes, separately from any other portion of the
Real Property.
"Assignment of Leases and Rents" means that certain Assignment
of Leases and Rents in the form attached hereto as Exhibit C, dated as of the
Closing Date, granted by the Borrower to the Collateral Agent, for the benefit
of the Lenders, with respect to the Real Property, as same may from time to time
may be amended, supplemented, or otherwise modified.
"Automatically Qualified SNDA Lease" has the meaning given in
the definition of "SNDA Qualified Lease" contained herein.
"Bank" means a financial institution reasonably acceptable to
the Administrative Agent.
"Bank Account Collateral" means the collective reference to:
(i) all of the Borrower's right, title and interest in and to the Bank
Accounts and the Instruments and securities (including, without
limitation, Permitted Investments), if any, from time to time deposited
or held in the Bank Accounts or otherwise held by or for the benefit of
the Collateral Agent pursuant to the terms hereof;
(ii) all interest, dividends, Money, and other funds and other property from
time to time on deposit in the Bank Accounts or received, receivable or
otherwise payable in respect of, or in exchange for, the Bank Accounts
or Permitted Investments; and
(iii) to the extent not covered by clause (i) or (ii) above, all Proceeds of
any or all of the foregoing (except to the extent that such Proceeds
shall have been disbursed to Borrower from the Bank Accounts in
accordance with the provisions of the Loan Documents and applied in
accordance with the provisions of the Loan Documents).
"Bank Accounts" means the collective reference to the Tax
Escrow Account, the Cash Management Account, Management Fees Escrow Account, the
Brokerage Commission Account, the TI Costs Account and the Operating Expense
Account and the SNDA Deposit Escrow Account".
"Base Rate" means, at any time, 225 basis points above the
higher of (x) the Prime Rate or (y) the rate which is one half (1/2) of one
percent (1%) above the Federal Funds Rate.
"Billboard Additional Premises" means the premises demised
under the Billboard Master Lease.
"Billboard Master Lease" means that certain Master Lease for
Additional Billboard Space dated as of November 14, 1997 between Venetian, as
landlord, and Mall Construction, as tenant, as amended by that certain First
Amendment to Master Lease for Additional Billboard Space to Lease dated as of
July 23, 1999, the tenant's interest under which was assigned by Mall
Construction to Grand Canal pursuant to the that certain Assignment and
Assumption of Additional Billboard Space dated as of November 12, 1999 and
further assigned by Grand Canal to Borrower pursuant to that certain Assignment
and Assumption of Additional Billboard Space dated as of the date hereof, as the
same may be further amended, supplemented or otherwise modified from time to
time in accordance with the terms of the Deed of Trust.
"Billboard Operating Lease" means that certain Amended and
Restated Restaurant Lease dated as of June 26, 1997, as amended by that certain
First Amendment of Amended and Restated Restaurant Lease dated as of July 23,
1999, between Venetian, as landlord, and H&H of Nevada, LLC, as assignee of B.L.
International of Nevada, Inc. (inadvertently referred to as "B.L. of Las Vegas,
Inc." in such lease), as tenant, the landlord's interest under which was
assigned by Venetian to Mall Construction pursuant to that certain Assignment
and Assumption of Billboard Lease dated as of July 23, 1999 and further assigned
by Mall Construction to Grand Canal pursuant to that certain Assignment and
Assumption of Billboard Lease dated as of November 12, 1999 and further assigned
by Grand Canal to Borrower pursuant to that certain Assignment and Assumption of
Billboard Lease of even date herewith, as the same may be further amended,
supplemented or otherwise modified from time to time in accordance with the
terms hereof.
"Borrower" has the meaning provided in the first paragraph of
this Agreement.
"Borrowing Date" means the Closing Date.
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"Borrower's Certificate" means a certificate in favor of the
Lenders and the Agents which is signed by an authorized officer of the Borrower
on behalf of the Borrower.
"Breakage Costs" means, with respect to the prepayment or
repayment of any principal amount of the Loan (including, without limitation, as
a result of an Event of Default), the actual losses, costs and expenses
(including, without limitation, reasonable attorneys' fees, disbursements and
other expenses) suffered by the Lenders attributable to (i) the making of such
prepayment or repayment on a date other than a Payment Date, or (ii) the failure
of Borrower to give the notice required herein with respect to any prepayment
occurring on a Payment Date, in each case, as determined, in good faith, by each
Lender and communicated in writing to the Administrative Agent (who, in turn,
shall communicate the same to the Borrower). "Breakage Costs" shall include,
without limitation (but without duplication), (x) actual losses, costs and
expenses arising from interest, fees and other amounts payable by a Lender to
lenders of funds obtained by it in order to make or maintain its portion of the
Loan and (y) to the extent representing Lenders' actual losses, funds in an
amount equal to the excess, if any, of (i) the amount of interest that otherwise
would have accrued on the principal amount of the Loan so prepaid or repaid for
the period from the date of such prepayment or repayment to the last day of the
then current Interest Accrual Period (or, in the case of a prepayment on a
Payment Date without the required notice, the period from such Payment Date
through the end of the Interest Accrual Period which commences on such Payment
Date) at the rate of interest which would have been applicable herein over (ii)
the amount of interest that otherwise would have accrued on such principal
amount for such period at a rate per annum equal to LIBOR in effect two Business
Days prior to the date of such prepayment or repayment.
"Brokerage Agreement" means a brokerage agreement executed in
accordance with the provisions hereof, in any case, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with the
terms hereof.
"Brokerage Commissions" means brokerage commissions and fees
payable by Borrower in connection with Permitted Leases.
"Brokerage Commission Deposit" shall mean $605,800.
"Brokerage Commissions Account" has the meaning provided in
Section 2.12(d)(1).
"Business Day" means any day other than a day which is (i) a
Saturday or a Sunday or (ii) a day on which federally-insured depository
institutions are authorized or obligated by law, governmental decree or
executive order to be closed; provided that when used with respect to an
Interest Determination Date or an Interest Accrual Period, "Business Day" shall
mean a day on which banks in London, England and New York City, New York are
open for dealing in foreign currency and exchange.
"Canyon Ranch Additional Premises" means the premises demised
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under the Canyon Ranch Master Lease.
"Canyon Ranch Master Lease" means that certain Master Lease
for Additional Canyon Ranch Space dated as of June 1, 1998 between Venetian, as
landlord, and Mall Construction, as tenant, as amended by that certain First
Amendment to Master Lease for Additional Canyon Ranch Space dated as of June 1,
1998 between Venetian, as landlord, and Mall Construction, as tenant, the
tenant's interest under which was assigned by Mall Construction to Grand Canal
pursuant to that certain Assignment and Assumption of Master Lease for
Additional Canyon Ranch Space dated as of November 12, 1999 and further assigned
by Grand Canal to Borrower pursuant to that certain Assignment and Assumption of
Master Lease for Additional Canyon Ranch Space dated as of the date hereof, as
the same may be amended, supplemented or otherwise modified from time to time in
accordance with the terms of the Deed of Trust.
"Canyon Ranch Operating Lease" means that certain Lease dated
as of June 1, 1998 between Mall Construction, as landlord, and CR Las Vegas,
LLC, as tenant, the landlord's interest under which was assigned by Mall
Construction to Grand Canal pursuant to that certain Assignment and Assumption
of Canyon Ranch Lease dated as of November 12, 1999 and further assigned by
Grand Canal to Borrower pursuant to that certain Assignment and Assumption of
Canyon Ranch lease of even date herewith, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with the
terms hereof.
"Capital Expenditures" means costs of capital expenditures
(determined in accordance with GAAP) incurred or to be incurred, as the context
requires, by the Borrower in connection with replacements and capital
improvements and repairs made or to be made, as the context requires, to the
Real Property.
"Cash Collateral Agreement" means that certain Cash Collateral
Agreement, in the form of Exhibit G attached hereto, dated as of the date hereof
by the Borrower in favor of the Collateral Agent for the benefit of the Lenders,
as the same may be amended, supplemented or otherwise modified from time to
time.
"Cash Management Account" has the meaning given in Section
2.12(i)(ii).
"Casualty" means a fire or other casualty resulting in damage
to or destruction of, or other loss with respect to, the Real Property (or any
portion thereof).
"Casualty Consultant" has the meaning provided in subsection
5.l(X)(xiv).
"Closing Date" means the date hereof.
"Code" means the Internal Revenue Code of 1986, as amended,
and as it may be further amended from time to time, any successor statutes
thereto, and applicable U.S. Department of Treasury regulations issued pursuant
thereto in temporary or final form.
"Collateral" means, collectively, (a) fee title to the Mall
Space and to the Retail Annex Land, (b) fee title to the Mall Improvements, (c)
the leasehold estate in the Billboard Additional Premises created pursuant to
the Billboard Master Lease, the leasehold estate in the Canyon Ranch Additional
Premises created pursuant to the Canyon Ranch Master Lease and the leasehold
estate in the Lutece Additional Premises created pursuant to the Lutece Master
Lease, (d) the Bank Account Collateral, (e) the Mall Retainage Escrow Account
Collateral, (f) the Leases and Rents, (g) the Contracts (as defined in the
Contract Assignment), (h) the Interest Rate Cap Agreement, (i) the remainder of
the Trust Property (as defined in the Deed of Trust) and (j) all other property,
rights and interests which are or hereafter may become subject to a Lien in
favor of the Collateral Agent for the benefit of the Lenders as security for the
Indebtedness.
"Collateral Agent" means Scotiabank, in its capacity as
collateral agent for the Lenders hereunder, and its successors in such capacity.
"Collateral Security Instruments" means all Liens, rights,
documents and instruments given as security for the Loan, including, without
limitation, the Deed of Trust, the Assignment of Leases and Rents, the Manager's
Subordination, the Broker's Subordination, the Contract Assignment, the
Retainage Pledge Agreement and the Cash Collateral Agreement, as any or all of
the foregoing may be amended, supplemented or otherwise modified from time to
time.
"Commercially Reasonable Owner" means a commercially
reasonable and prudent owner of the Collateral (and no other property, rights or
interests) (assuming that, at the time in question, such owner, and each holder
of a direct or indirect interest in such owner, has equity in the Collateral).
"Common Charges" shall mean all common charges, assessments,
fees and other charges, of every kind and nature whatsoever, general and
special, ordinary and extraordinary, unforeseen and foreseen, which at any time
may be validly assessed, levied, confirmed or imposed on the Borrower and/or the
Property under the REA or any other Property Agreement.
"Common Facilities" shall have the meaning given in the Deed
of Trust.
"Competing Facility" means a Convention/Trade Show Facility
that is located in the City of Las Vegas and/or County of Clark, State of Nevada
(other than (a) the "Sands Exposition and Convention Center" and (b) meeting and
conference facilities that (i) are not used for conventions, trade shows,
expositions, or other shows or exhibitions of the type generally held at the
"Sands Exposition and Convention Center" (unless (x) the facilities in question
shall not be located on the Land, and (y) less than fifteen percent (15%) of the
total revenues generated by such facilities shall be derived from shows or
expositions of the type generally held at the "Sands Exposition and Convention
Center"), (ii) constitute an ancillary part of a hotel and (iii) the aggregate
net rentable square footage of which is less than 150,000 square feet).
"Competitor" means a Person that (i) owns or operates (or is
an Affiliate of an entity that owns or operates) a casino located in Nevada or
New Jersey, a shopping center or mall located in Nevada or a Competing Facility
and/or (ii) is a union pension fund.
"Concession Income" means, with respect to any given period of
time, fees paid or payable, as the context requires, by third party members of
the general public (e.g., excluding officers, directors, members, shareholders,
partners, and employees of Borrower or any Affiliate thereof) for rides on the
gondolas that traverse the canals at the Mall (the "Gondola Concession")
operated at the Mall by Borrower, provided that any such fee was paid pursuant
to an arms-length transaction.
"Condemnation Proceeds" means, in the event of a Taking, the
proceeds in respect of such Taking, less (x) the applicable REA Lender(s)' and
the Trustee's actual and reasonable out-of-pocket costs of recovering and paying
out such proceeds in accordance with the provisions of this Agreement and of the
REA(including, without limitation, reasonable attorney's fees and expenses) and
(y) the applicable REA Owner(s)' actual and reasonable out-of-pocket costs of
recovering such proceeds in accordance with the terms of this Agreement and of
the REA (including, without limitation, reasonable attorney's fees and
expenses).
"Contingent Obligation" means any obligation of the Borrower
guaranteeing any indebtedness, leases, dividends or other obligations ("primary
obligations") of any other Person (the "primary obligor") in any manner, whether
directly or indirectly. Without limiting the generality of the foregoing, the
term "Contingent Obligation" shall include any obligation of the Borrower,
whether or not contingent:
(i) to purchase any such primary obligation or any property constituting
direct or indirect security therefor;
(ii) to advance or supply funds (x) for the purchase or payment of any such
primary obligation or (y) to maintain working capital or equity capital
of the primary obligor;
(iii) to purchase property, securities or services primarily for the purpose
of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation; or
(iv) otherwise to assure or hold harmless the owner of such primary
obligation against loss in respect thereof.
The amount of any Contingent Obligation shall be deemed to be
an amount equal to the portion of the stated or determinable amount of the
primary obligation in respect of which such Contingent Obligation is made which
is then outstanding or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof (assuming the Borrower is required to
perform thereunder) as determined by the Administrative Agent in good faith.
"Contract Assignment" means that certain Assignment of
Contracts, Licenses, Permits, Agreements, Warranties and Approvals in the form
attached hereto as Exhibit F, dated as of the Closing Date and executed by the
Borrower in favor of the Collateral Agent for the benefit of the Lenders, as the
same may from time to time be amended, supplemented, extended or otherwise
modified.
"Convention/Trade Show Facility" means any or all of the
following: a convention, meeting, conference, exposition and/or exhibition
center or facility, or any other facility that provides space for or to
conventions, expositions, meetings, conferences, trade shows or other shows or
exhibitions of the type generally held at the "Sands Exposition and Convention
Center".
"COREA" means a construction, operation and reciprocal
easement agreement between Borrower and Mall II Sub with respect to Mall Phase I
and Mall Phase II, (a) which agreement, among other things, (i) is an agreement
that a Commercially Reasonable Owner of Mall Phase I would execute, (ii)
contains guidelines relating to the design of Mall Phase II (including, without
limitation, the connection(s) between Mall Phase I and Mall Phase II), and
relating to alterations and maintenance of Mall Phase I and Mall Phase II, so
that, among other things, the malls are architecturally harmonious and
constructed and maintained in a first-class manner, (iii) provides for the joint
maintenance, leasing, marketing, management and operation, by one third-party
property manager and one third-party leasing agent, of Mall Phase I and Mall
Phase II, (iv) requires each mall owner to pay (A) all operating and other
expenses that are directly allocable to its mall and (B) an equitable portion of
all operating and other expenses that are not directly allocable to either mall
but otherwise relate to the "integrated mall" ("Shared Expenses"), (v) provides
for approval of a leasing plan and, with respect to all operating expenses that
should appropriately be Shared Expenses, an operating budget prior to
commencement of operation of Mall Phase II and each year thereafter, (vi)
provides that each of Borrower and Mall II Sub is entitled to receive and
retain, for its own account, all revenue generated by Mall Phase I or Mall Phase
II, as applicable, (vii) allows each mall owner to sell and finance its mall,
and, in connection therewith, to assign or mortgage its interest in the COREA,
(viii) provides for the granting of appropriate easements across each mall
owner's property, (ix) contains provisions relating to restoration of the malls
after casualty and condemnation and (x) contains a mechanism to resolve disputes
under the COREA and (b) the execution and performance of which will not be
likely to cause a Material Adverse Effect, provided that, if the Approval
Criteria are satisfied, the Administrative Agent shall not assert that execution
and performance of the COREA is likely to cause a Material Adverse Effect as a
result of the fact that, notwithstanding Mall Sub I and Mall Sub II's compliance
with the terms of the COREA, (1) tenants in Mall Phase II and tenants in Mall
Phase I may compete for the same customers and/or (2) prospective tenants may
elect to lease space in Mall Phase II rather than in Mall Phase I.
"COREA Qualified Lease" means, as of any date of
determination, a Lease (i)(a) that substantially conforms to the applicable
(e.g., retail or restaurant) standard lease form attached hereto as Exhibit I-1
or Exhibit I-2, as applicable (with such changes thereto as both (x) a
Commercially Reasonable Owner would agree to and (y) are not likely to result in
a Material Adverse Effect), provided that in no event shall such changes include
a right of the tenant to terminate the Lease (except for rights to terminate,
due to a Casualty or Taking, that both a Commercially Reasonable Owner would
agree to and that are not likely to result in a Material Adverse Effect)), (b)
which, in the case of a Lease that was theretofore entered into, is in full
force and effect and under which there is no monetary default or material
non-monetary default and (c) that complies with the provisions of Schedule G-1
attached hereto (as such provisions may be changed from time to time with the
prior consent of the Administrative Agent (which consent shall not be
unreasonably withheld or delayed)) or (ii) is otherwise approved by the
Administrative Agent (which approval shall not be unreasonably withheld or
delayed); provided that, notwithstanding the foregoing, each Lease described on
Schedule G-2 hereto shall be deemed to be a "COREA Qualified Lease" so long as,
at the time in question, such Lease is in full force and effect and there is no
monetary default or material non-monetary default under such Lease.
"COREA Qualified Lease Commitment" shall mean a binding
commitment (other than a Lease) from a tenant to lease space in the Mall
Improvements, which commitment is acceptable to the Administrative Agent in its
sole discretion.
"COREA Rent" means, with respect to any determination as to
whether the Approval Criteria are satisfied, the collective reference to all
Actual Rent and Projected Rent that is relevant to such determination.
"Deed of Trust" means that certain Fee and Leasehold Deed of
Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing, in
the form attached hereto as Exhibit B, dated as of the Closing Date, granted by
the Borrower to Lawyers Title of Nevada, Inc. for the benefit of the Collateral
Agent for the benefit of the Lenders with respect to the Trust Property as
security for, among other things, the Indebtedness, as the same may from time to
time be amended, supplemented, extended or otherwise modified.
"Default" means the occurrence of any event which, but for the
giving of notice or the passage of time, or both, would be an Event of Default.
"Default Rate" means the per annum interest rate equal to the
lesser of (i) the Interest Rate plus 4.00% per annum or (ii) the maximum
interest rate which the Borrower may by law pay or the applicable Lender or
Lenders may charge and collect under applicable Legal Requirements.
"Deposit Date" means the first Business Day of each calendar
month.
"Disbursement Agent" shall have the meaning given in the
FADAA.
"Dollars" means dollars in lawful currency of the United
States of America.
"Debt Service" shall mean, for any period of six calendar
months, the aggregate amount of interest that was payable in respect of the Loan
with respect to such period.
"DSCR" shall mean, for any period of six calendar months, an
amount equal to the quotient of (A) DSCR NOI with respect to such period divided
by (B) Debt Service with respect to such period.
"DSCR Event" has the meaning provided in Section 2.12(i)(i).
"DSCR Materials" has the meaning provided in Section 2.12(i)(i)
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"DSCR Period" has the meaning provided in Section 2.12(i)(i)
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"DSCR NOI" shall mean, for any period of six calendar months,
the excess of (A) DSCR Revenues for such period over (B) DSCR Operating Expenses
for such period.
"DSCR Operating Expenses" shall mean, for any period of six
calendar months, as determined in accordance with sound accounting principles
consistently applied, the sum of (A) all Operating Expenses actually expended by
Borrower in respect of the Trust Property (or required to be expended by
Borrower in order to maintain and operate the Trust Property as required under
the Loan Documents) during such period plus (B) $700,000.
"DSCR Revenues" shall mean, for any period of six calendar
months, as determined in accordance with sound accounting principles
consistently applied, all Rents actually received by Borrower during such
period.
"Eligible Account" means a bank account located at the Bank
that is separate and identifiable from all other funds held by the Bank. An
Eligible Account shall not be evidenced by a certificate of deposit, passbook or
other instrument.
"Eligible Institution" means an institution whose commercial
paper, short-term debt obligations or other short-term deposits have at least
the third highest rating given by a nationally recognized statistical rating
agency selected by the Administrative Agent (e.g., a rating of "A" by S&P).
"Environmental Auditor" means EMG or such other Independent
environmental auditor as shall be selected by Borrower and approved by the
Administrative Agent (which approval shall not be unreasonably withheld or
delayed).
"Environmental Claim" means any written notice, notification,
request for information, claim, administrative, regulatory or judicial action,
suit, judgment, demand or other written communication by any Person or
Governmental Authority alleging or asserting liability with respect to the
Borrower, or any Real Property (whether for damages, contribution,
indemnification, cost recovery, compensation, injunctive relief, investigatory,
response, remedial or cleanup costs, damages to natural resources, personal
injuries, fines, penalties or otherwise) arising out of, based on or resulting
from (i) the presence, Use or Release into the environment of any Hazardous
Substance at any location (whether or not owned, managed or operated by the
Borrower or any Affiliate thereof), (ii) any fact, circumstance, condition or
occurrence forming the basis of any violation, or alleged violation, of any
Environmental Law or (iii) any alleged injury or threat of injury to health,
safety or the environment.
"Environmental Indemnity" means that certain Environmental
Health and Safety Indemnity Agreement in the form attached hereto as Exhibit D,
dated as of the Closing Date and executed by the Borrower in favor of the
Lenders and the Agents, as the same may from time to time be amended,
supplemented, extended or otherwise modified.
"Environmental Laws" means any and all present and future
federal, state or local laws, statutes, ordinances, rules or regulations, any
judicial or administrative orders, decrees or judgments, and any permits,
approvals, licenses, registrations, filings and authorizations, in each case as
now or hereafter in effect and pertaining to (a) the protection of the indoor or
outdoor environment, (b) the conservation, management or use of natural
resources and wildlife, (c) the protection or use of surface water and
groundwater, (d) the management, manufacture, possession, presence, use,
generation, transportation, treatment, storage, disposal, release, threatened
release, abatement, removal, remediation or handling of, or exposure to, any
hazardous or toxic substance or material or (e) pollution (including any release
to air, land, surface water and groundwater), and including, without limitation,
the Comprehensive Environmental Response, Compensation, and Liability Act of
1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42
USC 9601 et seq., Solid Waste Disposal Act, as amended by the Resource
Conservation and Recovery Act of 1976 and Hazardous and Solid Waste Amendment of
1984, 42 USC 6901 et seq., Federal Water Pollution Control Act, as amended by
the Clean Water Act of 1977, 33 USC 1251 et seq., Clean Air Act of 1966, as
amended, 42 USC 7401 et seq., Toxic Substances Control Act of 1976, 15 USC 2601
et seq., Hazardous Materials Transportation Act, 49 USC App. 1801 et seq.,
Occupational Safety and Health Act of 1970, as amended, 29 USC 651 et seq., Oil
Pollution Act of 1990, 33 USC 2701 et seq., Emergency Planning and Community
Right-to-Know Act of 1986, 42 USC 11001 et seq., National Environmental Policy
Act of 1969, 42 USC 4321 et seq., Safe Drinking Water Act of 1974, as amended,
42 USC 300(f) et seq., any analogous implementing or successor law, and any
analogous state or local law, as well as any amendment, rule, regulation, order
or directive issued thereunder.
"Environmental Liens" has the meaning provided in Section
4.l(Q).
"Environmental Reports" means a "Phase I Environmental Site
Assessment" (and, if determined by an Environmental Auditor to be necessary, a
"Phase II Environmental Site Assessment" and further site assessments) as
referred to in the ASTM Standards on Environmental Site Assessments for
Commercial Real Estate, E 1527-94 (or any successor thereto published by ASTM),
and an asbestos survey (including random sampling of materials and air quality
testing), with respect to the Real Property, prepared by an Environmental
Auditor and delivered to the Administrative Agent and any amendments,
supplements or other modifications thereto delivered to the Administrative
Agent.
"Equipment" means all "equipment" as defined in the UCC, now
or hereafter owned by the Borrower or in which the Borrower has or shall acquire
an interest, now or hereafter located on, attached to or contained in or used or
usable in connection with the Real Property, and shall also mean and include all
building materials, construction materials, personal property constituting
furniture, fittings, appliances, apparatus, leasehold improvements, machinery,
devices, interior improvements, appurtenances, cars, trucks, equipment, plant,
furnishings, fixtures, computers, electronic data processing equipment,
telecommunications equipment and other fixed assets now owned or hereafter
acquired by the Borrower and now or hereafter used in the operation of the
business conducted at the Real Property (including, without limitation,
curtains, draperies, carpets and rugs, screens, awnings, shades and blinds,
furniture, furnishings, equipment, chairs, chests, desks, bookcases, tables,
hangings, pictures, divans, couches, ornaments, electrical equipment, lamps,
mirrors, heating and lighting fixtures and equipment, steam and hot water
boilers, engines, generators, cooling systems, air conditioning machines, fire
prevention and extinguishing apparatus, security systems, elevators, escalators
and fittings, printing presses, individual motor drives for machines, pipes,
radiators, plumbing fixtures, and all similar and related articles located in
the bathrooms, halls, closets, offices, lobbies, basements and cellars, vaults
and other portions of the Real Property, and paper goods, brochures, office
supplies, stationery, consumable goods, soap, toiletry, and other operational
supplies in the Real Property), and all Proceeds thereof and as well as all
additions to, substitutions for, replacements of or accessions to any of the
items recited as aforesaid and all attachments, components, parts (including
spare parts) and accessories, whether installed thereon or affixed thereto, and
wherever located, now or hereafter owned by the Borrower and used or intended to
be used in connection with, or with the operation of, the Real Property or the
buildings, structures, or other improvements now or hereafter located at the
Real Property, or in connection with any construction being conducted or which
may be conducted thereon, all regardless of whether the same are located on the
Real Property or are located elsewhere (including, without limitation, in
warehouses or other storage facilities or in the possession of or on the
premises of a bailee, vendor or manufacturer) for purposes of manufacture,
storage, fabrication or transportation and all extensions and replacements to,
and proceeds of, any of the foregoing.
"Equipment Financing" has the meaning given within the
definition of "Equipment Lien".
"Equipment Lease" means a lease between a Person that is not
an Affiliate of Borrower, as lessor, and Borrower, as lessee, (i) that solely
covers Equipment located at, and used in connection with, the Mall Improvements,
(ii) that contains fair market terms, provisions and conditions (including,
without limitation, those pertaining to the payment of rent and other amounts)
and (iii) the leasehold estate under which the Collateral Agent shall hold, for
the benefit of the Lenders, pursuant to the Deed of Trust, a perfected first
priority Lien on, securing the payment of the Indebtedness and the Borrower's
other obligations under the Loan Documents.
"Equipment Lien" means a Lien granted by Borrower, as
borrower, to a Person that is not an Affiliate of Borrower, as lender, (i) that
solely encumbers Equipment located at, and used in connection with, the Mall
Improvements and (ii) that solely secures repayment of a loan made to the
Borrower, the proceeds of which were used solely to purchase such Equipment and
the terms, provisions and conditions of which are "fair market" (such loan, an
"Equipment Financing"); provided that no such Lien shall encumber any such
Equipment unless the Collateral Agent shall hold, pursuant to the Deed of Trust,
a perfected second priority Lien (i.e. second only to such Equipment Lien) for
the benefit of the Lenders, securing the payment of the Indebtedness and the
Borrower's other obligations under the Loan Documents.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated thereunder.
Section references to ERISA are to ERISA, as in effect at the date of this
Agreement and, as of the relevant date, any subsequent provisions of ERISA,
amendatory thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" means any Person or trade or business that
is a member of any group of organizations (i) described in Section 414(b) or (c)
of the Code of which the Borrower is a member and (ii) solely for purposes of
potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11) of
the Code and the lien created under Section 302(f) of ERISA and Section 412(n)
of the Code, described in Section 414(m) or (o) of the Code of which the
Borrower is a member.
"ESA" means the collective reference to (i) that certain
Energy Services Agreement dated as of May 1, 1997 between Atlantic-Pacific, Las
Vegas, LLC and Mall Construction, as amended pursuant to that certain Energy
Services Agreement Amendment No. 1 dated as of July 1, 1999, as the same was
assigned by Mall Construction to Grand Canal pursuant to that certain Assignment
of Contracts, Intangible Personal Property and Utility Deposits dated as of
November 12, 1999 and as the same was further assigned by Grand Canal to
Borrower pursuant to Assignment of Contracts, Licenses, Permits, Agreements,
Warranties and Approvals dated as of the date hereof, as the same may be further
amended, supplemented or otherwise modified from time to time in accordance with
the provisions hereof and (ii) Easement Agreement dated as of November 14, 1997
between Mall Construction and Atlantic-Pacific, Las Vegas, LLC, as the same was
assigned by Mall Construction to Grand Canal pursuant to Assignment of
Contracts, Licenses, Permits, Agreements, Warranties and Approvals dated as of
November 12, 1999 and as the same was further assigned by Grand Canal to
Borrower pursuant to Assignment of Contracts, Licenses, Permits, Agreements,
Warranties and Approvals dated as of the date hereof, as the same may be
amended, supplemented or otherwise modified from time to time in accordance with
the provisions hereof.
"Event of Default" has the meaning provided in Section 7.1.
"Excess Cash Flow" means, for any period of time, the excess
of (i) Operating Income for such period over (ii) the sum of (A) Operating
Expenses for such period plus (B) amounts paid or required under the Loan
Documents to be paid by the Borrower during such period in respect of the
Indebtedness plus (C) Capital Expenditures paid or required under the terms of
the Loan Documents to be paid by the Borrower during such period (except to the
extent paid using funds in any of the Bank Accounts (other than the Cash
Management Account) or the Mall Retainage Escrow Account in accordance with the
terms, provisions and conditions hereof) plus (D) amounts deposited or required
to be deposited by Borrower during such period, in accordance with the terms of
the Loan Documents, into the REA Insurance Premium Account, the Tax Escrow
Account, the Management Fees Account, the TI Costs Account, the Mall Retainage
Escrow Account or any other accounts (other than the Cash Management Account),
as applicable (the amounts described in this clause (D), collectively, "Required
Reserves").
"Existing Environmental Report" means that certain Phase I
Environmental Site Assessment of The Venetian Casino Resort 3355 Las Vegas
Boulevard South Las Vegas, Nevada 89109 prepared by EMG for GSMC, having EMG
Project No. 65910 and dated December 7, 1999.
"FADAA" means that certain Funding Agents' Disbursement and
Administration Agreement among LVSI, Venetian, Mall Construction, Scotiabank, as
bank agent, First Trust National Association, as indenture trustee, Mall
Construction Lender, Atlantic-Pacific, Las Vegas, LLC and Scotiabank, as
disbursement agent, as affected by that certain FADAA Limited Waiver dated as of
November 12, 1999 among Scotiabank, as bank agent, Mall Construction Lender,
Scotiabank, as Disbursement Agent, Venetian, LVSI, Mall Construction and
Principal. With respect to the FADAA, for purposes of the Loan Documents,
notwithstanding anything to the contrary contained in the FADAA, or in the Loan
Documents: (i) capitalized terms that are used in any Loan Document and defined
by reference to the FADAA shall have the respective meanings ascribed in the
FADAA as the FADAA existed on November 14, 1997, with such amendments,
supplements and other modifications thereto as shall be approved by the
Administrative Agent in writing, (ii) references in any Loan Document to
sections, paragraphs, terms or provisions of the FADAA shall mean such sections,
paragraphs, terms or provisions, as applicable, of the FADAA, with such
amendments, supplements and other modifications thereto as shall be approved by
the Administrative Agent in writing, (iii) the "Construction Consultant" shall
mean Tishman Construction Corporation of Nevada, a Nevada corporation, and any
replacement thereof selected in accordance with the provisions of the FADAA,
provided that such replacement must be acceptable to the Administrative Agent
(which consent will not be unreasonably withheld), (iv) the "Project Architect"
shall mean the collective reference to TSA of Nevada, LLP, and WAT&G, Inc.
Nevada, and any replacement thereof selected in accordance with the provisions
of the FADAA, provided that such replacement must be acceptable to the
Administrative Agent (which consent will not be unreasonably withheld), and (v)
when any document, instrument, agreement or other writing is referred to in any
definition of any term that is contained in the FADAA and incorporated by
reference into any Loan Document (e.g., the term "Project Documents")(each, a
"Referenced Document"), only such amendments, supplements or other modifications
of such Referenced Document that are approved by Administrative Agent (which
approval, other than with respect to Plans and Specifications, shall not be
unreasonably withheld) shall be included in such definition for purposes of the
Loan Documents. The foregoing shall not be deemed to prohibit the parties to the
FADAA (x) from amending, supplementing or otherwise modifying the FADAA without
the Administrative Agent's approval (to the extent permitted by the FADAA),
provided that the term "FADAA", as used in any Loan Document, shall not include
such amendments, supplements or other modifications and, for purposes of reading
and construing the Loan Documents, no effect shall be given to such amendments,
supplements or other modifications or (y) from amending, supplementing or
otherwise modifying any Referenced Document without the Administrative Agent's
approval (to the extent permitted by the FADAA), provided that the reference to
such Referenced Document, as incorporated by reference into any Loan Document,
shall not include such amendments, supplements or other modifications and, for
purposes of reading and construing the Loan Documents, no effect shall be given
to such amendments, supplements or other modifications.
"Federal Funds Rate" means, for any day, the rate set forth in
the weekly statistical release designated at H.15(519), or any successor
publication, published by the Federal Reserve Board (including any such
successor, "H.15(519)"), for such day opposite the caption "Federal Funds
(Effective)". If on any relevant day such rate is not yet published in
H.15(519), the rate for such day will be the rate set forth in the daily
statistical release designated as the Composite 3:30 p.m. Quotations for U.S.
Government Securities, or any successor publication, published by the Federal
Reserve Bank of New York (including any such successor, the "Composite 3:30 p.m.
Quotation") for such day under the caption "Federal Funds Effective Rate." If on
any relevant day the appropriate rate for such previous day is not yet published
in either H.15(519) or the Composite 3:30 p.m. Quotations, the rate for such day
will be the arithmetic mean of the rates for the last transaction in overnight
Federal funds arranged prior to 9:00 a.m. (New York time) on that day by each of
three leading brokers of Federal funds transactions in New York City selected by
the Administrative Agent.
"First Class Mall" means, at any given time, a Venetian-theme
retail and restaurant complex of the highest standards and quality (by reference
to recognized standards with respect thereto then prevailing in Clark County,
Nevada; provided that, if, at any given time, the REA shall require Borrower to
operate or manage the Trust Property with reference to standards or at a level
of quality that is higher than that which would otherwise be imposed by this
Agreement (without giving effect to this proviso), then Borrower shall be
required to operate and manage the Trust Property at such higher standards or
quality.
"Fiscal Year" means the 12-month period ending on December
31st (or, in the case of the first fiscal year, the shorter period from the
Closing Date through such date) of each calendar year or such other fiscal year
of the Borrower as the Borrower may select from time to time with the prior
consent of the Administrative Agent (which consent shall not be unreasonably
withheld or delayed).
"Funds" shall mean immediately available funds.
"GAAP" means generally accepted accounting principles in the
United States of America as of the date of the applicable financial report,
consistently applied.
"Governmental Authority" means any national or federal
government, any state, regional, local or other political subdivision thereof
with jurisdiction over the Person or property in question and any Person,
including any regulatory or administrative authority or court, with jurisdiction
over the Person or property in question exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.
"Grand Canal" means Grand Canal Shops Mall, LLC, a Delaware
limited liability company.
"GS&Co." means Goldman, Sachs & Co., a New York limited
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partnership.
"GSMC" means Goldman Sachs Mortgage Company, a New York
limited partnership.
"Hazardous Substances" means the collective reference to (i)
all petroleum or petroleum products or waste oils, explosives, flammable or
radioactive materials, asbestos, urea formaldehyde foam insulation,
polychlorinated biphenyls ("PCBs"), lead in drinking water, and lead-based
paint, (ii) all chemicals or other materials or substances which are now or
hereafter become defined as or included in the definitions of "hazardous
substances", "hazardous wastes", "hazardous materials", "extremely hazardous
wastes", "restricted hazardous wastes", "toxic substances", "toxic pollutants",
"contaminants", "special wastes", "regulated wastes", "pollutants" or words of
similar import under any Environmental Law and (iii) all other chemicals or
materials or substances, exposure to which is now or hereafter prohibited,
limited or regulated under any Environmental Law.
"Impositions" means all taxes (including, without limitation,
all real estate, ad valorem, sales (including those imposed on lease rentals),
use, single business, gross receipts, value added, intangible transaction
privilege, privilege or license or similar taxes), assessments (including,
without limitation, all assessments for public improvements or benefits, whether
or not commenced or completed within the term of the Loan), ground rents, water,
sewer or other rents and charges, excises, levies, fees (including, without
limitation, license, permit, inspection, authorization and similar fees), and
all other governmental charges, in each case whether general or special,
ordinary or extraordinary, foreseen or unforeseen, of every character,
(including, without limitation, all interest and penalties thereon), which at
any time prior to, during or in respect of the term hereof may be assessed or
imposed on or in respect of or be a Lien upon (i) the Borrower (including all
income, franchise, single business or other taxes imposed on the Borrower for
the privilege of doing business in the jurisdiction in which the Real Property,
or any other collateral delivered or pledged to the Collateral Agent in
connection with the Loan, is located) or any Agent or any Lender, (ii)(A) the
Collateral, or any other collateral delivered or pledged to the Collateral Agent
in connection with the Loan, or any part thereof or any Rents therefrom or any
estate, right, title or interest therein, or (B) to the extent the same shall
constitute a stamp, mortgage recording, intangibles or similar tax, fee or
charge, any Loan Document or the making and/or recordation of any Loan Document
or (iii) any occupancy, operation, use or possession of, or sales from, or
activity conducted on, or in connection with the Collateral or the leasing or
use of the Collateral or any part thereof, or the acquisition or financing of
the acquisition of the Collateral by the Borrower; provided that "Impositions"
shall not include net income taxes or gross receipts or franchise taxes (imposed
in lieu of net income taxes) imposed on any Agent or any Lender.
"Improvements" has the meaning provided in the Deed of Trust.
"Indebtedness" means, at any time, the then Outstanding
Principal Indebtedness, together with all other obligations and liabilities due
or to become due to any Agent or any Lender pursuant hereto, under any Note or
under or in accordance with any of the other Loan Documents, and all other
amounts, sums and expenses then or thereafter payable to any Agent or any Lender
hereunder or pursuant to any Note or any of the other Loan Documents.
"Indemnified Parties" has the meaning provided in Section
5.1(I).
"Independent" means, when used with respect to any Person, a
Person who (i) does not have any direct or indirect financial interest in the
Collateral, in Borrower or in any Affiliate of the Borrower or in any
constituent, shareholder, or beneficiary of the Borrower, and (ii) is not
connected with the Borrower, the Principal or any Affiliate of the Borrower or
the Principal or any constituent, shareholder, or beneficiary of the Borrower as
an officer, employee, promoter, underwriter, trustee, partner, director or
person performing similar functions.
"Independent Director" has the meaning given on Schedule E
attached hereto.
"Independent Expert" means an appropriately licensed and/or
registered (as applicable), reputable and independent, architect or engineer
that is not affiliated with the Borrower or the Principal (or any Affiliate of
either) or the Administrative Agent or any Lender (or any Affiliate of either)
having at least ten (10) years of relevant experience and expertise with respect
to large commercial real estate projects in Las Vegas, Nevada and/or Clark
County, Nevada and who is reasonably acceptable to the Administrative Agent and
the Borrower.
"Index Maturity" has the meaning provided in the definition of
LIBOR.
"Information" has the meaning provided in subsection 5.1(W).
"Initial Interest Period" has the meaning provided in Section
2.
"Instruments" means (i) all "instruments" as defined in the
UCC, "chattel paper" as defined in the UCC, or letters of credit, evidencing,
representing, arising from or existing in respect of, relating to, securing or
otherwise supporting the payment of, any of the Collateral (including, without
limitation, promissory notes, drafts, bills of exchange and trade acceptances)
and chattel paper obtained by the Borrower in connection with the Collateral
(including, without limitation, all ledger sheets, computer records and
printouts, data bases, programs, books of account and files of the Borrower
relating thereto) and (ii) notes or other obligations of indebtedness owing to
the Borrower from whatever source arising, in each case now owned or hereafter
acquired by the Borrower.
"Insurance Policies" means, at any given time, the collective
reference to the insurance policies then required to be maintained by REA Owners
and/or the Trustee under the REA.
"Insurance Premiums" has the meaning provided in Section
5.1(X)(ii).
"Insurance Proceeds" means, in the event of a fire or other
casualty or other loss with respect to the Real Property (or any portion
thereof), the proceeds received under any insurance policy maintained or
required to be maintained under the REA, less (x) the REA Lenders' and the
Trustee's actual reasonable out-of-pocket costs of recovering and paying out
such proceeds in accordance with the terms of this Agreement and of the REA
(including, without limitation, reasonable attorneys' fees and expenses) and (y)
the applicable REA Owner(s)' actual reasonable out-of-pocket costs of recovering
such proceeds in accordance with the terms of this Agreement and of the REA
(including, without limitation, reasonable attorney's fees and expenses).
"Insurance Requirements" means all terms of any insurance
policy required pursuant to the REA, this Agreement or the Deed of Trust, all
requirements of the issuer of any such policy and all regulations and then
current standards applicable to or affecting the Real Property or any part
thereof or any use or condition thereof, which may, at any time, be recommended
by the Board of Fire Underwriters, if any, having jurisdiction over the Real
Property, or such other body exercising similar functions.
"Insured Casualty" has the meaning provided in subsection
5.1(X)(x).
"Interest Accrual Period" means, in connection with the
calculation of interest accrued with respect to any specified Payment Date, (i)
initially, the Initial Interest Period and (ii) thereafter, the period from and
including the preceding Payment Date to but excluding such specified Payment
Date, provided, however, that no Interest Accrual Period shall extend beyond the
Maturity Date. Solely for purposes of this definition, the day next following
the last day of the Initial Interest Period shall be deemed to be a "Payment
Date".
"Interest Determination Date" means, in connection with the
calculation of interest accrued for any Interest Accrual Period, the second
Business Day preceding the first day of such Interest Accrual Period.
"Interest Rate" has the meaning provided in subsection 2.5(a).
"Interest Rate Cap Agreement" means any interest rate cap
agreement that Borrower enters into in accordance with the provisions of
subsection 5.1(T).
"Inventory" means all "inventory" as defined in the UCC from
time to time owned by Borrower or any Affiliate thereof, whether now or
hereafter existing or acquired, and which arises out of or is used in connection
with, directly or indirectly, the ownership and operation of the Collateral (or
any portion thereof), all Documents (as defined in the UCC) representing the
same and all proceeds and products of such Inventory. Without limiting the
generality of the foregoing, the term "Inventory" shall include, without
limitation:
(i) all goods, merchandise, raw materials, work in process and other
personal property, wherever located, now or hereafter owned or held by
the Borrower for manufacture, processing, the providing of services or
sale, use or consumption in the operation of the Collateral (or any
portion thereof) (including, without limitation, fuel, supplies and
similar items and all substances commingled therewith or added
thereto); and
(ii) all rights and claims of the Borrower against anyone who may store or
acquire the Inventory for the account of Borrower, or from whom
Borrower may purchase the Inventory.
"Junior Lender" means SGA Development, Inc., a Nevada
-------------
corporation and any successor or assign permitted under the Junior Loan Transfer
Restrictions.
"Junior Loan" means that certain loan in the principal amount
of $35,000,000, the other material terms of which are set forth on Exhibit J-1
attached hereto (the "Material Junior Loan Document Provisions").
"Junior Loan Documents" means loan documents relating to the
Junior Loan, which loan documents shall consist of a loan agreement, a
promissory note, a deed of trust, a collateral assignment of contracts, an
assignment of leases and rents, and an environmental indemnity, which loan
documents shall (i) be between Borrower, as borrower, and Junior Lender, as
lender, (ii) shall contain the Material Junior Loan Document Provisions and
(iii) shall contain such other terms, provisions and conditions as the
Administrative Agent shall approve (which approval shall not be unreasonably
withheld or delayed so long as such other terms, provisions and conditions are
not inconsistent with the Material Junior Loan Document Provisions), as any or
all of such loan documents may be amended, extended, supplemented or otherwise
modified from time to time in accordance with the terms hereof.
"Junior Loan Estoppel Certificate" means the certificate, in
the form of Exhibit J-2 attached hereto, from the Junior Lender and Borrower in
favor of the Collateral Agent for the benefit of the Lenders and the Agents.
"Junior Loan Subordination Provisions" shall mean the terms,
conditions and provisions set forth on Exhibit J-3 attached hereto.
"Junior Loan Transfer Restrictions" shall mean the terms,
conditions and provisions set forth on Exhibit J-4 attached hereto.
"Leases" means all leases, subleases, lettings, underlettings,
occupancy agreements, rental agreements, concession agreements, tenancies,
licenses by the Borrower as landlord, lessor or licensor of the Trust Property
or any part thereof now or hereafter entered into, and all amendments,
extensions, renewals and all other modifications thereof, and all guaranties
thereof and all security therefor.
"Leasing Broker" means any individual or entity appointed in
accordance with the terms hereof to procure tenants for the Trust Property
pursuant to a Brokerage Agreement.
"Leasing Broker's Subordination" means an agreement, executed
and delivered by the relevant Leasing Broker, in form and substance reasonably
satisfactory to the Administrative Agent, pursuant to which such Leasing Broker
subordinates its Brokerage Agreement, and all of its rights, interests and
remedies thereunder, to the Loan Documents and to the Indebtedness, as the same
may be amended, supplemented or otherwise modified from time to time.
"Legal Requirements" means all governmental statutes, laws,
rules, orders, regulations, ordinances, judgments, decrees and injunctions of
Governmental Authorities (including, without limitation, Environmental Laws)
affecting the Borrower, the Trust Property or any part thereof or the
construction, use, alteration or operation thereof, or any part thereof (whether
now or hereafter enacted and in force), and all permits, licenses and
authorizations and regulations relating thereto, at any time in force affecting
the Borrower or the Trust Property or any part thereof (including any which may
(i) require repairs, modifications or alterations in or to the Trust Property or
any part thereof, or (ii) in any way limit the use and enjoyment thereof).
"Lender" means each lender listed on the signature pages
hereof, each Assignee which becomes a Lender pursuant to the terms hereof and
their respective successors.
"Lending Office" means, as to each Lender, such office as such
Lender may from time to time designate as its Lending Office by notice to the
Borrower and the Administrative Agent.
"Letter of Credit" shall mean an unconditional, irrevocable,
and transferable demand letter of credit, in form and substance reasonably
satisfactory to the Administrative Agent, issued by and drawn on a bank that is
acceptable to the Administrative Agent, for the account of the Principal (or an
Affiliate thereof), and the beneficiary of which shall be the Collateral Agent
for the benefit of the Lenders, together with all replacements hereof satisfying
the provisions of this definition.
"LIBOR" means the rate per annum calculated as set forth
below:
(i) On each Interest Determination Date, LIBOR for the next Interest
Accrual Period will be determined on the basis of the offered rate for
a period of one month (the "Index Maturity"), commencing on such
Interest Determination Date, which appears on Telerate Page 3750 as of
11:00 a.m., London time (or such other page as may replace the Telerate
Page on that service for the purposes of displaying London interbank
offered rates of major banks).
(ii) With respect to an Interest Determination Date on which no such offered
rate appears on Telerate Page 3750 as described in (i) above, LIBOR for
the next Interest Accrual Period shall be the arithmetic mean,
expressed as a percentage, of the offered rates for deposits in U.S.
dollars for the Index Maturity which appears on the Reuters Screen LIBO
Page as of 11:00 a.m., London time, on such date.
(iii) With respect to an Interest Determination Date on which no such
offered rate appears on Telerate Page 3750 or on the Reuters Screen
LIBO Page, LIBOR for the next Interest Accrual Period shall be a rate
determined by the Administrative Agent as the arithmetic mean (rounded
upward, if necessary, to the nearest one hundredth of a percentage
point) of the rates quoted at approximately 11:00 A.M., London time, on
such Interest Determination Date, by four major banks in the London
interbank market, selected by the Administrative Agent in its sole
discretion, to prime banks in the London interbank market for one-month
Dollar deposits commencing on such Interest Determination Date and in a
principal amount equal to an amount that is representative for a single
transaction in such market at such time; provided, that the
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Administrative Agent will request the principal London office of each
of such four major banks to provide a quotation of its rate; provided,
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further, that if at least two such quotations are provided, the rate
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for such Interest Accrual Period will be the arithmetic mean of such
quotations, and if fewer than two quotations are provided as requested,
the rate for such Interest Accrual Period will be the arithmetic mean
of the rates quoted by major banks in New York City, selected by the
Administrative Agent in its sole discretion, at approximately 11:00
A.M., New York City time, on the Interest Determination Date for loans
in Dollars to leading European banks with a one-month maturity
commencing on such Interest Determination Date in a principal amount
equal to an amount that is representative for a single transaction in
such market at such time.
(iv) If on any Interest Determination Date the Administrative Agent is
required but unable to determine LIBOR in the manner provided in
paragraphs (i), (ii) and (iii) above, the Administrative Agent shall
not be liable to any party therefor, and the Base Rate shall be
substituted in lieu of LIBOR plus the Applicable Margin.
All percentages resulting from any calculations referred to in this
definition will be rounded upwards, if necessary, to the nearest
multiple of 1/100 of 1% and all U.S. dollar amounts used in or
resulting from such calculations will be rounded to the nearest cent
(with one-half cent or more being rounded upwards).
"Lien" means, with respect to any property, any mortgage, deed
of trust, lien (statutory or other), pledge, hypothecation, assignment,
preference, priority, security interest, or any other encumbrance or charge on
or affecting such property or any portion thereof, or any estate or interest
therein (including, without limitation, any conditional sale or other title
retention agreement, any financing lease having substantially the same economic
effect as any of the foregoing, the filing of any financing statement or similar
instrument under the UCC or comparable law of any other jurisdiction, domestic
or foreign, and mechanic's, materialmen's and other similar liens and
encumbrances).
"Limited Payment Guaranty" means that certain Limited Payment
Guaranty in the form attached hereto as Exhibit H, dated as of the Closing Date
and executed by the Principal, as the same may from time to time be amended,
supplemented, extended or otherwise modified.
"Loan" means the loan in the principal amount of $105,000,000
to be made, subject to the terms and conditions contained herein, by the Lenders
to the Borrower on the Closing Date.
"Loan Amount" means an amount equal to $105,000,000.
"Loan Commitment Letter" that certain letter agreement dated
as of November 14, 1997 among Goldman Sachs Mortgage Company, Grand Canal and
the Principal relating to the Loan, as the same may have been amended,
supplemented or otherwise modified.
"Loan Commitment Percentage" means, for any given Lender, the
fraction, represented as a percentage, the numerator of which is the portion of
the Outstanding Principal Indebtedness then held by such Lender and the
denominator of which is the aggregate Outstanding Principal Indebtedness. As of
the date hereof, the Loan Commitment Percentage of each Lender is the percentage
identified as such in the signature pages hereto.
"Loan Documents" means the collective reference to this
Agreement, the Notes, the Deed of Trust, the Contract Assignment, the Cash
Collateral Agreement, the Limited Payment Guaranty, the Scope Change Guaranty,
the Manager's Subordination, the Broker's Subordination, the Assignment of
Leases and Rents, the Environmental Indemnity, the Principal Non-Recourse
Carve-Out and Limited Environmental Matters Guaranty, the Mall Retainage Escrow
Agreement, the Mall Retainage Escrow Pledge Agreement, and all other agreements,
instruments, certificates and documents evidencing, securing or otherwise
relating to the Loan to which Borrower, the Principal and/or an Affiliate of
either shall be a party, as any or all of the same may be amended, extended,
supplemented or otherwise modified from time to time.
"Losses" has the meaning provided in subsection 5.1(J).
"Loss Proceeds" means Condemnation Proceeds and/or Insurance
-------------
Proceeds, as applicable.
"LVSI" means Las Vegas Sands, Inc., a Nevada corporation.
----
"Lutece Additional Premises" means the premises demised under
the Lutece Master Lease.
"Lutece Master Lease" means that certain Master Lease for
Additional Lutece Space dated as of May 20,1999 between Venetian, as landlord,
and Mall Construction, as tenant, the tenant's interest under which was assigned
by Mall Construction to Grand Canal pursuant to the that certain Assignment and
Assumption of Master Lease for Additional Lutece Space dated as of November 12,
1999 by and between Mall Construction and Grand Canal and further assigned by
Grand Canal to Borrower pursuant to that certain Assignment and Assumption of
Master Lease for Additional Lutece Space dated as of the date hereof, as the
same may be further amended, supplemented or otherwise modified from time to
time in accordance with the terms of the Deed of Trust.
"Lutece Operating Lease" means that certain Lease dated as of
May 20, 1999 between Venetian and Mall Construction, as landlord, and Las Vegas
Lutece Corp., as tenant, Venetian's interest under which was assigned by
Venetian to Mall Construction pursuant to that certain Assignment and Assumption
of Lutece Lease dated as of May 20, 1999, further assigned by Mall Construction
to Grand Canal pursuant to that certain Assignment and Assumption of Lutece
Lease dated as of November 12, 1999 and further assigned by Grand Canal to
Borrower pursuant to that certain Assignment and Assumption of Lutece Lease of
even date herewith, as the same may be further amended, supplemented or
otherwise modified from time to time in accordance with the terms hereof
"Madame Tussaud Lease" shall mean that certain Lease dated as
of May 15, 1998 by and between Mall Construction, as landlord and Madame Tussaud
Las Vegas Inc., a Delaware corporation dba Madame Tussaud Las Vegas, as Tenant.
"Mall" has the meaning provided in the Deed of Trust.
"Mall Construction" means Grand Canal Shops Mall Construction,
LLC, a Delaware limited liability company.
"Mall Construction Lender" means Salomon Brothers Realty
------------------------
Corp., as successor-in-interest to GMAC Commercial Mortgage Corporation.
"Mall Holdings" means Grand Canal Shops Mall Holding Company,
-------------
LLC, a Delaware limited liability company.
"Mall Improvements" has the meaning provided in the Deed of
Trust.
"Mall Phase I" shall mean the Trust Property (as its exists
immediately prior to the commencement of the construction of Mall Phase II).
"Mall Phase II" shall mean a first-class shopping mall (A)
that is physically connected to the Trust Property at one or more locations and
(B) the architecture of which, and the theme with respect to which, is
harmonious with that of Mall Phase I.
"Mall Retainage Escrow Account" has the meaning provided in
Section 2.12(a) hereof.
"Mall Retainage Escrow Account Collateral" means the
collective reference to:
(i) all of the Borrower's right, title and interest in and to the Mall
Retainage Escrow Account and the Instruments and securities (including,
without limitation, Permitted Investments (as defined in the Mall
Retainage Escrow Agreement)), if any, from time to time deposited or
held in the Mall Retainage Escrow Account or otherwise held by or for
the benefit of the Disbursement Agent pursuant to the terms of the Mall
Retainage Escrow Agreement;
(ii) all interest, dividends, Money, and other funds and other property from
time to time on deposit in the Mall Retainage Escrow Account or
received, receivable or otherwise payable in respect of, or in exchange
for, the Mall Retainage Escrow Account or Permitted Investments (as
defined in the Mall Retainage Escrow Agreement); and
to the extent not covered by clause (i) or (ii) above, all
Proceeds of any or all of the foregoing (except to the extent that such Proceeds
shall have been disbursed to Borrower from the Mall Retainage Escrow Account in
accordance with the provisions of the Mall Retainage Escrow Agreement and the
Mall Retainage Escrow Pledge Agreement and applied in accordance with the
provisions thereof).
"Mall Retainage Escrow Agreement" means that certain Mall
Retainage/Punchlist Escrow Agreement dated as of November 12, 1999 by and
between Mall Construction and Grand Canal and consented to by Mall Construction
Lender, as the same was assigned by Grand Canal to Borrower pursuant to that
certain Assignment and Assumption of Mall Retainage/Punchlist Escrow Agreement
dated as of the date hereof and by Mall Construction Lender to Collateral Agent
pursuant to that certain Assignment & Assumption of Mall Retainage/Punchlist
Escrow Agreement dated as of the date hereof.
"Mall Retainage Pledge Agreement" means that certain pledge
and security agreement in the form of Exhibit P attached hereto dated as of the
date hereof, which creates in favor of Collateral Agent a perfected first
priority security interest on the Mall Retainage Escrow Account and the Mall
Retainage Escrow Collateral, as the same may be amended, supplemented or
otherwise modified from time to time.
"Mall Retainage Punchlist Amount" means $422,562.50.
-------------------------------
"Mall Space" has the meaning provided in the Deed of Trust.
"Mall II Sub" shall mean an Affiliate of the Principal that,
at the time in question, (A) owns or leases the space in which and/or the land
upon which, as applicable, Mall Phase II will be or was, as applicable,
constructed and (B) owns (or if construction of Mall Phase II shall not have
therefore been commenced, will, upon commencement of construction of Mall Phase
II, own) Mall Phase II.
"Management Agreement" with respect to the Initial Manager,
that certain Management Agreement dated as of July 24, 1997 between Initial
Manager and LVSI and, with respect to each successor Manager appointed in
accordance with the terms hereof, a property management agreement executed in
accordance with the provisions hereof in any case, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with the
terms hereof.
"Management Fees" means management fees that are payable under
the Management Agreement.
"Manager" means Forest City Commercial Management, Inc. (the
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"Initial Manager") or any successor Manager appointed in accordance with the
---------------
terms hereof.
"Manager's Subordination" an agreement, executed and delivered
by the relevant Manager, in form and substance reasonably satisfactory to the
Administrative Agent, pursuant to which such Manager subordinates its Management
Agreement, and all of its rights, interests and remedies thereunder, to the Loan
Documents and to the Indebtedness, as the same may be amended, supplemented or
otherwise modified from time to time.
"Managing Member" means Grand Canal Shops Mall MM Subsidiary,
---------------
Inc., a Nevada corporation.
"Material Adverse Effect" means any event or condition that
has a material adverse effect upon (i) the business operations of the Borrower,
taken as a whole, the Collateral, taken as a whole, the assets of the Borrower,
taken as a whole, or the condition (financial or otherwise) of the Borrower,
taken as a whole, (ii) the ability of the Borrower or the Principal to perform
any of its material obligations under the Loan Documents, (iii) the
enforceability, validity, perfection or priority of the Lien of any Loan
Document or (iv) the value of the Collateral (or of any Lender's or any Agent's
interest therein) or the operation thereof.
"Maturity Date" means the earlier to occur of (i) December 20,
2002 or (ii) the date upon which the Loan shall be due and payable pursuant to
the terms of the Loan Documents.
"Member" means any direct or indirect member of Borrower or
Managing Member.
"Money" means all moneys, cash, rights to deposit or savings
accounts or other items of legal tender obtained from or for use in connection
with the operation of the Collateral.
"Moody's" means Moody's Investor Service, Inc.
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"Multiemployer Plan" means a multiemployer plan defined as
such in Section 3(37) of ERISA to which contributions have been, or were
required to have been, made by the Borrower or any ERISA Affiliate and which is
covered by Title IV of ERISA.
"Notes" means the collective reference to the promissory notes
of the Borrower, substantially in the form of Exhibit A hereto, each of which is
payable to the order of a Lender and in a principal amount equal to such
Lender's Loan Commitment Percentage of the Loan Amount (or, where a Lender holds
multiple Notes, all of which are, in the aggregate, in a principal amount equal
to such Lender's Loan Commitment Percentage), as any or all of such notes may
from time to time be amended, supplemented, severed, renewed, extended or
otherwise modified; "Note" means any one of such promissory notes, as such note
may from time to time be amended, supplemented, severed, renewed, extended or
otherwise modified.
"Notices" has the meaning provided in Section 10.6.
"Operating Expense Deposit" shall mean $5,000,000.
"Operating Expense Revenue Achievement Date" shall mean the
first date occurring on or after the Closing Date upon which the Approval
Criteria shall be satisfied.
"Operating Expense Account" has the meaning provided in
Section 2.12(h)(1).
"Operating Expenses" means, with respect to any period of
time, expenses that were paid or required under the Loan Documents to be paid by
the Borrower during such period in connection with the operation or maintenance
of the Collateral (or any portion thereof), or the operation of Borrower's
business at the Trust Property (and, at the Administrative Agent's request,
certified as such by the Borrower pursuant to a Borrower's Certificate),
including: (i) all rent and other amounts payable under any ground lease or
underlying lease (including the Billboard Master Lease, Lutece Master Lease and
the Canyon Ranch Master Lease), (ii) Impositions, (iii) Insurance Premiums (to
the extent payable by Borrower under the REA), (iv) wages, salaries, and fringe
benefits of employees engaged in the operation or management of the Collateral
(or any portion thereof) or the Borrower's business, (v) fees and other amounts
paid in respect of utilities serving the Trust Property, (vi) fees, costs and
expenses for cleaning, janitorial and security services with respect to the
Trust Property (or any portion thereof), (vii) professional fees incurred in
connection with the operation or management of the Trust Property (or any
portion thereof), (viii) repair and maintenance costs with respect to the Trust
Property (or any portion thereof), (ix) advertising, marketing and other
promotional expenses incurred in connection with the Trust Property (or any
portion thereof) or the Borrower's business, (x) travel and entertainment costs
incurred in connection with the Trust Property or the Borrower's business, (xi)
amounts payable under Equipment Leases, (xiii) amounts payable by the Borrower
under the Property Agreements (including Common Charges) and (xiv) amounts
payable by the Borrower to the Interest Rate Cap Agreement counterparty.
"Operating Expenses" shall not include (a) depreciation or amortization or other
noncash items (other than expenses that are or were, as applicable, due but not
yet paid or are described in the parenthetical contained in clause (d) below),
(b) income or franchise taxes payable by the Borrower, (c) Capital Expenditures
(except to the extent includable, under GAAP, in Borrower's operating expenses
for the period of time in question), (d) any amounts that are payable under the
Loan Documents or the Junior Loan Documents and (e) all amounts covered by the
preceding sentence to the extent paid using funds in any of the Bank Accounts
(other than the Cash Management Account) or the Mall Retainage Escrow Account in
accordance with the terms, provisions and conditions hereof.
"Operating Income" means, for any period of time, all Rents
that are actually received by, or for the benefit of, Borrower during such
period.
"Other Borrowings" means, without duplication (but not
including the Indebtedness) (i) all indebtedness of the Borrower for borrowed
money or for the deferred purchase price of property or services, (ii) all
indebtedness of the Borrower evidenced by a note, bond, debenture or similar
instrument, (iii) the face amount of all letters of credit issued for the
account of the Borrower and, without duplication, all unreimbursed amounts drawn
thereunder and obligations evidenced by bankers' acceptances, (iv) all
indebtedness of the Borrower secured by a Lien on any property owned by the
Borrower (whether or not such indebtedness has been assumed), (v) all Contingent
Obligations of the Borrower, (vi) all liabilities and obligations for the
payment of money relating to a capitalized lease obligation or sale/leaseback
obligation, (vii) all liabilities and obligations representing the balance
deferred and unpaid of the purchase price of any property or services, except
those permitted under the express terms of this Agreement and (viii) all payment
obligations of the Borrower under any interest rate protection agreement
(including, without limitation, any interest rate swaps, caps, floors, collars
or similar agreements) and similar agreements (other than the Interest Rate Cap
Agreement).
"Outstanding Principal Indebtedness" means, at any time of
determination, the aggregate principal amount of the Loan that is then
outstanding.
"Participant" has the meaning provided in subsection 10.9(f).
"Participation" has the meaning provided in subsection 5.1(W).
"Payment Date" has the meaning provided in Section 2.5.
"PBGC" means the Pension Benefit Guaranty Corporation
----
established under ERISA, or any successor thereto.
"Permanent Mall Certificate of Occupancy" means a permanent
certificate of occupancy for the Mall issued by the Building Department pursuant
to applicable Legal Requirements which permanent certificate of occupancy shall
(a) permit the Real Property Collateral to be used for the Mall Intended Uses
and (b) be in full force and effect. Capitalized terms that are used in this
definition but not defined in this Agreement have the respective meanings given
in the FADAA.
"Permits" means all licenses, permits, variances and
certificates used in connection with, or otherwise pertaining to, the ownership,
operation, use or occupancy of the Collateral (including, without limitation,
certificates of occupancy, business licenses, state health department licenses,
licenses to conduct business and all such other permits, licenses and rights,
obtained or obtainable from any Governmental Authority or private Person
concerning ownership, operation, use or occupancy of the Collateral).
"Permitted Easements" has the meaning given within the
definition of Permitted Liens.
"Permitted Encumbrances" means, collectively, (i) Permitted
Liens, (ii) rights of existing and future lessees as lessees only pursuant to
Leases executed in accordance with the provisions of the Loan Documents, (iii)
Liens permitted pursuant to subsection 6.1(A), (iv) the Liens created by the
Deed of Trust and the other Loan Documents, and (v) Transfers permitted under
Section 6.1(B).
"Permitted Investments" means any one or more of the
following:
(a) obligations with a remaining maturity of one year or less
that are (i) direct obligations of the United States of America for the full and
timely payment of which its full faith and credit is pledged or (ii) obligations
of a Person controlled or supervised by, and acting as an agency or
instrumentality of, and guaranteed as a full faith and credit obligation which
shall be fully and timely paid by, the United States of America (including a
depository receipt issued by a Lender (as defined in Section 3(a)(2) of the
Securities Act of 1933, as amended) as custodian with respect to such
obligations or a specific payment of principal of or interest on any such
obligation held by such custodian for the account of the holder of such
depository receipt, provided that (except as required by law) such custodian is
not authorized to make any deduction from the amount payable to the holder of
such depository receipt from any amount received by the custodian in respect of
the securities or the specific payment of principal of or interest on the
securities evidenced by such depository receipt);
(b) debt obligations with a remaining maturity of one year or
less, other than obligations referred to in clause (a) above, of any Person,
whether evidenced by bonds, notes, debentures, certificates, book entry,
deposits, certificates of deposit, commercial paper, bankers acceptances,
reinvestment letters, investment contracts, funding agreements or other
instruments, which shall be rated not lower than (i) Aaa by Moody's or if it has
a short-term debt rating then a short-term debt rating not lower than P-1 by
Moody's and (ii) AAA by S&P or if it has a short-term debt rating then the
highest short-term debt rating category by S&P and bonds or other obligations
with a remaining maturity of 91 days or less rated Aaa by Moody's and AAA by
S&P, issued by or by authority of any state of the United States, any territory
or possession of the United States, including the Commonwealth of Puerto Rico
and agencies thereof, or any political subdivision of any of the foregoing; or
any combination of the foregoing;
(c) investments in money market mutual funds held through an
account with an Eligible Institution, which funds invest only in the instruments
specified in (a)(i) and (a)(ii) above; and
(d) deposit accounts maintained at a Bank; provided, however,
that none of (a) and (b) above may mature later than the Business Day preceding
the Maturity Date.
"Permitted Lease" shall have the meaning given in Section
5.1(z) hereof.
"Permitted Liens" means, collectively, (i) all Liens and other
matters disclosed on Schedule B-1 to the Title Insurance Policy, (ii) Liens, if
any, for Impositions imposed by any Governmental Authority not yet delinquent
and with respect to which no penalties are or will be payable or being contested
in good faith and by appropriate proceedings in accordance with the Deed of
Trust, (iii) mechanics' or materialmen's Liens, if any, being contested in good
faith and by appropriate proceedings in accordance with the Deed of Trust or
which, under the terms of Section 6(e) of the Deed of Trust, are not yet
required to be discharged, (iv) easements created under, or in accordance with
the express terms of, the REA or the ESA and, in either case, in accordance with
the terms of this Agreement, (v) other easements ("Permitted Easements") that,
when taken together with all other easements, Liens, encumbrances and other
matters affecting the Trust Property (including, without limitation, the
Permitted Encumbrances) (A) do not (1) interfere (other than to an immaterial
extent) with the use or operation of the Trust Property in accordance with the
terms of this Agreement, (2) adversely affect (other than to an immaterial
extent) the value of the Trust Property and/or (3) impose any material
obligation on the owner of the Trust Property or the Trust Property itself
(other than the granting of the easement in question) and (B) are not reasonably
likely to cause a Material Adverse Effect, (vi) Liens for workers' compensation,
unemployment insurance and similar programs, in each case, arising in the
ordinary course of Borrower's business of operating a First Class Mall in
accordance with the provisions hereof and being contested in good faith and by
appropriate proceedings in accordance with the Deed of Trust and (vii) Equipment
Leases permitted under this Agreement and Equipment Liens permitted under this
Agreement.
"Permitted Mall Expansion" means Mall Phase II but only if the
same is constructed in accordance with the terms, provisions and conditions of
the Loan Documents (including, without limitation, Article VIII hereof).
"Permitted Renovation" means a Renovation that satisfies each
of the following: (i)(A) with respect to any Renovation consisting of work to be
performed by a tenant, or by Borrower for a tenant, under a Permitted Lease to
build-out such tenant's premises for its initial occupancy thereof, such
Renovation as would be made by a Commercially Reasonable Owner, provided that
the making of such Renovation is not likely to cause a Material Adverse Effect,
(B) such Renovation is a Permitted Mall Expansion or (C) with respect to any
Renovation not described in the foregoing clauses (A) or (B), the aggregate cost
of such Renovation and all Renovations related thereto shall be less than
$5,000,000 and (ii) in the case of any Renovation described in the foregoing
clause (i), such Renovation, together with all related Renovations
(collectively, the "Related Renovations") do not (upon completion of any or all
of such Related Renovations), individually, or in the aggregate (w) result in a
material diminution of the value of the Trust Property (the Lenders and the
Agents hereby agreeing that, solely with respect to the Permitted Mall
Expansion, if the Approval Criteria are satisfied, the Lenders and the Agents
shall not assert that there will be a material diminution of the value of the
Trust Property due to the construction of Mall Phase II arising from the fact
that (notwithstanding Mall Sub I and Mall Sub II's compliance with the terms of
the COREA) (1) tenants in Mall Phase II and tenants in Mall Phase I may compete
for the same customers and/or (2) prospective tenants may elect to lease space
in Mall Phase II rather than in Mall Phase I), (x) materially or fundamentally
change the nature, function or use of the Trust Property and/or fundamentally
change the design of the Trust Property, (y) materially adversely affect (1)
access to or from, parking serving and/or the provision of utilities to, the
Trust Property and/or (2) the ability of the owner of the Trust Property to
lawfully use and operate the Trust Property in accordance with the terms of the
Loan Documents and/or (z) permit any tenant to terminate its Lease (unless,
taking into account the benefit to accrue to the Trust Property by reason of
such Renovation, (aa) a Commercially Reasonable Owner would permit such
termination to occur and (bb) such termination is not likely to have a Material
Adverse Effect).
"Permitted Transfer" means any of the following: (i) any
Permitted Encumbrance, (ii) any transfer, directly as a result of the death of a
natural person, of stock, membership interests or other ownership interests
previously held by the decedent in question to the Person or Persons lawfully
entitled thereto, (iii) any transfer, directly as a result of the legal
incapacity of a natural person, of stock, membership interests or other
ownership interests previously held by such natural person to the Person or
Persons lawfully entitled thereto, (iv) with respect to stock, membership
interests or other ownership interests in any Person that is not a natural
person, any transfer or pledge of stock, membership or other ownership interests
in such Person (or of options to purchase such stock, membership or other
ownership interests), provided that, assuming (A) the exercise of all such
options (and after giving effect to the exercise of all such options) and (B)
the foreclosure of all such pledges (and after giving effect to such foreclosure
and the related transfer of the stock, membership or other ownership interests),
the Principal (or, in the case of the death or legal incapacity of the
Principal, the applicable Person or Persons referenced in clause (ii) or (iii),
as applicable) retains control (as defined within the definition of Affiliate)
of the Borrower and the Principal (or, in the case of the death or legal
incapacity of the Principal or in the case of a transfer made pursuant to clause
(v) below, the applicable Person or Persons referenced in clause (ii), (iii) or
(v), as applicable) owns, directly or indirectly, at least 51% of the beneficial
ownership interests of Borrower; provided that no more than 10%, in the
aggregate, of the direct or indirect stock, membership or other ownership
interests of Borrower shall be transferred, pursuant to this clause (iv), to
Persons that are not (aa) bona fide employees of the Borrower (or of an
Affiliate of Borrower) or (bb) family members of the Principal; (v) any transfer
of stock, membership interests or other ownership interests in a Person that is
not a natural person (an "Entity") by a natural person to any Person, provided
that in the case of transfers of stock, membership interests or other ownership
interests held by the Principal, each such transfer must be to a member of his
family (or to a trust the sole beneficiary or beneficiaries of which is a member
of his family) (but only to the extent, in any of the foregoing cases, that (x)
any such transfer is made for estate planning purposes and (y) the Principal
(or, in the case of the death or legal incapacity of the Principal, the
applicable Person or Persons referenced in clause (ii) or (iii), as applicable)
retains control (as defined within the definition of Affiliate) of the Borrower,
(vi) any transfer of Collateral to the successor or surviving Person resulting
from a merger or consolidation of Borrower with any other Person in accordance
with, and subject to, the terms, provisions and conditions of, this Agreement
and (vii) the Takings described on Schedule I attached hereto, provided that,
solely with respect to any of the Takings described on such Schedule I that
shall be "consensual" (A) a Commercially Reasonable Owner would agree to permit
such "consensual" Takings on the terms thereof (including, without limitation,
those relating to the Condemnation Award payable with respect thereto) and (B)
the consummation of such "consensual" Takings will not cause a Material Adverse
Effect; provided further that, notwithstanding the fact that the Takings
described on such Schedule I shall be Permitted Transfers, the provisions of
Section 5.1(X) hereof shall be applicable to such Takings.
"Person" means any individual, corporation, limited liability
company, partnership, joint venture, estate, trust, unincorporated association,
any federal, state, county or municipal government or any bureau, department or
agency thereof and any fiduciary acting in such capacity on behalf of any of the
foregoing.
"Plan" means an employee benefit or other plan established or
maintained by the Borrower or any ERISA Affiliate during the five-year period
ended prior to the date of this Agreement or to which the Borrower or any ERISA
Affiliate makes, is obligated to make, or has, within the five-year period ended
prior to the date of this Agreement, been required to make contributions that is
covered by Title IV of ERISA (other than a Multiemployer Plan).
"Policies" and "Policy" have the meanings provided in Section
5.1(X)(ii).
"Prepayment Date" shall have the meaning given in subsection
2.6(b).
"Prime Rate" means the rate that Scotiabank announces from its
New York office from time to time as its United States dollar prime lending rate
as in effect from time to time. The Prime Rate is a reference rate and does not
necessarily represent the lowest or best rate actually charged to any customer.
Scotiabank or any other Lender may make commercial loans or other loans at rates
of interest at, above or below the Prime Rate.
"Principal" means Sheldon G. Adelson.
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"Principal Non-Recourse Carve-Out and Limited Environmental
Matters Guaranty" means that certain Indemnity and Guaranty Agreement in the
form attached hereto as Exhibit E attached hereto, dated as of the date hereof
made by the Principal in favor of the Agents for the benefit of the Lenders and
in favor of the Lenders, as the same may be amended, supplemented or otherwise
modified from time to time.
"Proceeds" means all proceeds, both cash and noncash, of the
Collateral (or any portion thereof).
"Projected Rent" shall mean, for any period of time, with
respect to (A) any COREA Qualified Lease or any COREA Qualified Lease Commitment
that provides for the use of the leased premises in question as a restaurant
(but excluding any such leased premises that are located within a "food court"),
the greater, of (1) the aggregate minimum (i.e. exclusive of percentage or
additional) rent that is required to be paid by the tenant thereunder with
respect to such period (other than minimum rent payable with respect to any
portion of such leased premises that is not located within the Mall) or (2) the
sum of (a)(i) the product of $50 (or, with respect to any net rentable square
foot of the leased premises that is or will be located on the first level of the
Mall over which there will not be constructed, prior to the time that the
Borrower delivers such leased premises to such tenant, a second level of Mall,
$75) pro rated for the period in question based upon the ratio that the number
of calendar months (or portions thereof) in such period bears to twelve (12)
multiplied by (ii) the aggregate net rentable square footage of the leased
premises that is or will be located on the first level of the Mall plus (b) the
product of (i) $25 (pro rated as aforesaid) multiplied by (ii) the aggregate net
rentable square footage of the leased premises that is or will be located on the
second level of the Mall, (B) the Billboard Operating Lease, $945,000 pro rated
as aforesaid, (C) the Madame Tussaud LOI/Lease, $960,000 pro rated as aforesaid,
and (D) with respect to any other COREA Qualified Lease or COREA Qualified Lease
Commitment, minimum (i.e. exclusive of percentage or additional) rent that is
required to be paid by the tenant thereunder with respect to such period minus,
in the case of the Canyon Ranch Operating Lease, all rent reasonably projected
by Administrative Agent to be payable under the Canyon Ranch Master Lease for
the period in question.
"Project Impositions" means all Taxes (as defined the REA)
relating to the Real Property with respect to which REA Owners are required,
under the REA, to make deposits into the REA Tax Escrow Account.
"Property Agreements" means all agreements, grants of
easements and/or rights-of-way, reciprocal easement agreements, Permits,
declarations of covenants, conditions and restrictions, disposition and
development agreements, construction management agreements, architectural
agreements, construction agreements, planned unit development agreements,
parking agreements, party wall agreements and all other instruments, agreements
and documents relating to the acquisition, construction, ownership, use,
operation or maintenance of the Collateral, including, without limitation, the
documents and instruments that constitute Permitted Encumbrances, the REA, the
ESA, the FADAA, the Mall Retainage Escrow Agreement, the Sale and Contribution
Agreement, the Trademark Cross License Agreement, the COREA (if entered into)
and all management agreements and service contracts but excluding the Leases and
the Loan Documents.
"Property Insurance" has the meaning provided in subsection
5.1(X)(x).
"Proposed Plans and Specifications Notice" means, with respect
to any proposed Renovation (other than a Permitted Renovation) that the
Administrative Agent shall approve (or shall be deemed, in accordance with the
provisions of this Agreement, to have approved), a notice from the Borrower to
the Administrative Agent attached to which shall be the description of such
proposed Renovation that was contained in the relevant Proposed Renovation
Notice, as well as the plans and specifications relating to such proposed
Renovation and a statement as to which tenants, if any, would be permitted to
terminate their Leases if such proposed Renovation were made (without giving
effect to any relocation right afforded Borrower under the Leases). Each
Proposed Plans and Specifications Notice shall be legended (in bold, capitalized
letters) with the following:
"This is a Proposed Plans and Specifications Notice referred
to in that certain Loan Agreement dated as of December 20, 1999 among the
Lenders from time to time parties thereto, Goldman Sachs Mortgage Company, as
Syndication Agent, The Bank of Nova Scotia, as Collateral Agent, The Bank of
Nova Scotia, as Administrative Agent and Grand Canal Shops Mall Subsidiary, LLC,
as borrower (the "Loan Agreement") with respect to the proposed Renovation
described in that certain Proposed Renovation Notice dated _____ furnished to
you in accordance with the terms of the Loan Agreement. If you do not approve or
disapprove, in writing, the proposed plans and specifications attached hereto
within twenty (20) Business Days after the date upon which you have actually
received this Proposed Plans and Specifications Notice and the plans and
specifications relating to the aforesaid proposed Renovation (without giving
effect to the "deemed receipt" provisions of subsection 10.6 of the Loan
Agreement), then you shall be deemed to have approved such plans and
specifications."
"Proposed Renovation Materials" means, with respect to any
Proposed Renovation Notice, the materials and data upon which Borrower based its
estimate, set forth in such Proposed Renovation Notice, of the cost of the
proposed Renovation in question, as well as such other information or materials
with respect to such proposed Renovation as the Administrative Agent shall
reasonably request.
"Proposed Renovation Notice" means, with respect to any
Renovation (other than a Permitted Renovation) that Borrower desires to make, a
notice from the Borrower to the Administrative Agent containing a reasonably
detailed description of such proposed Renovation and Borrower's reasonable
estimate of the aggregate cost thereof. Each Proposed Renovation Notice shall be
legended (in bold, capitalized letters) with the following:
"This is a Proposed Renovation Notice referred to in that
certain Loan Agreement dated as of December 20, 1999 among the Lenders from time
to time parties thereto, Goldman Sachs Mortgage Company, as Syndication Agent,
The Bank of Nova Scotia, as Collateral Agent, The Bank of Nova Scotia, as
Administrative Agent and Grand Canal Shops Mall Subsidiary, LLC, as borrower
(the "Loan Agreement"). If you do not approve or disapprove, in writing, the
proposed Renovation described herein within twenty (20) Business Days after the
date upon which you have actually received this Proposed Renovation Notice and
all Proposed Renovation Materials (without giving effect to the "deemed receipt"
provisions of subsection 10.6 of the Loan Agreement), then you shall be deemed
to have approved such proposed Renovation."
"Qualified Bank" means any commercial bank having a combined
--------------
capital and surplus of at least $500,000,000.
"Qualified Insurer" has the meaning set forth in Section
5.1(X)(ii).
"REA" means that certain Amended and Restated Reciprocal
Easement, Use and Operating Agreement dated as of November 14, 1997 among
Interface Group - Nevada, Inc., Mall Construction (as predecessor-in-interest to
Grand Canal, as predecessor-in-interest to Borrower) and Venetian, as amended
pursuant to that certain First Amendment to Amended and Restated Reciprocal
Easement, Use and Operating Agreement dated as of the date hereof, as the same
may be amended, supplemented or otherwise modified in accordance with the terms
hereof.
"REA Insurance Premium Escrow Account" means the Insurance
Escrow Account (as such term is defined in the REA).
"REA Lender" means any Mortgagee (as such term is defined in
the REA) that is not an Affiliate of an REA Owner.
"REA Owner" means any Owner (as such term is defined in the
REA).
"REA Tax Escrow Account" means the Tax Escrow Account (as such
term is defined in the REA).
"Real Property" has the meaning provided in the Deed of Trust.
"Recorder's Office" means the office of the county recorder of
Clark County, Nevada.
"Regulatory Change" means any change after the date of this
Agreement (or with respect to any Assignee hereunder, after the date such
Assignee becomes a Lender) in federal, state or foreign laws or regulations or
the adoption or the making, after such date, of any interpretations, directives
or requests applying to a class of banks, companies controlling banks or
lenders, including a Lender or any company controlling a Lender, of or under any
federal, state or foreign laws or regulations (whether or not having the force
of law) by any court or governmental or monetary authority charged with the
interpretation or administration thereof.
"Release" means any release, spill, emission, leaking,
pumping, injection, deposit, disposal, discharge, dispersal, leaching or
migration into the indoor or outdoor environment (including, without limitation,
the movement of Hazardous Substances through ambient air, soil, surface water,
ground water, wetlands, land or subsurface strata).
"Remedial Work" has the meaning provided in subsection 5.1(D).
"Renovation" means the demolition, removal, replacement,
construction, rebuilding, change or alteration of or to the Trust Property (or
any portion thereof).
"Rents" means such term as it is defined in the Deed of Trust.
"Replacement Equipment" has the meaning provided in subsection
6.1(U).
"Required COREA Lease" a Lease is a "Required COREA Lease" if
such Lease (or a COREA Qualified Lease Commitment relating thereto) was, prior
to the time in question, included in the calculation of COREA Rent in connection
with any determination as to whether the Approval Criteria were satisfied.
"Required Lenders" means at any time Lenders holding at least
66-2/3% of the aggregate then Outstanding Principal Indebtedness.
"Required Reserves" has the meaning given in the definition of
"Excess Cash Flow".
"Reserve Percentage" means, for any day, the stated maximum
rate (expressed as a decimal) in effect on such day at which reserves (including
any marginal, supplemental or emergency reserves) are required to be maintained
under Regulation D by a member bank of the Federal Reserve System against
"Eurocurrency liabilities" (as such term is used in Regulation D) but without
benefit of or credit for proration, exemptions or offsets that might otherwise
be available to such member bank from time to time under Regulation D as
reported by the affected Lender or Lenders. Without limiting the effect of the
foregoing, the Reserve Percentage shall reflect any other reserves required to
be maintained by such member bank against (i) any category of liabilities which
includes deposits by reference to which Adjusted LIBOR for the Loan is to be
determined or (ii) any category of extension of credit or other assets that
includes the Loan, but not including any risk-based or other capital
requirements relating to extensions of credit. The Reserve Percentage shall be
expressed in decimal form and rounded upward, if necessary, to the nearest
1/100th of one percent, and shall include marginal, emergency, supplemental,
special and other reserve percentages. The parties hereto acknowledge that, as
of the Closing Date, the Reserve Percentage is 0.
"Restoration" has the meaning provided in Section 5.1(X)(x).
"Retail Annex" has the meaning provided in the Deed of Trust.
"Retail Annex Land" has the meaning provided in the Deed of
Trust.
"Sale and Contribution Agreement" means that certain Second
Sale and Contribution Agreement dated as of the date hereof between Grand Canal,
as seller, and Borrower, as purchaser, as the same may be amended, supplemented
or otherwise modified in accordance with the terms hereof.
"Scope Change Guaranty" means that certain Mall Scope Change
Guaranty in the form attached hereto as Exhibit L, dated as of the Closing Date
and executed by the Principal, as the same may from time to time be amended,
supplemented, extended or otherwise modified.
"Scotiabank" means the Bank of Nova Scotia.
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"Securities Act" has the meaning provided in subsection
6.1(S).
"Service Contracts" means service contracts executed in the
ordinary course of operation of the Trust Property that would not be binding on
the Trust Property (or any portion thereof) or the Collateral Agent if the
Collateral Agent were to become the owner of the Trust Property for the benefit
of the Lenders or that are terminable by the Borrower (or its successor or
assign), without the payment of a termination fee or any other similar amount,
upon not more than thirty (30) days notice.
"Single-Purpose Entity" means a Person, other than an
individual, which (i) is formed or organized solely for, and the nature of
business and objects proposed to be transacted and carried on by it are, the
limited purposes described on Schedule D-1 attached hereto (with respect to
Borrower) or Schedule D-2 attached hereto (with respect to Managing Member) and,
in any case, none other (the "Permitted Activities"), (ii) does not engage in
any business other than the Permitted Activities, (iii) does not have any assets
other than those related to its interest in the Collateral (in the case of
Borrower) or a 1% managing member membership interest in Borrower (in the case
of Managing Member) or, in any case, any indebtedness other than as permitted by
this Agreement, the Deed of Trust or the other Loan Documents, (iv) has its own
separate books and records and has its own accounts, in each case which are
separate and apart from the books and records and accounts of any other Person,
(v) is subject to all of the limitations on powers set forth in the
organizational documentation of the Borrower or Managing Member, as applicable,
as of the Closing Date, (vi) holds itself out as being a Person separate and
apart from any other Person and (vii) has, in the case of Managing Member, at
least one Independent Director.
"S&P" means Standard & Poor's Ratings Group, a division of
McGraw-Hill, Inc.
"second level" means, (A) with respect to the Mall, the
mezzanine level of the Mall and (B) with respect to the Retail Annex, the second
level of the Retail Annex.
"SNDA" means a subordination non-disturbance and attornment
agreement substantially in the form of Exhibit M hereto.
"SNDA Deposit Escrow Account" has the meaning provided in
Section 2.12(d)(iv).
"SNDA Qualified Lease" means, as of any date of determination,
a Lease (i)(a) that substantially conforms to the applicable (e.g., retail or
restaurant) standard lease form attached hereto as Exhibit I-1 or Exhibit I-2,
as applicable (with such changes thereto as both (x) a Commercially Reasonable
Owner would agree to and (y) are not likely to result in a Material Adverse
Effect), provided that in no event shall such changes include a right of the
tenant to terminate the Lease (except for rights to terminate, due to a Casualty
or Taking, that both a Commercially Reasonable Owner would agree to and that are
not likely to result in a Material Adverse Effect)), (b) with respect to which,
in the case of a Lease that was theretofore entered into, such Lease is in full
force and effect and there is no monetary default or material non-monetary
default and (c) that complies with the provisions of Schedule H-1 attached
hereto (as such provisions may be changed from time to time with the prior
consent of the Administrative Agent (which consent shall not be unreasonably
withheld or delayed) (any such Lease, and any Lease described on Schedule H-2
hereto, shall each be referred to as an "Automatically Qualified SNDA Lease") or
(ii) is otherwise approved by the Administrative Agent (which approval shall not
be unreasonably withheld or delayed); provided that, notwithstanding the
foregoing, each Lease described on Schedule H-2 hereto shall be deemed to be a
"SNDA Qualified Lease" so long as, at the time in question, such Lease is in
full force and effect and there is no monetary default or material non-monetary
default under such Lease.
"Start-Up Cost Escrow Accounts" means the collective reference
to the "Operating Expense Account", the "Brokerage Commission Account" and the
"TI Costs Account".
"Subsection 4.1(J) Representation and Warranty" has the
meaning provided in subsection 4.1(J).
"Subordinate Lease" means a Lease that (A) shall, by its
terms, be expressly subordinate in all respect to the Deed of Trust and the
other Loan Documents (without any non-disturbance or similar protection being
afforded the tenant or other occupant thereunder) and (B) will terminate as a
matter of law, or may be terminated by the Collateral Agent as a result of, or
in connection with, foreclosure of the Deed of Trust.
"Syndication Agent" means Goldman Sachs Mortgage Company, in
its capacity as syndication agent for the Lenders hereunder, and its successors
in such capacity.
"Taking" means a taking or other conveyance during the term
hereof of all or part of the Real Property, or any interest therein or right
accruing thereto or use thereof, as the result of, or in settlement of, any
condemnation or other eminent domain proceeding by any Governmental Authority
affecting the Real Property or any portion thereof whether or not the same shall
have actually been commenced.
"Tax Distributions" means tax distributions to members of
Borrower to the extent necessary to cover income taxes (x) on such members'
distributive share of limited liability company income and gains (which
distributive share must be included in such members' taxable income
notwithstanding the fact that the partnership made no actual distribution as a
result of the provisions of this Section 3) or (y) on accrued and unpaid
interest in respect of the Subordinate Loan, in each case, assuming that the
applicable marginal income tax rate is the Applicable Tax Percentage (such tax
distributions described in clause (y), "Interest Tax Distributions").
"Taxes" has the meaning provided in subsection 2.10(a).
"Tax Escrow Account" has the meaning provided in subsection
2.12(b).
"Tenant Claims" shall mean claims made by tenants in
connection with, or as a result of, the construction and/or opening of the Mall
Improvements.
"TI Costs" means the costs of tenant space build-out work and
other tenant concessions and inducements payable by Borrower under, or in
connection with, Leases.
"TI Costs Deposit" shall mean $1,165,393.19.
"TI Costs Revenue Achievement Date" shall mean the first date
occurring on or after the Closing Date upon which the Approval Criteria shall be
satisfied (provided that for purposes of this definition of "TI Deposit Revenue
Achievement Date", "$28,000,000" shall be substituted for "$21,000,000" each
time it appears in the definition of "Approval Criteria").
"TI Costs Account" has the meaning provided in Section
2.12(d)(ii).
"Title Insurance Policy" means the mortgagee's title insurance
policy insuring the Deed of Trust issued by one or more title companies to, and
accepted by, the Collateral Agent at, and in connection with, the Closing.
"Trademark" means the trademark licenses, trademarks, rights
in intellectual property, trade names, service marks and copyrights relating to
the Trust Property or the license to use intellectual property such as computer
software owned or licensed by the Borrower or other proprietary business
information relating to the Borrower's policies, procedures, manuals and trade
secrets.
"Trademark Cross License Agreement" means that certain
Trademark Cross License Agreement dated November 14, 1997 by and between LVSI,
Venetian and Mall Construction (as predecessor-in-interest to Grand Canal as
predecessor-in-interest to Borrower), as amended, supplemented or otherwise
modified in accordance with the terms hereof.
"Transaction" means the transactions contemplated by the Loan
Documents.
"Transaction Costs" means all costs and expenses paid or
payable by the Borrower relating to the Transaction (including, without
limitation, appraisal fees, legal fees, and accounting fees and costs and
expenses associated therewith); provided that "Transaction Costs" shall not,
except to the extent provided in Section 10.23 hereof (or otherwise expressly
provided in any Loan Document), include legal fees and other expenses of the
Lenders (other than GSMC), any cost or expense of syndicating the Loan or any
legal fees or other expenses of any Agent (other than the Syndication Agent)
incurred on or prior to the Closing Date.
"Transfer" means the conveyance, transfer, assignment, sale,
mortgaging, encumbrance, pledging, hypothecation, granting of a Lien in or on,
granting of options with respect to, or other disposition of (directly or
indirectly, voluntarily or involuntarily, by operation of law or otherwise, and
whether or not for consideration or of record) all or any portion of any legal
or beneficial interest (a) in all or any portion of the Collateral; (b) in the
membership or other ownership interests in, the Borrower; (c) in the Borrower
(or any trust of which the Borrower is a trustee); or (d) in any Person having a
direct or indirect legal or beneficial ownership in the Borrower and shall also
include, without limitation to the foregoing, the following: an installment
sales agreement wherein the Borrower agrees to sell the Collateral or any part
thereof or any interest therein for a price to be paid in installments; an
agreement by the Borrower leasing all or a substantial part of the Collateral to
one or more Persons pursuant to a single or related transactions, or a sale,
assignment or other transfer or, or the grant of a security interest in, the
Borrower's right, title and interest in and to any Leases or any Rent; any
instrument subjecting the Collateral to a condominium regime or transferring
ownership to a cooperative corporation; and the dissolution or termination of
the Borrower or the merger or consolidation of the Borrower with any other
Person.
"Transfer Notice" has the meaning provided in subsection
6.1(B)(ii).
"Trustee" has the meaning given in the REA.
"Trust Property" has the meaning given in the Deed of Trust.
"UCC" means with respect to the Trust Property, the Uniform
Commercial Code as in effect on the date hereof in the state where the Trust
Property is located, as amended from time to time; provided, that if by reason
of mandatory provisions of law, the perfection or the effect of perfection or
non-perfection of the security interest in any item or portion of the Collateral
is governed by the Uniform Commercial Code as in effect in a jurisdiction other
than the state where the Trust Property is located, "UCC" shall mean the Uniform
Commercial Code as in effect in such other jurisdiction for purposes of the
provisions hereof relating to such perfection or effect of perfection or
non-perfection.
"UCC Searches" has the meaning specified in subsection 3.1(T).
"Unfunded Benefit Liabilities" means, with respect to any
Plan, the amount (if any) by which the present value of all benefit liabilities
(within the meaning of Section 4001(a)(16) of ERISA) under the Plan exceeds the
fair market value of all Plan assets allocable to such benefit liabilities, as
determined on the most recent valuation date of the Plan and in accordance with
the provisions of ERISA for calculating the potential liability of the Borrower
or any ERISA Affiliate under Title IV of ERISA.
"Use" means, with respect to any Hazardous Substance, the
generation, manufacture, processing, distribution, handling, use, treatment,
recycling, burying, retention, refining, production, disposition or storage of
such Hazardous Substance or transportation of such Hazardous Substance.
"Venetian" means Venetian Casino Resort, LLC, a Nevada limited
liability company.
"Welfare Plan" means an employee welfare benefit plan (as
defined in Section 3(1) of ERISA) established or maintained by the Borrower or
any Subsidiary or that covers any current or former employee of the Borrower or
any Subsidiary (other than a Multiemployer Plan).
ARTICLE II.
GENERAL TERMS
Section 2.1. The Loan. (a) The Loan shall consist of one
advance of the Loan (the "Loan Advance"), in a principal amount equal to the
Loan Amount, to be made to the Borrower on the Closing Date and there shall be
no advances of the Loan made after the Closing Date. Each Lender shall, on the
Closing Date, fund its Lender's Commitment Percentage of the Loan Amount. The
borrowing of the Loan Advance under this Section shall be made from the several
Lenders ratably in proportion to their respective Loan Commitment Percentages.
Failure of any Lender to make any Loan Advance required to be made by such
Lender hereunder shall not relieve such Lender, or any other Lender, of any of
its obligations hereunder. No Lender shall have any responsibility for any
failure by any other Lender to fulfill its obligations hereunder.
(a)(b) Not later than 11:00 a.m., New York City time, on the
Closing Date, each Lender shall make available its share of the requested Loan
Advance (determined as aforesaid), in Funds, by deposit to the Administrative
Agent's account specified in Section 10.6 or otherwise specified in writing by
the Administrative Agent to the Lenders (at least two (2) Business Days prior to
the Closing Date). Unless the Syndication Agent shall determine that any
applicable condition to the making of the requested Loan Advance has not been
satisfied and shall notify the Administrative Agent prior to the Closing Date of
the same (in which case, the Syndication Agent shall also instruct the
Administrative Agent to refund to each Lender such Lender's share of such Loan
Advance (to the extent actually funded to the Administrative Agent by such
Lender) and the Administrative Agent shall so refund the same), the
Administrative Agent will wire transfer the amount of the requested Loan Advance
to the account described in the Borrower's wiring instructions on the Closing
Date. The proceeds of the Loan shall be used solely for the purposes identified
in Section 2.2 hereof.
(c) [Intentionally omitted]
(d) The Loan shall constitute the general obligation of the
Borrower to the Lenders and shall be secured by the security interest in and
Liens granted upon all of the Collateral and by all other security interests and
Liens at any time or times hereafter granted by the Borrower to the Collateral
Agent.
Section 2.2. Use of Proceeds. Proceeds of the Loan shall
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be used solely to finance a portion of the purchase price of the Trust Property
in accordance with the provisions of the Sale and Contribution Agreement.
Section 2.3. Security for the Loans. (a) The Notes and the
Borrower's obligations hereunder and under the other Loan Documents shall be
secured by the Deed of Trust and the other Collateral Security Instruments.
Section 2.4. The Notes. (a) The portion of the Loan Advance
made by each Lender shall be evidenced by a single Note (or, at the request of a
Lender, two or three Notes) payable to the order of such Lender for the account
of its Lending Office in a principal amount (in the case of a Lender holding two
or three Notes, in an aggregate principal amount) equal to such portion of the
Loan Advance. The Borrower's obligation to pay the principal of and interest on
the portion of the Loan made by each Lender shall be evidenced by the Note (or
Notes) that is payable to the order of such Lender. Each Note shall provide for
a final maturity on the Maturity Date.
(a)(b) Each Lender is hereby authorized to endorse on the
schedule attached to its Note(s) (or on a continuation of such schedule attached
to such Note(s) and made a part thereof) an appropriate notation evidencing each
payment of interest or other amounts due under the Loan Documents, in respect
thereof and may, if such Lender so elects in connection with any transfer or
enforcement of its Note(s), endorse on the schedule forming a part thereof
appropriate notations to evidence the foregoing information. Such schedule
shall, absent manifest error, constitute prima facie evidence of the accuracy of
the information contained therein. The failure of any Lender to make a notation
on the schedule to its Note(s) as aforesaid shall not affect the obligations of
the Borrower hereunder or under such Note(s) or any other Loan Document in any
respect.
Section 2.5. Principal and Interest. (a) Borrower shall pay to
the Administrative Agent for the benefit of the Lenders interest on the Loan
from the Closing Date to but excluding the date upon which the Loan shall be
repaid in full as described in this Section 2.5. The Loan shall bear interest
for each Interest Accrual Period with respect thereto at a rate per annum equal
to the sum of the Adjusted LIBOR determined as of the relevant Interest
Determination Date immediately preceding such Interest Accrual Period plus the
Applicable Margin (the "Interest Rate"). Interest on the Loan shall accrue on
the outstanding principal amount thereof commencing on the Closing Date.
Interest with respect to the period commencing on the Closing Date and ending on
(and including) the last day of the calendar month in which the Closing occurs
(such period, the "Initial Interest Period") shall be payable on the date hereof
and, commencing with the second calendar month next following the calendar month
in which the Closing Date occurs, interest shall be payable in arrears on the
earlier of (i) the first (1st) day of each and every calendar month through the
calendar month in which the Maturity Date occurs or (ii) the last day of the
applicable Index Maturity, unless, in any such case, such day is not a Business
Day, in which event such interest shall be payable on the first Business Day
following such date (such date for any particular month, the "Payment Date").
The entire Outstanding Principal Indebtedness of the Loan, together with all
accrued but unpaid interest thereon shall be due and payable by the Borrower, on
the Maturity Date, to the Administrative Agent for the benefit of the Lenders
and Borrower shall pay, on the Maturity Date, all other amounts due under the
Loan Documents on the Maturity Date to the parties entitled thereto under the
Loan Documents. Interest shall be computed on the basis of a 360-day year and
the actual number of days elapsed.
(a)(b) At such time as an Event of Default shall exist, the
Borrower shall pay to the Administrative Agent for the benefit of the Lenders
interest at the Default Rate on the Outstanding Principal Indebtedness, and on
due but unpaid interest thereon (but not on interest payable pursuant to this
subsection 2.5(b)), and shall pay to the applicable Lender or the applicable
Agent, as applicable, interest at the Default Rate on any other amount owing to
such Lender or such Agent, as applicable, not paid when due, in each case, from
the date that such amount first becomes due until such amount is paid in full.
(c) The Administrative Agent shall determine each interest
rate applicable to the Loan hereunder, and its determination thereof shall be
conclusive in the absence of manifest error. On each Interest Determination Date
(and otherwise upon request therefor by the Borrower or any Lender), the
Administrative Agent shall give oral notice to the Borrower and to each Lender
(or, upon any such request, to the Borrower or to such Lender, as applicable) of
the then applicable interest rate.
Section 2.6. Prepayment. (a) So long as no Event of Default
shall exist, subject to the other terms, provisions and conditions of this
Section, the Borrower may prepay the Loan in whole on any Business Day, without
any prepayment fee or premium; provided, however, that, any such prepayment
shall be accompanied by (i) all accrued interest on the Loan, and (ii) all
Breakage Costs and any other amounts then due under the Loan Documents.
(a)(b) In the event of any prepayment described in Section
2.6(a) above, the Borrower shall give the Administrative Agent written notice
(or telephonic notice promptly confirmed in writing) of its intent to prepay,
which notice shall be given at least ten (10) Business Days, but not more than
twenty (20) Business Days, prior to the date upon which prepayment is to be made
and shall specify the Business Day on which such prepayment is to be made (such
date, the "Prepayment Date"). If any such notice is given, all amounts described
in subsection 2.6(a) shall be due and payable on the Prepayment Date specified
therein (and such prepayment notice shall be irrevocable).
(c) Borrower shall not be entitled to prepay a portion of
the Loan.
(d) Loan Advances that are repaid, whether pursuant to
the provisions of this Section 2.6, or otherwise, may not be reborrowed.
-----------
Section 2.7. Application of Payments After an Event of
Default. All proceeds relating to any repayments of the Loan occurring while an
Event of Default shall exist shall be applied to pay: first, any reasonable
out-of-pocket costs and expenses of the Agents and the Lenders arising as a
result of such repayment or Event of Default or enforcement of the Loan in
connection therewith, and any other portion or portions of the Indebtedness
other than principal and interest; second, any accrued and unpaid interest then
payable with respect to the Loan or the portion thereof being repaid; and third,
the outstanding principal amount of the Loan.
Section 2.8. Method and Place of Payment. (a) Except as
otherwise specifically provided herein, all payments and prepayments under this
Agreement and the Notes shall be made to the Administrative Agent by 11:00 a.m.
New York City time, on the date such payment or prepayment, as applicable, is
due in lawful money of the United States of America by wire transfer in federal
or other Funds, by deposit to an account specified in writing by Administrative
Agent to Borrower (as the same may be changed in writing by the Administrative
Agent at least two (2) Business Days prior to the due date). Any funds received
by the Administrative Agent after such time shall, for all purposes hereof, be
deemed to have been paid on the next succeeding Business Day. All payments made
by the Borrower hereunder, or by the Borrower under the other Loan Documents,
shall be made irrespective of, and without any deduction for, any set-offs or
counterclaims. The Administrative Agent will on the day such funds are received
distribute to each Lender its ratable share of each such payment received
hereunder by the Administrative Agent for the account of the Lenders to the
account of such Lender designated below its signature below (or to such other
account as such Lender may instruct the Administrative Agent in writing at least
two (2) Business Days prior to the applicable Borrowing Date), provided,
however, that if such payment is received after 11:00 a.m., New York City time,
the Administrative Agent shall make such distributions on the next Business Day.
(a)(b) Unless the Administrative Agent shall have received
notice from the Borrower prior to the date on which any payment is due to the
Lenders hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may (but
shall not be required to), in reliance upon such assumption, cause to be
distributed to each Lender on such due date an amount equal to the amount then
due such Lender. If and to the extent that the Borrower shall not have so made
such payment, each Lender shall repay to the Administrative Agent forthwith on
demand such amount distributed to such Lender together with interest thereon,
for each day from the date such amount is distributed to such Lender until the
date such Lender repays such amount to the Administrative Agent, at the Federal
Funds Rate as in effect for such day. Nothing contained in this subparagraph
(b), and no action taken in connection with this subparagraph (b), shall (i)
relieve, or shall be deemed to relieve, the Borrower from its obligation to make
any payment hereunder or (ii) constitute, or be deemed to constitute, a waiver
of any Default or Event of Default.
Section 2.9. Collateral for Certain Tenant Claims;
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Deposits Into and Withdrawals from SNDA Deposit Escrow Account; Delivery of
- ----------------------------------------------------------------------------
SNDAs.
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(a) Borrower hereby represents and warrants that all Tenant
Claims of which, as of the date hereof, Borrower or any of its Affiliates has
knowledge or received notice is set forth on Schedule C-1 hereto (collectively,
"Existing Tenant Claims") and that such Schedule C-1 accurately describes each
such Tenant Claim (including, without limitation, the estimated amount of each
such Tenant Claim). To the extent that the amount of any Existing Tenant Claim,
as set forth on such Schedule C-1, shall be blank (an "Unquantified Existing
Tenant Claim") Borrower, on or prior to December 27, 1999, will provide a
certificate to Administrative Agent, in form reasonably satisfactory to
Administrative Agent, certifying as to the amounts of such Existing Tenant
Claims, which amounts shall be subject to Administrative Agent's confirmation
(in its reasonable discretion) ("Updated Existing Tenant Claims Amounts").
Immediately after Borrower or any Affiliate thereof receives notice or otherwise
obtains knowledge of any Tenant Claim (other than Existing Tenant Claims),
Borrower shall furnish to Administrative Agent a description of such Tenant
Claim, in reasonable detail (including, without limitation, the estimated amount
of each such Tenant Claim) together with all tenant notices and other relevant
materials relating to such Tenant Claim. Schedule C-2 hereto sets forth a list
of Leases ("SNDA Required Leases") with respect to which Collateral Agent is
entitled, under the Loan Commitment Letter, to receive, but has not yet
received, an SNDA and/or an estoppel certificate reasonably acceptable to the
Lenders as a condition to the Lenders' obligation to fund the Loan (the
"SNDA/Estoppel Condition"). In order to induce the Lenders to make the Loan
notwithstanding the non-satisfaction of the SNDA/Estoppel Condition, and for
other good and valuable consideration, Borrower, and the Junior Lender (which is
an Affiliate of the Borrower and will benefit directly and indirectly from the
making of the Loan by the Lenders) have agreed to the terms and provisions of
this Section 2.9.
(b)(i) On the Closing Date, Junior Lender shall deposit with
Willkie Farr & Gallagher, as escrow agent (in such capacity, "Escrow Agent") the
Junior Note (duly endorsed to the Collateral Agent) and the Junior Deed of Trust
to be held in accordance with the provision of the Escrow Agreement (as defined
below); provided that prior to execution of the Escrow Agreement (as defined
below), the terms, conditions and provisions of Exhibit N hereto shall be
applicable to Escrow Agent's obligations with respect to the escrow being
created hereby. Each of Borrower and Junior Lender hereby represents and
warrants that the Junior Note and the Junior Deed of Trust are the only Junior
Loan Documents that exist as of the date hereof.
(ii) On February 25, 2000 and thereafter on the twenty-fifth
(25th) day of each calendar month thereafter occurring, all Excess Cash Flow for
the immediately preceding Interest Accrual Period shall be paid directly by
Borrower to Collateral Agent to be held in the SNDA Deposit Escrow Account as
security for the Indebtedness until the amount of funds then on deposit in the
SNDA Deposit Escrow Account is equal to the aggregate amount of the Tenant
Claims that are then outstanding (as determined by Administrative Agent, in its
reasonable discretion), at which point Excess Cash Flow shall be payable to
Borrower until such time(s), if any, as the aggregate amount of Tenant Claims
shall exceed the amount of funds then on deposit in the SNDA Deposit Escrow
Account, at which time Excess Cash Flow shall again be payable to Collateral
Agent as aforesaid.
(iii) The parties agree that (A) the amount of an "Existing
Tenant Claim" for any given tenant shall be the amount set forth under the
heading "Total Claim" on Schedule C-1 hereto (or in the case of any Unquantified
Existing Tenant Claim, the applicable Updated Existing Tenant Claims Amount),
(B) the amount of any "Tenant Claim" that is not an Existing Tenant Claim shall
be the aggregate amount of the Tenant Claims of such tenant (as certified to by
Borrower as aforesaid and confirmed by Administrative Agent in its reasonable
discretion)(an "Additional Tenant Claim"), (C) the amount of any Tenant Claim,
as contained in an estoppel certificate or other writing reasonably acceptable
to Administration Agent executed and delivered by the applicable tenant, shall
supersede the amount determined pursuant to the foregoing clause "(A)" or "(B)",
as applicable, above, (D) if the amount of any claim that would, in the absence
of this clause "(D)", be an Additional Tenant Claim shall be less than $50,000,
then it shall not be deemed to be a Tenant Claim for any purpose hereof and (E)
Administrative Agent, in its sole discretion, may determine whether a particular
Tenant Claim should be reduced by the amount of any claims that Borrower has
against the applicable tenant in respect of delinquent Rent under the applicable
Lease. Furthermore, Borrower, at its election, exercisable at any time upon at
least five (5) Business Days' notice to Administrative Agent, may elect to
substitute a Letter of Credit in lieu of its obligation to fund Excess Cash Flow
into the SNDA Deposit Escrow Account or to maintain funds on deposit in the SNDA
Deposit Escrow Account. The Letter of Credit shall (x) be in an amount that is
equal to the aggregate amount of all Tenant Claims then outstanding (i.e., the
Letter of Credit must be continually replaced so that the amount thereof equals
or, at Borrower's election, exceeds the then aggregate amount of Tenant Claims
as determined at any given time by Administrative Agent, in its reasonable
discretion)), (y) have a term of six (6) months (which Letter of Credit must, at
all times prior to the Tenant Claims Satisfaction Date, be replaced, at least
thirty (30) days prior to each expiration date thereof, with a Letter of Credit
providing for an expiration date that occurs six (6) months from the expiration
date of the Letter of Credit being replaced), together with an Account Party
Sideletter executed and delivered by the account party under the Letter of
Credit.
(c) On or prior to January 20, 2000, Borrower and Junior
Lender shall deliver or cause to be delivered to the Collateral Agent the
following (the form and substance of each of which shall be subject to the
approval of the Administrative Agent and the Syndication Agent (not to be
unreasonably withheld or delayed)), all of which shall be duly executed by the
Junior Lender and, to the extent applicable, Borrower: (i) a pledge agreement,
limited recourse guaranty, an assignment of mortgage, financing statements, and
such other documents as the Administrative Agent and the Syndication Agent shall
reasonably require in order for the Collateral Agent to hold a perfected first
priority Lien on and security interest in the Junior Loan Documents as
additional security for the Loan (collectively, the "Pledge Documents"), (ii)
such documents and financing statements as the Administrative Agent and the
Syndication Agent shall reasonably require in order for the Collateral Agent to
hold a perfected first priority Lien on and security interest in the SNDA
Deposit Escrow Account and the related Bank Account Collateral as security for
the payment of the Indebtedness (the "SNDA Account Documents") and (iii) the
Escrow Agreement.
(d) The Pledge Documents shall contain, among other things,
provisions to the following effect:
(i) Immediately after Borrower or any Affiliate thereof
receives notice or otherwise obtains knowledge of any Tenant Claim (other than
Existing Claims), Borrower shall furnish to Administrative Agent a certificate,
reasonably satisfactory to Administrative Agent, pursuant to which Borrower
describes such Tenant Claim, in reasonable detail (including, without
limitation, the estimated amount of each such Tenant Claim), together with all
tenant notices and other relevant materials relating to such Tenant Claim;
(ii) On February 25, 2000 and thereafter on the twenty-fifth
(25th) day of each calendar month thereafter occurring, all Excess Cash Flow for
the immediately preceding Interest Accrual Period shall be paid directly by
Borrower to Collateral Agent to be held in the SNDA Deposit Escrow Account as
security for the Indebtedness until the amount of funds then on deposit in the
SNDA Deposit Escrow Account is equal to the aggregate amount of the Tenant
Claims that are then outstanding (as determined by Administrative Agent, in its
reasonable discretion), at which point Excess Cash Flow shall be payable to
Borrower until such time(s), if any, as the aggregate amount of Tenant Claims
shall exceed the amount of funds then on deposit in the SNDA Deposit Escrow
Account, at which time Excess Cash Flow shall again be payable to Collateral
Agent as aforesaid.
(iii) If and when (A) Borrower shall provide to the
Administrative Agent, a certificate reasonably acceptable to the Administrative
Agent pursuant to which Borrower shall certify that a particular outstanding
Tenant Claim has been, (or, upon the payment by Collateral Agent out of the
funds then on deposit in the SNDA Deposit Escrow Account to the tenant in
question of a sum certain will be) unconditionally released by the tenant in
question (together with a "clean" tenant estoppel certificate or other writing
executed by the tenant in question, in any case, reasonably satisfactory to the
Administrative Agent, substantiating the accuracy of Borrower's certificate (and
in the case where the "quid pro quo" for the delivery by the tenant of its
release as aforesaid is a rent abatement or future payments or obligations by
Borrower to such tenant, a copy of the document(s) setting forth the same (which
must comply with the applicable provisions of the Loan Documents)) and (B) the
Administrative Agent, in its reasonable discretion, shall have confirmed the
accuracy of such certificate, then Administrative Agent shall direct Collateral
Agent to release to such tenant (or if the "quid pro quo" for the delivery by
the tenant of its release as aforesaid is a rent abatement as aforesaid, to
Borrower) funds then on deposit in the SNDA Deposit Escrow Account in the amount
equal to such Tenant Claim (or, in the case of a settlement between Borrower and
a tenant that involves installment payments by Borrower, the amount of the
installment that will be payable within the next thirty days). If and when the
aggregate amount of all Tenant Claims then outstanding shall be $250,000 or
less, provided that no Default or Event of Default shall then exist (the date
upon which all of the foregoing conditions shall be satisfied, the "Tenant Claim
Satisfaction Date"), the Administrative Agent shall direct Escrow Agent to
release all funds then on deposit in the SNDA Deposit Escrow Account and
terminate the Pledge Documents (other than any provisions thereof, if any, that
by their terms survive satisfaction of the Indebtedness) and return the Junior
Loan Documents to Junior Lender.
(e) As used herein, the "Escrow Agreement" means an escrow
agreement, reasonably satisfactory to Administrative Agent and Collateral Agent,
executed and delivered by Borrower and Junior Lender for the benefit of the
Collateral Agent, and which contains such indemnities, limitations of liability
and other escrow-related provisions as Escrow Agent shall reasonably require as
well as provisions, among others, to the following effect:
(i) the Escrow Agent shall hold the Pledge Documents, the
Junior Loan Documents and the SNDA Account Documents until March 20, 2000
("Outside Date");
(ii) if, on the Outside Date, the aggregate amount of all
Tenant Claims then outstanding shall be $250,000 or less, then, so long as no
Default or Event of Default shall then exist, Administrative Agent shall direct
Escrow Agent to release all funds then on deposit in the SNDA Deposit Escrow
Account to Borrower and return the Junior Loan Documents to Junior Lender;
(iii) if, on the Outside Date, the aggregate amount of all
Tenant Claims then outstanding shall be greater than $250,000, then (A) at any
time thereafter, Collateral Agent shall be entitled to cause Escrow Agent to
release from escrow and deliver to Collateral Agent the Junior Loan Documents,
the Pledge Documents and the SNDA Account Documents, (B) on the date upon which
Escrow Agent releases the Junior Loan Documents, the Pledge Documents and the
SNDA Account Documents to Collateral Agent as described in the immediately
preceding clause "(A)", Borrower and Junior Lender shall cause to be delivered
to Administrative Agent, an opinion or opinions of counsel reasonably
satisfactory to the Administrative Agent with respect to the enforceability of
the Pledge Documents and the SNDA Account Documents and such other matters as
the Administrative Agent shall reasonably request and (C) Borrower shall pay all
reasonable costs and expenses incurred by the Agents and/or the Lenders in
connection with the transactions contemplated by this Section 2.9, the Pledge
Documents, the SNDA Account Documents or the Escrow Agreement, including,
without limitation, reasonable attorneys' fees, disbursements and other
expenses.
(f) Borrower shall use commercially reasonable efforts to
cause the tenants under the SNDA Required Leases to execute and deliver SNDA's
as expeditiously as possible.
(g) Borrower and the Junior Lender hereby agree that all
interest on the Junior Note that is not paid to the Junior Lender pursuant to
the provisions of this Section 2.9 shall accrue interest to the extent set forth
in the Junior Note and shall be due when there is Excess Cash Flow available to
pay it (in any such case, to the extent permitted under the Loan Documents and
the Junior Loan Documents).
Section 2.10. Taxes.
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(a) All payments made by the Borrower under any Note, this
Agreement or any other Loan Document shall be made free and clear of, and
without deduction or withholding for or on account of, any present or future
income, stamp or other taxes, assessments, levies, imposts, duties, charges,
fees, deductions or withholdings, now or hereafter imposed, levied, collected,
withheld or assessed by any Governmental Authority (other than gross receipts
taxes, net income taxes and franchise taxes (imposed in lieu of net income
taxes) imposed on any Agent or any Lender (including, without limitation, any
Assignee of a Lender) or Participant as a result of a payment under the Loan
Documents) (all such non-excluded taxes, levies, imposts, duties, charges, fees,
deductions and withholdings being hereinafter collectively referred to as
"Taxes"). If any Taxes are required to be withheld from any amounts payable to
any Agent, any such Lender, or any Participant hereunder, under any Note or
under any other Loan Document, the amounts so payable to such Agent, such Lender
or such Participant, as applicable, shall be increased to the extent necessary
to yield to such Agent, such Lender, or such Participant, as applicable, (after
payment of all Taxes) such amounts payable at the rates or in the amounts, as
applicable, specified in the applicable Loan Document. Whenever any Taxes are
payable by the Borrower, as promptly as possible thereafter the Borrower shall
send to the affected Agent, the affected Lender or the affected Participant, as
applicable, for its own account a certified copy of an official receipt showing
payment thereof.
(a)(b) Any Lender (including, without limitation, any Assignee
of any Lender) or Participant that is organized under the laws of a jurisdiction
outside the United States of America (a "Foreign Lender") as to which payments
to be made under this Agreement or any other Loan Document are exempt from or
subject to a reduced rate of United States Federal withholding tax under an
applicable statute or tax treaty ("Exempt Payments") shall (x) provide to the
Administrative Agent for the benefit of the Lenders and to the Borrower, on or
prior to the date upon which such Foreign Lender becomes a Lender or
Participant, as applicable, a properly completed and executed IRS Form 4224,
Form 1001 or Form W-8 or other applicable form, certificate or document
prescribed by the Internal Revenue Service or the United States of America
certifying as to such Foreign Lender's entitlement to such exemption or
reduction (all of the foregoing, "Exemption/Reduction Forms") and (y) represent
to the transferor Lender (for the benefit of the transferor Lender, the
Administrative Agent and the Borrower), in writing, that such Foreign Lender is
entitled, under applicable Legal Requirements, to such exemption or reduction
(which writing shall also contain an indemnification by such Foreign Lender in
favor of the transferor Lender, the Agents and the Borrower from any damages,
loss, cost or expense (including, without limitation, reasonable attorney's
fees, disbursement and expenses) resulting from a breach of such
representation). Each such Foreign Lender shall also deliver appropriate
replacement Exemption/Reduction Forms promptly upon the obsolescence or
invalidity of any such Exemption/Reduction Form previously delivered by such
Foreign Lender.
(c) The Borrower shall not be required to pay any additional
amounts to any Foreign Lender under subsection 2.10(a) to the extent that (i)
the obligation to withhold amounts with respect to United States Federal
withholding tax existed on the date such Foreign Lender became a Lender or a
Participant, as applicable, (ii) the obligation to pay such additional amounts
would not have arisen but for a failure by such Foreign Lender or to provide an
Exemption/Reduction Form in accordance with the provisions of subsection 2.10(b)
or (iii) a representation or warranty made or deemed to be made by such Foreign
Lender in any Exemption/Reduction Form proves to have been incorrect, false or
misleading in any material respect when so made or deemed to have been made.
(d) Unless the Administrative Agent and the Borrower shall
have received Exemption/Reduction Forms in accordance with the provisions of
subsection 2.10(b), the Borrower and the Administrative Agent shall withhold
Taxes from applicable payments under the Loan Documents at the applicable
statutory rate. In the event that, after the date that a Foreign Lender becomes
a Lender or Participant, as applicable, Taxes consisting of a withholding tax of
the United States of America or any political subdivision thereof shall become
applicable to payments made to such Lender or Participant, as applicable, such
Lender or Participant, as applicable, shall use its best efforts to transfer the
Note(s) (or the interest therein) that it holds to another lending office of
such Foreign Lender if such transfer would avoid or reduce such Taxes and would
not in the sole opinion of such Foreign Lender be otherwise disadvantageous to
such Foreign Lender.
(e) The provisions of this Section 2.10 shall survive the
termination of this Agreement and the payment and performance of all obligations
under the Loan Documents.
Section 2.11. Mortgage Recording Taxes. The Lien to be created
by the Deed of Trust is intended to encumber the Trust Property described
therein to the full extent of the Loan Amount. On the Closing Date, the Borrower
shall have paid all state, county and municipal recording and all other Taxes
imposed upon the execution and recordation of the Deed of Trust.
Section 2.12. Mall Retainage Escrow Account; Tax Escrow
Accounts; REA Insurance Premium Escrow Account; Brokerage Commission Account; TI
Costs Account; Operating Expense Account; Springing Cash Management Account. (a)
On or before the Closing Date, the Collateral Agent shall establish and
maintain, in accordance with the terms of the Mall Retainage Pledge Agreement,
the Mall Retainage Escrow Account (as defined in the Mall Retainage Pledge
Agreement). On the Closing Date, Borrower shall cause to be funded into the Mall
Retainage Escrow Account, the Mall Retainage Punchlist Amount. Borrower's and
the Agents' and the Lenders' respective rights and obligations with respect to
the Mall Retainage Escrow Account and the Mall Retainage Escrow Account
Collateral are set forth in the Mall Retainage Escrow Agreement and the Mall
Retainage Escrow Pledge Agreement.
(a)(b) On or before the Closing Date, the Collateral Agent
shall establish and maintain, in accordance with the terms of the Cash
Collateral Agreement, the Tax Escrow Account (as defined in the Cash Collateral
Agreement). On the Closing Date, Borrower shall deposit Funds (other than
proceeds of the Loan) in the amount of $180,157.29 into the Tax Escrow Account.
On each Deposit Date, the Borrower shall deposit into the Tax Escrow Account
Funds in an amount equal to the greater of (x) one-twelfth (1/12) of the Taxes
and Other Charges that the Administrative Agent, in good faith, shall estimate
will be payable during the next following twelve (12) months or (y) the Taxes
and Other Charges that the Administrative Agent, in good faith, shall estimate
will be payable during the next following three (3) months (but in no event less
than the amount that the Administrative Agent, in good faith, determines shall
be necessary in order to accumulate in the Tax Escrow Account sufficient funds
to pay all Taxes and Other Charges at least fifteen (15) Business Days prior to
their respective delinquency dates). In determining, at any given time, the
amounts to be deposited by the Borrower into the Tax Escrow Account pursuant to
this subsection 2.12(b), the Administrative Agent shall take into account the
Bank Account Collateral, if any, then on deposit in the Tax Escrow Account and
not necessary, in the good faith determination of the Administrative Agent, to
pay Taxes and Other Charges.
(c) Borrower shall make the deposits into the REA Insurance
Premium Escrow Account in the amounts, and at the times, that Borrower is
required so to do under the REA.
(d)(i) On or before the Closing Date, the Collateral Agent
shall establish and maintain, in accordance with the terms of the Cash
Collateral Agreement, the Brokerage Commission Account (as defined in the Cash
Collateral Agreement). On the Closing Date Borrower shall deposit into the
Brokerage Commission Account Funds (other than proceeds of the Loan) in the
amount of the Brokerage Commissions Deposit. If, at any time, (A) Borrower shall
provide a certificate (together with appropriate back-up materials) reasonably
acceptable to the Administrative Agent that there would be Realized Savings (as
defined in the FADAA) if the amount of funds then on deposit in the Brokerage
Commissions Account were a Line Item (as defined in the FADAA) in a Project
Budget (as defined in the FADAA), and (B) the Administrative Agent, in its
reasonable discretion, shall confirm the accuracy of such certificate, then,
provided no Default or Event of Default shall then exist, Borrower shall be
entitled to direct the Administrative Agent to direct the Collateral Agent to
disburse funds to Borrower in the amount of such Realized Savings.
(ii) On or before the Closing Date, the Collateral Agent shall
establish and maintain, in accordance with the terms of the Cash Collateral
Agreement, the TI Costs Account (as defined in the Cash Collateral Agreement).
On the Closing Date Borrower shall deposit into the TI Costs Account Funds
(other than proceeds of the Loan) in the amount of the TI Costs Deposit. If, at
any time, (A) Borrower shall provide a certificate (together with appropriate
back-up materials) reasonably acceptable to the Administrative Agent (x) that
there would be Realized Savings (as defined in the FADAA) if the amount of funds
then on deposit in the TI Costs Account were a Line Item (as defined in the
FADAA) in a Project Budget (as defined in the FADAA), and (y) there is no
Default or Event of Default and (B) the Administrative Agent, in its reasonable
discretion, shall confirm the accuracy of such certificate, then, provided that
no Default or Event of Default shall then exist, the Administrative Agent shall
direct the Collateral Agent to disburse funds to Borrower in the amount of such
Realized Savings. If, at any time, the amount of funds then on deposit in the TI
Costs Account is less than the Required Minimum TI Budget Amount (as defined in
the FADAA), as determined by the Administrative Agent in its reasonable
discretion, then Borrower, within five days thereafter, shall deposit Funds into
the TI Costs Account to the extent necessary for there to be on deposit in the
TI Costs Account, the Required Minimum TI Budget Amount.
(iii) On or before the Closing Date, the Collateral Agent
shall establish and maintain in accordance with the terms of the Cash Collateral
Agreement the Management Fees Escrow Account (as defined in the Cash Collateral
Agreement). Within fifteen (15) days after the Closing Date, and on the first
day of each calendar quarter thereafter, the Borrower shall deposit into the
Management Fees Escrow Account Funds in an amount equal to the projected
Management Fees that Borrower will be required to pay during the next following
three months under the Management Agreement (as reasonably estimated by
Administrative Agent).
(iv) On or before the Closing Date, the Collateral Agent shall
establish and maintain, in accordance with the terms of the Cash Collateral
Agreement and Section 2.9 hereof, the SNDA Deposit Escrow Account (as defined in
the Cash Collateral Agreement).
(e) The Borrower shall have no right of withdrawal from the
Bank Accounts and the Bank Accounts shall be maintained in the name of and
subject to the exclusive dominion and control of the Collateral Agent for the
benefit of the Lenders (except as otherwise expressly set forth in this Section
2.12).
(f) Any and all Moneys remitted to a Bank Account, together
with any Permitted Investments in which such Moneys are or shall be invested or
reinvested during the term of this Agreement and all amounts earned, credited or
received with respect to such Moneys and Permitted Investments, shall be held in
such Bank Account (except as provided for in the Pledge Agreement and Cash
Collateral Agreement), and applied in accordance with the terms hereof.
(g) As directed by the Administrative Agent, the Collateral
Agent will withdraw from the Tax Escrow Account amounts as are necessary, and
shall use such amounts, to pay Taxes and Other Charges that are then payable and
with respect to which the Administrative Agent shall have received a bill,
statement or estimate from a public office or other Governmental Authority;
provided that it shall be the Borrower's, and not the Administrative Agent's,
obligation to ensure that the Administrative Agent receives all such bills,
statements and estimates. In making any payment from the Tax Escrow Account in
respect of Taxes and Other Charges, the Administrative Agent may do so according
to any bill, statement or estimate received from a public office or other
Governmental Authority without inquiry as to the accuracy or validity of such
bill, statement or estimate or into the validity of any Imposition, sale,
forfeiture, Tax Lien or title or claim thereof; provided that the Collateral
Agent shall not make a given payment if (x) the Borrower shall be contesting its
obligation to make such payment in accordance with the provisions of Section 23
of the Deed of Trust and (y) the Collateral Agent and the Administrative Agent
shall have received from the Borrower notice of the same prior to the Collateral
Agent's making of such payment. If, at any time, the Administrative Agent, in
good faith, shall determine that the amount that is or will be in the Tax Escrow
Account fifteen (15) Business Days prior to the date upon which any Taxes and
Other Charges will be delinquent, then Borrower, promptly upon receipt thereof
of notice from the Administrative Agent, shall pay to the Administrative Agent,
for deposit into the Tax Escrow Account, Funds necessary (as determined by the
Administrative Agent in good faith) to pay, at least fifteen (15) Business Days
prior to delinquency all Taxes and Other Charges.
(h)(1) On or before the Closing Date, the Collateral Agent
shall establish and maintain at its office located at One Liberty Plaza, New
York, NY 10006 (or such other office of Collateral Agent as the Collateral Agent
shall designate in a notice to Borrower, the Lenders and the other Agents) an
Eligible Account specified in writing by Collateral Agent to Borrower (such
Eligible Account, together with any other Eligible Account that the Collateral
Agent shall establish in lieu thereof, the "Operating Expense Account").
(2) Within fifteen (15) days after the Closing Date, Borrower
shall either (A) deposit into the Operating Expense Account Funds in an amount
equal to the Operating Expense Deposit or (B) furnish to Collateral Agent, on
behalf of the Lenders, a Letter of Credit in an amount that is equal to the
Operating Expense Deposit and with a term of six (6) months (which Letter of
Credit must, at all times prior to the Operating Expense Revenue Achievement
Date, be replaced, at least thirty (30) days prior to each expiration date
thereof, with either (x) a Letter of Credit providing for an expiration date
that occurs six (6) months from the expiration date of the Letter of Credit
being replaced or (y) Funds in an amount equal to the Operating Expense Deposit,
which Funds shall be held in the Operating Expense Account), together with an
Account Party Sideletter executed and delivered by the account party under the
Letter of Credit.
(3) If (A) Borrower shall provide a certificate (together with
appropriate back-up materials) reasonably acceptable to the Administrative Agent
that the Operating Expense Revenue Achievement Date has occurred and (B) the
Administrative Agent, in its reasonable discretion, shall have confirmed the
accuracy of such certificate, then, so long as no Default or Event of Default
shall then exist, the Collateral Agent upon notice from the Administrative Agent
(which the Administrative Agent shall be obligated to give) shall release all
funds then on deposit in the Operating Expense Account to the Borrower for its
own account or shall return the Letter of Credit, as applicable. Furthermore,
notwithstanding anything to the contrary contained herein, if the Operating
Expense Revenue Achievement Date shall occur on the Closing Date or within
fifteen (15) days after the Closing Date, then Borrower shall not, at such time
or thereafter, be required to deposit the Operating Expense Deposit into the
Operating Expense Account and shall not, at such time or thereafter, be required
to furnish a Letter of Credit in lieu thereof. Borrower shall furnish to
Administrative Agent, promptly upon request therefor by the Administrative Agent
made from time to time, and as a condition precedent to the obligations of
Administrative Agent and Collateral Agent under this subparagraph (3), all rent
information, Leases and information regarding the creditworthiness of tenants
that the Administrative Agent shall reasonably request to determine whether the
Operating Expense Revenue Achievement Date has occurred.
(4) If (A) Borrower shall provide a certificate (together with
appropriate back-up materials) reasonably acceptable to the Administrative Agent
that the TI Costs Revenue Achievement Date has occurred and (B) the
Administrative Agent, in its reasonable discretion, shall have confirmed the
accuracy of such certificate, then, so long as no Default or Event of Default
shall then exist, the Collateral Agent upon notice from the Administrative Agent
(which the Administrative Agent shall be obligated to give) shall release all
funds then on deposit in the TI Costs Account to the Borrower for its own
account. Borrower shall furnish to Administrative Agent, promptly upon request
therefor by the Administrative Agent made from time to time, and as a condition
precedent to the obligations of Administrative Agent and Collateral Agent under
this subparagraph (4), all rent information, Leases and information regarding
the creditworthiness of tenants that the Administrative Agent shall reasonably
request to determine whether the TI Costs Revenue Achievement Date has occurred.
(5) Subject to the other provisions of this Section 2.12, the
Collateral Agent shall disburse funds from time to time on deposit in the
Brokerage Commission Account or the TI Costs Account to the Borrower to pay
Brokerage Commissions or TI Costs for which the Borrower shall not have
previously requested a disbursement of funds from the applicable Account and
that are then due and payable or that will be due and payable within the thirty
(30) days next following the requested disbursement date ("Leasing Costs") upon
satisfaction of each of the following conditions:
(A) no Default or Event of Default shall exist on the date
upon which the Borrower furnishes a Leasing Cost Disbursement Request (as
defined in clause (B) below) to the Collateral Agent and to the Administrative
Agent or the date upon which the requested disbursement is to be made;
(B) at least ten (10) (but no more than thirty (30)) days
prior to the date on which the Borrower desires for the Collateral Agent to
disburse such funds, the Borrower shall have given to the Collateral Agent and
to the Administrative Agent a written request for such disbursement (a "Leasing
Cost Disbursement Request") specifying, in reasonable detail, the Leasing Costs
to which such funds are to be applied (and the amount of each Leasing Cost), the
amount of the disbursement sought, and the date upon which the Borrower desires
for the Collateral Agent to disburse such funds; and
(C) the Leasing Cost Disbursement Request shall be accompanied
(1) by a Borrower's Certificate, in form and substance reasonably satisfactory
to the Administrative Agent, certifying that the Leasing Costs for which the
Borrower is seeking the disbursement of funds have been incurred by the Borrower
and are then due and payable (or will be due and payable within the next
following thirty (30) days) and (2) invoices or other evidence reasonably
satisfactory to the Administrative Agent that the Leasing Costs in question are
then due and payable (or will be due and payable within the next following
thirty (30) days).
(6) Subject to the other provisions of this Section 2.12, the
Collateral Agent shall disburse funds from time to time on deposit in the
Management Fees Escrow Account to the Borrower to pay Management Fees for which
the Borrower shall not have previously requested a disbursement of funds from
the Management Fees Escrow Account and that are then due and payable under the
Management Agreement or that will be due and payable under the Management
Agreement within the thirty (30) days next following the requested disbursement
date upon satisfaction of each of the following conditions:
(A) no Default or Event of Default shall exist on the date
upon which the Borrower furnishes a Management Fees Disbursement Request (as
defined in clause (B) below) to the Collateral Agent and to the Administrative
Agent or the date upon which the requested disbursement is to be made; provided
that the Administrative Agent may (but shall not be required by Borrower to)
elect to cause Collateral Agent to make the requested disbursement
notwithstanding any Default or Event of Default;
(B) at least ten (10) (but no more than thirty (30)) days
prior to the date on which the Borrower desires for the Collateral Agent to
disburse such funds, the Borrower shall have given to the Collateral Agent and
to the Administrative Agent a written request for such disbursement (a
"Management Fees Disbursement Request") specifying, in reasonable detail, the
amount of the disbursement sought, and the date upon which the Borrower desires
for the Collateral Agent to disburse such funds; and
(C) the Management Fees Disbursement Request shall be
accompanied (1) by a Borrower's Certificate, in form and substance reasonably
satisfactory to the Administrative Agent, certifying that the Management Fees
for which the Borrower is seeking the disbursement of funds have been incurred
by the Borrower and are then due and payable (or will be due and payable within
the next following thirty (30) days) and (2) invoices or other evidence
reasonably satisfactory to the Administrative Agent that the Management Fees in
question are then due and payable (or will be due and payable within the next
following thirty (30) days).
(i)(i) Within fifteen (15) days after the Trust Property shall
first have been open for business for six (6) consecutive full calendar months,
and, thereafter, within fifteen (15) days after request therefor by the
Administrative Agent (which request shall be made not more than once during any
calendar month) (each such fifteenth (15th) day, a "Delivery Date"), or at any
time as Borrower shall desire to do so (but in no event more than once per
calendar month) Borrower shall furnish to the Administrative Agent (for its
reasonable approval) a calculation of the DSCR with respect to the period of six
full calendar months immediately preceding such Delivery Date (each such
six-month period, a "Preceding Period"), together with all relevant financial
and other information and materials relating to such calculation (collectively,
"DSCR Materials"). If the DSCR for any such Preceding Period shall be less than
1.25 or Borrower shall fail to furnish such DSCR Materials to the Administrative
Agent within 15 days after Administrative Agent's request (except in the case of
the initial deliver of DSCR Materials required hereunder) as aforesaid (either
of the foregoing, a "DSCR Event"), then, during the period commencing on the
applicable Delivery Date and ending at such future time as the DSCR for the
Trust Property for six consecutive full calendar months shall equal or exceed
1.25 (each, a "DSCR Period"), and for each DSCR Period thereafter occurring, the
provisions of paragraph (ii) below shall be applicable.
(ii) Promptly upon the occurrence of a DSCR Event, the
Collateral Agent shall establish and maintain at an office to be determined and
designated in a notice to Borrower, the Lenders and the other Agents) an
interest bearing deposit account that is an Eligible Account specified in
writing by Collateral Agent to Borrower (such Eligible Account, together with
any other Eligible Account that the Collateral Agent shall establish in lieu
thereof, the "Cash Management Account").
(iii) If, at any time, a DSCR Event shall occur, then (A)
Borrower will cause all Rents to be deposited directly into the Cash Management
Account on a daily basis and (B) if on the last banking day prior to the date of
the Loan interest payment that is then next due, the funds in the Cash
Management Account are less than the amount of the Loan interest payment then
due, Borrower shall deposit the shortfall into the Cash Management Account. The
Collateral Agent shall have control over, and a first priority security interest
in, the Cash Management Account and all Bank Account Collateral relating
thereto. At any time that no Event of Default shall exist, Borrower shall have
the right to make withdrawals from the Cash Management Account solely for the
purpose of paying amounts payable in respect of the Indebtedness, any bona fide
Operating Expenses or Capital Expenditures relating to the Trust Property that
are certified as such by Borrower pursuant to an Officer's Certificate, Tax
Distributions and any other expenditures that are approved by the Administrative
Agent (collectively, "Permitted Payments"). The Collateral Agent shall have the
right to debit the Cash Management Account in payment for each monthly interest
payment and any other amounts owed to any Lender or Agent under the Loan
Documents. All interest earned under the Cash Management Account shall be
credited to Borrower. Promptly upon request therefor by the Administrative
Agent, Borrower shall execute and deliver to the Collateral Agent all documents,
instruments and financing statements that the Administrative Agent shall
reasonably require in order for the Collateral Agent to obtain a perfected first
priority security interest in the Cash Management Account and all Bank Account
Collateral relating thereto including, but not limited to, a cash collateral
agreement with respect to the Cash Management Account on terms and conditions
similar to the Cash Collateral Agreement, with such changes to recognize that
the Cash Collateral Account is an interest bearing depository account as shall
be reasonably acceptable to Agents and such legal opinion(s) as the
Administrative Agent shall reasonably require. If, at any time after a DSCR
Event shall occur, the DSCR for the Property for six consecutive full calendar
months shall equal or exceed 1.25, then, provided no Event of Default shall then
exist, the Collateral Agent shall release the funds then on deposit in the Cash
Management Account to Borrower.
(j) The Collateral Agent, at the direction of the
Administrative Agent, shall cause the Moneys in the Bank Accounts and in the
Mall Retainage/Punchlist Escrow Account to be invested and reinvested in one or
more Permitted Investments; provided that the Borrower, upon reasonable prior
notice given by the Borrower to the Collateral Agent, shall be entitled to
select a particular Permitted Investment(s) so long as no Default or Event of
Default shall then exist. All such Permitted Investments shall be made in the
name of and be under the sole dominion and control of the Collateral Agent for
the benefit of the Lenders. The Collateral Agent shall direct that all income or
other gain from investments of Money held in any Bank Account and/or the Mall
Retainage/Punchlist Account be deposited in such Bank Account or the Mall
Retainage/Punchlist Account upon receipt thereof and any loss resulting from
such investments shall be charged to such Bank Account or the Mall
Retainage/Punchlist Account. The Borrower shall include all such income or gain
on any Bank Account and/or the Mall Retainage/Punchlist Account as income of the
Borrower for federal and applicable state tax purposes. Notwithstanding the
foregoing, the Administrative Agent shall be entitled, without notice or
liability to the Borrower, to direct the Collateral Agent to (and, promptly upon
receiving such direction, the Collateral Agent, in accordance with such
directions, shall) liquidate Permitted Investments and/or to cause Moneys on
deposit in the Bank Accounts and the Mall Retainage/Punchlist Account not to be
invested or reinvested in Permitted Investments if (x) the Administrative Agent,
in good faith, determines that it is prudent or necessary to do so in order to
honor a disbursement request from the Borrower or (y) an Event of Default shall
exist.
(k) The Collateral Agent shall not be required to (i) disburse
funds from any Start-Up Costs Escrow Account more than once during any calendar
month or (ii) disburse funds from any Bank Account (including, without
limitation, any Start-Up Costs Escrow Account) in excess of the amount of cash
then on deposit in such Bank Account.
(l)(1) Borrower shall use any funds disbursed to Borrower
pursuant to the provisions of subsection 2.12(h)(5) hereof to pay the Leasing
Costs with respect to which such funds were requested. Borrower shall
immediately redeposit into the applicable Start-Up Cost Escrow Account (such
redeposited funds to constitute Bank Account Collateral), any funds not used by
Borrower, within sixty (60) days of the date disbursed, to pay the Leasing Costs
with respect to which such funds were requested. Borrower shall furnish to the
Collateral Agent and the Administrative Agent, within fifteen (15) Business Days
of request therefor by the Administrative Agent, evidence, reasonably
satisfactory to the Administrative Agent, that Borrower used funds disbursed
under subsection 2.12(h)(5) hereof to pay the Leasing Costs with respect to
which such funds were requested.
(2) Borrower shall use any funds disbursed to Borrower
pursuant to the provisions of subsection 2.12(h)(6) hereof to pay the Management
Fees with respect to which such funds were requested. Borrower shall immediately
repay to the Collateral Agent, to be redeposited into the Management Fees Escrow
Account and held as Bank Account Collateral, any funds not used by Borrower,
within sixty (60) days of the date disbursed, to pay the Management Fees with
respect to which such funds were requested. Borrower shall furnish to the
Collateral Agent and the Administrative Agent, within fifteen (15) Business Days
of request therefor by the Collateral Agent or the Administrative Agent,
evidence, reasonably satisfactory to the Administrative Agent, that Borrower
used funds disbursed under subsection 2.12(h)(5) hereof to pay the Management
Fees with respect to which such funds were requested.
(m) Borrower shall use any funds disbursed to Borrower
pursuant to the provisions of subsection 2.12(i) hereof to pay Permitted
Payments. Borrower shall immediately redeposit into the Cash Management Account
(such redeposited funds to constitute Bank Account Collateral), any funds not
used by Borrower, within sixty (60) days of the date disbursed, to pay Permitted
Payments. Borrower shall furnish to the Administrative Agent, within fifteen
(15) Business Days of request therefor by the Administrative Agent, evidence,
reasonably satisfactory to the Administrative Agent, that Borrower used funds
disbursed under subsection 2.12(i) hereof to pay Permitted Payments.
(n) Without limiting any other provision of this Agreement,
if, at any time, an Event of Default shall exist, then the Collateral Agent may
at any time thereafter, without demand of performance or other demand,
advertisements and/or notices of any kind (all of which demands, advertisements,
and/or notices are hereby expressly waived), withdraw the Bank Account
Collateral from the Bank Accounts and apply the Bank Account Collateral to the
payment of the Indebtedness as the Required Lenders shall determine in their
sole discretion and the Collateral Agent may sell all or any portion of the
instruments and securities constituting part of the Bank Account Collateral and
apply the Bank Account Collateral and/or the Proceeds to the payment of the
Indebtedness as aforesaid. No Agent and no Lender shall have any responsibility
for any loss of value to the Bank Account Collateral resulting from the timing
of any such sale.
(o) Upon payment and satisfaction in full of the Loan and of
all other obligations and liabilities of the Borrower under the Loan Documents
(but excluding any indemnification obligations that shall not have theretofore
arisen and that shall survive the payment of the Principal Indebtedness), the
Collateral Agent shall release any and all amounts on deposit in the Bank
Accounts and Mall Retainage Punchlist Account to the Borrower; provided that, if
any Person other than Borrower shall make or assert a claim to, or with respect
to, such amounts, the Collateral Agent shall be entitled to retain such amounts
until such claim shall be finally determined by a court of competent
jurisdiction or otherwise act as required under applicable law.
(p) On the tenth Business Day of each calendar month, the
Collateral Agent shall furnish to the Administrative Agent, each Lender and the
Borrower a reasonably detailed statement of all deposits into and disbursements
from the Accounts during the immediately preceding month and during the period
from the beginning of the calendar year in which such month occurs to the end of
such month.
(q) Notwithstanding anything else contained herein to the
contrary, the parties hereto agree that Collateral Agent may operate the
Accounts in accordance with the provisions of Section 4 of each of the Pledge
Agreement and the Cash Collateral Agreement.
Section 2.13. Regulatory Change, etc. If, as a result of any
----------------------
Regulatory Change:
(a) the basis of taxation of payments to any Lender or any
company controlling any Lender of the principal of or interest on the Loan is
changed; or (b) any reserve, special deposit or similar requirements (other than
such requirements as are taken into account, pursuant to the definition of
"Adjusted LIBOR", in determining Adjusted LIBOR) relating to any extensions of
credit or other assets of, or any deposits with or other liabilities of, any
Lender or any company controlling any Lender is imposed, modified or deemed
applicable; or (c) any other condition affecting the Loan is imposed on any
Lender or any company controlling any Lender and such Lender reasonably
determines that, by reason thereof, the cost to such Lender or any company
controlling such Lender of making or maintaining the Loan is increased, or any
amount receivable by such Lender or any company controlling such Lender in
respect of any portion of the Loan is reduced, in each case by an amount deemed
by such Lender, in good faith, to be material (such increases in cost and
reductions in amounts receivable being herein called "Increased Costs"), then
Borrower agrees that it will pay to such Lender upon such Lender's request such
additional amount or amounts as will compensate such Lender or any company
controlling such Lender for such Increased Costs to the extent such Lender
reasonably determines that such Increased Costs are allocable to the Loan. Such
Lender will notify Borrower of any event occurring after the date hereof which
will entitle such Lender to compensation pursuant to this Section as promptly as
practicable after it obtains knowledge thereof and determines to request such
compensation. Such Lender agrees that, as promptly as practicable after the
officer of such Lender responsible for administering its portion of the Loan
becomes aware of the occurrence of an event or the existence of a condition that
would cause such Lender to become entitled to a payment in respect of Increased
Costs, it will, to the extent not inconsistent with the internal policies of
such Lender and any applicable legal or regulatory restrictions, use reasonable
efforts (i) to make, issue, fund or maintain its portion of the Loan through
another lending office of such Lender, or (ii) to take such other measures as
such Lender may deem reasonable, if as a result thereof the circumstances which
would cause such Lender to be entitled to such payment would cease to exist or
the amounts which would otherwise be required to be paid to such Lender pursuant
to this Section would be materially reduced and if, as determined by such Lender
in its sole discretion, the making, issuing, funding or maintaining of its
portion of the Loan through such other lending office or in accordance with such
other measures, as the case may be, would not otherwise materially adversely
affect the interests of such Lender; provided that such Lender will not be
obligated to utilize such other lending office pursuant to this Section unless
Borrower agrees to pay all incremental expenses incurred by such Lender as a
result of utilizing such other lending office (provided that such incremental
expenses are less than the Increased Costs payment which would otherwise be due
to such Lender). Notwithstanding the foregoing, in no event shall Borrower be
required to compensate such Lender for any portion of the income, gross receipts
or franchise taxes of such Lender or the company controlling such Lender. If a
Lender requests compensation under this Section, Borrower may, by notice to such
Lender, require that such Lender furnish to Borrower a statement setting forth
the basis for requesting such compensation and the method for determining the
amount thereof. The amounts payable by the Borrower under this Section 2.13 to
any Lender shall be without duplication of amounts payable by the Borrower under
Section 2.10 hereof to such Lender.
Section 2.14. Unavailability, etc. Without limiting the effect
of Section 2.13, in the event that, (a) by reason of any Regulatory Change, (i)
a Lender or a company controlling such Lender incurs Increased Costs based on or
measured by the excess above a specified level of the amount of a category of
deposits or other liabilities of such Lender or such company controlling a
Lender, which includes, without limitation, deposits by reference to which
Adjusted LIBOR is determined and (ii) the cost to Borrower of converting the
interest rate applicable to the Outstanding Principal Indebtedness to the Base
Rate as described below is less than the aggregate amount of such Increased
Costs, (b) the Administrative Agent shall have determined in good faith after
reasonable investigation that Dollar deposits in the principal amount of the
Loan are not generally available in the London interbank market, (c) reasonable
means do not exist for ascertaining Adjusted LIBOR or (d) it shall be unlawful
for a Lender to make or maintain a Loan Advance that bears interest at an
interest rate based upon LIBOR, then, in the case of (d), automatically, and in
the case of (a), (b) or (c), if the Required Lenders so elect, the
Administrative Agent shall so notify Borrower, and, in any such case, the
interest rate applicable to the Outstanding Principal Indebtedness shall be
converted to the Base Rate on the last day of the applicable Interest Accrual
Period (or on such earlier date as shall be required by law); provided that, in
the case of (a), from and after the date, if any, upon which the interest rate
applicable to the Outstanding Principal Indebtedness shall be converted to the
Base Rate as aforesaid, the Borrower shall no longer be required to pay
Increased Costs that are attributable to the Regulatory Change that gave rise to
the Lenders' right so to convent such interest rate.
ARTICLE III.
CONDITIONS PRECEDENT
Section 3.1. Conditions Precedent to the Lenders' and the
Agents' Obligation to Execute and Deliver this Agreement and the Lenders'
obligation to Make the Loan. The Lenders' and the Agents' obligation to execute
and deliver this Agreement and, in the case of the Lenders, to fund the Loan is
subject to the satisfaction, in accordance with the terms thereof, prior to or
concurrently with the Lenders' and the Agents' execution and delivery of this
Agreement and the making by the Lenders of the Loan, of all conditions and
requirements set forth in the Loan Commitment Letter (including, without
limitation, Exhibits A and B thereto). Borrower hereby acknowledges and agrees
that notwithstanding the execution and delivery by GSMC of that certain Take Out
Lender/Construction Lender Agreement dated as of November 12, 1999 between Mall
Construction Lender and GSMC (acknowledged and agreed to by LVSI, Venetian, Mall
Construction, Grand Canal and Principal)(the "Take Out Lender/Construction
Lender Agreement"), and notwithstanding the fact that the Lenders may fund the
Loan while one or more Default(s) or Event(s) of Default exist (including,
without limitation, any Default(s) or Event(s) of Default under Section 7.1(xix)
hereof relating to the Construction Litigation (as defined in the Take Out
Lender/Construction Lender Agreement) and regardless of whether such Default(s)
or Event(s) of Default shall be known to any Lender or Agent at the time of such
funding), neither such execution and delivery nor such funding shall constitute
a waiver of such Default(s) or Event(s) of Default, and, at any time after
funding the Loan during which any Default or Event of Default shall exist, the
Lenders and Agents shall be entitled to exercise any and all rights and remedies
afforded the Agents and Lenders under the Loan Documents, at law or in equity
(subject to the provisions of Section 9.5 hereof). From and after the funding of
the Loan hereunder, neither GSMC nor any other party thereto nor any other party
hereto shall have (or be deemed to have) any further obligations under the Loan
Commitment Letter, as amended, supplemented or otherwise modified, or the
Tri-Party Agreement (as defined in the Loan Commitment Letter), as amended,
supplemented or otherwise modified, except to the extent that any of the
obligations of Borrower or any Affiliate of Borrower under the Loan Commitment
Letter and/or the Tri-Party Agreement by their terms survive the expiration of
the Loan Commitment Letter or the Tri-Party Agreement, as amended, supplemented
or otherwise modified.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES
Section 4.1. Representations and Warranties. The Borrower
------------------------------
represents and warrants to the Agents and to the Lenders that:
(A) Organization. The sole member of Borrower is Grand Canal and the sole member
of Grand Canal is Mall Holdings. Immediately after the funding of the Loan (but
on the Closing Date) (i) Managing Member will be admitted as the managing member
of Borrower with the result that Managing Member will hold a 1% managing member
membership interest in Borrower, and Grand Canal will hold a 99% non-managing
member membership interest in Borrower and (ii) Grand Canal Shops Mall MM, Inc.
("MM Inc.") will be admitted as the managing member of Grand Canal with the
result that MM Inc. will hold a 1% managing member membership interest in Grand
Canal, and Mall Holdings will hold a 99% non-managing member membership interest
in Grand Canal. (i) Each of Borrower, Grand Canal and Mall Holdings is a duly
organized and validly existing Delaware limited liability company in good
standing under the laws of the State of Delaware, (ii) each of Borrower, Grand
Canal and Mall Holdings has the requisite power and authority to own its
properties (including, in the case of Borrower, the Trust Property) and to carry
on its business as now being conducted (and as contemplated to be conducted) and
is qualified to do business in the jurisdiction in which the Trust Property is
located, and (iii) Borrower has the requisite power and authority to execute and
deliver, and perform its obligations under, this Agreement, the Notes, the Deed
of Trust and all of the other Loan Documents to which it is a party. Each of
Managing Member and MM Inc. (x) is a duly organized and validly existing Nevada
corporation in good standing under the laws of the State of Nevada, (y) has the
requisite power and authority to own its properties and to carry on its business
as now being conducted and is qualified to do business in the jurisdiction in
which the Trust Property is located, and (z) in the case of Managing Member, has
the requisite power and authority to perform, on behalf of Borrower, Borrower's
obligations under, this Agreement, the Notes, the Deed of Trust and all of the
other Loan Documents to which Borrower is a party.
(B) Authorization, No Conflict; Consents and Approvals. The execution and
delivery by Borrower of this Agreement, the Notes, the Deed of Trust and each of
the other Loan Documents to which Borrower is a party, Borrower's performance of
its obligations hereunder and thereunder and the creation of the security
interests and Liens provided for in this Agreement and the other Loan Documents
to which Borrower is a party (i) are within the powers of the Borrower and have
been duly authorized by all requisite action on the part of the Borrower and on
the part of each Member (and no approval or action of Member is required to
authorize any such execution, delivery, performance or creation other than as
have been obtained), (ii) shall not violate any provision of any Legal
Requirements, any order of any court or other Governmental Authority, the
certificate of formation or the limited liability company agreement of the
Borrower or the organizational documents of any Member, or any indenture,
contract, agreement or other instrument to which the Borrower, or any Member is
a party or by which the Borrower, any Member, or the Trust Property or any other
property, assets or revenues of the Borrower, or any Member is bound, and (iii)
shall not be in conflict with, result in an acceleration or a breach of, or
constitute (with due notice or lapse of time or both) a default under, or result
in the creation or imposition of any Lien of any nature whatsoever (other than
those in favor of the Collateral Agent as provided in the Loan Documents) upon
any of the property or assets of the Borrower, or any Member pursuant to, any
such indenture, contract, material agreement or instrument. Other than those
obtained or filed on or prior to the Closing Date copies of which have been
furnished to the Syndication Agent, the Borrower and any Member are not required
to obtain any consent, approval or authorization from, or to file any
declaration or statement with, any Governmental Authority or other agency or any
other Person in connection with or as a condition to the execution, delivery or
performance of this Agreement, the Notes, the Deed of Trust or the other Loan
Documents to which the Borrower is a party.
(C) Enforceability. Each of this Agreement, each Note, the Deed of Trust and
each other Loan Document to which the Borrower is a party is the legal, valid
and binding obligation of Borrower, enforceable against Borrower in accordance
with its terms, subject to bankruptcy, insolvency and other limitations on
creditors' rights generally and to equitable principles. This Agreement, each
Note, the Deed of Trust and such other Loan Documents are not, at each time this
representation and warranty is being made or remade (or deemed made or remade)
subject to any right of rescission, set-off, counterclaim or defense by the
Borrower (including the defense of usury).
(D) Litigation. There are no actions, suits or proceedings at law or in equity
by or before any Governmental Authority or other agency now pending and served
or, to the best knowledge of Borrower, threatened against it, Grand Canal,
Managing Member or the Collateral which are not fully covered (other than the
deductible in the amount permitted under this Agreement) by insurance of the
Borrower, Grand Canal or Managing Member, as applicable, that is currently in
effect (and with respect to which the applicable insurers have acknowledged the
same) or which if determined adversely to the Borrower or such member, as
applicable, might reasonably be expected to cause a Material Adverse Effect.
(E) Agreements. Neither Borrower nor Grand Canal is in violation of its
certificate of formation or limited liability company agreement, is in monetary
or material non-monetary default in the performance, observance or fulfillment
of any of the obligations, covenants or conditions contained in any agreement or
instrument to which it is a party or by which it or its property is bound, or is
in violation, in any material respect, of any Legal Requirement applicable to
the Borrower, Grand Canal or any property of either. Managing Member is not in
violation of its articles of incorporation or by-laws, in monetary or material
non-monetary default in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any agreement or instrument to
which it is a party or by which it or its property is bound, or is in violation,
in any material respect, of any Legal Requirement applicable to Managing Member
or its property. Neither the Borrower nor Managing Member nor any member in the
Borrower is a party to any agreement or instrument or subject to any restriction
which might reasonably be expected to cause a Material Adverse Effect.
(F) Title to the Trust Property. Borrower owns (i) good, marketable and
insurable fee simple title to the Mall Space and to the Retail Annex Land, free
and clear of all Liens, other than the Permitted Encumbrances, (ii) good,
marketable and insurable fee simple title to the Mall Improvements, free and
clear of all Liens, other than the Permitted Encumbrances, (iii) pursuant to the
Billboard Master Lease, a good and valid leasehold estate in the Billboard
Additional Premises, free and clear of all Liens, other than the Permitted
Encumbrances, (iv) pursuant to the Canyon Ranch Master Lease, a good and valid
leasehold estate in the Canyon Ranch Additional Premises, free and clear of all
Liens, other than the Permitted Encumbrances, (v) pursuant to the Lutece Master
Lease, a good and valid leasehold estate in the Lutece Additional Premises, free
and clear of all Liens, other than the Permitted Encumbrances and (vi) owns good
and valid title to the rest of the Collateral, free and clear of all Liens,
other than the Permitted Encumbrances. The Borrower has the right, power and
authority to grant, bargain, sell, alienate, enfeoff, convey, confirm, warrant,
pledge, assign and hypothecate, with power of sale, the Collateral. There are no
outstanding options to purchase or rights of first refusal or restrictions on
transferability affecting the Collateral. The Collateral comprises (i) all real
property and personal property (both tangible and intangible) that will be
necessary to operate the "Grand Canal Shops Mall" as a First Class Mall and (ii)
all real property and personal property (both tangible and intangible) that is
the subject of the Appraisal.
(G) No Bankruptcy Filing. Neither the Borrower nor the Principal nor the
Managing Member nor any other direct or indirect member of the Borrower or the
Managing Member has filed, and neither the Borrower nor the Managing Member nor
the Principal nor any such member is contemplating either the filing of, a
petition by it under any state or federal bankruptcy, insolvency or similar laws
or the liquidation of all or a major portion of its assets or property. Neither
the Borrower nor the Managing Member nor the Principal nor any such member has
any knowledge of any filing, or any Person contemplating the filing, of any such
petition against it.
(H) Solvency. Giving effect to the transactions contemplated hereby, the fair
salable value of the Borrower's assets exceeds and shall, immediately following
the making of the Loan, exceed its total liabilities (including, without
limitation, subordinated, unliquidated, disputed and contingent liabilities).
The fair salable value of the Borrower's assets is and shall, immediately
following the making of the Loan, be greater than Borrower's probable
liabilities (including the maximum amount of its contingent liabilities on its
debts as such debts become absolute and matured). The Borrower's assets do not
and, immediately following the making of the Loan shall not, constitute
unreasonably small capital to carry out its business as conducted or as proposed
to be conducted. The Borrower does not intend to, and does not believe that it
shall, incur debts and liabilities (including, without limitation, Contingent
Obligations and other commitments) beyond its ability to pay such debts as they
mature (taking into account the timing and amounts to be payable on or in
respect of its obligations). None of the transactions contemplated hereby will
be or have been made with an intent to hinder, delay or defraud any present or
future creditors of the Borrower and the Borrower has received reasonably
equivalent value in exchange for its obligations under the Loan Documents.
(I) Other Debt. Except for the debt permitted under Section 6.1(C), and the
Loan, the Borrower has not borrowed or received other debt financing whether
unsecured or secured by the Collateral or any part thereof, nor does the
Borrower have any Other Borrowings, which, in either case, are presently
outstanding or are Contingent Obligations.
(J) Full and Accurate Disclosure. No statement of fact made by or on behalf of
the Borrower in this Agreement or any of the other Loan Documents or in any
certificate, document or schedule furnished by the Borrower to any Agent or to
any Lender pursuant hereto or thereto contains any untrue statement of a
material fact or omits to state any material fact relating specifically to the
Loan, the Collateral, the Borrower or the business operated (or to be operated)
at the Trust Property, that is known to Borrower or any Affiliate thereof and is
necessary to make statements contained herein or therein not misleading. There
is no event or circumstance relating specifically to the Loan, the Collateral,
the Borrower and/or the business operated (or to be operated) at the Trust
Property presently known to the Borrower which has not been disclosed to the
Syndication Agent which might reasonably be expected to cause a Material Adverse
Effect. The representations and warranties contained in this subsection 4.1(J)
are hereinafter collectively referred to as the "Subsection 4.1(J)
Representation and Warranty".
(K) Financial Information. All financial data, if any, concerning the Borrower,
the Trust Property or the remainder of the Real Property that has been delivered
in writing by, or on behalf of, the Borrower to any Agent or to any Lender (i)
is true, complete and correct in all material respects, (ii) accurately
represents the financial condition and results of operations of the Persons
covered thereby as of the date on which the same shall have been furnished, and
(iii) (other than with respect to financial projections), has been prepared in
accordance with GAAP throughout the periods covered. The Borrower does not have
any material contingent liability, material liability for taxes or other
material unusual or forward commitment not reflected in such financial data. The
Borrower has not incurred any obligation or liability, contingent or otherwise,
not reflected in such financial data which might materially adversely affect its
business operations or the Trust Property.
(L) Investment Company Act; Public Utility Holding Company Act. The Borrower is
not (i) an "investment company" or a company "controlled" by an "investment
company," within the meaning of the Investment Company Act of 1940, as amended,
(ii) a "holding company" or a "subsidiary company" of a "holding company" or an
"affiliate" of either a "holding company" or a "subsidiary company" within the
meaning of the Public Utility Holding Company Act of 1935, as amended, or (iii)
subject to any other federal or state law or regulation which purports to
restrict or regulate its ability to borrow money.
(M) Compliance. Except to the extent otherwise disclosed on Schedule B
("Environmental Matters Schedule") attached hereto (i) neither the Borrower nor
any Affiliate thereof has received any notice that the Borrower, the Trust
Property or the Common Facilities is in violation of the Americans with
Disabilities Act and, in the Borrower's commercially reasonable judgment, the
Trust Property, the Common Facilities and the Borrower's use thereof and
operations thereat comply with the Americans with Disabilities Act and (ii) the
Borrower, the Trust Property, the Common Facilities and the Borrower's use
thereof and operations thereat comply, in all material respects, with all other
applicable Legal Requirements (including, without limitation, Environmental
Laws, ERISA, and building and zoning ordinances and codes) and all applicable
Insurance Requirements. The Borrower is not in default or violation, in any
material respect, of any order, writ, injunction, decree or demand of any
Governmental Authority. No portion of the Real Property has been or will be
purchased, improved, fixtured, equipped or furnished with proceeds of any
illegal activity conducted by Borrower, the Principal or any Affiliate of
either.
(N) Condemnation. No Taking has been commenced or, to the Borrower's knowledge,
except as described on Schedule I attached hereto, is contemplated with respect
to all or any portion of the Real Property or for the relocation of roadways
providing access to the Real Property.
(O) Use of Proceeds; Margin Regulations. It shall use the proceeds of the Loan
for the purposes described in Section 2.2. No part of the proceeds of the Loan
shall be used for the purpose of purchasing or acquiring any "margin stock"
within the meaning of Regulations G, T, U or X of the Board of Governors of the
Federal Reserve System or for any other purpose which would be inconsistent with
such Regulations G, T, U or X or any other Regulations of such Board of
Governors, or for any purposes prohibited by Legal Requirements or by the terms
and conditions of the Loan Documents.
(P) Utilities and Access. The Trust Property has legal access to, and is served
by, fire and police protection, parking and water, gas, electric, sewer,
sanitary sewer, storm drain and other facilities and utilities, in each case, as
is necessary to the use and enjoyment of the Trust Property as a First Class
Mall and in order to comply, in all material respects, with all applicable Legal
Requirements (including, without limitation, those pertaining to zoning and land
use). All utilities and services necessary to the use and enjoyment of the Trust
Property as a First Class Mall and in compliance, in all material respects, with
all applicable Legal Requirements (including, without limitation, those
pertaining to zoning and land use), are located in the public right-of-way (or
on private property over which there exists an irrevocable easement in favor of
Borrower pursuant to the REA) abutting the Real Property, and all such utilities
are connected so as to serve the Trust Property without passing over other
property (other than property over which there exists an irrevocable easements
in favor of Borrower pursuant to the REA). All roads and ways necessary to the
use and enjoyment of the Trust Property as a First Class Mall and in order to
comply, in all material respects, with all applicable Legal Requirements
(including, without limitation, those pertaining to zoning and land use) have
been completed and dedicated to public use and accepted by all Governmental
Authorities (or are private roads and ways over which there exists an
irrevocable easement in favor of Borrower pursuant to the REA) and the Trust
Property has direct legal access to all such roads and ways (or legal access to
such roads and ways via irrevocable and perpetual easements over property in
favor of Borrower pursuant to the REA.
(Q) Subdivision. The Mall Space, the Mall Improvements, and the Retail Annex
Land collectively constitute one or more legal parcel(s) and one or more tax
parcel(s) that do not include, or comprise a portion of, any other property.
(R) Environmental Compliance. Except for matters set forth in the
------------------------
Environmental Matters Schedule:
(i) Borrower, the Trust Property and the Common Facilities
are, and the same are used, in compliance, in all material respects,
with all applicable Environmental Laws and Borrower (or, in the case of
Common Facilities that are not located on the Trust Property, the
applicable REA Owner) has obtained all permits required under
applicable Environmental Law, such permits are in full force and effect
and Borrower or such REA Owner, as applicable, is in compliance with
all such permits.
(ii) There is no past non-compliance, in any material respect
(by the Borrower, any Affiliate of Borrower or, to the best of
Borrower's knowledge, any other Person that was a prior owner or
operator of any portion of the Trust Property or any Common Facilities)
with Environmental Laws, or with permits issued pursuant thereto, in
connection with the Trust Property or any Common Facilities. Without
limiting the foregoing, neither the Borrower nor any Affiliate of the
Borrower has, and, to the best knowledge of the Borrower after due
inquiry and investigation, no other Person has at any time Used or
Released any Hazardous Substance on, under, to or from the Trust
Property or any Common Facilities, except such Use as is in the
ordinary course of operation of the Trust Property or any Common
Facilities as presently (i.e., on or about the date hereof) operated
and in material compliance with all Environmental Laws and such Release
as will not require investigation or remediation or otherwise give rise
to material liability pursuant to any applicable Environmental Law.
Neither the Borrower nor any Affiliate of the Borrower has been
requested or required by any Governmental Authority to perform any
material Remedial Work or other responsive action at the Trust Property
or any Common Facilities in connection with any Environmental Claim.
Neither the Trust Property nor any Common Facilities is included or, to
the knowledge of the Borrower, proposed for inclusion on the National
Priorities List issued by the United States Environmental Protection
Agency, nor has the Trust Property nor any Common Facilities been
included or, to the knowledge of the Borrower, proposed for inclusion
on any list or inventory issued pursuant to any Environmental Law.
(iii) There is no material Environmental Claim pending or, to
the best knowledge of the Borrower, threatened, and no penalties
arising under Environmental Laws have been assessed, against the
Borrower, or any Affiliate of the Borrower, or to the best knowledge of
the Borrower (after due inquiry and investigation), any tenant,
subtenant, licensee or sublicensee of the Trust Property or any Common
Facilities or, to the best knowledge of the Borrower, against any
Person whose liability for any Environmental Claim the Borrower has or
may have retained or assumed either contractually or by operation of
law, and no material investigation or review is pending or, to the best
knowledge of the Borrower, threatened by any Governmental Authority,
citizens group, employee or other Person with respect to any alleged
failure by the Borrower, any Affiliate of the Borrower or any tenant,
licensee or sublicensee of the Trust Property or any of the Common
Facilities to have any environmental, health or safety permit, license
or other authorization required under, or to otherwise comply with, any
Environmental Law or with respect to any alleged liability of Borrower
or any Affiliate of the Borrower for any Use or Release of any
Hazardous Substances.
(iv) There have been and are no past or present Releases by
Borrower or any Affiliate of Borrower or, to the best of Borrower's
knowledge, any other Person, of any Hazardous Substance in a condition
which requires investigation or remediation or which would otherwise
give rise to material liability pursuant to any applicable
Environmental Law, and no Hazardous Substance exists due to the acts of
Borrower or any Affiliate of Borrower, or to the best of Borrower's
knowledge, any other Person, in, on or under the Trust Property or any
Common Facilities, except in compliance, in all material respects, with
Environmental Laws.
(v) Without limiting the generality of the foregoing, there is
not present at, on, in or under the Trust Property or any Common
Facilities, PCB-containing equipment, asbestos or asbestos containing
materials, insulating material containing urea formaldehyde, (to the
best of Borrower's knowledge) underground treatment or storage tanks or
pumps or surface impoundments for Hazardous Substances, lead in
drinking water (except in concentrations that comply with all
Environmental Laws), or lead-based paint, except as (x) would not give
rise to material liability pursuant to any applicable Environmental Law
and (y) which will not cause a Material Adverse Effect.
(vi) No Liens are presently recorded with the appropriate land
records under or pursuant to any Environmental Law with respect to the
Trust Property or any Common Facilities and, to the Borrower's
knowledge, no Governmental Authority has been taking or is in the
process of taking any action that could subject the Trust Property or
any Common Facilities to Liens under any Environmental Law
("Environmental Liens").
(vii) Borrower has furnished to the Syndication Agent all
environmental investigations, studies, audits, reviews or other
analyses prepared within the past ten (10) years, conducted by or that
are in the possession of the Borrower or any Affiliate of Borrower in
relation to the Real Property which the Borrower, exercising reasonable
diligence, has been able to locate.
(viii) The Borrower has not waived any Person's liability with
respect to any Hazardous Substances in, on, under or around the Trust
Property or any Common Facilities.
(R) Single-Purpose Entity.
---------------------
(a)(i) Each of the Borrower, and the Managing Member is, as of
the date hereof, a Single Purpose Entity.
(ii) Neither the Borrower nor Managing Member (A) owns any
asset other than (x) in the case of Borrower, the Trust Property and
(y) in the case of Managing Member, its membership interest in
Borrower, (B) is engaged in any business other than Permitted
Activities, (C) is a party to any contract, agreement or transaction
with any direct or indirect member of the Borrower, with any Affiliate
of the Borrower or with any Affiliate of any such member except upon
terms and conditions that are intrinsically fair and substantially
similar to those that would be available on an arm's-length basis with
third parties other than an Affiliate, (D) has incurred any debt,
secured or unsecured, direct or contingent (including guaranteeing any
obligation) that is, in any case, presently outstanding or is a
Contingent Obligation (other than, in the case of Borrower, the Loan
and the debt described in Section 6.1(C)), and (E) has made any loans
or advances to any Person (including any Affiliate).
(iii) Except for any indemnification expressly set forth in
the organizational documents of Borrower and/or the Managing member,
neither Borrower nor Managing Member has, at any time since its
formation, assumed or guaranteed the liabilities of any of its direct
or indirect members or shareholders, any Affiliates of such members or
shareholders, or any other Persons other than liabilities that are not
presently outstanding and are not Contingent Obligations. Neither
Borrower nor Managing Member has, at any time since its formation,
acquired obligations or securities of its direct or indirect members or
shareholders (or any predecessor entity), or any Affiliates of such
members or shareholders. Neither Borrower nor Managing Member has, at
any time since its formation, made loans to its direct or indirect
members or shareholders (or any predecessor), or any Affiliates of such
members or shareholders that are presently outstanding.
(iv) The Borrower does not own any stock, membership
interests, partnership interests or other securities or interests of
any other Person. Managing Member does not own any stock, membership
interests, partnership interests or other securities or interests of
any other Person (other than its membership interest in Borrower).
(S) Deed of Trust and Other Liens; Concession Income. The Deed of Trust creates
a valid and enforceable first priority Lien on the Trust Property as security
for the repayment of the Indebtedness, subject only to the Permitted Liens. Each
Collateral Security Instrument establishes and creates a valid, subsisting and
enforceable Lien on and a security interest in, or claim to, the rights and
property described therein. All property covered by any Collateral Security
Instrument on which a Lien is capable of being perfected by the filing of a UCC
financing statement is subject to a UCC financing statement filed and/or
recorded, as appropriate (or irrevocably delivered to an agent for such
recordation or filing) in all places necessary to perfect a valid first priority
Lien with respect to the rights and property that are the subject of such
Collateral Security Instrument to the extent governed by the UCC. All Concession
Income is solely the property of Borrower and neither any Affiliate of Borrower
nor any other Person has any right, title or interest in, or any claim to, any
Concession Income. The Collateral includes all personal property necessary or
desirable to operate the Gondola Concession (as such capitalized term is defined
in the definition of Concession Income).
(T) Assessments. Except to the extent the same shall constitute Permitted
Encumbrances, there are no pending or, to the best knowledge of the Borrower,
proposed special or other assessments for public improvements or otherwise
affecting the Trust Property and/or the Common Facilities.
(U) No Joint Assessment; Separate Lots. Borrower has not suffered, permitted or
initiated the joint assessment of the Trust Property (i) with any other real
property constituting a separate tax parcel, and (ii) with any portion of the
Trust Property which may be deemed to constitute personal property, or any other
procedure whereby the Lien of any Taxes which may be levied or assessed or
charged against such personal property shall be assessed or levied or charged to
the Trust Property as a single Lien. The Trust Property does not benefit from
any tax abatement or exemption.
(V) No Prior Assignment. The Collateral Agent, for the benefit of the Lenders,
is the assignee of the Borrower's interest under the Leases. There are no prior
assignments of the Leases or any portion of the Rent due and payable or to
become due and payable which are presently outstanding.
(W) Permits. Borrower has obtained all Permits necessary to the use and
operation of the Collateral as a First Class Mall on the date hereof, and all of
such Permits are current and in full force and effect. Borrower is not in
violation, in any material respect, of any Permits pertaining to the Collateral
and Borrower is in compliance, in all material respects, with all Legal
Requirements and Insurance Requirements affecting the Collateral and with all
Leases affecting the Trust Property. The Borrower has not received any notice
from any Governmental Authority or other Person alleging any uncured material
violation of any Legal Requirement or Insurance Requirement relating to the
Collateral (including with respect to zoning).
(X) Flood Zone. The Trust Property is not located in a flood hazard area as
defined by the Federal Insurance Administration or in a 100-year flood plain
identified by the Secretary of Housing and Urban Development or any other
Governmental Authority.
(Y) Physical Condition. Except as expressly permitted under Section 3.AA of
Exhibit B to the Loan Commitment Letter, the Trust Property and the Common
Facilities are free of damage and destruction from casualty that has not been
repaired and from structural defects and all building systems contained therein
are in good working order subject to ordinary wear and tear.
(Z) Security Deposits. The Borrower is in compliance with all Legal
-----------------
Requirements relating to all security deposits with respect to the Trust
Property.
(AA) No Defaults. No Default or Event of Default exists and no Default or Event
of Default shall occur as a result of the consummation of the transactions
contemplated by the Loan Documents.
(BB) Intellectual Property. Other than the intents to use the trademarks/service
marks "THE GRAND CANAL" and "GRAND CANAL SHOPPES" and the intellectual property
described on Exhibit R hereto (collectively, the "Enumerated IP Rights"), there
is no right under any trademark, trade name, service mark or other intellectual
property necessary to the business of the Borrower as a First Class Mall or as
the Borrower contemplates conducting its business. The Borrower owns, and has
not licensed out, the Enumerated IP Rights and the Borrower has not infringed,
is not infringing, and has not received notice of infringement with respect to
asserted trademarks, trade names, service marks and other intellectual property
of others.
(CC) No Encroachments. All of the Improvements which were included in
determining the appraised value of the Trust Property as set forth in the
Appraisal lie wholly within the boundaries and building restriction lines of the
Mall Space, the Retail Annex Land, the Billboard Additional Premises, the Lutece
Additional Premises and the Canyon Ranch Additional Premises (or there are
appropriate easements for the same pursuant to the REA). No improvements on
adjoining properties encroach upon the Trust Property (except as otherwise
expressly set forth in the REA).
(DD) Plans and Welfare Plans. The assets of the Borrower are not treated as
"plan assets" under final regulations currently promulgated, as of the date of
this Agreement, under ERISA. Each Plan, Welfare Plan, and, to the best knowledge
of the Borrower, each Multiemployer Plan, is in compliance in all material
respects with, and has been administered in all material respects in compliance
with, its terms and the applicable provisions of ERISA, the Code and any other
applicable Legal Requirement, and no event or condition has occurred and is
continuing as to which the Borrower would be under an obligation to furnish, but
has not furnished, a report to the Syndication Agent under Section 5.1(V). There
are no pending issues or claims before the Internal Revenue Service, the United
States Department of Labor or any court of competent jurisdiction related to any
Plan or Welfare Plan that could reasonably be expected to have a Material
Adverse Effect. No event has occurred, and there exists no condition or set of
circumstances, in connection with any Plan or Welfare Plan under which the
Borrower or any ERISA Affiliate, directly or indirectly (through an
indemnification agreement or otherwise), could reasonably be expected to be
subject to any material liability under Section 409 or 502(i) of ERISA or
Section 4975 of the Code. Except to the extent that the same would not
reasonably be expected to result in a Material Adverse Effect, no Welfare Plan
provides benefits (including, without limitation, death or medical benefits)
(whether or not insured) with respect to any current or former employee of the
Borrower, or any ERISA Affiliate beyond his or her retirement or other
termination of service other than (i) coverage mandated by applicable law, (ii)
death or disability benefits that have been fully provided for by fully paid up
insurance or (iii) severance benefits. No Plan has any Unfunded Benefit
Liabilities which, if paid, would reasonably be expected to result in a Material
Adverse Effect.
(EE) Location of Chief Executive Offices. The location of the Borrower's
principal place of business and chief executive office is 3355 Las Vegas
Boulevard South, Las Vegas, Nevada 89101 (or such other location in Clark
County, Nevada as to which Borrower shall have given the Administrative Agent at
least thirty (30) days prior written notice).
(FF) Not Foreign Person. The Borrower is not a "foreign person" within the
------------------
meaning ofss. 1445(f)(3) of the Code.
(GG) Labor Matters. The Borrower is not a party to any collective bargaining
agreements. There are no controversies or unfair labor practice proceedings
pending or, to the Borrower's knowledge, threatened between the Borrower and any
of its current or former employees or any labor or other collective bargaining
unit representing any current or former employee of the Borrower that could
reasonably be expected to result in a labor strike, dispute, slow-down or work
stoppage or otherwise that, in each such case, could reasonably be expected to
have a Material Adverse Effect.
(HH) Leases. The Trust Property is not subject to any Leases other than the
Leases described in the rent roll (the "Closing Date Rent Roll") delivered to
Syndication Agent to satisfy a condition precedent to the Syndication Agent's
obligation to execute and deliver this Agreement, and the Lenders' obligation to
fund the Loan (collectively, the "Existing Leases"), as to which Borrower
executed a written certification. The Borrower has delivered to the Syndication
Agent true, correct and complete copies of all Existing Leases (including any
amendments, supplements, modifications and assignments related thereto)
described in said Closing Date Rent Roll and each Existing Lease is a Permitted
Lease. No Person has any possessory interest in the Trust Property or right to
occupy the same except under and pursuant to the provisions of the Existing
Leases. Except as set forth on Exhibit I hereto, each Existing Lease is in full
force and effect, constitutes the legal, valid and binding obligation of the
Borrower enforceable against the Borrower in accordance with its terms (subject
to bankruptcy, insolvency and other limitations on creditors' rights generally
and to equitable principles), and, to the knowledge of the Borrower, each such
Lease constitutes the legal, valid and binding obligation of the tenant
thereunder and is enforceable against such tenant in accordance with its terms
(subject to bankruptcy, insolvency and other limitations on creditors' rights
generally and to equitable principles). There is no monetary or material
non-monetary default under any such Existing Lease by the Borrower (and no
conditions which with the passage of time and/or notice would constitute such a
default by the Borrower thereunder), and, to the best knowledge of the Borrower,
except as set forth on Exhibit I, there is no monetary or material non-monetary
default thereunder by any other party (and no condition which with the passage
of time and/or notice would constitute such a default by any other party
thereunder). No tenant under any such Existing Lease has, as of the date hereof,
paid Rent more than 30 days in advance (except to the extent otherwise permitted
under the express terms of such Existing Lease), and the Rents under such
Existing Lease have not been waived, released, or otherwise discharged or
compromised. To the best of the Borrower's knowledge, except as set forth on
Exhibit I, no tenant under any such Existing Lease is the subject of any
bankruptcy, arrangement, insolvency, reorganization or other similar action,
case or proceeding and no such tenant has made a general assignment for the
benefit of creditors. No Existing Lease provides any party with the right to
obtain a Lien upon the Trust Property. With respect to each Existing Lease that
is not a Subordinate Lease, all work heretofore required to be performed by the
Borrower under such Existing Lease has been performed, in all material respects,
and all contributions which are due and payable to be made by the Borrower to
the tenant thereunder have been made.
(II) Pre-Closing Date Activities. The Borrower has not conducted any business or
other activity on or prior to the Closing Date, other than in connection with
the acquisition, development, operation and ownership of the Trust Property. The
Managing Member has not conducted any business or other activity on or prior to
the Closing Date, other than in connection with the acquisition and ownership of
its membership interest in Borrower.
(JJ) Tax Filings. The Borrower has filed all material federal, state and local
tax returns required to be filed and has paid all federal, state and local
taxes, charges and assessments payable by the Borrower. The Borrower's tax
returns properly reflect the income and taxes of the Borrower for the periods
covered thereby.
(KK) Impositions. All Impositions due and owing in respect of, or otherwise
affecting, the Trust Property and/or the Common Facilities have been paid
(except to the extent that the Borrower shall be contesting the same in
accordance with the provisions of the Loan Documents and, to the extent
applicable, of the REA).
(LL) Insurance. The Trust Property is insured in accordance with the
requirements set forth in the Loan Documents.
(MM) Property Agreements. The Borrower has delivered to the Syndication Agent
true, correct and complete copies of the Management Agreement, the Brokerage
Agreement, the ESA, the REA, the Sale and Contribution Agreement, the COREA (if
entered into), the Trademark Cross License Agreement, the FADAA, the Mall
Retainage Escrow Agreement and all other material Property Agreements in effect
on the date hereof. No monetary default and no material non-monetary default
exists, or with the passing of time or the giving of notice or both, would exist
under any Property Agreement (x) on the part of Borrower or (y) to the best
knowledge of Borrower, any other Person (unless, in the case of a default by any
party other than Borrower, such default is a default that (x) a Commercially
Reasonable Owner would irrevocably waive and (y) is not reasonably likely to
result in a Material Adverse Effect). No party to any Property Agreement (other
than a Service Contract) has given or received any written notice or claim of
monetary or material non-monetary default under such Property Agreement which
has not been cured (other than notices or claims of default given and addressed
to a party other than Borrower relating to defaults that (x) a Commercially
Reasonable Owner would waive and (y) are not reasonably likely to result in a
Material Adverse Effect). No condition exists whereby the Borrower or any future
owner of the Collateral may be required to purchase any other parcel of land
which is subject to any Property Agreement or which gives any Person a right to
purchase, right of reversion, a right of first refusal, right of first offer or
another similar right or interest in or with respect to, the Collateral. No
material exclusions or restrictions on the utilization, leasing or improvement
of the Collateral (including non-compete agreements) exist in any Property
Agreement (other than those set forth in the REAs and the Permitted
Encumbrances). The Administrative Agent hereby approves the Trademark Cross
License Agreement.
(NN) Personal Property. Schedule A attached hereto is a true, correct and
complete schedule of all categories of all tangible personal property, if any,
owned by the Borrower and located upon the Trust Property or used in connection
with the use and operation of the Collateral. The Borrower has good and
marketable title to all such personal property, free and clear of all Liens
except for Liens created under the Loan Documents or permitted under the terms
of this Agreement.
(OO) Plans and Specifications. No Scope Changes (as defined in the FADAA) to the
Existing Plans and Specifications (as defined in the Loan Commitment Letter)
have been made other than Scope Changes to the Existing Plans and Specifications
that constitute Safe Harbor Scope Changes (as defined in the FADAA) and/or which
do not, under Section 6.2.1 of the FADAA, require the Required Scope Change
Approval (as defined in the FADAA).
Section 4.2. Survival of Representations. The Borrower agrees
that all of the representations and warranties of the Borrower set forth in
Section 4.1 and elsewhere in this Agreement and in the other Loan Documents
shall survive the delivery of the Notes and making of the Loan.
ARTICLE V.
AFFIRMATIVE COVENANTS
Section 5.1. Affirmative Covenants. The Borrower
---------------------
covenants and agrees that:
(A) Existence; Compliance with Legal Requirements; Insurance. The Borrower shall
do or cause to be done all things necessary to (i) preserve, renew and keep in
full force and effect (a) its existence as a Delaware limited liability company
and (b) all rights and Permits necessary or desirable for the conduct of its
business as a First Class Mall (it being agreed, however, that the foregoing
shall not be construed to prohibit Borrower from changing any trade name,
trademark, service mark or other intellectual property (so long as no Event of
Default shall exist and Borrower shall maintain, preserve and protect such trade
name, trade mark, service mark or other intellectual property, as applicable, as
so changed)) and (ii) comply with all Legal Requirements and Insurance
Requirements applicable to it or the Trust Property. The Borrower shall at all
times maintain, preserve and protect all franchises, trade names, trademarks,
service marks and other intellectual property, if any, and preserve all the
remainder of its property, necessary for the continued conduct of its business
(it being agreed, however, that the foregoing shall not be construed to prohibit
Borrower from changing any trade name, trademark, service mark or other
intellectual property (so long as no Event of Default shall exist and Borrower
shall maintain, preserve and protect such trade name, trade mark, service mark
or other intellectual property, as applicable, as so changed)) and keep the
Trust Property in good repair, working order and condition, except for
reasonable wear and use and damage caused by a casualty or taking with respect
to which the Borrower is effectuating a Restoration (or is causing a Restoration
to be effectuated), or is not required to effectuate, or to cause to be
effectuated, a Restoration, as applicable, in each case, in accordance with the
provisions of the Loan Documents and from time to time the Borrower shall make,
or cause to be made, all repairs, renewals and replacements thereto necessary so
to maintain the Trust Property.
(B) Impositions and Other Claims. Without duplication of amounts payable under
subsection 2.10 hereof, the Borrower shall pay and discharge all Impositions, as
well as all lawful claims for labor, materials and supplies or otherwise, which
could become a Lien, all as more fully provided in, and subject to any rights to
contest contained in, the Loan Documents; provided that Borrower shall not be
deemed to be in Default for its failure to pay those Impositions that (x) prior
to the Assessment Date, the Trustee shall cause to be paid out of Money then on
deposit in the REA Tax Escrow Account or (y) from and after the Assessment Date,
the Collateral Agent shall cause to be paid out of Money then on deposit in the
Tax Escrow Account pursuant to Section 2.12). The Borrower shall pay, or shall
cause to be paid, all Insurance Premiums with respect to the Borrower, the Trust
Property and the Common Facilities in accordance with the provisions of the Loan
Documents and the REA.
(C) Litigation. The Borrower shall give prompt written notice to the
Administrative Agent of any litigation or governmental proceedings pending or,
to the best of Borrower's knowledge, threatened against the Borrower or the
Trust Property and/or the Common Facilities (1) in which the amount involved is
greater than $1,000,000 and that is not fully covered by insurance (excluding
any deductible relating thereto permitted under this Agreement) or (2) that, if
determined adversely to the Borrower, would be reasonably likely to cause a
Material Adverse Effect (regardless of whether damages and/or injunctive or
similar relief is sought and regardless of the amount involved and whether such
matter is covered by insurance). Without limiting any rights or remedies that
the Lenders and Agents have under the Loan Documents in connection with the
Construction Litigation, the Borrower (x) has notified the Administrative Agent
regarding the existence of the Construction Litigation, (y) is diligently
defending (and will continue to diligently defend) the Construction Litigation
and (z) will continue to keep the Administrative Agent apprised as to the status
of the Construction Litigation.
(D) Environmental Remediation.
-------------------------
(i) If any investigation, site monitoring, cleanup, removal,
restoration or other remedial work of any kind or nature is required
pursuant to an order or directive of any Governmental Authority or
under any applicable Environmental Law (collectively, the "Remedial
Work"), because of or in connection with the current or future
presence, suspected presence, Release or suspected Release of a
Hazardous Substance on, under or from the Trust Property or any portion
thereof, the Borrower shall promptly commence and diligently prosecute
to completion (or shall promptly cause to be commenced and diligently
prosecuted to completion) all such Remedial Work, and shall conduct
such Remedial Work in accordance with the National Contingency Plan
promulgated under the Comprehensive Environmental Response,
Compensation and Liability Act, if applicable, and in accordance with
all other applicable Environmental Laws. In all events, such Remedial
Work shall be commenced within thirty (30) Business Days after any
demand therefor by the Administrative Agent or such shorter period as
may be required under any applicable Environmental Law or as may be
necessary to prevent further Release of Hazardous Substances, and shall
be diligently performed to completion in a good and workmanlike manner.
(ii) If requested by the Administrative Agent, all Remedial
Work under clause (i) above shall be performed by contractors, and
under the supervision of a consulting Engineer, each approved in
advance by the Administrative Agent. All costs and expenses incurred in
connection with such Remedial Work shall be paid by the Borrower. If
the Borrower does not promptly commence and diligently prosecute to
completion (or cause to be promptly commenced and diligently prosecuted
to completion) the Remedial Work, the Administrative Agent may (but
shall not be obligated to), upon ten (10) Business Days' prior written
notice to Borrower of its intention to do so, cause such Remedial Work
to be performed. The Borrower shall pay or reimburse the Administrative
Agent on demand for all expenses (including reasonable attorneys' fees
and disbursements) relating to or incurred by the Administrative Agent
in connection with monitoring, reviewing or performing any Remedial
Work.
(iii) The Borrower shall not (A) without obtaining the
Administrative Agent's prior written consent (which consent, if no
Event of Default shall then exist, shall not be unreasonably withheld
or delayed), commence any Remedial Work under clause (i) above or (B)
without obtaining the Administrative Agent's prior written consent
(which consent the Administrative Agent may grant or withhold in its
sole discretion), enter into any settlement agreement, consent decree
or other compromise relating to any Hazardous Substances or
Environmental Laws which might reasonably be expected to cause a
Material Adverse Effect.
(E) Environmental Matters; Inspection.
---------------------------------
(a)(i) The Borrower shall not permit any Release from the
Trust Property, and the Borrower shall not permit any Hazardous
Substance to be present in, on, under or above the Trust Property
(except to the extent such presence (A) is in the ordinary course of
operation of the Trust Property as presently (i.e., on or about the
date hereof) operated and (B) is in compliance with all Environmental
Laws), and, in the event that such Hazardous Substances are present on,
under or emanate from the Trust Property, or migrate onto or into the
Trust Property, the Borrower shall cause the removal or remediation of
such Hazardous Substances, to the extent required by any applicable
Environmental Laws, in accordance with this Agreement and Environmental
Laws (including, where applicable, the National Contingency Plan
promulgated pursuant to the Comprehensive Environmental Response,
Compensation and Liability Act). The Borrower shall use the efforts
that a Commercially Reasonable Owner would use to prevent, and to seek
the remediation of, to the extent required by any applicable
Environmental Laws, any migration of Hazardous Substances onto or into
the Trust Property from any adjoining property.
(ii) Upon reasonable prior written notice, each Agent and each
Lender shall have the right, at all reasonable times, to enter upon and
inspect all or any portion of the Trust Property and/or the Common
Facilities (to the extent permitted under the REA), provided that such
inspections shall not unreasonably interfere with the operation or the
tenants of the Trust Property. If the Administrative Agent has
reasonable grounds to suspect that Remedial Work may be required, the
Administrative Agent shall notify the Borrower and, if Borrower has not
selected an Environmental Auditor acceptable to Lender within ten (10)
days of such notice, may select an Environmental Auditor to conduct and
prepare reports of such inspections. The Borrower shall be given a
reasonable opportunity to review drafts of any reports, data and other
documents or materials reviewed or prepared by the Environmental
Auditor, to submit comments and suggested revisions or rebuttals to
same, and to receive copies of the final versions of the same. If an
Environmental Auditor selected by Borrower conducts such inspections,
Lender shall have the right (x) to review, comment on and approve
(which approval, if no Event of Default shall then exist, shall not be
unreasonably withheld or delayed) any draft reports, (y) to review
copies of any data or other documents or materials reviewed or prepared
by the Environmental Auditor and (z) receive and rely upon final copies
of any reports prepared by the Environmental Auditor. The inspection
rights granted to the Agents and to the Lenders in this Section 5.1(E)
shall be in addition to, and not in limitation of, any other inspection
rights granted to the Agents and to the Lenders in the Loan Documents,
and shall expressly include the right (if the Administrative Agent
reasonably suspects that Remedial Work may be required or if an Event
of Default shall then exist) to conduct soil borings, establish ground
water monitoring wells and conduct other customary environmental tests,
assessments and audits, without, so long as no Event of Default shall
then exist, interfering with Borrower's operations on the Trust
Property, except as may be necessary to comply with any applicable
Environmental Law. The Borrower shall, at its sole cost and expense,
fully and expeditiously cooperate in all activities pursuant to this
clause (ii) of Section 5.1(E), including but not limited to providing
all relevant information and making knowledgeable persons available for
interviews.
(iii) The Borrower agrees to bear and shall pay or reimburse
the Administrative Agent on demand for all sums advanced and expenses
incurred (including reasonable attorneys' fees and disbursements)
relating to, or incurred by Administrative Agent in connection with,
the inspections and reports described in this Section 5.1(E).
(iv) The Borrower shall cause all uses and operations on or of
the Trust Property, whether by the Borrower or any other Person, to be
in compliance with all applicable Environmental Laws.
(v) The Borrower shall keep the Trust Property free and clear
of all Environmental Liens, whether due to the act or omission of the
Borrower or any other Person.
(vi) The Borrower shall, at its sole cost and expense, perform
any environmental site assessment or other investigation of
environmental conditions in connection with the Trust Property and/or
the Common Facilities, pursuant to any reasonable written requests of
the Administrative Agent (including but not limited to sampling,
testing and analysis of soil, water, air, building materials, and other
materials and substances whether solid, liquid or gas) and share with
the Administrative Agent the reports and other results thereof, and the
Agents and the other Indemnified Parties shall be entitled to rely on
such reports and other results thereof.
(F) Environmental Notices. The Borrower shall promptly provide notice to
---------------------
Administrative Agent of:
(b)(i) any Environmental Claim asserted by any Governmental
Authority with respect to any Hazardous Substance on, in, under or
emanating from the Trust Property or the Common Facilities if (A) the
potential loss is alleged to be, or reasonably may be expected to be,
greater than $50,000 and/or (B) such Environmental Claim, or the
circumstances giving rise to it, may reasonably be expected to cause a
Material Adverse Effect;
(ii) any proceeding, investigation or inquiry
commenced or threatened in writing by any Governmental Authority,
against the Borrower, with respect to the presence, suspected presence,
Release or threatened Release of Hazardous Substances from or onto, in
or under any property not owned by Borrower (including, without
limitation, proceedings under the Comprehensive Environmental Response,
Compensation, and Liability Act, as amended, 42 U.S.C. ss. 9601, et
seq.) if (A) the potential loss is alleged to be, or reasonably may be
expected to be, greater than $50,000 and/or (B) such proceeding,
investigation or inquiry, or the circumstances giving rise to it, may
reasonably be expected to cause a Material Adverse Effect;
(iii) all Environmental Claims asserted or threatened
against the Borrower, against any other party occupying the Trust
Property or any portion thereof which become known to the Borrower or
against the Trust Property and/or the Common Facilities which are known
to Borrower or any Affiliate thereof if (A) the potential loss is
alleged to be, or reasonably may be expected to be, greater than
$50,000 and/or (B) such Environmental Claim, or the circumstances
giving rise to it, may reasonably be expected to cause a Material
Adverse Effect;
(iv) the discovery by the Borrower of any presence or
Releases or threatened Releases of Hazardous Substances in, on, above,
under, from or migrating towards the Trust Property and/or the Common
Facilities, unless (A) no reasonable person could conclude that
remediation or investigation at a cost greater than $50,000 could be
required and (B) no reasonable person could conclude that such
presence, Release or threatened Release may reasonably be expected to
cause a Material Adverse Effect;
(v) any material non-compliance with any
Environmental Laws related in any way to the Trust Property and/or the
Common Facilities;
(vi) any actual or potential Environmental Lien
against the Trust Property (or any portion thereof) and/or the Common
Facilities (or any portion thereof) of which the Borrower or any
Affiliate thereof has knowledge;
(vii) any required or proposed Remedial Work relating
to the Trust Property, the Common Facilities or the Borrower unless (A)
no reasonable person could conclude that the cost of such Remedial Work
or proposed Remedial Work could be greater than $50,000 and (B) no
reasonable person could conclude that such Remedial Work or proposed
Remedial Work (or the circumstances giving rise to such Remedial Work
or proposed Remedial Work) may reasonably be expected to cause a
Material Adverse Effect; and
(viii) any other written or oral notice or other communication
of which the Borrower becomes aware from any source whatsoever
(including but not limited to a Governmental Authority) relating in any
way to Remedial Work or possible liability of any Person pursuant to
any applicable Environmental Law, in each case in connection with the
Trust Property and/or the Common Facilities or activities of the
Borrower unless (A) no reasonable person could conclude that the cost
of such Remedial Work or the potential loss arising out of the
circumstances giving rise to such communication, as applicable, could
be greater than $50,000 and (B) no reasonable person could conclude
that such Remedial Work or (or the circumstances giving rise to such
Remedial Work) or the circumstances giving rise to such communication,
as applicable, may reasonably be expected to cause a Material Adverse
Effect.
(G) Copies of Notices. The Borrower shall transmit to the Administrative Agent
copies of any citations, orders, notices or other written communications
received from any Person and any notices, reports or other written
communications submitted to any Governmental Authority with respect to any
proceeding or Environmental Claim described in Section 5.1(F).
(H) Environmental Claims. Any Agent may join and participate in, as a party if
such Agent so determines, any legal or administrative proceeding or action
concerning the Trust Property, the Common Facilities or any portion of either
under any Environmental Law, if, in such Agent's reasonable judgment, the
interests of such Agent or any Lender shall not be adequately protected by the
Borrower. Borrower shall pay or reimburse each Agent on demand for all
reasonable sums advanced and expenses incurred (including reasonable attorneys'
fees and expenses) by such Agent in connection with any such action or
proceeding.
(I) Environmental Indemnification. The Borrower shall indemnify, reimburse,
defend, and hold harmless each Agent and each Lender, each Participant, each
Person who is or will have been involved in originating the Loan, each Person
who is or will have been involved in servicing the Loan, each Person in whose
name the encumbrance created by the Deed of Trust is or will have been recorded,
Persons who may hold or acquire or will have held a full or partial interest in
the Loan (including, without limitation, those who may acquire any interest in
any Securities, as well as custodians, trustees and other fiduciaries who hold
or have held a full or partial interest in the Loan for the benefit of third
parties), as well as the respective directors, officers, members, shareholders,
partners, employees, agents, servants, representatives, contractors,
subcontractors, Affiliates, subsidiaries, participants, successors and assigns
of any and all of the foregoing (including but not limited to any other Person
who holds or acquires or will have held a participation or other full or partial
interest in the Loan, the Loan Documents or the Collateral, whether during the
term of the Loan or as part of or following foreclosure pursuant to the Loan)
and including but not limited to any successors by merger, consolidation or
acquisition of all or a substantial part of any Agent or any Lender's or
Participant's assets and business (collectively, the "Indemnified Parties") for,
from, and against all demands, claims, actions or causes of action, assessments,
losses, damages, liabilities, costs and expenses (including, without limitation,
interest, penalties, reasonable attorneys' fees, disbursements and expenses, and
reasonable consultants' fees, disbursements and expenses), asserted against,
resulting to, imposed on, or incurred by any Indemnified Party, directly or
indirectly, in connection with any of the following (other than those arising
solely (x) from a state of facts that first came into existence after (1) the
Collateral Agent acquired title to the Trust Property for the benefit of the
Lenders through foreclosure or a deed in lieu thereof (or through the exercise
by any Agent or Lender of any other remedy available to it at law or in equity)
and the Borrower relinquished possession of the Trust Property to the Collateral
Agent for the benefit of the Lenders or (2) Borrower relinquished possession of
the Trust Property to the Collateral Agent for the benefit of the Lenders upon
demand therefor by the Collateral Agent on behalf of the Lenders or to a
receiver for the Trust Property pursuant to a court order obtained by the
Collateral Agent on behalf of the Lenders, or (y) from the bad faith, gross
negligence or willful misconduct of the Indemnified Party seeking
indemnification hereunder (without relieving the Indemnitors from liability to
the other Indemnified Parties):
(1) any presence of any Hazardous Substances in, on, above, or under the
Real Property (or any portion thereof);
(2) any past, present or threatened Release of Hazardous Substances in, on,
above, under or from the Real Property (or any
portion thereof);
(3) any activity by the Borrower, the Principal, any Affiliate of the
Borrower and/or of the Principal, or any licensee,
sublicensee, tenant, subtenant or other user of the
Real Property (or any portion thereof) in connection
with any actual, proposed or threatened Use,
treatment, storage, holding, existence, disposition
or other Release, generation, production,
manufacturing, processing, refining, control,
management, abatement, removal, handling, transfer or
transportation to or from the Real Property (or any
portion thereof) of any Hazardous Substances at any
time located in, under, on or above the Real Property
(or any portion thereof);
(4) any activity by the Borrower, the Principal, any Affiliate of the
Borrower and/or of the Principal, or any licensee,
sublicensee, tenant, subtenant or other user of the
Real Property (or any portion thereof) in connection
with any actual or proposed Remedial Work for any
Hazardous Substances at any time located in, under,
on or above the Real Property (or any portion
thereof), whether or not such Remedial Work is
voluntary or pursuant to court or administrative
order (including, but not limited to, any removal,
remedial or corrective action);
(5) any past, present or threatened non-compliance or violations of any
Environmental Laws (or permits issued pursuant to any
Environmental Law) in connection with the Real
Property (or any portion thereof) or operations
thereon (including, but not limited to, any failure
by the Borrower, the Principal, any Affiliate of the
Borrower and/or of the Principal, or any licensee,
sublicensee, tenant, subtenant or other user of the
Real Property (or any portion thereof) to comply with
any order of any Governmental Authority in connection
with any Environmental Laws;
(6) the imposition, recording or filing or the threatened imposition,
recording or filing of any Environmental Lien
encumbering the Real Property (or any portion
thereof);
(7) any administrative processes or proceedings or judicial proceedings in
any way connected with any matter addressed in
Section 5.1(D)-(H) or this Section 5.1(I);
------------------ --------------
(8) any past, present or threatened injury to,
destruction of or loss of natural resources in any
way connected with the Real Property (or any portion
thereof) (including, but not limited to, costs to
investigate and assess such injury, destruction or
loss);
(9) any acts of the Borrower, the Principal, any Affiliate of the Borrower
and/or the Principal, or any licensee, sublicensee,
tenant, subtenant or other user of the Real Property
(or any portion thereof) in arranging for disposal
or treatment, or arranging with a transporter for
transport for disposal or treatment, of Hazardous
Substances at any facility or incineration vessel
containing such or any similar Hazardous Substances;
(10) any acts of the Borrower, the Principal, any Affiliate of the Borrower
and/or the Principal, or any licensee, sublicensee,
tenant, subtenant or other user of the Real Property
(or any portion thereof), in accepting any Hazardous
Substances for transport to disposal or treatment
facilities, incineration vessels or sites from which
there is a Release, or a threatened Release of any
Hazardous Substance which causes the incurrence of
costs for Remedial Work;
(11) any personal injury, wrongful death, or property or other damage
arising under any statutory or common law or tort law
theory (including, but not limited to, damages
assessed for a private or public nuisance or for the
conducting of an abnormally dangerous activity on or
near the Real Property (or any portion thereof)) as a
result of activities or conditions at the Real
Property (or any portion thereof) or related to the
Borrower, the Principal or any licensee, sublicensee,
tenant, subtenant or other user of the Real Property
(or any portion thereof);
(12) any misrepresentation or inaccuracy in any
representation or warranty or material breach or
failure to perform any covenants, agreements or other
obligations pursuant to Section 4.1(R-1) or Sections
5.1(D)-(H); or
(13) any diminution in value of the Collateral in any way
connected with any occurrence or other matter
referred to in Section 4.1(R-1) or Sections
5.1(D)-(H).
The procedures set forth in clause (iii) of Section 5.1(J) shall apply
to the provisions of this Section 5.1(I) as though set forth herein in their
entirety (with any conforming changes necessary due to the differences in
defined terms used in the two Sections). The provisions of, undertakings and
indemnification set forth in this Section 5.1(I) shall survive the satisfaction
and payment of the Indebtedness and termination of this Agreement.
(J) General Indemnity.
-----------------
(c)(i) The Borrower shall, at its sole cost and expense,
protect, defend, indemnify, release and hold harmless the Indemnified
Parties from and against any and all claims, suits, liabilities
(including, without limitation, strict liabilities), administrative and
judicial actions and proceedings, obligations, debts, damages, losses,
costs, expenses, diminutions in value, fines, penalties, charges, fees,
expenses, judgments, awards, amounts paid in settlement, foreseeable
and unforeseeable consequential damages, and litigation costs, of
whatever kind or nature and whether or not incurred in connection with
any judicial or administrative proceedings (including reasonable
attorneys' fees and expenses) (the "Losses") imposed upon or incurred
by or asserted against any Indemnified Parties (other than those
arising solely (x) from a state of facts that first came into existence
after (1) the Collateral Agent acquired title to the Trust Property for
the benefit of the Lenders through foreclosure or a deed in lieu
thereof (or through the exercise by any Agent or Lender of any other
remedy available to it at law or in equity) and the Borrower
relinquished possession of the Trust Property to the Collateral Agent
for the benefit of the Lenders or (2) Borrower permanently relinquished
possession of the Trust Property (A) to the Collateral Agent upon
demand therefor by the Collateral Agent on behalf of the Lenders or (B)
to a receiver for the Trust Property pursuant to a court order obtained
by the Collateral Agent on behalf of the Lenders or (y) from the bad
faith, gross negligence or willful misconduct of the Indemnified Party
seeking indemnification hereunder (without relieving the Indemnitors
from liability to the other Indemnified Parties), and directly or
indirectly arising out of or in any way relating to any one or more of
the following: (a) ownership of any Note, the Deed of Trust, any of the
other Loan Documents, the Collateral or any interest therein or receipt
of any Rents; (b) any amendment to, or restructuring of, the
Indebtedness, and any Note, the Deed of Trust, or any of the other Loan
Documents; (c) any and all lawful action that may be taken by any Agent
or any Lender in connection with the enforcement of the provisions of
this Agreement, any Note, the Deed of Trust or any of the other Loan
Documents, whether or not suit is filed in connection with same, or in
connection with the Borrower or any Affiliate of the Borrower becoming
a party to a voluntary or involuntary federal or state bankruptcy,
insolvency or similar proceeding; (d) any accident, injury to or death
of persons or loss of or damage to property occurring in, on or about
the Real Property or any part thereof or on the adjoining sidewalks,
curbs, adjacent property or adjacent parking areas, streets or ways;
(e) any use, nonuse or condition in, on or about the Real Property or
any part thereof or on the adjoining sidewalks, curbs, adjacent
property or adjacent parking areas, streets or ways; (f) any failure on
the part of Borrower or any Affiliate thereof to perform or be in
compliance with any of the terms of this Agreement or any of the other
Loan Documents (including, without limitation, any Default by the
Borrower in (1) the payment of any principal or interest (including,
without limitation after the giving of a prepayment notice) and/or (2)
making a borrowing after the Borrower has requested a borrowing
(including, without limitation, in either such case, any such Loss
arising from interest, fees or other amounts payable by a Lender to
lender(s) of funds obtained by it in order to make or maintain its Loan
Advance(s)); (g) performance of any labor or services or the furnishing
of any materials or other property in respect of the Real Property or
any part thereof; (h) the failure of any Person to file timely with the
Internal Revenue Service an accurate Form 1099-B, Statement for
Recipients of Proceeds from Real Estate, Broker and Barter Exchange
Transactions, which may be required in connection with this Agreement,
or to supply a copy thereof in a timely fashion to the recipient of the
proceeds of the transaction in connection with which this Agreement is
made; (i) any failure of the Real Property (or any portion thereof) to
be in compliance with any Legal Requirement; (j) the enforcement by any
Indemnified Party of the provisions of this Section 5.1(J); (k) any and
all claims and demands whatsoever which may be asserted against any
Agent or any Lender by reason of any alleged obligations or
undertakings on its part to perform or discharge any of the terms,
covenants, or agreements contained in any Lease; (l) the payment of any
commission, charge or brokerage fee to anyone which may be payable in
connection with the funding of the Loan. The provisions of this Section
5.1(J) shall not apply to (x) the matters covered by Section 5.1(I) or
(y) any dispute solely between Borrower, on the one hand, and any Agent
and/or any Lender, on the other hand (but without prejudice to any such
Agent's or Lender's right to collect, pursuant to any other provision
of any Loan Document or otherwise at law or in equity, any amounts
(including, without limitation, legal fees, disbursements and other
expenses) relating to any such dispute). Any amounts payable to an
Indemnified Party by reason of the application of this Section
5.1(J)(i) shall become immediately due and payable and shall bear
interest at the Default Rate from the date loss or damage is sustained
by such Indemnified Party until paid. The Borrower shall not be
required to pay, pursuant to this subsection 5.1(J), any amount that
the Borrower already paid to such Agent or Lender under subsection 2.10
or 2.13.
(ii) The Borrower shall, at its sole cost and
expense, protect, defend, indemnify, release and hold harmless the
Indemnified Parties from and against any and all Losses (including,
without limitation, reasonable attorneys' fees and costs incurred in
the investigation, defense, and settlement of Losses incurred in
correcting any prohibited transaction or in the sale of a prohibited
loan, and in obtaining any individual prohibited transaction exemption
under ERISA that may be required, in the Administrative Agent's sole
discretion) that the Indemnified Parties may incur, directly or
indirectly, as a result of a breach of the Borrower's covenants with
respect to ERISA and employee benefits plans contained herein.
(iii) Upon written request by any Indemnified Party,
the Borrower shall diligently defend such Indemnified Party (if
requested by any Indemnified Party, in the name of the Indemnified
Party) by attorneys and other professionals approved by the
Administrative Agent (which approval, so long as no Event of Default
shall then exist, shall not be unreasonably withheld or delayed).
Except to the extent that (A) a conflict of interest exists between or
among the interests of Borrower, any Affiliate thereof that is involved
in the claim, dispute, action or proceeding in question, and/or any
applicable Indemnified Party and/or (B) an Event of Default shall
exist, the Borrower shall be permitted to cause the same counsel and
other professionals to defend the Borrower, all such Affiliates and all
such Indemnified Parties in any such claim, dispute, action or
proceeding. From and after such time, if any, as an Event of Default
and/or such a conflict of interest shall arise, and/or, in the
reasonable judgment of any Indemnified Part(ies), Borrower shall not be
fulfilling its obligation to defend such Indemnified Part(ies) in
accordance with the provisions hereof, upon notice to Borrower, any
Indemnified Party (in the case of an Event of Default) or any affected
Indemnified Party (in the case of such a conflict of interest or a
determination by an Indemnified Party that Borrower shall not be so
fulfilling its obligations) may, at its or their, as applicable, option
(exercisable in such Indemnified Party(ies)' sole and absolute
discretion), (aa) require the Borrower to cause counsel and other
professionals acceptable to such Indemnified Part(ies), in its or
their, as applicable, sole discretion, to defend such Indemnified
Part(ies) or (bb) engage its own attorneys and other professionals to
defend or assist it, and, at the option of such Indemnified Part(ies),
its attorneys shall control the resolution of such claim, dispute,
action or proceeding; provided that, in the case of any such conflict
of interest, so long as (x) no Event of Default shall then exist and
(y) no Indemnified Party shall have determined that Borrower shall not
be so fulfilling its obligations to defend as aforesaid, then Borrower
shall be required to pay for only one additional (i.e. in addition to
counsel and other professionals representing Borrower and its
Affiliates) set of attorneys and other professionals who will represent
all of the Indemnified Parties. If any Indemnified Part(ies) shall
elect the option described in the foregoing clause (bb), upon demand,
the Borrower shall pay or, in the sole and absolute discretion of the
Indemnified Part(ies), reimburse, the Indemnified Part(ies) for the
payment of reasonable fees and disbursements of attorneys, engineers,
environmental consultants, laboratories and other professionals in
connection therewith. Furthermore, so long as (x) no Event of Default
shall then exist and (y) an Indemnified Party shall not have reasonably
determined that Borrower shall not be so fulfilling its obligations to
defend as aforesaid, such Indemnified Party shall not settle the claim,
dispute, action or proceeding in question without the consent of
Borrower (unless such Indemnified Party shall waive its right to be
indemnified under this Section 5.1(J) with respect to such claim,
dispute, action or proceeding). If an Event of Default shall exist or
any affected Indemnified Party shall reasonably determine that Borrower
shall not be so fulfilling such obligations, then the applicable
Indemnified Part(ies) may settle the claim, dispute, action or
proceeding in question without the consent of Borrower.
The provisions of and undertakings and indemnification set
forth in this Section 5.1(J) shall survive the satisfaction and payment of the
Indebtedness and termination of this Agreement.
(K) Access to Trust Property and the Common Facilities; Concessions. The
Borrower shall permit agents, representatives and employees of each Agent and
those of each Lender to inspect the Trust Property or any part thereof and the
Common Facilities (subject to the applicable restrictions, if any, on access
expressly set forth in the REA) or any part thereof (i) at any time and without
notice if an Event of Default shall exist and (ii) at such reasonable times as
may be requested by any Agent or any Lender upon reasonable advance notice if no
Event of Default shall exist. At all times, (x) all Concession Income shall be
solely the property of Borrower and neither any Affiliate of Borrower nor any
other Person shall have any right, title or interest in, or any claim to, any
Concession Income and (y) the Collateral shall include all personal property
necessary or desirable to operate the Gondola Concession (as such capitalized
term is defined in the definition of Concession Income).
(L) Notices. The Borrower shall promptly advise the Administrative Agent of the
occurrence of any Default or Event of Default.
(M) Cooperate in Legal Proceedings. The Borrower shall cooperate fully with each
Agent and each Lender with respect to any proceedings before any Governmental
Authority which may in any way affect the rights of any Agent or any Lender
hereunder or any rights obtained by any Agent or any Lender under any of the
Loan Documents and, in connection therewith, not prohibit the Lender, at its
election, from participating in any such proceedings.
(N) Perform Loan Documents. The Borrower shall observe, perform and satisfy all
the terms, provisions, covenants and conditions required to be observed,
performed or satisfied by it, and shall pay when due all costs, fees and
expenses required to be paid by it under the Loan Documents executed and
delivered by the Borrower.
(O) Insurance and Condemnation Benefits. The Borrower shall cooperate with the
Collateral Agent in obtaining for the Collateral Agent (for the benefit of the
Lenders) the benefits of any Insurance Proceeds or Condemnation Proceeds
lawfully or equitably payable to the Collateral Agent in connection with the
Real Property. The Collateral Agent shall be reimbursed for any reasonable
out-of-pocket expenses incurred in connection therewith (including reasonably
attorneys' fees, disbursements and other expenses) and, if the Administrative
Agent shall reasonably determine that an appraisal is necessary or helpful to
assist it in ascertaining its rights and obligations under Section 5.1(X), the
expense of an Appraisal on behalf of the Administrative Agent, such
reimbursement to be out of the Insurance Proceeds or Condemnation Proceeds, as
applicable; provided that to the extent that such Insurance Proceeds or
Condemnation Proceeds, as applicable, shall be less than such expenses (or if
there shall not be any Insurance Proceeds or Condemnation Proceeds), then the
Borrower, within ten (10) days after demand therefor by the applicable Agent,
shall reimburse such Agent for such expenses.
(P) Further Assurances. The Borrower shall, at the Borrower's sole cost
------------------
and expense:
(d)(i) if the Administrative Agent has a reasonable basis for
believing that a Lien affecting the Collateral (or any portion thereof)
that is not permitted by the Loan Documents shall exist, upon the
Administrative Agent's request therefor given from time to time, pay
for (a) reports of UCC, tax lien and judgment searches with respect to
the Borrower and (b) searches of title to the Collateral, each such
search to be conducted by search firms designated by the Administrative
Agent in each of the locations designated by the Administrative Agent,
each such designation, so long as no Event of Default shall then exist,
to be subject to Borrower's approval (not to be unreasonably withheld
or delayed);
(ii) furnish to the Administrative Agent all instruments,
documents, boundary surveys, footing or foundation surveys,
certificates, plans and specifications, appraisals, title and other
insurance reports and agreements, and each and every other document,
certificate, agreement and instrument required to be furnished pursuant
to the terms of the Loan Documents;
(iii) execute and deliver to the Administrative Agent such
documents, instruments, certificates, assignments and other writings,
and do such other acts necessary, to evidence, preserve and/or protect
the Collateral at any time securing or intended to secure any Note, as
the Administrative Agent may reasonably require (including, without
limitation, amended or replacement Deed of Trust, UCC financing
statements or other Collateral Security Instruments); and
(iv) do, execute, acknowledge and deliver all and every such
further lawful and reasonable acts, deeds, conveyances, mortgages,
deeds of trust, assignments, notices of assignments, other documents
and instruments, transfers and assurances for the better and more
effective carrying out of the intents and purposes of this Agreement
and the other Loan Documents, as the Administrative Agent shall
reasonably require from time to time or as the Borrower may be or may
hereafter become bound to do.
(Q) Management and Leasing of Trust Property.
----------------------------------------
(e)(i) The Trust Property shall be managed at all times by a
Manager pursuant to a Management Agreement until terminated as herein
provided. Pursuant to a Manager's Subordination, each Manager shall
agree that its Management Agreement is subject and subordinate in all
respects to the Lien of the Deed of Trust. Any Management Agreement may
be terminated by the Administrative Agent or the Collateral Agent (with
the approval of the Required Lenders) at any time at which an Event of
Default shall exist. After any such termination by the Administrative
Agent or Collateral Agent as aforesaid, the Administrative Agent or the
Collateral Agent (in either case, with the consent of the Required
Lenders) shall appoint or after any termination by the Borrower, the
Borrower shall appoint (unless an Event of Default shall then exist, in
which case the Administrative Agent or the Collateral Agent shall, as
aforesaid, appoint), a successor Manager to manage, pursuant to a
Management Agreement, the Trust Property which must be an Acceptable
Manager. Notwithstanding the foregoing, any successor Manager selected
hereunder by the Administrative Agent, the Collateral Agent or the
Borrower to manage the Trust Property must be an Acceptable Manager.
The Borrower further covenants and agrees that each Manager shall at
all times during the term of the Loan maintain worker's compensation
insurance as required by applicable Legal Requirements.
(ii) At all times, a Leasing Broker shall be responsible for
procuring tenants for the Trust Property pursuant to a Brokerage
Agreement until terminated as herein provided. Pursuant to a Broker's
Subordination, each Leasing Broker shall agree that its Brokerage
Agreement is subject and subordinate in all respects to the Lien of the
Deed of Trust. Any Brokerage Agreement may be terminated by the
Administrative Agent or the Collateral Agent (with the approval of the
Required Lenders) at any time at which an Event of Default shall exist.
After any such termination by the Administrative Agent or Collateral
Agent as aforesaid, the Administrative Agent or the Collateral Agent
(in either case, with the consent of the Required Lenders) shall
appoint or, after any termination by the Borrower, the Borrower shall
appoint (unless an Event of Default shall then exist, in which case the
Administrative Agent or the Collateral Agent shall, as aforesaid,
appoint), a successor Leasing Broker to procure tenants for the Trust
Property which must be an Acceptable Leasing Broker. Notwithstanding
the foregoing, any successor leasing broker selected hereunder by the
Administrative Agent, the Collateral Agent or the Borrower to procure
tenants for the Trust Property must be an Acceptable Leasing Broker.
The Borrower further covenants and agrees that each Leasing Broker
shall at all times during the term of the Loan maintain worker's
compensation insurance as required by applicable Legal Requirements.
(iii) The Borrower shall: (A) promptly perform and/or observe
all of the covenants and agreements required to be performed and
observed by it under each Management Agreement and under each Brokerage
Agreement and do all things necessary to preserve and to keep
unimpaired its material rights thereunder; (B) promptly notify the
Administrative Agent of any default under any Management Agreement or
any Brokerage Agreement of which it is aware; (C) promptly deliver to
the Administrative Agent a copy of each financial statement, business
plan, capital expenditures plan, notice and report received by it under
any Management Agreement or under any Brokerage Agreement; and (D) to
the extent that a Commercially Reasonable Owner would do so (or if
necessary to prevent the occurrence of Material Adverse Effect),
promptly enforce the performance and observance of all of the covenants
and agreements required to be performed and/or observed by the Manager
under each Management Agreement and by the Broker under each Brokerage
Agreement.
(R) Financial Reporting.
-------------------
(f)(i) The Borrower shall keep and maintain or shall cause to
be kept and maintained on a Fiscal Year basis in accordance with GAAP
consistently applied, books, records and accounts reflecting in
reasonable detail all of the financial affairs of the Borrower and all
items of income and expense in connection with the operation of the
Collateral and in connection with any services, equipment or
furnishings provided in connection with the operation of the
Collateral. Each Agent and each Lender shall have the right from time
to time at all times during normal business hours upon reasonable prior
written notice to the Borrower to examine such books, records and
accounts at the office of the Borrower or other Person maintaining such
books, records and accounts and to make such copies or extracts thereof
as any Agent or any Lender shall desire, which shall be done, unless an
Event of Default shall then exist, at such Agent's or such Lender's, as
applicable, sole cost and expense. At any time that an Event of Default
shall exist, the Borrower shall pay any reasonable costs and expenses
incurred by any Agent or any Lender to examine the Borrower's
accounting records with respect to the Collateral as any Agent or any
Lender shall reasonably determine to be necessary or appropriate in the
protection of such Agent's and such Lender's respective interests.
(ii) The Borrower shall furnish to the Administrative
Agent annually, within one hundred twenty (120) days following the end
of each Fiscal Year, a complete copy of the Borrower's financial
statements audited by a "Big Four" independent certified public
accounting firm in accordance with GAAP consistently applied covering
the Collateral and the Borrower's financial position and results of
operations for such Fiscal Year and including a balance sheet, and a
statement of profit and loss, for Borrower; provided that, the Borrower
shall use its best efforts to furnish such financial statements to the
Administrative Agent within ninety (90) days following the end of each
Fiscal Year. Each of the foregoing shall be in form, and in such
detail, as shall be reasonably acceptable to the Administrative Agent.
Such financial statements shall set forth the financial condition and
the income and expenses for the Collateral and the Borrower for the
immediately preceding Fiscal Year. The Administrative Agent and the
Lenders shall (unless an Event of Default shall then exist, at their
sole cost and expense), have the right from time to time to review the
auditing procedures used in the preparation of such annual financial
statements and to request reasonable additional procedures of the
aforesaid independent certified public accounting firm; provided that,
Borrower shall be solely responsible for all costs relating to each
such review that shall occur, and each such additional procedure that
shall be requested, at such time as an Event of Default shall exist.
Together with the Borrower's annual financial statements, the Borrower
shall furnish to the Administrative Agent a Borrower's Certificate
certifying as of the date thereof that the annual financial statements
present fairly in all material respects the results of operations and
financial condition of the Borrower and the Collateral in accordance
with GAAP consistently applied for the relevant period.
(iii) The Borrower shall furnish to the
Administrative Agent, within sixty (60) days following the end of each
quarter of each Fiscal Year (i) a quarterly and year-to-date statement
of profit and loss and a balance sheet, (ii) a true, complete and
correct rent roll for the Trust Property, including a list of which
tenants are in default under their respective Leases, identifying each
tenant, the monthly rent, percentage and additional rent, if any,
payable by such tenant, the expiration date of such tenant's Lease, the
security deposit, if any, held by the Borrower under the Lease, the
space covered by the Lease, and the arrearages for such tenant, if any,
the sales per square foot of each tenant (to the extent available to
Borrower using commercially reasonable efforts), which rent roll shall
be substantially in the form of the Closing Date Rent Roll (with such
changes, if any, as shall be reasonably required by the Administrative
Agent from time to time), (iii) quarterly and year-to-date operating
statements reflecting the results of operation of the Collateral for
the immediately preceding calendar quarter, (iv) a schedule of tenant
security deposits for such month, together with a certification of the
Manager as to the balance of such deposits and that such tenant
security deposits are being held in accordance with all Legal
Requirements; provided that, the Borrower shall use its best efforts to
furnish such financial statements, rent roll and operating statements,
described above to the Administrative Agent within forty-five (45) days
following the end of each quarter of each Fiscal Year; provided further
that with respect to any such financial statements, Rent Roll,
operating statements, recalculation and other materials relating to the
fourth quarter of any Fiscal Year, Borrower shall deliver the same to
the Administrative Agent on or before the date upon which Borrower is
required, under this Agreement, to deliver to the Administrative Agent
the audited annual financial statements with respect to such Fiscal
Year. Each of the foregoing shall be in form, and in such detail, as
shall be reasonably acceptable to the Administrative Agent and shall be
accompanied by an Borrower's Certificate dated as of the date of
delivery of such items, certifying that such items are true, correct,
accurate and complete and fairly present the financial condition and
results of operations of the Borrower and the Collateral in a manner
consistent with GAAP for the relevant period.
(iv) from time to time during the term of the Loan,
within ten (10) Business Days after any request therefor by the
Administrative Agent, Borrower shall furnish to the Administrative
Agent true, complete and correct copies of all Leases (other than those
that are no longer in full force and effect), together with a
certification by the Borrower that such Leases are true, complete and
correct copies of all Leases.
(v) The Borrower shall furnish to the Administrative
Agent, within thirty (30) days after request therefor, such further
information with respect to the operation of the Collateral and the
financial affairs of the Borrower as may be reasonably requested by the
Administrative Agent, including all business plans prepared for the
Borrower; provided that, if such information shall be produced in the
ordinary course of the Borrower's business, then it shall be produced
at Borrower's cost and expense, and if such information shall not be
produced in the ordinary course of the Borrower's business, then the
Lenders shall reimburse the Borrower for the reasonable actual
out-of-pocket costs that are incurred by the Borrower in producing such
information.
(vi) The Administrative Agent and the Lenders hereby
acknowledge that the forms of the quarterly and annual financial
statements attached hereto as Exhibit K is acceptable to them.
(S) Conduct of Business. Without limiting the generality of any other provision
of this Agreement, the Borrower shall cause the operation of the Trust Property
and the Common Facilities to be conducted as follows:
(g)(i) the Borrower shall maintain or cause to be maintained
the standard of the Trust Property at all times at a level not lower
than that of, and operate or cause the Trust Property to be operated
as, a First Class Mall; and
(ii) the Borrower shall maintain or cause to be maintained
sufficient Inventory and Equipment of types and quantities at the Trust
Property to enable the Borrower to operate the Trust Property in
accordance with the foregoing clause (i).
(T) Interest Rate Cap Agreement. On the Closing Date, or within five (5) days
after the Closing Date (or, if Borrower, within five (5) days after the Closing
Date, shall pay $262,500 in Funds to Collateral Agent to be used to pay the
premium of the interest rate cap described below when the cap is purchased
(whether or not the cap is provided by the Collateral Agent or any Affiliate
thereof), then within thirty (30) days after the Closing Date), the Borrower
shall purchase from an institution reasonably satisfactory to the Syndication
Agent and shall deliver to the Syndication Agent a LIBOR based interest rate cap
agreement, in form and substance reasonably satisfactory to the Syndication
Agent, providing for a strike rate of eight and one-half (8.50%) percent, a term
that is coterminous with the term of the Loan, a notional amount equal to the
Loan Amount; provided that if the premium in respect of the interest rate cap in
question shall exceed the product of (x) 25 basis points multiplied by (y) the
Loan Amount (the "Maximum Premium"), and the Syndication Agent shall not arrange
for an interest rate cap to be provided by a provider (which may be an Affiliate
of any Agent or Lender) that is reasonably satisfactory to Borrower who will
provide the required interest rate cap for a premium that does not exceed the
Maximum Premium (Borrower hereby acknowledging that no Agent or Lender shall be
obligated to arrange, or to attempt to arrange, for such a cap or such a
provider), then the notional amount of the interest rate cap that Borrower shall
be required to obtain shall be reduced to the extent necessary for the premium
to equal the Maximum Premium. The Collateral Agent shall have a first priority
security interest upon any such interest rate cap agreement. The cap provider
shall consent to the granting of the aforesaid security interest pursuant to an
instrument in form and substance reasonably satisfactory to the Syndication
Agent.
(U) Single-Purpose Entity.
---------------------
(h)(i) The Borrower at all times shall be a duly formed and
validly existing limited liability company under the laws of its state
of formation and a Single-Purpose Entity. The Managing Member at all
times shall be a duly formed and validly existing corporation under the
laws of the State of its formation and a Single-Purpose Entity;
(ii) Each of the Borrower and the Managing Member shall at all
times comply with the provisions of its organizational documentation
and the laws of the State of Nevada (and, in the case of Borrower,
Delaware) relating to, in the case of Borrower, limited liability
companies and, in the case of Managing Member, corporations.
(iii) Each of the Borrower and the Managing Member shall
observe all customary formalities regarding its existence.
(iv) Each of the Borrower and the Managing Member shall
accurately maintain its financial statements, books and records and
other corporate documents separate from those of its direct and
indirect members and shareholders and from those of any other Person.
Neither the Borrower nor the Managing Member shall commingle its assets
with those of such members or shareholders or any other Person.
(v) Each of the Borrower and the Managing Member shall pay
its own liabilities from its own separate assets.
(vi) Each of the Borrower and the Managing Member shall
identify itself in all dealings with the public, under its own name or
trade names and as a separate and distinct entity. Neither the Borrower
nor the Managing Member shall identify itself as being a division or a
part of any other entity. Neither the Borrower nor the Managing Member
shall identify its direct or indirect members or shareholders or any
Affiliates of the Borrower or Managing Member or of such members or
shareholders as being a division or part of the Borrower or of Managing
Member or such members or shareholders, as applicable.
(vii) Neither the Borrower nor the Managing Member shall
assume or guarantee the liabilities of direct or indirect members or
shareholders, any Affiliates of such members or shareholders, or any
other Persons, except as expressly permitted by this Agreement. Neither
the Borrower nor the Managing Member shall acquire obligations,
interests or securities of such members or shareholders (or any
predecessor entity or other Person), or any Affiliates of such members
or shareholders (other than, in the case of Managing Member, its
membership interest in Borrower). Neither the Borrower nor the Managing
Member shall make loans to its direct or indirect members or
shareholders (or any predecessor entity or other Person), any
Affiliates of such members or shareholders or to any other Person.
(viii) Neither the Borrower nor the Managing Member shall
enter into or be a party to any transaction with its direct or indirect
members, shareholders, officers or directors (or any predecessor entity
or other Person) or any Affiliates of any of the foregoing, except for
in the ordinary course of business on terms which are no less favorable
to the Borrower or Managing Member, as applicable, than would be
obtained in a comparable arm's length transaction with an unrelated
third party.
(V) ERISA. The Borrower shall deliver to the Administrative Agent as soon as
possible, and in any event within thirty (30) days after the Borrower knows or
has reason to believe that any of the events or conditions specified below with
respect to any Plan or Multiemployer Plan has occurred or exists, a statement
signed by a senior financial officer of the Borrower setting forth details
respecting such event or condition and the action, if any, that the Borrower or
its ERISA Affiliate proposes to take with respect thereto (and a copy of any
report or notice required to be filed with or given to PBGC by the Borrower or
an ERISA Affiliate with respect to such event or condition):
(i)(i) any reportable event, as defined in Section 4043(b) of
ERISA and the regulations issued thereunder, with respect to a Plan, as
to which PBGC has not by regulation waived the requirement of Section
4043(a) of ERISA that it be notified within 30 days of the occurrence
of such event (provided that a failure to meet the minimum funding
standard of Section 412 of the Code or Section 302 of ERISA, including,
without limitation, the failure to make on or before its due date a
required installment under Section 412(m) of the Code or Section 302(e)
of ERISA, shall be a reportable event regardless of the issuance of any
waivers in accordance with Section 412(d) of the Code); and any request
for a waiver under Section 412(d) of the Code for any Plan at a time
when such Plan has material Unfunded Benefit Liabilities;
(ii) the distribution under Section 4041 of ERISA of
a notice of intent to terminate any Plan or any action taken by the
Borrower or an ERISA Affiliate to terminate any Plan;
(iii) the institution by PBGC of proceedings under
Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Plan, or the receipt by the Borrower or any
ERISA Affiliate of the Borrower of a notice from a Multiemployer Plan
that such action has been taken by PBGC with respect to such
Multiemployer Plan;
(iv) the complete or partial withdrawal from a
Multiemployer Plan by the Borrower or any ERISA Affiliate of the
Borrower that results in material liability under Section 4201 or 4204
of ERISA (including the obligation to satisfy secondary liability as a
result of a purchaser default) or the receipt by the Borrower or any
ERISA Affiliate of the Borrower of notice from a Multiemployer Plan
that it is in reorganization or insolvency pursuant to Section 4241 or
4245 of ERISA or that it intends to terminate or has terminated under
Section 4041A of ERISA;
(v) the institution of a proceeding by a fiduciary of
any Multiemployer Plan against the Borrower or any ERISA Affiliate of
the Borrower to enforce Section 515 of ERISA, which proceeding is not
dismissed within 30 days;
(vi) the adoption of an amendment to any Plan that,
pursuant to Section 401(a)(29) of the Code or Section 307 of ERISA,
would result in the loss of tax-exempt status of the trust of which
such Plan is a part if the Borrower or an ERISA Affiliate of the
Borrower fails to timely provide security to the Plan in accordance
with the provisions of said Sections;
(vii) the imposition of a Lien in connection with a
Plan; and
(viii) the Unfunded Benefit Liabilities of one or more Plans
increase after the date of this Agreement by an amount that has a
Material Adverse Effect.
(W) Assignment or Participation of Loan. In the event that any Lender notifies
the Borrower that a sale or other transfer or assignment (an "Assignment") of,
or a sale or other transfer of a participation interest (a "Participation") in,
this Agreement, any Note and/or any of the other Loan Documents to another party
is desirable to such Lender, provided that Borrower's consent to such Assignment
or Participation has been obtained (to the extent such Lender is required to
obtain the same pursuant to the express terms hereof), then the Borrower shall
promptly cooperate, in all reasonable respects, with such Lender in connection
therewith, including preparing any information reasonably requested by such
Lender ("Information") and (except in connection with (x) an Assignment of the
entire Loan to one Person or (y) an Assignment by any assignee of GSMC with
respect to the Loan), at such Borrower's cost, entering into any amendments to
the Loan Documents reasonably requested by such Lender (and consented to by the
Required Lenders (including such Lender) or all of the Lenders, as required
under subsection 10.4 hereof) in connection with the Assignment or Participation
provided that such amendments contain only immaterial changes that will have an
immaterial affect on Borrower; provided, however, that, except as provided in
Section 10.9, no such Participation or Assignment shall materially affect the
Borrower's obligations under this Agreement, any Note or any other Loan
Document; provided further that if the aforesaid Information shall be produced
in the ordinary course of the Borrower's business, then it shall be produced at
Borrower's cost and expense, and if such Information shall not be produced in
the ordinary course of the Borrower's business, then such Lender shall reimburse
the Borrower for the reasonable actual out-of-pocket costs that are incurred by
the Borrower in producing such information. Notwithstanding the foregoing, in no
event shall this covenant be deemed to obligate the Borrower to cause the
Principal to deliver, or to cause to be delivered, any financial statements
(audited or otherwise), certificates or documents relating to the net worth,
assets or financial condition of the Principal.
(X) Insurance and Condemnation.
--------------------------
(j)(i) Without limiting Borrower's obligations under any other
provision of any other Loan Document, Borrower shall comply, and shall
diligently enforce all other REA Parties' obligations to comply, with
the terms, conditions and provisions of the REA relating to insurance
(including, without limitation Insurance Policies), Casualties, Takings
and restoration or repair after a Casualty or Taking. Promptly after
receipt therefor by Borrower, Borrower shall furnish to the
Administrative Agent copies of each notice or other written material
relating to insurance (including, without limitation Insurance
Policies), Casualties, Takings and restoration or repair after a
Casualty or Taking that Borrower receives. Additionally, Borrower shall
obtain and maintain, promptly after request therefor by the
Administrative Agent, such other insurance and in such amounts as the
Administrative Agent from time to time may reasonably request, provided
that such insurance and such amounts are then commonly insured against
with respect to property similarly situated (or if there is no property
similarly situated, for other large commercial buildings located in Las
Vegas, Nevada and/or Clark County, Nevada and do not violate the
provisions of the REA). All such other insurance shall be obtained
under valid and enforceable policies, in such forms as may from time to
time be reasonably satisfactory to the Administrative Agent, issued by
financially sound and responsible insurance companies that are
reasonably acceptable to the Administrative Agent. Prior to the Closing
Date, Borrower furnished to the Syndication Agent all Insurance
Policies then required to be in effect under the REA. Not less than
fifteen (15) days prior to the expiration dates of such Insurance
Policies (and any replacements thereof), the Borrower shall furnish to
the Collateral Agent certificates of insurance marked "premium paid" or
accompanied by evidence satisfactory to the Administrative Agent of
payment of the premiums due thereunder (the "Insurance Premiums"),
which insurance certificates shall also evidence the fact that each
such Insurance Policy shall have been renewed; provided that if, at any
time, any Insurance Policy shall be amended, supplemented or otherwise
modified or replaced (other than any modification that merely extends
the expiration date), then the Borrower shall furnish to the Collateral
Agent for the benefit of the Lenders a copy of such amendment,
supplement or modification or replacement Insurance Policy, as
applicable. After the occurrence of an Event of Default, with respect
to any matter relating to insurance (including, without limitation
Insurance Policies), Casualties, Takings and restoration or repair
after a Casualty or Taking, at the Administrative Agent's election,
Borrower shall act in accordance with the directions of the
Administrative Agent (as directed by the Required Lenders) or the
Administrative Agent (at the direction of the Required Lenders) shall
be entitled to act in lieu of Borrower with respect to any such matter.
(ii) The Borrower shall not obtain separate insurance
concurrent in form or contributing in the event of loss with that
required in Section 5.1(X)(i) to be furnished by, or which may be
reasonably required to be furnished by, the Borrower.
(iii) All Policies of insurance provided for or
contemplated by Section 5.1(X)(i)(other than property insurance) shall
name the Collateral Agent (for the benefit of the Lenders), the
Lenders, their respective successors and assigns (including any
servicers, trustees or other designees of the Collateral Agent), and
the Borrower as the insured or additional insured, as their respective
interests may appear.
(iv) The Borrower shall furnish to the Administrative
Agent and to the Collateral Agent, within thirty (30) days of
reasonable request therefor by the Administrative Agent (which request
shall not be made more than once during any calendar year), a
Borrower's Certificate as to the amounts of insurance maintained in
compliance herewith, of the risks covered by such insurance and of the
insurance company or companies which carry such insurance.
(v) If all or any material portion of the Trust
Property and/or the Common Facilities shall be damaged or destroyed, in
whole or in part, by fire or other casualty, or other loss with respect
to any material portion of the Trust Property and/or the Common
Facilities shall occur, then the Borrower shall give prompt notice
thereof to the Agents. The Borrower hereby assigns to the Collateral
Agent, for the benefit of the Lenders, as collateral security for the
Indebtedness and the rest of the Obligations (as defined in the Deed of
Trust), all Insurance Proceeds that the Borrower may be entitled to
receive under the REA.
(vi) Any Insurance Proceeds of any applicable
property insurance that, under the REA, Borrower or the Collateral
Agent is entitled to retain (and not apply to repair or restoration of
the Trust Property) shall be immediately paid over to the Collateral
Agent to be applied, at the option of the Required Lenders, in their
sole discretion, to the payment of the Indebtedness (in such order and
in such manner as the Required Lenders shall determine in their sole
discretion and whether or not then due and payable); provided that if
the Required Lenders elect not to apply such Insurance Proceeds to the
Indebtedness, then the Collateral Agent shall pay such Insurance
Proceeds over to the Borrower. All Insurance Proceeds from time to time
held by the Collateral Agent for the benefit of the Lenders shall
constitute additional security for the Indebtedness. Any proceeds of
any business interruption, business income, rental loss or similar
insurance (collectively, "Business Income Insurance") shall be paid
over to, and held by, the Collateral Agent and shall be applied to the
Indebtedness payable hereunder and under the other Loan Documents from
time to time; provided that, so long as no Event of Default shall
exist, such insurance proceeds shall be equitably apportioned, as
reasonably determined by the Administrative Agent, between the
Indebtedness and other amounts that are payable in respect of the use,
operation and maintenance of the Collateral in accordance with the
terms of the Loan Documents (and the portion of such insurance proceeds
allocated by the Administrative Agent to such other amounts that are
payable in respect of the use, operation and maintenance of the
Collateral in accordance with the terms of the Loan Documents shall be
paid to Borrower and shall be applied by Borrower to pay such other
amounts); provided, further, that nothing herein contained shall be
deemed to relieve the Borrower of its obligations to pay the
Indebtedness on the respective dates of payment provided for in the
Loan Documents, except to the extent such amounts are actually paid out
of the proceeds of such Business Income Insurance.
(vii) In the event of any Casualty or any Taking
affecting the Trust Property or any part thereof, Borrower shall
promptly commence and diligently prosecute the repair and restoration
of the Trust Property as nearly as possible to the condition, character
and value of the Trust Property immediately prior to such Casualty or
Taking (in the case of a Taking, to the extent practicable)(each, a
"Restoration"), with such alterations as may be approved by the
Administrative Agent (to the extent that the Administrative Agent's
approval of such alterations shall be required under the Loan
Documents) and otherwise in accordance with all applicable Legal
Requirements, Insurance Requirements, plans and specifications approved
by the Administrative Agent (to the extent that the Administrative
Agent's approval thereto is required under the Loan Documents), the
other provisions of the Loan Documents and the REA. Borrower shall make
such Restorations as aforesaid regardless of whether any Insurance
Proceeds (or any other insurance proceeds) or any Condemnation Awards
are received by the Borrower or any REA Owner and whether such
Insurance Proceeds (or such insurance proceeds) or Condemnation Awards,
if received, are sufficient to pay for the costs of such Restoration.
The Borrower shall pay all costs (and if required by the Administrative
Agent, the Borrower, prior to commencing such repairs and restoration,
shall deposit the total thereof with the Collateral Agent (for the
benefit of the Lenders)) or provide a letter of credit or other
security, in amounts, form and substance reasonably satisfactory to the
Administrative Agent, securing the Borrower's obligations to pay such
costs) of such repairs and restoration in excess of the Insurance
Proceeds made available to Borrower pursuant to the REA.
(viii) The Administrative Agent may retain, on behalf
of the Lenders, at the Borrower's cost, an independent consulting
engineer selected by the Administrative Agent (the "Casualty
Consultant") to inspect work in connection with any Restoration as such
Restoration progresses and to review plans and specifications as
provided below; provided that, if no Event of Default shall then exist,
the Administrative Agent shall obtain the Borrower's consent to the
compensation to be paid to such Casualty Consultant (which consent
shall not be unreasonably withheld or delayed).
(ix) If, immediately after completion of any
Restoration, the Trust Property will be, in all material respects, the
same as it was immediately prior to the Casualty or Taking in question,
then the Administrative Agent shall have no approval rights with
respect to any plans and specifications relating thereto. Otherwise,
the Borrower shall follow the procedures set forth in the Loan
Documents with respect to Renovations (as if such Restoration were a
Renovation); provided that, to the extent that the Administrative
Agent's approval of the plans and specifications relating to the
Restoration in question is required hereunder, the Administrative Agent
shall be entitled to engage the Casualty Consultant to review such
plans and specifications. The Collateral Agent, while an Event of
Default shall exist, shall have the use of the plans and specifications
and all Permits required or obtained in connection with the
Restoration. All reasonable costs and expenses incurred by the
Administrative Agent and/or the Collateral Agent in connection with
making Insurance Proceeds or Condemnation Awards available for the
Restoration (including, without limitation, reasonable counsel fees and
disbursements and the Casualty Consultant's fees and expenses), shall
be paid by the Borrower.
(x) Without limiting any other rights or remedies of
the Agents and Lenders under the Loan Documents (or at law or in
equity), with respect to any Taking ("consensual" or otherwise)
described on Schedule I attached hereto which Borrower, under
applicable Legal Requirements, shall not be prohibited from contesting,
the Administrative Agent shall be entitled to commence, and/or
participate in, any action or proceeding relating to such Taking if the
Administrative Agent has reason to believe that (i) such Taking is
likely to cause a Material Adverse Effect and (ii) Borrower is not
diligently contesting such Taking in good faith and through appropriate
means. Additionally, the Administrative Agent, if it so elects, shall
be entitled to participate in any action or proceeding relating to any
other Taking. The Collateral Agent is hereby irrevocably appointed as
the Borrower's attorney-in-fact, coupled with an interest, with
exclusive power to collect, receive and retain any Condemnation
Proceeds for any Taking (in accordance with, if no Event of Default
shall then exist, the directions of the Administrative Agent, or, if an
Event of Default shall then exist, the written directions of the
Required Lenders).
(xi) The Borrower shall promptly give the Agents
written notice of the actual or threatened commencement of any
proceeding for a Taking and shall deliver to the Agents copies of any
and all papers served in connection with such proceedings. The
Collateral Agent is hereby irrevocably appointed as the Borrower's
attorney-in-fact, coupled with an interest, with exclusive power to
collect, receive and retain any Condemnation Proceeds for said Taking
which the Trustee is not entitled to collect, receive and/or retain, as
applicable, under the REA (in accordance with, if no Event of Default
shall then exist, the directions of the Administrative Agent, or, if an
Event of Default shall then exist, the written directions of the
Required Lenders). Notwithstanding any Taking or Casualty, the Borrower
shall continue to pay the Indebtedness at the time and in the manner
provided for in this Agreement, the Notes, the Deed of Trust and the
other Loan Documents and the Indebtedness shall not be reduced, if at
all, unless and until any Insurance Proceeds or Condemnation Proceeds
therefor shall have been actually received and applied by the
Collateral Agent or any Lender to the payment of the Indebtedness. The
Borrower shall cause all Condemnation Proceeds to which it is entitled
and which is not, under the terms of the REA, required to be paid to
the Trustee, to be paid directly to the Collateral Agent (for the
benefit of the Lenders) and the Borrower hereby irrevocably assigns to
the Collateral Agent (for the benefit of the Lenders) all of Borrower's
right, title and interest in and to any Condemnation Proceeds paid
prior to payment and performance of all of Indebtedness and all
obligations under the Loan Documents; provided that if the Required
Lenders elect not to apply such Condemnation Proceeds to the
Indebtedness, then the Collateral Agent shall pay such Insurance
Proceeds over the Borrower.
(xii) If the Trust Property is sold, through
foreclosure, a deed in lieu of foreclosure or other exercise of
remedies by any Agent or Lender prior to the receipt by the Collateral
Agent of any such Condemnation Proceeds or any Insurance Proceeds,
whether or not a deficiency judgment on any Note shall have been
sought, recovered or denied, the Collateral Agent shall have the right
to have reserved, and at the direction of the Required Lenders, shall
reserve, in any foreclosure decree a right to receive said award or
payment, or a portion thereof sufficient to pay the Indebtedness. In no
case shall any such application reduce or postpone any payments
otherwise required pursuant to the this Agreement, other than the final
payment under the Loan Documents.
(Y) Subordination of Indenture Deed of Trust to REA Amendment. Borrower shall
use commercially reasonable and diligent efforts to cause the holder of the
Mortgage Notes Indenture Deed of Trust (as defined in the FADAA) to subordinate,
pursuant to documentation reasonably acceptable to Syndication Agent and
Collateral Agent, such deed of trust to that certain Amended and Restated
Reciprocal Easement, Use and Operating Agreement dated as of November 14, 1997
among Interface Group - Nevada, Inc., Mall Construction (as
predecessor-in-interest to Grand Canal, as predecessor-in-interest to Borrower)
and Venetian, as amended pursuant to that certain First Amendment to Amended and
Restated Reciprocal Easement, Use and Operating Agreement dated as of the date
hereof. Borrower shall cause original counterparts of the same to be delivered
to Collateral Agent promptly upon Borrower's obtaining such subordination
documentation.
1. Leases.
------
(i) Except as otherwise consented to by the Administrative
Agent in writing, Borrower shall not execute, or permit to be executed,
any Lease (or any oral or written renewal, extension, amendment,
alteration, modification, supplement or other change to the terms
thereof) other than a Lease (in the case of a renewal, extension,
supplement, amendment, alteration, modification, supplement or other
change, after giving effect to such renewal, extension, supplement,
amendment, alteration, modification, supplement or other change) that
(i)(A) is an SNDA Qualified Lease and (B) if such Lease (or a COREA
Qualified Lease Commitment relating thereto) was, prior to the time in
question, included in the calculation of COREA Rent in connection with
any determination as to whether the Approval Criteria were satisfied,
is also a COREA Qualified Lease or (ii) is a Subordinate Lease (each
such lease, a "Permitted Lease"). The Borrower (1) shall observe and
perform, in all material respects, all the obligations imposed upon the
lessor under all Leases (other than Subordinate Leases); (2) shall
promptly send copies to the Agents of all notices of default which the
Borrower shall send or receive thereunder; (3) to the extent that a
Commercially Reasonable Owner would do so (or if necessary to avoid a
Material Adverse Effect), shall enforce all of the terms, covenants and
conditions contained in all Leases (other than Subordinate Leases) upon
the part of the lessee thereunder to be observed or performed; (4)
shall not collect any Rent more than one (1) month in advance of the
due date therefor set forth in any such Lease (other than the first or
last month's minimum rent); (5) shall not execute any assignment of
lessor's interest in any such Lease, or any Rents (except (A) a
transfer of the same to the successor or surviving Person resulting
from a merger or consolidation of Borrower with any other Person in
accordance with, and subject to, the terms, provisions and conditions
of, this Agreement, (B) a transfer of the same to an Affiliate
Transferee in accordance with, and subject to, the terms, provisions
and conditions of, this Agreement, (C) a pledge or collateral
assignment of the same to the Collateral Agent pursuant to any other
Loan Document, and (D) a pledge or collateral assignment of the same to
the Junior Lender in accordance with, and subject to, the terms,
provisions and conditions of, this Agreement); (6) shall not cancel or
terminate any such Lease or accept a surrender thereof (or permit any
cancellation, termination or surrender to or of any such Lease);
provided that (x) the Borrower may terminate any such Lease as a result
of a material, bona fide default on the part of the tenant under such
Lease and (y) the Borrower may accept a cancellation, termination or
surrender by the tenant under such Lease if such cancellation,
termination or surrender is done pursuant to the express terms of such
Lease; (7) shall not take (or refrain from taking) any action that
would effect a merger of the estates and rights of, or a termination or
diminution of the obligations of, the lessee under any such Lease; (8)
with respect to any matter relating to any such Lease as to which
Borrower has discretion (e.g., the relocation of the premises demised
under any such Lease), shall act as a Commercially Reasonable Owner
would act and in a manner which is not likely to cause a Material
Adverse Effect and (9) with respect to any instance in which Borrower
shall have discretion as to whether to grant or withhold consent to any
assignment or subletting, Borrower shall not consent to any assignment
of or subletting under any such Lease unless a Commercially Reasonable
Owner would agree to such assignment or subletting and the same is not
likely to have a Material Adverse Effect. Without limiting the other
provisions of this Section 5.1(Z), the Administrative Agent may
condition its approval of any Lease requiring its approval hereunder
upon the unconditional execution and delivery by (x) the tenant or
other occupant under such Lease of an estoppel certificate in the form
attached hereto as Exhibit Q, the contents of which estoppel
certificate shall be acceptable to the Administrative Agent and/or (y)
such tenant and Borrower of a SNDA. Notwithstanding anything to the
contrary contained herein, Borrower shall not, without the prior
written consent of the Administrative Agent, enter into any new Lease
or enter into any (oral or written) renewal, extension, amendment,
alteration, modification or other change of, or supplement to, any
Lease while an Event of Default shall exist.
(ii) With respect to any SNDA Qualified Lease, upon Borrower's
request thereof, the Collateral Agent shall execute and deliver an SNDA
with respect thereto.
(iii) If Borrower shall desire for the Collateral Agent to
execute an SNDA with respect to a given Lease that shall not constitute
an Automatically Qualified SNDA Lease, then Borrower may furnish to the
Agents a term sheet that (i) describes, in form and detail reasonably
satisfactory to the Administrative Agent, the proposed Lease and (ii)
which term sheet, or the transmittal letter sent with such term sheet,
is legended (in bold, capitalized letters) as follows:
"This is a Lease Term Sheet referred to in that
certain Loan Agreement dated as of December 20, 1999 among the lenders
from time to time parties thereto, Goldman Sachs Mortgage Company, as
Administrative Agent, The Bank of Nova Scotia, as Administrative Agent,
The Bank of Nova Scotia, as Collateral Agent and Grand Canal Shops Mall
Subsidiary, LLC, as borrower. If you do not approve or disapprove, in
writing, this Lease Term Sheet within ten (10) Business Days after the
date upon which you actually receive this Lease Term Sheet, then you
shall be deemed to have approved this Lease Term Sheet."
If Borrower shall furnish such a term sheet (a "Lease
Term Sheet") to the Agents, then Administrative Agent shall approve or
disapprove, in writing, such Lease Term Sheet within ten (10) Business
Days after the date upon which the Agents shall actually receive such
Lease Term Sheet (without giving effect to the "deemed receipt"
provisions of Section 10.6 hereof). Borrower hereby agrees that the
Administrative Agent shall be deemed to have disapproved a given Lease
Term Sheet if the Administrative Agent shall have deposited written
notice of such disapproval in the United States mail (registered or
certified mail, postage prepaid and return receipt requested), or shall
have delivered such notice to an overnight courier, within the
applicable ten (10) Business Day period (regardless of when, or if,
Borrower shall have received such notice). If Administrative Agent
shall fail so to approve or disapprove any Lease Term Sheet, then
Administrative Agent shall be deemed to have approved such Lease Term
Sheet.
(iv) If Borrower shall desire for the Collateral
Agent to execute an SNDA with respect to a given Lease that shall not
constitute an Automatically Qualified SNDA Lease, then, regardless of
whether Borrower shall have furnished a Lease Term Sheet with respect
to such proposed Lease to the Agents, Borrower shall furnish to the
Agents (A) execution copies of all documents relating to such proposed
Lease to the Agents, together with a blackline of the same against the
relevant lease form approved by the Administrative Agent (in accordance
with the provisions of this Agreement) (collectively, the "Proposed
Lease Documents") and (B) all other information and materials
pertaining to the applicable tenant or proposed tenant and/or the
proposed Lease as the Administrative Agent shall reasonably request.
The Administrative Agent shall not be entitled to disapprove any given
proposed Lease solely on the basis of any provision in the applicable
Proposed Lease Documents that was accurately reflected in the
applicable Lease Term Sheet, if any, approved (or deemed approved) by
the Administrative Agent.
(v) Unless Administrative Agent shall otherwise notify the
Borrower in writing, all documents and materials to be furnished to the
Administrative Agent under this subparagraph (Z) shall be sent or
delivered to the address for the Administrative Agent set forth below,
attention: Steven Mnuchin.
(AA) Estoppel Certificates. Within ten (10) Business Days of the request of any
Agent or any Lender (or, in the case of a third party tenant, twenty (20)
calendar days of the request of any Agent or any Lender), the Borrower shall
deliver an estoppel certificate in form and substance reasonably satisfactory to
such Agent or such Lender, as applicable and, to the extent permitted under the
Leases and obtainable through the use of commercially reasonable efforts,
estoppel certificates from all tenants under then existing Leases which the
Administrative Agent in its discretion designates. Within thirty (30) days of
the request therefor by the Borrower, which request shall be made only if the
Borrower shall have a reasonable basis for requesting the same and shall not be
made more than one time during any six month period, (a) each Lender shall
deliver an estoppel certificate setting forth, to the actual knowledge of the
officer executing such estoppel certificate on behalf of such Lender, (i) the
then outstanding principal amount of the Note(s) held by such Lender as well as
all accrued and unpaid interest thereon and (ii) whether there then exists a
monetary or material non-monetary Event of Default (other than an Event of
Default resulting from the failure to make any payment that, pursuant to the
terms of the Loan Documents, is required to be made to any Agent) and (b) each
Agent shall deliver an estoppel certificate setting forth, to the actual
knowledge of the officer executing such estoppel certificate on behalf of such
Agent, whether there then exists a monetary or material non-monetary Event of
Default (other than an Event of Default resulting from the failure to make any
payment that, pursuant to the terms of the Loan Documents, is required to be
made to any other Agent or any Lender).
(BB) Deed of Trust. At all times (i) the Deed of Trust shall constitute a first
priority Lien (subject only to the Permitted Liens) on the Trust Property and
(ii) the Trust Property shall include, irrevocable parking rights and easements,
and shall be served by utilities, in each case, as is necessary for the
operation, use and enjoyment of the Trust Property as a First Class Mall;
provided that the Trust Property may be subject to the Permitted Encumbrances.
(CC) Property Agreements. (i) Borrower shall not execute, or permit to be
executed, any Property Agreement (other than Service Contracts) or any oral or
written renewal, extension, supplement, amendment, alteration, modification,
supplement or other change to the terms of the Management Agreement, the
Brokerage Agreement, the ESA, the REA, the Sale and Contribution Agreement, the
Trademark Cross License Agreement, the COREA (if entered into), the FADAA, the
Mall Retainage Escrow Agreement or any other Property Agreement (other than a
Service Contract) without the Administrative Agent's prior written consent,
unless, in the case of any Property Agreement other than the Sale and
Contribution Agreement, and/or the Mall Retainage Escrow Agreement (with respect
to which the Administrative Agent's prior written consent shall be required in
all cases), both (x) a Commercially Reasonable Owner would do so and (y) the
execution and performance of such Property Agreement, or of such renewal,
extension, supplement, amendment, alteration, modification, supplement or other
change, is not likely to cause a Material Adverse Effect; provided that, in the
case of the COREA, the foregoing shall be subject to the provisions of Article
VIII hereof. Borrower (1) shall pay when due and before any fine, penalty,
interest or cost may be added thereto for the late payment or non-payment
thereof, all Common Charges and all other amounts that are payable by Borrower
under the Property Agreements (and, notwithstanding any other provision of the
Loan Documents, if Borrower shall fail so to do for ten (10) days after any
Agent gives Borrower notice thereof, the Administrative Agent may (but shall not
be obligated to) pay such Common Charges or other amounts) and Borrower shall
observe and perform all of the other obligations imposed upon Borrower or the
Collateral under each Property Agreement; (2) shall promptly send copies to the
Agents of all notices of default which Borrower shall send or receive
thereunder; (3) to the extent that a Commercially Reasonable Owner would do so
(or if necessary to prevent the occurrence of Material Adverse Effect) shall
enforce all of the material terms, covenants and conditions contained in all
Property Agreements upon the part of all Persons (other than Borrower)
thereunder to be observed or performed, short of termination thereof; (4) shall
not collect any amounts payable to Borrower prior to the date upon which,
pursuant to the express terms of the applicable Property Agreement, such amount
is due and payable; (5) shall not sell, assign, transfer, mortgage, pledge or
otherwise encumber any Property Agreement or any interest under any Property
Agreement (except (A) a transfer of the same to the successor or surviving
Person resulting from a merger or consolidation of Borrower with any other
Person in accordance with, and subject to, the terms, provisions and conditions
of, this Agreement, (B) a transfer of the same to an Affiliate Transferee in
accordance with, and subject to, the terms, provisions and conditions of, this
Agreement, (C) a pledge or collateral assignment of the same to the Collateral
Agent pursuant to any other Loan Document, and (D) a pledge or collateral
assignment of the same to the Junior Lender in accordance with, and subject to,
the terms, provisions and conditions of, this Agreement); (6) shall not (A)
cancel or terminate the Management Agreement (unless such Management Agreement
is, at or prior to the time of such termination, replaced with another
Management Agreement under which an Acceptable Manager is the Manager, which
Acceptable Manager executes and delivers a Manager's Subordination), the
Brokerage Agreement, the ESA, the REA, the Sale and Contribution Agreement, the
Trademark Cross License Agreement, the COREA (if entered into), the FADAA or the
Mall Retainage Escrow Agreement (or permit any cancellation or termination of
the Management Agreement (unless such Management Agreement is, at or prior to
the time of such termination, replaced with another Management Agreement under
which an Acceptable Manager is the Manager, which Acceptable Manager executes
and delivers a Manager's Certificate), the Brokerage Agreement, the ESA, the
REA, the Sale and Contribution Agreement, the Trademark Cross License Agreement,
the COREA (if entered into), the FADAA or the Mall Retainage Escrow Agreement)
or (B) except to extent that a Commercially Reasonable Owner would do so (and
provided that the same is not likely to cause a Material Adverse Effect) cancel
or terminate any other Property Agreement (or permit any cancellation or
termination of any such Property Agreement); (7) shall not take (or refrain from
taking) any action that would effect a merger of the estates and rights of
Borrower under any Property Agreement; (8) with respect to any matter relating
to any Property Agreement as to which Borrower has discretion (e.g., the terms
of any document executed in connection with such Property Agreement, the giving
or withholding of a consent or approval, the location of an easement burdening
or benefiting the Trust Property, or the allocation of any costs payable under
any Property Agreement), shall act as a Commercially Reasonable Owner would act
and in a manner which is not likely to cause a Material Adverse Effect; and (9)
with respect to any instance in which Borrower shall have discretion as to
whether to grant or withhold consent to any assignment of rights or delegation
of duties, Borrower shall not consent to any assignment of rights or delegation
of duties under any Property Agreement (unless a Commercially Reasonable Owner
would do so and the same is not likely to cause a Material Adverse Effect).
Borrower shall, within ten (10) days after demand from the Administrative Agent
(or as soon as possible thereafter using commercially reasonable efforts),
obtain from the other parties to any material Property Agreement (as reasonably
determined by Administrative Agent) and deliver to the Administrative Agent a
duly signed and acknowledged certificate that such Property Agreement is
unmodified and in full force and effect (or, if such Property Document has been
modified, that such Property Document is in full force and effect as so modified
and that there have been no other modifications), stating the dates to which the
Common Charges and other amounts payable thereunder have been paid and stating
whether, to such other parties' best knowledge, Borrower is in compliance with
the terms of such Property Agreement, and, if not, specifying each default or
failure of compliance of which such other parties have knowledge. If, at any
time, any Agent or Lender shall cure any default by Borrower under any Property
Agreement or otherwise exercise any rights or remedies afforded lenders under
any Property Agreement, then any and all expenses incurred by such Agent or
Lender, in good faith, in connection with curing such default or otherwise
exercising such rights or remedies shall be paid by the Borrower to such Agent
or Lender upon demand and until paid shall be secured by the Deed of Trust and
shall bear interest at the Default Rate.
(ii) With respect to any easement that shall be granted to
Borrower or in favor of the Trust Property under any Property Agreement,
promptly after request therefor by the Administrative Agent, Borrower shall
cause to be delivered to the Administrative Agent, an endorsement to the Title
Insurance Policy insuring the Deed of Trust amending such Title Insurance Policy
so that the same insures the Collateral Agent for the benefit of the Lenders
that the Deed of Trust constitutes a first priority Lien on such easement (and
all related rights) (in addition to the rest of the Trust Property) subject only
to the Permitted Liens; provided that the Trust Property may be subject to the
Permitted Encumbrances.
(DD) SUBSTANTIVE NON-CONSOLIDATION OPINION. With respect to
each Affiliate of Borrower that shall incur, otherwise become liable with
respect to and/or mortgage or otherwise encumber its property as collateral for,
any indebtedness for borrowed money in connection with the construction of
improvements at the Phase II Land (as defined in the REA) or any portion thereof
(whether such indebtedness shall be recourse or non-recourse, secured or
non-secured and provided that "take out" financing (i.e. permanent or "mini
perm" financing that refinances construction financing) shall not be deemed to
be in "connection with the construction of improvements" for purposes of this
Section), then Borrower shall cause to be furnished to the Lenders and the
Agents, on the date (the "Opinion Date") upon which such Affiliate incurs such
indebtedness, otherwise becomes so liable and/or so mortgages or otherwise
encumbers its property, a substantive non-consolidation opinion with respect to
the Borrower and such Affiliate, which legal opinion shall be dated as of the
Opinion Date, and shall be in form and substance, and from counsel, reasonably
satisfactory to Administrative Agent.
ARTICLE VI.
NEGATIVE COVENANTS
Section 6.1. Negative Covenants. The Borrower covenants
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and agrees that it shall not do, directly or indirectly (or permit to be done
directly or indirectly), any of the following:
(A) Liens on the Trust Property. Incur, create, assume, become or be liable in
any manner with respect to, or, permit to exist ((x) in the case of a mechanic's
or materialmen's lien or other non-consensual Lien, beyond the thirty (30) day
period provided for in Section 6(e) of the Deed of Trust or (y) in the case of
any deed of trust, mortgage or other consensual Lien, at all), any Lien with
respect to the Collateral, except: (i) Liens in favor of the Collateral Agent
granted pursuant to the Loan Documents, (ii) the Lien of the Junior Loan
Documents and (iii) the Permitted Encumbrances.
(B) Transfer. (i) Own any property other than the Collateral (and any Money or
investments of Money relating to the Borrower's business that is not a portion
of the Collateral) or, except as expressly permitted under subsection 6.1(B)(ii)
below, make, or permit to be made, any Transfer (other than a Permitted
Transfer).
(a)(i)(ii) Borrower shall be permitted to convey and transfer
all (but not less than all) of the Collateral (the "Affiliate Transfer") to an
entity (A) that is authorized and qualified to own real property and to conduct
business in, and is in good standing under the laws of, the State of Nevada (to
the extent required under applicable Legal Requirements), (B) that is controlled
(as defined in the definition of Affiliate) by the Principal (or, in the case of
the death or legal incapacity of the Principal, the applicable Person or Persons
referenced in clause (ii) or (iii), as applicable of the definition of
"Permitted Transfer"), (C) all of the ownership interests of which, and voting
rights with respect to which, are owned by the Persons that are, under the
express terms of this Agreement, permitted to own ownership interests in, and
voting rights with respect to, the Borrower, (D) that is a Single Purpose Entity
and (E) with respect to which, immediately after consummation of the Affiliate
Transfer, all of the representations and warranties contained in the Loan
Documents relating to the Borrower shall be true (with such changes, if any, as
shall result from actions taken by the Borrower in accordance with the
provisions of the Loan Documents or other events that do not constitute
Defaults) (the "Affiliate Transferee"), by giving at least thirty (30) days'
prior written notice to the Administrative Agent of Borrower's intent to do so
(the "Transfer Notice") and upon satisfaction, on or prior to the date upon
which such conveyance and transfer shall occur (the "Affiliate Transfer Date")
of the following conditions:
(a) no Default or Event of Default shall exist on the date
upon which the Transfer Notice is given to the Administrative Agent, immediately
prior to consummation of the Affiliate Transfer, or immediately after
consummation of the Affiliate Transfer and Borrower shall execute and deliver to
the Administrative Agent a Borrower's Certificate, dated as of the Affiliate
Transfer Date, pursuant to which Borrower certifies as to the foregoing;
(b) the Administrative Agent shall have received all of the
following (the form and substance of each of which shall be subject to the
approval of the Administrative Agent (not to be unreasonably withheld or
delayed)): (i) an original fully-executed and acknowledged counterpart of an
assumption agreement, in proper form for recording in the Recorder's Office
containing the assumption, by the Affiliate Transferee of all obligations,
agreements, covenants and liabilities of the Borrower under the Loan Documents
(the "Assumption Agreement"), (ii) an opinion or opinions of counsel reasonably
satisfactory to the Administrative Agent with respect to the Affiliate Transfer,
the Affiliate Transferee, the Assumption Agreement, the continuation of the
Liens created by the Collateral Security Instruments and such other matters as
the Administrative Agent shall reasonably request, (iii) original counterparts
of the documents pursuant to which the Affiliate Transfer is being made (and
copies of all consents and approvals, if any, required to be obtained in
connection with the Affiliate Transfer), (iv) an endorsement to the Title
Insurance Policy insuring the Deed of Trust amending such Title Insurance Policy
to reflect the Affiliate Transfer, which Title Insurance Policy, as so endorsed,
shall continue to insure the Collateral Agent for the benefit of the Lenders
that the Deed of Trust constitutes a first priority Lien on the Trust Property
subject only to the Permitted Liens (provided that the Real Property may be
subject to the Permitted Encumbrances), (v) a written confirmation from the
Principal that the Limited Payment Guaranty, the Scope Change Guaranty and the
Principal Non-Recourse Carve-Out and Limited Environmental Matters Guaranty
remain in full force and effect notwithstanding the consummation of the
Affiliate Transfer and (vi) any other documents or instruments reasonably
required by the Administrative Agent in connection with the Affiliate Transfer;
(c) Borrower shall have caused the Assumption Agreement to be
recorded in the Recorder's Office; and
(d) Borrower shall have paid (i) all reasonable costs and
expenses incurred by the Agents and/or the Lenders in connection with the
Affiliate Transfer, including, without limitation, reasonable attorneys' fees,
disbursements and other expenses and (ii) all other costs and expenses relating
to the Affiliate Transfer.
At the time that Borrower shall make an Affiliate Transfer in
accordance with the terms hereof, if the Affiliate Transferee shall be an entity
other than a Delaware limited liability company, it shall be deemed that each
reference to Borrower being a "limited liability company" or to the Borrower's
"limited liability agreement" or "certificate of formation" (and all other
comparable changes) shall have been changed to reflect the type of entity that
the Affiliate Transferee is.
(C) Adjacent Property Expenses; Other Borrowings. (i) Incur, pay, create,
assume, become or be liable in any manner with respect to Adjacent Property
Expenses or Other Borrowings, except that the Borrower may incur (1) to the
extent that a Commercially Reasonable Owner would incur the same, unsecured
trade indebtedness incurred in the ordinary course of the Borrower's business of
operating the Mall Improvements and which is paid in full on or prior to the
date upon a Commercially Reasonable Owner would pay the same in full (a
"Commercially Reasonable Outside Date") (provided that 120 days after the date
upon which the indebtedness shall have been incurred shall be deemed to be a
Commercially Reasonable Outside Date (unless the Borrower shall be diligently
and in good faith contesting its obligation to pay the same (and a Commercially
Reasonable Owner would do so), in which case, Borrower may delay paying such
indebtedness as long as Borrower is so contesting payment of the same), (2)
Equipment Financings secured by Equipment Liens, obligations under Equipment
Leases and an unsecured working capital facility extended to the Borrower in an
arms-length transaction, in each case, entered into in the ordinary course of
the Borrower's business at the Mall Improvements, provided that the sum of (A)
the maximum aggregate principal amount of such working capital facility plus (B)
the aggregate outstanding principal amount of such Equipment Financings plus (c)
the aggregate amount of the payments provided for under such Equipment Leases
(excluding, with respect to capitalized Equipment Leases, those portions of such
lease payments that would be deemed to constitute non-default interest payments
or transaction costs under the applicable standards of the Financial Accounting
Standards Board) shall be less than $1,000,000, (3) so long as no Event of
Default shall then exist, to the extent that a Commercially Reasonable Owner
would incur the same, unsecured indebtedness solely in respect of reimbursement
obligations incurred in connection with surety and appeal bonds, performance
bonds and other similar obligations, in the course of operating the Trust
Property in accordance with the terms of this Agreement, (4) subject to the
provisions of clause (ii) below and to the provisions of the Junior Loan
Documents, the Junior Loan and (5) subject to the provisions of clause (iii)
below.
(ii) Borrower shall not be entitled to make any payments in
respect of the Junior Loan or under the Junior Loan Documents except as
expressly provided in this subparagraph (ii). Borrower shall be entitled to make
current payments under the Junior Loan, but, in the case of each such current
payment, only to the extent that there was Excess Cash Flow during the Interest
Accrual Period immediately preceding the Interest Accrual Period in which the
Junior Loan payment date in question occurred; provided that (1) at any time
that an Event of Default shall exist, no payments shall be permitted under the
Junior Loan Documents (but interest under the Junior Loan Documents shall, in
all events, be permitted to accrue and compound and the obligation to pay the
same shall be deferred until both (aa) no Event of Default exists and (bb)
Excess Cash Flow is sufficient to pay the same).
(b)(i)(D)Dissolution; Merger or Consolidation. Dissolve,
terminate, liquidate, merge into or consolidate with another Person or permit
any other Person to merge into or consolidate with Borrower. Notwithstanding the
foregoing, Borrower shall be permitted to merge into or consolidate with another
Person (or permit another Person to merge into or consolidate with Borrower)
provided that (i) immediately after giving effect to such merger or
consolidation, (A) the surviving or successor, as applicable, Person shall own
all of the Collateral, (B) such Person shall be authorized and qualified to own
real property and to conduct business in, and be in good standing under the laws
of, the State of Nevada (to the extent required under applicable Legal
Requirements), (C) such Person shall be controlled (as defined in the definition
of Affiliate) by the Principal (or, in the case of the death or legal incapacity
of the Principal, the applicable Person or Persons referenced in clause (ii) or
(iii), as applicable of the definition of "Permitted Transfer"), (D) all of the
ownership interests of, and voting rights with respect to, such Person shall be
owned by the Persons that are, under the express terms of this Agreement,
permitted to own ownership interests in, and voting rights with respect to, the
Borrower, (E) such Person shall be a Single Purpose Entity and (F) all of the
representations and warranties contained in the Loan Documents relating to the
Borrower shall be true (with such changes, if any, as shall result from actions
taken by the Borrower in accordance with the provisions of the Loan Documents or
other events that do not constitute Defaults) (the "Surviving Entity"), (ii)
Borrower shall give to the Administrative Agent at least thirty (30) days' prior
written notice of such merger or consolidation (the "Merger Notice") and (iii)
all of the following conditions shall be satisfied:
(a) no Default or Event of Default shall exist (1) on the date
upon which the Merger Notice is given to the Administrative Agent, (2)
immediately prior to consummation of the merger or consolidation in question, or
(3) immediately after consummation of such merger or consolidation, and Borrower
shall execute and deliver to the Administrative Agent a Borrower's Certificate,
dated as of the date upon which such merger or consolidation shall be
consummated (the "Merger Date"), pursuant to which Borrower certifies as to the
foregoing;
(b) on or prior to the Merger Date, the Administrative Agent
shall have received all of the following (the form and substance of each of
which shall be subject to the approval of the Administrative Agent (not to be
unreasonably withheld or delayed)): (1) an original fully-executed and
acknowledged counterpart of an assumption agreement, in proper form for
recording in the Recorder's Office containing the assumption, by the Surviving
Entity of all obligations, agreements, covenants and liabilities of the Borrower
under the Loan Documents (the "Merger Assumption Agreement"), (2) an opinion or
opinions of counsel reasonably satisfactory to the Administrative Agent with
respect to the such merger or consolidation, the Surviving Entity, the Merger
Assumption Agreement, the continuation of the Liens created by the Collateral
Security Instruments and such other matters as the Administrative Agent shall
reasonably request, (3) copies of the documents pursuant to which such merger or
consolidation is being consummated (and copies of all consents and approvals, if
any, required to be obtained in connection with such merger or consolidation),
(4) an endorsement to the Title Insurance Policy insuring the Deed of Trust
amending such Title Insurance Policy to reflect such merger or consolidation,
which Title Insurance Policy, as so endorsed, shall continue to insure the
Collateral Agent for the benefit of the Lenders that the Deed of Trust
constitutes a first priority Lien on the Trust Property subject only to the
Permitted Liens (provided that the Real Property may be subject to the Permitted
Encumbrances), (5) a written confirmation from the Principal that the Limited
Payment Guaranty, the Scope Change Guaranty and the Principal Non-Recourse
Carve-Out and Limited Environmental Matters Guaranty remain in full force and
effect notwithstanding the consummation of such merger or consolidation and (vi)
any other documents or instruments reasonably required by the Administrative
Agent in connection with such merger or consolidation;
(c) Borrower shall have caused the Merger Assumption Agreement
to be recorded in the Recorder's Office; and
(d) Borrower shall have paid all reasonable costs and expenses
incurred by the Agents and/or the Lenders in connection with such merger or
consolidation, including, without limitation, reasonable attorneys' fees,
disbursements and other expenses.
(E) Change In Business. Cease (or permit Managing Member to
cease) to be a Single-Purpose Entity or undertake or participate in activities
other than Permitted Activities.
(F) Debt Cancellation. Cancel or otherwise forgive or release
(or permit Managing Member to cancel or otherwise forgive or release) any
material claim or debt owed to the Borrower (or Managing Member) by any Person,
except for adequate consideration or in the ordinary course of Borrower's (or,
in the case of Managing Member, Managing Member's) business.
(G) Affiliate Transactions. Enter into, or be a party to (or
permit Managing Member to enter into, or be a party to), any transaction with a
direct or indirect member, shareholder, officer or director or Affiliate of the
Borrower (or Managing Member), except in the ordinary course of business and on
terms which are fully disclosed to the Administrative Agent in advance (or
promptly after the consummation of the transaction) and on terms that are no
less favorable to Borrower (or in the case of Managing Member, Managing Member)
than would be obtained in a comparable arm's length transaction with an
unrelated third party.
(H) Creation of Easements. Except as expressly permitted by or
pursuant to the Deed of Trust or this Agreement, permit the Collateral or any
part thereof to become subject to, any easement, or restrictive covenant, other
than a Permitted Encumbrance.
(I) Misapplication of Funds. Distribute any Moneys or other
funds received from any Bank Account in violation of the provisions of Section
2.12, or misappropriate any security deposit or portion thereof.
(J) Certain Restrictions. Enter into any agreement which
expressly restricts the ability of the Borrower to enter into amendments,
modifications or waivers of any of the Loan Documents.
(K) Assignment of Licenses. Except as otherwise expressly
permitted hereunder, assign or transfer any of its interest in any Permits
pertaining to the Collateral, or assign, transfer or remove or permit any other
Person to assign, transfer or remove any material records pertaining to the
Collateral; provided that the Borrower, in the ordinary course of its business
may transfer or remove such records so long as (x) Borrower shall give notice to
the Administrative Agent of such transfer or removal promptly after such
transfer or removal and (y) the Agents and the Lenders shall have the same
access to such records as they would have had if such records had not been so
removed or transferred.
(L) Place of Business. Change its chief executive office or
its principal place of business without giving the Agents at least 30 days'
prior written notice thereof and promptly providing the Agents such information
as the Agents may reasonably request in connection therewith.
(M) Junior Loan. Borrower shall not (i) except to the extent
expressly permitted in the Junior Loan Subordination Provisions, increase,
renew, restate, replace, supplement, extend, amend or modify any Junior Loan
Document or any indebtedness secured or evidenced by any Junior Loan Document
(the "Junior Indebtedness") (and the total indebtedness secured or evidenced by
the Junior Loan Documents shall not be increased) unless the Administrative
Agent, prior to the effectiveness of any such increase, renewal, restatement,
replacement, supplement, extension, amendment or modification, shall have
executed a written instrument evidencing its consent to such action, (ii)
execute any document securing, evidencing or guarantying any of the Junior
Indebtedness (other than the Junior Loan Documents) or (iii) take any action, or
refrain from taking any action, inconsistent with the Junior Loan Subordination
Provisions.
(N) [Intentionally omitted].
(O) Plans and Welfare Plans. Knowingly engage in or permit any
transaction in connection with which the Borrower or any ERISA Affiliate could
reasonably be expected to be subject to either a material civil penalty or tax
assessed pursuant to Section 502(i) or 502(l) of ERISA or Section 4975 of the
Code, take any action which would permit the assets of the Borrower to become
"plan assets", whether by operation of law or under regulations promulgated
under ERISA or adopt, amend (except as may be required by applicable law) or
increase the amount of any benefit or amount payable under any Plan or Welfare
Plan, except for normal increases in the ordinary course of business that, in
the aggregate, do not result in a material increase in benefits expense.
(P) Subsidiaries. Form or acquire any subsidiaries.
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(Q) Nuisances; Waste; Permitted Encumbrances. Do any act
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or thing that constitutes a public or private nuisance or constitutes waste.
(R) Use of Proceeds. Use any portion of the proceeds of the
Loan for family, personal, agricultural or household use.
(S) Private Offering. In connection with any offer or sale of
any Securities issued in connection with a Securitization, use, or permit any
Person authorized to act on its behalf to use, any form of general solicitation
or general advertising within the meaning of Rule 502(c) under the Securities
Act of 1933, as amended from time to time (the "Securities Act"), including,
without limitation, advertisements, articles, notices or other communications
published in any newspaper, magazine or similar medium or broadcast over
television or radio, or any seminar or meeting whose attendees have been invited
by any general solicitation or general advertising, or with respect to itself or
any Person authorized to act on its behalf, (i) offer or sell, directly or
indirectly, the Securities or any interest in the Securities or any other
security from any Person in any manner, (ii) solicit any offer to buy, or (iii)
take any other action that in each of the cases set forth in clauses (i) through
(iii) above would constitute a distribution of the Securities under the
Securities Act or would render the sale of the Securities a violation under
Section 5 of the Securities Act or any state securities laws, or would require
registration pursuant to the Securities Act, or would require qualification of
any of the Loan Documents under the Trust Indenture Act of 1939.
(T) Interests in Affiliates. Acquire any stock, membership
interests, partnership interests or other securities or interests of any other
Person (other than directly in connection with a merger permitted under this
Agreement).
(U) Renovation of Trust Property. (i) Notwithstanding anything
to the contrary contained in any Loan Document, except as otherwise expressly
permitted under this subsection 6.1(U), Borrower shall not perform or cause to
be performed, consent to or permit, any Renovation (other than a Permitted
Renovation). Furthermore, without the Administrative Agent's prior written
consent, in no event shall any of the Trust Property be demolished or removed
except to the extent that (i) such demolition or removal shall constitute a
Permitted Renovation that shall be performed in connection with, and shall be
incidental to, another Permitted Renovation that consists of construction that
is performed in accordance with the terms, provisions and conditions of the Loan
Documents or (ii) such removal shall consist of the removal of Equipment that is
replaced by other Equipment (the "Replacement Equipment") that shall be (aa)
encumbered by the Deed of Trust, (bb) located at, and used in connection with,
the Trust Property and (cc) have a utility in connection with the operation of
the Borrower's business at the Trust Property in accordance with the provisions
of the Loan Documents that is at least equal to that of the Equipment that was
removed (and a Commercially Reasonable Owner would remove the removed Equipment
and replace it with such Replacement Equipment); provided that such Equipment
need not be replaced by Replacement Equipment to the extent that both (i) a
Commercially Reasonable Owner would determine that neither such Equipment nor
any Replacement Equipment is necessary or desirable in connection with the
operation of the Collateral and (ii) neither such Equipment nor any Replacement
Equipment is necessary or desirable in order to operate the Collateral in
accordance with the terms of the Loan Document.
(ii) If Borrower shall desire to make any Renovation that will
not constitute a Permitted Renovation, then Borrower shall send to the
Administrative Agent a Proposed Renovation Notice, together with all Proposed
Renovation Materials pertaining thereto. If, with respect to a given proposed
Renovation, (A) Administrative Agent shall not approve or disapprove, in
writing, within twenty (20) Business Days after the date upon which the
Administrative Agent shall have actually received the Proposed Renovation Notice
pertaining thereto (without giving effect to the "deemed receipt" provisions of
Section 10.6 hereof), together with all Proposed Renovation Materials pertaining
thereto, such proposed Renovation, then Administrative Agent shall be deemed to
have approved such Proposed Renovation.
(iii) If Administrative Agent shall approve (or shall be
deemed, in accordance with the provisions of this Agreement, to have approved) a
proposed Renovation (other than a Permitted Renovation), then, prior to
commencing such proposed Renovation, Borrower shall submit to the Administrative
Agent a Proposed Plans and Specifications Notice with respect thereto, attached
to which shall be the description of the proposed Renovation that was contained
in the applicable Proposed Renovation Notice, as well as the plans and
specifications relating to such proposed Renovation. If, with respect to a given
proposed Renovation, (A) Administrative Agent shall not approve or disapprove,
in writing, within twenty (20) Business Days after the date upon which the
Administrative Agent shall have actually received the Proposed Plans and
Specifications Notice pertaining thereto (without giving effect to the "deemed
receipt" provisions of Section 10.6 hereof), together with the aforesaid
description and plans and specifications, such plans and specifications, then
Administrative Agent shall be deemed to have approved such plans and
specifications. Administrative Agent shall only be entitled to disapprove such
plans and specifications to the extent the proposed Renovation, as reflected in
such plans and specifications, differs, in any material respect, from the
proposed Renovation, as described in the applicable Proposed Renovation Notice.
Administrative Agent's review of plans and specifications in connection with
Renovations or proposed Renovations shall create no responsibility or liability
on behalf of the Administrative Agent or any Lender for their completeness,
design, sufficiency or their compliance with Legal Requirements or Insurance
Requirements. Borrower shall not be required to obtain the Administrative
Agent's approval of plans and specifications pertaining to Permitted Renovations
(other than a Permitted Mall Expansion (which is addressed by Article VIII))
performed in accordance with the provisions of the Loan Documents.
ARTICLE VII.
DEFAULTS
Section 7.1. Event of Default. The occurrence of one or
----------------
more of the following events shall be an "Event of Default" hereunder:
----------------
(i) if the Borrower shall fail to pay, when due in
accordance with the terms of the Loan Documents, any accrued and unpaid
interest and such failure shall continue for one (1) Business Day after
the due date therefor;
(ii) if the Borrower shall fail to pay all of the
then outstanding Indebtedness on the Maturity Date;
(iii) subject to the provisions of Section 23 of the
Deed of Trust, if any of the Impositions are not paid prior to the date
that occurs ten (10) days after notice from the Administrative Agent,
any Governmental Authority or any other Person entitled to payment
thereof that the same are delinquent (provided that Borrower shall not
be deemed to be in Default for its failure to pay those Impositions
that (x) prior to the Assessment Date, the Trustee shall be required to
pay out of Money then on deposit in the REA Tax Escrow Account or (y)
from and after the Assessment Date, the Collateral Agent shall be
required to pay out of Money then on deposit in the Tax Escrow
Account);
(iv) if (A) Borrower shall fail to maintain in full
force and effect any insurance that Borrower is required to maintain
hereunder and any such failure shall continue for ten (10) days after
notice from the Administrative Agent or the applicable insurance
carrier or agent, (B) Borrower shall fail to use diligent and
commercially reasonable efforts to enforce the obligations of any other
REA Owner to maintain the insurance that such REA Owner is required to
maintain under the REA or (to the extent permitted under the REA) to
otherwise perform and satisfy the obligations of the such other REA
Owner under the provisions of the REA relating to insurance and such
failure shall continue for ten (10) days after notice thereof from
Administrative Agent to Borrower or (C) any of the Insurance Policies
that are required to be delivered to the Administrative Agent or the
Collateral Agent under the terms of the Loan Documents are not
delivered to the Collateral Agent within ten (10) days of request
therefor by the Administrative Agent (which request shall state that
failure so to deliver such Insurance Policies shall constitute an Event
of Default);
(v) if Borrower shall fail to observe, perform or
satisfy, or there shall be a violation or breach of, any of the
monetary terms, provisions, agreements, covenants or conditions
contained in Section 2.12 which failure shall continue for ten (10)
days after notice therefor by the Administrative Agent to Borrower;
(vi) if the Billboard Master Lease, the Lutece Master
Lease or the Canyon Ranch Master Lease shall terminate, or be
terminated, prior to its stated expiration date or be surrendered by
the Borrower without the prior written consent of the Administrative
Agent, or if the Borrower or the lessor under the Billboard Master
Lease, the Lutece Mater Lease or the Canyon Ranch Master Lease shall be
in default under the Billboard Master Lease, the Lutece Master Lease or
the Canyon Ranch Master Lease, as applicable (after the giving of any
required notice and the expiration of any applicable cure period);
(vii) if the ESA, the REA, the Sale and Contribution
Agreement, the COREA (if entered into), the FADAA, the Trademark Cross
License Agreement or the Mall Retainage Escrow Agreement shall
terminate, or be terminated or canceled, prior to its stated expiration
date or if Borrower shall be in default (after the giving of any
applicable notice and the expiration of any applicable grace period) or
any Affiliate of the Borrower shall be in monetary default or material
non-monetary default (after the giving of any applicable notice and the
expiration of any applicable grace period) under the ESA, the REA, the
Sale and Contribution Agreement, the Trademark Cross License Agreement,
the COREA (if entered into), the FADAA or the Mall Retainage Escrow
Agreement, and, only with respect to a default by an Affiliate of the
Borrower, such default may reasonably be expected to cause a Material
Adverse Effect;
(viii) if the Borrower shall fail to pay any other
amount payable pursuant to this Agreement or any other Loan Document
when due and payable in accordance with the provisions hereof or
thereof, as the case may be, and such failure continues for ten (10)
days after Administrative Agent delivers written notice thereof to the
Borrower;
(ix)(A) if, for any period of fifteen (15)
consecutive days, there shall not be a valid and subsisting Mall
Certificate of Occupancy (as defined in the FADAA) in full force and
effect or (B) if Borrower shall not use its commercially reasonable
efforts to obtain before February 7, 2000, a valid and subsisting
Permanent Mall Certificate of Occupancy;
(x) if any representation or warranty made by
Borrower or the Principal herein or in any other Loan Document, or in
any certificate, financial statement or other instrument, agreement or
document furnished in connection with this Agreement, any Note or any
other Loan Document, shall be false in any material respect as of the
date such representation or warranty was made (or deemed made);
provided that, if such representation or warranty (A) was made without
the Borrower or the Principal either knowing that it was false (in
whole or part) and (B) such breach is susceptible of cure by the
Borrower, then such breach shall not constitute an Event of Default
unless Borrower shall fail to cure such breach within thirty (30) days
after notice thereof from the Administrative Agent to the Borrower
(unless (aa) such breach also constitutes a default that is covered by
subsection 7.1(xxiii) hereof, (bb) such breach is susceptible of cure
but cannot reasonably be cured within such thirty (30)-day period and
(cc) the Borrower shall have commenced to cure such default within such
thirty (30)-day period and thereafter diligently and expeditiously
proceeds to cure the same, in which case such 30-day period shall be
extended to the extent necessary so to cure such default (but in no
event beyond one hundred eighty (180) days in total (including the
original 30-day period));
(xi) if Borrower shall fail to observe, satisfy or
perform, or there shall be a violation or breach of, any of the terms,
provisions, agreements, covenants or conditions contained in
subsections 5.1 (V) or if the amendments to the organizational
documents for Junior Lender that have been approved by Syndication
Agent are not filed in the appropriate governmental offices by December
31, 1999;
(xii) if Borrower shall fail to observe, satisfy or
perform, or there shall be a violation or breach of, any of the terms,
provisions, agreements, covenants or conditions contained in
subsections 6.1(A), (B), (D), (H) and/or (L) or if Borrower or Junior
Lender shall fail to observe, satisfy or perform, or if there shall be
a violation or breach, in any material respect, of any of the terms,
provisions, agreements, covenants or conditions contained, in Section
2.9 hereof;
(xiii) if the Borrower, the Principal or any member
of Borrower makes a general assignment for the benefit of creditors or
admits in writing its inability to pay its debts generally as they
become due;
(xiv) if a receiver, liquidator or trustee shall be
appointed for the Borrower, any member of Borrower or the Principal, or
if the Borrower, any member of Borrower or the Principal shall be
adjudicated a bankrupt or insolvent, or if any petition for bankruptcy,
insolvency, reorganization or arrangement pursuant to federal
bankruptcy or insolvency law, or any similar federal or state law,
shall be filed by or against, consented to, or acquiesced in by, the
Borrower, any member of Borrower or the Principal or if any proceeding
for the dissolution or liquidation of the Borrower, any member of
Borrower or the Principal shall be instituted, if (and only if) such
appointment, adjudication, petition or proceeding was involuntary and
not consented to by the Borrower, any member of Borrower or the
Principal, upon the same not being discharged, stayed or dismissed
within ninety (90) days, or if the Borrower, any member of Borrower or
the Principal shall generally not be paying its debts as they become
due;
(xv) if the Borrower attempts to delegate its
obligations or assign its rights under this Agreement, any of the other
Loan Documents or any interest herein or therein, and such delegation
or assignment of rights or continues or is not corrected for 10 days
after the Administrative Agent delivers written notice thereof to
Borrower; provided that an Affiliate Transfer or Permitted Transfer
made in accordance with the provisions of this Agreement shall not
constitute a Default or Event of Default;
(xvi) if the Borrower or the Managing Member shall no
longer be a Single-Purpose Entity and/or the Borrower or any member in
Borrower shall no longer be a duly formed and validly existing entity
of the type required under this Agreement;
(xvii) if any Loan Document shall cease to be in full
force and effect or if any party thereto (other than any Agent or any
Lender) shall repudiate any Loan Document or any provision, term or
condition thereof (in whole or in part) or allege the same in writing;
(xviii) if the Borrower shall be in monetary or
material non-monetary default beyond any notice or grace period, if
any, (i) under any other mortgage, deed of trust or other Lien
(including, without limitation, any deed of trust securing the Junior
Loan) without regard to its priority relative to the Deed of Trust
and/or (ii) under any document, instrument or certificate relating to
any such mortgage, deed of trust or other Lien or relating to any
indebtedness (including, without limitation, any Junior Loan Document);
provided that, solely with respect to unsecured indebtedness, Equipment
Leases and Equipment Financings, monetary or material non-monetary
defaults with respect thereto shall not constitute an Event of Default
hereunder unless (x) the aggregate principal amount of all such
indebtedness and obligations with respect to the same shall exceed
$750,000 and (y) the holder(s) of unsecured indebtedness, Equipment
Leases and/or Equipment Financings, as applicable, shall have commenced
the taking of Enforcement Action (as defined in the Junior Loan
Subordination Provisions) with respect thereto; provided further that,
an event of default under the Junior Loan Documents shall not
constitute an Event of Default hereunder so long as both the Junior
Lender and Borrower shall be in compliance with the terms, provisions
and conditions of this Agreement and of the Junior Loan Transfer
Restrictions and the Junior Loan Subordination Provisions (including,
without limitation, the Junior Lender's covenant not to take any
Enforcement Action (as defined in the Junior Loan Subordination
Provisions);
(xix) if one or more judgments or decrees shall be
entered against the Borrower involving in the aggregate a liability
(not fully covered by insurance maintained by Borrower) of $250,000 or
more and all such judgments or decrees shall not have been vacated,
discharged, stayed or bonded pending appeal within 60 days from the
entry thereof;
(xx) if the Borrower consummates a transaction which
would cause any Agent's or any Lender's rights under this Agreement,
any Note or any other Loan Document to constitute a non-exempt
prohibited transaction under ERISA or result in a violation of a state
or local statute regulating government plans subjecting any Agent or
any Lender to material liability for a violation of ERISA or a state or
local statute;
(xxi) any event or condition shall occur or exist
with respect to any Plan or Multiemployer Plan concerning which the
Borrower is under an obligation to furnish a report to the
Administrative Agent in accordance with Section 5.1(V) hereof and as a
result of such event or condition, together with all other such events
or conditions, the Borrower or any ERISA Affiliate has incurred or in
the opinion of the Administrative Agent is reasonably likely to incur a
liability to a Plan, a Multiemployer Plan, the PBGC, or a Section 4042
trustee (or any combination of the foregoing) that is reasonably likely
to cause a Material Adverse Effect;
(xxii) without limiting the generality of Section
6(e) of the Deed of Trust, if Borrower shall fail to comply with the
provisions of Section 6(e) of the Deed of Trust with respect to the
mechanics" liens and other similar liens, if any, listed in the Title
Insurance Policy;
(xxiii) if Managing Member shall not be the sole
managing member of Borrower (i) on the Closing Date (immediately after
the funding of the Loan) and/or (ii) at any time thereafter (except as
otherwise permitted under the express terms of this Agreement);
(xxiv) if the Borrower shall fail to observe, satisfy
or perform, or there shall be a violation or breach of, any of the
other terms, provisions, agreement, covenants or conditions of this
Agreement, any Note, the Deed of Trust or any other Loan Document, for
thirty (30) days after notice from the Administrative Agent; provided,
however, that if such default is susceptible of cure but cannot
reasonably be cured within such thirty (30)-day period and the Borrower
shall have commenced to cure such default within such thirty (30)-day
period and thereafter diligently and expeditiously proceeds to cure the
same, such 30-day period shall be extended to the extent necessary so
to cure such default (but in no event beyond one hundred eighty (180)
days in total (including the original 30-day period)); provided
further, that any default that can be cured solely by the payment of
money shall be cured within ten (10) days after notice from the
Administrative Agent;
then, upon the occurrence of any Event of Default the
provisions of Section 7.2 shall apply.
Section 7.2. Remedies. Upon the occurrence of an Event of
Default, if (i) such Event of Default is an Event of Default specified in
subsection 7.1(xiii) or (xiv), then automatically the Loan (with accrued
interest thereon) and the rest of the Indebtedness shall immediately become due
and payable and (ii) if such Event of Default is any other Event of Default, if
so directed by the Required Lenders in writing, the Administrative Agent (to the
extent the Administrative Agent shall be so directed pursuant to such written
directions), by notice to the Borrower, shall declare the Loan (with accrued
interest thereon) and the rest of the Indebtedness to be immediately due and
payable, whereupon the same shall immediately become due and payable. In
addition, upon the occurrence of an Event of Default, without prejudice to any
other rights, powers, remedies available to any Agent or any Lender against the
Borrower, the Principal and all other Persons under any Loan Documents, or at
law or in equity, the Collateral Agent, in accordance with the written
directions of the Required Lenders, shall enforce any and all Liens including,
without limitation, all rights and interests existing under the Collateral
Security Instruments.
Section 7.3. Remedies Cumulative. The rights, powers and
remedies of the Agents and the Lenders under this Agreement shall be cumulative
and not exclusive of any other right, power or remedy which any Agent or any
Lender may have against the Borrower or any other Person pursuant to this
Agreement or the other Loan Documents, or existing at law or in equity or
otherwise and may be exercised whether or not all or any portion of the
Indebtedness shall become, or shall be declared, due and payable. The Agents and
the Lenders' rights, powers and remedies may be pursued singly, concurrently or
otherwise, at such time and in such order as the Required Lenders may determine
in their or its, as applicable, sole discretion. No delay or omission to
exercise any remedy, right or power accruing upon an Event of Default shall
impair any such remedy, right or power or shall be construed as a waiver
thereof, but any such remedy, right or power may be exercised from time to time
and as often as may be deemed expedient. A waiver of any Default or Event of
Default shall not be construed to be a waiver of any subsequent Default or Event
of Default or to impair any remedy, right or power consequent thereon.
ARTICLE VIII.
RELATIONSHIP BETWEEN TRUST PROPERTY
AND PHASE II OF MALL
Section 8.1. Notice Regarding Construction of Mall Phase II.
If Borrower shall desire for Mall Sub II to construct Mall Phase II and to
connect the same to Mall Phase I, then Borrower shall give notice to the
Administrative Agent of such proposed construction, together with a draft of the
COREA. Prior to commencement of construction of Mall Phase II, a COREA that is
approved by the Administrative Agent must be executed and delivered by Borrower
and Mall Sub II.
Section 8.2. Lender Approval Right with respect to the COREA .
The approval of the Administrative Agent will be required with respect to the
COREA. The Administrative Agent will not unreasonably withhold its approval of
the COREA if, as of the date upon which the parties execute the COREA (the "Test
Date"), the Approval Criteria are satisfied. If, as of the Test Date, the
Approval Criteria are not satisfied, then (x) the Administrative Agent shall be
entitled to grant or withhold its approval, in its sole discretion, to any
portions or provisions of the COREA relating to the management or leasing of
Phase I Mall and Phase II Mall, (y) without limiting the foregoing, the COREA
shall provide that at any time that an Event of Default shall exist, the
Administrative Agent shall have sole discretion over the appointment of the
property manager for the entire integrated mall and over leasing plans for the
entire integrated mall (such provision, the "Lender Determination Provision")
and (z) Lender will not unreasonably withhold its approval of the remainder of
the COREA; provided that, if the Approval Criteria shall be satisfied as of any
given date that occurs after the Test Date, then, at such time, the Lender
Determination Provision of the COREA shall be deleted. If the Approval Criteria
shall be satisfied, and the parties thereto execute and deliver a COREA, then,
thereafter, Borrower shall be entitled to make such changes to the COREA that a
Commercially Reasonable Owner would make so long as such changes are not likely
to result in a Material Adverse Effect. Borrower shall furnish to Administrative
Agent, promptly upon request therefor by the Administrative Agent made from time
to time, and as a condition precedent to Administrative Agent's obligations
under this Article VIII, all rent information, Leases and information regarding
the creditworthiness of tenants that the Administrative Agent shall reasonably
request to determine whether the Approval Criteria are satisfied. It will also
be a condition precedent to the commencement of construction of Mall Phase II
that the Administrative Agent receive a substantive non-consolidation opinion,
in form and substance, and from counsel, reasonably satisfactory to
Administrative Agent and its counsel, with respect to Mall Sub I, its Affiliates
and Mall Sub II. Administrative Agent must be executed and delivered by Borrower
and Mall Sub II.
Section 8.3. Design Materials . Promptly upon request therefor
by the Administrative Agent, Borrower shall furnish to the Administrative Agent
such materials as the Administrative Agent shall reasonably require to determine
whether the requirements regarding design of the Phase I Mall and the Phase II
Mall set forth in the Approved COREA will be satisfied. If such materials
disclose that such design requirements will not be satisfied, then Borrower
shall cause such changes to be made as are necessary so that the design of the
Phase I Mall and the Phase II Mall will satisfy such requirements. The
Administrative Agent's review of such materials shall create no responsibility
or liability on behalf of the Administrative Agent or any Lender for their
completeness, design, sufficiency or their compliance with Legal Requirements or
Insurance Requirements.
ARTICLE IX.
THE AGENTS
Section 9.1. Appointment and Authorization of the Agents. Each
Lender hereby appoints and designates Scotiabank, as Administrative Agent,
Scotiabank, as Collateral Agent, and GSMC, as Syndication Agent, each Lender
hereby authorizes each such Agent to take such action on its behalf under the
provisions of this Agreement and the other Loan Documents and to exercise such
powers and perform such duties as are expressly delegated to it by the terms of
this Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto and, to the extent such consent is required under
this Agreement, the Borrower hereby consents to the appointment of each such
Agent. The Syndication Agent shall have no responsibilities or obligations
except as expressly provided in the Loan Documents.
Section 9.2. Agents and their Affiliates. GSMC and Scotiabank
(and each other Person that may hereafter serve as an Agent), and each of their
respective Affiliates, may make loans to, issue letters of credit for the
account of, accept deposits from, acquire equity interests in and generally
engage in any kind of banking, trust, financial advisory, or other business
with, Borrower, the Principal and/or their respective Affiliates as though GSMC
or Scotiabank (or such other Person) were not an Agent hereunder and without
notice to or consent of the Lenders. The Lenders acknowledge that pursuant to
such activities, GSMC Scotiabank, such other Person and/or their respective
Affiliates may receive information regarding Borrower, the Principal and their
respective Affiliates (including information that may be subject to
confidentiality obligations in favor of Borrower, the Principal and/or such
Affiliates) and that GSMC Scotiabank or any such other Person may be deemed to
be an Affiliate of Borrower, the Principal and/or any Affiliate of either, and
acknowledge that GSMC, Scotiabank and their respective Affiliates shall be under
no obligation to provide such information to the Lenders. With respect to the
Loan Advance(s) made by it, GSMC and Scotiabank (and any other Lender that may
hereafter serve as an Agent) shall have the same rights and powers under this
Agreement as any other Lender and may exercise or refrain from exercising the
same as though each of them were not an Agent, and the terms "Lender" and
"Lenders" shall include GSMC and Scotiabank (and any other Lender that may
hereafter serve as an Agent), in its individual capacity.
Section 9.3. Consultation with Experts. Each Agent may consult
with legal counsel, independent public accountants and other experts selected by
it and shall not be liable for any action taken or omitted to be taken by it in
good faith in accordance with the advice of such counsel, accountants or
experts. If any Person shall be both an "Agent" and a "Lender" hereunder, then
nothing contained in this Article IX shall be deemed to constitute a waiver of
the rights, if any, that Borrower has against such Person in its capacity as
"Lender" under this Agreement.
Section 9.4. Liability of Agent. Neither any Agent nor any of
its partners nor Affiliates nor any of their respective directors, shareholders,
members, officers, agents or employees (collectively, "Agent Parties") shall be
liable for any action taken or not taken by it in connection herewith (i) with
the consent or at the request of the Required Lenders in situations in which,
pursuant to the terms of the Loan Documents, such Agent Party is required to act
(or to refrain from acting) in accordance with the consent or at the request of
the Required Lenders (or, when expressly required hereby, such different number
of Lenders required to consent to or request such action or inaction) or (ii) in
the absence of its own gross negligence or willful misconduct. Neither any Agent
nor any of its Agent Parties shall be responsible for or have any duty to
ascertain, inquire into or verify (i) any statement, warranty or representation
made in connection with this Agreement or any borrowing hereunder; (ii) the
performance or observance of any of the covenants or agreements of any Person
(other than such Agent); (iii) the satisfaction of any condition to the making
of any Loan Advance, except receipt of items required to be delivered to such
Agent; or (iv) the validity, effectiveness, enforceability or genuineness of
this Agreement, the Notes or any other Loan Document or other writing furnished
in connection herewith. No Agent shall incur any liability by acting in reliance
upon any notice, consent, certificate, statement, or other writing (which may be
a Lender wire, telex, facsimile transmission or similar writing) believed by it
to be genuine or to be signed by the proper party or parties. Without limiting
the generality of the foregoing, the use of the term "agent" in this Agreement
with reference to any Agent is not intended to connote any fiduciary or other
implied (or express) obligations arising under agency doctrine of any applicable
law. Instead, such term is used merely as a matter of market custom and is
intended to create or reflect only an administrative relationship between
independent contracting parties. Each Agent shall be fully justified in failing
or refusing to take any action under this Agreement or any other Loan Document
unless it shall first be indemnified to its satisfaction by the Lenders against
any and all liability and expense that may be incurred by it or any other of its
Agent Parties by reason of taking or continuing to take any action. Each Agent
shall in all cases be fully protected in acting, or in refraining from acting,
under this Agreement and the other Loan Documents and any action taken or
failure to act pursuant hereto or thereto shall be binding upon all the Lenders
and all future holders of the Notes. If any Person shall be both an "Agent" and
a "Lender" hereunder, then nothing contained in this Article IX shall be deemed
to constitute a waiver of the rights, if any, that Borrower has against such
Person in its capacity as "Lender" under this Agreement.
Section 9.5. Notice of Default; Action after Default or Event
of Default. (a) No Agent shall be deemed to have any knowledge or notice of the
occurrence of any Default or Event of Default, except that the Administrative
Agent shall be deemed to have such knowledge or notice (i) with respect to
defaults in the payment of principal, interest and fees required to be paid to
the Administrative Agent for the account of the Lenders and (ii) if the
Administrative Agent shall have received notice from any other Agent, any
Lender, Borrower or the Principal referring to the applicable Loan Document,
describing such Default or Event of Default and stating that such notice is a
"notice of default" (and the Collateral Agent shall be deemed to have such
knowledge if so informed by the Administrative Agent). If the Administrative
Agent receives such notice, the Administrative Agent shall promptly give such
notice to the other Agents and to the Lenders. The Administrative Agent and the
Collateral Agent shall take (or refrain from taking) such action with respect to
each Default or Event of Default as shall be requested, in writing, by the
Required Lenders. Notwithstanding anything to the contrary contained in any Loan
Document, if any term or provision of any Loan Document shall provide that an
Agent shall be required or permitted to take any action (or to refrain from
taking any action) "at the direction of the Required Lender" or "in accordance
with the instructions of the Required Lenders" (or other comparable language),
then it shall be deemed that the phrase in question reads "at the written
direction of the Required Lenders" or "in accordance with the written
instructions of the Required Lenders" (or other comparable language).
(a)(b) No Lender (in its capacity as Lender) shall take any
enforcement action against the Borrower, the Principal or any collateral
securing the Indebtedness (including, without limitation, the Trust Property) or
any portion thereof or exercise any of the other rights or remedies available to
such Lender under the Loan Documents or otherwise available to such Lender in
connection with the Loan at law or in equity without first obtaining the prior
written consent of the Required Lenders. The provisions of the immediately
preceding sentence shall be enforceable solely by the Lenders and the Agents and
shall not be enforceable by the Borrower, the Principal, any Affiliate of either
or any other Person (other than the Lenders and the Agents).
Section 9.6. Delegation of Duties. Notwithstanding anything to
the contrary contained herein, each Agent (a) may execute any of its duties
under the Loan Documents by or through agents, employees or attorneys-in-fact
and shall be entitled to advice of counsel concerning all matters pertaining to
such duties and (b) shall not be responsible for the negligence or misconduct of
any agents or attorneys-in-fact selected by it with reasonable care; provided
that, with respect to any Person that is proposed to be an agent referred to in
this Section 9.6, if no Event of Default shall then exist, (i) unless such
proposed agent shall be a Lender, an affiliate of GS&Co. or a Qualified Bank,
such proposed agent shall be subject to the Borrower's consent (not to be
unreasonably withheld or delayed) and (ii) if, at the time of the appointment of
any such proposed agent, such proposed agent shall be a Competitor, then,
without the Borrower's consent, such Competitor shall not be permitted to serve
as an agent under this Section 9.6; provided that the Lenders and the Agents
shall be entitled to rely on a written statement from such a proposed agent that
it is not a Competitor (without making any further inquiry or investigation) and
no Lender and no Agent shall be liable to the Borrower or to any other Person if
such an agent shall in fact be a Competitor notwithstanding the fact that such
agent delivered such a written statement.
Section 9.7. Indemnification. Each Lender shall, ratably in
accordance with the principal amount of its Note, indemnify each Agent and its
Agent Parties (to the extent not reimbursed by the Borrower and without limiting
any obligation of Borrower to do so) against any cost, expense (including
reasonable counsel fees, expenses and disbursements), claims, demands, damages,
penalties, actions, judgments, suits, actions, losses and liability (except to
the extent the same results solely from such indemnitee's gross negligence or
willful misconduct) that any such indemnitee may suffer or incur, or that may be
imposed upon or asserted against any such indemnitee, in connection with, or in
any way relating to or arising out of, this Agreement, any other Loan Document
or any documents, information or certificates contemplated by or referred to
herein or therein or the transactions contemplated hereby or thereby or any
action taken or omitted by such Agent under or in connection with any of the
foregoing. Without limitation of the foregoing, each Lender shall reimburse each
Agent upon demand (to the extent such Agent is not reimbursed upon demand by
Borrower, unless such Agent is legally restricted from making such demand upon
Borrower), in which case such Agent shall not be required to make such demand
upon Borrower) for its ratable share of any expenses (including, without
limitation, reasonable attorneys' fees and expenses, excluding the allocated
fees of in-house counsel) incurred by such Agent in connection with the
preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under this, any other
Loan Document, or any document contemplated by or referred to herein to the
extent that such Agent is not reimbursed for such expenses by the Borrower.
Without limiting the generality of the foregoing, if the Internal Revenue
Service or any authority of the United States or other jurisdiction asserts a
claim that any Agent did not properly withhold tax from amounts paid to or for
the account of a Lender (because the appropriate form was not delivered or was
not properly executed, or because such Lender failed to notify such Agent of a
change in circumstances which rendered the exemption from, or reduction of,
withholding tax ineffective, or for any other reason), such Lender shall
indemnify such Agent fully for all amounts paid, directly or indirectly, by such
Agent as tax or otherwise, including penalties and interest, and including any
taxes imposed by any jurisdiction on the amounts payable to such Agent under
this Section, together with all costs, expenses and reasonable attorneys' fees
(including allocated costs for in-house legal services). This subsection, and
the Lenders' obligations under this Section, shall survive the payment of the
Notes and all other amounts payable under the Loan Documents.
Section 9.8. Non-Reliance on Agent and Other Lenders. (a) Each
Lender acknowledges that it has, independently and without reliance upon any
Agent or any other Lender, and based on such documents and information as it has
deemed appropriate, made its own credit analysis and its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of Borrower, the Principal and their respective
Affiliates and its own decision to enter into this Agreement. Each Lender
further acknowledges and agrees that no Lender or Agent has made any
representation or warranty in connection with, and no Lender or Agent assumes
any responsibility with respect to (i) the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Loan Commitment Letter,
the Tri-Party Agreement (as defined in the Loan Commitment Letter), this
Agreement, any other Loan Document or any other instrument, document, material
or information furnished in connection herewith or therewith, (ii) any
statements, warranties or representations made in or in connection with the Loan
Commitment Letter, the Tri-Party Agreement, this Agreement, any other Loan
Documents or any other instrument, document, material or information furnished
in connection herewith or therewith, or (iii) the solvency, financial condition,
financial statements or projections of the Borrower, the Principal or any other
Person or the performance or observance by the Borrower, the Principal or any
other Person of any of its obligations under the Loan Commitment Letter, the
Tri-Party Agreement, this Agreement, any other Loan Document, or any other
instrument, document, material or information furnished in connection herewith
and therewith. Each Lender also acknowledges that it will, independently and
without reliance upon any Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit decisions and to make such appraisals and investigations as it deems
necessary to inform itself as to the business, operations, property, financial
and other condition and creditworthiness of the Principal, the Borrower and
their respective Affiliates, in taking or not taking any action under any Loan
Document or otherwise in connection with the Loan. Each Agent agrees promptly to
furnish to each Lender copies of all financial statements and other
certificates, reports, papers, documents and Notices received by it under the
Loan Documents in its capacity as Agent; provided that if any Loan Document
shall provide for copies of any of the foregoing to be furnished both to the
Syndication Agent and to any other Agent or Agents, then only such other
Agent(s), and not the Syndication Agent, shall be required to furnish the same
to the Lenders. Except as otherwise provided in the immediately preceding
sentence and except for financial statements and other certificates, reports,
papers, documents and Notices, if any, expressly required to be furnished to the
Lenders by any Agent hereunder, no Agent shall have any duty or responsibility
to provide any Lender with any credit or other information concerning the
business, operations, property, condition (financial or otherwise), prospects or
creditworthiness of Borrower, the Principal or any of their Affiliates.
(a)For purposes of determining compliance with the conditions
specified in Article III hereof, with respect to each Loan Advance requested by
the Borrower in accordance with the terms hereof, each Lender that has executed
this Agreement or that becomes a Lender after the Closing Date shall be deemed,
by execution of this Agreement or by so becoming a Lender, as the case may be,
to have consented to, approved, accepted and be satisfied with each document or
other matter required thereunder, if any, required to be consented to or
approved by or acceptable or satisfactory to such Lender as a condition
precedent to such Loan Advance, unless an officer of the Administrative Agent
responsible for the transactions contemplated by the Loan Documents shall have
received notice from such Lender prior to the applicable Borrowing Date
specifying its objection thereto and either such objection shall not have been
withdrawn by notice to the Administrative Agent to that effect or such Lender
shall not have made available to the Administrative Agent such Lender's ratable
portion of such Loan Advance.
Section 9.9. Successor Agents. Each of the Administrative
Agent and the Collateral Agent may be removed by the Required Lenders with or
without cause upon thirty (30) days' prior notice to the Lenders and to the
Agents, and any Agent may resign from the performance of all of its duties and
responsibilities under the Loan Documents upon thirty (30) days' prior notice to
the Lenders, the other Agents and Borrower. Upon the giving of either such
notice, the Required Lenders shall appoint a successor Administrative Agent,
Syndication Agent or Collateral Agent, as the case may be, for the Lenders. Each
of the Agents and the Lenders further acknowledges that Paragraph 5(a) of that
certain Co-Lender and Retained Interest Agreement dated as of the date hereof by
and among (a) GSMC, in its capacity as Syndication Agent under the Loan
Documents, (b) Scotiabank, (i) in its capacity as Administrative Agent under the
Loan Documents and (ii) in its capacity as Collateral Agent under the Loan
Documents, (c) the Lenders from time to time parties hereto and (d) GSMC, in its
capacity as the holder of the Strip (as defined therein) contains an additional
provision regarding the removal of the Collateral Agent and/or the
Administrative Agent by the certain of the Lenders. If, in the case of the
resignation of an Agent, no successor Administrative Agent, Syndication Agent or
Collateral Agent, as the case may be, is appointed prior to the effective date
of the resignation of such retiring Agent, the retiring Agent shall appoint,
after consulting with the Lenders, a successor Agent in such capacity. Upon the
acceptance of its appointment as successor Agent in such capacity hereunder, a
successor Agent shall succeed to all the rights, powers and duties of the
retiring or removed Agent in such capacity, and the term "Administrative Agent",
"Syndication Agent" or "Collateral Agent", as the case may be, shall mean such
successor Administrative Agent, Syndication Agent or Collateral Agent, as the
case may be, and the retiring or removed Agent's rights, powers and duties as
Agent in such capacity shall be terminated. The provisions of this Article IX
shall continue to inure to the benefit of the Agent that has resigned or been
removed as to any actions taken or omitted to be taken by it while it was an
Agent under this Agreement. If no successor Agent has accepted appointment as
Agent in the applicable capacity by the date that is thirty (30) days following
a retiring Agent's notice of resignation or receipt of notice of removal, the
retiring Agent's resignation or removal shall nevertheless be effective and the
Lenders shall perform all of the duties of such Agent hereunder until such time,
if any, as the Required Lenders appoint a successor Agent in such capacity as
provided above. Notwithstanding the foregoing, if no Event of Default shall then
exist, (i) unless a successor Agent shall be a Lender, an affiliate of GS&Co. or
a Qualified Bank, each successor Agent shall be subject to the Borrower's
consent (not to be unreasonably withheld or delayed) and (ii) if, at the time of
the appointment of any proposed successor Agent, such proposed successor Agent
shall be a Competitor, then, without the Borrower's consent, such Competitor
shall not be permitted to serve as such successor Agent; provided that the
Lenders and the Agents shall be entitled to rely on a written statement from a
proposed successor Agent that it is not a Competitor (without making any further
inquiry or investigation) and no Lender and no Agent shall be liable to the
Borrower or to any other Person if an successor Agent shall in fact be a
Competitor notwithstanding the fact that such successor Agent delivered such a
written statement.
Section 9.10. Standard of Care of the Collateral Agent etc.
(a) The Collateral Agent agrees for the benefit of the Lenders that it will hold
the Collateral Security Instruments as custodian and shall handle the Collateral
Security Instruments in accordance with Accepted Practices and the provisions of
this Agreement.
(a)(b) The Collateral Agent shall not be required to take any
discretionary actions hereunder except at the written direction of an Agent or
the Required Lenders. The Collateral Agent shall not be under any obligation or
duty to perform any act which, in the Collateral Agent's reasonable judgment,
could cause it to incur expense or liability or to institute or defend any suit
in respect thereof, or to advance any of its own monies, unless the
Administrative Agent, one or more of the Lenders, or the Borrower, as the case
may be, shall have offered to the Collateral Agent reasonable security or
indemnity against such expense, liability, suit or advance.
(c) Without duplication of amounts payable to the Collateral
Agent under Section 5.1 (J) hereof, Borrower and the Lenders shall indemnify and
hold the Collateral Agent, and its agents, employees, officers, directors,
attorneys and Affiliates harmless from and against any loss, cost or damage
(including, without limitation, reasonable attorneys' fees and disbursements)
incurred by the Collateral Agent in connection with the transactions
contemplated hereby, excluding any loss, cost or damage arising as a result of
the Collateral Agent's failure to adopt and follow Accepted Practices, gross
negligence, fraud, bad faith, willful misconduct or violation of applicable law.
The indemnification set forth in this Section 9.10 shall survive the
satisfaction and payment of the Indebtedness and the termination of this
Agreement.
(d) The Collateral Agent may deem and treat the payees of the
Notes as the owners thereof for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed with the
Collateral Agent.
Section 9.11. Agents' Fees. In addition to all other
Transaction Costs payable under this Agreement, the Borrower shall pay to the
Administrative Agent for its own account, the amounts and at the times set forth
in that certain letter agreement dated November 29, 1999 among Scotiabank, GSMC
and Borrower.
Section 9.12. Lender Commitment Letters. The provisions of
this Article 9 are in addition to, and do not supersede, any acknowledgments and
waivers of the applicable Lender contained in the commitment letter, if any,
delivered by any Lender pursuant to that certain Confidential Offering
Memorandum dated November 1999 furnished by GSMC with respect to a $105 Million
Floating-Rate Senior Loan to Grand Canal Shops Mall, LLC Secured by a First
Mortgage Lien in The Grand Canal Shoppes (each a "Co-Lender Commitment Letter"),
which acknowledgments and waivers shall survive the Closing and the Assignment,
if any, to such Lender. Furthermore, the other provisions, if any, of the
Co-Lender Commitment Letter from Scotiabank to GSMC that, by the terms thereof,
are to be performed after the Closing, shall survive the Closing for the period
specified in such Co-Lender Commitment Letter.
ARTICLE X.
MISCELLANEOUS
Section 10.1. Survival. All covenants, agreements,
representations and warranties made herein and in the certificates delivered
pursuant hereto shall survive the execution and delivery of this Agreement, the
making by the Lenders of the Loan hereunder and the execution and delivery by
the Borrower to the Lenders of the Notes. Whenever in this Agreement any of the
parties hereto is referred to, such reference shall be deemed to include the
successors and assigns of such party. All covenants, promises and agreements in
this Agreement contained, by or on behalf of the Borrower, shall inure to the
benefit of the respective successors and assigns of the Agents and the Lenders.
Nothing in this Agreement or in any other Loan Document, express or implied,
shall give to any Person other than the parties and the holder of any Note, the
Deed of Trust and the other Loan Documents, and their legal representatives,
successors and assigns, any benefit or any legal or equitable right, remedy or
claim hereunder.
Section 10.2. Lender's Discretion. Whenever pursuant to this
Agreement, any Agent or any Lender exercises any right given to it to approve or
disapprove (or consent or withhold consent), or any arrangement or term is to be
satisfactory to any Agent or any Lender, the decision of such Agent or such
Lender, as applicable, to approve or disapprove (or consent or withhold consent)
or to decide whether arrangements or terms are satisfactory or not satisfactory
shall (except as is otherwise specifically herein provided) be in the sole
discretion of such Agent or such Lender, as applicable, and shall be final and
conclusive.
Section 10.3. Governing Law. (a) This Agreement was negotiated
in New York, and made by the Agents and the Lenders initially named herein and
accepted by the Borrower in the State of New York, and the proceeds of the Notes
delivered pursuant hereto were disbursed from New York, which State the parties
agree has a substantial relationship to the parties and to the underlying
transaction embodied hereby, and in all respects (including, without limitation,
matters of construction, validity and performance), this Agreement and the
obligations arising hereunder shall be governed by, and construed in accordance
with, the laws of the State of New York applicable to contracts made and
performed in such State and any applicable law of the United States of America.
(a)(b) Any legal suit, action or proceeding against any Agent,
any Lender or the Borrower arising out of or relating to this Agreement may be
instituted in any federal or state court in New York, New York. The Borrower
hereby (i) irrevocably waives, to the fullest extent permitted by applicable
law, any objection which it may now or hereafter have to the laying of venue of
any such suit, action or proceeding brought in such a court and any claim that
any such proceeding brought in such a court has been brought in an inconvenient
forum, and (ii) irrevocably submits to the non-exclusive jurisdiction of any
such court in any such suit, action or proceeding. The Borrower does hereby
designate and appoint Prentice-Hall Corporation System, Inc. as its authorized
agent to accept and acknowledge on its behalf service of any and all process
which may be served in any such suit, action or proceeding in any federal or
state court in New York, New York, and agrees that service of process upon said
agent with a copy to the Borrower at its principal executive offices, mailed or
delivered to the Borrower in the manner provided herein, shall be deemed in
every respect effective service of process upon the Borrower, in any such suit,
action or proceeding in the State of New York. The Borrower (i) shall give
prompt notice to the Administrative Agent of any changed address of its
authorized agent hereunder, (ii) may at any time and from time to time designate
a substitute authorized agent with an office in New York, New York (which office
shall be designated as the address for service of process), and (iii) shall
promptly designate such a substitute if its authorized agent ceases to have an
office in New York, New York or is dissolved without leaving a successor
Section 10.4. Modification, Waiver in Writing. Any provision
of this Agreement or the other Loan Documents may be modified, amended,
extended, discharged or terminated if, but only if, such modification,
amendment, extension, discharge or termination is in writing and is signed by
the Borrower and the Required Lenders (or signed by an Agent acting on their
behalf, and at their direction, pursuant hereto) and by any Agent whose rights,
responsibilities or obligations would be affected thereby; provided that no such
modification, amendment or extension shall, unless signed by all the Lenders,
(i) extend the scheduled maturity (including, without limitation, the final
maturity) of the Loan, reduce the rate or extend the time of payment of interest
or fees under this Agreement (other than as a result of waiving the
applicability of any post-default increase in interest rate) or reduce or
increase the principal amount of the Loan or the Lenders' respective Loan
Commitment Percentages, (ii) release the Principal of any of its obligations
under the Loan Documents to which it is a party, (iii) change any provision of
any Loan Document providing for pro rata payments to the Lenders, (iv) amend or
modify any provision of this Section 10.4 or Sections 2.8(a), 2.13, 2.14, 7.1,
10.9 or 10.26, (v) reduce any percentage specified in, or otherwise modify, the
definition of Required Lenders, (vi) consent to the assignment or transfer by
Borrower of any of its rights or obligations under (or in respect of) this
Agreement (provided that the foregoing shall not be construed to require any
Lender's consent to an Affiliate Transfer, merger or consolidation made in
accordance with the provisions of this Agreement), (vii) forgive the payment of
any principal or interest due in respect of the Loan, (viii) increase the
principal amount of the Loan or (ix) release any guaranties or other collateral
securing the Loan, except as otherwise required in any of the Loan Documents.
Furthermore, if all Lenders and the affected Agent shall so agree, all Lenders
and such Agent (without the consent or approval of, and without such
modification, amendment, termination or waiver being executed by, Borrower or
any other Agent) may (i) modify, amend, terminate or waive any provision of
Article IX hereof (to the extent such modification, amendment, termination or
waiver shall not materially adversely affect Borrower (including, without
limitation, any approval rights that the Borrower shall have with respect to
successor Agents) and/or (ii) modify or amend any term, condition or provision
of this Agreement (or of any other Loan Document) that grants to such Agent any
approval or consent right (unless such term, condition or provision expressly
requires such Agent not to unreasonably withhold or delay such consent or
approval), to require that such Agent obtain the approval or consent of the
Required Lenders or of all Lenders before giving or withholding such approval or
consent. Any modification, amendment, extension, discharge, termination or
waiver made pursuant to this subsection 10.4 shall be effective only in the
specific instance, and for the purpose, for which given. Except as otherwise
expressly provided herein, no notice to or demand on the Borrower shall entitle
the Borrower to any other or future notice or demand in the same, similar or
other circumstances. Notwithstanding the foregoing, the discharge of the Deed of
Trust and the Assignment of Leases in accordance with their respective terms
after the Obligations (as defined in the Deed of Trust) shall be paid and
performed in accordance with the terms, agreements, covenants, provisions and
conditions of the Loan Documents (other than any indemnification obligations
that shall not have theretofore arisen and that shall survive the payment of the
other Obligations) shall not require the consent of any Lenders.
Section 10.5. Delay Not a Waiver. Neither any failure nor any
delay on the part of any party hereto in insisting upon strict performance of
any term, condition, covenant or agreement, or exercising any right, power,
remedy or privilege hereunder, or under any Loan Document, or any other
instrument given as security therefor, shall operate as or constitute a waiver
thereof, nor shall a single or partial exercise thereof preclude any other
future exercise, or the exercise of any other right, power, remedy or privilege.
In particular, and not by way of limitation, by accepting payment after the due
date of any amount payable under this Agreement, any Note or any other Loan
Document, neither any Agent nor any Lender shall be deemed to have waived any
right either to require prompt payment when due of all other amounts due under
this Agreement, any Note or the other Loan Documents, or to declare a default
for failure to effect prompt payment of any such other amount.
Section 10.6. Notices. All notices, demands, consents,
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approvals, requests and other communications required or permitted hereunder
("Notices") shall be given in writing and shall be effective for all purposes if
(a) hand delivered or (b) sent by (i) certified or registered United States
prepaid, (ii) expedited prepaid delivery service, either commercial or United
States Postal Service, with proof of attempted delivery, or (iii) facsimile
(with answer back acknowledged), addressed if to the Syndication Agent at its
address set forth on the first page hereof, Attention: Mark J. Kogan (Facsimile
Number: (212)-902-1691; Telephone Number: (212) 902-2565); if to the Collateral
Agent or the Administrative Agent, at its address set forth on the first page
hereof, Attention: Alan Pendergast (Facsimile Number: (415) 397-0791; Telephone
Number: (415) 616-4155) with a copy to Loan Administration The Bank of Nova
Scotia, Suite 2700, 600 Peachtree Street N.E., Atlanta, Georgia 30308,
Attention: Craig Subryan (Facsimile Number: 404-888-8998; Telephone
Number:404-877-1547); if to GSMC, as Lender, c/o Goldman, Sachs & Co., 85 Broad
Street, 26th Floor, New York, New York 10004, Attention: Mark J. Kogan
(Facsimile Number: (212)-902-1691; Telephone Number: (212) 902-2565); if to any
other Lender at its Lending Office; if to the Borrower at its address set forth
on the first page hereof, Attention: David Friedman (Facsimile Number: (702)
733-5620; Telephone Number: (702) 733-5502); or at such other address and Person
(or facsimile and telephone number) as shall be designated from time to time by
any party hereto, as the case may be, in a written notice to the other parties
hereto in the manner provided for in this Section 10.6. Copies of all Notices
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directed to the Syndication Agent and/or GSMC, as Lender, shall be delivered to
Willkie Farr & Gallagher, 787 Seventh Avenue, New York, New York 10019,
Attention: Eugene A. Pinover, Esq. (Facsimile Number: 212-728-8111; Telephone
Number: 212-821-8254) and to Goldman, Sachs & Co., 85 Broad Street, 12th Floor,
New York, New York 10004, Attention: Legal Department (Facsimile Number: (212)
902-4140; Telephone Number: (212) 902-0900); a copy of all Notices directed to
the Borrower shall be delivered to Harris B. Freidus, Esq., Paul, Weiss,
Rifkind, Wharton & Garrison, 1285 Avenue of the Americas, New York, New York
10019, (Facsimile Number: (212) 757-3990; Telephone Number:(212) 373-3064). A
Notice shall be deemed to have been given: in the case of hand delivery, at the
time of delivery (if delivered on a Business Day during business hours, and
otherwise, on the next Business Day); in the case of registered or certified
mail, two Business Days after mailing; in the case of expedited prepaid delivery
on the Business Day after the same was sent and in the case of facsimile, when
sent and answerback acknowledged (if sent on a Business Day during business
hours, and, otherwise, on the next Business Day); provided that Notices to the
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Administrative Agent under Sections 2.1, 2.6, and 2.8 shall not be effective
------------------
until received. A party receiving a Notice which does not comply with the
technical requirements for Notice under this Section 10.6 may elect to waive any
------------
deficiencies and treat the Notice as having been properly given.
SECTION 10.7. TRIAL BY JURY. EACH OF THE BORROWER, EACH LENDER
AND EACH AGENT, TO THE FULLEST EXTENT THAT IT MAY LAWFULLY DO SO, WAIVES TRIAL
BY JURY IN ANY ACTION OR PROCEEDING, INCLUDING, WITHOUT LIMITATION, ANY TORT
ACTION, BROUGHT BY ANY PARTY HERETO WITH RESPECT TO THIS AGREEMENT, ANY NOTE OR
ANY OTHER LOAN DOCUMENT.
Section 10.8. Headings. The Article and Section headings
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in this Agreement are included herein for convenience of reference only and
shall not constitute a part of this Agreement for any other purpose.
Section 10.9. Assignments and Participations . (a) The Lenders
(if all of the Lenders shall so agree) shall have the right, without the consent
of the Borrower (so long as Borrower's rights and obligations under the Loan
Documents are not adversely affected to any material extent), to consummate a
Securitization. Furthermore, each Lender shall have the right, without the
consent of the Borrower (but subject to the other provisions of this Section
10.9), to, sell, assign, otherwise transfer and/or participate its rights,
interest and obligations under this Agreement and the other Loan Documents, in
whole or in part, to any Person or Persons. The Borrower shall keep confidential
all information relating to such proposed Securitization, assignment or
participation and the identity of each potential holder of Securities, assignee
or participant (except to the extent that if such information were Confidential
Information and Borrower were a Lender that such Lender, pursuant to the
provisions of Section 10.28, would be permitted to disclose the same).
(a)(b) Each assignee with respect to any Assignment (an
"Assignee"), and the assigning Lender, shall execute and deliver an Assignment
and Assumption Agreement substantially in the form of Exhibit A to that certain
Co-Lender and Retained Interest Agreement among the Lenders and Agents, with
(and subject to) the subscribed consent of the Administrative Agent and, to the
extent expressly required hereby, the Borrower (an "Assignment and Assumption
Agreement"); provided that if an Assignee is an Affiliate of such transferor
Lender or was a Lender immediately prior to such assignment, no consent of the
Administrative Agent or the Borrower shall be required; provided further that no
Agent shall have any obligations to an Assignee until such Agent shall have
received written notice of the name, address, telephone and facsimile numbers
and Loan Commitment Percentage of such Assignee. Each Assignment shall be of a
constant, and not a varying, percentage of all of the transferring Lender's
rights and obligations under the Loan Documents. Upon execution and delivery of
such instrument and payment by such Assignee to such transferor Lender of an
amount equal to the purchase price agreed between such transferor Lender and
such Assignee, such Assignee shall be a Lender party to this Agreement and shall
have all the rights and obligations of a Lender, and the transferor Lender shall
be released from its obligations hereunder to a corresponding extent, and no
further consent or action by any party shall be required. Upon the consummation
of any Assignment pursuant to this subsection (b), the transferor Lender, the
Agents and the Borrower shall make appropriate arrangements so that, if
required, a new Note(s) is issued to the Assignee and the prior Note(s) held by
the transferor Lender is canceled. Notwithstanding anything in this Agreement to
the contrary, after an Assignment by a Lender, (x) the "Lender" (prior to the
Assignment) shall (1) continue to have the benefits of all indemnifications and
(2) shall continue to have all other rights and obligations under the Loan
Documents that such Lender had during the period such party was "Lender"
hereunder to the extent such rights and obligations relate to such period and
(y) the transferring Lender shall not be released from any liability of such
Lender under the Loan Documents that arose prior to such Assignment.
(c) On or prior to the effective date of any Assignment
contemplated hereby, if the Administrative Agent shall so require, the
transferor Lender shall deliver to the Administrative Agent, at such Lender's
own expense, (i) an endorsement to the Title Insurance Policy stating that the
Assignment in question will not impair in any way the Lien of the Deed of Trust
and (ii) such other documents, instruments and other materials, including,
without limitation, legal opinions, as the Administrative Agent shall reasonably
deem necessary.
(d) Unless an Event of Default shall then exist, no Lender
shall consummate an Assignment or a Participation to any Competitor; provided
that each such Lender shall be entitled to rely on a written statement from the
proposed assignee or participant that it is not a Competitor (without making any
further inquiry or investigation) and no such Lender shall be liable to the
Borrower or to any other Person if such Lender shall consummate an Assignment or
Participation with a Person that shall in fact be a Competitor notwithstanding
the fact that such Person delivered such a written statement.
(e) Notwithstanding any other provision contained in this
Agreement or any other Loan Document to the contrary, any Lender may assign all
or any portion of the Loan or the Notes held by it to any Federal Reserve Bank
or the United States Treasury as collateral security pursuant to Regulation A of
the Board of Governors of the Federal Reserve System and any Operating Circular
issued by such Federal Reserve Bank. No such assignment shall release the
transferor Lender from its obligations hereunder.
(f) Without the prior written consent of the Administrative
Agent, no Lender shall consummate a Participation to a Foreign Lender unless
such Foreign Lender shall submit to the Administrative Agent the applicable
Exemption/Reduction Forms in accordance with the provisions of subsection
2.10(b). Each holder of a participation interest in the Loan Documents (a
"Participant") shall be entitled to receive all information received directly by
the Lenders from the Borrower under this Agreement. After the effectiveness of
any Participation, the applicable Lender shall provide notice to the Borrower
and the Agents of the identity, address and other pertinent information
pertaining to the Participant. The Borrower agrees that if an Event of Default
shall exist, then each Participant shall be deemed to have the right of setoff
in respect of its participating interest in amounts owing under this Agreement
and the other Loan Documents to the same extent as if the amount of its
participating interest were owing directly to it as the Lender under this
Agreement. The Borrower also agrees that each Participant shall be entitled to
the benefits of subsections 2.10, 5.1(I) and 5.1(J) (subject to the limitations
set forth in such subsections) with respect to its participation in the Loan
outstanding from time to time. Notwithstanding any sale of a participation
interest by a Lender, such Lender shall remain fully responsible for the
performance of all of its obligations under the Loan Documents and, except as
otherwise expressly provided herein, no such Participant shall acquire any
rights under this Agreement except by and through the party from which it
acquired its participation interest.
(g) Nothing contained in this Agreement shall prohibit, or
shall be deemed to prohibit, the Person that is any Agent from serving as Agent
and concurrently being or becoming a Participant and/or Lender.
(h) The Administrative Agent shall maintain records of all
Assignments and Participations and, upon request therefor by any Agent or Lender
or Borrower, shall permit such Agent or Lender or Borrower, as applicable, to
review such records.
Section 10.10. Collateral. Each of the Lenders represents to
the Agents and each of the other Lenders that it in good faith is not relying
upon any "margin stock" (as defined in Regulation U) as collateral in the
extension or maintenance of the credit provided for in this Agreement.
Section 10.11. Severability. Wherever possible, each provision
of this Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement.
Section 10.12. Preferences. No Agent shall have any obligation
to marshal any assets in favor of the Borrower or any other party or against or
in payment of any or all of the obligations of Borrower or any other Person
pursuant to this Agreement, the Notes or any other Loan Document. Subject to the
provisions of the last sentence of Section 2.8(a), the Administrative Agent (at
the written direction of the Required Lenders) shall have the continuing and
exclusive right to apply or reverse and reapply any and all payments by the
Borrower to any portion of the obligations of the Borrower hereunder. To the
extent the Borrower makes a payment or payments to any Agent or any Lender,
which payment or proceeds or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside or required to be repaid to
a trustee, receiver or any other party under any bankruptcy law, state or
federal law, common law or equitable cause, then, to the extent of such payment
or proceeds received, the obligations hereunder or part thereof intended to be
satisfied shall be revived and continue in full force and effect, as if such
payment or proceeds had not been received by such Agent or such Lender, as
applicable.
Section 10.13. Waiver of Notice. The Borrower shall not be
entitled to any notices of any nature whatsoever from any Agent or any Lender
except with respect to matters for which this Agreement or the other Loan
Documents specifically and expressly provide for the giving of notice by such
Agent or Lender to the Borrower and except with respect to matters for which the
Borrower is not, pursuant to applicable Legal Requirements, permitted to waive
the giving of notice. The Borrower hereby expressly waives the right to receive
any notice from any Agent or any Lender with respect to any matter for which
this Agreement or the other Loan Documents does not specifically and expressly
provide for the giving of notice by such Agent to the Borrower.
Section 10.14. Borrower's Remedies(a) If the Borrower shall
seek the approval by or the consent of any Agent or Lender under this Agreement
or under any other Loan Documents and such Agent or Lender shall fail or refuse
to give such consent or approval then Borrower shall not be entitled to any
damages for any withholding or delay of such approval or consent by such Agent
or Lender, it being intended that Borrower's sole remedy shall be to bring an
action for an injunction or specific performance, which remedy or injunction or
specific performance shall be available only in those cases where the Agent or
Lender in question has expressly agreed under the Loan Document in question not
to unreasonably withhold or delay its consent or approval.
(b) In no event shall Borrower seek, receive or recover
punitive damages against any Lender or Agent in connection with any suit,
action, claim or proceeding against any Lender or Agent.
Section 10.15. Exhibits Incorporated. The information set
forth on the cover, heading and recitals hereof, and the Exhibits attached
hereto, are hereby incorporated herein as a part of this Agreement with the same
effect as if set forth in the body hereof.
Section 10.16. Offsets, Counterclaims and Defenses. Any
assignee of any Agent's or any Lender's interest in and to this Agreement and
the other Loan Documents shall take the same free and clear of all offsets,
counterclaims or defenses which are unrelated to this Agreement and the other
Loan Documents which the Borrower may otherwise have against any assignor of
this Agreement and the other Loan Documents, and no such unrelated counterclaim
or defense shall be interposed or asserted by the Borrower in any action or
proceeding brought by any such assignee upon this Agreement and other Loan
Documents and any such right to interpose or assert any such unrelated offset,
counterclaim (other than compulsory counterclaims) or defense in any such action
or proceeding is hereby expressly waived by the Borrower.
Section 10.17. No Joint Venture or Partnership. The Borrower,
on the one hand, and the Agents and the Lenders, on the other hand, intend that
the relationship created hereunder be solely that of borrower, on the one hand,
and Agents and lenders, respectively, on the other hand. Nothing herein is
intended to create a joint venture, partnership, tenancy-in-common, or joint
tenancy relationship between or among the Borrower, the Agents and the Lenders.
Section 10.18. Waiver of Marshaling of Assets Defense. To the
fullest extent the Borrower may legally do so, the Borrower waives all rights to
a marshaling of its assets, the assets of others with interests in the Borrower,
and of the Trust Property, or to a sale in inverse order of alienation in the
event of foreclosure of the interests hereby created, and agrees not to assert
any right under any laws pertaining to the marshaling of assets, the sale in
inverse order of alienation, homestead exemption, the administration of estates
of decedents to defeat, reduce or affect the right of any Agent or any Lender
under the Loan Documents to a sale of the Trust Property for the collection of
the Indebtedness without any prior or different resort for collection, or the
right of any Agent or any Lender to the payment of the Indebtedness out of the
sales proceeds of the Trust Property in preference to every other claimant
whatsoever.
Section 10.19. Waiver of Counterclaim. The Borrower hereby
waives the right to assert a counterclaim, other than a compulsory counterclaim,
in any action or proceeding brought against it by any Agent, any Lender or any
of their respective agents.
Section 10.20. Conflict; Construction of Documents. In the
event of any conflict between the provisions of this Agreement and the
provisions of any of the other Loan Documents, the provisions of this Agreement
shall prevail. The parties hereto acknowledge that they were represented by
counsel in connection with the negotiation and drafting of the Loan Documents
and that the Loan Documents shall not be subject to the principle of construing
their meaning against the party which drafted same.
Section 10.21. Brokers and Financial Advisors. Each of the
Borrower, each Agent and each Lender hereby severally represents that it has
dealt with no financial advisors (other than, in the case of the Borrower and
GSMC, Affiliates of GSMC, with respect to whom no brokerage, finder's or similar
fee is payable by Borrower), brokers, underwriters, placement agents, or finders
in connection with the transactions contemplated by this Agreement. Each of the
Borrower, each Agent and each Lender severally hereby agrees to indemnify and
hold the other parties hereto harmless from and against any and all claims,
liabilities, costs and expenses of any kind in any way relating to or arising
from a claim by any Person that such Person acted on behalf of the indemnifying
party in connection with the transactions contemplated herein. The provisions of
this Section 10.21 shall survive the expiration and termination of this
Agreement and the repayment of the Indebtedness.
Section 10.22. Counterparts. This Agreement may be executed
------------
in any number of counterparts, each of which when so executed and delivered
shall be an original, but all of which shall together constitute one and the
same instrument.
Section 10.23. Payment of Expenses. The Borrower shall pay all
Transaction Costs, which shall include, without limitation, (a) reasonable
out-of-pocket fees, costs and expenses of (i) the Syndication Agent and GSMC in
connection with the negotiation, preparation, execution and delivery of the Loan
Documents and the documents and instruments referred to therein, (ii) the Agents
and the Lenders in connection with the creation, perfection or protection of the
Collateral Agent's Liens in the Collateral (including, without limitation, fees
and expenses for title and lien searches or amended or replacement deeds of
trust, UCC Financing Statements or other Collateral Security Instruments, title
insurance premiums, survey charges and filing and recording fees and taxes,
third party due diligence expenses for the Collateral plus travel expenses,
accounting firm fees, costs of the appraisals, environmental reports (and an
environmental consultant), and engineering reports), (iii) the Agents in
connection with the administration of the Loan, (iv) the Agents and the Lenders
in connection with (A) the negotiation, preparation, execution and delivery of
any amendment, waiver or consent relating to any of the Loan Documents requested
by the Borrower and (B) the preservation of rights under and enforcement of the
Loan Documents and the documents and instruments referred to therein, including
any restructuring or rescheduling of the Indebtedness, (v) the Agents and the
Lenders as otherwise required pursuant to the express provisions of the Loan
Documents and (b) the reasonable fees, expenses and disbursements of counsel to
the applicable Agents and/or the Lenders, as applicable, in connection with all
of the foregoing.
Section 10.24. Non-Recourse. Anything contained herein, in any
Note or in any other Loan Document to the contrary notwithstanding, no recourse
shall be had for the payment of the principal or interest on any Note or for any
other Indebtedness hereunder or under any other Loan Document against any direct
or indirect shareholder, director, officer, member, partner or incorporator of
the Borrower for any deficiency or other sum owing with respect to any Note or
any other Indebtedness arising under this Agreement or any Loan Document;
provided, however, that the foregoing provisions of this paragraph shall not (x)
affect or prejudice, or be deemed to affect or prejudice, the rights of any
Agent or any Lender to (1) (A) proceed against Borrower or against the
Borrower's assets (including, without limitation, the Collateral) or (B) proceed
against the Principal under the Limited Payment Guaranty, the Scope Change
Guaranty and under the Principal Non-Recourse Carve-Out and Limited
Environmental Matters Guaranty and against any other Person that may be a party
to a Loan Document (to the extent provided therein) or against the Principal's
or any such other Person's assets (to the extent of its liability under the
applicable Loan Document(s) to which it is a party) and/or (2) recover damages
against any individual for his or her own fraud or intentional
misrepresentation; and/or (y) constitute a waiver, release or discharge of any
indebtedness or obligation evidenced by any Note or secured by, or otherwise
relating to, the Loan Documents, and the same shall continue until paid or
discharged in full.
Section 10.25. Servicer. The Administrative Agent, at the sole
cost and expense of the Lenders, may elect to enter into a servicing agreement
with a servicer, pursuant to which the servicer shall be appointed to service
and administer the Loan and the Bank Accounts in accordance with the terms
hereof. The Administrative Agent shall promptly notify the Borrower if the
Administrative Agent shall elect to appoint a servicer pursuant to this Section
10.25, and thereafter all Notices from the Borrower to the Administrative Agent
shall be delivered to such servicer with a copy concurrently delivered to the
Administrative Agent, and any Notice from such servicer to the Borrower shall
have the same force and effect as a Notice from the Administrative Agent;
provided that if the Borrower shall receive conflicting Notices from the
Administrative Agent and the servicer, the Notice from the Administrative Agent
shall control. Notwithstanding the foregoing, if no Event of Default shall then
exist, (i) unless a proposed servicer under this Section 10.25 shall be a
Lender, an Agent, an affiliate of GS&Co. or a Qualified Bank, such proposed
servicer shall be subject to the Borrower's consent (not to be unreasonably
withheld or delayed) and (ii) if, at the time of the appointment of any proposed
servicer, such proposed servicer shall be a Competitor, then, without the
Borrower's consent, such Competitor shall not be permitted to serve as a
servicer under this Section 10.25; provided that the Lenders and the Agents
shall be entitled to rely on a written statement from a proposed servicer that
it is not a Competitor (without making any further inquiry or investigation) and
no Lender and no Agent shall be liable to the Borrower or to any other Person if
a servicer shall in fact be a Competitor notwithstanding the fact that such
servicer delivered such a written statement.
Section 10.26. Set-Offs; Sharing of Set-Offs. (a) In addition
to any other rights and remedies of the Agents and the Lenders provided in any
Loan Document, at law or in equity, the Agents and each Lender shall have the
right, without prior notice to Borrower, any such notice being expressly waived
by Borrower to the extent permitted by applicable law, at any time that an Event
of Default shall exist, with respect to any amount payable to such Agent or such
Lender, as applicable, under any Loan Document (whether at the stated maturity,
by acceleration or otherwise) to set-off and appropriate and apply against such
amount any and all deposits (general or special, time or demand, provisional or
final), in any currency, in each case whether direct or indirect, absolute or
contingent, matured or unmatured, at any time held or owing by such Agent or
such Lender, as applicable, or any branch or agency thereof to or for the credit
or the account of Borrower. Each Agent and each Lender agrees promptly to notify
Borrower and the Administrative Agent after any such set-off and application
made by such Agent or such Lender, as applicable, provided that the failure to
give such notice shall not affect the validity of such set-off and application.
(a)(b) Each Lender agrees that if it shall, by exercising any
right of set-off or counterclaim or otherwise, receive payment of a proportion
of the aggregate amount of principal and interest due with respect to any Note
held by it which is greater than the proportion received by any other Lender in
respect of the aggregate amount of principal and interest due with respect to
any Note held by such other Lender, then the Lender receiving such
proportionately greater payment shall promptly notify the Administrative Agent
in writing of such fact and purchase such participations in the Notes held by
the other Lenders, and such other adjustments shall be made, as may be required
so that all such payments of principal and interest with respect to the Notes
held by the Lenders shall be shared by the Lenders pro rata (and such Lender
shall inform the Administrative Agent in writing of such participation and such
other adjustments); provided that nothing in this Section shall impair the right
of any Lender to exercise any right of set-off or counterclaim it may have and
to apply the amount subject to such exercise to the payment of indebtedness of
the Borrower to such Lender other than its indebtedness hereunder. Each Lender
further agrees that if a payment to a Lender shall be rescinded or must
otherwise be restored, each Lender which shall have shared the benefit of such
payment shall, by repurchase of a participation theretofore sold, return its
share of that benefit to each Lender whose payment shall have been rescinded or
otherwise restored. Borrower agrees that any Lender so purchasing such a
participation may, to the fullest extent permitted by law, exercise all rights
of payment, including, without limitation, set-off, banker's lien or
counterclaim, with respect to such participation as fully as if such Lender were
a holder of the Loan or other obligation in the amount of such participation.
The Administrative Agent shall keep records (that shall be conclusive and
binding in the absence of manifest error) of participations purchased pursuant
to this Section 10.26 of which it received notice and shall in each case notify
the Lenders and Borrower following any such purchase. Except as otherwise
expressly provided in this Agreement, if any Lender shall fail to remit to the
Administrative Agent or any other Lender any amount payable to the
Administrative Agent or such Lender, as applicable, pursuant to this Agreement
by 11:00 a.m., New York City time on the date on which such amount is due, such
amount shall accrue interest thereon, for each day from the date such amount is
due until the day such amount is paid to the Administrative Agent or such other
Lender, as applicable, at a rate per annum equal to the Federal Funds Rate.
Section 10.27. Provisions Not for Benefit of Borrower. Nothing
contained in this Agreement or any other Loan Document, including, without
limitation, this Article X, shall grant, or be construed to grant, any cure
rights or grace period to Borrower or to any other Person under any Loan
Document not specifically set forth in the applicable Loan Document and the
Lenders specifically reserve their rights to take any action permitted under the
Loan Documents, at law or in equity at any time that an Event of Default shall
exist. Furthermore, notwithstanding anything to the contrary contained in this
Agreement or any other Loan Document, each term, provision and condition
contained in this Agreement or any other Loan Document to the effect that any
Agent shall be entitled or required to take certain action (or to refrain from
taking certain action) only if a given Lender, the Required Lenders, some other
group of Lenders or another Agent so directs such Agent shall be solely for the
benefit of the Lenders and the Agents, and not Borrower, the Principal, any
Affiliate of either or any other Person, and neither Borrower, the Principal,
any Affiliate of either nor any other Person (other than a Lender or Agent)
shall, or shall be entitled to, enforce any such term, provision or condition or
claim or assert (in a court of law or otherwise) that the taking of any such
action (or the refraining from taking of any such action) was invalid or
unlawful or constituted a breach or default under this Agreement or any other
Loan Document or relieves or releases Borrower, the Principal, any Affiliate of
either or any other Person from any obligation or liability under this
Agreement, any other Loan Document or at law or in equity.
Section 10.28. Confidentiality. Each of the Lenders and the
Agents agrees not to disclose to any third party any Confidential Information
(as defined below), except that any of the Lenders or the Agents may disclose
such information (a) in connection with any litigation between such Lender or
such Agent and Borrower, Principal or any other Affiliate, (b) upon the order,
request or demand of any Governmental Authority or if otherwise required by
applicable law or in the case of a Lender that is an insurance company or an
Affiliate thereof, upon the order, request or demand of National Association of
Insurance Commissioners or the Securities Valuation Office thereof, (c) in
connection with the exercise of any right or remedy hereunder or under any Loan
Document after the occurrence of an Event of Default or Default, (d) to those of
its employees, accountants, attorneys, agents and other advisors, directors,
officers, shareholders, partners, members and other principals who are working
on, or are consulted in connection with, the transactions contemplated by the
Loan Documents, (e) any rating agency that may or will rate any class of
securities in connection with a Securitization or (f) to any actual or potential
Participant, Assignee, Lender, Agent, investor, agent, or servicer that agrees
to be bound by the provisions of this Section 10.28. "Confidential Information"
shall mean any information relating to the business of Borrower, Principal or
any Affiliate of Borrower which is delivered by Borrower, Principal or such
Affiliate of Borrower to any Lender or Agent or relating to the Loan or the Loan
Documents; provided that "Confidential Information" shall not include
information (i) that is or becomes generally available to the public, other than
as a result of the disclosure by any Lender or Agent in breach of this
provision, (ii) that is or becomes available to any Lender or Agent from any
source other than Borrower, Principal or such Affiliate unless the party
supplying such information shall have advised the Lender or Agent that such
source is subject to a confidentiality agreement that covers the information in
question or (iii) that is already in the possession of any Lender or Agent on
the date hereof and that is not otherwise "Confidential Information" as defined
herein. In the event that any Lender or Agent is required or demanded by legal
process (e.g., depositions, interrogatories, requests for information or
documents, subpoena, civil investigation demand or similar process) to disclose
any of the Confidential Information, such Lender or Agent shall give prompt
written notice to Borrower of such request or demand so that Borrower may,
should it elect to do so, within five (5) Business Days of receipt of such
notice, seek a protective order or other appropriate remedy to challenge or
contest such request (and give such Lender or Agent notice thereof), and during
the pendency of any such action by Borrower, such Lender or Agent shall not, to
the extent permitted by applicable law, disclose such Confidential Information.
ARTICLE XI.
SECURITIZATION
Section 11.1. Cooperation. The Borrower hereby acknowledges
that the Lenders or any of their Affiliates (in the Lenders' sole and absolute
discretion) may negotiate and consummate an offering of certificates or other
securities representing direct or indirect interests in the Loan, the Loan
Documents or any portion thereof (a "Securitization"). In connection with any
Securitization or proposed Securitization, Borrower shall pay all costs that
Borrower incurs in connection therewith, including, without limitation, the
costs of its own counsel and of preparing information and materials required to
be furnished by Borrower but not any other costs including, without limitation,
the costs of Lenders' or any Agents' counsel or the out-of-pocket costs incurred
by any Lender or Agent in connection with a Securitization. The Borrower agrees
that, promptly upon the request therefor by the Administrative Agent, the
Borrower will diligently cooperate with the Lenders and the Agents in connection
with a Securitization, including:
(a) amending this Agreement and the other Loan Documents, and
executing such additional documents, as may be required by the rating
agency(ies) selected by the Required Lenders (collectively, the "Rating
Agencies"), provided, no such amendment will (x) change the term, principal
amount or interest rate of the Loan (other than to effect a hyperamortization
structure for the Loan) or require amortization of the principal amount of the
Loan prior to the maturity thereof not otherwise expressly contemplated by this
Agreement or (y) otherwise (except to a de minimis extent) increase Borrower's
or Principal's costs (except as otherwise specified herein), liabilities or
obligations, or decrease Borrower's, or increase Lender's, rights, under the
Loan Documents;
(b) modifying the Notes to create multiple pari passu notes;
---- -----
(c) providing such information as may be reasonably requested
in connection with the preparation of a private placement memorandum,
registration statement or other offering document required to privately place or
publicly distribute the securities being issued in connection with the
Securitization (the "Securities") in a manner which does not conflict with
federal or state securities laws;
(d) causing to be rendered such customary opinion letters as
may be reasonably requested by the Rating Agency(ies) (including, but not
limited to, a substantive nonconsolidation opinion that is substantively
equivalent to the substantive nonconsolidation opinion accepted by the
Administrative Agent in connection with the funding of the Loan);
(e) updating the representations, warranties and covenants
with respect to the Borrower, the Principal and the Real Property that are
contained in the Loan Documents if the same is reasonably requested by the
Rating Agencies (which representations, warranties and covenants will survive
the closing of the Securitization);
(f) amending the Borrower's and/or the Managing Member's
organizational documents and/or making such other changes to the Borrower's
and/or the Managing Member's structure as required by the Rating Agency(ies) to
conform to customary requirements for single purpose bankruptcy remote entities
in similar transactions;
(g) obtaining a comfort letter (in customary form and
containing customary exceptions) from a nationally recognized accounting firm in
connection with financial information relating to the Borrower, the Principal
and/or the Real Property and which, in connection with the Securitization, shall
be presented in the private placement memorandum, prospectus or other offering
document used in the Securitization; provided that, notwithstanding any of the
foregoing, in no event shall the foregoing be deemed to obligate the Principal
to deliver, or to cause to be delivered, any financial statements (audited or
otherwise), certificates or documents relating to the personal net worth or
financial condition of the Principal;
(h) providing such updated third party reports and financial
information regarding the Real Property and the Borrower (but not the Principal)
and expanded ongoing administration and reporting by any real estate mortgage
investment conduit ("REMIC") formed in connection with the Securitization as may
be requested by the Rating Agencies or potential investors in the Securities or
otherwise in connection with an election of REMIC status;
(i) obtaining any insurance policies reasonably requested by
the Rating Agencies in connection with the Securitization; and
(j) providing an indemnification agreement, in form and
substance reasonably satisfactory to the Administrative Agent, pursuant to which
the Borrower will:
(i) certify that it has carefully examined the
Securitization offering document and that such document insofar as it
relates to the Borrower, the Principal, any affiliates thereof and the
Real Property, does not (subject to the last sentence of clause (ii)
below) contain any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements made, in
light of the circumstances under which they were made, not misleading;
(ii) indemnify the Lenders and the Agents and their respective
affiliates for any losses, claims, damages and liabilities (including,
without limitation, reasonable attorneys' fees and expenses) (the
"Liabilities") to which such parties may become subject or which they
may incur to the extent that the Liabilities arise out of or are based
upon any untrue statement or alleged untrue statement of any material
fact relating to the Borrower, the Principal, any affiliate thereof, or
the Real Property contained in such sections or arise out of or are
based upon the omission or alleged omission to state therein a material
fact relating to Borrower, the Principal, any affiliate thereof, or the
Real Property necessary in order to make the statements therein in
light of the circumstances under which they were made, not misleading.
Notwithstanding the foregoing, the Borrower shall not have liability
under such indemnity to the extent the Liabilities arise out of a
statement that (i) was contained in a document not furnished to
Borrower prior to its release to the investor in question or (ii) no
Lender or Agent corrected notwithstanding the fact that the Borrower
notified the Administrative Agent that such statement was untrue or
misleading; provided that such notification from Borrower to the
Administrative Agent (x) was in writing, (y) instructed the
Administrative Agent how to correct the statement in question and (z)
was received by the Administrative Agent sufficiently prior to the date
upon which the Securitization offering document was first distributed
so that the Administrative Agent had sufficient time to correct such
statement; and
(iii) agreeing to reimburse the Lenders, the Agents and their
respective Affiliates for any attorneys' fees and expenses and other
expenses reasonably incurred by such parties in connection with
investigation or defending the Liabilities.
ARTICLE XII.
SUBORDINATION OF DEED OF TRUST TO CERTAIN EASEMENTS
Section 12.1. Subordination . Provided that no Default or
Event of Default shall then exist, the Collateral Agent, upon request
therefor of the Borrower, shall subordinate the Lien of the Deed of
Trust to easements created under and in accordance with the terms of
the REA and to Permitted Easements.
Section 12.2. Costs and Expenses . Borrower shall, within ten
(10) Business Days of demand therefor by the Collateral Agent,
reimburse the Collateral Agent for all of the Collateral Agent's
reasonable out-of-pocket costs and expenses (including, without
limitation, reasonable attorney's fees, disbursements and expenses)
incurred in connection with its review of such easement and of its
review, negotiation and, to the extent applicable, execution and
delivery, of any documentation pertaining thereto.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their duly authorized representatives, all as
of the day and year first above written.
LENDER:
GOLDMAN SACHS MORTGAGE COMPANY, a New York
limited partnership, in its capacity as a
Lender
By: Goldman Sachs Real Estate Funding Corp.,
its general partner
By: /s/ Richard Weiss
-----------------------------
Name: Richard Weiss
Title: Authorized Signatory
SYNDICATION AGENT:
GOLDMAN SACHS MORTGAGE COMPANY, a New York
limited partnership, in its capacity as
Syndication Agent
By: Goldman Sachs Real Estate Funding Corp.,
its general partner
By: /s/ Richard Weiss
-----------------------------
Name: Richard Weiss
Title: Authorized Signatory
[Signatures continued on next page]
[Signatures continued from preceding page]
COLLATERAL AGENT:
THE BANK OF NOVA SCOTIA
By: /s/ Van Otterloo
-----------------------------
Name: Van Otterloo
Title: Managing Director Corporate
ADMINISTRATIVE AGENT:
THE BANK OF NOVA SCOTIA
By: /s/ Van Otterloo
-----------------------------
Name: Van Otterloo
Title: Managing Director Corporate
BORROWER:
GRAND CANAL SHOPS MALL SUBSIDIARY, LLC,
a Delaware limited liability company
By: Grand Canal Shops Mall, LLC,
a Delaware limited liability company
and its sole member
By: Grand Canal Shops Mall Holding Company,
LLC, a Delaware limited liability
company and its sole member
By: Mall Intermediate Holding Company, LLC,
a Delaware limited liability company
and its sole member
By: Venetian Casino Resort, LLC,
its Sole Member
By: Las Vegas Sands, Inc.,
its sole member
By: /s/ David Friedman
------------------------
Name: David Friedman
Title: Secretary
[Signatures continued from preceding page]
[Signatures continued from preceding page]
The undersigned executes this Loan Agreement to acknowledge
its agreement to the terms and provisions of Section 2.9 of this Loan Agreement
SGA DEVELOPMENT, INC., a Nevada corporation.
By:/s/ Sheldon G. Adelson
--------------------------
Sheldon G. Adelson
President
Schedule G-1
COREA Qualified Leases Leasing Guidelines
(a) the creditworthiness of the tenant, and of the guarantor, if any,
of the tenant's Lease obligations shall be subject to the Administrative Agent's
approval (which approval the Administrative Agent shall not unreasonably
withhold provided that at the time such approval is sought, such tenant (or
guarantor) shall not have made a general assignment for the benefit of
creditors, and there shall not have been filed by or against such tenant (or
guarantor) a petition which has not been dismissed under any Legal Requirement
pertaining to bankruptcy, arrangement, insolvency or reorganization or under any
similar Legal Requirement or for the appointment of a receiver, liquidator, or
trustee, and no action, case or proceeding which has not been dismissed shall
have been commenced under any such Legal Requirement with respect to such tenant
(or guarantor) or for the composition, extension, arrangement or adjustment of
such tenant's (or such guarantor's) obligations);
(b) the minimum term of such Lease must be such so that, when all
Leases that are relevant to the calculation of COREA Rent are taken together
(collectively, "COREA Leases"), COREA Leases under which, collectively, at least
60% of such COREA Rent has been paid (in the case of Actual Rent) or is payable
or, for percentage rent, projected to be payable (in the case of Projected
Rent), as applicable, shall provide for a minimum term of ten years or more,
COREA Leases under which, collectively, no more than 30% of such COREA Rent has
been paid (in the case of Actual Rent) or is payable (in the case of Projected
Rent), as applicable, shall provide for a minimum term of between five years and
ten years and COREA Leases under which, collectively, no more than 10% of such
COREA Rent has been paid (in the case of Actual Rent) or is payable or, for
percentage rent, projected to be payable (in the case of Projected Rent), as
applicable, shall provide for a minimum term of between one year and five years;
(c) with respect to the portion of the leased premises, if any, that is
located on the first level of the Mall, such tenant shall be obligated to pay an
average annual fixed rent per net rentable square foot, over the term of the
applicable Lease, that is at least equal to the annual fixed rental rate per net
rentable square foot set forth on Exhibit 1 with respect to the first floor of
the Mall;
(d) with respect to the portion of the leased premises, if any, that is
located on the second level of the Mall, such tenant shall be obligated to pay
an average annual fixed rent per net rentable square foot over the term of the
applicable Lease that is at least equal to the annual fixed rental rate per net
rentable square foot set forth on Exhibit 1 with respect to the second level of
the Mall;
(e) with respect to the portion of the leased premises, if any, that is
located in the Retail Annex, such tenant shall be obligated to pay an average
annual fixed rent per net rentable square foot over the term of the applicable
Lease that is at least equal to the annual fixed rental rate per net rentable
square foot set forth on Exhibit 1 with respect to the Retail Annex;
(f) for each lease year, for each level of gross revenue of the tenant
set forth on Exhibit 1, such tenant shall be obligated to pay, as percentage
rent, the relevant percentage (as set forth on Exhibit 1) of such tenant's gross
revenues for each lease year minus the minimum rent paid by the tenant for such
lease year;
(g) in no event shall the annual fixed rent that is payable with
respect to any lease year be less than 100% of the annual fixed rent that was
payable with respect to the immediately preceding lease year.
Schedule H-1
SNDA Qualified Leases Leasing Guidelines
(a) the creditworthiness of the tenant, and of the guarantor, if any,
of the tenant's Lease obligations, shall be subject to the Administrative
Agent's approval (which approval the Administrative Agent shall not unreasonably
withhold provided that, at the time such approval is sought, such tenant (or
guarantor) shall not have made a general assignment for the benefit of
creditors, and there shall not have been filed by or against such tenant (or
guarantor) a petition which has not been dismissed under any Legal Requirement
pertaining to bankruptcy, arrangement, insolvency or reorganization or under any
similar Legal Requirement or for the appointment of a receiver, liquidator, or
trustee, and no action, case or proceeding which has not been dismissed shall
have been commenced under any such Legal Requirement with respect to such tenant
(or guarantor) or for the composition, extension, arrangement or adjustment of
such tenant's (or such guarantor's) obligations);
(b) the minimum term of such Lease must be such so that, when all
Leases (other than Subordinate Leases (as defined in the Form Loan Agreement))
(including the Lease in question)(collectively, the "Approval Required Leases")
are taken together, Approval Required Leases that collectively demise at least
60% of the net rentable square footage of the first level of the Mall
Improvements demised by all Approval Required Leases shall provide for a minimum
term of ten years or more, Approval Required Leases that collectively demise no
more than 30% of the net rentable square footage of the first level of the Mall
Improvements demised by all Approval Required Leases shall provide for a minimum
term of between five years and ten years and Approval Required Leases that
collectively demise no more than 10% of the net rentable square footage of the
of the first level of the Mall Improvements demised by all Approval Required
Leases shall provide for a minimum term of between one year and five years;
(c) with respect to the portion of the leased premises, if any, that is
located on the first level of the Mall, such tenant shall be obligated to pay an
average annual fixed rent per net rentable square foot, over the term of the
applicable Lease, that is at least equal to the annual fixed rental rate per net
rentable square foot set forth on Exhibit 1 with respect to the first floor of
the Mall;
(d) with respect to the portion of the leased premises, if any, that is
located on the second level of the Mall, such tenant shall be obligated to pay
an average annual fixed rent per net rentable square foot over the term of the
applicable Lease that is at least equal to the annual fixed rental rate per net
rentable square foot set forth on Exhibit 1 with respect to the second level of
the Mall;
(e) with respect to the portion of the leased premises, if any, that is
located in the Retail Annex, such tenant shall be obligated to pay an average
annual fixed rent per net rentable square foot over the term of the applicable
Lease that is at least equal to the annual fixed rental rate per net rentable
square foot set forth on Exhibit 1 with respect to the Retail Annex;
(f) for each lease year, for each level of gross revenue of the tenant
set forth on Exhibit 1, such tenant shall be obligated to pay, as percentage
rent, the relevant percentage (as set forth on Exhibit 1) of such tenant's gross
revenues for each lease year minus the minimum rent paid by the tenant for such
lease year; and
(g) in no event shall the annual fixed rent that is payable with
respect to any lease year be less than 100% of the annual fixed rent that was
payable with respect to the immediately preceding lease year.
Schedule I
1. An Affiliate of Borrower has been orally informed by
Clark County, Nevada that a portion of the Land along Sands Avenue may
be subject to a Taking for the widening of Sands Avenue.
Exhibit N
1. Escrow Agent shall be entitled to rely upon, and shall be fully protected
from all liability, loss, cost, damage or expense in acting or omitting to act
pursuant to, any instruction, order, judgment, certification, affidavit, demand,
notice, opinion, instrument or other writing delivered to it hereunder without
being required to determine the authenticity of such document, the correctness
of any fact stated therein, the propriety of the service thereof or the
capacity, identity or authority of any party purporting to sign or deliver such
document.
2. The duties of Escrow Agent are only as herein specifically provided, and are
purely ministerial in nature. Escrow Agent shall be required to act in respect
of the Junior Loan Documents only as provided in this Agreement. This Agreement
sets forth all the obligations of Escrow Agent with respect to any and all
matters pertinent to the escrow contemplated hereunder and no additional
obligations of Escrow Agent shall be implied from the terms of this Agreement or
any other agreement. Escrow Agent shall incur no liability in connection with
the discharge of its obligations under this Agreement or otherwise in connection
therewith, except such liability as may arise from the willful misconduct or
gross negligence of Escrow Agent.
3. Escrow Agent may consult with counsel of its choice, which may include
attorneys in the firm of Willkie Farr & Gallagher, and shall not be liable for
any action taken or omitted to be taken by Escrow Agent in accordance with the
advice of such counsel. Furthermore, Willkie Farr & Gallagher's acting as Escrow
Agent pursuant to this Agreement shall not preclude its representation of GSMC
or Syndication Agent in any other regard, including the negotiation,
consummation and enforcement of the Loan Documents and any dispute arising
thereunder or hereunder.
4. Escrow Agent is acting as a stakeholder only with respect to the Junior Loan
Documents. If any dispute arises as to whether Escrow Agent is obligated to
deliver the Junior Loan Documents or as to whom the Junior Loan Documents are to
be delivered, Escrow Agent shall not be required to make any delivery, but in
such event Escrow Agent may hold the Junior Loan Documents until receipt by
Escrow Agent of instructions in writing, signed by all parties which have, or
claim to have, an interest in the Junior Loan Documents, directing the
disposition of the Junior Loan Documents, or in the absence of such
authorization, Escrow Agent may hold the Junior Loan Documents until receipt of
a certified copy of a final judgment of a court of competent jurisdiction
providing for the disposition of the Junior Loan Documents. Escrow Agent may
require, as a condition to the disposition of the Junior Loan Documents pursuant
to written instructions, indemnification and/or opinions of counsel, in form and
substance satisfactory to Escrow Agent, from each party providing such
instructions. If such written instructions, indemnification and opinions are not
received, or proceedings for such determination are not commenced, within 30
days after receipt by Escrow Agent of notice of any such dispute (or if such
proceedings, once commenced, are not diligently pursued), or if the Escrow Agent
is uncertain as to which party or parties are entitled to the Junior Loan
Documents, Escrow Agent may either (i) hold the Junior Loan Documents until
receipt of (X) such written instructions and indemnification or (Y) a certified
copy of a final judgment of a court of competent jurisdiction providing for the
disposition of the Junior Loan Documents, or (ii) deposit the Junior Loan
Documents in the registry of a court of competent jurisdiction; provided,
however, that notwithstanding the foregoing, Escrow Agent may, but shall not be
required to, institute legal proceedings of any kind.
5. The parties to the Loan Agreement agree to reimburse Escrow Agent on demand
for, and to indemnify and hold Escrow Agent harmless against and with respect
to, any and all loss, liability, damage, or expense (including, without
limitation, reasonable attorneys' fees and costs) that Escrow Agent may suffer
or incur in connection with this Agreement and performance of its obligations
under this Agreement or otherwise in connection therewith, except to the extent
such loss, liability, damage or expense arises from the gross negligence or
willful misconduct of Escrow Agent.
6. Escrow Agent and any successor escrow agent may at any time resign as such by
delivering the Junior Loan Documents to either (i) any successor escrow agent
designated by all the parties hereto (other than Escrow Agent) in writing, or
(ii) any court having competent jurisdiction. Upon its resignation and delivery
of the Junior Loan Documents as set forth in this paragraph, Escrow Agent shall
be discharged of, and from, any and all further obligations arising in
connection with the escrow contemplated by this Agreement.