Exhibit
10.6
POOL
IX
THIS
DOCUMENT WAS, WITH THE
ADVICE
-
OF LOCAL COUNSEL, PREPARED BY:
Cynthia
J. Williams, Esq.
Day,
Berry & Howard
260
Franklin Street
Boston,
MA 02110
RECORDING
REQUESTED BY AND UPON
RECORDATION
RETURN TO:
Cynthia
J. Williams, Esq.
Day,
Berry & Howard
260
Franklin Street
Boston,
MA 02110
_____________________________________________________________________________________
(SPACE
ABOVE THIS LINE FOR RECORDER'S USE)
INDENTURE
OF MORTGAGE, DEED OF TRUST, SECURITY AGREEMENT,
FIXTURE
FILING,
FINANCING
STATEMENT AND ASSIGNMENT OF RENTS AND LEASES
dated
as of April 30, 1998
from
each
Owner listed on Schedule I attached hereto
with
respect to the related Mortgaged Property
and
each
Remainderman, if any, listed on Schedule I attached
hereto
with
respect to the related Mortgaged Property
collectively
as trustors or as mortgagors, as applicable
to
the
Trustee listed on Schedule I attached hereto with respect to
the
related
Mortgaged Property, as Trustee for the benefit of Lender, as
beneficiary
and
if no Trustee is listed on Schedule I attached
hereto
with
respect to the related Mortgaged Property, then
to
NOMURA
ASSET CAPITAL CORPORATION,
as
Lender and Mortgagee
THIS
INSTRUMENT IS TO BE INDEXED AS A DEED OF TRUST
IN
ARIZONA, CALIFORNIA, MISSOURI, NEVADA, TEXAS AND WEST
VIRGINIA,
AS
A MORTGAGE IN KENTUCKY, LOUISIANA, MICHIGAN AND
OHIO
AND AS A FIXTURE FILING IN ALL SUCH STATES
POOL
IX
MORTGAGE
dated
as of April 30, 1998
from
WILMINGTON
TRUST COMPANY, not in its individual capacity but
solely
as
Trustee of M-SIX PENVEST II BUSINESS TRUST under
Trust
Agreement dated as of April 22, 1998,
as
Owner
to
NOMURA
ASSET CAPITAL CORPORATION,
as
Lender and Mortgagee
THIS
INSTRUMENT SECURES FUTURE ADVANCES
Michigan
INDENTURE
OF MORTGAGE, DEED OF TRUST, SECURITY AGREEMENT, FIXTURE
FILING, FINANCING STATEMENT AND ASSIGNMENT OF RENTS AND LEASES
(this "Indenture"),
dated as of April 30, 1998, made by M-SIX PENVEST II BUSINESS
TRUST, a Delaware business trust, and each other Owner listed
on Schedule I hereto which is hereby incorporated by reference
herein through which it directly or indirectly holds title
either to a fee estate in, or an Estate for Years in, the Land
as specified on Schedule I hereto and in either case fee title
to the Improvements (together with their respective permitted
successors and assigns, referred to herein as "Owner"
either individually or collectively as appropriate in the
context used) and, if then applicable, each Remainderman
listed on Schedule I hereto, if any, which holds title to a
remainder estate in the Land (together with their respective
permitted successors and assigns, referred to herein as
"Remainderman"
either individually or collectively as appropriate in the
context used) each as a mortgagor or trustor of interests in
real property under this Indenture, and as debtor with respect
to the security interests in personal property hereby created,
in favor of, with respect to the Mortgaged Property located in
the States of Arizona, California, Missouri, Nevada, Texas and
West Virginia (collectively, the "Deed of Trust
States"), the title company or the individual shown as
Trustee on Exhibit A attached hereto with respect to the
related Mortgaged Property (together with any successor
trustee with respect to such Mortgaged Property hereunder,
"Trustee"),
-as trustee for the benefit of NOMURA ASSET CAPITAL
CORPORATION, a Delaware corporation (together with its
successors and assigns, "Lender"),
as beneficiary, and with respect to the Mortgaged Property
located in the States of Kentucky, Louisiana, Michigan and
Ohio (collectively, the "Mortgage
States"), to Lender, as mortgagee, in each case of
interests in real property under this Indenture, and as
secured party with respect to security interests in personal
property created under this Indenture. The mailing address of
each party hereto is set forth in Section 5.1. Capitalized
terms used herein shall have the meaning set forth in Article
I. So long as Schedule I attached hereto does not specify any
Person as a Remainderman, then wherever this Indenture refers
to Remainderman it shall be deemed to refer to "Remainderman,
if any,".
R E C I T A L S:
A. Owner
is the owner of either a fee estate in, or an Estate for Years
in the Land, as specified on Schedule I hereto, and is the
owner of fee title to the Improvements.
B. If
Owner is the owner of an Estate for Years in the Land, then
Owner and Remainderman have entered into the Option Agreement
setting forth the option of Owner to ground lease or purchase
the Land from Remainderman effective at the expiration of the
Estate for Years and Remainderman has agreed to subject its
interest in the Land to the lien of the
Indenture.
C. On
the date hereof, Lender has made a loan (the "Loan")
in the original principal amount of FIFTY-ONE MILLION NINE
HUNDRED THIRTY-FOUR THOUSAND FOUR HUNDRED EIGHTY-NINE AND
63/100 DOLLARS ($51,934,489.63) pursuant to the terms of the
Loan Agreement, which Loan is evidenced by the Note, made by
the Owners, as co-obligors and makers, in favor of Lender, or
order, as payee. Each Owner is wholly owned, directly or
indirectly, on the Closing Date by the same beneficial owner.
Each Owner has received good and valuable consideration for
its obligations hereunder and under the other Loan
Documents.
D. Owner
and Remainderman intend by the execution and delivery of this
Indenture to secure the payment and performance of the Loan
and all other Indebtedness of Owner to Lender.
E. Owner
and Remainderman intend these Recitals to be a material part
of this Indenture.
NOW, THEREFORE, in
consideration of the premises and for other good and valuable
consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as
follows:
I. This
Indenture shall be binding upon and inure to the benefit of
the parties hereto, and their respective successors and
assigns, and shall be deemed to be effective as of the date of
delivery hereof.
II. This
Indenture constitutes (a) a deed of trust with respect to the
Mortgaged Property located in Arizona, California, Missouri,
Nevada, Texas and West Virginia, (b) a mortgage with respect
to the Mortgaged Property located in Kentucky, Louisiana,
Michigan and Ohio and (c) a security agreement and fixture
filing encumbering the
Mortgaged
Property which constitutes personalty and fixtures in each
State, in each case upon the terms and conditions set forth
herein to secure the Loan and all other Indebtedness of Owner
to Lender.
III. Owner
represents and warrants that the original Principal Amount of
the Loan is evidenced by the Note and that this Indenture
constitutes a valid first priority lien on, and security
interest in, the Mortgaged Property securing the Loan
evidenced by the Note and all other Indebtedness of Owner to
Lender.
IV. With
respect to any particular State, the provisions of this
Indenture are subject to the Addendum with respect to such
State attached hereto as part of Section 5.16 and hereby
incorporated by reference herein. If any conflict exists
between the provisions of this Indenture and the Addendum with
respect to the related State, the Addendum shall control. Any
rights, powers and remedies provided in this Indenture as they
relate to Mortgaged Property located in a particular State may
be exercised only to the extent that the exercise thereof does
not violate applicable law of such State.
G R A N T I N G C L A U S E S
NOW, THEREFORE, for good
and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, and to secure
(i) the
payment of principal, interest, Default Rate Interest, if
any, Make Whole Premium, if any, Late Charges, if any,
Defeasance Deposit, if any, and all other sums and
indebtedness now or hereafter due and payable in connection
with the Loan made by Lender, as lender, to Owner, as
borrower, pursuant to that certain Loan Agreement, of even
date herewith (the "Loan
Agreement"), between Lender and Owner, which Loan is
evidenced by the Note and secured, in part, by this
Indenture,
(ii) payment
of all sums with interest thereon becoming due and payable to
Lender under this Indenture, the Loan Agreement, the Note,
the Master Lease Assignment or any other Loan
Document,
(iii) all
future advances which may be made by Trustee or by Lender to
or for the benefit of Owner or Remainderman (including,
without limitation, all funds which Trustee or Lender may
advance under this Indenture with respect to the Mortgaged
Property to pay for taxes, assessments, maintenance charges,
insurance premiums or costs, expenses incurred by Trustee or
by Lender by reason of default by Owner or Remainderman under
this Indenture, and other expenditures specified in this
Indenture), together with interest on such advances,
and
(iv) the
performance and discharge or each and every obligation,
covenant and agreement of Owner and of Remainderman or either
thereof under this Indenture, the Loan Agreement, the Note,
the Master Lease Assignment and any other Loan Document (the
obligations referred to in subsections (i), (ii), (iii) and
(iv) are herein collectively called the "Indebtedness").
Each
of Owner and Remainderman (a) has created a security interest
in favor of Trustee for the benefit of Lender in, and has
mortgaged, granted, conveyed, assigned, bargained, sold,
alienated, enfeoffed, confirmed, encumbered, hypothecated,
pledged, given, transferred and set over to Trustee for the
benefit of Lender, and by these presents does hereby create a
security interest in favor of Trustee for the benefit of
Lender in, and does hereby irrevocably mortgage, grant,
convey, assign, bargain, sell, alienate, enfeoff, confirm,
encumber, hypothecate, pledge, give, transfer and set over to
Trustee for the benefit of Lender, in trust, with power of
sale, all of the property described in the following Granting
Clauses located in the Deed of Trust States which constitutes
real property, subject only to Permitted Encumbrances, (b) has
created a security interest in favor of Lender in, and has
mortgaged and warranted, granted, conveyed, assigned,
bargained, sold, alienated, enfeoffed, confirmed, encumbered,
hypothecated, pledged, given, transferred and set over to
Lender, and by these presents does hereby create a security
interest in favor of Lender in, and does hereby irrevocably
mortgage and warrant, grant, convey, assign, bargain, sell,
alienate, enfeoff, confirm, encumber, hypothecate, pledge,
give, transfer and set over to Lender, with power of sale, all
of the property described in the following Granting Clauses
located in the Mortgage States which constitutes real
property, subject only to Permitted Encumbrances, and (c) has
created a security interest in favor of Lender in, and has
mortgaged, granted, conveyed,
assigned,
bargained, sold, alienated, enfeoffed, confirmed, encumbered,
hypothecated, pledged, given, transferred and set over to
Lender, and by these presents does hereby create a security
interest in favor of Lender in, and does hereby irrevocably
mortgage, grant, convey, assign, bargain, sell, alienate,
enfeoff, confirm, encumber, hypothecate, pledge, give,
transfer and set over to Lender, with power of sale, all of
the property described in the following Granting Clauses which
does not constitute real property, subject only to Permitted
Encumbrances, to the extent applicable to such property,
including the following:
Granting
Clause First
To Trustee in trust for the
benefit of Lender, all of Owner's and all of Remainderman's
right, title and interest, claim and demand in, to and under
the following described property located in the Deed of Trust
States, whether now owned or hereafter acquired, and to
Lender, all of Owner's and all of Remainderman's right, title
and interest, claim and demand in, to and under the following
described property located in the Mortgage States, whether
now owned or hereafter required:
Each of those parcels of
real property described in Exhibit A hereto (each, a
"Land
Parcel"
and collectively, the "Land");
TOGETHER with the
buildings, foundations, structures and improvements now or
hereafter located on or in any Land Parcel together with all
plumbing, electrical, ventilating, heating, cooling and other
utility systems, equipment, ducts, pipes an d other fixtures
attached to or comprising a part thereof (collectively, the
"Improvements");
TOGETHER with all
right, title and interest, if any, of each of Owner and
Remainderman in and to the streets and roads, opened or
proposed, abutting each Land Parcel, all strips and gores
within or adjoining each Land Parcel, the air space and right
to use the air space above each Land Parcel, all rights of
ingress and egress to and from each Land Parcel, all
easements, rights of way, reversions, remainders,
hereditaments, and appurtenances now or hereafter affecting
each Land Parcel or the Improvements thereon, all royalties
and rights and privileges appertaining to the use and
enjoyment of each Land Parcel or the Improvements thereon,
including all air, lateral support, alley, drainage, water,
oil, gas and mineral rights, options to purchase or lease,
and all other interests, estates or claims, in law or in
equity, which Owner or Remainderman now has or hereafter may
acquire in or with respect to each Land Parcel or the
Improvements thereon (collectively, the "Appurtenances");
and
TOGETHER with all
rents, income, revenues, issues, awards, proceeds and profits
from and in respect of the property described in this
Granting Clause First which are hereby (except as otherwise
set forth in Granting Clause Second) specifically assigned,
transferred and set over to Trustee for the benefit of Lender
with respect to the property located in the Deed of Trust
States and to Lender with respect to the property located in
the Mortgage States, it being the intention of the parties
hereto that, so far as may be permitted by law, all property
of the character hereinabove described which is now owned or
held or is hereafter acquired by Owner or by Remainderman and
is affixed, attached and annexed to the Land shall be and
remain or become and constitute a portion of the Mortgaged
Property and the security covered by and subject to the lien
hereof. A Land Parcel together with the Improvements, the
Appurtenances and the other property described in this
Granting Clause First relating thereto are herein
collectively called "Property";
Granting
Clause Second
To
Trustee in trust for the benefit of Lender and to Lender, all
of Owner's and all of Remainderman's right, title, and
interest, claim and demand in, to and under the following
described property located in the Deed of Trust States,
whether now owned or hereafter acquired, and to Lender, all of
Owner's and all of Remainderman's right, title, and interest,
claim and demand in, to and under the following described
property located in the Mortgage States, whether now owned or
hereafter acquired: All furnaces, boilers, machinery, motors,
compressors, elevators, fittings, piping, conduits, ducts, air
conditioners, partitions, mechanical, electrical and HVAC
systems and apparatus of every kind and all other fixtures,
equipment and other personalty owned by Owner (and
Remainderman, as to the residual interest therein) and located
on, attached, affixed or incorporated into the Land and
Improvements including, without limitation, all seating,
tables, beds, draperies, cabinetry, chairs, mirrors,
nightstands, furniture, furniture accessories, bathroom
accessories, floor coverings, curtains, lighting, appliances,
lighting, tableware, table accessories, kitchen and laundry
equipment, audio-visual equipment, wall decorations, office
furniture, office and conference accessories, television
wiring and jacks, and other miscellaneous furniture, fixtures
and equipment now or hereafter located on the Land and used in
the operation of the Improvements, including, without
limitation, all replacements thereof (collectively the
"FF&E"),
in which Owner (and Remainderman, as to the residual interest
therein, if any) now or hereafter has a possessory or title
interest and now or hereafter installed or located in or on
any Property (excluding Tenant's Personal Property) and all
building materials, supplies and equipment now or hereafter
delivered to Property owned by Owner (and Remainderman, as to
the residual interest therein, if any) and intended to be
installed therein; all fixtures, other goods and personal
property of whatever kind and nature now contained on or in or
hereafter placed on or in Property and used or to be used in
connection with the letting or operation thereof, in which
Owner (and Remainderman, as to the residual interest therein,
if any) now has or hereafter may acquire a possessory or title
interest (but specifically excluding inventory) and all
renewals or replacements of any of the foregoing property or
articles in substitution thereof (collectively, the
"Equipment");
Granting
Clause Third
To Lender, all of Owner's
and all of Remainderman's right, title and interest, claim
and demand in, to and under the following described property,
whether now owned or hereafter acquired:
All right, title and
interest of Owner (and Remainderman, as to the residual
interest therein, if any), whether now or hereafter acquired
and wherever located, in, to and under all accounts and
escrows (including each Cash Collateral Account), documents,
instruments, chattel paper, claims, deposits, money,
investment securities (including Permitted Investments) and
general intangibles, as the foregoing terms are defined in
the Code, all property and insurance policies, title
insurance policies, all contract rights (including all
construction contracts, architects' contracts and engineers'
contracts or other contracts relating to the construction of
any Improvements and all Appurtenant Agreements), franchises,
books, records, plans, specifications, designs, drawings,
permits, consents, licenses (to the extent assignable),
approvals, actions, proceedings and causes of action (and,
subject to the provisions of this Indenture, the right, in
the name and on behalf of Owner and/or Remainderman, to
appear in and defend the same and to commence the same with
respect to the Mortgaged Property to protect the interest of
Trustee and/or Lender hereunder after written notice to Owner
and/or Remainderman of Lender's intent to do so provided that
no such written notice is required if such right is otherwise
expressly permitted in this Indenture or if any Event of
Default has occurred and is continuing) which now or
hereafter relate to, are derived from or used in connection
with Property or the ownership, construction, use, operation,
maintenance, occupancy or enjoyment thereof or the conduct of
any business or activities thereon (collectively, the
"Intangibles");
TOGETHER with all
right, title and interest of Owner (and Remainderman, as to
the residual interest therein, if any), whether now or
hereafter acquired and wherever located, in, to and under the
Master Lease, and all other leases, subleases, lettings,
tenancies and licenses (to the extent assignable) of a
Property or any part thereof now or hereafter entered into
and all amendments, extensions, renewals and guaranties
thereof, all security therefor, and all moneys payable
thereunder (collectively, the "Leases");
TOGETHER with all
Basic Rent, Additional Rent, other rents, income, issues,
profits, Loss Proceeds, purchase prices, payments of
Stipulated Loss Value, security deposits and other benefits
to which Owner or Remainderman may now or hereafter be
entitled from a Property, the Equipment or the Intangibles
related thereto, or under or in connection with the Leases,
including, without limitation, all income received from
tenants, transient guests, lessees, licensees and
concessionaires and other persons occupying space at such
Property and/or rendering services to tenants thereat
(collectively, the "Property
Income"); provided,
however,
that Property Income shall not include the Excepted Payments
and Property Income shall not include any Excess Property
Income, which has been released and paid to Owner in
accordance herewith;
TOGETHER with all
proceeds, judgments, claims, compensation, awards of damages
and settlements with respect to or hereafter made as a result
of or in lieu of any condemnation or taking of a Property by
eminent domain or by any defect or impairment of title with
respect
to
any Property or any casualty loss of or damage to any
Property, the Equipment, the Intangibles, the Leases or the
Property Income related thereto, all refunds with respect to
the payment of property taxes and assessments or with respect
to insurance premiums, and all other proceeds of the
conversion, voluntary or involuntary, of a Property, the
Equipment, the Intangibles, the Leases or the Property Income
related thereto, or any part thereof, into cash or liquidated
claims (collectively, the "Proceeds");
and
TOGETHER with all
right, title and interest of Owner, now existing or hereafter
arising, in and to the Option Agreement, if any, the
Tripartite Agreement, if any, the Master Lease, the Master
Lease Guaranty, the Residual Value Policy and all other
instruments and agreements (including title insurance
policies) relating to the ownership, operation, maintenance,
leasing, financing or management of the Property
(collectively, the "Granting
Clause
Documents") and all sums now or hereafter payable to
Owner with respect thereto, including, without limitation,
the present and continuing right to make claim for, collect,
receive and receipt for any and all of the rents, payments,
income, revenues, issues, awards, proceeds and profits and
other sums of money payable or receivable thereunder, whether
payable as rent or otherwise, including, without limitation,
sums of money receivable by Owner thereunder by virtue of a
release of existing easements or other rights in the nature
of easements or by virtue of a dedication or transfer of
unimproved portions of the Land Parcel, to accept or reject
any Rejectable Offer made pursuant to the Master Lease to
purchase any interest in the Mortgaged Property, to accept or
reject any Rejectable Substitution Offer pursuant to the
Master Lease, to exercise any election or option or to make
any decision or determination or to give or receive any
notice, consent, waiver or approval or to take any other
action under or in respect of, and to bring actions and
proceedings under the Granting Clause Documents or for the
enforcement thereof and to do anything which Owner is or may
become entitled to do under the Granting Clause Documents
(including, without limitation, all of Owner's right, title,
interest and estate in, to and under any and all warranties
and other claims against dealers, manufacturers, vendors,
contractors, subcontractors, architects and others relating
to the construction, use or maintenance of the Landlord
Interest), as well as all rights, powers and remedies on the
part of Owner, now existing or hereafter arising and whether
arising under the Granting Clause Documents, or by statute or
at law or equity or otherwise (the Equipment, the
Intangibles, the Leases, the Property Income, the Proceeds,
the Landlord Interest and the Granting Clause Documents are
hereinafter collectively referred to as the "Collateral";
as the context may require, the "Mortgaged
Property" refers to a particular Property and the
Collateral related thereto and/or the "Mortgaged
Property" refers to each, every and all Property and
Collateral encumbered by this Indenture and all other
properties and collateral encumbered by the Other Indentures
securing the Note), provided that the assignment made by this
Granting Clause Third shall be subject to the provisions of
the Master Lease Assignment and this Indenture and shall not
impair or diminish any obligation of Owner under the Granting
Clause Documents nor shall any such obligation be imposed
upon Lender;
BUT EXCLUDING, HOWEVER,
from the Mortgaged Property any and all Excepted Payments now
existing or hereafter arising and subject to provisions of
the Master Lease Assignment relating to certain
exclusions;
WITH
MORTGAGE COVENANTS and with all POWERS OF SALE, STATUTORY
POWERS OF SALE and other STATUTORY RIGHTS AND COVENANTS and
upon the STATUTORY CONDITIONS in each state in which a
Property is located in which such
powers,
statutory rights, covenants and conditions are
valid;
TO
HAVE AND TO HOLD the Mortgaged Property, with all the
privileges and appurtenances to the same belonging, and with
the possession and right of possession thereof, unto Trustee
in trust for the benefit of Lender, or Lender, as applicable,
and their respective successors and assigns forever, subject
to the terms hereof; and
IT
IS HEREBY COVENANTED, DECLARED AND AGREED that the Note and
any other Indebtedness of Owner to Lender are to be secured by
this Indenture, that the Mortgaged Property is to be held, as
applicable, by Trustee in trust for the benefit of Lender and
by Lender upon and subject to the provisions of this
Indenture.
If
a Land Parcel is located in one of the Mortgage States, this
Indenture shall be considered a mortgage on the Mortgaged
Property located in such states granted to Lender, its
successors and assigns, and if a Land Parcel is located in one
of the Deed of Trust States, this Indenture shall be
considered a deed of trust or a trust deed, as applicable, on
the Mortgaged Property located in such states granted to
Trustee in trust for the benefit of Lender, or to Lender, as
applicable, their respective successors and
assigns.
The
Master Lease is intended to be recorded prior to this
Indenture. So long as no Lease Event of Default exists and is
continuing, Lender shall not join Tenant nor any sublessee as
a defendant in any action to foreclose upon the Mortgaged
Property and, upon foreclosure of all or any portion of the
Mortgaged Property by judicial proceedings or otherwise,
neither Trustee, if applicable, nor Lender shall be entitled
nor shall seek to terminate the Master Lease or any sublease
provided that Tenant, from and after the date of such
succession, attorns to Lender, or any transferee of the
Mortgaged Property by foreclosure or by transfer in lieu of
foreclosure, from or after the date of such succession, under
the then executory terms of the Master Lease.
ARTICLE
1
Definition of Terms
For all purposes of this
Indenture, except as otherwise expressly required or unless
the context clearly indicates a contrary intent:
(1) the
capitalized terms defined in this Article have the meanings
assigned to them in this Article, include the plural as well
as the singular, and, when used with respect to any contract,
include all extensions, modifications, amendments and
supplements from time to time thereto;
(2) all
accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP (as
hereinafter defined) in effect on the date
hereof;
(3) the
words "herein," "hereof," and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to
any particular Article, Section, or other
subdivision;
(4) the
words "include" and "including" and other words of similar
import shall be construed as if followed by the phrase ",
without limitation,"; and
(5) any
provision of this Indenture permitting the recovery of
attorneys' fees and costs shall be deemed to include such
fees and costs incurred in all appellate
proceedings.
As used in this Indenture,
the terms set forth below shall have the following
meanings:
"Actual
Defeasance Amount" shall have the meaning provided in
Section 4.6 hereof.
"Additional
Rent" shall have the meaning provided in the Master
Lease.
"Advances"
shall mean all sums, amounts or expenses advanced or paid,
and all costs incurred, by Trustee or by Lender, as provided
herein or in any other Loan Document and secured hereby, upon
failure of Owner or Remainderman to pay or perform any
obligation or covenant contained herein or in any such other
Loan Document,
"Affiliate"
of any specified Person shall mean any other Person directly
or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person or who is
a director or officer of such specified Person or of an
Affiliate of 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 interest,
by contract or otherwise; and the terms "controlling" and
"controlled" have the meanings correlative to the
foregoing.
"Allocated
Property Debt" shall mean, with respect to a
particular Mortgaged Property, the original allocated
property debt set forth on Exhibit B hereto with respect to
such Mortgaged Property, multiplied by a fraction, the
numerator of which equals the outstanding principal balance
of the Note at the time the calculation is made and the
denominator of which equals (a) the original outstanding
principal balance of the Note, minus (b) the original
allocated property debt (as set forth on said Exhibit B) of
any other Mortgaged Property which has been released from the
lien of this Indenture.
"ALTA"
shall mean American Land Title Association, or any successor
thereto.
"Alteration"
shall have the meaning provided in Section 2.3(c)
hereof.
"Appraisal"
shall mean any appraisal of a Property made by an Appraiser,
together with any update thereto and recertification
thereof.
"Appraiser"
shall mean an Independent appraiser selected by Lender who is
a member of the American Institute of Real Estate Appraisers
with a national practice and which has at least ten (10)
years experience with real estate of the same type and in the
geographic area of
the
Property.
"Appurtenances"
shall have the meaning provided in the Granting Clauses
hereof.
"Appurtenant
Agreements" shall mean all reciprocal easements, cross
easements and/or similar types of agreements affecting the
Mortgaged Property.
"Architect"
shall mean a reputable architect registered or licensed as
such in the State.
"Assumed
Properties," shall have the meaning provided in
Section 2.16(a) hereof.
"Assumption"
shall have the meaning provided in Section 2.16(a)
hereof.
"Assumption
Date" shall have the meaning provided in Section
2.16(a) hereof.
"Authorized
Representative" shall mean (i) with respect to any
Person that is a partnership, an Authorized Representative of
the general partner of such partnership, (ii) with respect to
any Person that is a corporation, any executive officer of
such corporation, (iii) with respect to any Person that is a
trust, the trustee of such trust, and, if such trustee is a
corporate trustee, any corporate trust officer of such
corporation, and (iv) with respect to any Person that is a
limited liability company, the manager or any authorized
member of such limited liability company.
"Balloon
Payment" shall mean the payment of the outstanding
principal balance of the Note due on the Maturity Date of the
Note.
"Bankruptcy
Proceeding"
shall mean any proceeding, action, petition or filing under
the Federal Bankruptcy Code or any similar state or federal
law now or hereafter in effect relating to bankruptcy,
reorganization, dissolution, termination, liquidation,
receivership or insolvency, or the arrangement or adjustment
of debts.
"Basic
Rent" shall have the meaning provided in the Master
Lease.
"Business
Day" shall mean any day other than a Saturday, Sunday
or any other day on which banking or savings and loan
institutions in the State of New York are authorized or
required to be closed.
"Cash
Collateral Account" shall mean each of the Central
Account, the Defeasance Account and the Restoration
Account.
"Central
Account" shall mean an Eligible Account, maintained in
the name of Lender, its successors and assigns, as secured
party, or as may be otherwise designated by Lender, into
which Basic Rent and all other payments due from Tenant to
Owner shall be deposited.
"Closing
Date" shall mean the date on which the Note is
delivered.
"Code"
shall mean the Uniform Commercial Code as in effect from time
to time in the State, including any amendments, modifications
or successor statutes thereto, and, to the extent that any of
the Collateral (including any Cash Collateral Account) is not
governed by the Uniform Commercial Code in the State, the
defined term "Code" shall include any applicable common law
or statute in the State relating to the perfection and/or
priority of Lender's security interest therein.
"Collateral"
shall have the meaning provided in the Granting Clauses
hereof.
"Collateral
Security Instrument" shall mean any right, document or
instrument, other than this Indenture, given as security for
the Note or any other Indebtedness (including, without
limitation, the Master Lease Assignment).
"Condemnation
Proceeds" shall mean all proceeds, awards or other
amounts paid or payable in connection with any Taking of all
or any portion of the Mortgaged Property.
"Controlling
Interest" shall mean any Equity Interest in Owner
through which the power to direct the management and policies
of Owner, directly or indirectly, whether through the
ownership of voting securities or other beneficial interest,
by contract or otherwise, may be exercised.
"Debt Service
Payment" shall have the meaning provided in the Note
and shall include, without limitation, the scheduled
principal and/or interest payments and the Balloon Payment
provided for therein.
"Deed of Trust
States" shall mean the States of Arizona, California,
Missouri, Nevada, Texas and West Virginia.
"Default"
shall mean the occurrence of any event hereunder or under any
other Loan Document which, with or without the giving of
notice or the passage of time, or both, would be an Event of
Default.
"Default
Collateral" shall have the meaning provided in Section
4.3(z) hereof.
"Default
Rate" shall mean a per annum interest rate equal to
the lesser of (a) the Maximum Amount and (b) the sum of four
percent (4%) plus the Fixed Rate.
"Default Rate
Interest" shall mean, to the extent the Default Rate
becomes applicable, interest which accrues on any defaulted
amount at the Default Rate from and including the date such
defaulted amount first became due and payable to but not
including the date of payment in full thereof.
"Defeasance
Account" shall mean an Eligible Account in the name of
Lender, its successors and assigns, or as maybe otherwise
designated by Lender, into which all amounts received by
Lender in connection with any prepayment or defeasance of the
Note shall be deposited.
"Defeasance
Deposit" shall mean an amount equal to the sum of (i)
an amount sufficient to purchase U.S. Obligations which
provide payments that will meet the Scheduled Defeasance
Payments, (ii) any costs and expenses incurred or to be
incurred in the purchase of such U.S. Obligations, and (iii)
any other costs and expenses required to accomplish the
agreements of Section 2.20 hereof.
"Defeasance
Event" shall have the meaning provided in Section
2.20(c) hereof. "Defeasance
Release Date" shall have the meaning provided in
Section 2.20(c) hereof.
"Defeasance
Security Agreement" shall have the meaning provided in
Section 2.20(c) hereof.
"Defeased
Note" shall have the meaning provided in Section
2.20(a) hereof.
"Delaware
Business Trust" shall mean a Delaware business trust
which has an Independent Trustee and with respect to which
Lender and the Rating Agencies shall have received (i) a
certificate from the trustee of such Delaware business trust
certifying that it is an Independent Trustee and attaching a
certified copy of the trust agreement which satisfies, at the
trust level, the requirements of a Single Purpose Entity,
(ii) an opinion of Delaware counsel addressed to the Lender
and to the Rating Agencies stating that under the laws of the
State of Delaware (A) neither a Delaware court nor a Federal
court sitting in Delaware would permit such beneficial owner
to terminate the trust agreement of the Owner except as
otherwise provided therein, until the final discharge of this
Indenture and the sale or other final disposition by the
Independent Trustee of all property constituting part of the
Collateral and until payment in full of all of the
Indebtedness of Owner under this Indenture and the Note, and
(B) as long as the trust agreement has not been terminated in
accordance with its terms or with the consent of Lender,
creditors and representatives of creditors of such beneficial
owner and holders of a lien against the assets of such
beneficial owner, such as trustees, receivers or liquidators,
whether or not any insolvency proceeding has been commenced,
may acquire legal, valid and enforceable claims and liens, as
to the trust estate of Owner, only against the beneficial
interest of such beneficial owner in such trust estate, and
do not have, and may not through the enforcement of such
creditors' rights acquire, any greater rights than the rights
of the beneficial owner with respect to such trust estate and
(iii) an opinion of local counsel in the State that either
(A) state and Federal courts sitting in the State would apply
the laws of the State of Delaware to any matter raised in
connection with (1) the dissolution or liquidation of the
trust and (2) the rights of creditors of beneficial owners of
the trust with respect to their beneficial interests in the
trust and with respect to the assets of the trust, or (B)
such courts would apply the law of the State, and giving the
same opinions with respect to the State as are set forth in
clauses (ii)(A) and (ii)(B) above.
"Duff"
shall mean Duff & Phelps Credit Rating Co., or any
successor thereto.
"Eligible
Account" shall mean either (a) a segregated account
maintained with a federal or state chartered depository
institution or trust company which complies with the
definition of Eligible Institution; or (b) a segregated trust
account maintained with a federal or state chartered
depository institution or trust company with corporate trust
powers acting in its fiduciary capacity which, in the case of
a state-chartered depositary institution or trust company is
subject to regulations substantially similar to 12 C.F.R.
§ 9.10(b), having in either case a combined capital and
surplus of at least $50,000,000 and subject to supervision or
examination by federal and state authority.
"Eligible
Institution" shall mean a depository institution or
trust company the short term unsecured debt obligations or
commercial paper of which are rated at least A-1 by S&P,
P-1 by Moody's, D-1 by Duff and F-1 + by Fitch in the case of
accounts in which funds are held for 30 days or less (or, in
the case of accounts in which funds are held for more than 30
days, the long term unsecured debt obligations of which are
rated at least "AA" by Fitch, Duff and S&P and "Aaa" by
Moody's).
"Engineer"
shall mean an engineer or engineering firm approved by
Lender, in its reasonable discretion.
"Environmental
Claim" shall mean any claim, action, investigation or
written notice by any Person alleging potential liability
(including, without limitation, potential liability for
investigatory costs, cleanup costs, governmental response
costs, natural resources damages, property damages, personal
injuries or penalties) arising out of, based on or resulting
from (i) the presence, or release into the environment, of
any Hazardous Substance (as hereinafter defined) at the
Mortgaged Property or (ii) circumstances forming the basis of
any violation, or alleged violation, of any Environmental
Law.
"Environmental
Consultant" shall mean an Independent environmental
consultant or environmental firm reasonably approved by
Lender.
"Environmental
Law" shall mean any present or future federal, state
or local law, statute, regulation or ordinance, and any
judicial or administrative order or judgment thereunder, and
judicial opinions or orders, pertaining to health, industrial
hygiene, Hazardous Substances or the environment, including,
but not limited to, each of the following, as enacted as of
the date hereof or as hereafter amended: the Comprehensive
Environmental Response, Compensation and Liability Act of
1980, 42 U.S.C. §§ 9601 et seq.; the Resource
Conservation and Recovery Act of 1976, 42 U.S.C. §§
6901 et seq.; the Toxic Substance Control Act, 15 U.S.C.
§§ 2601 et seq.; the Water Pollution Control Act
(also known as the Clean Water Act), 33 U.S.C.
§§1251 et seq.; the Clean Air Act, 42 U.S.C.
§§7401 et seq.; and the Hazardous Materials
Transportation Act, 49 U.S.C. §§1801 et
seq.
"Environmental
Report" shall mean the environmental report relating
to the Mortgaged Property prepared by an Environmental
Consultant and delivered to Lender in connection with the
Loan and which Owner shall bear the cost of
obtaining.
"Environmental
Violation" shall have the meaning provided in Section
2.22(c)(iv).
"Equipment"
shall have the meaning provided in the Granting Clauses
hereof and shall include, without limitation, the
FF&E.
"Equity
Interests" shall mean (i) if Owner is a partnership,
partnership interests in Owner, or (ii) if Owner is a limited
liability company, membership interests in Owner;
or
(iii)
if Owner is a corporation, the share or stock interests in
Owner or (iv) if Owner is a trust, the partnership,
membership, share or stock interests of each entity which is a
beneficial owner of such trust; provided,
however,
that Equity Interests shall also include any direct or
indirect legal or beneficial ownership interest, or any other
interest of any nature or kind whatsoever, of any SPE Equity
Owner in Owner or in any SPE Equity Owner of any SPE Equity
Owner in Owner, as applicable.
"Estate for
Years" shall mean the estate for years owned by Owner
in a particular Land Parcel, for a term expiring April 30,
2019.
"Estimated
Cost" shall have the meaning provided in Section
2.3(c) hereof.
"Event of
Default" shall have the meaning set forth in Section
4.1 hereof.
"Event of
Loss" shall mean, with respect to any Mortgaged
Property, any event that results in Tenant making a
Rejectable Offer or a Rejectable Substitution Offer in
accordance with Section 3.3(a) of the Master Lease, which
Rejectable Offer is accepted or deemed accepted by Owner or
which Rejectable Substitution Offer is accepted by Owner, in
either case in accordance with the Master Lease Assignment
and the Master Lease.
"Excepted
Payments" shall mean (i) any amounts payable as
Additional Rent under the Master Lease to Owner (other than
payments of Stipulated Loss Values, purchase prices,
Make-Whole Premiums and Loss Proceeds which are otherwise
required to be paid to Owner under the Master Lease and other
than amounts which are specifically required to be paid to
Lender under the Master Lease), including all indemnity
payments to which Owner (or its successors and assigns (other
than Lender), agents, officers, directors or employees) is
entitled under the Granting Clause Documents; (ii) provided
that no Event of Default has occurred and is continuing, any
amounts other than Basic Rent and payments of Stipulated Loss
Value, purchase prices, and Make-Whole Premiums payable under
any Granting Clause Document to reimburse Owner (including
the reasonable expenses of Owner incurred in connection with
any such payment) for performing or complying with any of the
obligations of Tenant under and as permitted by any Granting
Clause Document; and (iii) any insurance proceeds (or
payments with respect to risks self-insured or policy
deductibles) under general public liability policies payable
to, or maintained by, Owner or any Affiliate of
Owner.
"Excess
Property Income" shall mean, on any Payment Date after
payment of (i) the current Debt Service Payment (including
the Balloon Payment), if any, and (ii) any other Indebtedness
of Owner then due and payable, the remaining amount, if any,
available in the Central Account on such Payment Date,
excluding any amounts then held in any subaccount of the
Central Account.
"Federal
Bankruptcy Code" shall mean Title 11 of the United
States Code, as amended or superseded from time to
time.
"FF&E"
shall have the meaning provided in the Granting Clauses
hereof.
"Financing
Statement" shall mean any financing statement filed or
recorded under the Code showing Owner, as debtor, and Lender,
as secured party, relating to any Collateral.
"First Payment
Date" shall have the meaning provided in the
Note.
"Fiscal
Year" shall mean each twelve (12) month period
commencing on January 1 and ending on December 31 during each
year of the term of this Indenture.
"Fitch"
shall mean Fitch IBCA, Inc., or any successor
thereto.
"Fixed
Rate" shall have the meaning provided in the
Note.
"FMV Option
Notice" shall have the meaning provided in the Master
Lease.
"FMV Option
Price" shall have the meaning provided in the Master
Lease.
"FMV Purchase
Option" shall have the meaning provided in the Master
Lease.
"FMV Purchase
Option Closing Date" shall have the meaning provided
in the Master Lease.
"GAAP"
shall mean generally accepted accounting principles in the
United States of America as in effect as of the date of the
applicable financial report and consistently
applied.
"Governmental
Authority" shall mean any federal, state, regional or
local government or political subdivision thereof and any
Person exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to
government.
"Granting
Clause Documents" shall have the meaning provided in
the Granting Clauses hereto.
"Hazardous
Substance" shall mean any material, waste or substance
which is:
|
(i)
|
included
within the definitions of "hazardous substances," "hazardous
materials," "toxic substances," or "solid waste" in or pursuant to
any Environmental Law, or subject to regulation under any
Environmental Law;
|
(ii) listed in the United States
Department of Transportation Optional Hazardous Materials Table, 49
C.F.R. § 172.101, as enacted as of the date hereof or as
hereafter amended, or in the United States Environmental Protection
Agency List of Hazardous Substances and Reportable Quantities, 40
C.F.R. Part 302, as enacted as of the date hereof or as hereafter
amended; or
|
(iii)
|
explosive,
radioactive, friable asbestos, a polychlorinated biphenyl,
petroleum or a petroleum product or waste oil.
|
"Impositions"
shall mean (i) all taxes (including, without limitation, all
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 prior to the date hereof and
whether or not commenced or completed within the term of this
Indenture), 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,
or foreseen or unforeseen, of every character in respect of
Owner, the Mortgaged Property and/or any Property Income
(including 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 (a)
Owner (including, without limitation, all income, franchise,
single business or other taxes imposed on Owner for the
privilege of doing business in any jurisdiction in which the
Mortgaged Property, or any other collateral delivered or
pledged to Lender in connection with the Loan, is located) or
Lender, (b) the Mortgaged Property, or any other collateral
delivered or pledged to Lender in connection with the Loan,
or any part thereof, or any Property Income therefrom or any
estate, right, title or interest therein, or (c) any
occupancy, operation, use or possession of, or sales from, or
activity conducted on, or in connection with the Mortgaged
Property or the leasing or use thereof or any part thereof,
or the acquisition or financing of the acquisition of the
Mortgaged Property by Owner, (ii) all transfer, recording,
stamp and real property gain taxes incurred upon the sale,
transfer, foreclosure or other disposition of the Mortgaged
Property or any interest therein, (iii) all offers, claims
and demands of mechanics, laborers, material men and others
which, if unpaid, might create a lien on the Mortgaged
Property or on the Property Income, (iv) all charges for
utilities, communications and similar services servicing the
Mortgaged Property and (v) if any law is enacted or adopted
or amended after the date of this Indenture which deducts all
or any portion of the Indebtedness from the value of the
Mortgaged Property for the purpose of taxation or which
imposes a tax directly or indirectly on all or any portion of
the Indebtedness or on Landlord's Interest in the Mortgaged
Property, the taxes imposed by such law. Nothing contained in
this Indenture shall be construed to require Owner to pay any
tax, assessment, levy or charge imposed on any of the Lender
Parties which are the nature of a franchise, capital levy,
estate, inheritance, succession, sales, income or net revenue
tax.
"Improvements"
shall have the meaning provided in the Granting Clauses
hereto.
"Indebtedness"
shall have the meaning provided in the Granting Clauses
hereto.
"Independent"
shall mean, when used with respect to any Person, a Person
who (i) is in fact independent, (ii) does not have any direct
financial interest or any material indirect financial
interest in Owner, or in any Affiliate of Owner, or any
constituent shareholder, member, beneficiary or partner of
Owner, (iii) is not connected with Owner, or any Affiliate of
Owner, or any constituent shareholder, member, beneficiary or
partner of Owner, as an officer, employee, promoter,
underwriter, trustee, partner, director or person performing
similar functions, and (iv) is not a member of the immediate
family of a Person described in clause (ii) or (iii) above.
Whenever it is herein provided that any Independent Person's
opinion or certificate shall be provided, such opinion or
certificate shall state that the Person executing the same
has read this definition and is Independent within the
meaning hereof.
"Independent
Director" shall mean a duly appointed member of the
board of directors of the relevant entity who shall not have
been, at the time of such appointment, at any time after
appointment, or at any time in the preceding five (5) years,
(i) a stockholder, director, officer, manager, employee,
partner, attorney or counsel of such entity or of a direct or
indirect legal or beneficial owner in such entity or any of
its Affiliates, (ii) a customer of or, supplier, to such
entity or any of its shareholders or Affiliates, (iii) a
person who controls such entity or any of its Affiliates, or
(iv) a member of the immediate family of a person defined in
(i), (ii) or (iii)
above. As used herein, the term "control" means the
possession, directly or indirectly, of the power to direct or
cause the direction of the management, policies or activities
of a Person, whether through ownership of voting securities,
by contract or otherwise.
"Independent
Trustee" shall mean an individual or corporation or
bank who is not and for the prior five years has not been (i)
a stockholder, director, officer, employee, partner, attorney
or counsel of Owner or of any beneficial owner of Owner or of
any Affiliate of either of them, (ii) a customer, creditor,
supplier or other Person who, during the immediately
preceding fiscal year, derived more than 10% of its purchases
or gross revenues from its activities with Owner, any
beneficial owner of Owner or any Affiliate of either of them,
or (iii) a Person controlling or under common control with
any such stockholder, partner, customer, creditor, supplier
or other Person; or (iv) a member of the immediate family of
any such stockholder, director, officer, employee, partner,
customer, supplier or other Person. As used herein, the term
"control" means the possession, directly or indirectly, of
the power to direct or cause the direction of the management,
policies or activities of a Person, whether through ownership
of voting securities, by contract or otherwise. The initial
Independent Trustee shall be Wilmington Trust
Company.
"Insurance
Proceeds" shall mean all proceeds or payments received
or receivable under any insurance policy required to be
maintained pursuant to Section 2.3 or 2.4 hereof in
connection with any fire, flood or other casualty affecting
all or any portion of the Mortgaged Property.
"Intangibles"
shall have the meaning provided in the Granting Clauses
hereto.
"Investment
Grade Rating" shall mean a solicited long term
unsecured debt rating of (i) BBB or better by S&P, (ii)
BBB or better by Fitch (if such Person then has a solicited
long term unsecured debt rating by Fitch), (iii) BBB or
better by Duff (if such Person then has a solicited long term
unsecured debt rating by Duff), and (iv) Baa2 or better by
Moody's (if such Person then has a solicited long term
unsecured debt rating by Moody's).
"I.R.C."
shall mean 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 promulgated thereunder in temporary or final
form, or in proposed form, if by reason of their effective
date, such regulations would apply to the transactions
contemplated by the Operative Documents.
"Land"
shall have the meaning provided in the Granting Clauses
hereto.
"Land
Parcel" shall have the meaning provided in the
Granting Clauses hereto.
"Landlord's
Interest" shall mean (i) if Owner owns a fee estate in
each Property as specified on Schedule I hereto, such fee
estate, and (ii) if Owner owns an Estate for Years in each
Property as specified on Schedule I hereto, fee title to the
Improvements on, the Estate for Years in, and the rights of
Owner under the Option Agreement and the Tripartite Agreement
with respect to, each Land Parcel.
"Late
Charge" shall have the meaning provided in the
Note.
"Lease Event of
Default" shall mean an Event of Default as defined in
the Master Lease.
"Lease
Termination Date" shall have the meaning provided in
the Master Lease.
"Leases"
shall have the meaning provided in the Granting Clauses
hereto.
"Legal
Requirements" means all federal, state, county,
municipal and other governmental statutes, laws, rules,
orders, regulations, ordinances, judgments, decrees and
injunctions of Governmental Authorities (including, without
limitation, Environmental Laws) affecting Owner,
Remainderman, the Mortgaged Property or any part thereof or
the ownership, leasing, 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, and all
covenants, agreements, restrictions and encumbrances
contained in any Appurtenant Agreements or other instruments,
contracts, documents or insurance policies, either of record
or known to Owner, at any time in force affecting the
Mortgaged Property or any part thereof, including, without
limitation, any which may (i) require repairs, modifications
or alterations in or to the Mortgaged Property or any part
thereof, or (ii) in any way limit the use and enjoyment
thereof.
"Lender"
shall mean Nomura Asset Capital Corporation, a Delaware
corporation, and its successors and assigns.
"Lender
Parties" shall mean Lender and its successors in
interest and assigns and servicing agents, and their
respective affiliates, subsidiaries, parents, employees,
officers, shareholders, partners, members, managers,
trustees, beneficial owners, directors and
agents.
"Lender
Party" shall mean any one of the Lender Parties
individually.
"Lien"
shall mean any mortgage, deed of trust, deed to secure debt,
lien, pledge, hypothecation, assignment, security interest,
or any other encumbrance, charge or transfer of, on or
affecting the Mortgaged Property or any portion thereof or
Owner, or any 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, and mechanic's, materialmen's and other
similar liens and encumbrances.
"Loan"
shall have the meaning provided in the Recitals
hereto.
"Loan
Agreement" shall have the meaning provided in the
Granting Clauses hereto. "Loan
Amount" shall mean the face amount of the
Note.
"Loan
Documents" shall mean the Loan Agreement, the Note,
this Indenture, the Master Lease Assignment, the Tenant
Consent, UCC-1 Financing Statements and each other
instrument, contract, document, securities law
indemnification agreement, other agreement or certificate
evidencing or securing the Loan or executed by Owner in
connection therewith.
"Loss Payee
Endorsement"- shall mean the loss payee endorsement
which constitutes part of the Residual Value
Policy.
"Loss
Proceeds" shall mean any Condemnation Proceeds or
Insurance Proceeds, as applicable.
"Make-Whole
Premium" shall mean the amount, if any, determined by
Lender in its reasonable discretion (at the time immediately
prior to the payment of such amount to Lender) which, when
added to the remaining principal of the Note or of the
Defeased Note, as applicable, will be sufficient to purchase
U.S. Obligations which provide payments that will meet the
Scheduled Defeasance Payments assuming a defeasance was to
occur on the date such Make-Whole Premium is due (whether or
not any defeasance is then required or permitted under this
Indenture), provided, however, that under no circumstances
shall the Make-Whole Premium be less than zero.
"Master
Lease" shall mean that certain Lease Agreement, of
even date herewith, by and between Owner, as landlord, and
Tenant, as tenant.
"Master Lease
Assignment" shall mean that certain first priority
Assignment of Master Lease and Guaranty, of even date
herewith, from Owner, as assignor, to Lender, as assignee,
assigning Owner's interest in and to the Leases, the Master
Lease Guaranty, the Property Income and in certain other
contracts including the Residual Value Policy as collateral
security for the repayment of the Indebtedness.
"Master Lease
Guarantor" shall mean ACCOR, a French societe anonyme,
together with its permitted successors and assigns by merger,
consolidation or acquisition of its assets substantially as
an entirety.
"Master Lease
Guaranty" shall mean that certain Lease Guaranty, of
even date herewith, made by Master Lease Guarantor for the
benefit of Owner.
"Material
Alteration" shall have the meaning provided in Section
2.3(c) hereof.
"Maturity
Date" shall mean the Maturity Date specified in the
Note which is May 1, 2018.
"Maximum
Rate" shall have the meaning provided in the
Note.
"Moody's"
shall mean Moody's Investors Service, Inc., or any successor
thereto.
"Mortgage
States" shall mean the States of Kentucky, Louisiana,
Michigan and Ohio.
"Mortgaged
Property" shall have the meaning provided in the
Granting Clauses hereto. "NACC" shall have the meaning
provided in Section 2.20(i) hereof.
"Net
Proceeds" shall mean the excess of (i) (x) the
purchase price (at foreclosure or otherwise) actually
received by Lender with respect to the Mortgaged Property as
a result of the exercise by Lender of its rights, powers,
privileges and other remedies after the occurrence of an
Event of Default, or (y) in the event that Lender (or
Lender's nominee) is the purchaser at foreclosure by credit
bid, then the amount of such credit bid, in either case, over
(ii) all costs and expenses, including, without limitation,
all reasonable attorneys' fees and disbursements and any
brokerage fees, if applicable, incurred by Lender in
connection with the exercise of such remedies, including the
sale of such Mortgaged Property after a foreclosure against
the Mortgaged Property.
"Note"
shall mean that certain Promissory Note evidencing the Loan
from Owner, as maker, to Lender, as lender, or order, as
payee, together with any extension, modification, amendment
or supplement thereto and any replacement or restatement
thereof.
"Notice Deposit
Amount" shall have the meaning provided in Section 4.6
hereof.
"Officer's
Certificate" shall mean a certificate delivered to
Lender by Owner which is signed by the Authorized
Representative of Owner.
"Operative
Document" shall mean each Loan Document, the Option
Agreement, the Tripartite Agreement, the Master Lease, the
Master Lease Guaranty, the Residual Value Policy and each
other instrument, contract, document, certificate or
agreement entered into by any of Seller, Owner, Remainderman,
Tenant, Master Lease Guarantor or Residual Value Insurer in
connection with the sale, acquisition, ownership, leasing,
franchising or management of the Mortgaged Property, the
guaranty of the Master Lease and Tenant Consent and the
insurance with respect to the residual value of the Mortgaged
Property.
"Option
Agreement" shall mean that certain Option and
Subordination Agreement, if any, between Owner and
Remainderman setting forth the option of Owner to ground
lease or purchase a particular Land Parcel from Remainderman
effective at the expiration of the Estate for
Years.
"Option
Notice" shall have the meaning provided in the Master
Lease.
"Option
Purchase Price" shall have the meaning provided in the
Master Lease.
"Owner"
shall mean M-Six Penvest II Business Trust, a Delaware
business trust, and each other Owner listed on Schedule I
hereto through which it directly or indirectly holds title to
the Landlord's Interest in the Properties, and their
respective permitted successors and assigns.
"Partners"
shall have the meaning provided in Section 4.3(z)
hereof.
"Payment"
shall have the meaning provided in Section 2.1(c)
hereof.
"Payment
Date" shall mean the date on which each of the Debt
Service Payments are due under the Note, which shall be
payable monthly commencing on the First Payment Date, or if
such day is not a Business Day, the next following Business
Day, and shall include the Maturity Date of the Note on which
the Balloon Payment is due provided,
however,
that the first payment of stub period interest only, if any,
due on the Note shall be paid on the Closing
Date.
"Permitted
Defeasance Date" shall mean any Payment Date occurring
after the earlier of two years after the start up date within
the meaning of Section 860G(a)(9) of the I.R.C. of any Person
or pool of assets electing REMIC status in a Secondary Market
Transaction which includes the Loan or thirty-six (36) months
after the Closing Date.
"Permitted
Encumbrances" shall mean collectively, (i) the Liens
created by this Indenture and the Master Lease Assignment,
(ii) the Master Lease and the Sublease, (iii) Liens and those
exceptions to title set forth in the Title Insurance Policy
obtained by Lender in connection with this Indenture, (iv)
Liens, if any, for Impositions imposed by any Governmental
Authority not yet due or delinquent or being contested in
good faith and by appropriate proceedings in accordance with
Section 2.6(b) hereof, (v) any mechanics, materialmen's or
other Liens deleted from the exceptions to, or for which
Lender is affirmatively insured against for loss or damage
pursuant to, the Title Insurance Policy issued to Lender
insuring the Lien of this Indenture, and (vi) without
limiting the foregoing, any and all governmental and public
utility easements, licenses or other similar agreements which
may hereafter be granted by Owner and Remainderman (to the
extent Owner has requested that Remainderman join therein)
and which do not adversely affect (A) the marketability of
title to the Mortgaged Property, (B) the fair market value
thereof, or (C) the use thereof as of the date hereof and
provided that Owner has complied with Section 2.11 with
respect thereto.
"Permitted
Investments": Any one or more of the following
obligations or securities payable on demand or having a
scheduled maturity on or before the Business Day preceding
the date upon which the funds in the related Cash Collateral
Account are required to be drawn:
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(i)
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obligations
of, or obligations fully guaranteed as to payment of principal and
interest by, the United States or any agency or instrumentality
thereof provided such obligations are backed by the full faith and
credit of the United States of America including, without
limitation, obligations of the U.S. Treasury (all direct or fully
guaranteed obligations), the Farmers Home Administration
(certificates of beneficial ownership), the General Services
Administration (participation certificates), the U.S. Maritime
Administration (guaranteed Title XI financing), the Small Business
Administration (guaranteed participation certificates and
guaranteed pool certificates), the U.S. Department of Housing and
Urban Development (local authority bonds), and the Washington
Metropolitan Area Transit Authority (guaranteed transit bonds);
provided, however, that the investment described in this clause
must (A) have a predetermined fixed dollar of principal due at
maturity that cannot vary or change, (B) if rated by S&P, must
not have an "r" highlighter affixed to their rating, (C) if such
investments have a variable rate of interest, such interest rate
must be tied to a single interest rate index plus a fixed spread
(if any) and must move proportionately with that index, and (D)
such investments must be not subject to liquidation prior to their
maturity;
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(ii) Federal
Housing Administration debentures;
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(iii)
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obligations
of the following United States government sponsored agencies:
Federal Home Loan Mortgage Corp. (debt obligations), the Farm
Credit System (consolidated systemwide bonds and notes), the
Federal Home Loan Banks (consolidated debt obligations), the
Federal National Mortgage Association (debt obligations), the
Student Loan Marketing Association (debt obligations), the
Financing Corp. (debt obligations), and the Resolution Funding
Corp. (debt obligations); provided, however, that the investments
described in this clause must (A) have a predetermined fixed dollar
of principal due at maturity that cannot vary or change, (B) if
rated by S&P, must not have an "r" highlighter affixed to their
rating, (C) if such investments have a variable rate of interest,
such interest rate must be tied to a single interest rate index
plus a fixed spread (if any) and must move proportionately with
that index, and (D) such investments must not be subject to
liquidation prior to their maturity;
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(iv)
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federal
funds, unsecured certificates of deposit, time deposits, bankers'
acceptances and repurchase agreements with maturities of not more
than 365 days of any bank, the short term obligations of which at
all times are rated in the highest short term rating category by
each Rating Agency (or, if not rated by any Rating Agency other
than S&P, otherwise acceptable to such Rating Agency or
Agencies, as applicable, as confirmed in writing that such
investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current ratings assigned to
the Securities); provided, however, that the investments described
in this clause must (A) have a predetermined fixed dollar of
principal due at maturity that cannot vary or change, (B) if rated
by S&P, must not have an "r" highlighter affixed to their
rating, (C) if such investments have a variable rate of interest,
such interest rate must be tied to a single interest rate index
plus a fixed spread (if any) and must move proportionately with
that index, (D) such investment must not be subject to liquidation
prior to their maturity;
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(v)
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fully
Federal Deposit Insurance Corporation-insured demand and time
deposits in, or certificates of deposit of, or bankers' acceptances
issued by, any bank or trust company, savings and loan association
or savings bank, the short term obligations of which at all times
are rated in the highest short term rating category by each Rating
Agency (or, if not rated by any Rating Agency other than S&P,
otherwise acceptable to such Rating Agency or Agencies, as
applicable, as confirmed in writing that such investment would not,
in and of itself, result in a downgrade, qualification or
withdrawal of the then current ratings assigned to the Securities);
provided, however, that the investments described in this clause
must (A) have a predetermined fixed dollar of principal due at
maturity that cannot vary or change, (B) if rated by S&P, must
not have an "r" highlighter affixed to their rating, (C) if such
investments have a variable rate of interest, such interest rate
must be tied to a single interest rate index plus a fixed spread
(if any) and must move proportionately with that index, and (D)
such investments must not be subject to liquidation prior to their
maturity;
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(vi)
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debt
obligations with maturities of not more than 365 days and at all
times rated by each Rating Agency (or, if not rated by any Rating
Agency other than S&P, otherwise acceptable to such Rating
Agency or Agencies, as applicable, as confirmed in writing that
such investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current ratings assigned to
the Securities) in its highest long-term unsecured rating category;
provided, however, that the investments described in this clause
must (A) have a predetermined fixed dollar of principal due at
maturity that cannot vary or change, (B) if rated by S&P, must
not have an "r" highlighter affixed to their rating, (C) if such
investments have a variable rate of interest, such interest rate
must be tied to a single interest rate index plus a fixed spread
(if any) and must move proportionately with that index, and (D)
such investments must not be subject to liquidation prior to their
maturity;
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(vii)
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commercial
paper (including both non-interest-bearing discount obligations and
interest-bearing obligations payable on demand or on a specified
date not more than one year after the date of issuance thereof)
with maturities of not more than 365 days and that at all times is
rated by each Rating Agency (or, if not rated by any Rating Agency
other than S&P, otherwise acceptable to such Rating Agency or
Agencies, as applicable, as confirmed in writing that such
investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current ratings assigned to
the Securities) in its highest short-term unsecured debt rating;
provided, however, that the investments described in this clause
must (A) have a predetermined fixed dollar of principal due at
maturity that cannot vary or change, (B) if rated by S&P, must
not have an "r" highlighter affixed to their rating, (C) if such
investments have a variable rate of interest, such interest rate
must be tied to a single interest rate index plus a fixed spread
(if any) and must move proportionately with that index, and (D)
such investments must not be subject to liquidation prior to their
maturity;
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(viii)
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the
Federal Prime Obligation Money Market Fund so long as such fund is
rated "AAA" by each Rating Agency (or, if not rated by any Rating
Agency other than S&P, otherwise acceptable to such Rating
Agency or Agencies, as applicable, as confirmed in writing that
such investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current ratings assigned to
the Securities); and
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(ix)
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any
other demand, money market or time deposit, demand obligation or
any other obligation, security or investment, provided that each
Rating Agency has confirmed in writing to the Lender, that such
investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current ratings assigned to
the Securities;
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provided,
however, (A) that, in the judgment of the Lender, such
obligation or security continues to qualify as a "cash flow
investment" pursuant to I.R.C. 860G(a)(6) earning a passive
return in the nature of interest and (B) that no obligation or
security shall be a Permitted Investment if (1) such
obligation or security evidences a right to receive only
interest payments or (2) the right to receive principal and
interest payments on such obligation or security are derived
from an underlying investment that provides a yield to
maturity in excess of 120% of the yield to maturity at par of
such underlying investment.
"Person"
shall mean any individual, corporation, partnership, limited
liability company, 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.
"Principal
Amount" shall mean the principal amount of the Loan
outstanding from time to time as the same may be increased as
a result of any advance by Lender under any Loan Document and
as the same may be decreased as a result of any payment or
prepayment thereof.
"Proceeds"
shall have the meaning provided in the Granting Clauses
hereto.
"Property"
shall have the meaning provided in the Granting Clauses
hereto.
"Property
Income" shall have the meaning provided in the
Granting Clauses hereto.
"Purchase
Option" shall have the meaning provided in the Master
Lease.
"Purchase
Option Closing Date" shall have the meaning provided
in the Master Lease.
"Rating
Agencies" shall mean Duff, Fitch, Moody's and S&P
and any other nationally recognized statistical rating agency
which may hereafter be engaged by Lender; provided,
however,
that at any time during which the Loan is included in a
Secondary Market Transaction, "Rating Agencies" shall mean
the rating agency or rating agencies that from time to time
rate the Securities issued in connection with such Secondary
Market Transaction.
"Recourse
Distributions" shall have the meaning provided in
Section 4.3(z) hereof.
"Rejectable
Offer" shall have the meaning provided in the Master
Lease.
"Rejectable
Substitution Offer" shall have the meaning provided in
the Master Lease.
"Released
Property" shall have the meaning provided in Section
2.8(a) hereof.
"Remainderman"
shall mean each Remainderman, if any, listed on Schedule I
hereto which holds title to the remainder interest in the
related Property, and their respective permitted successors
and assigns, and any Person acquiring a remainder interest in
the related Property pursuant to and in accordance with
Section 2.16 hereof.
"Remedial
Work" shall have the meaning provided in Section
2.22(a)(ii) hereof.
"REMIC,"
shall mean a real estate mortgage investment conduit as
defined under Section 860D of the I.R.C.
"Replaced
Project" shall have the meaning provided in Section
2.8(a) hereof.
"Residual Value
Insurer" shall mean R.V.I. America Insurance Company,
a Connecticut insurance company, together with any successor
thereto by merger, consolidation or sale of substantially all
of its assets.
"Residual Value
Policy" shall mean that certain residual value
insurance policy with respect to the Mortgaged Properties
issued by the Residual Value Insurer with Lender as loss
payee thereunder, together with all amendments, supplements
and endorsements thereto (including the Loss Payee
Endorsement).
"Restoration
Account" shall mean an Eligible Account in the name of
Lender, its successors and assigns, as secured party, or as
may be otherwise designated by Lender, into which all Loss
Proceeds, except as otherwise set forth in this Indenture,
shall be deposited.
"Room of the
90's Plans and Specifications" shall mean those plans
and specifications which have been delivered by Tenant to
Owner and to Lender, identified by Tenant as "Room of the
90's Plans and Specifications", and which have been
pre-approved by Owner and by Lender.
"S&P"
shall mean Standard & Poor's Ratings Group, or any
successor thereto.
"Scheduled
Defeasance Payments" shall have the meaning provided
in Section 2.20(d) hereof.
"Secondary
Market Transaction" shall mean any Securitization and
any other transaction in which the Lender (i) sells the Loan,
the Note and the other Loan Documents to one or more
investors as a whole loan, (ii) participates the Loan to one
or more investors, or (iii) otherwise sells the Loan or any
interest therein to investors.
"Securities"
shall mean any securities issued and outstanding or to be
issued pursuant to any Secondary Market
Transaction.
"Securitization"
shall mean any securitization in which the Loan is included
or is intended to be included.
"Seller"
shall mean Motel 6 Operating L.P., a Delaware limited
partnership, together with any entity succeeding thereto by
merger, consolidation or acquisition of its assets
substantially as an entirety.
"Single-Purpose
Entity" shall mean a corporation, limited partnership,
limited liability company or trust which, at all times since
its formation and thereafter until the Indebtedness shall
have been paid in full,
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(i)
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was
and will be organized solely for the purpose of (w) owning an
interest in the Mortgaged Property and owning the sole beneficial
interest in a trust which owns an interest in the Mortgaged
Property, and owning (1) the stock of the sole general partner of a
limited partnership which owns an interest in the Mortgaged
Property and (2) the sole limited partnership interest in such
limited partnership or (x) acting as the managing member of the
limited liability company which owns an interest in the Mortgaged
Property or which is the sole beneficial owner of the trust which
owns an interest in the Mortgaged Property or (y) acting as the
general partner of a limited partnership which owns an interest in
the Mortgaged Property or (z) acting as the sole beneficiary of a
trust which owns an interest in the Mortgaged
Property;
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(ii)
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has
not and will not engage in any business unrelated to (w) the
ownership and leasing of an interest in the Mortgaged Property, and
the ownership of the sole beneficial interest in a trust which owns
an interest in the Mortgaged Property, and the ownership of (1) the
stock of the sole general partner of a limited partnership which
owns an interest in the Mortgaged Property and (2) the sole limited
partner interest in such limited partnership, or (x) acting as a
managing member of a limited liability company which owns an
interest in the Mortgaged Property or which is the sole beneficial
owner of the trust which owns an interest in the Mortgaged Property
or (y) acting as a general partner of a limited partnership which
owns an interest in the Mortgaged Property or (z) acting as the
sole beneficiary of a trust which owns an interest in the Mortgaged
Property, and will conduct and operate its business as presently
conducted and operated;
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(iii)
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has
not and will not have any assets other than (w) those related to
the Mortgaged Property, and the ownership of the sole beneficial
interest in a trust which owns an interest in the Mortgaged
Property, and the ownership of (1) the stock of the sole general
partner of a limited partnership which owns an interest in the
Mortgaged Property and (2) the sole limited partner interest in
such limited partnership or (x) its member interest in the limited
liability company which owns an interest in the Mortgaged Property
or which is the sole beneficial owner of the trust which owns an
interest in the Mortgaged Property or (y) its general partnership
interest in the limited partnership which owns an interest in the
Mortgaged Property or (z) its beneficial interest in a trust which
owns an interest in the Mortgaged Property, as
applicable;
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(iv)
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will
do all things necessary to preserve its existence, has not and will
not engage in, seek or consent to any dissolution, winding up,
liquidation, consolidation or merger, (y) except as otherwise
expressly permitted by this Indenture, has not and will not engage
in, seek or consent to any asset sale, transfer of partnership,
membership, shareholder or beneficial interests, and (z) without
the prior written consent of Lender, will not amend, modify or
otherwise change its partnership agreement, articles of
incorporation, articles of organization, certificate of formation,
operating agreement, limited liability company agreement, trust
agreement or trust certificate (as applicable) and will not permit
a constituent party to cause the amendment or modification of such
constituent agreement of such Single Purpose Entity, or other
change thereto;
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(v)
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if
such entity is a limited partnership, has and will have as its only
general partners, general partners which are and will be
Single-Purpose Entities which are corporations;
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(vi)
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if
such entity is a trust, has and will have as its trustee, an
Independent Trustee, has not taken and will not take any action
requiring the consent of such Independent Trustee unless such
Independent Trustee has consented thereto, and, unless it is a
Delaware Business Trust, has and will have as its sole beneficial
owner, a beneficial owner which is a Single-Purpose
Entity;
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(vii)
if such entity is a corporation, at all relevant times, has and
will have at least one Independent Director;
(viii) he
board of directors of such entity has not taken and will not take
any action requiring the unanimous affirmative vote of 100% of the
members of the board of directors unless all of the directors,
including, without limitation, all Independent Directors, shall
have participated in such vote;
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(ix)
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has
not and will not fail to correct any known misunderstanding
regarding the separate identity of such entity;
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(x)
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if
such entity is a limited liability company, has and will have at
least one member that is and will be a Single-Purpose Entity which
is and will be a corporation, and such corporation is and will be
the managing member of such limited liability company;
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(xi)
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without
the unanimous consent of all of the partners, directors (including
without limitation all Independent Directors), members, beneficial
owners or trustees (including without limitation the Independent
Trustee), as applicable, has not and will not with respect to
itself or to any other entity in which it has a direct or indirect
legal or beneficial ownership interest (a) file a bankruptcy,
insolvency or reorganization petition or otherwise institute
insolvency proceedings or otherwise seek any relief under any laws
relating to the relief from debts or the protection of debtors
generally; (b) seek or consent to the appointment of a receiver,
liquidator, assignee, trustee, sequestrator, custodian or any
similar official for such entity or all or any portion of such
entity's properties; (c) make any assignment for the benefit of
such entity's creditors; or (d) take any action that might cause
such entity to become insolvent;
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(xii)
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has
maintained and will maintain its accounts, books and records
separate from any other Person;
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(xiii)
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has
maintained and will maintain its books, records, resolutions and
agreements as official records;
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(xiv)
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has
not commingled and will not commingle its funds or assets with
those of any other Person;
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(xv)
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has
held and will hold its assets in its own name and has maintained
and will maintain its assets in such a manner that it will not be
costly or difficult to segregate, ascertain or identify its
individual assets from those of any Affiliate or constituent party
or any other Person;
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(xvi) has
conducted and will conduct its business in its name;
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(xvii)
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has
maintained and will maintain its books, records, financial
statements, accounting records, bank accounts and other entity
documents separate from any other person or entity, and will file
its own tax returns;
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(xviii) has
paid and will pay its own liabilities out of its own funds and
assets;
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(xix)
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has
observed and will observe all partnership, corporate, limited
liability company or trust formalities as applicable;
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(xx) has
maintained and will maintain an arms-length relationship with its
Affiliates;
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(xxi)
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(a)
if such entity owns an interest in the Mortgaged Property, has and
will have no indebtedness, secured or unsecured, direct or
indirect, absolute or contingent (including guaranteeing any
obligation), other than the Indebtedness and unsecured trade
payables in the ordinary course of business relating to the
ownership and operation of the Mortgaged Property which are paid
within thirty (30) days of the date incurred, or (b) if such entity
acts as the general partner of a limited partnership which owns an
interest in the Mortgaged Property, has and will have no
indebtedness, secured or unsecured, direct or indirect, absolute or
contingent (including guaranteeing any obligation), other than
unsecured trade payables in the ordinary course of business
relating to acting as a general partner of such limited partnership
which are paid within thirty (30) days of the date incurred, (c) if
such entity acts as a managing member of a limited liability
company which is the beneficial owner of a trust which owns an
interest in the Mortgaged Property, has and will have no
indebtedness, secured or unsecured, direct or indirect, absolute or
contingent (including guaranteeing any obligation), other than
unsecured trade payables in the ordinary course of business
relating to acting as a member of such limited liability company
which are paid within thirty (30) days of the date incurred, or (d)
if such entity is a beneficial owner of a trust which owns an
interest in the Mortgaged Property and such beneficial owner is
required to be a Single Purpose Entity pursuant to the provisions
of this Indenture, has and will have no indebtedness, secured or
unsecured, direct or indirect, absolute or contingent (including
guaranteeing any obligation), other than [Pool IV and IX only: the
Indebtedness and] unsecured trade payables in the ordinary course
of business relating to acting as a beneficial owner of such trust
which are paid within thirty (30) days of the date
incurred;
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(xxii)
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has
not and will not assume or guaranty or become obligated for the
debts of any other Person and has not and will not hold itself out
to be responsible for the debts or obligations of any other
Person;
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(xxiii)
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has
not acquired and will not acquire obligations or securities of its
partners, members, beneficial owners, trustees, shareholders or
other Affiliates;
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(xxiv)
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is
and will remain solvent, will pay its debts and liabilities as they
become due and has allocated and will allocate fairly and
reasonably shared expenses, including, without limitation, shared
office space;
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(xxv)
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except
pursuant hereto, has not and will not pledge its assets for the
benefit of any other Person;
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(xxvi)
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has
held and identified itself and will hold itself out and identify
itself as a separate and distinct entity under its own name and not
as a division or part of any other Person and will maintain and
utilize separate stationary, invoices and checks;
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(xxvii)
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has
not made and will not make loans or advances to any Person
(excluding advances which Owner is permitted to make as landlord
under the Master Lease);
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(xxviii)
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has
not and will not identify its partners, members, beneficial owners,
trustees or shareholders, or any Affiliates of any of them as a
division or part of it;
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(xxix)
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if
such entity is a limited liability company, such entity shall
dissolve only upon the bankruptcy of the managing member, and such
entity's articles of organization, certificate of formation,
limited liability company agreement and/or operating agreement, as
applicable, shall contain such provision;
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(xxx)
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has
not entered and will not enter into or be a party to, any
transaction, contract or agreement with its partners, members,
beneficial owners, trustees, shareholders or its Affiliates except
in the ordinary course of its business and on terms which are
intrinsically fair and are no less favorable to it than would be
obtained in a comparable arms-length transaction with an unrelated
third party;
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(xxxi) has
paid and will pay the salaries of its own employees from its own
funds;
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(xxxii)
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has
maintained and will maintain adequate capital for the normal
obligations reasonably foreseeable in its contemplated business and
in light of its contemplated business operations; and
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(xxxiii)
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if
such entity is a limited liability company, limited partnership or
trust, and such entity has one or more managing members, general
partners or trustees, as applicable, then such entity shall
continue (and not dissolve) for so long as a solvent managing
member, general partner or trustee, as applicable, exists and such
entity's organizational documents shall contain such
provision.
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"SPE Equity
Owner" shall mean, (i) with respect to any Person that
is a partnership, the general partner of such partnership,
(ii) with respect to any Person that is a trust, the
beneficial owner(s) of such trust, unless such trust is a
Delaware Business Trust, and (iii) with respect to any Person
that is a limited liability company, the managing member
thereof.
"SPE Equity
Owner's Certificate" means the SPE Equity Owner's
Certificate in form and substance satisfactory to Lender
dated as of the Closing Date.
"State"
shall mean the state or commonwealth in which the related
Mortgaged Property is situated.
"Stipulated
Loss Value" shall have the meaning provided in the
Master Lease.
"Structural
Work" shall have the meaning provided in Section
2.3(c) hereof.
"Sublease"
shall mean that certain Sublease Agreement of even date
herewith between Tenant, as landlord, and Seller, as
tenant.
"Substitute
Project" shall have the meaning provided in the Master
Lease.
"Substitution"
shall have the meaning provided in the Master
Lease.
"Successor
Borrower" shall have the meaning provided in Section
2.20(i) hereof.
"Taking"
shall mean a taking, requisition, sale or voluntary
conveyance of all or part of the Mortgaged Property, or any
interest therein or right accruing thereto or use or
occupancy thereof, by, on account of, or in settlement of any
actual or threatened condemnation or other eminent domain
proceeding whether or not the same shall have actually been
commenced.
"Tenant"
shall mean Universal Commercial Credit Leasing III, Inc., a
Delaware corporation, as tenant under the Master Lease,
together with any entity succeeding thereto by merger,
consolidation or acquisition of its assets substantially as
an entirety as permitted under the Master Lease.
"Tenant
Consent" shall mean that certain Assignment of Master
Lease and Guaranty Consent Agreement, of even date herewith,
among Owner, Tenant and Lender.
"Tenant's
Personal Property" shall include Tenant's or any
sublessee's tradenames or trademarks or the right to use the
same, Tenant's or any sublessee's reservation system,
Tenant's or any sublessee's proprietary computer software,
Tenant's or any sublessee's telephone system and wiring and,
in addition, Tenant's Personal Property and personal property
located on or about the Land and Improvements which is owned
or held under lease by Tenant from persons other than Owner
that is not subject to the Master Lease.
"Termination
Date" shall have the meaning provided for "Lease
Termination Date" in the Master Lease.
"Title
Insurance Policy" shall mean the ALTA Form 1992
lender's title insurance policy, insuring that this Indenture
constitutes a first priority lien in favor of Lender on the
Mortgaged Property subject only to the Permitted Encumbrances
of the type specified in clause (i), (ii) and (iii) (other
than the Master Lease Assignment and the Sublease) of the
definition thereof, and containing such endorsements and
affirmative assurances as Lender shall reasonably
require.
"Transfer"
shall mean the conveyance, assignment, sale, mortgaging,
encumbrance, pledging, hypothecation, granting of a security
interest in, 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 direct or indirect, legal or beneficial interest
(including any profit interest in Owner or any SPE Equity
Owner) in all or any portion of the Mortgaged Property or in
Owner or any SPE Equity Owner.
"Transferee"
shall have the meaning provided in Section 2.16(a)
hereof.
"Tripartite
Agreement" shall mean that certain Tripartite
Agreement, if any, among Tenant, Owner and
Remainderman.
"Trustee"
shall mean, in the event that this Indenture is a deed of
trust, the Person appointed to act as trustee
hereunder.
"Work"
shall have the meaning provided in Section 2.3(c)
hereof.
"U.S.
Obligations" means obligations or securities not
subject to prepayment, call or early redemption which are
direct obligations of, or obligations fully guaranteed as to
timely payment by, the United States of America or any agency
or instrumentality of the United States of America, the
obligations of which are backed by the full faith and credit
of the United States of America.
"Undefeased
Note" shall have the meaning provided in Section
2.20(a) hereof.
"Unscheduled
Payments" shall mean (i) all Loss Proceeds that Lender
has elected or is required to apply to the repayment of the
Indebtedness pursuant to this Indenture, the Loan Agreement
or any other Loan Document, (ii) any funds representing a
voluntary or involuntary prepayment of the principal portion
of the Note and (iii) any Net Proceeds.
ARTICLE
2
Covenants
Each of Owner and
Remainderman covenants, warrants, represents and agrees with
and to Lender as follows (each representing and agreeing only
with respect to itself):
Section
2.1
Payment of the
Indebtedness. Owner shall punctually pay the
Indebtedness at the times and in the manner provided in this
Indenture, in the Note and in the other Loan Documents, all
in lawful money of the United States of America, without
setoff, counterclaim or any other deduction
whatsoever.
(a) Owner's
obligation to pay the principal of and interest on the Loan
(including Late Charges, Default Rate Interest, and
Make-Whole Premium, if any), shall be evidenced by this
Indenture and by the Note, duly executed and delivered by
Owner. The Note shall be payable as to principal, interest,
Late Charges, Default Rate Interest and Make-Whole Premium,
if any, as specified in this Indenture and in the Note, with
a final maturity on the Maturity Date. Owner shall pay all
outstanding Indebtedness on the Maturity Date. Interest
(other than Default Rate Interest) shall accrue on the
outstanding Principal Amount of the Note and all other
amounts due to Lender under the Loan Documents at the Fixed
Rate and shall be computed as set forth in the Note. If Owner
fails to make any payment of principal, interest, Make-Whole
Premium or Defeasance Deposit, whether as a Debt Service
Payment, at maturity, as part of any prepayment, defeasance,
upon acceleration or otherwise, as set forth in the Loan
Documents within two (2) Business Days after the delivery of
written notice to Owner and to Tenant that such amount and
any payment then due under the Master Lease has not been paid
when the same is due, Owner shall pay a Late Charge provided,
however, that such Late Charge shall not be due until thirty
(30) days after failure to pay the Balloon Payment on the
Maturity Date. On the Maturity Date, Owner shall pay to
Lender all amounts owing under the Loan Documents including,
without limitation, interest, principal, Late Charges,
Default Rate Interest and any Make-Whole Premium. The Note is
subject to prepayment as set forth in Section 2.9 and is
subject to defeasance as set forth in Section
2.20.
(b) On
each Payment Date until the Note is paid in full on the
Maturity Date or otherwise, Owner shall pay to Lender an
amount equal to the Debt Service Payment due on the related
Payment Date as set forth on Schedule 1 attached to the Note,
irrespective of whether or not any voluntary or involuntary
prepayments of principal have been made, provided,
however,
that such Debt Service Payments may be reamortized as set
forth in this Section 2.1(b). On the Maturity Date, Owner
shall pay to Lender, without duplication, the Balloon
Payment, if any, and the entire outstanding Principal Amount
of the Note, to the extent not theretofore paid, together
with all accrued but unpaid interest thereon and any other
Indebtedness due hereunder, under the Note or under any other
Loan Document. In the event that Lender elects, agrees or is
obligated to accept a prepayment of a portion of the Note in
accordance with this Indenture, each Debt Service Payment
which shall thereafter be payable with respect to the Note
shall be reduced by an amount equal to the product of such
Debt Service Payment times a fraction, the numerator of which
equals the principal amount being prepaid and the denominator
of which equals the entire principal amount outstanding
hereunder at the time of determination prior to giving effect
of such prepayment, such that upon the due payment of all
remaining Debt Service Payments, there shall have been paid
to Lender the entire unpaid principal amount of the Note
together with accrued interest thereon on a stepped
installment payment basis. Schedule 1 shall be revised by
Owner to so reamortize the remaining Debt Service Payments
and a new Schedule 1 shall be delivered to Lender to be
substituted for the Schedule 1 then attached to the Note.
Such revised Schedule 1 shall reflect payments on the same
Payment Dates set forth in the original Schedule 1 and at the
same interest rate utilized in the original Schedule 1 over
the remaining life of the Note and, absent error, the Debt
Service Payments thereafter due on the Note shall be those
set forth in such revised Schedule 1. If any such partial
prepayment occurs on any date other than a Payment Date,
Schedule I shall be adjusted or annotated as appropriate as
it relates to interest with respect to the next succeeding
Payment Date.
(c) Each
and every payment including each Debt Service Payment (each,
a "Payment";
collectively, the "Payments")
made by Owner to Lender in accordance with the terms of this
Indenture, the Note and/or the terms of any one or more of
the other Loan Documents and all other proceeds received by
Lender with respect to the Indebtedness, shall be applied (i)
first, to all Late Charges, Make-Whole Premium, Default Rate
Interest and other sums payable as Indebtedness hereunder,
under the Note or under the other Loan Documents (other than
those sums included in clauses (ii) and (iii) of this Section
2.1(c), but including any amounts advanced by Lender on
behalf of Owner) in such order and priority as determined by
Lender in its sole discretion, (ii) second, to all other
interest which shall be due and payable with respect to the
Principal Amount pursuant to the terms of the Note as of the
date the Payment is received, and (iii) third, to the
Principal Amount, provided,
however,
that (x) amounts received under Article 4 shall be applied as
set forth in Section 4.3(l) and (y) any amounts received with
respect to a defeasance pursuant to Section 2.20 shall be
applied in accordance with Section 2.20. Unscheduled Payments
shall be applied in the same manner set forth herein subject,
however, to the applicable provisions of this Indenture with
respect thereto.
(d) To
the extent that Owner makes a Payment or Lender receives any
Payment or proceeds for Owner's benefit, which are
subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be repaid to a
trustee, debtor in possession, receiver, custodian or any
other party under any bankruptcy law, common law or equitable
cause, then, to such extent, the obligations of Owner
intended to be satisfied thereby shall be revived and
continue as if such Payment or proceeds had not been received
by Lender.
(e) If
a Default in the payment of money owed by Owner to Lender
shall occur hereunder, under the Note or under any other Loan
Document, interest on the defaulted amount commencing on the
date of the occurrence of such Default, immediately and
without notice to Owner, shall accrue at the Default Rate
until such defaulted amount is paid to Lender with interest
thereon at the Default Rate.
(f) In
the event the Indebtedness is accelerated pursuant to this
Indenture, or in the event that Owner shall prepay all or
from time to time any portion of the Principal Amount in
connection with the release of all or a portion of the
Mortgaged Property relating to a Rejectable Offer or a
Purchase Option or a FMV Purchase Option made by Tenant
pursuant to the Master Lease which requires the payment of a
Make-Whole Premium thereunder, Owner shall be required to pay
to Lender, in addition to the Principal Amount which has been
accelerated or which is to be prepaid and accrued interest
and any other Indebtedness which is then due and payable, an
amount equal to the Make-Whole Premium. Lender shall deliver
telephonic notice to Owner and Tenant no later than 11 A.M.
East Coast Time (such notice to be confirmed in writing by
Lender on the same day by facsimile) of the amount of any
such Make-Whole Premium then due, which notice shall be
conclusive and binding absent manifest error, provided,
however,
that any failure of Lender to deliver such notice shall not
excuse or delay Owner's obligation to pay such Make-Whole
Premium when due.
(g) The
provisions of this Section 2.1 shall survive any discharge of
the Lien of this Indenture in connection with a defeasance
pursuant to Section 2.20.
Section
2.2
Title to the
Mortgaged Property.
(a) Owner
is the owner of either (i) good, marketable and insurable fee
simple title to the Mortgaged Property or (ii) good,
marketable, and insurable fee simple title to the Estate for
Years and to the Mortgaged Property (other than the Land), as
specified on Schedule I hereto, including in either case all
buildings on the Mortgaged Property and all installations and
mechanical, electrical, plumbing, heating and air
conditioning systems located in or annexed to such buildings,
and all additions, alterations and replacements made at any
time with respect to the foregoing, free and clear of liens
and encumbrances except Permitted Encumbrances (other than
the Master Lease Assignment and the Sublease which are to be
recorded subsequent to this Indenture). Remainderman, if any,
is the owner of good, marketable and insurable fee simple
title to the remainder interest in the Land free and clear of
liens and encumbrances except Permitted Encumbrances (other
than the Master Lease Assignment and the Sublease which are
to be recorded subsequent to this Indenture). Except as set
forth in the Master Lease and the Option Agreement, if any,
there are no outstanding options or rights of first refusal
affecting the Mortgaged Property or any portion
thereof.
(b) Each of Owner and
Remainderman has full power, authority and right to execute,
deliver and perform its obligations under this Indenture and
to encumber, mortgage, give, grant, bargain, sell, alienate,
enfeoff, convey, confirm, pledge, assign and hypothecate the
Mortgaged Property in the manner and form herein set
forth.
(c) This
Indenture is and will remain a valid and enforceable first
lien on and security interest in the Mortgaged Property,
subject only to the Permitted Encumbrances (other than the
Master Lease Assignment and the Sublease which are to be
recorded subsequent to this Indenture). For purposes of this
Section 2.2 and Section 3.3, Lender acknowledges that certain
UCC -1 Financing Statements may have been filed against
Seller which transferred the FF&E to Owner. Owner agrees
to cause to be delivered to Lender confirmation (in form
reasonably acceptable to Lender) that any and all UCC-1
Financing Statements which affect or could affect the
FF&E have been released no later than November 1,
1998.
(d) Each
of Owner and Remainderman will preserve such title and will
forever warrant and defend the same and the validity and
priority of the Lien hereof to Trustee, for the benefit of
Lender, and Lender, against all claims
whatsoever.
(e) Owner
shall pay when due and payable, or if the Master Lease is
then in effect, cause Tenant to pay in accordance with the
terms of such Master Lease, all payments and charges due
under or in connection with any Liens and encumbrances on,
and security interest in and to, the Mortgaged Property or
any portion thereof, all rents and charges under any ground
leases affecting the Mortgaged Property, and all claims and
demands of mechanics, materialmen, laborers and others which,
if unpaid, might result in or permit the creation of a Lien
on the Mortgaged Property or any portion thereof which does
not constitute a Permitted Encumbrance. Without limiting
Owner's obligations pursuant to Section 2.29(a) hereof, Owner
shall within thirty (30) days (or such longer period as may
be set forth in the Master Lease) after the imposition of any
Lien (other than Permitted Encumbrances) on the Mortgaged
Property cause the full and unconditional discharge of such
Lien imposed on or against the Mortgaged Property or any
portion thereof by either payment in full thereof or filing
any bond required by law to effect such discharge.. Each of
Owner and Remainderman shall do or cause to be done, at the
sole cost of Owner, everything necessary to fully preserve
the first priority of the Lien of this Indenture on the
Mortgaged Property, subject only to Permitted Encumbrances.
If Owner fails to make any such payment or if a Lien attaches
to the Mortgaged Property or any portion thereof and the same
is not discharged within such thirty (30) day period (or such
longer period as may be allowed under the Master Lease),
Lender may (but shall not be obligated to) make such payment
or discharge such Lien, and Owner shall reimburse Lender on
demand for all such Advances, together with interest thereon
at the Default Rate from the date paid by Lender to the date
of repayment, and such sum shall be part of the Indebtedness
secured by this Indenture, but this sentence shall not
prevent any default by Owner in the observance of this
Section or of Section 2.29(a) from becoming an Event of
Default.
(f) Each
of Owner and Remainderman shall do, execute, acknowledge and
deliver, at Owner's sole cost and expense, such further acts,
instruments or documentation, including additional title
insurance policies or endorsements, as Lender may reasonably
require from time to time to better assure, transfer and
confirm unto Lender the rights now or hereafter intended to
be granted to Lender under this Indenture or any other Loan
Document; provided,
however,
that no such further acts, instruments or documentation shall
materially increase Owner's or Remainderman's respective
obligations under the Loan Documents or materially eliminate
or reduce Owner's or Remainderman's rights under the Loan
Documents.
(g) Owner shall pay any and
all taxes, charges, filing, registration and recording fees,
excises and levies imposed upon Lender in connection with the
execution, delivery and/or recording of this Indenture or any
other Loan Document or by reason of its interest in, or
measured by amounts payable under, the Note, this Indenture
or any other Loan Document (other than income, franchise and
doing business taxes), and shall pay all stamp taxes and
other taxes required to be paid on the Note or the other Loan
Documents. If Owner fails to make such payment within five
(5) days after notice thereof from Lender, Lender may (but
shall not be obligated to) pay the amount due, and Owner
shall reimburse Lender on demand for all such Advances with
interest thereon at the Default Rate from the date paid by
Lender to the date of repayment, and such sum shall be part
of the Indebtedness secured by this Indenture, but this
sentence shall not prevent any default by Owner in the
observance of this Section from becoming an Event of
Default.
(h) Owner
will, upon the execution and delivery hereof, and thereafter
from time to time, cause this Indenture, the Master Lease,
(or memoranda thereof), the Master Lease Assignment, each
supplement and amendment to each of said instruments and
Financing Statements with respect thereto, to be filed,
registered and recorded as may be required by law to publish
notice of and maintain the Lien hereof upon the Mortgaged
Property and to publish notice of and protect the validity of
the Master Lease, and the Master Lease Assignment. Owner
will, from time to time, perform or cause to be performed any
other act as required by law, and will execute or cause to be
executed any and all further instruments (including Financing
Statements, continuation statements and similar statements
with respect to any of said documents) requested by Lender
for such purposes. If Owner shall fail to execute, deliver
and file such financing statements and other instruments in
accordance with the provisions of this Section, Lender shall
be and is hereby irrevocably appointed the agent and
attorney-in-fact of Owner to do so, with full power of
substitution, which appointment is coupled with an interest,
but this sentence shall not prevent any default by Owner in
the observance of this Section from becoming an Event of
Default.
Section 2.3 Maintenance of
Mortgaged Property: Compliance with Legal Requirements:
Inspection: Alterations.
(a) Owner
shall for so long as the Master Lease is in effect,
diligently enforce the terms and provisions of the Master
Lease and take such action as shall be necessary to cause
Tenant thereunder to maintain the Mortgaged Property in
accordance with the terms of the Master Lease, and during any
other period while this Indenture is in effect, maintain or
cause the then tenant to maintain the Mortgaged Property in
good condition, working order and repair, provided,
however,
that Owner need not comply with the provisions of this clause
(ii) with respect to a particular Mortgaged Property during
such time as Tenant has elected to make a Rejectable Offer
pursuant to the Master Lease, is in compliance with the
provisions thereof and no Lease Event of Default shall have
occurred and be continuing. Subject to Tenant's right to
contest pursuant to and in accordance with Section 2.6 of the
Master Lease, Owner shall comply or cause Tenant (in
accordance with the Master Lease) or any future tenant of the
Mortgaged Property to comply in all material respects with
all Legal Requirements with respect to the Mortgaged
Property, and to comply in all material respects with the
requirements of any Governmental Authority claiming
jurisdiction over the Mortgaged Property or any portion
thereof within thirty (30) days (or such other period of time
provided in the order or allowed by law) after an order
containing such requirement has been issued by such
Governmental Authority. Owner shall promptly notify Tenant in
writing whenever Owner is required to enter into any
contract, agreement, covenant, condition, or restriction by
any governmental or quasi-governmental entity. Subject to the
terms of the Master Lease and applicable Legal Requirements,
Owner shall permit Lender or its authorized representatives
to enter upon and inspect the Mortgaged Property upon
reasonable prior notice at all reasonable hours. So long as
an Event of Default shall have occurred and be continuing,
the cost of such inspections shall be borne by Owner
including the cost of all follow up or additional
investigations or inquiries deemed reasonably necessary by
Lender. The cost of such inspections required to be borne by
Owner pursuant to the preceding sentence, if not paid for by
Owner following demand, may be added to the Indebtedness and
shall bear interest until paid at the Default
Rate.
(b) Owner
shall not, without the prior written consent of Lender, which
consent shall not be unreasonably withheld, unless an Event
of Default has occurred and be continuing, in which case
Lender may withhold its approval in its sole discretion, (i)
change the use of a Property or cause or permit the use or
occupancy of any part of a Property to be discontinued if
such change or discontinuance would violate any zoning or
other law, ordinance or regulation; (ii) initiate, join in,
acquiesce in, or consent to any private restrictive covenant,
zoning reclassification, or other public or private
modification or restriction adversely affecting all or any
portion of a Property or limiting or defining the uses which
may be made of a Property or any portion thereof; (iii)
permit or undertake any Material Alteration (except pursuant
to Sections 2.3(c) and 2.4(f) hereof) of the Mortgaged
Property or any portion thereof (provided that articles of
personal property included within the Collateral may be
removed, so long as the same are replaced with similar
Collateral of equal or greater value); (iv) permit or suffer
to occur any waste on or to the Mortgaged Property or any
portion thereof; or (v) take any steps whatsoever to convert
the Mortgaged Property or any portion thereof to a
condominium or cooperative form of ownership.
(c) Owner
or Tenant may, at its expense, make additions to and
alterations of the Improvements, and construct additional
Improvements (collectively, "Alterations"),
provided
that (i) the fair market value, utility and useful life of
the Mortgaged Property shall not be lessened in any material
respect thereby, (ii) such Alterations, if made by Tenant
shall be in compliance with the applicable provisions of the
Master Lease and, in any event, if made by Owner or Tenant
shall be expeditiously completed in a good and workmanlike
manner, free and clear of liens and encumbrances, and in
compliance with all applicable Legal Requirements and the
requirements of all insurance policies required to be
maintained by Owner or Tenant hereunder, (iii) Owner or
Tenant shall not make any Alterations in violation of the
terms of any restriction, easement, condition, covenant or
other matter affecting title to or use of the Mortgaged
Property and (iv) no Material Alterations, as hereafter
defined, shall be made unless Lender's prior written consent
shall have been obtained, which consent shall not be
unreasonably withheld, delayed or conditioned, provided no
Event of Default shall have occurred and be continuing.
"Material
Alteration" is defined as either (A) Structural Work
(as hereinafter defined), or (B) any demolition of any
material portion of the Improvements, or (C) Alterations
which would materially and adversely affect the building
systems or equipment, or (D) Work which involves the
construction of a shared common or party wall on a property
line which separates such Mortgaged Property from adjacent
land, or (E) Work for which the Estimated Cost is in excess
of $500,000.00 for any particular Mortgaged Property or which
would cause Work then being conducted for all Mortgaged
Properties to exceed $1,000,000.00, excluding, for purposes
of this clause (c) only, work consisting of renovations
effected pursuant to Room of the 90's Plans and
Specifications previously delivered to Lender and such other
Work effected pursuant to standard renovation plans that have
previously been approved by Lender (it being understood that
any request for such approval shall not be considered unless
Lender has received detailed plans and specifications, and
other information with respect to the proposed renovations as
may be reasonably requested). "Structural
Work" is defined as Work which involves in any
material respect any roof, load-bearing wall, structural
beams, columns, supports, foundation or any other structural
element of the Mortgaged Property. "Estimated
Cost" is defined as the estimated cost of materials,
construction and labor (not including architects, engineers
or other professionals), as estimated by a licensed Architect
(or if not required to be estimated by an Architect, as
reasonably estimated by Tenant), which estimate together with
a complete description of the Work and all related works
shall be delivered to, and such estimate and description
reasonably approved by, Lender before the commencement of any
Work hereunder. "Work"
is defined, without duplication, as Alterations, Material
Alterations, Structural Work, restoration, repair and any
other work which Owner or Tenant shall be required or
permitted to do under this Indenture or under the Master
Lease. Owner agrees that all Work shall be performed in each
case subject to compliance by Tenant with each of the
applicable provisions of the Master Lease and, without
duplication, subject to each of the following:
(i) Neither
Owner nor Tenant shall perform any Work which shall have a
material adverse effect on the use or operation of the
Mortgaged Property, as operated by Tenant as of the date
hereof (except such adverse effect as shall occur during the
period of time needed to complete the Work). Any Work when
completed shall be of such a character as not to materially
reduce the value of the Mortgaged Property below its value
immediately prior to the commencement of such Work or damage
to such Mortgaged Property necessitating such Work or
change.
(ii) No
Work shall be performed if the same would materially reduce
the usable square footage of the Improvements, or would
materially weaken, temporarily (other than during
construction or repair of the structure) or permanently, the
structure of the Improvements or any part thereof, or reduce
the permitted uses thereof under applicable zoning or
licensing laws or impair other amenities of the Mortgaged
Property.
(iii) No
Material Alterations shall be commenced until detailed plans
and specifications (including layout, architectural,
mechanical and structural drawings), prepared by an Architect
shall have been submitted to and approved by Lender, which
approval shall not be unreasonably withheld or delayed, and
no such Work shall be undertaken except under the supervision
of the Architect. Lender shall be deemed to have approved
plans and specifications which are materially consistent with
Room of the 90's Plans and
Specifications.
(iv) The reasonable cost
and expense paid to third parties (including any servicer of
Lender) of Lender's (A) review of any plans and
specifications required to be furnished pursuant to this
Indenture, or (B) review/supervision of any such Work shall
be paid by Owner or by Tenant within fifteen (15) days after
demand.
(v) All
Work shall be commenced only after all required municipal and
other governmental permits, licenses, authorizations and
approvals shall have been obtained by Owner or
Tenant.
(vi) If
the Work shall constitute a Material Alteration, it shall not
be commenced until Owner or Tenant shall have obtained and
delivered to Lender, either (A) a performance bond and a
labor and materials payment bond (issued by a corporate
surety licensed to do business in the state in which the
Mortgaged Property is located and reasonably satisfactory to
Lender), each in an amount equal to the Estimated Cost of
such Work and in form otherwise reasonably satisfactory to
Lender, or (B) such other security as shall be reasonably
satisfactory to Lender; provided, however, that if at the
time the Work is commenced, either Tenant or Master Lease
Guarantor then maintains and continues to maintain until such
Work is completed an Investment Grade Rating and no Event of
Default shall have occurred and be continuing and the
Estimated Cost of the Work does not exceed $1,500,000 as to
that Property (as adjusted for changes in the consumer price
index), neither Owner nor Tenant shall be required to comply
with this subsection (vi).
(vii) All
Work shall be performed in a good and workmanlike manner, and
in accordance with all Legal Requirements, as well as any
plans and specifications therefor which shall have been
approved by Lender, if required. All Work shall be commenced
and completed in a commercially reasonable
manner.
(viii) Subject
to the terms of Section 2.6 of the Master Lease with respect
to contesting certain charges, the cost of all Work shall be
paid promptly, in cash, so that the Mortgaged Property shall
at all times be free from (A) liens for labor or materials
supplied or claimed to have been supplied to the Mortgaged
Property (if the laws of a particular jurisdiction impose a
lien in favor of mechanics as of the commencement of Work or
disallow the prohibition of such lien, such lien in and of
itself shall not constitute a violation hereof, but such law
shall not relieve Owner of its obligation to timely pay all
charges incurred for Work), Tenant or Owner and (B) chattel
mortgages, conditional sales contracts, title retention
agreements, security interest and agreements, and financing
agreements and statements.
(ix) Upon
completion of any Work, Tenant or Owner, at its expense,
shall obtain certificates of final approval of such Work
required by any governmental or quasi-governmental authority
and shall furnish Lender with copies thereof, and, if the
Work constituted Material Alterations, together with
"as-built" plans and specifications for such
Work.
(x) Any
Work shall be subject to inspection at any time and from time
to time by Lender, and its architect(s), or duly authorized
construction representatives, and if any such party upon any
such inspection shall be of the reasonable opinion that the
Work is not being performed in accordance with the provisions
of this Section or the plans and specifications, or that any
of the materials or workmanship are unsound or improper,
Owner shall correct or cause to be corrected any such failure
and shall replace or cause to be replace any unsound or
improper materials or workmanship.
Section
2.4
Insurance;
Restoration.
(a) Owner
shall, at its expense, maintain, or cause Tenant or any other
tenant of the Mortgaged Property to maintain, the following
insurance coverages with respect to each Mortgaged Property
(except as otherwise set forth in clause (ii)) during the
term of this Indenture:
(i) Insurance
with respect to the Improvements against all perils included
within the classification "All Risk of Physical Loss",
covering such risks as shall be customarily insured against
with respect to improvements similar in construction,
location and use including by way of example, earthquake,
flood, sprinkler leakage, debris removal, cost of demolition,
malicious mischief, water damage, boiler and machinery
explosion or damage and the like, with extended coverage, and
in amounts not less than the greater of (x) 100% of the
actual replacement cost of the Improvements (exclusive of
foundations and excavations), without regard to depreciation,
and (y) such other amount as is necessary to prevent any
reduction in such policy by reason of and to prevent Owner,
Lender or any other insured thereunder from being deemed to
be a co-insurer. If as of the date hereof, or at any time
during the term of this Indenture, the Mortgaged Property is
not in compliance with all Legal Requirements such that in
the event of a partial or total casualty or destruction such
Legal Requirements would prohibit Owner or Tenant from
restoring or rebuilding the Mortgaged Property to the
specifications and condition of the Mortgaged Property prior
to such casualty or destruction, then Owner or Tenant shall
be required to carry agreed value insurance.
(ii) Commercial
general public liability insurance insuring, so long as the
Master Lease exists, Tenant, with Owner and Lender as
additional insureds, and otherwise insuring Owner, with
Lender as an additional insured, against all claims for
damages to person or property or for loss of life or of
property occurring upon, in, or about the Mortgaged Property,
with coverage for blanket contractual, personal injury,
bodily injury and property damage of not less than
$50,000,000 combined single limit coverage per occurrence and
in the aggregate in any given policy year, or such greater
limits as may be required from time to time by Lender
consistent with insurance coverage on properties similarly
constructed, occupied and maintained in the limited service
budget sector. In the event that the aggregate of (i) claims
paid pursuant to such policy of commercial general public
liability insurance in any policy year and (ii) final,
non-appealable judgments payable by the insurer pursuant to
such policy of commercial general public liability insurance
in such policy year, shall cause the remaining coverage
available under such policy to be less than $25,000,000, (i)
Owner shall, or shall cause Tenant to, promptly notify Lender
thereof, and (ii) Owner shall, or shall cause Tenant to,
within sixty (60) days thereafter, obtain additional
commercial general public liability insurance complying with
the requirements of this paragraph in an amount which will
cause the aggregate commercial general public liability
insurance coverage available to be not less than $50,000,000
combined single limit coverage per occurrence and in the
aggregate in such policy year, or such greater limits as may
be required from time to time by Lender consistent with
insurance coverage on properties similarly constructed,
occupied and maintained in the limited service budget
sector.
(iii) Worker's
compensation insurance (including employers' liability
insurance, if requested by Lender) to the extent required by
the law of the State in which the Mortgaged Property is
located.
(iv) Flood insurance in an
amount equal to the full replacement cost of the applicable
Mortgaged Property or the maximum amount available through
the National Flood Program or any successor program,
whichever is less, if all or any portion of the Improvements
related to that Mortgaged Property are located in an area
which has been designated by the Secretary of Housing and
Urban Development or by the Federal Emergency Management
Agency as having special flood hazards, and if flood
insurance is available under the National Flood Insurance
Act.
(v) if
the Mortgaged Property or any part thereof is situated in an
area now or subsequently designated as a "Zone 1 or Zone 2
Earthquake Zone" by the U.S. Geological Survey, earthquake
insurance in an amount equal to the replacement cost of the
Mortgaged Property or the maximum amount of earthquake
insurance available, whichever is the lesser.
(vi) During
any period during which construction is conducted on the
Property and during which period the construction and
materials are not covered by the existing policies, premium
prepaid insurance policies covering the Property (which
during construction shall be on an "All-Risk" perils,
including theft, "Builder's Risk", "Completed Value" form) in
amounts equal to the replacement costs of the Improvements
(including construction materials and personal property on or
off site) covering insurance risks .
no less broad than those covered under a Standard Multi Peril
(SMP) policy form, which contains a 1987 Commercial ISO
"Causes of Loss-Special Form", with coverage for such other
expenses as Lender may reasonably require. Such insurance
shall contain an agreed amount endorsement (such amount to
include foundation and underground pipes) and bear a 100 %
co-insurance clause. Said policies shall contain a permission
to occupy endorsement.
(vii) During
any period when construction is conducted on the Property,
worker's compensation, employers' liability, commercial auto
liability, and commercial general liability insurance
(including contractual liability and completed operations
coverage) for each general contractor written on a 1986 or
1993 standard "ISO" occurrence basis form or equivalent and
excess umbrella coverage, carried during the course of
construction, with general liability insurance limits of at
least $5,000,000 combined single limit for bodily injury or
death to any one person, $10,000,000 for bodily injury or
death to any number of persons in respect of any one accident
or occurrence and $1,000,000 for property damage in respect
of one accident or occurrence, with coverage for blanket
contractual, personal injury, bodily injury and property
damage of not less than $50,000,000 single limit
coverage.
(viii) Such
other insurance as may from time to time be reasonably
required by Lender in order to protect its interests,
provided that such insurance is then customarily maintained
by prudent budget motel operators, managers or owners or is
then customarily required by prudent lenders with respect to
mortgage loans secured by budget motel
properties.
(b) Owner
shall not carry separate insurance, concurrent in kind or
form or contributing in the event of loss, with any insurance
required under Section 2.4(a) or required under the Master
Lease; provided,
however,
that notwithstanding the foregoing, Owner may carry
additional insurance not required under this Indenture or the
Master Lease, provided any such insurance affecting the
Mortgaged Property shall be for the mutual benefit of Owner
and Lender, as their respective interests may appear, and
shall be subject to all other provisions of this Section
2.4.
(c) Such
insurance shall be issued by companies authorized to transact
business in the state in which the applicable Mortgaged
Property is located and having an Alfred M. Best Company.
rating of "A" or better and financial size category of not
less than X, and an S&P rating of "A" or better as to
claims paying ability provided that with respect to worker's
compensation insurance such insurance company must have an
Alfred M. Best Company rating of "A" or better and financial
size category of not less than VIII. No liability insurance
policy maintained by Tenant thereunder shall provide for a
deductible or self-insured retention in excess of $250,000,
unless either Tenant or Master Lease Guarantor then maintains
an Investment Grade Rating and no Lease Event of Default
shall have occurred and be continuing, in which event the
retention shall not be in excess of $1,000,000. No casualty
or other insurance policy maintained by Tenant (other than
liability policies) hereunder shall provide for a deductible
or self-insured retention in excess of $100,000, unless
either Tenant or Master Lease Guarantor then maintains an
Investment Grade Rating and no Lease Event of Default shall
have occurred and be continuing, in which event the retention
shall not be in excess of $250,000. However, if either Tenant
or Master Lease Guarantor then maintains an Investment Grade
Rating and no Lease Event of Default shall have occurred and
be continuing, the retention shall not be in excess of the
following amounts: (i) $500,000 for general property damage;
(ii) $500,000 for boiler damage; (iii) $250,000 for flood
damage; (iv) with respect to earthquake damage, 10% of the
value of any particular Mortgaged Property, with a total
retention for all applicable Mortgaged Properties owned or
leased by Tenant equal to $2,500,000; and (v) with respect to
wind (including hurricane) damage, 10% of the value of any
particular Mortgaged Property, with a total retention for all
applicable Mortgaged Properties owned or leased by Tenant
equal to $1,000,000. Owner shall or shall cause Tenant to,
deliver to Lender promptly after receipt thereof, and in no
event later than 90 days after the effective date thereof,
originals or certified copies of all insurance policies (or
amendments thereto). Owner shall, or shall cause Tenant to,
deliver to Lender original binders or original
or
certified certificates evidencing such policies (or
amendments) and bearing notations evidencing the payment of
premiums therefor no later than ten (10) days prior to the
effective date of such policies (or amendments). Owner shall,
or shall cause Tenant to, promptly upon receipt but in no
event less than ten (10) days prior to the expiration date of
any of the insurance policies required to be maintained
pursuant to this Indenture, deliver to Lender, or cause Tenant
to deliver to Lender, originals or certified copies of
certificates evidencing the renewals of such policies bearing
notations evidencing the payment of premiums,
(d) Every
such policy (other than general public liability, auto
liability or worker's compensation policy with respect to the
requirements of clause (iii) of this Section 2.4(d)), whether
maintained by Owner or Tenant, shall be endorsed to provide
that:
(i) such
insurance will not be canceled or amended except after thirty
(30) days' written notice to Lender and that it shall not be
invalidated by any act or negligence of Owner, Tenant or any
person or entity having an interest in the Mortgaged
Property, nor by occupancy or use of the Mortgaged Property
for purposes more hazardous than permitted by such policy,
nor by any foreclosure or other proceedings relating to the
Mortgaged Property, nor by change in title to or ownership of
the Mortgaged Property;
(ii) Lender
is an additional insured with the understanding that any
obligation imposed upon the insured (including, without
limitation, the liability to pay premiums, but excluding any
obligation of the insured to cooperate with any insurer or
any insurer's representative in the investigation, defense or
settlement of any claim covered under such insurance) shall
be the sole obligation of Owner (or Tenant) and not that of
any other insured;
(iii) all Insurance
Proceeds payable under any such policy of insurance with
respect to the Mortgaged Property shall be paid to Lender as
sole loss payee under a standard mortgagee's
clause;
(iv) the
interests of Lender shall not be invalidated by any action or
inaction of Owner, Tenant or any other Person, and such
insurance shall insure Lender regardless of any breach or
violation by Tenant, Owner or any other Person of any
warranties, declarations or conditions contained in the
policies relating to such insurance or application
therefor;
(v) the
insurer thereunder waives all rights of subrogation against
Lender and waives any right of set-off and counterclaim and
any other right of deduction, whether by attachment or
otherwise;
(vi) such
insurance shall be primary without right of contribution from
any other insurance carried by or on behalf of Tenant or
Owner or Lender or any other Person with respect to its
interest in the Mortgaged Property; and
(vii) all terms,
conditions, insuring agreements and endorsements, with the
exception of limits of liability, shall operate in the same
manner as if there were a separate policy covering each
insured.
(e) If
Owner or Tenant fails to maintain and deliver or fails to
cause to be maintained and delivered to Lender the original
policies and certificates of insurance required by this
Indenture, Lender may, at its option, procure such insurance,
and Owner shall reimburse Lender in the amount of all such
premiums thereon promptly, upon demand by Lender, with
interest thereon at the Default Rate from the date paid by
Lender to the date of repayment, and such sum shall be a part
of the Indebtedness secured by this Indenture, but this
sentence shall not prevent any default under this Section 2.4
from becoming an Event of Default.
(f) In
the event of any casualty affecting all or any portion of the
Mortgaged Property or of any Taking or proposed Taking with
respect thereto, Owner shall, at such time as Owner has
obtained actual knowledge thereof, give prompt written notice
thereof to Lender (which notice shall set forth Owner's good
faith estimates of the cost of repairing or restoring any
damage or destruction caused thereby), or, if Owner cannot
reasonably estimate the anticipated cost of such restoration,
Owner shall nonetheless give Lender prompt notice of the
occurrence of any such casualty, Taking or proposed Taking,
and will diligently proceed to obtain estimates to enable
Owner to quantify the anticipated cost of such restoration,
whereupon Owner shall promptly notify Lender of such good
faith estimate. Lender is hereby irrevocably appointed as
Owner's attorney-in-fact, coupled with an interest, with full
power of substitution, with exclusive power to collect,
receive and retain the Loss Proceeds relating to any such
casualty or Taking, subject to the provisions of this
Indenture and subject to Tenant's rights under Sections 3.2
and 3.6 of the Master Lease, and, with exclusive power after
the occurrence and during the continuance of any Event of
Default, to make any compromise or settlement in connection
with any such casualty or Taking, subject to the rights of
Tenant pursuant to Sections 3.2(a) and 3.7(f) of the Master
Lease provided no Lease Event of Default shall have occurred
and be continuing. Owner shall execute and deliver to Lender
any and all instruments reasonably required in connection
with any such casualty, Taking or compromise or settlement
proceeding promptly after request therefor by Lender. So long
as no Event of Default shall have occurred and be continuing,
Owner may adjust, compromise, settle or enter into any
agreement with respect to any such casualty, Taking,
compromise or settlement proceedings with the prior written
consent of Lender, which consent shall not be unreasonably
withheld or delayed and which consent shall not be required
for any adjustment, compromise or settlement of Loss Proceeds
in an amount less than $100,000. If a casualty or a Taking
shall affect all or a substantial portion of the Mortgaged
Property in such a manner as to allow or require Tenant to
make a Rejectable Offer or a Rejectable Substitution Offer
pursuant to Sections 3.2(b) and 3.3(a) of the Master Lease,
any Loss Proceeds shall be held by Lender until applied in
accordance with Section 2.4(k). In the event that the Master
Lease is not terminated with respect to the related Mortgaged
Property as a result of the casualty or Taking and no Lease
Event of Default has occurred and is continuing, the Loss
Proceeds will be made available for the repair, restoration
and rebuilding of the related Mortgaged Property (such
repair, restoration and rebuilding are sometimes hereinafter
collectively referred to as the
Work)
so damaged or destroyed or taken in full compliance with all
Legal Requirements pursuant to the terms and subject to the
conditions of Section 2.4(g) hereof and, for purposes hereof,
Lender shall be deemed to have elected to make such Loss
Proceeds available for the Work. If a Lease Event of Default
has occurred and is continuing, the Loss Proceeds may be
applied to reduce the Indebtedness by Lender, at its sole
option. If the Loss Proceeds are so applied to reduce the
Indebtedness, Lender shall apply the same in accordance with
the applicable provisions of this Indenture and Owner shall
not be obligated to restore the damage to the related
Mortgaged Property. In the event that Lender elects, or is
deemed to have elected, to allow Loss Proceeds to be used for
the Work or if Lender is required under the Master Lease to
make the Loss Proceeds available for the Work, all excess Loss
Proceeds with respect to a casualty and excess proceeds up to
and including $100,000 with respect to a condemnation
remaining after completion of such Work, so long as no Lease
Event of Default has occurred and is continuing, shall be paid
over to Tenant, provided,
however,
that if a Lease Event of Default has occurred and is
continuing, all such excess Loss Proceeds may be applied to
the payment of the Indebtedness by Lender, at its sole option.
If the amount of Loss Proceeds with respect to a Taking
remaining after completion of the related Work, final payment
therefor and reimbursement to Tenant of any amount contributed
by it to the cost of such Work is in excess of $100,000, such
Loss Proceeds in excess of such $100,000 shall be paid over to
Owner provided,
however,
that if an Event of Default has occurred and is continuing,
all such excess Loss Proceeds otherwise required to be paid
over to Owner shall be paid to Lender and may be applied to
the payment of the Indebtedness by Lender, at its sole option.
All Loss Proceeds paid with respect to any casualty or Taking
affecting all or any portion of the Mortgaged Property are
hereby assigned and shall be paid directly to Lender subject
to the terms and conditions hereof and subject to the rights
of the Tenant under the Master Lease. Lender shall deposit any
Loss Proceeds received by it into the Restoration Account. If
any Loss Proceeds are received by Owner, such Loss Proceeds
shall be received in trust for Lender, shall be segregated
from other funds of Owner, and shall be forthwith paid to
Lender to be held in a segregated account controlled by
Lender, in each case to be applied or disbursed in accordance
with the foregoing.
(g) If
Lender elects, or is deemed to have elected, to allow the
Loss Proceeds to be used for the Work or if Lender is
required under the Master Lease to make the Loss Proceeds
available for the Work, in accordance with Section 2.4(f) or
in accordance with Section 2.5, then such Loss Proceeds shall
be held by Lender and shall be paid out from time to time on
a monthly basis to Owner as the Work progresses (less any
cost to Tenant, Lender or Owner of recovering and paying out
such Loss Proceeds, including, without limitation, reasonable
attorneys', trustees' or escrow fees related thereto and
costs allocable to inspecting the Work and the plans and
specifications therefor), subject to compliance by Tenant
with each of the applicable provisions of the Master Lease
and, without duplication, each of the following
conditions:
(i) If
the Work constitutes Material Alterations, the provisions of
Section 2.3(c) shall apply and either the Authorized
Representative of Owner or, if the Work is required to be
performed under the supervision of an Architect pursuant to
Section 2.3, the Architect selected by Owner or by Tenant and
reasonably acceptable to Lender, shall have delivered to
Lender a certificate estimating the cost of completing the
Work. If the amount set forth therein is more than the amount
of Loss Proceeds then being held by Lender in connection with
a casualty to or partial Taking of the Mortgaged Property,
Owner or Tenant shall have delivered or caused to be
delivered to Lender (w) cash collateral in an amount equal to
such excess, or (x) an unconditional, irrevocable, clean
sight draft letter of credit, in form and substance, and
issued by a bank, acceptable to Lender in its reasonable
discretion, in the amount of such excess, or (y) a bond in
form and from an institution reasonably acceptable to Lender
in the amount of such excess, or (z) evidence acceptable to
Lender that the excess has been expended in performing the
Work prior to any funds being drawn from the Loss Proceeds;
provided, however, that if no Lease Event of Default shall
have occurred and be continuing and at such time and
thereafter until completion of such Material Alterations
Tenant or Master Lease Guarantor has an Investment Grade
Rating and the cost of completing such Work in excess of the
amount of Loss Proceeds then being held by Lender does not
exceed $1,500,000 as to that Mortgaged Property (as adjusted
for changes in the consumer price index), neither Owner nor
Tenant shall be required to have complied with this
sentence)
(ii) Each
request for payment shall be made on not less than ten (10)
Business Days prior notice to Lender and shall be accompanied
by an Officer's Certificate (or if such Work is being
performed.under the supervision of an Architect, by a
certificate of such Architect), stating (A) in the case of an
Officer's Certificate only, that no Lease Event of Default
exists, (B) that, based upon an inspection of the Mortgaged
Property, all of the Work completed has been done in
substantial compliance with the approved plans and
specifications, if required under Section 2.3(c), (C) that
the sum requested is validly required to reimburse Owner or
Tenant, as applicable, for payments by Owner or Tenant, as
applicable, or is validly due to the contractor,
subcontractors, materialmen, laborers, engineers, architects
or other persons rendering services or materials for the Work
(giving a brief description of such services and materials),
and that when added to all sums previously paid out by Lender
does not exceed the value of the Work done to the date of
such certificate, (D) if the sum requested is to cover
payment relating to repair and restoration of personal
property required or relating to the Mortgaged Property, that
title to the personal property items covered by the request
for payment is vested in Owner or Tenant, as applicable, and
(E) the remaining cost to complete such Work and that the
remaining amount held by Lender (together with any amounts
contemporaneously deposited with Lender in the Restoration
Account in connection herewith) shall be sufficient to cover
the cost of completion of such Work; provided,
however,
that if such certificate is given by an Architect, such
Architect shall certify as to clause (B) above, and the
Authorized Representative of Owner shall certify as to the
remaining clauses above, and provided, further, that Lender
shall not be obligated to disburse such funds if the
provisions of Section 2.4(g)(vii) are applicable.
Additionally, each request for payment shall contain a
statement signed by Owner approving both the Work done to
date and the Work covered by the request for payment in
question. To the extent that Tenant is performing
the
Work
rather than Owner, all certificates and other items shall be
required to be delivered from Tenant, rather than
Owner.
(iii) Each
request for payment shall be accompanied by waivers of lien
reasonably satisfactory to Lender covering that part of the
Work for which payment or reimbursement has been made as of
the date of the current request and, if required by Lender, a
search prepared by a title company or licensed abstractor, or
by other evidence satisfactory to Lender that there has not
been filed with respect to the Mortgaged Property any
mechanics, or other lien or instrument for the retention of
title relating to any part of the Work not discharged of
record, and such other contractors affidavits, plots of
survey and evidence of cost, payment and performance as
Lender may reasonably request and approve. Additionally, as
to any personal property covered by the request for payment,
Lender shall be furnished with evidence of payment therefor
and such further evidence satisfactory to assure Lender of
its valid first lien on and security interest in the personal
property.
(iv) Lender
and its architects or duly authorized construction
representatives shall have the right to inspect the Work at
all reasonable times upon reasonable prior notice and may
condition any disbursement of Loss Proceeds upon the
satisfactory completion, as determined in Lender's sole
discretion, of any portion of the Work for which payment or
reimbursement is being requested. Neither the approval by
Lender of any required plans and specifications for the Work
nor the inspection by Lender of the Work shall make Lender
responsible for the preparation of such plans and
specifications or the compliance of such plans and
specifications, or of the Work, with any applicable Legal
Requirement, covenant or agreement.
(v) Loss
Proceeds shall not be disbursed more frequently than once
every thirty (30) days provided, however, that if any Event
of Default has occurred and is continuing or if at such time
neither Tenant nor Master Lease Guarantor has an Investment
Grade Rating, no disbursement made prior to final completion
of such Work shall exceed 90% of the value of such Work
performed from time to time.
(vi) Upon
completion of the Work and payment in full therefor, Lender
shall apply any such Loss Proceeds it then or thereafter
holds first to disburse any amount it has previously held
back pursuant to clause (v) above to the Person or Persons
entitled thereto and then in accordance with the provisions
of Section 2.4(f).
(vii) Notwithstanding
any other provision of this Section 2.4(g), so long as Owner
or Tenant fails promptly to commence the Work or to proceed
diligently and continuously to complete the Work or a Lease
Event of Default has occurred and is continuing, Lender, in
its sole discretion, may apply any Loss Proceeds held by it
to continue the Work, to make any Advances it .
may, in its sole discretion, decide to make with respect to
the Mortgaged Property or apply such Loss Proceeds to pay or
prepay, in whole or in part, any Indebtedness. No such
Advance by Lender shall cure an Event of Default, and Owner
shall be obligated to immediately reimburse such amount to
Lender, together with interest accrued thereon at the Default
Rate.
Loss
Proceeds held by Lender in accordance with this Section 2.4(g)
shall be held in an interest bearing account (which account
shall be an Eligible Account).
Notwithstanding
any other provision of this Section 2.4, if either Tenant or
Master Lease Guarantor is then currently maintaining an
Investment Grade Rating and in Tenant's reasonable judgment
the cost of the Work is less than $500,000 with respect to any
one casualty or partial condemnation (and the cost of all
outstanding Work for all Mortgaged Properties at such time is
less than $1,000,000), such Work can be completed in less than
one hundred twenty (120) days and no Lease Event of Default
has occurred and is continuing, then Lender, upon request by
Owner, shall permit Owner or Tenant to apply for and receive
the Loss Proceeds directly from the insurer or payor thereof
(and Lender shall advise such insurer or payor to pay over
such Loss Proceeds directly to Owner or Tenant), provided that
Owner or Tenant shall promptly and diligently commence and
complete such Work.
(h) If
any Lease Event of Default shall have occurred and be
continuing or if Owner or Tenant, as applicable, (i) shall
fail to submit to Lender for approval plans and
specifications (if required pursuant to Section 2.3(c)
hereof) for the Work (approved by the Architect and by all
Governmental Authorities whose approval is required), (ii)
after any such plans and specifications for the Work are
approved by all such Governmental Authorities, by the
Architect and, if required hereunder, by Lender, shall fail
to commence promptly such Work, (iii) after Lender has
released the Loss Proceeds to the extent provided for
hereunder, shall fail to diligently prosecute such Work to
completion, or (iv) materially fail in any other respect to
comply with the Work obligations under this Section 2.4,
then, in addition to all other rights available hereunder, at
law or in equity, Lender, or any receiver of the Mortgaged
Property or any portion thereof, upon fifteen (15) days prior
written notice to Owner and Tenant (except in the event of
emergency in which case no notice shall be required), may
(but shall have no obligation to) perform or cause to be
performed such Work, and may take such other steps as it
deems advisable, but this sentence shall not prevent any
default by Owner from becoming an Event of Default or any
default by Tenant from becoming a Lease Event ,
of Default. For this purpose Owner constitutes and appoints
Lender its true and lawful attorney-in-fact with full power
of substitution to complete or undertake Work in the name of
Owner. Such power of attorney shall be deemed to be a power
coupled with an interest and cannot be revoked. Owner
empowers said attorney-in-fact as follows: (i) to use any
funds in the Restoration Account for the purpose of making or
completing the Work; (ii) to make such additions, changes and
corrections to the Work as shall be necessary or desirable to
complete the Work; (iii) to employ such contractors,
subcontractors, agents, architects and inspectors as shall be
required for such purposes; (iv) to pay, settle or compromise
all existing bills and claims which are or may become Liens
against any Mortgaged Property, or as may be necessary or
desirable for the completion of the Work, or for clearance of
title; (v) to execute all applications and certificates in
the name of Owner which may be required by any of the
contract documents; (vi) to prosecute and defend all actions
or proceedings in connection with any Mortgaged Property or
the rehabilitation and repair of any Mortgaged Property; and
(vii) to do any and every act which Owner might do in its own
behalf to fulfill the terms of this
indenture.
Nothing in this Section 2.4(h) shall (1) make Lender
responsible for making or completing the Work, (ii) require
Lender to expend funds to complete any Work; (ii) obligate
Lender to proceed with the Work; or (iv) obligate Lender to
demand from Owner or Tenant additional sums to complete any
Work. Owner hereby waives, for Owner and all others holding
under or through Owner, any claim, other than for willful
misconduct, against Lender and any receiver arising out of any
act or omission of Lender or such receiver pursuant hereto,
and Lender may apply all or any portion of the Loss Proceeds
(without the need to fulfill any other requirements of this
Section 2.4) to reimburse Lender and such receiver, for all
amounts incurred in connection with the Work, and any costs
not reimbursed to Lender or the receiver shall be paid by
Owner to Lender or such receiver upon demand together with
interest thereon at the Default Rate from the date such
amounts are advanced until the same are paid to Lender or the
receiver, and such sum shall be part of the Indebtedness
secured by this Indenture.
(i) Except
as set forth in Section 2.4(f) hereof and provided that no
Event of Default shall have occurred and be continuing (in
which event Lender may exclusively settle insurance claims
without Owner), Lender and Owner shall settle any insurance
claims jointly provided, however, that unless a Lease Event
of Default shall have occurred and be continuing, Tenant
shall be allowed to settle such claims, if allowed pursuant
to the Master Lease. Owner hereby irrevocably appoints Lender
as its attorney-in-fact, coupled with an interest, with full
power of substitution, to obtain, collect and receive any
Loss Proceeds paid with respect to any portion of the
Mortgaged Property or the insurance policies required to be
maintained hereunder, and to endorse any checks, drafts or
other instruments representing any Loss Proceeds whether
payable by reason of casualty or condemnation or
otherwise.
(j) Notwithstanding
anything to the contrary in any of the Loan
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