EXHIBIT 10.5

 

GUARANTY OF RECOURSE OBLIGATIONS

This GUARANTY OF RECOURSE OBLIGATIONS (this “Guaranty”) is executed as of
February 28, 2014 by ALEXANDER’S INC., a Delaware corporation, having an address
at 210 Route 4 East, Paramus, New Jersey 07652 (together with  successors and/or
assigns, “Guarantor”), for the benefit of GERMAN AMERICAN CAPITAL CORPORATION, a
Maryland corporation, having an address at 60 Wall Street, 10th Floor, New York,
New York 10005 (collectively, together with its successors and/or assigns,
“Lender”). 

W I T N E S S E T H:

A.                Pursuant to that certain Consolidated, Amended and Restated
Promissory Note, dated of even date herewith, executed by 731 OFFICE ONE LLC, a
Delaware limited liability company (“Borrower”), and payable to the order of
Lender in the original principal amount of THREE HUNDRED MILLION and No/100
Dollars ($300,000,000.00) (together with all renewals, modifications, increases
and extensions thereof, the “Note”), Borrower has become indebted, and may from
time to time be further indebted, to Lender with respect to a loan (the “Loan”)
which is made pursuant to that certain Loan Agreement, dated of even date
herewith, between Borrower and Lender (as the same may be amended, modified,
supplemented, replaced or otherwise modified from time to time, the “Loan
Agreement”).  Capitalized terms used but not otherwise defined herein shall have
the meanings ascribed to such terms in the Loan Agreement.

B.                 Lender is not willing to make the Loan, or otherwise extend
credit, to Borrower unless Guarantor unconditionally guarantees the payment and
performance to Lender of the Guaranteed Obligations (as herein defined).

C.                 Guarantor is the owner of direct or indirect interests in
Borrower, and Guarantor will directly benefit from Lender’s making the Loan to
Borrower.

NOW, THEREFORE, as an inducement to Lender to make the Loan to Borrower and to
extend such additional credit as Lender may from time to time agree to extend
under the Loan Documents, and for other good and valuable consideration, the
receipt and legal sufficiency of which are hereby acknowledged, the parties do
hereby agree as follows:

ARTICLE 1
NATURE AND SCOPE OF GUARANTY

SECTION 1.1      GUARANTY OF OBLIGATION

(A)                  GUARANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY GUARANTEES
TO LENDER AND ITS SUCCESSORS AND ASSIGNS THE PAYMENT OF THE GUARANTEED
OBLIGATIONS (AS DEFINED BELOW) AS AND WHEN THE SAME SHALL BE DUE AND PAYABLE,
WHETHER BY LAPSE OF TIME, BY ACCELERATION OF MATURITY OR OTHERWISE.  GUARANTOR
HEREBY IRREVOCABLY AND UNCONDITIONALLY COVENANTS AND AGREES THAT IT IS LIABLE
FOR THE GUARANTEED OBLIGATIONS AS A PRIMARY OBLIGOR. 

 

 

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(B)               AS USED HEREIN, THE TERM “GUARANTEED OBLIGATIONS” MEANS (A) 
BORROWER'S RECOURSE LIABILITIES SET FORTH IN SECTION 10.1 OF THE LOAN AGREEMENT,
AND (B) FROM AND AFTER THE DATE THAT ANY SPRINGING RECOURSE EVENT OCCURS,
PAYMENT OF ALL OF THE OBLIGATIONS. 

(C)                NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS GUARANTY OR
IN ANY OF THE OTHER LOAN DOCUMENTS, LENDER SHALL NOT BE DEEMED TO HAVE WAIVED
ANY RIGHT WHICH LENDER MAY HAVE AGAINST BORROWER UNDER SECTION 506(A), 506(B),
1111(B) OR ANY OTHER PROVISIONS OF THE BANKRUPTCY CODE TO FILE A CLAIM FOR THE
FULL AMOUNT OF THE OBLIGATIONS OR TO REQUIRE THAT ALL COLLATERAL SHALL CONTINUE
TO SECURE ALL OF THE OBLIGATIONS OWING TO LENDER IN ACCORDANCE WITH THE LOAN
DOCUMENTS.

Section 1.2      Nature of Guaranty.  This Guaranty is an irrevocable, absolute,
continuing guaranty of payment and not a guaranty of collection.  This Guaranty
may not be revoked by Guarantor and shall continue to be effective with respect
to any Guaranteed Obligations arising or created after any attempted revocation
by Guarantor and after (if Guarantor is a natural person) Guarantor’s death (in
which event this Guaranty shall be binding upon Guarantor’s estate and
Guarantor’s legal representatives and heirs).  The fact that at any time or from
time to time the Guaranteed Obligations may be increased or reduced shall not
release or discharge the obligation of Guarantor to Lender with respect to the
Guaranteed Obligations.  This Guaranty may be enforced by Lender and any
subsequent holder of the Note and shall not be discharged by the assignment or
negotiation of all or part of the Note.

Section 1.3    Guaranteed Obligations Not Reduced by Offset.  The Guaranteed
Obligations and the liabilities and obligations of Guarantor to Lender hereunder
shall not be reduced, discharged or released because or by reason of any
existing or future offset, claim or defense of Borrower or any other party
against Lender or against payment of the Guaranteed Obligations, whether such
offset, claim or defense arises in connection with the Guaranteed Obligations
(or the transactions creating the Guaranteed Obligations) or otherwise.

Section 1.4       Payment By Guarantor.  If  all or any part of the Guaranteed
Obligations shall not be punctually paid when due, whether at demand, maturity,
acceleration or otherwise, Guarantor shall, immediately upon demand by Lender
and, other than as expressly provided in the Loan Documents, without
presentment, protest, notice of protest, notice of non-payment, notice of
intention to accelerate the maturity, notice of acceleration of the maturity or
any other notice whatsoever, all such notices being hereby waived by Guarantor,
pay in lawful money of the United States of America, the amount due on the
Guaranteed Obligations to Lender at Lender’s address as set forth herein.  Such
demand(s) may be made at any time coincident with or after the time for payment
of all or part of the Guaranteed Obligations and may be made from time to time
with respect to the same or different items of Guaranteed Obligations.  Such
demand shall be deemed made, given and received in accordance with the notice
provisions hereof.

Section 1.5       No Duty To Pursue Others.  It shall not be necessary for
Lender (and Guarantor hereby waives any rights which Guarantor may have to
require Lender), in order to enforce the obligations of Guarantor hereunder,
first to (i) institute suit or exhaust its remedies against Borrower or others
liable on the Loan or the Guaranteed Obligations or any other Person,
(ii) enforce Lender’s rights against any collateral which shall ever have been
given to secure the Loan, (iii) enforce Lender’s rights against any other
guarantors of the Guaranteed Obligations,

                                                                              

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(iv) join Borrower or any others liable on the Guaranteed Obligations in any
action seeking to enforce this Guaranty, (v) exhaust any remedies available to
Lender against any collateral which shall ever have been given to secure the
Loan, or (vi) resort to any other means of obtaining payment of the Guaranteed
Obligations.  Lender shall not be required to mitigate damages or take any other
action to reduce, collect or enforce the Guaranteed Obligations.

 

Section 1.6      Waivers.   Guarantor agrees to the provisions of the  Loan
Documents and hereby waives notice of (i) any loans or advances made by Lender
to Borrower, (ii) acceptance of this Guaranty, (iii) any amendment or extension
of the Note, the Mortgage, the Loan Agreement or any other Loan Document,
(iv) the execution and delivery by Borrower and Lender of any other loan or
credit agreement or of Borrower’s execution and delivery of any promissory note
or other document arising under the Loan Documents or in connection with the
Property, (v) the occurrence of (A) any breach by Borrower of any of the terms
or conditions of the Loan Agreement or any of the other Loan Documents, or
(B) an Event of Default, (vi) Lender’s transfer or disposition of the Guaranteed
Obligations, or any part thereof, (vii) the sale or foreclosure (or the posting
or advertising for the sale or foreclosure) of any collateral for the Guaranteed
Obligations, (viii) protest, proof of non-payment or default by Borrower, or
(ix) any other action at any time taken or omitted by Lender and, generally,
except as expressly provided in the Loan Documents, all demands and notices of
every kind in connection with this Guaranty, the Loan Documents, any documents
or agreements evidencing, securing or relating to any of the Guaranteed
Obligations and/or the obligations hereby guaranteed.

 

Section 1.7       Payment of Expenses.    In the event that Guarantor  shall
breach or fail to timely perform any provisions of this Guaranty, Guarantor
shall, immediately within five (5) Business Days following demand by Lender, pay
Lender all costs and expenses (including court costs and reasonable attorneys’
fees) incurred by Lender in the enforcement hereof, together with interest
thereon at the Default Rate from the date due, but without duplication of any
such costs or expenses actually paid by Borrower.  The covenant contained in
this Section shall survive the payment and performance of the Guaranteed
Obligations.

Section 1.8    Effect of Bankruptcy.    In the event that pursuant to any
insolvency, bankruptcy, reorganization, receivership or other debtor relief law
or any judgment, order or decision thereunder, Lender must rescind or restore
any payment or any part thereof received by Lender in satisfaction of the
Guaranteed Obligations, as set forth herein, any prior release or discharge from
the terms of this Guaranty given to Guarantor by Lender shall be without effect
and this Guaranty shall remain (or shall be reinstated to be) in full force and
effect.  It is the intention of Borrower and Guarantor that Guarantor’s
obligations hereunder shall not be discharged except by Guarantor’s performance
of such obligations and then only to the extent of such performance.

Section 1.9    Waiver of Subrogation, Reimbursement and
Contribution.    Notwithstanding anything to the contrary contained in this
Guaranty, Guarantor hereby unconditionally and irrevocably waives, releases and
abrogates any and all rights it may now or hereafter have under any agreement,
at law or in equity (including, without limitation, any law subrogating
Guarantor to the rights of Lender), to assert any claim against or seek
contribution, indemnification or any other form of reimbursement from Borrower
or any other party liable for the payment of any or all of the Guaranteed
Obligations for any payment made by Guarantor

                                                                         

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under or in connection with this Guaranty or otherwise (it being understood that
any such right, claim, remedy or benefit of Guarantor shall be available to it
following the repayment in full of the Loan).

Section 1.10   Termination,   This Guaranty shall terminate and be of no further
force and effect upon the date which is ninety-one (91) days subsequent to the
earlier of the date on which (x) the Loan has been paid and satisfied or
defeased in full (exclusive of any indemnification or other obligations which
pursuant to the terms of the Loan Documents survive satisfaction or defeasance
of the Note) or (y) the Lien of the Mortgage has been released in accordance
with the terms of the Loan Agreement and the other Loan Documents; provided,
however, that Guarantor’s liability hereunder shall survive such termination
with respect to any and all Guaranteed Obligations related to or arising from
acts, events or circumstances which occurred prior to such date.  Upon such
termination, at the request of Guarantor, Lender shall deliver a written
statement confirming the termination of this Guaranty, subject to and in
accordance with this Section 1.10.  Notwithstanding anything to the contrary
contained herein, Guarantor shall not have any liability hereunder with respect
to any acts, events or circumstances first arising after the date on which
Lender or its agent, representative, designee or purchaser acquires title to the
Property, whether through foreclosure, private power of sale or the delivery of
a deed-in-lieu of foreclosure.  In addition, in no event shall Guarantor have
any liability hereunder with respect to any specific acts taken by any receiver,
conservator, trustee or liquidator that is not an Affiliate of Guarantor and is
appointed by or on behalf of Lender.

ARTICLE 2
EVENTS AND CIRCUMSTANCES NOT REDUCING
OR DISCHARGING GUARANTOR’S OBLIGATIONS

Guarantor hereby consents and agrees to each of the following and agrees that
Guarantor’s obligations under this Guaranty shall not be released, diminished,
impaired, reduced or adversely affected by any of the following and waives any
common law, equitable, statutory or other rights (including, without limitation,
rights to notice) which Guarantor might otherwise have as a result of or in
connection with any of the following:

Section 2.1      Modifications.  Any renewal, extension, increase, modification,
alteration or rearrangement of all or any part of the Guaranteed Obligations,
the Note, the Mortgage, the Loan Agreement, the other Loan Documents or any
other document, instrument, contract or understanding between Borrower and
Lender or any other parties pertaining to the Guaranteed Obligations or any
failure of Lender to notify Guarantor of any such action.

Section 2.2       Adjustment.   Any adjustment, indulgence, forbearance or
compromise that might be granted or given by Lender to Borrower or Guarantor,
except to the extent of such adjustment, indulgence, forbearance or compromise,
as applicable.

Section 2.3       Condition of Borrower or Guarantor.    The insolvency,
bankruptcy, arrangement, adjustment, composition, liquidation, disability,
dissolution or lack of power of Borrower, Guarantor or any other Person at any
time liable for the payment of all or part of the Guaranteed Obligations; or any
dissolution of Borrower or Guarantor or any sale, lease or transfer of any or
all of the assets of Borrower or Guarantor or any changes in the direct or

                                                                          

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indirect shareholders, partners or members, as applicable, of Borrower or
Guarantor; or any reorganization of Borrower or Guarantor.

Section 2.4         Invalidity of Guaranteed Obligations.    The invalidity,
illegality or unenforceability of all or any part of the Guaranteed Obligations
or any document or agreement executed in connection with the Guaranteed
Obligations for any reason whatsoever, including, without limitation, the fact
that (i) the Guaranteed Obligations or any part thereof exceeds the amount
permitted by law, (ii) the act of creating the Guaranteed Obligations or any
part thereof is ultra vires, (iii) the officers or representatives executing the
Note, the Mortgage, the Loan Agreement or the other Loan Documents or otherwise
creating the Guaranteed Obligations acted in excess of their authority, (iv) the
Guaranteed Obligations violate applicable usury laws, (v) the Borrower had valid
defenses, claims or offsets, whether at law, in equity or by agreement (other
than the defense of payment of the Guaranteed Obligations), which render the
Guaranteed Obligations wholly or partially uncollectible from Borrower, (vi) the
creation, performance or repayment of the Guaranteed Obligations (or the
execution, delivery and performance of any document or instrument representing
part of the Guaranteed Obligations or executed in connection with the Guaranteed
Obligations or given to secure the repayment of the Guaranteed Obligations) is
illegal, uncollectible or unenforceable, or (vii) the Note, the Mortgage, the
Loan Agreement or any of the other Loan Documents have been forged or otherwise
are irregular or not genuine or authentic, it being agreed that Guarantor shall
remain liable hereon regardless of whether Borrower or any other Person be found
not liable on the Guaranteed Obligations or any part thereof for any reason.

Section 2.5         Release of Obligors.    Any full or partial release of the
liability of Borrower for the Guaranteed Obligations or any part thereof, or of
any co-guarantors, or of any other Person now or hereafter liable, whether
directly or indirectly, jointly, severally, or jointly and severally, to pay,
perform, guarantee or assure the payment of the Guaranteed Obligations, or any
part thereof, it being recognized, acknowledged and agreed by Guarantor that
Guarantor may be required to pay the Guaranteed Obligations in full without
assistance or support from any other Person, and Guarantor has not been induced
to enter into this Guaranty on the basis of a contemplation, belief,
understanding or agreement that other Persons (including Borrower) will be
liable to pay or perform the Guaranteed Obligations or that Lender will look to
other Persons (including Borrower) to pay or perform the Guaranteed Obligations.

Section 2.6         Other Collateral.    The taking or accepting of any other
security, collateral or guaranty, or other assurance of payment, for all or any
part of the Guaranteed Obligations.

Section 2.7         Release of Collateral.    Any release, surrender, exchange,
subordination, deterioration, waste, loss or impairment (including, without
limitation, negligent, willful, unreasonable or unjustifiable impairment) of any
collateral, property or security at any time existing in connection with, or
assuring or securing payment of, all or any part of the Guaranteed Obligations.

Section 2.8         Care and Diligence.    The failure of Lender or any other
party to exercise diligence or reasonable care in the preservation, protection,
enforcement, sale or other handling or treatment of all or any part of any
collateral, property or security, including, but not limited to,

                                                                            

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any neglect, delay, omission, failure or refusal of Lender (i) to take or
prosecute any action for the collection of any of the Guaranteed Obligations, or
(ii) to foreclose, or initiate any action to foreclose, or, once commenced,
prosecute to completion any action to foreclose upon any security therefor, or
(iii) to take or prosecute any action in connection with any instrument or
agreement evidencing or securing all or any part of the Guaranteed Obligations.

Section 2.9         Unenforceability.    The fact that any collateral, security,
security interest or lien contemplated or intended to be given, created or
granted as security for the repayment of the Guaranteed Obligations, or any part
thereof, shall not be properly perfected or created, or shall prove to be
unenforceable or subordinate to any other security interest or lien, it being
recognized and agreed by Guarantor that Guarantor is not entering into this
Guaranty in reliance on, or in contemplation of the benefits of, the validity,
enforceability, collectibility or value of any of the collateral for the
Guaranteed Obligations.

Section 2.10       Offset.    Any existing or future right of offset, claim or
defense (other than the defense of payment of the Guaranteed Obligations) of
Borrower against Lender, or any other party, or against payment of the
Guaranteed Obligations, whether such right of offset, claim or defense arises in
connection with the Guaranteed Obligations (or the transactions creating the
Guaranteed Obligations) or otherwise. 

Section 2.11       Merger.    The reorganization, merger or consolidation of
Borrower or Guarantor into or with any other Person.

Section 2.12       Preference.    Any payment by Borrower to Lender is held to
constitute a preference under bankruptcy laws or for any reason Lender is
required to refund such payment or pay such amount to Borrower or to any other
Person.

Section 2.13       Other Actions Taken or Omitted.    Any other action taken or
omitted to be taken with respect to the Loan Documents, the Guaranteed
Obligations or the security and collateral therefor (other than actions or
omissions expressly agreed to in writing by Lender), whether or not such action
or omission prejudices Guarantor or increases the likelihood that Guarantor will
be required to pay the Guaranteed Obligations pursuant to the terms hereof, it
being the unambiguous and unequivocal intention of Guarantor that Guarantor
shall be obligated to pay the Guaranteed Obligations when due, notwithstanding
any occurrence, circumstance, event, action or omission whatsoever, whether
contemplated or uncontemplated, and whether or not otherwise or particularly
described herein (other than actions or omissions expressly agreed to in writing
by Lender), which obligation shall be deemed satisfied only upon the full and
final payment and satisfaction of the Guaranteed Obligations.

ARTICLE 3
REPRESENTATIONS AND WARRANTIES

To induce Lender to enter into the Loan Documents and to extend credit to
Borrower, Guarantor represents and warrants to Lender as follows:

Section 3.1      Benefit.    Guarantor is an Affiliate of Borrower, is the owner
of a direct or indirect interest in Borrower and has received, or will receive,
direct or indirect benefit from the making of this Guaranty with respect to the
Guaranteed Obligations.

 

                                                           

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Section 3.2         Familiarity and Reliance.    Guarantor is familiar with, and
has independently reviewed books and records regarding, the financial condition
of Borrower and is familiar with the value of any and all collateral intended to
be created as security for the payment of the Note or Guaranteed Obligations;
however, Guarantor is not relying on such financial condition or the collateral
as an inducement to enter into this Guaranty.

Section 3.3         No Representation By Lender.    Neither Lender nor any other
party has made any representation, warranty or statement to Guarantor in order
to induce Guarantor to execute this Guaranty.

Section 3.4         Guarantor’s Financial Condition.    As of the date hereof,
and after giving effect to this Guaranty and the contingent obligation evidenced
hereby, Guarantor (a) is and will be solvent, (b) has and will have assets
which, fairly valued, exceed its obligations, liabilities (including contingent
liabilities) and debts, and (c) has and will have property and assets sufficient
to satisfy and repay its obligations and liabilities, including the Guaranteed
Obligations.

Section 3.5         Legality.    The execution, delivery and performance by
Guarantor of this Guaranty and the consummation of the transactions contemplated
hereunder do not and will not contravene or conflict with any law, statute or
regulation whatsoever to which Guarantor is subject, or constitute a default (or
an event which, with notice or lapse of time or both, would constitute a
default) under, or result in the breach of, any indenture, mortgage, charge,
lien, contract, agreement or other instrument to which Guarantor is a party or
which may be applicable to Guarantor.  This Guaranty is a legal and binding
obligation of Guarantor and is enforceable against Guarantor in accordance with
its terms, except as limited by bankruptcy, insolvency or other laws of general
application relating to the enforcement of creditors’ rights.

Section 3.6         Litigation.    There is no action, suit, proceeding or
investigation pending or, to Guarantor’s knowledge, threatened against Guarantor
in any court or by or before any other Governmental Authority, or labor
controversy affecting Guarantor or any of its properties, businesses, assets or
revenues, which would reasonably be expected to (i) materially and adversely
affect the ability of Guarantor to pay and perform its obligations under this
Guaranty or (ii) materially and adversely affect the financial condition of
Guarantor.

Section 3.7         Survival.    All representations and warranties made by
Guarantor herein shall survive the execution hereof.

ARTICLE 4
SUBORDINATION OF CERTAIN INDEBTEDNESS

Section 4.1         Subordination of All Guarantor Claims.    As used herein,
the term “Guarantor Claims” shall mean all debts and liabilities of Borrower to
Guarantor, whether such debts and liabilities now exist or are hereafter
incurred or arise, and whether the obligations of Borrower thereon be direct,
contingent, primary, secondary, several, joint and several, or otherwise, and
irrespective of whether such debts or liabilities be evidenced by note,
contract, open account, or otherwise, and irrespective of the Person or Persons
in whose favor such debts or liabilities may, at their inception, have been, or
may hereafter be, created, or the manner in

                                                                       

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which they have been, or may hereafter be, acquired by Guarantor.  The Guarantor
Claims shall include, without limitation, all rights and claims of Guarantor
against Borrower (arising as a result of subrogation or otherwise) as a result
of Guarantor’s payment of all or a portion of the Guaranteed Obligations.  So
long as an Event of Default shall have occurred and be continuing, Guarantor
shall not receive or collect, directly or indirectly, from Borrower or any
Affiliate of Borrower any amount upon the Guarantor Claims.

Section 4.2         Claims in Bankruptcy.    In the event of any receivership,
bankruptcy, reorganization, arrangement, debtor’s relief or other insolvency
proceeding involving Guarantor as a debtor, Lender shall have the right to prove
its claim in any such proceeding so as to establish its rights hereunder and
receive directly from the receiver, trustee or other court custodian dividends
and payments which would otherwise be payable upon Guarantor Claims.  Guarantor
hereby assigns such dividends and payments to Lender.  Should Lender receive,
for application against the Guaranteed Obligations, any dividend or payment
which is otherwise payable to Guarantor and which, as between Borrower and
Guarantor, shall constitute a credit against the Guarantor Claims, then, upon
payment to Lender in full of the Obligations and the Guaranteed Obligations,
Guarantor shall become subrogated to the rights of Lender to the extent that
such payments to Lender on the Guarantor Claims have contributed toward the
liquidation of the Guaranteed Obligations, and such subrogation shall be with
respect to that proportion of the Guaranteed Obligations which would have been
unpaid if Lender had not received dividends or payments upon the Guarantor
Claims.

Section 4.3         Payments Held in Trust.    Notwithstanding anything to the
contrary contained in this Guaranty, in the event that Guarantor should receive
any funds, payments, claims and/or distributions which are prohibited by this
Guaranty, Guarantor agrees to hold in trust for Lender an amount equal to the
amount of all funds, payments, claims and/or distributions so received, and
agrees that it shall have absolutely no dominion over the amount of such funds,
payments, claims and/or distributions so received except to pay such funds,
payments, claims and/or distributions promptly to Lender, and Guarantor
covenants promptly to pay the same to Lender.

Section 4.4         Liens Subordinate.    Guarantor agrees that any liens,
security interests, judgment liens, charges or other encumbrances upon
Borrower’s assets securing payment of the Guarantor Claims shall be and remain
inferior and subordinate to any liens, security interests, judgment liens,
charges or other encumbrances upon Borrower’s assets securing payment of the
Guaranteed Obligations, regardless of whether such encumbrances in favor of
Guarantor or Lender presently exist or are hereafter created or attach.  Without
the prior written consent of Lender, Guarantor shall not (i) exercise or enforce
any creditor’s rights it may have against Borrower, or (ii) foreclose,
repossess, sequester or otherwise take steps or institute any action or
proceedings (judicial or otherwise, including, without limitation, the
commencement of, or the joinder in, any liquidation, bankruptcy, rearrangement,
debtor’s relief or insolvency proceeding) to enforce any liens, mortgages, deeds
of trust, security interests, collateral rights, judgments or other encumbrances
on the assets of Borrower held by Guarantor.  The foregoing shall in no manner
vitiate or amend, nor be deemed to vitiate or amend, any prohibition in the Loan
Documents against Borrower granting liens or security interests in any of its
assets to any Person other than Lender.

 

                                                                            

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ARTICLE 5
COVENANTS  

Section 5.1         Net Worth.    As used in this Article 5, “Net Worth” shall
have the following meaning:

            “Net Worth” shall have the meaning set forth in the Loan Agreement.

 

Section 5.2         Covenants.    Until all of the Obligations and the
Guaranteed Obligations have been paid in full, Guarantor shall maintain a Net
Worth excluding the Property of not less than $250,000,000 (the “Net Worth
Threshold”). 

Section 5.3         Financial Statements.

(a)                Guarantor shall deliver to Lender within 90 days after the
end of each fiscal year of Guarantor, a complete copy of Guarantor’s annual
financial statements audited by an Independent Accountant, prepared in
accordance with GAAP, including statements of income and expense and cash flow
and a balance sheet for Guarantor, together with a certificate of the chief
financial officer of Guarantor (A) setting forth in reasonable detail
Guarantor’s Net Worth as of the end of such prior calendar year and based on
such annual financial statements, and (B) certifying that such annual financial
statements are true, correct, accurate and complete and fairly present the
financial condition and results of the operations of such person; provided, that
notwithstanding anything in this Section 5.3(a) to the contrary, the filing of
Guarantor’s periodic reports on Form 10-Q and Form 10-K, as applicable, with the
Securities and Exchange Commission, along with a certificate of the chief
financial officer of Guarantor certifying as to Guarantor’s Net Worth as of the
end of such prior calendar year shall be deemed to satisfy this obligations of
Guarantor under this Section 5.3(a); 

(b)               Guarantor shall deliver to Lender within 45 days after the end
of each fiscal quarter of Guarantor (other than the fourth fiscal quarter),
financial statements (including a balance sheet as of the end of such fiscal
quarter and a statement of income and expense for such fiscal quarter) certified
by the chief financial officer of Guarantor and in form, content, level of
detail and scope reasonably satisfactory to Lender, together with a certificate
of the chief financial officer of Guarantor (A) setting forth in reasonable
detail Guarantor’s Net Worth as of the end of such prior calendar quarter and
based on the foregoing quarterly financial statements, and (B) certifying that
such quarterly financial statements are true, correct, accurate and complete and
fairly present the financial condition and results of the operations of
Guarantor in a manner consistent with GAAP; provided, that notwithstanding
anything in this Section 5.3(b) to the contrary, the filing of Guarantor’s
periodic reports on Form 10-Q and Form 10-K, as applicable, with the Securities
and Exchange Commission, along with a certificate of the chief financial officer
of Guarantor certifying as to Guarantor’s Net Worth as of the end of such prior
calendar year shall be deemed to satisfy this obligations of Guarantor under
this Section 5.3(b); and

(C)                GUARANTOR SHALL DELIVER TO LENDER 20 DAYS AFTER REQUEST BY
LENDER, SUCH OTHER FINANCIAL INFORMATION WITH RESPECT TO SUCH GUARANTOR AS
LENDER MAY REASONABLY REQUEST; PROVIDED, THAT FOR SO LONG AS GUARANTOR IS MAKING
FILING REGULAR PERIOD REPORTS ON FORM 10-Q AND

 

                                                                            

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FORM 10-K, AS APPLICABLE, WITH THE SECURITIES AND EXCHANGE COMMISSION, THIS
SECTION 5.4(C) SHALL NOT APPLY.

Section 5.4          Defaults:    A breach by Guarantor of the terms of this
Article 5 shall constitute a Default hereunder.

  

ARTICLE 6
MISCELLANEOUS

Section 6.1          Waiver.    No failure to exercise, and no delay in
exercising, on the part of Lender, any right hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right.  The rights of
Lender hereunder shall be in addition to all other rights provided by law.  No
modification or waiver of any provision of this Guaranty, nor any consent to any
departure therefrom, shall be effective unless in writing and no such consent or
waiver shall extend beyond the particular case and purpose involved.  No notice
or demand given in any case shall constitute a waiver of the right to take other
action in the same, similar or other instances without such notice or demand.

 

Section 6.2          Notices.    All notices, demands, requests, consents,
approvals or other communications (any of the foregoing, a “Notice”) required,
permitted or desired to be given hereunder shall be in writing and shall be sent
by telefax (with answer back acknowledged) or by registered or certified mail,
postage prepaid, return receipt requested, or delivered by hand or by reputable
overnight courier, addressed to the party to be so notified at its address
hereinafter set forth, or to such other address as such party may hereafter
specify in accordance with the provisions of this Section 6.2.  Any Notice shall
be deemed to have been received: (a) three (3) days after the date such Notice
is mailed, (b) on the date of sending by telefax if sent during business hours
on a Business Day (otherwise on the next Business Day), (c) on the date of
delivery by hand if delivered during business hours on a Business Day (otherwise
on the next Business Day), and (d) on the next Business Day if sent by an
overnight commercial courier, in each case addressed to the parties as follows:

If to Lender:                German American Capital Corporation
60 Wall Street, 10th Floor
New York, New York  10005
Attention:  Robert W. Pettinato, Jr.
Facsimile No.:  (212) 797-4489

and to:                         German American Capital Corporation
60 Wall Street, 10th Floor
New York, New York  10005
Attention:  General Counsel
Facsimile No.:  (646) 736-5721

 

                                                                             

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with a copy to:            Sidley Austin LLP     
One South Dearborn
Chicago, Illinois 60603
Attention:  Charles E. Schrank Esq.
Facsimile No.:  (312) 853-7036

If to Guarantor:           Alexander’s, Inc.
210 Route 4 East
Paramus, New Jersey 07652
Attention: Chief Financial Officer
Facsimile No.: (212) 894-7073

with a copy to:            Vornado Realty Trust

                                    888 Seventh Avenue
New York, New York 10019
Attention: Corporation Counsel

                                    Facsimile No.: (212) 894-7996

with a copy to:            Sullivan & Cromwell LLP
125 Broad Street
New York, New York  10004
Attention:  Arthur S. Adler, Esq.
Facsimile No.:  (212) 291-9001

Any party may change the address to which any such Notice is to be delivered by
furnishing ten (10) days’ written notice of such change to the other parties in
accordance with the provisions of this Section 6.2.  Notices shall be deemed to
have been given on the date set forth above, even if there is an inability to
actually deliver any Notice because of a changed address of which no Notice was
given or there is a rejection or refusal to accept any Notice offered for
delivery.  Notice for any party may be given by its respective counsel. 
Additionally, Notice from Lender may also be given by Servicer.

SECTION 6.3          GOVERNING LAW; JURISDICTION; SERVICE OF PROCESS.   
(A)  THIS GUARANTY WAS NEGOTIATED IN THE STATE OF NEW YORK, AND MADE BY
GUARANTOR AND ACCEPTED BY LENDER IN THE STATE OF NEW YORK, AND THE PROCEEDS OF
THE NOTE WERE DISBURSED FROM THE STATE OF NEW YORK, WHICH STATE THE PARTIES
AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE UNDERLYING
TRANSACTION RELATED HERETO, AND IN ALL RESPECTS, INCLUDING, WITHOUT LIMITING THE
GENERALITY OF THE FOREGOING, MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE,
THIS GUARANTY AND THE OBLIGATIONS ARISING HEREUNDER SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND PERFORMED IN SUCH STATE (WITHOUT REGARD TO PRINCIPLES OF
CONFLICT OF LAWS) AND ANY APPLICABLE LAW OF THE UNITED STATES OF AMERICA.  TO
THE FULLEST EXTENT PERMITTED BY LAW, GUARANTOR AND, BY ITS ACCEPTANCE HEREOF,
LENDER EACH

 

                                                                          

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HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT THE LAW
OF ANY OTHER JURISDICTION GOVERNS THIS GUARANTY AND/OR THE OTHER LOAN DOCUMENTS,
AND THIS GUARANTY AND THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK PURSUANT TO
SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.(b)         ANY LEGAL
SUIT, ACTION OR PROCEEDING AGAINST LENDER OR GUARANTOR ARISING OUT OF OR
RELATING TO THIS GUARANTY MAY BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE
CITY OF NEW YORK, COUNTY OF NEW YORK, PURSUANT TO SECTION 5-1402 OF THE NEW YORK
GENERAL OBLIGATIONS LAW, AND GUARANTOR AND, BY ITS ACCEPTANCE HEREOF, LENDER
EACH WAIVES ANY OBJECTIONS WHICH IT MAY NOW OR HEREAFTER HAVE BASED ON VENUE
AND/OR FORUM NON CONVENIENS OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND
GUARANTOR AND, BY ITS ACCEPTANCE HEREOF, LENDER EACH HEREBY IRREVOCABLY SUBMITS
TO THE EXCLUSIVE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR
PROCEEDING, AND GUARANTOR HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE
JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING.  GUARANTOR
DOES HEREBY AGREE DESIGNATE AND APPOINT:

VORNADO REALTY TRUST

888 SEVENTH AVENUE, 44TH FLOOR

NEW YORK, NEW YORK 10106

ATTENTION:  CORPORATION COUNSEL

FACSIMILE NO.:  (212) 894-7996

AS ITS AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY
AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING IN
ANY FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, AND GUARANTOR AGREES THAT
SERVICE OF PROCESS UPON  SAID AGENT AT SAID ADDRESS AND WRITTEN NOTICE OF SAID
SERVICE MAILED OR DELIVERED TO GUARANTOR IN THE MANNER PROVIDED HEREIN SHALL BE
DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON GUARANTOR IN ANY SUCH
SUIT, ACTION OR PROCEEDING IN THE STATE OF NEW YORK.  GUARANTOR  (I) SHALL GIVE
PROMPT NOTICE TO LENDER OF ANY CHANGE IN THE ADDRESS FOR ITS AUTHORIZED AGENT
SET FORTH HEREIN, (II) MAY AT ANY TIME AND FROM TIME TO TIME DESIGNATE A
SUBSTITUTE AUTHORIZED AGENT WITH AN OFFICE IN NEW YORK, NEW YORK (WHICH
SUBSTITUTE AGENT AND OFFICE SHALL BE DESIGNATED AS THE PERSON AND ADDRESS FOR
SERVICE OF PROCESS AND WHICH SUBSTITUTE AGENT SHALL BE THE SAME AGENT DESIGNATED
BY BORROWER UNDER THE LOAN AGREEMENT), AND (III) SHALL PROMPTLY DESIGNATE A
SUBSTITUTE AUTHORIZED AGENT IF ITS AUTHORIZED AGENT CEASES TO HAVE AN OFFICE IN
NEW YORK, NEW YORK.  NOTHING CONTAINED HEREIN SHALL AFFECT THE RIGHT OF LENDER
TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO

   

                                                                          

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COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST GUARANTOR IN ANY OTHER
JURISDICTION.

Section 6.4          Invalid Provisions.    If any provision of this Guaranty is
held to be illegal, invalid, or unenforceable under present or future laws
effective during the term of this Guaranty, such provision shall be fully
severable and this Guaranty shall be construed and enforced as if such illegal,
invalid or unenforceable provision had never comprised a part of this Guaranty,
and the remaining provisions of this Guaranty shall remain in full force and
effect and shall not be affected by the illegal, invalid or unenforceable
provision or by its severance from this Guaranty, unless such continued
effectiveness of this Guaranty, as modified, would be contrary to the basic
understandings and intentions of the parties as expressed herein.

Section 6.5          Amendments.    This Guaranty may be amended only by an
instrument in writing executed by the party(ies) against whom such amendment is
sought to be enforced.

Section 6.6          Parties Bound; Assignment.    This Guaranty shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors, permitted assigns, heirs and legal representatives. 
Lender shall have the right to assign or transfer its rights under this Guaranty
in connection with any assignment of the Loan and the Loan Documents that is
permitted under the Loan Documents.  Any permitted assignee or transferee of
Lender shall be entitled to all the benefits afforded to Lender under this
Guaranty.  Guarantor shall not have the right to assign or transfer its rights
or obligations under this Guaranty without the prior written consent of Lender,
and any attempted assignment without such consent shall be null and void.

Section 6.7          Headings.    Section headings are for convenience of
reference only and shall in no way affect the interpretation of this Guaranty.

Section 6.8          Recitals.    The recitals and introductory paragraphs
hereof are a part hereof, form a basis for this Guaranty and shall be considered
prima facie evidence of the facts and documents referred to therein.

Section 6.9          Counterparts.    To facilitate execution, this Guaranty may
be executed in as many counterparts as may be convenient or required.  It shall
not be necessary that the signature of, or on behalf of, each party, or that the
signature of all persons required to bind any party, appear on each
counterpart.  All counterparts shall collectively constitute a single
instrument.  It shall not be necessary in making proof of this Guaranty to
produce or account for more than a single counterpart containing the respective
signatures of, or on behalf of, each of the parties hereto.  Any signature page
to any counterpart may be detached from such counterpart without impairing the
legal effect of the signatures thereon and thereafter attached to another
counterpart identical thereto except having attached to it additional signature
pages.

Section 6.10        Rights and Remedies.    If Guarantor becomes liable for any
indebtedness owing by Borrower to Lender, by endorsement or otherwise, other
than under this Guaranty, such liability shall not be in any manner impaired or
affected hereby and the rights of Lender hereunder shall be cumulative of any
and all other rights that Lender may ever have against Guarantor.  The exercise
by Lender of any right or remedy hereunder or under any other

 

                                                                           

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instrument, or at law or in equity, shall not preclude the concurrent or
subsequent exercise of any other right or remedy.

SECTION 6.11        ENTIRETY.    THIS GUARANTY EMBODIES THE FINAL, ENTIRE
AGREEMENT OF GUARANTOR AND LENDER WITH RESPECT TO GUARANTOR’S GUARANTY OF THE
GUARANTEED OBLIGATIONS AND SUPERSEDES ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS,
REPRESENTATIONS AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THE
SUBJECT MATTER HEREOF.  THIS GUARANTY IS INTENDED BY GUARANTOR AND LENDER AS A
FINAL AND COMPLETE EXPRESSION OF THE TERMS OF THE GUARANTY, AND NO COURSE OF
DEALING BETWEEN GUARANTOR AND LENDER, NO COURSE OF PERFORMANCE, NO TRADE
PRACTICES AND NO EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OR DISCUSSIONS OR OTHER EXTRINSIC EVIDENCE OF ANY NATURE SHALL BE
USED TO CONTRADICT, VARY, SUPPLEMENT OR MODIFY ANY TERM OF THIS GUARANTY.  THERE
ARE NO ORAL AGREEMENTS BETWEEN GUARANTOR AND LENDER.

SECTION 6.12        WAIVER OF RIGHT TO TRIAL BY JURY.     GUARANTOR AND, BY ITS
ACCEPTANCE HEREOF, LENDER EACH HEREBY AGREES NOT TO ELECT A TRIAL BY JURY OF ANY
ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVES ANY RIGHT TO TRIAL BY JURY FULLY TO
THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST WITH REGARD TO THIS
GUARANTY, THE NOTE, THE MORTGAGE, THE LOAN AGREEMENT OR THE OTHER LOAN
DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR OTHER ACTION ARISING IN CONNECTION
THEREWITH.  THIS WAIVER OF RIGHT TO TRIAL BY JURY IS GIVEN KNOWINGLY AND
VOLUNTARILY BY GUARANTOR AND LENDER AND IS INTENDED TO ENCOMPASS INDIVIDUALLY
EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY JURY WOULD
OTHERWISE ACCRUE.  LENDER AND GUARANTOR ARE EACH HEREBY AUTHORIZED TO FILE A
COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER
BY LENDER AND GUARANTOR, RESPECTIVELY.

Section  6.13         Intentionally Omitted. 

Section 6.14        Reinstatement in Certain Circumstances.    If at any time
any payment of the principal of or interest under the Note or any other amount
payable by Borrower under the Loan Documents is rescinded or must be otherwise
restored or returned upon the insolvency, bankruptcy or reorganization of the
Borrower or otherwise, Guarantor’s obligations hereunder with respect to such
payment shall be reinstated as though such payment had been due but not made at
such time.

Section 6.15        Gender; Number; General Definitions.    Unless the context
clearly indicates a contrary intent or unless otherwise specifically provided
herein, (a) words used in this Guaranty may be used interchangeably in the
singular or plural form, (b) any pronouns used herein shall include the
corresponding masculine, feminine or neuter forms, (c) the word

 

                                                                           

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“Borrower” shall mean “each Borrower and any subsequent owner or owners of the
Property or any part thereof or interest therein”, (d) the word “Lender” shall
mean “Lender and any subsequent holder of the Note”, (e) the word “Note” shall
mean “the Note and any other evidence of indebtedness secured by the Loan
Agreement”, (f) the word “Property” shall include any portion of the Property
and any interest therein, and (g) the phrases “attorneys’ fees”, “legal fees”
and “counsel fees” shall include any and all attorneys’, paralegal and law clerk
fees and disbursements, including, but not limited to, fees and disbursements at
the pre-trial, trial and appellate levels, incurred or paid by Lender in
protecting its interest in the Property, the Leases and/or the Rents and/or in
enforcing its rights hereunder.

Section 6.16        Limitation of Liability.    By accepting this Guaranty,
Lender hereby waives and releases all liability, and no liability shall be
enforceable, against the separate constituent owners of Guarantor or the assets
of such constituent owners in respect of Guarantor’s obligations under this
Guaranty.  The foregoing waiver and release are part of the consideration for
the execution and delivery of this Guaranty.

 

 

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IN WITNESS WHEREOF, Guarantor has executed this Guaranty as of the day and year
first above written.

GUARANTOR: 

ALEXANDER’S INC., a Delaware corporation

 

By:      /s/ Alan J. Rice                   e 
            Name: Alan J. Rice
            Title: Secretary

 

 

 

 

 

 

 

 

 

 

 

731 Lexington- Guaranty of Recourse Obligations