Exhibit 10.3

 

WMLM

Execution Copy

 

CARVEOUT GUARANTY

 

THIS CARVEOUT GUARANTY (this “Guaranty”) is made as of February 9, 2015, by
Trinity place holdings inc., a Delaware corporation having an address at 717
Fifth Avenue, New York, New York 10022 (the “Guarantor”) for the benefit of
STERLING NATIONAL BANK, having a place of business at 400 Rella Boulevard,
Montebello, New York 10901, in its capacity as Administrative Agent (in such
capacity, the “Administrative Agent”) for the ratable benefit of the Lenders
specified in the Term Loan Agreement described below.

 

W I T N E S S E T H:

 

WHEREAS, concurrently herewith TPHGREENWICH OWNER LLC, a Delaware limited
liability company (the “Borrower”), the Lenders named therein and the
Administrative Agent are entering into a Term Loan Agreement of even date
herewith (as it may be amended, restated, supplemented or modified from time to
time, herein called the “Loan Agreement”), providing, among other things, for
first mortgage loans to be made by the Lenders to the Borrower in the initial
aggregate principal amount of $40,000,000, which amount may be increased to
$50,000,000 on the terms and subject to the conditions set forth in the Loan
Agreement (such loans will be referred to herein collectively as the “Loans” and
individually as a “Loan”) to be evidenced by promissory notes of even date
herewith (each, a “Note” and, collectively, the “Notes”), and secured by, among
other things, (i) a mortgage of even date herewith (the “Mortgage”), encumbering
certain land and improvements located at 38-42 Trinity Place and 67 Greenwich
Street, New York, New York 10006 (collectively the “Property”), as more fully
described in the Mortgage, and (ii) various other documents executed in
connection with the Loan Agreement, the Notes and the Mortgage (the Loan
Agreement, the Notes, the Mortgage, and any other instruments, documents or
agreements executed in connection therewith, as the same may be amended,
restated, supplemented or modified from time to time, are hereinafter
collectively referred to as the “Loan Documents” and each as a “Loan Document”);
and

 

WHEREAS, Guarantor is the direct, legal and beneficial owner of 100% of the
equity interests in Borrower, and Guarantor will directly or indirectly and
substantially benefit from the Lenders making the Loans to Borrower.

 

NOW, THEREFORE, as an inducement to the Lenders to make the Loans to Borrower
and to the Administrative Agent to act as such under the Loan Agreement, 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 I
DEFINITIONS

 

1.1                Definitions. All capitalized terms that are defined in the
Loan Agreement and are not otherwise defined herein shall have the respective
meanings assigned to them in the Loan Agreement and, in addition, the following
terms shall have the following meanings:

 

(a)                 “Carveout Obligations” means all actual losses incurred by
Administrative Agent or any Lender (such losses to include, without limitation,
the failure to recover any or all Loan Obligations but excluding punitive
damages) resulting from any of the following:

 

(i)                   any fraud or intentional misrepresentation by any Loan
Party in connection with the Loans;

 

(ii)                 the misapplication in violation of the Loan Documents by
Borrower or any of its Affiliates of any (1) insurance proceeds paid to Borrower
or any of its affiliates by reason of any loss, damage or destruction to the
Property, (2) awards or other amounts received by Borrower or any of its
Affiliates in connection with the condemnation of all or a portion of the
Property, (3) any Rents following an Event of Default, or (4) any funds that are
to be disbursed into or from any accounts or lockbox established under the Loan
Documents;

 

 

 

  

(iii)                use of any Loan proceeds in violation of Section 2.6 of the
Loan Agreement;

 

(iv)               physical waste of any portion of the Property resulting from
intentional or fraudulent acts or omissions by Borrower or any of its Affiliates
(other than physical waste resulting from insufficient cash flow from the
Property);

 

(v)                 intentional failure by Borrower or any of its Affiliates to
comply with any legal requirements of any Governmental Authority (other than a
failure resulting from the non-payment of money) resulting in a forfeiture by
Borrower of the Property, or any material portion thereof; or

 

(vi)               any action or failure to act on the part of Borrower that
causes it to cease to be a single purpose entity in accordance with Section 6.3
of the Loan Agreement; or

 

(vii)              the commencement by the Borrower or Holdings (as debtor) of
any voluntary proceeding under the Bankruptcy Code or any other insolvency,
bankruptcy, arrangement, reorganization, liquidation, dissolution or similar law
of the United States or any other jurisdiction.

 

(b)                 “Guaranteed Obligations” means the Maintenance Obligations
and the Carveout Obligations.

 

(c)                 “Guarantor Claims” shall have the meaning set forth in
Section 5.1 of this Guaranty.

 

(d)                 “herein,” “hereof,” “hereunder,” and “herewith” shall be
deemed to refer to this entire Guaranty and not any particular provision of this
Guaranty.

 

(e)                 “Including” or “including” means “including, without
limitation.”

 

(f)                  “Leases” means all leases, licenses, concessions, occupancy
agreements, and other agreements affecting the use or occupancy of the Property
or any portion thereof, now or hereafter entered into and all guarantees of any
of the foregoing.

 

(g)                 “Loan Obligations” means the Obligations, as such term is
defined in the Loan Agreement.

 

(h)                 “Maintenance Obligations” means the obligation by Borrower
to pay the following in full when due:

 

(i)                   all costs necessary to maintain the Property in good
condition and repair to the extent required in order to comply with all
applicable Laws;

 

(ii)                 all insurance premiums under policies maintained by
Borrower and covering the Property (except to the extent that Borrower has
deposited funds therefor with Administrative Agent); and

 

(iii)                all real estate taxes payable with respect to the Property
(except to the extent that Borrower has deposited funds therefor with
Administrative Agent).

 

(i)                   “Rents” means all rents, issues and profits of the
Property or any part thereof.

 

 

 

 

ARTICLE II
NATURE AND SCOPE OF GUARANTY

 

2.1                Guaranty of Certain Obligations. Subject to the terms hereof,
effective immediately on the date hereof (and without any notice or further act
or condition of any kind), Guarantor hereby irrevocably and unconditionally
agrees that it shall be liable to the Administrative Agent for the ratable
benefit of the Lenders (and their respective successors and permitted assigns)
for the payment in full when due of all Guaranteed Obligations. Guarantor hereby
irrevocably and unconditionally covenants and agrees that it is liable for the
Guaranteed Obligations as a primary obligor and not merely as a surety.

 

2.2                Nature of Guaranty. This Guaranty is an irrevocable,
absolute, continuing guaranty of payment, and is 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 Guarantor’s liquidation and
dissolution (and in any such event, this Guaranty shall be binding upon
Guarantor’s successors and assigns). The fact that, at any time, or from time to
time, the Loan Obligations or the Guaranteed Obligations may be increased or
reduced, shall not release or discharge the obligation of Guarantor to the
Administrative Agent for the ratable benefit of Lenders with respect to the
Guaranteed Obligations. This Guaranty may be enforced by the Administrative
Agent, and shall not be discharged by the assignment or negotiation of all or
part of any Note. This Guaranty shall survive any reinstatement of the Loan
Obligations or any portion thereof.

 

2.3                Guaranteed Obligations Not Reduced by Offset. The Guaranteed
Obligations, and the liabilities and obligations of Guarantor to Administrative
Agent and Lenders 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 Person against Administrative Agent or any Lender or
against payment of any Loan Obligations or Guaranteed Obligations, whether such
offset, claim or defense arises in connection with the Loan Obligations or the
Guaranteed Obligations (or the transactions creating any Loan Obligations or
Guaranteed Obligations) or otherwise (other than, in any such case, the defense
of payment of the Guaranteed Obligation in question).

 

2.4                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, upon demand by Administrative Agent
and 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, pay in lawful money of the United
States of America, the amount then due on the Guaranteed Obligations, to
Administrative Agent’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 pursuant to the terms of the Loan Documents. Such demand
shall be deemed made, given and received in accordance with the notice
provisions hereof.

 

2.5                No Duty to Accelerate or Pursue Others. It shall not be
necessary for Administrative Agent (and Guarantor hereby waives any rights which
Guarantor may have to require Administrative Agent), in order to enforce the
obligations of Guarantor hereunder, first to (a) accelerate the Loan Obligations
or the Guaranteed Obligations or take any other action or exercise any remedy
available to it under any Loan Document or by operation of Law, (b) provide any
notice to or make any demand upon any Person other than the Guarantor, (c)
institute suit or exhaust its remedies against Borrower or others liable on the
Loan Obligations or the Guaranteed Obligations or any other Person, (d) enforce
Administrative Agent’s or Lenders’ rights against any collateral which shall
ever have been given to secure the Loan Obligations or the Guaranteed
Obligations, (e) enforce Administrative Agent’s or Lenders’ rights against any
other guarantors of the Loan Obligations or the Guaranteed Obligations, (f) join
Borrower or any other Person liable on the Loan Obligations or the Guaranteed
Obligations in any action seeking to enforce this Guaranty, (g) exhaust any
remedies available to Administrative Agent or any Lender against any collateral
which shall ever have been given to secure the Loan Obligations or the
Guaranteed Obligations, or (h) resort to any other means of obtaining payment of
the Loan Obligations or the Guaranteed Obligations. Neither Administrative Agent
nor any Lender shall be required to mitigate damages or take any other action to
reduce, collect or enforce the Loan Obligations or the Guaranteed Obligations.

 

2.6                Waivers. Guarantor acknowledges having reviewed the
provisions of the Loan Documents, and hereby waives notice of (i) any loans or
advances made by any Lender to Borrower, (ii) acceptance of this Guaranty, (iii)
any amendment, extension, increase, waiver, consent or other modification of the
Loan Agreement, Mortgage, or any other Loan Documents, (iv) the execution and
delivery by Borrower, Administrative Agent or any Lender of any other loan or
credit agreement or of Borrower’s execution and delivery of any promissory notes
or other documents arising under the Loan Documents or in connection with the
Loan Obligations or the Guaranteed Obligations, (v) the occurrence of any Event
of Default, (vi) any Lender’s transfer or disposition of its share of the Loan
Obligations or the Guaranteed Obligations, or any part thereof, (vii) sale or
foreclosure (or posting or advertising for sale or foreclosure) of any
collateral for the Loan Obligations or the Guaranteed Obligations, (viii)
protest, proof of nonpayment or default by Borrower, or (ix) except to the
extent expressly required by the terms hereof or the Loan Agreement, all demands
and notices of every kind in connection with this Guaranty or the Loan
Documents.

 

 

 

  

2.7                Payment of Expenses. In the event that Guarantor should
breach or fail to timely perform any provisions of this Guaranty, Guarantor
shall, within 5 days following demand by Administrative Agent, pay
Administrative Agent all out of pocket costs and expenses (including court costs
and reasonable attorneys’ fees and disbursements) incurred by Administrative
Agent or any Lender in the enforcement hereof or the preservation of
Administrative Agent’s or Lenders’ rights hereunder. All costs and expenses will
accrue interest at the highest default rate in any instrument evidencing the
Loan Obligations until payment is actually received by the Administrative Agent.
Subject to Section 7.14 hereof, the covenant contained in this Section shall
survive the payment and performance of the Guaranteed Obligations.

 

2.8                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, Administrative Agent or any
Lender must rescind or restore any payment or any part thereof received by
Administrative Agent or such Lender in satisfaction of the Loan Obligations or
the Guaranteed Obligations, as set forth herein, then any prior release or
discharge from the terms of this Guaranty, or credit, given to Guarantor by
Administrative Agent or any Lender shall be without effect and this Guaranty
shall be restored and remain in full force and effect to the extent of such
payment so restored. It is the intention of Borrower and Guarantor that, subject
to Section 7.14 hereof, the Guarantor’s obligations hereunder shall not be
discharged except by Borrower’s indefeasible payment in full of the Guaranteed
Obligations, that in the event of any such rescission or restoration by
Administrative Agent or any Lender with respect to any payment as provided above
in this paragraph, then to the extent of such rescission or restoration the
Guaranteed Obligations shall also be restored and shall remain in effect.

 

2.9                Waiver of Subrogation, Reimbursement and Contribution.
Notwithstanding anything to the contrary contained in this Guaranty, Guarantor
hereby unconditionally and irrevocably defers, until the indefeasible payment in
full of the Loan Obligations, 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 Administrative Agent or any Lender), to
assert any claim against or seek contribution, indemnification or any other form
of reimbursement from Borrower, or any other Person liable for payment of any or
all of the Guaranteed Obligations, for any payment made by Guarantor under or in
connection with this Guaranty.

 

2.10            Borrower. The term “Borrower” as used herein shall include any
new or successor corporation, association, partnership (general or limited),
limited liability company, joint venture, trust or other individual or
organization formed as a result of any merger, reorganization, sale or transfer
of Borrower or any interest in Borrower.

 

2.11            Other Guaranties. This Guaranty is separate, distinct and in
addition to any liability or obligations that Borrower or any other guarantor
may have under any other guaranty or indemnity executed by Borrower or such
other guarantor in connection with the Loan Obligations.

 

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

 

Guarantor hereby (i) 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,
except to the extent expressly required by the terms hereof, and (ii) waives any
common law, equitable, statutory or other rights (including without limitation,
except to the extent required by the terms hereof, rights to notice) which
Guarantor might otherwise have as a result of or in connection with any of the
following:

 

 

 

  

3.1                Modifications. Subject to Section 7.5 hereof, any amendment,
renewal, extension, increase, modification, alteration or rearrangement of all
or any part of the Loan Obligations, the Loan Agreement, the Mortgage, or any
other Loan Documents or any other document, instrument, contract or
understanding between Borrower and Administrative Agent or any Lender or any
other Person pertaining to the Loan Obligations or the Guaranteed Obligations,
or any failure of Administrative Agent to notify Guarantor of any such action.

 

3.2                Adjustment. Any adjustment, indulgence, forbearance or
compromise that might be granted or given by Administrative Agent or any Lender
to Borrower.

 

3.3                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 Loan Obligations or the
Guaranteed Obligations; or any death or 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 shareholders, partners or members of Borrower or
Guarantor; or any reorganization of Borrower or Guarantor.

 

3.4                Invalidity of Guaranteed Obligations. The invalidity,
illegality or unenforceability against Borrower or any other Person at any time
liable for the payment of all or part of the Loan Obligations or the Guaranteed
Obligations or any document or agreement executed in connection with the Loan
Obligations or the Guaranteed Obligations for any reason whatsoever, including,
without limitation, the fact that (a) the Loan Obligations or the Guaranteed
Obligations or any part thereof exceeds the amount permitted by law, (b) the act
of creating the Loan Obligations or the Guaranteed Obligations or any part
thereof is ultra vires, (c) the officers or representatives executing the Loan
Agreement, the Mortgage, or any other Loan Documents or otherwise creating the
Loan Obligations or the Guaranteed Obligations acted in excess of their
authority, (d) the Loan Obligations or the Guaranteed Obligations violate
applicable usury laws, (e) Borrower or any other Person at any time liable for
the payment of all or part of the Loan Obligations or the Guaranteed Obligations
has valid defenses (other than payment), claims or offsets (whether at law, in
equity or by agreement) which render the Loan Obligations or the Guaranteed
Obligations wholly or partially unenforceable against or uncollectible from
Borrower or any other Person at any time liable for the payment of all or part
of the Loan Obligations or the Guaranteed Obligations, (f) the creation,
performance or repayment of the Loan Obligations or the Guaranteed Obligations
(or the execution, delivery and performance of any document or instrument
representing part of the Loan Obligations or the Guaranteed Obligations or
executed in connection with the Loan Obligations or the Guaranteed Obligations
or given to secure the repayment of the Loan Obligations or the Guaranteed
Obligations) is illegal, uncollectible or unenforceable, or (g) the Loan
Agreement, the Mortgage 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 Loan Obligations or the Guaranteed Obligations
or any part thereof for any reason (other than by reason of payment in full
thereof).

 

3.5                Release of Obligors. Any full or partial release of the
liability of Borrower on the Loan Obligations or the Guaranteed Obligations or
any part thereof, or of any co-guarantors, or 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 Loan
Obligations or 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 of 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 any other
Person will be liable to pay or perform the Loan Obligations or the Guaranteed
Obligations, or that Administrative Agent or any Lender will look to any other
Person to pay or perform any of the Loan Obligations or the Guaranteed
Obligations.

 

3.6                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 Loan Obligations or the Guaranteed Obligations.

 

3.7                Release of Collateral. Any release, surrender, exchange,
subordination, deterioration, waste, loss or impairment (including without
limitation negligent, willful, unreasonable or unjustifiable impairment) by any
Person 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 Loan
Obligations or the Guaranteed Obligations.

 

 

 

  

3.8                Care and Diligence. The failure of Administrative Agent, any
Lender or any other Person 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 any neglect, delay, omission, failure or refusal of Administrative
Agent or any Lender (a) to take or prosecute any action for the collection of
any of the Loan Obligations or the Guaranteed Obligations, (b) to foreclose, or
initiate any action to foreclose, or, once commenced, prosecute to completion
any action to foreclose upon any security therefor, or (c) to take or prosecute
any action in connection with any instrument or agreement evidencing or securing
all or any part of the Loan Obligations or the Guaranteed Obligations.

 

3.9                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 Loan Obligations or 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, as between Administrative Agent, Lenders
and 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 Loan Obligations or the
Guaranteed Obligations.

 

3.10            Offset. Any existing or future right of offset, claim or defense
of Borrower against Administrative Agent or any Lender, or any other Person, or
against payment of the Loan Obligations or the Guaranteed Obligations, whether
such right of offset, claim or defense arises in connection with the Loan
Obligations or the Guaranteed Obligations (other than the indefeasible payment
in full of the Guaranteed Obligations) or the transactions creating the Loan
Obligations and the Guaranteed Obligations.

 

3.11            Merger. The reorganization, merger or consolidation of Borrower
into or with any other Person.

 

3.12            Preference. Any payment by Borrower to Administrative Agent or
any Lender that is returned, recovered or otherwise paid, in whole or in part,
in settlement of a suit, claim or other demand seeking avoidance and recovery of
such payment as a preference or fraudulent conveyance under bankruptcy laws or
applicable state law, or if for any reason Administrative Agent or any Lender is
required to refund such payment or pay such amount to Borrower or any other
Person.

 

3.13            Other Actions Taken or Omitted. Any other action taken or
omitted to be taken with respect to the Loan Documents, the Loan Obligations,
the Guaranteed Obligations, or the security and collateral therefor, 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; and it is 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, which obligation shall be deemed
satisfied only upon the indefeasible payment in full of the Guaranteed
Obligations.

 

ARTICLE IV
REPRESENTATIONS AND WARRANTIES

 

To induce Administrative Agent and Lenders to enter into the Loan Agreement, the
Mortgage and the other Loan Documents, and extend and maintain credit to
Borrower, Guarantor represents and warrants as of the date hereof to
Administrative Agent for the benefit of the Lenders as follows:

 

4.1                Benefit. Guarantor is an Affiliate of Borrower, and is the
direct legal and beneficial owner of 100% of the equity interests in Borrower,
and has received, or will receive, direct or indirect and substantial benefit
from the Loan.

 

4.2                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 Loan Obligations and the
Guaranteed Obligations; however, as between Administrative Agent, Lenders and
Guarantor, Guarantor is not relying on such information, or the financial
condition of Borrower, the collateral or any other condition, as an inducement
to enter into this Guaranty.

 

 

 

  

4.3                No Representation by Administrative Agent or Lenders. Neither
Administrative Agent nor any Lender, nor any other Person on behalf of
Administrative Agent or any Lender, has made any representation, warranty or
statement to Guarantor in order to induce Guarantor to execute this Guaranty.

 

4.4                Guarantor’s Financial Condition. As of the date hereof, and
after giving effect to this Guaranty and the contingent obligation evidenced
hereby, Guarantor is solvent and has assets which, fairly valued, exceed its
obligations, liabilities (including contingent liabilities fairly estimated) and
debts, and has property and assets sufficient to satisfy and repay its
obligations and liabilities, as and when the same become due.

 

4.5                Legality; Due Authorization; Enforceability. 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 under or result in the breach of, any
indenture, mortgage, charge, lien, or any 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 in accordance with its terms, except as limited by bankruptcy,
insolvency or other laws of general application relating to the enforcement of
creditors’ rights and subject, as to enforceability, to general principals of
equity regardless of whether enforcement is sought in a proceeding in equity or
at law.

 

4.6                Litigation. There are no actions, suits or proceedings at law
or in equity by or before any Governmental Authority or other agency now pending
or, to Guarantor’s knowledge, threatened, against or affecting Guarantor which
would reasonably be expected to materially adversely affect the ability of
Guarantor to perform its obligations under this Guaranty.

 

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

 

ARTICLE V
SUBORDINATION OF CERTAIN INDEBTEDNESS

 

5.1                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, or 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 any Person in whose
favor such debts or liabilities may, at their inception, have been, or may
hereafter be, created, or the manner in 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. After the occurrence and during the existence of
an Event of Default, or the occurrence of an event which would, with the giving
of notice or the passage of time, or both, constitute an Event of Default,
Guarantor shall not receive or collect, directly or indirectly, from Borrower or
any other Person, any amount upon the Guarantor Claims, until the indefeasible
payment in full of the Loan Obligations and the Guaranteed Obligations.

 

5.2                Claims in Bankruptcy. In the event of receivership,
bankruptcy, reorganization, arrangement, debtor’s relief, or other insolvency
proceedings involving Borrower as debtor, Administrative Agent and Lenders shall
have the right to prove their respective claims 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 Administrative Agent for the benefit of the Lenders to the extent of
the Guaranteed Obligations. Should Administrative Agent 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 the indefeasible
payment and performance in full to Administrative Agent and Lenders of the Loan
Obligations and the Guaranteed Obligations, Guarantor shall become subrogated to
the rights of Administrative Agent and Lenders to the extent that such payments
to Administrative Agent 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 Administrative Agent had not received dividends or payments upon the
Guarantor Claims.

 

 

 

  

5.3                Payments Held in Trust. In the event that, notwithstanding
anything to the contrary in this Guaranty, Guarantor should receive any funds,
payment, claim or distribution which is prohibited by this Guaranty, then
Guarantor agrees to hold in trust for Administrative Agent an amount equal to
the amount of all funds, payments, claims or distributions so received (but only
to the extent of the Guaranteed Obligations), and Guarantor further agrees that
it shall have absolutely no dominion over (or equitable or beneficial ownership
of) the amount of such funds, payments, claims or distributions so received, and
Guarantor covenants promptly to pay the same to Administrative Agent.

 

5.4                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 Loan Obligations and
the Guaranteed Obligations, regardless of whether such liens, security
interests, judgment liens, charges or other encumbrances in favor of Guarantor
or Administrative Agent presently exist or are hereafter created or attach.
Without the prior written consent of Administrative Agent, Guarantor shall not
(i) exercise or enforce any right it may have against Borrower, or (ii)
foreclose, repossess, sequester, or otherwise take steps, or institute any
action or proceeding (judicial or otherwise, including, without limitation, the
commencement of, or 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 assets of Borrower securing payment of the Guarantor Claims held
by Guarantor.

 

ARTICLE VI
COVENANTS

 

6.1                Financial Information. The Guarantor hereby represents and
warrants, as of the date hereof, that all financial statements of the Guarantor
heretofore delivered to the Administrative Agent by or on behalf of the
Guarantor are true and correct in all material respects and fairly present the
financial condition of the Guarantor as of the respective dates of such
financial statements. No material adverse change has occurred in any financial
condition reflected in any such financial statement since the date of such
financial statement. In addition, the Guarantor covenants that so long as the
Loan Obligations remain outstanding and unpaid, the Guarantor will, or will
cause the Borrower to, furnish to the Administrative Agent, unless otherwise
consented to in writing by the Administrative Agent, all of the financial
statements of the Guarantor specified in Section 5.3 of the Loan Agreement.

 

ARTICLE VII
MISCELLANEOUS

 

7.1                Waiver. No failure to exercise, and no delay in exercising,
on the part of Administrative Agent or any 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 Administrative Agent 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 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 except to the extent such a notice or demand is
required by the terms hereof.

 

7.2                Notices. All notices, consents, approvals and requests
required or permitted hereunder shall be in writing, and shall be either hand
delivered or sent, by (a) certified or registered U.S. mail, Return Receipt
Requested, first class postage prepaid, or (b) expedited prepaid delivery
service, either commercial (e.g., Federal Express or comparable national
courier) or U.S. Postal Service, with proof of attempted delivery. All notices
to any party shall be addressed to such party at its following address:

 

 

 

  

If to the Administrative Agent:

Sterling National Bank

400 Rella Blvd., P.O. Box 600

Montebello, New York 10901

Attention: Commercial Loan Department

 

With a copy to:

Windels Marx Lane & Mittendorf, LLP

156 West 56th Street

New York, New York 10019

Attn: Michael Clain, Esq.

 

If to the Guarantor:

Trinity Place Holdings Inc.

717 Fifth Avenue

New York, New York 10022

Attn: Mr. Matthew Messinger

 

With a copy to:

Kramer Levin Naftalis & Frankel LLP

1177 Avenue of the Americas

New York, New York 10036

Attn: James P. Godman, Esq.

 

Any party may give notice, in the manner permitted by this Section, designating
a new address in the United States for all notices to such party pursuant to
this Section, and such notice shall become effective upon receipt of such notice
by the other party or parties to this Guaranty.

 

7.3                Governing Law; Submission to Jurisdiction. THIS GUARANTY
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE SUBSTANTIVE LAWS OF
THE STATE OF NEW YORK AND THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST ADMINISTRATIVE AGENT OR GUARANTOR
ARISING OUT OF OR RELATING TO THIS GUARANTY MAY BE INSTITUTED IN ANY FEDERAL OR
STATE COURT IN NEW YORK COUNTY, NEW YORK, AND ADMINISTRATIVE AGENT, LENDERS (BY
THEIR ACCEPTANCE HEREOF) AND GUARANTOR WAIVE ANY OBJECTIONS WHICH THEY MAY NOW
OR HEREAFTER HAVE BASED ON VENUE AND/OR FORUM NON CONVENIENS OF ANY SUCH SUIT,
ACTION OR PROCEEDING, AND ADMINISTRATIVE AGENT, LENDERS (BY THEIR ACCEPTANCE
HEREOF) AND GUARANTOR HEREBY IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF
ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING. FURTHERMORE, THE GUARANTOR
AGREES AND CONSENTS THAT, IN ADDITION TO ANY METHODS OF SERVICE OF PROCESS
PROVIDED FOR UNDER APPLICABLE LAW, ALL SERVICE OF PROCESS IN ANY SUCH SUIT,
ACTION OR PROCEEDING REFERRED TO ABOVE MAY BE MADE BY CERTIFIED OR REGISTERED
MAIL, POSTAGE PREPAID, RETURN RECEIPT REQUESTED, DIRECTED TO GUARANTOR AT THE
ADDRESS INDICATED IN THIS GUARANTY FOR SUCH PARTY.

 

7.4                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, then 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.

 

7.5                Amendments and Waivers. No term or provision of this Guaranty
may be amended, waived or otherwise modified except pursuant an instrument in
writing executed by the party (or an authorized representative of the party)
against whom enforcement of such amendment, waiver or modification is sought.

 

 

 

  

7.6                Parties Bound; Assignment; Joint and Several. This Guaranty
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors, permitted assigns and legal representatives; provided,
however, that Guarantor may not, without the prior written consent of
Administrative Agent, assign any of its rights, powers, duties or obligations
hereunder.

 

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

 

7.8                Consideration. Guarantor is the direct, legal and beneficial
owner of 100% of the direct equity interests in Borrower and will substantially
benefit from the Loans made by Lenders to Borrower pursuant to the Loan
Agreement.

 

7.9                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.

 

7.10            Rights and Remedies. If Guarantor becomes liable for any
indebtedness owing by Borrower to Administrative Agent or any Lender, by
endorsement or otherwise, other than under this Guaranty, then such liability
shall not be in any manner impaired or affected hereby, and the rights of
Administrative Agent and Lenders hereunder shall be cumulative of any and all
other rights that Administrative Agent and Lenders may ever have against
Guarantor. The exercise by Administrative Agent or any Lender of any right or
remedy hereunder or under any other instrument, or at law or in equity, shall
not preclude the concurrent or subsequent exercise of any other right or remedy.

 

7.11            Entirety. THIS GUARANTY EMBODIES THE FINAL, ENTIRE AGREEMENT OF
GUARANTOR AND ADMINISTRATIVE AGENT 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, EXCEPT AS PROVIDED IN THE LOAN DOCUMENTS. THIS GUARANTY
IS INTENDED BY GUARANTOR AND ADMINISTRATIVE AGENT AS A FINAL AND COMPLETE
EXPRESSION OF THE TERMS OF THE GUARANTY, AND NO COURSE OF DEALING BETWEEN
GUARANTOR AND ADMINISTRATIVE AGENT, 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
AGREEMENT. THERE ARE NO ORAL AGREEMENTS BETWEEN GUARANTOR AND ADMINISTRATIVE
AGENT OR ANY LENDER RELATING TO THE GUARANTEED OBLIGATIONS.

 

7.12            Waiver of Right To Trial By Jury. GUARANTOR, AND BY THEIR
ACCEPTANCE HEREOF, ADMINISTRATIVE AGENT AND LENDERS, AGREE 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 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 EACH OF ADMINISTRATIVE AGENT, LENDERS AND GUARANTOR, AND IS
INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE
RIGHT TO A TRIAL BY JURY WOULD OTHERWISE ACCRUE. EACH PARTY IS HEREBY AUTHORIZED
TO FILE A COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF
THIS WAIVER.

 

7.13            No Third Party Beneficiaries. This Guaranty is solely between
the Guarantor and the Administrative Agent, and solely for the benefit of the
Administrative Agent, the Lenders and any subsequent holder or holders of any
Note, and nothing in this Guaranty, whether express or implied, shall be
construed to give any other Person any legal or equitable right, remedy or claim
under or in respect of this Guaranty.

 

 

 

  

7.14            Release of Maintenance Obligation on Cutoff Date. Guarantor
shall have no obligations with respect to Maintenance Obligations first
occurring after the earlier to occur of (x) the first anniversary of the date,
if any, on which Administrative Agent (or its designee) takes title to the
Property by foreclosure, deed-in-lieu of foreclosure or otherwise or (y) the
first anniversary of the date, if any, on which Borrower tenders a deed to the
Property to Administrative Agent (or its designee)(the earlier of the forgoing
dates, the “Cut-Off Date”), and the term “Guaranteed Obligations” shall be
deemed to exclude any Maintenance Obligations first occurring after the Cut-off
Date, notwithstanding anything to the contrary contained in this Guaranty;
provided that with respect to a tender of a deed that is not accepted by
Administrative Agent (or its designee), the Cut-Off Date shall not be deemed to
occur until Borrower and Guarantor, at their sole cost and expense, shall have
furnished to Administrative Agent a Phase I environmental assessment of the
Property (i) conducted by an environmental engineer or consultant reasonably
acceptable to Administrative Agent (but who shall in no event have less than ten
(10) years’ experience in conducting similar assessments on properties in the
general geographical location of the Property); (ii) covering such subjects as
are addressed in the Environmental Report and (iii) that concludes, in the
Administrative Agent’s reasonable discretion, that the Property does not contain
any Hazardous Substances in violation of applicable law.

 

 

 

 

[Balance of page intentionally left blank; signature page follows]

  

 

 

 

IN WITNESS WHEREOF, the Guarantor has executed this Guaranty as of the date
above set forth.

 

    TRINITY PLACE HOLDINGS INC.,     a Delaware corporation                  
By: /s/ RICHARD PYONTEK       Name: Richard Pyontek       Title:   Chief
Financial Officer  

 

ACKNOWLEDGMENT(S)

 

STATE OF NEW YORK      )

 ) SS:

COUNTY OF NEW YORK )

 

On the 5th day of February, 2015 before me, the undersigned, a notary public in
and for said state, personally appeared RICHARD PYONTEK personally known to me
or proved to me on the basis of satisfactory evidence to be the individual whose
names) is (are) subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their capacity(ies), and that by
his/her/their signatures) on the instrument, the individual(s), or the person
upon behalf of which the individual(s) acted, executed the instrument.

 

  /s/ STEPHANIE TUMSUDEN   Notary Public       STEPHANIE LYNN TUMSUDEN   NOTARY
PUBLIC – STATE OF NEW YORK   No. 01TU6252488   Qualified in Suffolk County   My
Commission Expires December 05, 2015

 

 

 

 

 

 

 

 

 

 

[Signature page to Carveout Guaranty]