Document:

KBS SOR II Q4 2014 Exhibit 10.19

Exhibit 10.19
Execution Version
Loan No. 1013119

EQUITY CONTRIBUTION GUARANTY 
(Secured Loan)
THIS EQUITY CONTRIBUTION GUARANTY (this “Guaranty”) is made as of December 30, 2014, by KBS SOR US PROPERTIES II LLC, a Delaware limited liability company (“Guarantor”), in favor of WELLS FARGO BANK, NATIONAL ASSOCIATION (together with its successors and assigns, “Lender”).
R E C I T A L S
		
	A.
	Pursuant to the terms of that certain Loan Agreement, dated as of the date hereof, by and among IC Myrtle Beach LLC, a Delaware limited liability company (“Borrower”), IC Myrtle Beach Operations LLC, a Delaware limited liability company (“Operating Lessee”), and Lender (as the same may be amended, modified, supplemented or replaced from time to time, the “Loan Agreement”), Lender has agreed to loan to Borrower the principal sum of up to Thirty-Eight Million Dollars ($38,000,000) (the “Loan”) for the purposes specified in the Loan Agreement.

		
	B.
	The Loan is evidenced by a Promissory Note Secured by Mortgage in the principal amount of the Loan (as the same may be amended, modified or replaced from time to time, the “Note”), executed by Borrower in favor of Lender, and is further evidenced by the documents described in the Loan Agreement as the “Loan Documents”.  The Note is secured by, among other things, a Fee and Leasehold Construction Mortgage, Security Agreement, Assignment of Leases and Rents and Fixture Filing, dated as of the date hereof, executed by Borrower and Operating Lessee, together as mortgagor, in favor of Lender, as mortgagee (as the same may be amended, modified, supplemented or replaced from time to time, the “Mortgage”).  All capitalized terms not otherwise defined herein shall have the meanings given to them in the Loan Agreement.

		
	C.
	As a condition to Lender’s agreement to enter into the Loan Agreement, Guarantor has agreed to enter into this Guaranty.

		
	D.
	Guarantor is the direct or indirect owner of Borrower and will benefit from the Loan.

THEREFORE, to induce Lender to enter into the Loan Agreement, and in consideration thereof, Guarantor unconditionally, absolutely and irrevocably guarantees and agrees as follows:
		
	1.
	GUARANTY.  Guarantor hereby unconditionally, absolutely and irrevocably guarantees and promises to pay to Lender, or order, on demand, in lawful money of the United States of America, in immediately available funds, an amount equal to the sum of (i) $5,530,000 plus (ii) any In Balance Payments required pursuant to the terms of the Loan Agreement (the “Guaranteed Equity Contribution”).  The Guaranteed Equity Contribution shall be reduced dollar-for-dollar by the costs paid by Borrower from equity toward completion of the Renovations, subject to Lender’s receipt from Borrower of evidence reasonably acceptable to Lender of the payment of such costs, including contractor draw applications, invoices, lien waivers and certification from Lender’s inspecting architect (the “Draw Package”).  Lender agrees to review each Draw Package submitted by Borrower within ten (10) days of receipt thereof and, if such Draw Package is acceptable, to acknowledge in writing Lender’s acceptance of such Draw Package and the aggregate amount by which the Guaranteed Equity Contribution is reduced as a result of the costs evidenced by the Draw Package.  

2.    TERMINATION.  Guarantor’s obligations under this Guaranty shall terminate, and be of no further force and effect, upon the date (the “Termination Date”) that is the earlier of (i) Lender’s written confirmation that (a) the Renovations are Complete and (b) the Guaranteed Equity Contribution has been fully funded by Borrower, Guarantor, either of their respective Affiliates, or any combination thereof and (ii) the date on which Borrower fully pays and performs the Secured

Loan No. 1013119

 Obligations.  Upon the Termination Date, Lender agrees to execute and deliver to Guarantor such documents as are reasonably necessary to evidence the termination of this Guaranty.
		
	3.
	NO WAIVER, RELEASE OR IMPAIRMENT.  Nothing contained in this Guaranty shall be deemed to waive, release, affect or impair the indebtedness evidenced by the Loan Documents or the obligations of Borrower under the Loan Documents, or the liens and security interests created by the Loan Documents, or Lender’s rights to enforce its rights and remedies under the Loan Documents and under this Guaranty or the indemnity provided herein, in the Loan Documents or in connection with the Loan, or otherwise provided in equity or under applicable law, including, without limitation, the right to pursue any remedy for injunctive or other equitable relief, or any suit or action in connection with the preservation, enforcement or foreclosure of the liens, mortgages, assignments and security interests which are now or at any time hereafter security for the payment and performance of all obligations under the Loan Agreement or in the other Loan Documents.  The provisions of Section 1 of this Guaranty shall prevail and control over any contrary provisions elsewhere in this Guaranty or the other Loan Documents.

		
	4.
	REMEDIES.  At any time when a Default exists under the Loan Documents, Lender may from time to time, and without first requiring performance by Borrower or exhausting any or all security for the Loan, bring an action at law or in equity or both to compel Guarantor to perform its obligations hereunder, and to collect in any such action compensation for all loss, cost, damage, injury and expense sustained or incurred by Lender as a direct or indirect consequence of the failure of Guarantor to perform its obligations hereunder, together with interest thereon at the rate of interest applicable to the principal balance of the Note.  Notwithstanding the foregoing, Lender agrees that following the occurrence of a monetary Default, (i) it will not have the right to pursue Guarantor under the terms of this Guaranty for the Guaranteed Equity Contribution unless (a) Lender has demanded in writing Guarantor’s performance under the Completion Guaranty and (b) Guarantor has failed within ten (10) days after receipt of such written demand to commence construction of the Renovations and once commenced to diligently pursue such construction to completion and (ii) the Guaranteed Equity Contribution shall be reduced by any amounts on deposit in the Owner’s Account; provided such amounts either (a) remain in such account (under the sole dominion and control of Lender) at the time of consummation of the exercise by Lender of its remedies under the Loan Documents or (b) are applied by Lender against obligations of Borrower under the Loan Documents.  Lender shall have the right to collect in any action to compel Guarantor’s performance hereunder compensation for all loss, cost, damage, injury and expense sustained or incurred by Lender as a direct or indirect consequence of the failure of Guarantor to perform its obligations hereunder, together with interest thereon at the rate of interest applicable to the principal balance of the Note.  

		
	5.
	RIGHTS OF LENDER.  Guarantor authorizes Lender, without giving notice to Guarantor or obtaining Guarantor’s consent and without affecting the liability of Guarantor, from time to time to: (a) renew, modify or extend all or any portion of Borrower’s obligations under the Note or any of the other Loan Documents; (b) declare all sums owing to Lender under the Note and the other Loan Documents due and payable upon the occurrence of a Default (as defined in the Loan Agreement) under the Loan Documents; (c) make non‐material changes in the dates specified for payments of any sums payable in periodic installments under the Note or any of the other Loan Documents; (d) otherwise modify the terms of any of the Loan Documents, except for (i) increases in the principal amount of the Note or changes in the manner by which interest rates, fees or charges are calculated under the Note and the other Loan Documents (Guarantor acknowledges that if the Note or other Loan Documents so provide, said interest rates, fees and charges may vary from time to time) or (ii) advancement of the Maturity Date of the Note where no Default has occurred under the Loan Documents; (e) take and hold security for the performance of Borrower’s obligations under the Note or the other Loan Documents and exchange, enforce, waive and release any such security; (f) apply such security and direct the order or manner of sale thereof as Lender in its discretion may determine; (g) release, substitute or add any one or more endorsers of the Note or guarantors of Borrower’s obligations under the Note or the other Loan Documents; (h) apply payments received by Lender from Borrower to any 

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obligations of Borrower to Lender, in such order as Lender shall determine in its sole discretion, whether or not any such obligations are covered by this Guaranty; (i) assign this Guaranty in whole or in part; and (j) assign, transfer or negotiate all or any part of the indebtedness evidenced by the Note and the other Loan Documents.
		
	6.
	GUARANTOR’S WAIVERS.  Guarantor waives:  (a) any defense based upon any legal disability or other defense of Borrower, any other guarantor or other person, or by reason of the cessation or limitation of the liability of Borrower from any cause other than full payment of all sums payable under the Note or any of the other Loan Documents; (b) any defense based upon any lack of authority of the officers, directors, partners, managers, members or agents acting or purporting to act on behalf of Borrower, Guarantor or any principal of Borrower or Guarantor or any defect in the formation of Borrower, Guarantor or any principal of Borrower or Guarantor; (c) any defense based upon the application by Borrower of the proceeds of the Loan for purposes other than the purposes represented by Borrower to Lender or intended or understood by Lender or Guarantor; (d) any right and defense arising out of an election of remedies by Lender, even though that election of remedies, such as a nonjudicial foreclosure with respect to security for a guaranteed obligation, has destroyed Guarantor’s rights of subrogation and reimbursement against Borrower by the operation of Section 580d of the California Code of Civil Procedure or otherwise; (e) any defense based upon Lender’s failure to disclose to Guarantor any information concerning Borrower’s financial condition or any other circumstances bearing on Borrower’s ability to pay all sums payable under the Note or any of the other Loan Documents; (f) any defense based upon any statute or rule of law which provides that the obligation of a surety must be neither larger in amount nor in any other respects more burdensome than that of a principal; (g) any defense based upon Lender’s election, in any proceeding instituted under the Federal Bankruptcy Code, of the application of Section 1111(b)(2) of the Federal Bankruptcy Code or any successor statute; (h) any defense based upon any borrowing or any grant of a security interest under Section 364 of the Federal Bankruptcy Code; (i) any right of subrogation, any right to enforce any remedy which Lender may have against Borrower and any right to participate in, or benefit from, any security for the Note or the other Loan Documents, now or hereafter held by Lender; (j) presentment, demand, protest and notice of any kind; (k) the benefit of any statute of limitations affecting the liability of Guarantor hereunder or the enforcement hereof; and (l) any rights under California Code of Civil Procedure Sections 580a and 726(b) which provide, among other things, that (i) a creditor must file a complaint for deficiency within three (3) months of a nonjudicial foreclosure sale or judicial foreclosure sale, as applicable, (ii) a fair market value hearing must be held, and (iii) the amount of the deficiency judgment shall be limited to the amount by which the unpaid debt exceeds the fair market value of the security, but not more than the amount by which the unpaid debt exceeds the sale price of the security.  Guarantor further waives any and all rights and defenses that Guarantor may have because Borrower’s debt is secured by real property; this means, among other things, that: (1) Lender may collect from Guarantor without first foreclosing on any real or personal property collateral pledged by Borrower; (2) if Lender forecloses on any real property collateral pledged by Borrower, then (A) the amount of the debt may be reduced only by the price for which that collateral is sold at the foreclosure sale, even if the collateral is worth more than the sale price, and (B) Lender may collect from Guarantor even if Lender, by foreclosing on the real property collateral, has destroyed any right Guarantor may have to collect from Borrower.  The foregoing sentence is an unconditional and irrevocable waiver of any rights and defenses Guarantor may have because Borrower’s debt is secured by real property.  Those rights and defenses being waived by Guarantor include, but are not limited to, any rights or defenses based upon Sections 580a, 580b, 580d or 726 of the California Code of Civil Procedure.  Without limiting the generality of the foregoing or any other provision hereof, Guarantor further expressly waives to the extent permitted by law any and all rights and defenses, including without limitation any rights of subrogation, reimbursement, indemnification and contribution, which might otherwise be available to Guarantor under California Civil Code Sections 2787 to 2855, inclusive, 2899 and 3433, or under California Code of Civil Procedure Sections 580a, 580b, 580d and 726, or any of such sections.  Finally, Guarantor agrees that the performance of any act or any payment which tolls 

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Loan No. 1013119

any statute of limitations applicable to the Note or any of the other Loan Documents shall similarly operate to toll the statute of limitations applicable to Guarantor’s liability hereunder.
		
	7.
	GUARANTOR’S WARRANTIES.  Guarantor warrants, represents, covenants and acknowledges that: (a) Lender would not make the Loan but for this Guaranty; (b) there are no conditions precedent to the effectiveness of this Guaranty; (c) Guarantor has established adequate means of obtaining from sources other than Lender, on a continuing basis, financial and other information pertaining to Borrower’s financial condition, the Property and Borrower’s activities relating thereto and the status of Borrower’s performance of obligations under the Loan Documents, and Guarantor agrees to keep adequately informed from such means of any facts, events or circumstances which might in any way affect Guarantor’s risks hereunder and Lender has made no representation to Guarantor as to any such matters; (d) the most recent financial statements of Guarantor previously delivered to Lender are true and correct in all respects, have been prepared in accordance with generally accepted accounting principles consistently applied (or other principles acceptable to Lender) and fairly present the financial condition of Guarantor as of the respective dates thereof, and no material adverse change has occurred in the financial condition of Guarantor since the respective dates thereof; and (e) Guarantor has not and will not, without the prior written consent of Lender, sell, lease, assign, encumber, hypothecate, transfer or otherwise dispose of all or substantially all of Guarantor’s assets, or any interest therein, other than in the ordinary course of Guarantor’s business.  

		
	8.
	SUBORDINATION.  Guarantor subordinates all present and future indebtedness owing by Borrower to Guarantor to the obligations at any time owing by Borrower to Lender under the Note and the other Loan Documents. Guarantor assigns all such indebtedness to Lender as security for this Guaranty, the Note, and the other Loan Documents.  Guarantor agrees to make no claim for such indebtedness until all obligations of Borrower under the Note and the other Loan Documents have been fully discharged. Guarantor agrees that it will not take any action or initiate any proceedings, judicial or otherwise, to enforce Guarantor’s rights or remedies with respect to any such indebtedness, including without limitation any action to enforce remedies with respect to any defaults under such indebtedness or to any collateral securing such indebtedness or to obtain any judgment or prejudgment remedy against Borrower or any such collateral.  Guarantor also agrees that it will not commence or join with any other creditor or creditors of Borrower in commencing any bankruptcy, reorganization or insolvency proceedings against Borrower. Guarantor further agrees not to assign all or any part of such indebtedness unless Lender is given prior notice and such assignment is expressly made subject to the terms of this Guaranty.  If Lender so requests, (a) all instruments evidencing such indebtedness shall be duly endorsed and delivered to Lender, (b) all security for such indebtedness shall be duly assigned and delivered to Lender, (c) such indebtedness shall be enforced, collected and held by Guarantor as trustee for Lender and shall be paid over to Lender on account of the Loan, but without reducing or affecting in any manner the liability of Guarantor under the other provisions of this Guaranty, and (d) Guarantor shall execute, file and record such documents and instruments and take such other action as Lender deems necessary or appropriate to perfect, preserve and enforce Lender’s rights in and to such indebtedness and any security therefor.  If Guarantor fails to take any such action, Lender, as attorney-in-fact for Guarantor, is hereby authorized to do so in the name of Guarantor.  The foregoing power of attorney is coupled with an interest and cannot be revoked.

		
	9.
	BANKRUPTCY OF BORROWER.  In any bankruptcy or other proceeding in which the filing of claims is required by law, Guarantor shall file all claims which Guarantor may have against Borrower relating to any indebtedness of Borrower to Guarantor and shall assign to Lender all rights of Guarantor thereunder. If Guarantor does not file any such claim, Lender, as attorney-in-fact for Guarantor, is hereby authorized to do so in the name of Guarantor or, in Lender’s discretion, to assign the claim to a nominee and to cause proof of claim to be filed in the name of Lender’s nominee.  The foregoing power of attorney is coupled with an interest and cannot be revoked.  Lender or its nominee shall have the right, in its reasonable discretion, to accept or reject any plan proposed in such proceeding and to take any other action which a party filing a claim is entitled to do.  In all such cases, whether in administration, bankruptcy or otherwise, the 

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Loan No. 1013119

person or persons authorized to pay such claim shall pay to Lender the amount payable on such claim and, to the full extent necessary for that purpose, Guarantor hereby assigns to Lender all of Guarantor’s rights to any such payments or distributions; provided, however, Guarantor’s obligations hereunder shall not be satisfied except to the extent that Lender receives cash by reason of any such payment or distribution.  If Lender receives anything hereunder other than cash, the same shall be held as collateral for amounts due under this Guaranty.  If all or any portion of the obligations guaranteed hereunder are paid or performed, the obligations of Guarantor hereunder shall continue and shall remain in full force and effect in the event that all or any part of such payment or performance is avoided or recovered directly or indirectly from Lender as a preference, fraudulent transfer or otherwise under the Bankruptcy Code or other similar laws, irrespective of (a) any notice of revocation given by Guarantor prior to such avoidance or recovery, or (b) full payment and performance of all of the indebtedness and obligations evidenced and secured by the Loan Documents.
		
	10.
	LOAN SALES AND PARTICIPATIONS; DISCLOSURE OF INFORMATION.  Subject to the limitations set forth in the Loan Agreement, Guarantor agrees that Lender may elect, at any time, to sell, assign, or grant participations in all or any portion of their rights and obligations under the Loan Documents and this Guaranty, and that any such sale, assignment or participation may be to one or more financial institutions, private investors, and/or other entities, at Lender’s sole discretion.  Guarantor further agrees that Lender may disseminate to any such actual or potential purchaser(s), assignee(s) or participant(s) all documents and information (including, without limitation, all financial information) which has been or is hereafter provided to or known to Lender with respect to: (a) the Property and its operation; (b) any party connected with the Loan (including, without limitation, Guarantor, Borrower, any partner of Borrower, any constituent partner of Borrower, any other guarantor and any non-borrower trustor); and/or (c) any lending relationship other than the Loan which Lender may have with any party connected with the Loan; provided, however, any recipients of any Non-Public Information shall have signed a commercially reasonable confidentiality agreement with respect to such Non-Public Information prior to receiving the same.  In the event of any such sale, assignment or participation, Lender and the parties to such transaction shall share in the rights and obligations of Lender as set forth in the Loan Documents only as and to the extent they agree among themselves.  In connection with any such sale, assignment or participation, Guarantor further agrees that the Guaranty shall be sufficient evidence of the obligations of Guarantor to each purchaser, assignee, or participant, and upon written request by Lender, Guarantor shall, within fifteen (15) days after request by Lender, (x) deliver to Lender and any other party designated by Lender an estoppel certificate, in form and substance acceptable to Lender, verifying for the benefit of Lender and any such other party the status, terms and provisions of this Guaranty, and (y) enter into such amendments or modifications to this Guaranty and the Loan Documents as Lender may reasonably request in order to evidence and facilitate any such sale, assignment, or participation without impairing Guarantor’s rights or increasing Guarantor’s obligations hereunder.

Anything in this Agreement to the contrary notwithstanding, and without the need to comply with any of the formal or procedural requirements of this Agreement, including this Section, Lender may at any time and from time to time pledge and assign all or any portion of its rights under all or any of the Loan Documents to a Federal Reserve Bank; provided that no such pledge or assignment shall release such lender from its obligations thereunder.  
		
	11.
	ADDITIONAL, INDEPENDENT AND UNSECURED OBLIGATIONS.  This Guaranty is a continuing guaranty of payment and not of collection and cannot be revoked by Guarantor and shall continue to be effective with respect to any indebtedness referenced in Section 1 hereof arising or created after any attempted revocation hereof or after the death of Guarantor (if Guarantor is a natural person, in which event this Guaranty shall be binding upon Guarantor’s estate and Guarantor’s legal representatives and heirs). The obligations of Guarantor hereunder shall be in addition to and shall not limit or in any way affect the obligations of Guarantor under any other existing or future guaranties unless said other guaranties are expressly modified or revoked in writing. This Guaranty is independent of the obligations of Borrower under the Note, 

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the Mortgage and the other Loan Documents. Guarantor hereby authorizes and empowers Lender to exercise, in its sole discretion, any rights and remedies, or any combination thereof, which may then be available, since it is the intent and purpose of Guarantor that the obligations hereunder shall be absolute, independent and unconditional under any and all circumstances. Except as otherwise expressly limited by the terms of this Guaranty, Lender may bring a separate action to enforce the provisions hereof against Guarantor without taking action against Borrower or any other party or joining Borrower or any other party as a party to such action.  Except as otherwise provided in this Guaranty, this Guaranty is not secured and shall not be deemed to be secured by any security instrument unless such security instrument expressly recites that it secures this Guaranty.
		
	12.
	ATTORNEYS’ FEES; ENFORCEMENT.  If any attorney is engaged by Lender to enforce or defend any provision of this Guaranty, or any of the other Loan Documents, or as a consequence of any Default under the Loan Documents, with or without the filing of any legal action or proceeding, Guarantor shall pay to Lender, immediately upon demand all attorneys’ fees and costs incurred by Lender in connection therewith, together with interest thereon from the date of such demand until paid at the rate of interest applicable to the principal balance of the Note as specified therein.

		
	13.
	RULES OF CONSTRUCTION.  The term “Borrower” as used herein shall include both the named Borrower and any other person at any time assuming or otherwise becoming primarily liable for all or any part of the obligations of the named Borrower under the Note and the other Loan Documents.  The term “person” as used herein shall include any individual, company, trust or other legal entity of any kind whatsoever. If this Guaranty is executed by more than one person, the term “Guarantor” shall include all such persons. When the context and construction so require, all words used in the singular herein shall be deemed to have been used in the plural and vice versa.  All headings appearing in this Guaranty are for convenience only and shall be disregarded in construing this Guaranty.

		
	14.
	CREDIT REPORTS.  Each legal entity and individual obligated on this Guaranty hereby authorizes Lender to order and obtain, from a credit reporting agency of Lender’s choice, a third party credit report on such legal entity and individual.

		
	15.
	GOVERNING LAW.  This Guaranty shall be governed by, and construed in accordance with, the laws of the State of California, except to the extent preempted by federal laws.  Guarantor and all persons and entities in any manner obligated to Lender under this Guaranty consent to the jurisdiction of any federal or state court within the State of California having proper venue and also consent to service of process by any means authorized by California or federal law.

		
	16.
	INTENTIONALLY OMITTED.

		
	17.
	MISCELLANEOUS. The provisions of this Guaranty will bind and benefit the heirs, executors, administrators, legal representatives, nominees, successors and assigns of Guarantor, and Lender. The liability of all persons and entities who are in any manner obligated hereunder shall be joint and several. If any provision of this Guaranty shall be determined by a court of competent jurisdiction to be invalid, illegal or unenforceable, that portion shall be deemed severed from this Guaranty and the remaining parts shall remain in full force as though the invalid, illegal or unenforceable portion had never been part of this Guaranty.  This Guaranty shall be deemed to be continuing in nature and shall remain in full force and effect and shall survive the exercise of any remedy by Lender under the Mortgage or any of the other Loan Documents, including without limitation any foreclosure or deed in lieu thereof.

		
	18.
	ADDITIONAL PROVISIONS.  Such additional terms, covenants and conditions as may be set forth on any exhibit executed by Guarantor and attached hereto which recites that it is an exhibit to this Guaranty are incorporated herein by this reference.

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Loan No. 1013119

		
	19.
	ENFORCEABILITY.  Guarantor hereby acknowledges that: (a) the obligations undertaken by Guarantor in this Guaranty are complex in nature, and (b) numerous possible defenses to the enforceability of these obligations may presently exist and/or may arise hereafter, and (c) as part of Lender’s consideration for entering into this transaction, Lender has specifically bargained for the waiver and relinquishment by Guarantor of all such defenses, and (d) Guarantor has had the opportunity to seek and receive legal advice from skilled legal counsel in the area of financial transactions of the type contemplated herein.  Given all of the above, Guarantor does hereby represent and confirm to Lender that Guarantor is fully informed regarding, and that Guarantor does thoroughly understand: (i) the nature of all such possible defenses, and (ii) the circumstances under which such defenses may arise, and (iii) the benefits which such defenses might confer upon Guarantor, and (iv) the legal consequences to Guarantor of waiving such defenses.  Guarantor acknowledges that Guarantor makes this Guaranty with the intent that this Guaranty and all of the informed waivers herein shall each and all be fully enforceable by Lender, and that Lender is induced to enter into this transaction in material reliance upon the presumed full enforceability thereof.

		
	20.
	WAIVER OF RIGHT TO TRIAL BY JURY.  TO THE EXTENT PERMITTED BY THEN APPLICABLE LAW, EACH PARTY TO THIS GUARANTY, AND BY ITS ACCEPTANCE HEREOF, LENDER, HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (a) ARISING UNDER THE LOAN DOCUMENTS, INCLUDING, WITHOUT LIMITATION, ANY PRESENT OR FUTURE MODIFICATION THEREOF OR (b) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THE LOAN DOCUMENTS (AS NOW OR HEREAFTER MODIFIED) OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY AND LENDER HEREBY AGREE AND CONSENT THAT ANY PARTY TO THIS GUARANTY AND LENDER MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO AND LENDER TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.  THIS PROVISION IS A MATERIAL INDUCEMENT FOR LENDER TO MAKE THE LOAN TO BORROWER.

[Signature Follows on Next Page]

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Loan No. 1013119

The laws of South Carolina provide that in any real estate foreclosure proceeding a defendant against whom a personal judgment is taken or asked may within thirty days after the sale of the mortgaged property apply to the court for an order of appraisal.  The statutory appraisal value as approved by the court would be substituted for the high bid and may decrease the amount of any deficiency owing in connection with the transaction.  THE UNDERSIGNED HEREBY WAIVES AND RELINQUISHES THE STATUTORY APPRAISAL RIGHTS WHICH MEANS THE HIGH BID AT THE JUDICIAL FORECLOSURE SALE WILL BE APPLIED TO THE DEBT REGARDLESS OF ANY APPRAISED VALUE OF THE MORTGAGED PROPERTY.
Further, the undersigned acknowledges receipt of written notification before this transaction that signing of a waiver of appraisal rights would be required during this transaction.
IN WITNESS WHEREOF, Guarantor duly executed this Guaranty as of the date first written above.
“Guarantor”
KBS SOR US PROPERTIES II LLC,
a Delaware limited liability company
By:    KBS STRATEGIC OPPORTUNITY LIMITED PARTNERSHIP II,
a Delaware limited partnership,
its sole member
By:    KBS STRATEGIC OPPORTUNITY REIT II, INC.,
a Maryland corporation,
its sole general partner
By:    __/s/ David E. Snyder____________
David E. Snyder
Chief Financial Officer
Address of Guarantor: 
c/o KBS Capital Advisors LLC
620 Newport Center Drive, Suite 1300
Newport Beach, CA 92660
Attn:    Todd Smith    
Tel:    (949) 797-0338
Fax:    (949) 417-6520

With a copy to:

c/o KBS Capital Advisors LLC
620 Newport Center Drive, Suite 1300
Newport Beach, CA 92660
Attn:    Jeff Waldvogel
Tel:    (949) 797-0327
Fax:    (949) 417-6520
Address of Lender: 
 
Wells Fargo Bank, National Association 
Hospitality Finance Group 

[WFB - Integrated/KBS - Springmaid - Equity Contribution Guaranty]

Loan No. 1013119

333 S. Grand Ave., 9th Floor
Los Angeles, CA 90071
Attn:  Anna Chung
Tel:    (213) 253-7411
Fax:    (213) 253-7497

SFI-620880455v6 

Signature Page – Equity Contribution Guarantyexhibit10-1.htm

AMENDMENT NO. 2

TO REVOLVING CREDIT AGREEMENT

 

AMENDMENT NO. 2 TO REVOLVING CREDIT AGREEMENT (this “Amendment”), dated as of March 24, 2015, among SOUTHWEST GAS CORPORATION, a California corporation (the “Borrower”), each of the lenders parties to the Revolving Credit Agreement referred to below (collectively, the “Lenders”), and THE BANK OF NEW YORK MELLON, as Administrative Agent (the “Administrative Agent”).

 

RECITALS

 

 

A.           The Borrower, the Lenders and the Administrative Agent are parties to the Revolving Credit Agreement, dated as of March 15, 2012 (as amended by Amendment No. 1 to Revolving Credit Agreement, dated as of March 25, 2014, the “Credit Agreement”), pursuant to which the Lenders agreed to make Loans to the Borrower on the terms and conditions set forth therein.  Capitalized terms used herein that are not herein defined shall have the meanings ascribed thereto by the Credit Agreement.

 

B.           The Borrower has requested that the Lenders agree to (i) extend the Termination Date from March 25, 2019 to March 25, 2020 and (ii) amend Section 2.03(e) of the Credit Agreement in the manner set forth in this Amendment.  The Lenders are willing to so amend the Credit Agreement upon the terms and conditions herein contained.

 

THEREFORE, in consideration of the recitals and the terms and conditions herein contained, and of other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, it is agreed that:

 

1. On and as of the Amendment No. 2 Effective Date (as defined below), the Credit Agreement is hereby amended by adding in appropriate alphabetical order the following definitions in Section 1.01(c) thereof:

 

“Amendment No. 2” means that certain Amendment No. 2 to Revolving Credit Agreement dated as of March 24, 2015 among the Borrower, the lenders party thereto, and the Administrative Agent.

 

  

  

  

“Amendment No. 2 Effective Date” means March 24, 2015.

 

2. On and as of the Amendment No. 2 Effective Date, the Credit Agreement is hereby further amended by deleting the text of the definition of “Termination Date” in its entirety and substituting the following therefor:

 

“Termination Date” means March 25, 2020, as may be extended pursuant to Section 2.03(e), or such earlier date on which the Revolving Credit Notes shall become due and payable, whether by acceleration or otherwise.

 

3. On and as of the Amendment No. 2 Effective Date, the Credit Agreement is hereby further amended by deleting “Amendment No. 1 Effective Date” in Section 2.03(e) of the Credit Agreement and substituting “Amendment No. 2 Effective Date” therefor.

 

4. This Amendment shall be effective as of March 24, 2015 (the “Amendment No. 2 Effective Date”), provided that each of the following conditions precedent has been fulfilled by such date:

 

(a) Evidence of Action.  The Administrative Agent shall have received a certificate of the Secretary or an Assistant Secretary of the Borrower, dated the date of this Amendment, certifying and/or attaching thereto (i) all amendments, if any, to the articles of incorporation of the Borrower since March 25, 2014, certified by the Secretary of State of California as of a recent date and by the Secretary or Assistant Secretary of the Borrower (or if there have been none, a certification to such effect) and all amendments, if any, to the bylaws of the Borrower since March 25, 2014, certified by the Secretary or Assistant Secretary of the Borrower (or if there have been none, a certification to such effect), (ii) certificates of good standing for the Borrower from each of the Secretary of State of California and the Secretaries of State of the states where the Borrower conducts its principal operations, certifying that the Borrower is in good standing in such states, such certificates to be dated reasonably near the date of this Amendment, (iii) copies of the resolutions of the board of directors of the Borrower approving and authorizing the execution, delivery and performance by the Borrower of this Amendment and (iv) the names and true signatures of the officers of the Borrower authorized to sign this Amendment and any certificates or other documents, to be delivered in connection herewith.

 

(b) This Amendment.  The Administrative Agent shall have received this Amendment executed by a duly authorized officer of the Borrower, and consented to by each Lender.

 

(c) Fees and Expenses.  The Borrower shall have paid (i) the reasonable fees and expenses of counsel to the Administrative Agent in connection with the preparation, negotiation and closing of this Amendment and all documents executed and delivered in connection herewith and (ii) the fees and other amounts required to be

 

  2

  

  

 

paid to the Administrative Agent and the Lenders on the Amendment No. 2 Effective Date pursuant to that certain fee letter dated as of March 5, 2015 between The Bank of New York Mellon and the Borrower.

 

(d) Compliance.  After giving effect to this Amendment, (i) the Borrower shall be in compliance in all material respects with all of the terms, covenants and conditions of the Credit Documents as amended hereby, (ii) there shall exist no Default or Event of Default and (iii) the representations and warranties contained in the Credit Documents as amended hereby shall be true and correct in all material respects with the same effect as though such representations and warranties had been made on and as of the date hereof (except to the extent that any representation or warranty speaks as of a certain date).

 

5. The Borrower hereby reaffirms and admits the validity and enforceability of the Credit Documents and all of its obligations thereunder, agrees and admits that it has no defenses to or offsets against any of the obligations under the Credit Documents, and represents and warrants that (i) the Recitals to this Amendment are true and correct, (ii) there exists no Default or Event of Default and (iii) the representations and warranties contained in the Credit Documents are true and correct in all material respects on and as of the date hereof, except those representations and warranties that were made as of a specific date, in which case such representations and warranties were true and correct in all material respects on and as of such earlier date.

 

6. In all other respects the Credit Agreement and the other Credit Documents shall remain in full force and effect, and no amendment of any term or condition of the Credit Agreement herein contained shall be deemed to be an amendment of any other term or condition contained in the Credit Agreement or any other Credit Document or constitute a waiver of any Default or Event of Default.

 

7. The Borrower agrees to pay the reasonable fees and expenses of the Administrative Agent’s counsel in connection with this Amendment and all documents executed and delivered in connection herewith in accordance with Section 4.06(a) of the Credit Agreement.

 

8. This Amendment may be executed by one or more of the parties to this Amendment on any number of separate counterparts (including by telecopy or email), and all of such counterparts taken together shall be deemed to constitute one and the same instrument.

 

9. THIS AMENDMENT SHALL, PURSUANT TO NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1401, BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

 

[Remainder of page intentionally left blank; signature pages follow]

 

  

 3 

  

The Borrower, the Lenders and the Administrative Agent have caused this Amendment to be duly executed as of the date first above written.

	  	
SOUTHWEST GAS CORPORATION

	  
	 	 	 	 
	 	 	 	 
	  	
By:

	
/S/ KENNETH J. KENNY

	  
	  	  	
Name:

	
Kenneth J. Kenny

	  
	  	
 

	
Title:

	
Vice President/Finance/Treasurer

	  
	  	  	  	  	  

[Signature Page to Amendment No. 2]

 

  

  

  

	  	

THE BANK OF NEW YORK MELLON, as

a Lender and as Administrative Agent

	  
	 	 	 	 
	 	 	 	 
	  	
By:

	
/S/ MARK W. ROGERS

	  
	  	  	
Name:

	
Mark W. Rogers

	  
	  	
 

	
Title:

	
Vice President

	  
	  	  	  	  	  

 

[Signature Page to Amendment No. 2]

 

 

  

  

  

	  	
JPMORGAN CHASE BANK, N.A., as a

Lender

	  
	 	 	 	 
	 	 	 	 
	  	
By:

	
/S/ JUSTIN MARTIN

	  
	  	  	
Name:

	
Justin Martin

	  
	  	
 

	
Title:

	
Authorized Officer

	  
	  	  	  	  	  

 

 

[Signature Page to Amendment No. 2]

 

 

  

  

  

 

 

	  	
BANK OF AMERICA, N.A., as a Lender

	  
	 	 	 	 
	 	 	 	 
	  	
By:

	
/S/ MICHELE GORDON 

	  
	  	  	
Name:

	
Michele Gordon

	  
	  	
 

	
Title:

	
SVP

	  
	  	  	  	  	  

[Signature Page to Amendment No. 2]

 

 

  

  

  

	  	
MUFG UNION BANK, N.A. (f/k/a UNION

BANK, N.A.), as a Lender

	  
	 	 	 	 
	 	 	 	 
	  	
By:

	
/S/ LINDSAY MINNEMAN

	  
	  	  	
Name:

	
Lindsay Minneman

	  
	  	
 

	
Title:

	
Vice President

	  
	  	  	  	  	  

[Signature Page to Amendment No. 2]

 

 

  

  

  

	  	
KEYBANK NATIONAL ASSOCIATION,

as a Lender

	  
	 	 	 	 
	 	 	 	 
	  	
By:

	
/S/ KEVEN D. SMITH

	  
	  	  	
Name:

	
Keven D. Smith

	  
	  	
 

	
Title:

	
Senior Vice President

	  
	  	  	  	  	  

[Signature Page to Amendment No. 2]

 

 

  

  

  

	  	
WELLS FARGO BANK, NATIONAL

ASSOCIATION, as a Lender

	  
	 	 	 	 
	 	 	 	 
	  	
By:

	
/S/ YANN BLINDERT

	  
	  	  	
Name:

	
Yann Blindert

	  
	  	
 

	
Title:

	
Director

	  
	  	  	  	  	  

[Signature Page to Amendment No. 2]

 

 

  

  

  

	  	
U.S. BANK NATIONAL ASSOCIATION,

as a Lender

	  
	 	 	 	 
	 	 	 	 
	  	
By:

	
/S/ HOLLAND H. WILLIAMS 

	  
	  	  	
Name:

	
Holland H. Williams

	  
	  	
 

	
Title:

	
VICE PRESIDENT

	  
	  	  	  	  	  

[Signature Page to Amendment No. 2]

 

 

  

  

  

	  	
THE NORTHERN TRUST COMPANY, as

a Lender

	  
	 	 	 	 
	 	 	 	 
	  	
By:

	
/S/ JOHN LASCODY

	  
	  	  	
Name:

	
John Lascody

	  
	  	
 

	
Title:

	
Vice President

	  
	  	  	  	  	  

[Signature Page to Amendment No. 2]

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