Document:

Exhibit 10.5

 

WMLM

101695/207

Execution

 

GUARANTY OF COMPLETION

 

THIS GUARANTY OF COMPLETION (this “Guaranty”) is made as of the 3rd day of February, 2012, by RBH-TRB NEWARK HOLDINGS, LLC, a New York limited liability company having an office at c/o RBH Group, 89 Market Street, 8th Floor, Newark, New Jersey 07102  (“RBH”) and RBH-TRB EAST MEZZ URBAN RENEWAL ENTITY, LLC,  a New Jersey limited liability company having an office at c/o RBH Group, 89 Market Street, 8th Floor, Newark, New Jersey 07102 (“Borrower”) (as guarantor hereunder), and together with RBH, jointly and severally, “Guarantor”) in favor of TD BANK, N.A., a national banking association, having an office at 317 Madison Avenue, New York, New York 10017 (the “Bank”).

 

R  E  C  I  T  A  L  S :

 

WHEREAS, RBH is affiliated with Borrower and Leasehold Owner (as herein defined), and will derive substantial benefit from the transactions contemplated by that certain Bond Agreement dated as of December 1, 2011 by and among Borrower, Bank and the New Jersey Economic Development Authority (the “Issuer”), (as the same may be amended, restated, modified or supplemented, the “Bond Agreement”; together with all documents entered into in connection therewith or pursuant thereto, the “Bond Documents”).  All capitalized terms used herein and not otherwise defined shall have the same meanings assigned to such terms in the Bond Agreement; and

 

WHEREAS, pursuant to the Bond Agreement, the Issuer issued $22,748,000 of its Qualified School Construction Bonds (the “Bonds”), and the Fee Owner requested and the Bank purchased the Bonds subject to certain conditions set forth in the Bond Agreement; and

 

WHEREAS, the Bonds are secured by, among other things, that certain Mortgage and Security Agreement (together with all extensions, renewals, modifications, substitutions and amendments thereof, the “Mortgage”) dated of even date herewith, made by Borrower in favor of the Issuer and assigned to the Bank;  and

 

WHEREAS, the premises secured by the Mortgage consists of that certain parcel of land situated in the City of Newark, County of Essex, State of New Jersey (the “State”), more particularly described on Exhibit A attached to the Mortgage (the “Premises”, and together with improvements thereon as set forth and defined in the Mortgage, the “Mortgaged Property”); and

 

WHEREAS, the Premises has been leased by the Fee Owner to Newark Teacher’s Village School QALICB Urban Renewal, LLC, a New Jersey limited liability company (“Leasehold Owner”) pursuant to that certain Ground Lease by and between Fee Owner and Leasehold Owner dated as of the date hereof (the “Ground Lease”); and

 

WHEREAS, each of NJCC CDE Essex LLC (“NJCC Lender”) and Gateway Sub-CDE I, LLC (“Gateway Lender”, and together with NJCC Lender, the “CDE Lenders”)

 

 

have made loans to Leasehold Owner as qualified low income community investments loans, the “QLICIs”); and

 

WHEREAS, Bank, Fee Owner, Leasehold Owner, the Brick City Development Corporation, the Casino Reinvestment Development Authority and the CDE Lenders as the same may be amended and supplemented (the “Intercreditor Agreement”), the Bank has agreed to accept this Guaranty subject to the Intercreditor Agreement; and

 

WHEREAS, as additional security for the full, timely and faithful repayment of the Bonds and the performance by Borrower of all of its obligations under the Bond Agreement and the Bond Documents, Bank required as a condition to entering into the Bond Agreement and purchasing the Bonds that Guarantor execute and deliver to the Bank this Guaranty for the benefit of the Bank.

 

NOW, THEREFORE, in consideration of the premises and other good and valuable consideration, the receipt of which is hereby acknowledged, and in order to induce Bank to enter into the Bond Agreement and purchase the Bonds, each Guarantor hereby represents, warrants and covenants to Bank as to itself as follows:

 

1.                                       Formation and Existence; Power and Authority. Guarantor is a limited liability company, duly organized, validly existing and in good standing under the laws of the state of its formation and has full power and authority to execute, deliver and perform this Guaranty and any Loan Document to which it is a party.  Guarantor will preserve and maintain such legal existence and good standing.

 

2.                                       Obligations Guaranteed.  (a)  Guarantor unconditionally guarantees to Bank, (i) the Substantial Completion of the Improvements pursuant to the Plans free and clear of all liens on or before the Completion Date (as such terms are defined in the Building Loan Agreement dated as of the date hereof by and among the Bank, as Administrative Agent, CDE Lenders and Leasehold Owner (the “Building Loan Agreement”)); (ii) subject to the Intercreditor Agreement, the complete and timely performance of Borrower’s obligations (A) if the Bank exercises Bank’s right under the Bond Agreement to take possession of the Premises and complete the construction of the Improvements in accordance with the Plans, to reimburse Bank for all costs and expenses incurred by Bank in so completing construction of the Improvements; (B) to pay the premiums for all policies of insurance required to be furnished by Borrower pursuant to the Bond Agreement and the Leasehold Owner pursuant to the Building Loan Agreement during the period of construction until Completion of the Improvements, if not paid when due by Borrower and Leasehold Owner, as applicable; (C) to pay all interest and fees on the Bonds accruing during the period of construction until Completion of the Improvements in accordance with the Plans, if not paid when due by Borrower; and (D) to pay all sewer and water rents, vault taxes, real estate taxes and assessments and payments in lieu of the foregoing, assessed or levied against the Premises and/or the Improvements during the period of construction until Completion of the Improvements in accordance with the Plans, if not paid when due by Borrower or Leasehold Owner; and (iii) payment in full of any and all expenses actually paid or incurred by the Bank in the collection of all or any portion of the Guarantor’s obligations hereunder or the exercise or enforcement of any one or more of the other rights, powers, privileges, remedies and interests of the Bank under the Loan Documents or hereunder, 

 

2

 

including, without limitation, reasonable attorneys’ fees, irrespective of the manner or success of any such collection, exercise or enforcement, and whether or not such expenses constitute part of the Borrower’s obligations ((i), (ii) and (iii) collectively, the “Liabilities”).

 

(b)                                 Notwithstanding the foregoing, if none of the proceeds of the Bonds that are deposited into the QSCB Leverage Loan Account established under the Master Escrow Deposit Agreement are released pursuant to the terms thereof, the definition of “Improvements” hereunder and under the Building Loan Agreement shall not be deemed to refer to the Improvements relating to Building 6.1.

 

(c)                                  If the Bank has sent Guarantor written notice to perform its obligations under Section 2 above, subject to the provisions of the Intercreditor Agreement, the Bank shall approve the disbursement of Bonds proceeds and any other construction funds held under and in accordance with the Intercreditor Agreement (collectively, the “Construction Funds”) on the same terms and conditions as set forth in the Building Loan Agreement for the purposes of Guarantor completing the Improvements and fulfilling its other obligations under this Guaranty, so long as (i) Guarantor is not in default under this Guaranty; (ii) Guarantor cures any outstanding default under the Loan Documents (including any failure of the Loan to be “in balance”) and thereafter performs all obligations assumed by Guarantor under this Guaranty up to the time of the lien-free completion of the Improvements; and (iii) all conditions of the Loan Documents, the Building Loan Agreement and the Intercreditor Agreement to the disbursement of the proceeds of the undisbursed Construction Funds are satisfied.

 

(d) Notwithstanding anything herein to the contrary, the Liabilities of the Guarantor hereunder shall be reduced by the amount of the undisbursed Construction Funds.

 

3.                                       Unconditional Guaranty.  This Guaranty is an absolute, unconditional, present and continuing guaranty of payment and performance and not of collection and is in no way conditioned or contingent upon any attempt to enforce Bank’s rights against Borrower or to collect from Borrower or upon any other condition or contingency; accordingly, Bank shall have the right to proceed against Guarantor immediately upon any Event of Default (as defined in the Bond Agreement) beyond applicable notice and cure periods under the Loan Documents without taking any prior action or proceeding to enforce the Loan Documents or any of them or for the liquidation or foreclosure of any security Bank may at any time hold pursuant thereto.  RBH hereby waives and releases any claim (within the meaning of 11 U.S.C. § 101) that it may have against Borrower or Leasehold Owner arising from a payment made by it under this Guaranty and agrees not to assert or take advantage of any subrogation rights of RBH or any right of RBH to proceed against Borrower or Leasehold Owner for reimbursement.  It is expressly understood that the waivers and agreements of Guarantor constitute additional and cumulative benefits given to Bank for its security and as an inducement for the purchase of the Bonds. During the course of any construction of the Improvements undertaken by Bank or any other Person on behalf of Bank, Guarantor agrees that Guarantor shall pay on demand any amounts due to contractors, subcontractors, and material suppliers and for permits and licenses necessary or desirable in connection therewith.  Guarantor’s obligations in connection with such work shall not be affected by any errors or omissions of Borrower’s Architect, the General Contractor, the 

 

3

 

Construction Consultant, (as such terms are defined in the Building Loan Agreement) or any subcontractor or agent or employee of any of the foregoing in the design, supervision, and performance of the work; it being understood that such risk is assumed by Guarantor.  Neither the completion of the Improvements nor failure to complete the Improvements shall relieve the Guarantor of any liabilities hereunder; rather, such liability shall be continuing and may be enforced by Bank to the end that the Improvements shall be completed in accordance with Section 4.2 of the Building Loan Agreement, lien free, without loss, cost, expense, injury or liability of any kind to Bank.  Bank may at any time and from time to time take any and/or all actions and enforce all rights and remedies available to it hereunder or under applicable law to collect from Guarantor any amounts then due and payable hereunder by Guarantor and/or to cause Guarantor to fulfill its obligations hereunder.

 

4.                                       Liability Unimpaired.  Guarantor’s liability hereunder shall in no way be limited or impaired by, and Guarantor hereby consents to and agrees to be bound by, any amendment or modification of the provisions of any of the Loan Documents or any other instrument made to or with Bank by Borrower, Leasehold Owner or Guarantor, or any Person (as hereafter defined) who succeeds Leasehold Owner as owner of all or part of the Premises prior to foreclosure of the Mortgage or exercise of any power of sale contained therein.  In addition, Guarantor’s liability hereunder shall in no way be limited or impaired by (i) any extensions of time for performance required by any of said documents, (ii) any sale, assignment or foreclosure of the Note or Mortgage or any sale or transfer of all or part of the property covered by the Mortgage, (iii) any exculpatory provision in any of said instruments limiting Bank’s recourse to the Premises or to any other security, or limiting Bank’s rights to a deficiency judgment against Borrower, (iv) the release of Borrower or any other person from performance or observance of any of the agreements, covenants, terms or conditions contained in any of said instruments by operation of law or otherwise, (v) the release or substitution in whole or in part of any security for the Bonds, (vi) Bank’s failure to record the Mortgage or file any UCC financing statements (or Bank’s improper recording or filing of same) or to otherwise perfect, protect, secure or insure any security interest or lien given as security for the Bonds, (vii) the invalidity, irregularity or unenforceability, in whole or in part, of any of the Loan Documents, this Guaranty or any other instrument or agreement executed or delivered to Bank in connection with the Bonds, except to the extent that there is a final adjudication by a court of competent jurisdiction of a valid defense to Borrower’s obligations under the Loan Documents (viii) any amendment, modification or supplement to the Project Cost Statement, Hard Cost Statement, Loan Budget Amounts, the General Contract, any Major Subcontract (each defined in the Building Loan Agreement) any construction management agreement or any other construction documents relating to the Improvements, or any extensions or changes of the Completion Date (as defined in the Building Loan Agreement) or any schedule with respect to the construction of the Improvements, (ix) the material inaccuracy of any of the representations and warranties made by Borrower in the Loan Documents or any disbursement certificates or requests for disbursements made under the Building Loan Agreement, or (x) any other action or circumstance whatsoever which constitutes, or might be construed to constitute, a legal or equitable discharge or defense (except full payment and satisfaction) of Borrower for its obligations under any of the Loan Documents or of Guarantor under this Guaranty; and, in any such case, whether with or without notice to Guarantor and with or without consideration.  As used herein, “Person” shall mean any individual, corporation, partnership, limited liability company, joint venture, estate, trust, unincorporated association, any other entity, any federal, state, county or municipal government 

 

4

 

or any bureau, department or agency thereof, and any fiduciary acting in such capacity on behalf of any of the foregoing.

 

5.                                       Preservation of Loan Documents.  RBH will cause Borrower to maintain and preserve the enforceability of the Loan Documents as the same may be modified and will not permit Borrower to take or to fail to take actions of any kind which might be the basis for a claim that RBH has a defense to Guarantor’s obligations hereunder.

 

6.                                       Reserved.

 

7.                                       Indemnification; Payments; Certain Waivers.  Guarantor (i) waives any right or claim of right to cause a marshalling of Borrower’s assets or to cause Bank to proceed against any of the security for the Bonds or for the obligations guaranteed hereby before proceeding against Guarantor, (ii) agrees that any payments required to be made by Guarantor hereunder shall become due on demand in accordance with the terms of Paragraph 2 hereof and without presentment to Borrower, demand for payment or protest, or notice of non-payment or protest, and (iii) except as hereinafter provided, expressly waives and relinquishes all rights and remedies accorded by applicable law to guarantors.  Without limiting the generality of the foregoing, Guarantor hereby waives all rights (x) to participate in any claim or remedy Bank may now or hereafter have against Borrower or in any collateral that Bank has or hereafter may acquire for the obligations guaranteed hereby and (y) except as provided below, to contribution, indemnification, set-off, exoneration or reimbursement, whether from Leasehold Owner, any Guarantor, or any other person now or hereafter primarily or secondarily liable for any of Borrower’s obligations to Bank, and whether arising by contract or operation of law or otherwise by reason of Guarantor’s execution, delivery or performance of this Guaranty.  Guarantor does not waive and hereby retains all rights of subrogation, contribution, indemnification, set-off or reimbursement against Leasehold Owner or any other Guarantor that Guarantor may have (the “Undersigned’s Rights”); provided, however, that (i) this Guaranty shall neither be contingent upon the existence of the Undersigned’s Rights nor subject to any claims or defenses whatsoever that may be asserted in connection with the enforcement or attempted enforcement of the Undersigned’s Rights including, without limitation, any claim that the Undersigned’s Rights were abrogated by any of Bank’s acts unless such acts constitute gross negligence or willful misconduct of the Bank, and (ii) until the Bonds shall have been paid in full, Guarantor hereby postpones and subordinates (A) the exercise of any and all of the Undersigned’s Rights to Bank’s rights against Guarantor under this Guaranty or against Borrower under any of the Loan Documents, and (B) any of the Undersigned’s Rights to any collateral securing the Bonds.

 

8.                                       Reinstatement.  This Guaranty shall continue to be effective, or be reinstated automatically, as the case may be, if at any time payment, in whole or in part, of any of the obligations guaranteed hereby is rescinded or otherwise must be restored or returned by Bank (whether as a preference, fraudulent conveyance or otherwise) upon or in connection with the insolvency, bankruptcy, dissolution, liquidation or reorganization of Borrower, Leasehold Owner, Guarantor or any other person, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, Borrower, Leasehold Owner, Guarantor or any other person or for a substantial part of Borrower’s, Leasehold Owner’s Guarantor’s or any of such other person’s property, as the case may be, or otherwise, all as though such payment had not been made.  Guarantor further agrees that in the event any such 

 

5

 

payment is rescinded or must be restored or returned, all costs and reasonable expenses (including, without limitation, reasonable legal fees and expenses) incurred by or on behalf of Bank in defending or enforcing such continuance or reinstatement, as the case may be, shall constitute costs of enforcement, the payment of which is guaranteed by Guarantor pursuant to Paragraph 2 above and covered by Guarantor’s indemnity pursuant to Paragraph 7 above.

 

9.                                       Litigation, Compliance with Judgments.  Each Guarantor represents and warrants with respect to itself that as of the date hereof there are no actions, suits or proceedings pending or, to the best of Guarantor’s knowledge, threatened in writing against or affecting such Guarantor, at law, in equity or before or by any governmental authorities which would have a material effect on such Guarantor’s ability to perform his obligations hereunder.  To the best of Guarantor’s knowledge, Guarantor is not in default with respect to any order, writ, injunction, decree or demand of any court or governmental authorities.

 

10.                                 Authorization and Enforceability; No Conflicts.  As of the date hereof each Guarantor has the full power and authority to enter into and perform its obligations under this Guaranty and this Guaranty is a legal, valid and binding instrument, enforceable against Guarantor in accordance with its terms.  The execution, delivery and performance of this Guaranty has been authorized by all proper and necessary actions of the Guarantor.   Each Guarantor represents and warrants with respect to itself and to its knowledge that the consummation of the transactions contemplated hereby and the performance of this Guaranty and the other Loan Documents to which such Guarantor is a party have not resulted and will not result in any breach of, or constitute a default under, any mortgage, deed of trust, lease, bank loan or credit agreement, corporate charter, by-laws, partnership agreement or other instrument to which such Guarantor is a party or by which such Guarantor may be bound or affected.

 

11.                                 Compliance with Laws.  As of the date hereof, each Guarantor represents and warrants with respect to itself and to its knowledge that such Guarantor is in compliance with, and the transactions contemplated by the Loan Documents and this Guaranty do not and will not violate any provision of, or require any filing, registration, consent or approval under, any federal, state or local law, rule, regulation, ordinance, order, writ, judgment, injunction, decree, determination or award (hereinafter, “Laws”) presently in effect having applicability to such Guarantor.  Guarantor will comply promptly with all Laws now or hereafter in effect having applicability to Guarantor.

 

12.                                 Accuracy of Information; Full Disclosure.  As of the date hereof, each Guarantor represents and warrants with respect to itself and to its knowledge neither this Guaranty nor any documents, financial statements, reports, notices, schedules, certificates, statements or other writings furnished by or on behalf of Guarantor to Bank in connection with the negotiation of the Loan Documents or the consummation of the transactions contemplated thereby, or required herein or by the other Loan Documents to be furnished by or on behalf of Guarantor, contains any untrue or misleading statement of a material fact; there is no fact which Guarantor has not disclosed to Bank in writing which materially affects adversely any of the property covered by the Mortgage or the business affairs or financial condition of Guarantor, or the ability of Guarantor to perform this Guaranty and the other Loan Documents to which Guarantor is a party.

 

6

 

13.                                 Financial Statements. Each Guarantor represents, warrants and covenants with respect to itself as follows:

 

(a)                      The most recent financial statements heretofore delivered by Guarantor to Bank are true and correct in all respects, have been prepared in accordance with sound accounting principles consistently applied and fairly present Guarantor’s financial condition as of the date thereof including detailed information on all real estate holdings of the Guarantor and its subsidiaries, and no material adverse change has occurred in the financial condition reflected therein since the date thereof.

 

(b)                     Guarantor shall deliver to Bank annually, as soon as available, but in any event within one hundred twenty (120) days after the last day of its fiscal year, a balance sheet of the Guarantor and its subsidiaries, as of such last day of the fiscal year, and statements of income and retained earnings and cash flow for such fiscal year, each prepared in accordance with sound accounting principles consistently applied, in reasonable detail, including detailed information on all real estate holdings of the Guarantor and its subsidiaries.

 

(c)                      Guarantor shall deliver to Bank each tax return of the Guarantor within forty-five (45) days after the submission thereof to the applicable taxing authority.

 

(d)                     Promptly after a written request therefor, Guarantor shall deliver to Bank such other financial data or information as the Bank may reasonably request from time to time.

 

14.                                 Mechanics’ Liens.  If Leasehold Owner and/or Guarantor shall have completed or caused the Substantial Completion of the construction and equipping of the Improvements on or before the Completion Date, free and clear of all liens and defects in construction and materials,  materially in accordance with all Plans (as the same may be modified pursuant to the terms of the Loan Documents), Laws and the Building Loan Agreement, and satisfied the conditions set forth in the Building Loan Agreement and Guarantor shall have otherwise satisfied any and all of its obligations under this Guaranty, then upon the expiration of any time period beyond said completion of the construction and equipping of the Improvements in accordance with the Building Loan Agreement within which mechanics, materialmen or other Persons (collectively, “Mechanics”) are entitled to file liens against the Premises for construction, materials or related work claims shall have expired (such completion and the expiration of such time period, is herein referred to as the “Completion of the Project”), Guarantor shall be released of any further obligations under this Guaranty; provided, however, if Bank shall have received after Completion of the Project, duly executed lien waivers from all Mechanics entitled to file liens against the Premises evidencing the payment in full for all of their work relating to the Premises, this Guaranty shall terminate upon receipt of such lien waivers.  Bank agrees that upon Bank’s receipt of evidence satisfactory to Bank of the Completion of the Project, and, provided, that no undischarged liens which have not been bonded over shall have been filed against the Premises by Mechanics, Bank shall deliver a written confirmation that this Guaranty is limited only to a guaranty against the filing of subsequent liens against the Premises by Mechanics with respect to which such duly executed lien waivers have not been received by Bank.  Thereafter, this Guaranty shall continue as a guaranty against claims and liens by Mechanics that have not been waived until Mechanics are no longer legally entitled to file any such claims or liens against the Premises, whereupon Bank 

 

7

 

shall deliver to Guarantor Bank’s final written confirmation of termination of this Guaranty in full, provided that no undischarged Mechanics’ liens have been filed against the Premises.

 

15.                                 ADA Indemnification.  Guarantor hereby agrees to indemnify and hold Bank, their respective successors and assigns and their respective members, officers, directors, employees, agents, representatives, contractors, subcontractors and attorneys harmless against any and all claims, suits, actions, proceedings, damages, expenses, demands, losses, costs, fines or liabilities of whatever kind or nature (including, without limitation, arising from personal injury, death or property damage) in any way related to or arising out of the violation or non-compliance by Leasehold Owner with, or Leasehold Owner’s failure to use reasonable efforts to cause any person or entity operating, leasing, subleasing, possessing, using or controlling all or any portion of the Premises to comply with, any applicable federal, state or local law, rule, regulation or order related to the Americans with Disabilities Act of 1990 (42 U.S.C.A. § 12101 et seq.), as amended from time to time.

 

16.                                 Non-Waiver Remedies Cumulative.  No failure or delay on Bank’s part in exercising any right, power or privilege under any of the Loan Documents, this Guaranty or any other document made to or with Bank in connection with the Bonds shall operate as a waiver of any such privilege, power or right or shall be deemed to constitute Bank’s acquiescence in any default by Borrower or Guarantor under any of said documents.  A waiver by Bank of any right or remedy under any of the Loan Documents, this Guaranty or any other document made to or with Bank in connection with the Bonds on any one occasion shall not be construed as a bar to any right or remedy which Bank otherwise would have on any future occasion.  The rights and remedies provided in said documents are cumulative, may be exercised singly or concurrently and are not exclusive of any rights or remedies provided by law.

 

17.                                 Transfers of Interests in Bonds.  Guarantor acknowledges that Bank, at Bank’s sole discretion, may sell, assign or transfer interests in the Bonds, this Guaranty and the other Loan Documents to one or more purchasers and/or assignees and agrees in connection therewith, all Loan Documents and other documentation, financial statements, appraisals and other data, or copies thereof, relevant to Borrower, Guarantor, the Premises, the Project or the Bond Agreement, may be provided to and retained by any such purchaser or assignee or prospective purchaser or assignee.  Guarantor agrees that Bank shall have no obligation to give Guarantor written notice of any sale, assignment or transfer of any interest in the Bonds or any part thereof.

 

18.                                 Separate Indemnity.  Guarantor acknowledges and agrees that Bank’s rights (and Guarantor’s obligations) under this Guaranty shall be in addition to all of Bank’s rights (and all of Guarantor’s obligations) under any indemnity agreement executed and delivered to Bank by Borrower and/or Guarantor in connection with the Bonds, and payments by Guarantor under this Guaranty shall not reduce any of Guarantor’s obligations and liabilities under any such indemnity agreement.

 

19.                                 Severability.  Any provision of this Guaranty, or the application thereof to any person or circumstance, which, for any reason, in whole or in part, is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions of this Guaranty 

 

8

 

(or the remaining portions of such provision) or the application thereof to any other person or circumstance, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision (or portion thereof) or the application thereof to any person or circumstance in any other jurisdiction.

 

20.                                 Entire Agreement; Amendments.  This Guaranty contains the entire agreement of the parties with respect to the subject matter hereof and supersedes all prior oral or written agreements or statements relating to such subject matter, and none of the terms and provisions hereof may be waived, amended or terminated except by a written instrument signed by the Person against whom enforcement of the waiver, amendment or termination is sought.

 

21.                                 Successors and Assigns.  This Guaranty shall be binding upon and shall inure to the benefit of Bank and Guarantor and their respective heirs, personal representatives, successors and assigns.  This Guaranty may be assigned by Bank with respect to all or any portion of the obligations guaranteed hereby, and when so assigned Guarantor shall be liable under this Guaranty to the assignee(s) of the portion(s) of the obligations guaranteed hereby so assigned without in any manner affecting the liability of Guarantor hereunder to Bank with respect to any portion of the obligations guaranteed hereby retained by Bank.

 

22.                                 WAIVER OF TRIAL BY JURY.  GUARANTOR, AND BY ITS ACCEPTANCE HEREOF, BANK, EACH HEREBY AGREES NOT TO ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVE ANY RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST WITH REGARD TO THE 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 BANK, AND IS INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY JURY WOULD OTHERWISE ACCRUE.  GUARANTOR AND BANK ARE EACH HEREBY AUTHORIZED TO FILE A COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER.

 

23.                                 ADDITIONAL WAIVERS IN THE EVENT OF ENFORCEMENT. GUARANTOR HEREBY EXPRESSLY AND UNCONDITIONALLY WAIVES, IN CONNECTION WITH ANY SUIT, ACTION OR PROCEEDING BROUGHT BY OR ON BEHALF OF BANK ON THIS GUARANTY, ANY AND EVERY RIGHT GUARANTOR MAY HAVE TO (I) INJUNCTIVE RELIEF, (II) INTERPOSE ANY COUNTERCLAIM THEREIN (OTHER THAN COMPULSORY COUNTERCLAIMS), AND (III) HAVE THE SAME CONSOLIDATED WITH ANY OTHER OR SEPARATE SUIT, ACTION OR PROCEEDING.  NOTHING HEREIN CONTAINED SHALL PREVENT OR PROHIBIT GUARANTOR FROM INSTITUTING OR MAINTAINING A SEPARATE ACTION AGAINST BANK WITH RESPECT TO ANY ASSERTED CLAIM.

 

24.                                 Governing Law; Submission to Jurisdiction.  This Guaranty and the rights and obligations of the parties hereunder shall in all respects be governed by, and construed and enforced in accordance with, the laws of the State of New Jersey (without giving effect to New Jersey’s principles of conflicts of law).  Guarantor hereby irrevocably submits to the 

 

9

 

nonexclusive jurisdiction of any New Jersey State or Federal court sitting in the County of Essex  over any suit, action or proceeding arising out of or relating to this Guaranty, and Guarantor hereby 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 in any New Jersey State or Federal court sitting in the County of Essex may be made by certified or registered mail, return receipt requested, directed to the Guarantor at the address indicated below, with a copy to its counsel at the address set forth in Section 26 hereof, and service so made shall be complete five (5) days after the same shall have been so mailed.

 

25.                                 Paragraph Headings.  Any paragraph headings and captions in this Guaranty are for convenience only and shall not affect the interpretation or construction hereof.

 

26.                                 Liability Unaffected by Release.  Any other Person liable upon or in respect of any obligation hereby guaranteed, may be released without affecting the liability of Guarantor hereunder.

 

27.                                 Joint and Several Obligations.  If more than one Person comprises Guarantor, then each such Person’s obligations and liability under this Guaranty shall be joint and several.

 

28.                                 Notices.  Notices shall be given in the manner provided in the Bond Agreement and with respect to Guarantor at the address set forth below, with a copy of any such Notice to be given to Herrick Feinstein LLP, 2 Park Avenue, New York, NY, Attention:  Laurie A. Grasso, Esq., Facsimile No.:  (212) 545-3343.

 

29.                                 Counterparts. This Guaranty may be executed in any number of counterparts, each of which shall be an original and all of which shall constitute together but one and the same agreement.

 

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

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

 

10

 

[SIGNATURE PAGE TO GUARANTY OF COMPLETION]

 

IN WITNESS WHEREOF, Guarantor and Borrower have each caused this Guaranty to be duly executed and delivered by its respective duly authorized official as of the date first above stated.

 

	
 
    	
RBH-TRB   NEWARK HOLDINGS, LLC
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
RBH   Capital LLC, its Manager
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   Ron Beit-Halachmy
    
	
 
    	
 
    	
 
    	
Name:   Ron Beit-Halachmy
    
	
 
    	
 
    	
 
    	
Title:   Authorized Signatory
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
RBH-TRB   EAST MEZZ URBAN RENEWAL ENTITY, LLC
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Ron Beit-Halachmy
    
	
 
    	
 
    	
Name:
    	
Ron   Beit-Halachmy
    
	
 
    	
 
    	
Title:
    	
Authorized   Signatory
    
					

 

 

	
STATE   OF NEW JERSEY
    	
:
    
	
 
    	
SS.:
    
	
COUNTY   OF ESSEX
    	
:
    

 

I CERTIFY that on February       , 2012, Ron Beit-Halachmy personally came before me and acknowledged under oath, to my satisfaction, that this person (or if more that one, each person):

 

(a) is named in and personally signed this document; and

(b) signed, sealed and delivered this document as his or her act and deed.

	
 
    	
 
    
	
 
    	
 
    
	
 
    	
NOTARY   PUBLIC OF NEW JERSEY
    
	
 
    	
 
    
	
 
    	
 
    
	
STATE   OF NEW JERSEY
    	
:
    
	
 
    	
SS.:
    
	
COUNTY   OF ESSEX
    	
:
    
			

 

I CERTIFY that on February       , 2012, Ron Beit-Halachmy personally came before me and acknowledged under oath, to my satisfaction, that this person (or if more that one, each person):

 

(a) is named in and personally signed this document; and

(b) signed, sealed and delivered this document as his or her act and deed.

 

	
 
    	
 
    
	
 
    	
NOTARY   PUBLIC OF NEW JERSEYExhibit 10.6

 

WMLM

101695/207

Execution

 

SECURITY AGREEMENT

 

This Security Agreement (“Agreement”) is dated this 3rd day of February, 2012, by and between RBH-TRB EAST MEZZ URBAN RENEWAL ENTITY, LLC (“Debtor”),  a New Jersey limited liability company, and TD BANK, N.A., a national banking association (“Lender”).

 

BACKGROUND

 

WHEREAS, pursuant to the Ground Lease by and between Debtor and Teachers Village School QALICB Urban Renewal, LLC (the “Leasehold Owner”), the Leasehold Owner is obligated to, among other things, (i) improve by constructing structures and related amenities on the Premises (defined herein) and (ii) assign to the Debtor all of its right, title and interest in the Pledged Deposit Accounts (as such term is defined herein), which are held pursuant to the terms of the Intercreditor Agreement and which the Debtor has a security interest pursuant to the terms of the Deposit Account Security Agreement dated as of the date hereof by Leasehold Owner in favor of Debtor, as the same may be amended, restated, modified or supplemented from time to time (the “Deposit Account Security Agreement”);

 

WHEREAS, Debtor will derive substantial benefit from the transactions contemplated by that certain Bond Agreement dated as of December 1, 2011 by and among Debtor, Lender and the New Jersey Economic Development Authority (the “Issuer”)  (as the same may be amended, restated, modified or supplemented, the “Bond Agreement”);

 

WHEREAS, pursuant to the Bond Agreement, the Issuer issued $22,748,000 of its Qualified School Construction Bonds (the “Bonds”),  which were purchased by the Lender pursuant to the Bond Agreement; and

 

WHEREAS, as additional security for the full, timely and faithful repayment of the Bonds and the performance by Debtor of all of its obligations under the Bond Documents, (the “Obligations”), the Lender requires that the Debtor execute and deliver this Agreement for the benefit of the Lender.

 

NOW, THEREFORE, the parties hereto, intending to be legally bound, and for good and valuable consideration, the receipt and sufficiency of which are acknowledged, hereby agree as follows:

 

SECTION 1.         DEFINITIONS AND INTERPRETATION

 

1.1          Terms Defined: As used in this Agreement, the following terms have the following respective meanings:

 

Account - All of the “accounts” (as that term is defined in the UCC) of Debtor, whether now existing or hereafter arising.

 

1

 

Account Debtor - Any Person obligated on any Account owing to Debtor.

 

Affiliate - With respect to any Person, (a) any Person which, directly or indirectly through one or more intermediaries controls, or is controlled by, or is under common control with, such Person, or (b) any Person who is a director or officer (i) of such Person, (ii) of any subsidiary of such Person, or (iii) any person described in clause (a) above.  For purposes of this definition, control of a Person shall mean the power, direct or indirect, (x) to vote 5% or more of the Capital Stock having ordinary voting power for the election of directors (or comparable equivalent) of such Person, or (y) to direct or cause the direction of the management and policies of such Person whether by contract or otherwise.  Control may be by ownership, contract, or otherwise.

 

Assignment of Claims Act — The Federal Assignment of Claims Act, 31 U.S.C. § 3727 et  seq., as amended from time to time.

 

Assignment of Contracts — Assignment of Contracts, Licenses and Permits dated as of the date hereof by Leasehold Owner to Debtor, as the same may be amended, restated, modified or supplemented from time to time.

 

Assignment of Leases — The Absolute Assignment of Leases and Rents dated as of the date hereof by Leasehold Owner to Debtor, as the same may be amended, restated, modified or supplemented from time to time.

 

Bond Documents — Collectively, the Bond Agreement, the Loan Documents and the Collateral Documents.

 

Business Day - A day other than Saturday or Sunday when Lender is open for business in New York, New York.

 

Capital Stock - Any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all other ownership interests in a Person (other than a corporation) and any and all warrants or options to purchase any of the foregoing.

 

Cash Management Agreement — The Cash Management Agreement dated as of the date hereof by and among the Debtor, the Leasehold Owner, the Subordinate Lender, GS Halsey NMTC Investment Fund LLC, NJCC CDE Essex LLC, Gateway SUB-CDE I, LLC and Lender as the same may be amended, restated, modified or supplemented from time to time.

 

Collateral - All of the Property and interests in Property described in Section 2.1 of this Agreement and all other and interests in Property that now or hereafter secure payment of the Obligations and satisfaction by Debtor of all covenants and undertakings contained in this Agreement and the other Bond Documents.

 

Collateral Documents — The “Collateral Documents”, as defined in the Bond Agreement.

 

2

 

Construction Fund Proceeds — The Construction Fund Proceeds”, as such term is defined in the Intercreditor Agreement.

 

Construction Proceeds — The Construction Fund Proceeds pledged to Debtor by Leasehold Owner pursuant to the terms of the Ground Lease and the Deposit Account Security Agreement.

 

Default - Any event, act, condition or occurrence which with notice, or lapse of time or both, would constitute an Event of Default hereunder.

 

Event of Default - As defined in Section 5.1.

 

Excluded Property — Collectively, the Capitalized Interest Account #2, Capitalized Interest Account #3, RAB Capitalized Interest Account and the CDBG Account (all as such terms are defined in the Intercreditor Agreement).

 

Expenses - Section 6.6.

 

Governmental Authority - Any federal, state or local government or political subdivision, or any agency, authority, bureau, central bank, commission, department or instrumentality of either, or any court, tribunal, grand jury, or arbitration.

 

Intercreditor Agreement — The Intercreditor, Escrow and Disbursement Agreement dated as of the date hereof, among Debtor, the Leasehold Owner, the Lender, the Subordinate Lender, GS Halsey NMTC Investment Fund LLC, NJCC CDE Essex LLC and Gateway Sub-CDE, I, LLC, as the same may be amended, restated, modified or supplemented from time to time.

 

Inventory - All of the “inventory” (as that term is defined in the UCC) of Debtor, whether now existing or hereafter acquired or created.

 

Lien - Any interest of any kind or nature in property securing an obligation owed to, or a claim of any kind or nature in property by, a Person other than the owner of the Property, whether such interest is based on the common law, statute, regulation or contract, and including, but not limited to, a security interest or lien arising from a mortgage, encumbrance, pledge, conditional sale or trust receipt, a lease, consignment or bailment for security purposes, a trust, an escrow or an assignment.  For the purposes of this Agreement, Debtor shall be deemed to be the owner of any Property which it has acquired or holds subject to a conditional sale agreement or other arrangement pursuant to which title to the Property has been retained by or vested in some other Person for security purposes.

 

Loan Documents – The “Loan Documents” as defined in the Bond Agreement.

 

Obligations - All existing and future debts, liabilities and obligations of every kind or nature at any time owing by Debtor to Lender or any other subsidiary of Lender or Lender Affiliate whether under this Agreement, or any other existing or future instrument, document or agreement, between Debtor and Lender or any other subsidiary of Lender or Lender

 

3

 

Affiliate, whether joint or several, related or unrelated, primary or secondary, matured or contingent, due or to become due (including debts, liabilities and obligations obtained by assignment), and whether principal, interest, fees, indemnification obligations hereunder or Expenses (specifically including interest accruing after the commencement of any bankruptcy, insolvency or similar proceeding with respect to Debtor, whether or not a claim for such post-commencement interest is allowed), including, without limitation, debts, liabilities and obligations in respect of the Bonds and the Bond Documents and any extensions, modifications, substitutions, increases and renewals thereof; the payment of all amounts advanced by Lender or any other subsidiary of Lender or Bank Affiliate to preserve, protect and enforce rights hereunder and in the Collateral; and all Expenses incurred by Lender or any other subsidiary of Lender or Bank Affiliate.  Without limiting the generality of the foregoing, Obligations shall include any other debts, liabilities or obligations owing to Lender or any other subsidiary of Lender or Bank Affiliate in connection with any lockbox, cash management, or other services (including electronic funds transfers or automated clearing house transactions) provided by Lender or any other subsidiary of Lender or Bank Affiliate to Debtor.

 

Permitted Liens— Permitted Liens as further detailed in Section 3.3 and Schedule 3.3.

 

Person - An individual, partnership, corporation, trust, limited liability company, limited liability partnership, unincorporated association or organization, joint venture or any other entity.

 

Pledged Deposit Accounts — all the accounts set forth on Exhibit A hereto and made a part hereof.

 

Premises- All of that certain premises located in the City of Newark, County of Essex and State of New Jersey, more particularly described in the Bond Documents.

 

Property - Any interest of Debtor in any kind of personal property, whether tangible or intangible.

 

Subordinate Lender — Collectively, Casino Reinvestment Development Authority and Brick City Development Corporation.

 

“Subordination Agreements” - Collectively, each Subordination Agreement by and between Lender and each Subordinate Lender.

 

UCC - The Uniform Commercial Code as adopted in the State of New Jersey as the same may be amended from time to time.

 

Other Capitalized Terms - Any other capitalized terms used without further definition herein shall have the respective meaning set forth in the UCC.

 

1.2          Construction:    No doctrine of construction of ambiguities in agreements or instruments against the interests of the party controlling the drafting shall apply to any Bond Documents.

 

4

 

SECTION 2.         COLLATERAL

 

2.1          Collateral:   As security for the payment of the Obligations, and satisfaction by Debtor of all covenants and undertakings contained in this Agreement and the other Bond Documents, Debtor hereby assigns and grants to Lender, a continuing Lien on and security interest in, upon and to all assets of Debtor, including Debtor’s right, title and interest in, to the following Property, all whether now owned or hereafter acquired, created or arising and wherever located (excluding the Excluded Property) (collectively, the “Collateral”):

 

(1)             Accounts - All Accounts;

 

(2)             Chattel Paper - All Chattel Paper;

 

(3)             Documents - All Documents;

 

(4)             Instruments - All Instruments;

 

(5)             Inventory - All Inventory;

 

(6)             General Intangibles - All General Intangibles;

 

(7)             Equipment - All Equipment;

 

(8)             Fixtures - All Fixtures;

 

(9)             Deposit Accounts - All Deposit Accounts;

 

(10)          Goods - All Goods;

 

(11)          Letter of Credit Rights — All Letter of Credit Rights;

 

(12)          Supporting Obligations — All Supporting Obligations;

 

(13)          Investment Property - All Investment Property;

 

(14)          Commercial Tort Claims — All Commercial Tort Claims, provided that Lender acknowledges that the attachment of its security interest in any commercial tort claim as original collateral is subject to Debtor’s compliance with Section 4.4 of this Agreement;

 

(15)          Pledged Deposit Accounts — All Pledged Deposit Accounts;

 

(16)          Property in Lender’s Possession - All Property of Debtor, now or hereafter in Lender’s possession;

 

(17)          Construction Proceeds — The Construction Proceeds;

 

(18)          Leasehold Owner’s Assets - All of the Debtor’s right, title and interest in any asset of the Leasehold Owner including but not limited to that which is

 

5

 

granted to Debtor pursuant to the Deposit Account Security Agreement, Assignment of Leases and the Assignment of Contracts (collectively, the “Leasehold Owner’s Property”); and

 

(19)         Proceeds - The Proceeds (including, without limitation, insurance proceeds), whether cash or non-cash, of all of the foregoing property described in clauses (1) through (18).

 

2.2         Perfection of Security Interest:

 

Debtor shall execute and/or deliver to Lender, or cause to be executed and delivered (all in form and substance satisfactory to Lender and its counsel):

 

(a)           Financing statements pursuant to the UCC, which Lender may file in the jurisdiction where Debtor is organized and in any other jurisdiction that Lender deems appropriate; and

 

(b)           Any other agreements, documents, instruments and writings, including, without limitation, intellectual property security agreements, required by Lender to evidence, perfect or protect the Liens and security interests in the Collateral or as Lender may reasonably request from time to time.

 

2.3         Other Actions:

 

(a)           In addition to the foregoing, Debtor shall do anything further that may be reasonably required by Lender to secure Lender and effectuate the intentions and objects of this Agreement, including, without limitation, (i) the execution and delivery of security agreements, contracts, control agreements and any other documents required hereunder, including without limitation, Debtor shall cause Leasehold Owner to execute and deliver an account control agreement by and among Debtor, Leasehold Owner and TD Bank, N.A., as custodian, in connection with the Pledged Deposit Accounts and, (ii) with respect to amounts due to Debtor from the United States or any agency or instrumentality thereof, the execution and delivery of such documents as may be required to assign such amounts to Lender under the Assignment of Claims Act.  At Lender’s reasonable request, Debtor shall also immediately deliver (with execution by Debtor of all necessary documents or forms to reflect, implement or enforce the Liens described herein), or cause to be delivered to Lender all items for which Lender must receive possession to obtain a perfected security interest, including without limitation, all notes, stock powers, letters of credit, certificates and documents of title, Chattel Paper, Warehouse Receipts, Instruments, and any other similar instruments constituting Collateral.

 

(b)           Lender is hereby authorized to file financing statements and amendments to financing statements without Debtor’s signature, in accordance with the UCC.  Debtor hereby authorizes Lender to file all such financing statements and amendments to financing statements describing the Collateral in any filing office as Lender, in its sole discretion may determine, including financing statements listing “All Assets” in the collateral description therein, excluding however, the Excluded Property.  Debtor agrees to comply with the requests of Lender in order for Lender to have and maintain a valid and perfected first security interest in the Collateral including, without limitation, executing and causing any other Person to execute such documents

 

6

 

as Lender may require to obtain Control (as defined in the UCC) over all Deposit Accounts, including, without limitation, the Pledged Deposit Accounts, Letter of Credit Rights and Investment Property.

 

2.4          Searches, Certificates:

 

(a)           Lender may from time to time, at Debtor’s expense, obtain the following searches (the results of which are to be consistent with the warranties made by Debtor in this Agreement):

 

(1)           UCC searches with the Secretary of State and local filing office of each state where Debtor is organized, maintains its executive office, a place of business, or assets; and

 

(2)           Judgment, state and federal tax lien and corporate tax lien searches, in all applicable filing offices of each state searched under subparagraph (1) above.

 

(b)           Debtor shall obtain and deliver to Lender good standing certificates showing Debtor to be in good standing in its state of organization and in each other state in which it is doing and presently intends to do business for which qualification is required.

 

2.5          Intentionally Omitted.

 

2.6          Filing Security Agreement: A carbon, photographic or other reproduction or other copy of this Agreement or of a financing statement is sufficient as and may be filed in lieu of a financing statement.

 

2.7          Power of Attorney: Each of the officers of Lender is hereby irrevocably made, constituted and appointed the true and lawful attorney for Debtor during such time as any Obligations are outstanding (without requiring any of them to act as such) with full power of substitution to do the following: (a) endorse the name of Debtor upon any and all checks, drafts, money orders and other instruments for the payment of monies that are payable to Debtor and constitute collections on Debtor’s Accounts or proceeds of other Collateral; (b) execute and/or file in the name of Debtor any financing statements, schedules, assignments, instruments, documents and statements that Debtor is obligated to give Lender hereunder or is necessary to perfect (or continue or evidence the perfection of such security interest or Lien) Lender’s security interest or Lien in the Collateral; and (c) during the continuance of an Event of Default, do such other and further acts and deeds in the name of Debtor that Lender may reasonably deem necessary or desirable to enforce any Account or other Collateral.

 

SECTION 3.         REPRESENTATIONS AND WARRANTIES

 

To induce Lender to purchase the Bonds, Debtor warrants and represents to Lender that: 

 

3.1          Validity:

 

(a)             Intentionally Omitted.

 

7

 

(b)             The making and performance of this Agreement and the other Bond Documents will not violate any law, government rule or regulation, court or administrative order or other such order, or any of the provisions of Debtor’s organizational documents, or violate or result in a default (immediately or with the passage of time) under any contract, agreement or instrument to which Debtor is a party, or by which Debtor is bound.

 

(c)             Debtor has all requisite power and authority to enter into and perform this Agreement and to incur the obligations herein provided for, and has taken all proper and necessary action to authorize the execution, delivery and performance of this Agreement.

 

(d)             This Agreement is valid and binding upon Debtor, and enforceable in accordance with its terms except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles.

 

3.2          Places of Business: The only places of business of Debtor, and the places where Debtor keeps and intends to keep its Property, are at the Premises or at the address of the Debtor set forth in Section 6.7 of this Agreement.

 

3.3          Title to Properties: Debtor has good and marketable title in fee simple (or its equivalent under applicable law) to all the Property it purports to own, free from Liens and free from the claims of any other Person, except for Permitted Liens as shown on Schedule 3.3. No other Person has control of any of the Collateral.

 

3.4          Governmental Authorizations; Consents: No authorization, approval or other action by, and no notice to or filing with, any domestic or foreign governmental authority or regulatory body or consent of any other person is required for (a) the grant by Debtor of the security interests granted hereby or for the execution, delivery or performance of this Agreement by Debtor; or (b) the perfection of the security interests granted hereby and pursuant to any other Bond Documents (except for the filing of UCC financing statements with the appropriate jurisdiction); or (c) the exercise by Lender of its rights and remedies hereunder.

 

3.5          Intentionally Omitted.

 

3.6          Names and Intellectual Property: Except as otherwise disclosed to Lender in writing, Debtor has not conducted business under or used any other name (whether corporate or assumed).  Debtor is the sole owner of all such names and any and all business done and all invoices issued in such trade names are Debtor’s sales, business and invoices.  The chief executive office and mailing address of Debtor is presently located at 89 Market Street, 8th Floor, Newark, New Jersey 07102.  The exact legal name of Debtor is that indicated on the signature page hereof.  Debtor is an organization of the type, and is organized in the jurisdiction set forth herein.

 

3.7          Intentionally Omitted.

 

3.8          Perfection and Priority: This Agreement is effective to create in favor of Lender legal, valid and enforceable Liens in all right, title and interest of Debtor in the Collateral, and when financing statements have been filed in the offices of the jurisdictions shown on Schedule

 

8

 

3.8 attached hereto and made part hereof under Debtor’s name, Debtor will have granted to Lender, and Lender will have perfected first priority Liens in the Collateral, superior in right to any and all other Liens, existing or future.

 

SECTION 4.         COVENANTS 

 

Debtor covenants that:

 

4.1          Payment of Taxes and Claims: Debtor shall pay and shall cause Leasehold Owner to pay, as applicable, before they become delinquent, all taxes, assessments and governmental charges, or levies imposed upon it, or upon Debtor’s Property, and all claims or demands of materialmen, mechanics, carriers, warehousemen, landlords and other Persons, entitled to the benefit of statutory or common law Liens which, in any case, if unpaid, would result in the imposition of a Lien upon its Property; provided however, that Debtor shall not be required to pay any such tax, assessment, charge, levy, claim or demand if the amount, applicability or validity thereof, shall at the time, be contested in good faith and by appropriate proceedings by Debtor, and if Debtor shall have set aside on its books adequate reserves in respect thereof, if so required in accordance with GAAP; which deferment of payment is permissible so long as no Lien other than a Permitted Lien has been entered and Debtor’s title to, and its right to use, its Property are not materially adversely affected thereby.

 

4.2          Maintenance of Properties: Debtor shall, and shall cause Leasehold Owner, to maintain its respective Property in good condition (normal wear and tear excepted) make all necessary renewals, replacements, additions, betterments and improvements thereto and will pay and discharge when due the cost of repairs and maintenance to its Property, and will pay all rentals when due for all real estate leased by Debtor.

 

4.3          Places of Business: Debtor shall give thirty (30) days prior written notice to Lender of any changes in the location of any of its respective places of business, of the places where records concerning its Accounts or where its Inventory are kept, or the establishment of any new, or the discontinuance of any existing place of business.

 

4.4          Commercial Tort Claims: Debtor will immediately notify Lender in writing in the event that Debtor or Leasehold Owner, becomes a party to or obtains any rights with respect to any Commercial Tort Claim.  Such notification shall include information sufficient to describe such Commercial Tort Claim, including, but not limited to, the parties to the claim, the court in which the claim was commenced, the docket number assigned to such claim, if any, and a detailed explanation of the events that gave rise to the claim.  Debtor shall, and shall cause Leasehold Owner, to execute and deliver to Lender all documents and/or agreements necessary to grant Lender a security interest in such Commercial Tort Claim to secure the Obligations.  Debtor authorizes Lender to file (without Debtor’s signature) initial financing statements or amendments, as Lender deems necessary to perfect its security interest in the Commercial Tort Claim.

 

4.5          Letter of Credit Rights: Debtor shall provide Lender with written notice of any Letters of Credit for which Debtor or Leasehold Owner is the beneficiary.  Debtor shall execute and deliver (or cause to be executed or delivered) to Lender, all documents and agreements as

 

9

 

Lender may require in order to obtain and perfect its security interest in such Letter of Credit Rights.

 

4.6         Intentionally Omitted.

 

4.7          Liens and Encumbrances: Debtor shall not and shall not permit Leasehold Owner to: (i) execute a negative pledge agreement with any Person covering any of its respective Property, or (ii) cause or permit or agree or consent to cause or permit in the future (upon the happening of a contingency or otherwise), its respective Property (including, without limitation, the Collateral), whether now owned or hereafter acquired, to be subject to a Lien or be subject to any claim except for Permitted Liens.

 

4.8          Jurisdiction of Organization: Without providing at least 30 days’ prior written notice to Lender, Debtor shall not change its name, its type of organization, jurisdiction of organization or other legal structure, its place of business or, if more than one, chief executive office, or its mailing address or organizational identification number if it has one.

 

SECTION 5.         DEFAULT

 

5.1          Events of Default: Each of the following events shall constitute an event of default (“Event of Default”):

 

(a)             Payments - if Debtor fails to make any payment of principal interest, charges, fees, Expenses or other monetary obligations owing to Lender on the date such payment is due and payable; or

 

(b)             Particular Covenant Defaults - if Debtor fails to perform, comply with or observe any covenant or undertaking contained in this Agreement; or

 

(c)             Warranties or Representations - if any warranty, representation or other statement by or on behalf of Debtor contained in or pursuant to this Agreement is false, erroneous, or misleading in any material respect when made; or

 

(d)             Other Agreements - if Debtor breaches or violates the terms of, or if a default (and expiration of any applicable cure period), or an Event of Default occurs and is continuing under any Bond Document or the Ground Lease; or

 

(e)             Liens - if any Lien in favor of Lender shall cease to be valid, enforceable and perfected and prior to all other Liens other than Permitted Liens or if Debtor or any Governmental Authority shall assert any of the foregoing.

 

5.2          Cure:    Nothing contained in this Agreement or the Bond Documents shall be deemed to compel Lender to accept a cure of any Event of Default hereunder.

 

5.3          Rights and Remedies on Default:

 

(a)           In addition to all other rights, options and remedies granted or available to Lender under this Agreement or the Bond Documents (each of which is also then exercisable by

 

10

 

Lender), or otherwise available at law or in equity, upon or at any time after the occurrence and during the continuance of an Event of Default Lender may, in its discretion, terminate any obligation to extend credit to Debtor and declare all Obligations immediately due and payable, all without demand, notice, presentment or protest or further action of any kind.

 

(b)           Intentionally Omitted.

 

(c)           In addition to all other rights, options and remedies granted or available to Lender under this Agreement or the Bond Documents (each of which is also then exercisable by Lender), or otherwise available at law or in equity, upon or at any time after the acceleration of the Obligations following the occurrence of an Event of Default, Lender may, in its discretion, exercise all rights under the UCC and any other applicable law or in equity, and under all Bond Documents permitted to be exercised after the occurrence of an Event of Default, including the following rights and remedies (which list is given by way of example and is not intended to be an exhaustive list of all such rights and remedies):

 

(1)         The right to take possession of, send notices regarding and collect directly the Collateral, with or without judicial process (including without limitation the right to notify the United States postal authorities to redirect mail addressed to Debtor to an address designated by Lender); or

 

(2)         By its own means or with judicial assistance, enter Debtor’s premises and take possession of the Collateral, or render it unusable, or dispose of the Collateral on such premises in compliance with subsection (e) below, without any liability for rent, storage, utilities or other sums, and Debtor shall not resist or interfere with such action; or

 

(3)         Require Debtor at Debtor’s expense to assemble all or any part of the Collateral (other than real estate or fixtures) and make it available to Lender at any place designated by Lender.

 

(d)           In addition to all other rights, options and remedies granted or available to Lender under this Agreement or the Bond Documents (each of which is also then exercisable by Lender), or otherwise available at law or in equity, upon or at any time after the occurrence and during the continuance of an Event of Default, Debtor shall, at the request of Lender, notify Account Debtors and other persons obligated on any of the Collateral of the security interest of Debtor in any Account, Chattel Paper, General Intangible, Instrument or other Collateral and that payment thereof is to be made directly to Lender or to any financial institution designated by Lender as Lender’s agent therefor, and Lender may itself, without notice to or demand upon Debtor, so notify Account Debtors and other persons obligated on Collateral.  After the making of such a request or the giving of any such notification, Debtor shall hold any proceeds of collection of Accounts, Chattel Paper, General Intangibles, Instruments and other Collateral received by Debtor as trustee for Lender without commingling the same with other funds of Debtor and shall turn the same over to Lender in the identical form received, together with any necessary endorsements or assignments.  Lender shall apply the proceeds of collection of Accounts, Chattel Paper, General Intangibles, Instruments and other Collateral received by

 

11

 

Lender to the Obligations, such proceeds to be immediately entered after final payment in cash or other immediately available funds of the items giving rise to them.

 

(e)           Debtor hereby agrees that a notice received by it at least seven (7) days before the time of any intended public sale or of the time after which any private sale or other disposition of the Collateral is to be made, shall be deemed to be reasonable notice of such sale or other disposition.  If permitted by applicable law, any perishable inventory or Collateral which threatens to speedily decline in value or which is sold on a recognized market may be sold immediately by Lender without prior notice to Debtor.  Debtor covenants and agrees not to interfere with or impose any obstacle to Lender’s exercise of its rights and remedies with respect to the Collateral, after the occurrence of an Event of Default hereunder.  Lender shall have no obligation to clean up or prepare the Collateral for sale.  If Lender sells any of the Collateral upon credit, Debtor will only be credited with payments actually made by the purchaser thereof, that are received by Lender.  Lender may, in connection with any sale of the Collateral specifically disclaim any warranties of title or the like.

 

5.4          Nature of Remedies: All rights and remedies granted Lender hereunder and under the Bond Documents, or otherwise available at law or in equity, shall be deemed concurrent and cumulative, and not alternative remedies, and Lender may proceed with any number of remedies at the same time until all Obligations are satisfied in full.  The exercise of any one right or remedy shall not be deemed a waiver or release of any other right or remedy, and Lender, upon or at any time after the occurrence of an Event of Default, may proceed against Debtor, at any time, under any agreement, with any available remedy and in any order.

 

5.5         Set-Off:

 

In addition to all other rights, options and remedies granted or available to Lender under this Agreement or the Bond Documents (each of which is also then exercisable by Lender), upon or at any time after the occurrence and during the continuance of an Event of Default, Lender (and any participant) shall have and be deemed to have, without notice to Debtor, the immediate right of set-off against any bank account of Debtor with Lender or after exercising Lender’s rights with respect to the Deposit Account Security Agreement, any bank account of Leasehold Owner with Lender or with any other subsidiary of Lender or Lender Affiliate or any participant or assigned by the Leasehold Owner to the Debtor including, without limitation, the Pledged Deposit Accounts and may apply the funds or amount thus set-off against any of Debtor’s Obligations hereunder.

 

If any bank account of Debtor with Lender, any other subsidiary of Lender or Bank Affiliate or any participant is attached or otherwise liened or levied upon by any third party, Lender (and such participant) shall have and be deemed to have, without notice to Debtor, the immediate right of set-off and may apply the funds or amount thus set-off against any of Debtor’s Obligations hereunder.

 

SECTION 6.         MISCELLANEOUS

 

6.1          Governing Law:  THIS AGREEMENT AND ALL MATTERS ARISING OUT OF OR RELATING TO THIS AGREEMENT, AND ALL RELATED AGREEMENTS AND

 

12

 

DOCUMENTS, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE STATE OF NEW JERSEY.  THE PROVISIONS OF THIS AGREEMENT AND ALL OTHER AGREEMENTS AND DOCUMENTS REFERRED TO HEREIN ARE TO BE DEEMED SEVERABLE, AND THE INVALIDITY OR UNENFORCEABILITY OF ANY PROVISION SHALL NOT AFFECT OR IMPAIR THE REMAINING PROVISIONS WHICH SHALL CONTINUE IN FULL FORCE AND EFFECT.

 

6.2          Intentionally Omitted.

 

6.3          Waiver:  No omission or delay by Lender in exercising any right or power under this Agreement or any related agreements and documents will impair such right or power or be construed to be a waiver of any Default, or Event of Default or an acquiescence therein, and any single or partial exercise of any such right or power will not preclude other or further exercise thereof or the exercise of any other right, and as to Debtor no waiver will be valid unless in writing and signed by Lender and then only to the extent specified.

 

6.4          Indemnity.

 

(a)           Debtor releases and shall indemnify, defend and hold harmless Lender and its respective officers, employees and agents, of and from any claims, demands, liabilities, obligations, judgments, injuries, losses, damages and costs and expenses (including, without limitation, reasonable legal fees) resulting from (i) acts or conduct of Debtor under, pursuant or related to this Agreement and the other Bond Documents, (ii) Debtor’s breach or violation of any representation, warranty, covenant or undertaking contained in this Agreement or the other Bond Documents, and (iii) any claim by any other creditor of Debtor against Lender arising out of any transaction whether hereunder or in any way related to the Bond Documents and all costs, expenses, fines, penalties or other damages resulting therefrom, unless resulting solely from acts or conduct of Lender constituting willful misconduct or gross negligence.

 

(b)           Promptly after receipt by an indemnified party under subsection (a) above of notice of the commencement of any action by a third party, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify the indemnifying party in writing of the commencement thereof.  The omission so to notify the indemnifying party shall relieve the indemnifying party from any liability which it may have to any indemnified party under such subsection only if the indemnifying party is unable to defend such actions as a result of such failure to so notify.  In case any such action shall be brought against any indemnified party and it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnified party), and, after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party shall not be liable to such indemnified party under such subsection for any legal expenses of other counsel or any other expenses, in each case subsequently incurred by such indemnified party, in connection with the defense thereof other than reasonable costs of investigation.

 

13

 

6.5          Time: Whenever Debtor shall be required to make any payment, or perform any act, on a day which is not a Business Day, such payment may be made, or such act may be performed, on the next succeeding Business Day.  Time is of the essence in Debtor’s performance under all provisions of this Agreement and all related agreements and documents.

 

6.6          Expenses of Lender: Debtor will pay upon demand of Lender all reasonable costs, fees and expenses of Lender in connection with (i) the analysis, negotiation, preparation, execution, administration, delivery and termination of this Agreement, and other Bond Documents and the documents and instruments referred to herein and therein, and any amendment, amendment and restatement, supplement, waiver or consent relating hereto or thereto, whether or not any such amendment, amendment and restatement, supplement, waiver or consent is executed or becomes effective, search costs, the reasonable fees, expenses and disbursements of counsel for Lender, and reasonable charges of any expert consultant to Lender, (ii) the enforcement of Lender’s rights hereunder, or the collection of any payments owing from, Debtor under this Agreement and/or the other Bond Documents or the protection, preservation or defense of the rights of Lender hereunder and under the other Bond Documents, and (iii) any refinancing or restructuring of the credit arrangements provided under this Agreement and other Bond Documents in the nature of a “work-out” or of any insolvency or bankruptcy proceedings, or otherwise (including the reasonable fees and disbursements of counsel for Lender and, with respect to clauses (ii) and (iii), reasonable allocated costs of internal counsel) (collectively, the “Expenses”).

 

6.7          Notices:

 

(a)           Any notices or consents required or permitted by this Agreement shall be in writing and shall be deemed given if delivered in person to the person listed below or if sent by telecopy or by nationally recognized overnight courier, as follows, unless such address is changed by written notice hereunder:

 

	
If to Lender to: 
    	
TD Bank, N.A. 
   317 Madison Avenue 
   New York, New York 10017 
   Attention: Matthew Schatz, Vice President 
    
	
 
    	
 
    
	
With a copy to: 
    	
Windels Marx Lane & Mittendorf, LLP 
   156 West 56th Street 
   New York, New York 10019 
   Attention: Michele Arbeeny, Esq. 
    
	
 
    	
 
    
	
If to Debtor to:
    	
RBH-TRB East Mezz Urban Renewal Entity, LLC 
   c/o RBH Group 
   89 Market Street, 8th Floor 
   Newark, New Jersey 07102 
   Attention: Ron Beit-Halachmy
    
	
 
    	
 
    
	
With a copy to:
    	
Herrick Feinstein LLP
    

 

14

 

	
 
    	
2 Park Avenue 
   New York, New York 10016 
   Attention: Laurie A. Grasso, Esq
    

 

(b)           Any notice sent by Lender, or Debtor by any of the above methods shall be deemed to be given when so received.

 

(c)           Lender shall be fully entitled to rely upon any telecopy transmission or other writing purported to be sent by any officer of Debtor as being genuine and authorized.

 

6.8          Headings: The headings of any paragraph or Section of this Agreement are for convenience only and shall not be used to interpret any provision of this Agreement.

 

6.9          Survival: All warranties, representations, and covenants made by Debtor herein, or in any agreement referred to herein or on any certificate, document or other instrument delivered by it or on its behalf under this Agreement, shall be considered to have been relied upon by Lender, and shall survive the delivery to Lender of the Notes, regardless of any investigation made by Lender or on its behalf.  All statements in any such certificate or other instrument prepared and/or delivered for the benefit of Lender shall constitute warranties and representations by Debtor hereunder.  Except as otherwise expressly provided herein, all covenants made by Debtor hereunder or under any other agreement or instrument shall be deemed continuing until all Obligations are satisfied in full.  All indemnification obligations under this Agreement shall survive the termination of this Agreement and payment of the Obligations for a period of two (2) years.

 

6.10        Successors and Assigns: This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties.  Debtor may not transfer, assign or delegate any of its duties or obligations hereunder.  Debtor acknowledges and agrees that Lender may at any time, and from time to time, (a) sell participating interests in the Obligations, and Lender’s rights hereunder to other financial institutions, and (b) sell, transfer, or assign the Obligations and Lender’s rights hereunder, to any one or more additional banks or financial institutions.

 

6.11        Duplicate Originals: Two or more duplicate originals of this Agreement may be signed by the parties, each of which shall be an original but all of which together shall constitute one and the same instrument.

 

6.12        Modification: No modification hereof or any agreement referred to herein shall be binding or enforceable unless in writing and signed by Debtor and Lender.

 

6.13        Signatories: Each individual signatory hereto represents and warrants that he is duly authorized to execute this Agreement on behalf of his principal and that he executes the Agreement in such capacity and not as a party.

 

6.14        Third Parties: No rights are intended to be created hereunder, or under any related agreements or documents for the benefit of any third party donee, creditor or incidental beneficiary of Debtor.  Nothing contained in this Agreement shall be construed as a delegation to

 

15

 

Lender of Debtor’s duty of performance, including, without limitation, Debtor’s duties under any account or contract with any other Person.

 

6.15        Discharge of Taxes, Debtor’s Obligations, Etc.: Lender, in its sole discretion, shall have the right at any time, and from time to time, with at least ten (10) days prior notice to Debtor if Debtor fail to do so, to: (a) pay for the performance of any of Debtor’s obligations hereunder, and (b) discharge taxes or Liens, at any time levied or placed on Debtor’s Property in violation of this Agreement unless Debtor is in good faith with due diligence by appropriate proceedings contesting such taxes or Liens and maintaining proper reserves therefor in accordance with GAAP.  Expenses and advances shall be added to the Obligations and bear interest at the highest rate applicable to the Obligations, until reimbursed to Lender.  Such payments and advances made by Lender shall not be construed as a waiver by Lender of a Default or Event of Default under this Agreement.

 

6.16        Consent to Jurisdiction: Debtor and Lender each hereby irrevocably consent to the non-exclusive jurisdiction of the Courts of the State of New Jersey or the federal courts sitting in the County of Essex or City of Newark in any and all actions and proceedings whether arising hereunder or under any other agreement or undertaking.  Debtor waives any objection which Debtor may have based upon lack of personal jurisdiction, improper venue or forum non conveniens.  Debtor irrevocably agrees to service of process by certified mail, return receipt requested to the address of the appropriate party set forth herein.

 

6.17        Waiver of Jury Trial: DEBTOR AND LENDER EACH HEREBY WAIVE ANY AND ALL RIGHTS IT MAY HAVE TO A JURY TRIAL IN CONNECTION WITH ANY LITIGATION, PROCEEDING OR COUNTERCLAIM ARISING WITH RESPECT TO RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO OR UNDER THE BOND DOCUMENTS OR WITH RESPECT TO ANY CLAIMS ARISING OUT OF ANY DISCUSSIONS, NEGOTIATIONS OR COMMUNICATIONS INVOLVING OR RELATED TO ANY PROPOSED RENEWAL, EXTENSION, AMENDMENT, MODIFICATION, RESTRUCTURE, FORBEARANCE, WORKOUT, OR ENFORCEMENT OF THE TRANSACTIONS CONTEMPLATED BY THE BOND DOCUMENTS.

 

6.18        Consequential Damages: Neither Lender nor agent or attorney of Lender, shall be liable for any consequential damages arising from any breach of contract, tort or other wrong relating to the establishment, administration or collection of the Obligations.

 

[SIGNATURES TO FOLLOW ON SEPARATE PAGE]

 

16

 

[SIGNATURE PAGE TO SECURITY AGREEMENT]

 

IN WITNESS WHEREOF, the undersigned parties have executed this Security Agreement the day and year first above written.

 

	
 
    	
RBH-TRB EAST MEZZ URBAN RENEWAL
   ENTITY, LLC
    
	
 
    	
 
    
	
 
    	
a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:  
    	
/s/ Ron Beit-Halachmy
    
	
 
    	
 
    	
Name: Ron Beit-Halachmy 
    
	
 
    	
 
    	
Title: Authorized Signatory
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
TD BANK, N.A.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:  
    	
/s/ Matthew Schatz
    
	
 
    	
 
    	
Name: Matthew Schatz 
    
	
 
    	
 
    	
Title: Vice President
    

 

 

EXHIBIT A

 

Capitalized Interest Account #1— The Leasehold Owner’s “Capitalized Interest Account #1”, as such term is defined in the Intercreditor Agreement, identified as account no. 4267608269.

 

Construction Escrow Account — The Leasehold Owner’s “Construction Escrow Account”, as such term is defined in the Intercreditor Agreement, identified as account no. 4267608219.

 

CRDA Account — The Leasehold Owner’s “CRDA Account”, as such term is defined in the Intercreditor Agreement, identified as account no. 4267608235.

 

QSCB Account — The Leasehold Owner’s “QSCB Account”, as such term is defined in the Intercreditor Agreement, identified as account no. 4267608227.

 

18

 

Schedule 3.3 

Permitted Liens

 

Liens permitted by the Subordination Agreement

 

 

Schedule 3.8

Filing Locations 

New Jersey Secretary of State

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00204-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00204-of-00352.parquet"}]]