Opinion ID: 801993
Heading Depth: 3
Heading Rank: 1

Heading: Investors’ Refinancing Agreement with Morgan

Text: Stanley In 2005, Morgan Stanley refinanced the loan by lending the Investors $7,100,000, of which $6,100,000 was used to refinance the property and of which $1,000,000 was deposited in the escrow accounts. This transaction was memorialized by a promissory note (“Note”), a mortgage and security agreement (“Mortgage”), and a reserve and security agreement (“RSA”). Each of these documents incorporated the terms of the others. Morgan Stanley required that a single agent sign these loan documents and otherwise act on behalf of the Investors. In turn, each LLC executed a Consent of Co-Owners (“Investors’ Consent”) and an amendment to its Limited Liability Company Operating Agreement (“LLC Amendments”). In short, they delegated limited authority to sign and perform under the loan documents to IPA Fund Manager. IPA Fund Manager was a distinct limited liability company managed by Edward Okun. The Investors’ Consent stated, in relevant part: [T]he Co-Owners hereby authorize IPofA Fund Man- ager, LLC, a Virginia Limited liability company (inNo. 11-2891 5 cluding its manager, Edward H. Okun), in its capacity as Vice President of each of the undersigned Co-Owners, to execute in the name of and on behalf of each fo the Co-Owners, and to deliver in connec- tion with the Loan that certain Promissory Note, Mortgage and Security Agreement, Assignment of Leases and Rents, Environmental Indemnity Agreement, Memorandum of Master Lease, Memorandum of Tenants in Common Agreement, and any and all commitments, pledges or assignments of any other collateral, indemnities, certificates, affidavits, financing statements, applications, notices and other instruments, agreements or certificates related to the Loan, and to take from time to time any other actions necessary to effect the transactions contemplated above, upon the terms and conditions identical in all material respects to those terms and conditions set forth in the commitment letter attached hereto as Exhibit A, and the execution and delivery of such agreements and documents by such Vice President shall constitute conclusive evidence that the terms and conditions contained in said documents or in- struments have been approved on behalf of the Co-Owners pursuant to this Consent. . . . [A]ny and all other actions heretofore taken by any member, manager, or authorized representative of the Vice President to execute and deliver any of the agreements authorized by the foregoing resolution or to take any of the actions authorized by the foregoing resolution are hereby approved, ratified, and confirmed in all respects. No further action is consented or taken. 6 No. 11-2891 The LLC Amendments stated, in relevant part: 3.02 Officers. The Company shall have one officer, which shall be a vice president. The Vice President shall have no voting rights nor have any ownership interest in the Company. The sole responsibilities of the Vice President shall be to execute the Loan Documents on behalf of the Company pursuant to the [Delaware Limited Liability Company] Act or any successor statute in conjunction with its refinancing of the Interest. . . . Notwithstanding any other provision of this Agreement, the Vice President, without any further action of the Company or the Member is hereby authorized to execute the Loan Documents . . . on behalf of the Company. . . . Third parties dealing with the Company shall be entitled to conclusively rely on the signature of the Vice President as evidence of the authority of the Vice President to execute the Loan Documents on behalf to the Company and to bind the Company. 3.05 Authorization. The Company, and the Member or the Vice President on behalf of the Company, may execute, enter into, deliver, and perform the Loan Documents and all documents, agreements, certificates or financing statement [sic] contemplated thereby or related thereto . . . , all without any further act, vote or approval of any Member of [sic] other Person notwithstanding any other provision of this Agreement, the Act or applicable rule or regulation. (emphasis added). No. 11-2891 7