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guaranty-agreement-wbd-initial-draft.docx DOCUMENT Real Estate

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CONFIDENTIAL — DRAFT — FOR DISCUSSION PURPOSES ONLY

Prepared by:

Whitford Baines & Driscoll LLP 1221 Avenue of the Americas, Suite 4400 New York, NY 10020

Philip Tarrant Corporation / Catherine Yee

On behalf of: Pinnacle Atlantic Capital, LLC

Draft Date: December 19, 2022

GUARANTY AGREEMENT

(Limited Recourse / Carve-Out Guaranty)

Part of the initial loan document package circulated December 19, 2022 by Whitford Baines & Driscoll LLP (Philip Tarrant Corporation / Catherine Yee) on behalf of Pinnacle Atlantic Capital, LLC.

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GUARANTY AGREEMENT

THIS GUARANTY AGREEMENT (this "Guaranty") is made and entered into as of [__], 202[] (the "Effective Date"), by and between:

VERIMARK HOSPITALITY GROUP INC., a corporation duly organized and existing under the laws of the State of Delaware, having its principal office at 1400 Bayshore Boulevard, Suite 2200, Miami, Florida 33131, and whose shares of common stock are publicly traded on The Nasdaq Stock Market LLC under the ticker symbol "VMRK" (the "Guarantor");

and

PINNACLE ATLANTIC CAPITAL, LLC, a limited liability company duly organized and existing under the laws of the State of Delaware, having its principal office at 200 Lexington Avenue, 38th Floor, New York, New York 10016 (the "Lender").

Guarantor and Lender are sometimes referred to herein individually as a "Party" and collectively as the "Parties."

RECITALS

WHEREAS:

A. Lender has agreed to make a loan in the original principal amount of One Hundred Sixty Million and No/100 Dollars ($160,000,000.00) (the "Loan") to Coral Palms Resort Holdings LLC, a limited liability company duly organized and existing under the laws of the State of Florida (the "Borrower"), pursuant to that certain Loan Agreement of even date herewith by and between Borrower and Lender (as the same may be amended, restated, supplemented, or otherwise modified from time to time, the "Loan Agreement");

B. The Loan is evidenced by that certain Promissory Note of even date herewith made by Borrower in favor of Lender in the original principal amount of One Hundred Sixty Million and No/100 Dollars ($160,000,000.00) (as the same may be amended, restated, supplemented, or otherwise modified from time to time, the "Note") and is secured by, among other things, that certain Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing of even date herewith made by Borrower in favor of Lender (as the same may be amended, restated, supplemented, or otherwise modified from time to time, the "Mortgage") encumbering the real property and improvements commonly known as the Coral Palms Grand Resort & Spa, located at 99000 Overseas Highway, Key Largo, Monroe County, Florida 33037 (the "Property");

C. The Property is more particularly described in the Mortgage and on Exhibit A attached hereto and made a part hereof, and in that certain Warranty Deed recorded in Official Records Book 2847, Page 1122, of the Public Records of Monroe County, Florida, bearing Monroe County Tax Folio No. 00460780-000100;

D. Guarantor is the indirect parent of Borrower and, as such, will derive substantial direct and indirect economic benefit from the making of the Loan by Lender to Borrower;

E. It is a condition precedent to Lender's obligation to fund the Loan that Guarantor execute and deliver this Guaranty to Lender, and Guarantor has agreed to execute and deliver this Guaranty in order to induce Lender to make the Loan to Borrower; and

F. In addition to the Note, the Mortgage, and the Loan Agreement, the Loan is further evidenced, secured, or governed by, among other things, that certain Environmental Indemnity Agreement of even date herewith by Borrower and Guarantor in favor of Lender (the "Environmental Indemnity Agreement"), that certain Cash Management Agreement of even date herewith among Borrower, Lender, and the cash management bank identified therein (the "Cash Management Agreement"), that certain Reserve Agreement of even date herewith by and between Borrower and Lender (the "Reserve Agreement"), and all other documents, instruments, agreements, and certificates now or hereafter executed and delivered by or on behalf of Borrower in connection with the Loan (the Note, Mortgage, Loan Agreement, Environmental Indemnity Agreement, Cash Management Agreement, Reserve Agreement, this Guaranty, and all such other documents, instruments, agreements, and certificates, as the same may be amended, restated, supplemented, or otherwise modified from time to time, are collectively referred to herein as the "Loan Documents").

NOW, THEREFORE, in consideration of the Lender making the Loan to Borrower, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by Guarantor, the Parties hereby agree as follows:

ARTICLE I — DEFINITIONS

Section 1.1 — Defined Terms

Capitalized terms used in this Guaranty and not otherwise defined herein shall have the meanings assigned to such terms in the Loan Agreement. As used in this Guaranty, the following terms shall have the following meanings:

"Borrower" means Coral Palms Resort Holdings LLC, a limited liability company duly organized and existing under the laws of the State of Florida, and its permitted successors and assigns.

"Carve-Out Events" has the meaning ascribed to such term in Section 2.1 of this Guaranty.

"Cash Management Agreement" has the meaning ascribed to such term in Recital F above.

"Environmental Indemnity Agreement" has the meaning ascribed to such term in Recital F above.

"Event of Default" means, unless the context otherwise requires, an Event of Default as defined in the Loan Agreement, the Note, the Mortgage, or any other Loan Document, or an Event of Default as defined in Section 8.1 of this Guaranty, as applicable.

"Guaranteed Obligations" means, collectively, (a) all losses, damages, costs, expenses, liabilities, claims, and amounts for which Guarantor is liable pursuant to Section 2.1 of this Guaranty in connection with the occurrence of any Carve-Out Event, and (b) upon the occurrence of any Springing Recourse Event, the entire Indebtedness and all other obligations of Borrower under the Loan Documents. The Guaranteed Obligations are defined by reference to the specific carve-out liabilities enumerated in Article II of this Guaranty. This Guaranty is a limited recourse guaranty, and Guarantor does not guaranty the full repayment of the Indebtedness or the Loan except upon the occurrence of a Springing Recourse Event as set forth in Section 2.2 of this Guaranty.

"Guarantor" means Verimark Hospitality Group Inc., a corporation duly organized and existing under the laws of the State of Delaware, and its successors and assigns as permitted hereunder.

"Guaranty" means this Guaranty Agreement, as the same may be amended, restated, supplemented, or otherwise modified from time to time.

"Hazardous Materials" has the meaning ascribed to such term in the Environmental Indemnity Agreement.

"Indebtedness" means all amounts from time to time owing by Borrower under or in connection with the Loan Documents, including without limitation (a) the outstanding principal balance of the Loan (in the original principal amount of One Hundred Sixty Million and No/100 Dollars ($160,000,000.00)), (b) all accrued and unpaid interest thereon at the fixed rate of five and thirty-five hundredths percent (5.35%) per annum (or, following the occurrence and during the continuance of an Event of Default, at the Default Rate (as defined in the Note)), (c) all prepayment premiums, yield maintenance amounts, and exit fees, if any, (d) all late charges, (e) all fees and costs payable under the Loan Documents, (f) all costs and expenses (including reasonable attorneys' fees and expenses) incurred by Lender in connection with the enforcement of the Loan Documents, and (g) all other amounts and obligations of Borrower under or in connection with the Loan Documents, whether now existing or hereafter arising, whether direct or indirect, absolute or contingent, liquidated or unliquidated.

"Lender" means Pinnacle Atlantic Capital, LLC, a limited liability company duly organized and existing under the laws of the State of Delaware, and its successors and assigns.

"Loan" means the first mortgage loan in the original principal amount of One Hundred Sixty Million and No/100 Dollars ($160,000,000.00) made by Lender to Borrower pursuant to the Loan Agreement.

"Loan Agreement" has the meaning ascribed to such term in Recital A above.

"Loan Documents" has the meaning ascribed to such term in Recital F above.

"Mortgage" has the meaning ascribed to such term in Recital B above, being that certain Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing of even date herewith made by Borrower in favor of Lender encumbering the Property.

"Note" has the meaning ascribed to such term in Recital B above, being the Promissory Note of even date herewith in the original principal amount of One Hundred Sixty Million and No/100 Dollars ($160,000,000.00) made by Borrower in favor of Lender.

"Permitted Exceptions" has the meaning ascribed to such term in the Mortgage.

"Property" means the real property, improvements, fixtures, and personal property comprising the resort property commonly known as the Coral Palms Grand Resort & Spa, located at 99000 Overseas Highway, Key Largo, Monroe County, Florida 33037, as more particularly described in the Mortgage and in Exhibit A attached hereto, which legal description references a portion of Section 27, Township 60 South, Range 39 East, Monroe County, Florida, bearing Monroe County Tax Folio No. 00460780-000100.

"Rents" has the meaning ascribed to such term in the Mortgage.

"Reserve Agreement" has the meaning ascribed to such term in Recital F above.

"Springing Recourse Event" means any of the events enumerated in Section 2.2 of this Guaranty, the occurrence of which triggers the full recourse liability of Guarantor for the entire Indebtedness and all other obligations under the Loan Documents.

"Transfer" has the meaning ascribed to such term in the Loan Agreement.

Section 1.2 — Rules of Construction

(a) All capitalized terms used in this Guaranty and not otherwise defined herein shall have the respective meanings assigned to such terms in the Loan Agreement. In the event of any conflict between a definition set forth in this Guaranty and a definition set forth in the Loan Agreement, the definition set forth in this Guaranty shall control for purposes of this Guaranty.

(b) The headings and captions of the articles, sections, and subsections of this Guaranty are inserted for convenience of reference only and shall not be deemed to constitute a part of this Guaranty or to affect the meaning or interpretation of any provision hereof.

(c) As used in this Guaranty, the singular shall include the plural, and the plural shall include the singular, as the context may require. The use of any gender shall include all genders. The words "include," "includes," and "including" shall be deemed to be followed by the phrase "without limitation." The words "herein," "hereof," "hereunder," and words of similar import shall refer to this Guaranty as a whole and not to any particular article, section, subsection, or other subdivision hereof.

(d) All references herein to articles, sections, subsections, exhibits, and schedules shall, unless otherwise specified, refer to articles, sections, subsections, exhibits, and schedules of or to this Guaranty.

(e) All references to statutes, laws, rules, and regulations shall include any amendments, modifications, replacements, or successor provisions thereto. Without limiting the generality of the foregoing, references to the laws of the State of Florida shall include the Florida Statutes, as amended, and all applicable rules and regulations promulgated thereunder.

(f) All references to any agreement or document shall mean such agreement or document as the same may be amended, restated, supplemented, or otherwise modified from time to time in accordance with the terms thereof.

(g) Whenever the consent or approval of Lender is required or permitted hereunder, such consent or approval may be granted or withheld in Lender's sole and absolute discretion unless this Guaranty expressly provides that such consent or approval shall not be unreasonably withheld, conditioned, or delayed.

(h) A cross-reference table of defined terms used in this Guaranty and their corresponding definitions in the Loan Agreement and other Loan Documents is set forth on Exhibit B attached hereto for reference purposes only.

ARTICLE II — GUARANTY; SCOPE OF LIABILITY

Section 2.1 — Limited Recourse Carve-Out Guaranty (Non-Recourse Carve-Outs)

(a) Guarantor hereby unconditionally and irrevocably guaranties to Lender, and agrees to be personally liable for, the prompt payment and performance of all losses, damages, costs, expenses, liabilities, claims, and amounts (including without limitation reasonable attorneys' fees and expenses and court costs) actually incurred by Lender arising out of or in connection with any of the following acts or omissions by Borrower, Guarantor, or any person or entity acting on behalf of, or at the direction of, Borrower or Guarantor (each, a "Carve-Out Event" and, collectively, the "Carve-Out Events"):

(i) Any fraud or intentional misrepresentation by or on behalf of Borrower or Guarantor in connection with the Loan, the Loan Documents, or any application, financial statement, report, certificate, or other document delivered to Lender in connection with the Loan;

(ii) Any misappropriation or misapplication of (A) any Rents, revenues, profits, income, or other amounts derived from or generated by the Property following the occurrence and during the continuance of an Event of Default under the Loan Agreement, (B) any insurance proceeds or condemnation awards required under the Loan Documents to be applied to the restoration of the Property or to the repayment of the Indebtedness, or (C) any security deposits, tenant improvement allowances, lease commissions, or other amounts held by Borrower in trust or required to be held in trust under the Loan Documents or applicable law;

(iii) Any waste of the Property, including any physical waste committed or knowingly permitted by Borrower, whether by act or omission, that materially diminishes the value, utility, or condition of the Property or any portion thereof;

(iv) The removal, disposal, transfer, or conveyance of any portion of the Property (including any personal property, fixtures, equipment, or furnishings) in violation of the Loan Documents after the occurrence and during the continuance of an Event of Default under the Loan Agreement, other than removals in the ordinary course of business for purposes of replacing worn or obsolete items with items of equal or greater value and utility;

(v) Any act of arson or other willful or intentional destruction of the Property or any part thereof by or at the direction of Borrower, Guarantor, or any affiliate, agent, employee, or representative of Borrower or Guarantor;

(vi) The failure by Borrower to pay real estate taxes, assessments, or other governmental charges levied or assessed against the Property when and as the same become due and payable, to the extent that Rents and other income from the Property are available and sufficient to pay such taxes, assessments, or charges and are not otherwise required to be deposited into tax or insurance reserve accounts maintained pursuant to the Reserve Agreement;

(vii) The failure by Borrower to maintain the insurance coverages required under the Loan Documents, including without limitation the insurance policies required to be issued by Southland Mutual Insurance Company and Bayfront Specialty Insurance Corp. (or other insurers satisfying the requirements of the Loan Agreement), in the amounts, types, and with the endorsements specified in the Loan Agreement and the Mortgage;

(viii) Any and all liability, losses, damages, costs, expenses, claims, penalties, fines, and remediation obligations arising from or related to (A) the presence, release, threatened release, storage, disposal, generation, transportation, or handling of any Hazardous Materials on, under, in, or about the Property, (B) any violation of any applicable environmental law, rule, regulation, or ordinance with respect to the Property, or (C) any environmental condition at, on, under, or emanating from the Property, in each case as more particularly described in the Environmental Indemnity Agreement of even date herewith (and without limiting the obligations of Borrower and Guarantor under the Environmental Indemnity Agreement). The Parties acknowledge that a Phase I Environmental Site Assessment of the Property was prepared by Oakridge Environmental Consulting Group, Inc. and delivered to Lender prior to the date hereof;

(ix) Any breach of the representations or warranties made by Borrower or Guarantor regarding compliance with the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and the regulations promulgated thereunder, as set forth in the Loan Agreement or any other Loan Document;

(x) Any and all fees, costs, expenses, losses, damages, and amounts incurred by Lender in connection with any bankruptcy, insolvency, reorganization, arrangement, assignment for the benefit of creditors, receivership, or other similar proceeding (whether voluntary or involuntary) commenced by, against, or with respect to Borrower or any affiliate of Borrower (including without limitation any automatic stay or injunction that impedes or delays Lender's exercise of its remedies under the Loan Documents), to the extent that such proceeding was filed, commenced, or solicited by, or is attributable to the actions of, Borrower, Guarantor, or any affiliate, officer, director, member, manager, partner, shareholder, or agent of Borrower or Guarantor; and

(xi) Any failure by Borrower to comply with the single-purpose entity covenants and organizational requirements applicable to Borrower as set forth in the Loan Agreement, including without limitation the covenants requiring Borrower to (A) maintain its existence as a legal entity separate and apart from any other person or entity, (B) not commingle its assets with the assets of any other person or entity, (C) maintain its own books and records and bank accounts, (D) hold itself out to the public as a separate entity, (E) observe all corporate, limited liability company, or other organizational formalities, (F) not guarantee or become obligated for the debts of any other person or entity, and (G) maintain an independent director or manager, as applicable.

(b) The liability of Guarantor under this Section 2.1 with respect to any Carve-Out Event shall be limited to the actual losses, damages, costs, and expenses incurred by Lender as a direct or proximate result of the occurrence of such specific Carve-Out Event. Nothing in this Section 2.1 shall be construed to impose upon Guarantor liability for the entire Indebtedness by reason of the occurrence of a Carve-Out Event; provided, however, that the foregoing limitation shall not apply in the event a Springing Recourse Event has occurred and is continuing under Section 2.2 of this Guaranty.

(c) For the avoidance of doubt, the Carve-Out Events described in this Section 2.1 are separate and independent from, and in addition to, the Springing Recourse Events described in Section 2.2 of this Guaranty, and the occurrence of a Carve-Out Event shall not, in and of itself, constitute a Springing Recourse Event unless such Carve-Out Event is also independently enumerated in Section 2.2.

Section 2.2 — Springing Full Recourse Events

(a) Notwithstanding the limited nature of the guaranty set forth in Section 2.1 of this Guaranty, the Guarantor's liability hereunder shall become fully recourse for the entire Indebtedness and all other obligations of Borrower under the Loan Documents, and the limitations on Guarantor's liability set forth in Section 2.1(b) shall be of no further force or effect, upon the occurrence of any of the following events (each, a "Springing Recourse Event"):

(i) Voluntary Bankruptcy Filing. Any voluntary filing by Borrower or Guarantor (or by any general partner, managing member, or controlling person of Borrower or Guarantor) of a petition for relief under Title 11 of the United States Code (the "Bankruptcy Code"), or any successor statute thereto, or any voluntary filing for relief under any other federal or state bankruptcy, insolvency, reorganization, arrangement, moratorium, receivership, or debtor-relief law, or any voluntary assignment for the benefit of creditors;

(ii) Collusive Involuntary Bankruptcy Filing. The filing of an involuntary petition for relief against Borrower under the Bankruptcy Code or any other applicable bankruptcy, insolvency, or debtor-relief law, which petition is not dismissed within ninety (90) days after the filing thereof, if such filing was collusive or was directly or indirectly solicited, encouraged, aided, abetted, or procured by Borrower, Guarantor, or any affiliate, officer, director, member, manager, partner, shareholder, agent, or representative of Borrower or Guarantor;

(iii) Prohibited Transfer. Any Transfer of all or any part of the Property, or any direct or indirect ownership interest in Borrower (including without limitation any transfer, sale, conveyance, pledge, hypothecation, encumbrance, or other disposition), in violation of the transfer restrictions and prohibitions set forth in the Loan Agreement and the other Loan Documents, without the prior written consent of Lender;

(iv) Prohibited Subordinate Debt. Borrower's incurrence, assumption, or guaranty of any subordinate, junior, or mezzanine debt or indebtedness secured by the Property or by any direct or indirect ownership interest in Borrower, or the granting of any lien, security interest, or encumbrance on the Property or any interest therein (other than the liens and security interests granted to Lender under the Loan Documents and the Permitted Exceptions), without the prior written consent of Lender;

(v) Failure to Maintain Single-Purpose Entity Status. Borrower's failure to maintain its status as a single-purpose entity in compliance with the organizational requirements, covenants, and restrictions set forth in the Loan Agreement, including without limitation any failure to maintain a duly appointed independent director or manager, any commingling of Borrower's assets with the assets of any other person or entity, or any other material violation of the single-purpose entity provisions; and

(vi) Material Breach of Cash Management Agreement. Any material breach by Borrower of the Cash Management Agreement, including without limitation any failure to cause all Rents and other income from the Property to be deposited into the lockbox account established pursuant to the Cash Management Agreement, any unauthorized withdrawal or diversion of funds from such lockbox account or the cash management accounts, or any interference with the operation of the cash sweep mechanisms provided for in the Cash Management Agreement.

(b) Upon the occurrence and during the continuance of any Springing Recourse Event, Guarantor shall be personally liable for the entire outstanding Indebtedness (up to the original principal amount of One Hundred Sixty Million and No/100 Dollars ($160,000,000.00) plus all accrued and unpaid interest (whether at the contract rate or the Default Rate), all prepayment premiums, yield maintenance amounts, exit fees, late charges, costs, expenses (including reasonable attorneys' fees), and all other amounts owing under the Loan Documents), and this Guaranty shall be deemed and treated as a full recourse guaranty of the entire Indebtedness from and after the date of such Springing Recourse Event.

(c) The full recourse liability of Guarantor arising from the occurrence of a Springing Recourse Event shall be in addition to, and not in limitation of, any other liability of Guarantor under this Guaranty (including liability for Carve-Out Events under Section 2.1) or under any other Loan Document, and shall not be subject to any defense, offset, counterclaim, or reduction based on the limited recourse nature of the Loan or the non-recourse provisions of the Loan Agreement or the Note.

Section 2.3 — Nature of Guaranty

(a) This Guaranty is an absolute, unconditional, and irrevocable guaranty of payment and performance, and is not a guaranty of collection. Guarantor acknowledges and agrees that this Guaranty is not conditioned upon Lender first commencing any action or proceeding against Borrower, foreclosing on the Property, realizing upon any collateral, or exhausting any remedies against Borrower, any other guarantor, or any other person or entity before or as a condition to enforcing this Guaranty against Guarantor.

(b) Lender may, in its sole and absolute discretion, proceed directly against Guarantor to collect and enforce the Guaranteed Obligations without first proceeding against Borrower or against or through the Property, and without first pursuing or exhausting any right or remedy that Lender may have against Borrower, any other guarantor, any collateral, or any other person or entity liable for any part of the Indebtedness. The obligations of Guarantor hereunder are independent of the obligations of Borrower under the Loan Documents, and a separate action or actions may be brought and prosecuted against Guarantor whether or not any action is brought or prosecuted against Borrower and whether or not Borrower is joined in any such action or actions.

(c) Guarantor's obligations under this Guaranty shall not be diminished, discharged, or otherwise affected by (i) any lack of validity or enforceability of any Loan Document, (ii) any change in the time, manner, or place of payment or performance, or in any other term, of the Indebtedness or any Loan Document, (iii) any exchange, release, or non-perfection of any collateral, or any release, amendment, or waiver of, or consent to departure from, any other guarantee of the Indebtedness, or (iv) any other circumstance that might otherwise constitute a defense available to, or a discharge of, Borrower or Guarantor.

ARTICLE III — GUARANTOR'S REPRESENTATIONS AND WARRANTIES

Guarantor hereby represents and warrants to Lender as of the date hereof and as of the date of each funding under the Loan as follows:

Section 3.1 — Organization and Good Standing

(a) Guarantor is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware, with full corporate power and authority to own, lease, and operate its properties and to conduct its business as presently conducted.

(b) Guarantor is duly qualified to transact business and is in good standing in the State of Florida and in each other jurisdiction where the nature of its business or the ownership or leasing of its properties requires such qualification, except where the failure to be so qualified would not have a material adverse effect on Guarantor's ability to perform its obligations under this Guaranty.

(c) Guarantor's shares of common stock are publicly traded on The Nasdaq Stock Market LLC under the ticker symbol "VMRK," and Guarantor is subject to the reporting and disclosure requirements of the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Securities and Exchange Commission (the "SEC") promulgated thereunder.

Section 3.2 — Authority; Enforceability

(a) Guarantor has full corporate power and authority to execute, deliver, and perform this Guaranty and each of the other Loan Documents to which Guarantor is a party, and to consummate the transactions contemplated hereby and thereby.

(b) The execution, delivery, and performance by Guarantor of this Guaranty and each of the other Loan Documents to which Guarantor is a party have been duly authorized by all necessary corporate action of Guarantor, including, without limitation, resolutions duly adopted by the board of directors of Guarantor. No other corporate action on the part of Guarantor is necessary to authorize the execution, delivery, and performance of this Guaranty.

(c) This Guaranty has been duly executed and delivered by Guarantor and constitutes the legal, valid, and binding obligation of Guarantor, enforceable against Guarantor in accordance with its terms, subject only to applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general applicability relating to or affecting creditors' rights and to general equitable principles (whether considered in a proceeding in equity or at law).

Section 3.3 — No Conflicts

(a) The execution, delivery, and performance by Guarantor of this Guaranty and the other Loan Documents to which Guarantor is a party do not and will not (i) violate, conflict with, or result in a breach of, or constitute a default (or an event that, with or without notice or lapse of time or both, would constitute a default) under, the certificate of incorporation, bylaws, or other organizational documents of Guarantor, (ii) violate or conflict with any applicable law, statute, rule, regulation, order, judgment, injunction, decree, or governmental requirement applicable to Guarantor or any of its properties or assets, or (iii) violate, conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, or require any notice or consent under, any material agreement, contract, lease, license, or instrument to which Guarantor is a party or by which Guarantor or any of its properties or assets are bound.

(b) No consent, approval, authorization, order, registration, qualification, or filing with any federal, state, local, or foreign governmental authority or regulatory body or any other person or entity is required for the execution, delivery, and performance by Guarantor of this Guaranty or the consummation by Guarantor of the transactions contemplated hereby, other than those that have been duly obtained or made and are in full force and effect on the date hereof.

Section 3.4 — Litigation

There is no action, suit, proceeding, claim, arbitration, mediation, or governmental investigation pending or, to the best of Guarantor's knowledge after due inquiry, threatened against or affecting Guarantor before any court, arbitrator, governmental authority, or administrative body that (a) would, if adversely determined, materially adversely affect Guarantor's financial condition, business, operations, or properties, or (b) would materially adversely affect Guarantor's ability to perform its obligations under this Guaranty or any of the other Loan Documents to which Guarantor is a party.

Section 3.5 — Financial Condition

(a) The financial statements of Guarantor heretofore delivered to Lender, as audited by Keswick & Holt LLP (Andrew Calloway, CPA, engagement partner), have been prepared in accordance with generally accepted accounting principles consistently applied throughout the periods covered thereby, and fairly present in all material respects the financial condition, results of operations, and cash flows of Guarantor and its consolidated subsidiaries as of the dates and for the periods indicated therein.

(b) Since the date of the most recent audited financial statements of Guarantor delivered to Lender, there has been no material adverse change in the financial condition, business, operations, assets, liabilities, or prospects of Guarantor or any of its consolidated subsidiaries. Without limiting the foregoing, as of the date of its most recent audited financial statements, Guarantor reported consolidated revenue of approximately Four Hundred Eighty-Seven Million and No/100 Dollars ($487,000,000.00) and a total enterprise value of approximately One Billion Nine Hundred Million and No/100 Dollars ($1,900,000,000.00).

(c) All financial projections, budgets, and pro forma statements, if any, furnished by Guarantor to Lender in connection with the Loan were prepared in good faith on the basis of assumptions believed by Guarantor to be reasonable at the time of preparation, and represent Guarantor's good faith estimates as of the date thereof (it being understood that such projections are forward-looking in nature and that actual results may differ from projected results).

Section 3.6 — Solvency

Guarantor is, and after giving effect to the execution and delivery of this Guaranty and the consummation of the transactions contemplated hereby will be, solvent. As used herein, "solvent" means that (a) the fair saleable value of Guarantor's assets exceeds the amount of Guarantor's liabilities (including contingent liabilities), (b) Guarantor is able to pay its debts as they become due, and (c) Guarantor does not have unreasonably small capital to conduct its business as presently conducted and as contemplated to be conducted.

Section 3.7 — No Bankruptcy

No petition in bankruptcy, whether voluntary or involuntary, and no proceeding for reorganization, arrangement, composition with creditors, assignment for the benefit of creditors, receivership, dissolution, liquidation, or similar proceeding under any applicable federal, state, or foreign law has been filed by or against Guarantor, and Guarantor is not contemplating the filing of any such petition or proceeding and is not aware of any facts or circumstances that would form the basis for the filing of any such petition or proceeding.

Section 3.8 — ERISA

(a) Guarantor is in compliance in all material respects with all applicable requirements of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and the Internal Revenue Code of 1986, as amended (the "Code"), with respect to each "employee benefit plan" (as defined in Section 3(3) of ERISA) maintained, sponsored, or contributed to by Guarantor or any of its "ERISA Affiliates" (as defined in the Loan Agreement).

(b) No ERISA event has occurred or is reasonably expected to occur that has resulted in or could reasonably be expected to result in a material liability to Guarantor or any of its ERISA Affiliates, including without limitation (i) any "reportable event" (within the meaning of Section 4043 of ERISA), (ii) any "accumulated funding deficiency" (within the meaning of Section 302 of ERISA or Section 412 of the Code), (iii) any withdrawal liability under Section 4201 of ERISA, or (iv) any termination of a "defined benefit plan" (within the meaning of Section 3(35) of ERISA) subject to Title IV of ERISA.

(c) None of the assets of Guarantor constitute or will constitute "plan assets" (within the meaning of 29 C.F.R. Section 2510.3-101, as modified by Section 3(42) of ERISA) of any employee benefit plan.

Section 3.9 — Taxes

Guarantor has timely filed all federal, state, local, and foreign tax returns and reports that are required to be filed by Guarantor, and has paid all taxes, assessments, fees, and other governmental charges due and payable by Guarantor (including, without limitation, all income, franchise, employment, sales, use, excise, and property taxes), except for such taxes, assessments, fees, and charges that are being contested in good faith by appropriate proceedings and for which adequate reserves have been established on Guarantor's books and financial statements in accordance with generally accepted accounting principles. No tax lien has been filed against any property or assets of Guarantor, and no claim is being asserted in writing by any taxing authority with respect to any taxes of Guarantor.

Section 3.10 — Anti-Money Laundering; OFAC

(a) Guarantor is in compliance with all applicable anti-money laundering laws, rules, and regulations, including without limitation the Bank Secrecy Act (31 U.S.C. §§ 5311 et seq.), the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (the "USA PATRIOT Act") (Pub. L. 107-56), and all regulations promulgated thereunder.

(b) Neither Guarantor nor any of its affiliates, directors, officers, employees, or agents is a person or entity (i) whose name appears on the Specially Designated Nationals and blocked Persons List maintained by the Office of Foreign Assets Control of the United States Department of the Treasury ("OFAC"), the lists maintained by the United Nations Security Council, or any other list of prohibited or restricted parties maintained by any governmental authority (each, a "Prohibited Person"), (ii) that is owned or controlled by, or acts for or on behalf of, any Prohibited Person, (iii) with whom dealings are prohibited or restricted under any sanctions laws, executive orders, or regulations administered by OFAC, the U.S. Department of State, the European Union, or Her Majesty's Treasury of the United Kingdom, or (iv) located, organized, or resident in a country or territory that is the subject of comprehensive OFAC sanctions (including, as of the date hereof, Cuba, Iran, North Korea, Syria, and the Crimea, Donetsk, and Luhansk regions of Ukraine).

(c) Guarantor has implemented and maintains policies, procedures, and internal controls that are reasonably designed to ensure compliance with the anti-money laundering and sanctions laws and regulations referred to in this Section 3.10.

Section 3.11 — Benefit

Guarantor acknowledges and confirms that (a) Guarantor is the indirect parent of Borrower and has a substantial direct and indirect ownership interest in Borrower, (b) the making of the Loan by Lender to Borrower will provide substantial direct and indirect economic benefit to Guarantor, including without limitation through the enhancement of the value of Guarantor's investment in Borrower and the operations of the Property, and (c) Guarantor has had the opportunity to review the Loan Documents and is fully familiar with the terms and conditions thereof.

ARTICLE IV — COVENANTS OF GUARANTOR

Guarantor hereby covenants and agrees with Lender that, so long as any portion of the Indebtedness remains outstanding or any obligation of Guarantor under this Guaranty remains unsatisfied:

Section 4.1 — Financial Reporting

Guarantor shall deliver to Lender, at Guarantor's sole cost and expense, each of the following:

(a) Annual Audited Financial Statements. Within one hundred twenty (120) days after the end of each fiscal year of Guarantor, annual consolidated and consolidating financial statements of Guarantor and its subsidiaries for such fiscal year, including a consolidated balance sheet, statement of income, statement of cash flows, and statement of stockholders' equity, together with the notes thereto, all prepared in accordance with generally accepted accounting principles consistently applied, audited by Keswick & Holt LLP, or another independent certified public accounting firm of national reputation and standing reasonably acceptable to Lender, and accompanied by the unqualified report and opinion of such accounting firm. Such financial statements shall be certified by Guarantor's chief financial officer as being true, correct, and complete in all material respects.

(b) Quarterly Unaudited Financial Statements. Within sixty (60) days after the end of each of the first three (3) fiscal quarters of each fiscal year of Guarantor, unaudited consolidated financial statements of Guarantor and its subsidiaries for such fiscal quarter, including a condensed consolidated balance sheet, statement of income, and statement of cash flows, prepared in accordance with generally accepted accounting principles consistently applied (subject to normal year-end adjustments and the absence of footnotes), and certified by Guarantor's chief financial officer as being true, correct, and complete in all material respects.

(c) Annual Corporate Financial Statement. Within one hundred twenty (120) days after the end of each fiscal year of Guarantor, a corporate financial statement of Guarantor, in form and substance reasonably acceptable to Lender, setting forth in reasonable detail the assets, liabilities, net worth, and liquidity of Guarantor as of the end of such fiscal year, certified by Guarantor's chief financial officer.

(d) SEC Filings. Promptly upon the filing thereof (and in any event within five (5) business days after such filing), copies of all Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements, and other reports or filings filed by Guarantor with the SEC, together with all exhibits thereto. Guarantor, being a company listed on The Nasdaq Stock Market LLC under the ticker symbol "VMRK," acknowledges that Lender may independently monitor Guarantor's public filings through the SEC's EDGAR system; provided, however, that Lender's ability to access such filings through EDGAR shall not relieve Guarantor of its obligation to deliver copies thereof to Lender as required by this Section 4.1(d).

(e) Other Information. Such other financial information and documentation as Lender may reasonably request from time to time, including without limitation schedules of contingent liabilities, details of indebtedness, and information regarding material contracts and agreements.

Section 4.2 — Net Worth / Liquidity Covenants

Guarantor shall maintain at all times during the term of the Loan the following minimum financial thresholds:

(a) Minimum Net Worth. A net worth (as determined in accordance with generally accepted accounting principles consistently applied, calculated as total assets minus total liabilities) of not less than $[__] (the "Minimum Net Worth Requirement"). For purposes of this Section 4.2(a), net worth shall be determined on a consolidated basis and shall exclude goodwill, intangible assets, and any assets pledged to secure obligations of persons or entities other than Guarantor and its consolidated subsidiaries.

(b) Minimum Liquidity. Liquidity (defined as the sum of (i) unrestricted cash and cash equivalents held by Guarantor plus (ii) unused and available commitments under Guarantor's revolving credit facilities (to the extent such facilities are committed and not subject to conditions that have not been satisfied)) of not less than $[__] (the "Minimum Liquidity Requirement").

(c) Testing and Certification. Compliance with the Minimum Net Worth Requirement and the Minimum Liquidity Requirement shall be tested and certified by Guarantor's chief financial officer on a quarterly basis, with such certifications to be delivered concurrently with the quarterly financial statements required under Section 4.1(b) and the annual financial statements required under Section 4.1(a).

(d) Default. Any failure by Guarantor to satisfy the Minimum Net Worth Requirement or the Minimum Liquidity Requirement shall constitute an immediate Event of Default under this Guaranty without notice or opportunity to cure, and may, if so provided in the Loan Agreement, constitute a Springing Recourse Event.

Section 4.3 — Existence; Compliance with Laws

(a) Guarantor shall maintain its corporate existence and good standing under the laws of the State of Delaware and its qualification to transact business and good standing in the State of Florida and in each other jurisdiction where such qualification is required for the conduct of Guarantor's business or the ownership or leasing of its properties, except where the failure to maintain such qualification would not have a material adverse effect on Guarantor's ability to perform its obligations under this Guaranty.

(b) Guarantor shall comply in all material respects with all applicable laws, statutes, rules, regulations, orders, judgments, injunctions, decrees, and governmental requirements (including, without limitation, all environmental laws, ERISA, the USA PATRIOT Act, OFAC sanctions, and securities laws and regulations applicable to Guarantor as a Nasdaq-listed company), the non-compliance with which could reasonably be expected to have a material adverse effect on Guarantor's financial condition, business, operations, or properties, or on Guarantor's ability to perform its obligations under this Guaranty.

Section 4.4 — Notice of Material Events

Guarantor shall promptly, and in any event within five (5) business days after Guarantor has knowledge thereof, deliver written notice to Lender of:

(a) The occurrence or existence of any Springing Recourse Event or any Carve-Out Event, or any event or condition that, with the giving of notice or the passage of time, or both, would constitute a Springing Recourse Event or a Carve-Out Event, together with a description of the nature and extent thereof and the actions being taken or proposed to be taken by Guarantor in connection therewith;

(b) The commencement or written threat of any material litigation, arbitration, mediation, or governmental investigation against or affecting Guarantor, including any action, suit, or proceeding that, if adversely determined, could reasonably be expected to result in a liability to Guarantor in excess of Five Million and No/100 Dollars ($5,000,000.00) individually or Ten Million and No/100 Dollars ($10,000,000.00) in the aggregate;

(c) Any material adverse change in the financial condition, business, operations, assets, liabilities, or prospects of Guarantor, including without limitation any downgrade of Guarantor's credit rating by any nationally recognized rating agency, any default or event of default under any other material indebtedness of Guarantor, or any material impairment of Guarantor's ability to perform its obligations under this Guaranty; and

(d) Any change in the ownership structure of Guarantor that results in a change of control (as such term is defined in Guarantor's organizational documents or in any applicable shareholders' agreement or voting agreement), or any merger, consolidation, reorganization, or similar transaction involving Guarantor.

Section 4.5 — No Dissolution or Merger

Guarantor shall not dissolve, liquidate, wind up its affairs, or cease to conduct business, and shall not merge with or into, or consolidate with, any other person or entity, without the prior written consent of Lender; provided, however, that Lender's consent shall not be required for any merger or consolidation in which (a) Guarantor is the surviving entity, (b) the surviving entity assumes in writing, in form and substance reasonably satisfactory to Lender, all obligations of Guarantor under this Guaranty and the other Loan Documents to which Guarantor is a party, (c) the surviving entity maintains, immediately after giving effect to such merger or consolidation, a net worth at least equal to the greater of (i) the Minimum Net Worth Requirement and (ii) the net worth of Guarantor immediately prior to such merger or consolidation, and (d) the surviving entity maintains, immediately after giving effect to such merger or consolidation, liquidity at least equal to the greater of (i) the Minimum Liquidity Requirement and (ii) the liquidity of Guarantor immediately prior to such merger or consolidation.

Section 4.6 — Taxes

Guarantor shall timely file all federal, state, local, and foreign tax returns and reports required to be filed by Guarantor and shall timely pay all taxes, assessments, fees, and other governmental charges assessed or levied against Guarantor or any of its properties or assets, as the same become due and payable, except for such taxes, assessments, fees, and charges that are being contested in good faith by appropriate proceedings and for which adequate reserves have been established on Guarantor's books and financial statements in accordance with generally accepted accounting principles. Guarantor shall promptly pay any tax lien or encumbrance that may be filed against any of its properties or assets.

ARTICLE V — WAIVERS BY GUARANTOR

Section 5.1 — Waivers

Guarantor hereby unconditionally and irrevocably waives, to the fullest extent permitted by applicable law, each and every one of the following:

(a) Notice of Acceptance. Any requirement that Lender notify Guarantor of Lender's acceptance of this Guaranty. Guarantor acknowledges that this Guaranty shall be deemed accepted by Lender upon the execution and delivery hereof.

(b) Presentment, Demand, and Protest. Presentment for payment, demand for payment, protest, and notice of presentment, demand, protest, nonpayment, and dishonor, and any and all other notices or demands of any kind in connection with the Indebtedness, the Loan Documents, or this Guaranty, except as expressly provided herein.

(c) Notice of Default. Notice of any default or Event of Default under the Loan Documents (other than any notice expressly required to be given by Lender to Guarantor pursuant to the express terms of this Guaranty).

(d) Notice of Modification. Notice of any amendment, modification, supplement, extension, renewal, rearrangement, increase, or decrease of the Loan Documents or the Indebtedness, including without limitation any increase in the interest rate from the initial fixed rate of five and thirty-five hundredths percent (5.35%) per annum to the Default Rate or any other rate, any change in the amortization schedule from interest-only payments during the first two (2) years of the Loan term to payments of principal and interest on a thirty (30)-year amortization schedule during years three (3) through five (5) of the Loan term, any modification of the maturity date, or any exercise by Borrower of the two (2) one (1)-year extension options available under the Loan Agreement (subject to satisfaction of the extension conditions, including a minimum Debt Service Coverage Ratio of 1.25x and payment of the extension fee of twenty-five hundredths of one percent (0.25%) of the then-outstanding principal balance of the Loan).

(e) Notice of Release or Substitution. Notice of any release, substitution, exchange, impairment, or addition of any collateral securing the Indebtedness, or any release, substitution, or addition of any other guarantor or obligor with respect to the Indebtedness.

(f) Requirement to Proceed Against Borrower. Any right to require Lender to (i) proceed against Borrower before proceeding against Guarantor, (ii) proceed against or exhaust any collateral, security, or other guaranty held by Lender before proceeding against Guarantor, (iii) join Borrower or any other person or entity in any action against Guarantor, or (iv) pursue any other remedy in Lender's power whatsoever before proceeding against Guarantor.

(g) Statute of Limitations. Any defense based on any statute of limitations in any action or proceeding arising out of or related to this Guaranty, to the fullest extent permitted by law.

(h) Suretyship Defenses. Any and all suretyship defenses, rights, and remedies generally, including without limitation any defense arising under Sections 673.6051, 673.4191, 673.5011, 679.6021, or any other provision of the Florida Statutes (including the Florida Uniform Commercial Code), and any defense that would be available to a surety or guarantor under the common law of the State of Florida or any other applicable jurisdiction.

(i) Defense of Borrower's Disability. Any defense arising by reason of any disability, lack of capacity, incapacity, lack of authority, death, dissolution, bankruptcy, insolvency, or any other defense of Borrower, or by reason of the cessation from any cause of the liability of Borrower under the Loan Documents (other than the indefeasible payment in full of the Indebtedness and the satisfaction in full of all other obligations under the Loan Documents).

(j) Subrogation, Contribution, and Indemnification. Any right of subrogation, contribution, indemnification, reimbursement, or similar right that Guarantor may have against Borrower or against any other person or entity or any collateral or security, and any right to enforce any remedy that Lender may have against Borrower or any other person or entity, in each case until the Indebtedness has been indefeasibly paid and satisfied in full and the Loan Documents have been fully terminated. If, notwithstanding the foregoing, any payment is made to Guarantor on account of any such subrogation, contribution, indemnification, or reimbursement right prior to the indefeasible payment in full of the Indebtedness, such payment shall be held by Guarantor in trust for Lender and shall be promptly turned over to Lender in the form received (properly endorsed or assigned, if necessary) to be applied to the Indebtedness, whether matured or unmatured.

(k) marshaling. Any right to require the marshaling of assets or to require Lender to resort to any particular asset or collateral before resorting to any other asset or collateral or before proceeding against Guarantor.

(l) Election of Remedies. Any defense arising from Lender's election of any remedy against Borrower or any collateral, including without limitation any defense based on Lender's election to proceed by nonjudicial foreclosure under the Mortgage pursuant to applicable Florida law, and any defense arising from Lender's failure to realize upon any collateral or to take any action that might result in the release or discharge of Guarantor's obligations hereunder.

Section 5.2 — Guarantor's Understanding

(a) Guarantor acknowledges and confirms that Guarantor has independently reviewed and is fully familiar with the terms, conditions, and provisions of each of the Loan Documents, including without limitation the Loan Agreement, the Note, the Mortgage, the Environmental Indemnity Agreement, the Cash Management Agreement, and the Reserve Agreement, and that Guarantor has had the opportunity to consult with legal counsel of Guarantor's choice with respect to the terms and provisions of this Guaranty and each of the other Loan Documents.

(b) Guarantor acknowledges and confirms that Guarantor has independently reviewed and is fully familiar with the financial condition of Borrower and the condition, value, and prospects of the Property, and that Guarantor has made its own assessment of the creditworthiness of Borrower and the value and condition of the Property without reliance on any information provided by Lender. Guarantor is not relying on Lender or Lender's counsel, Whitford Baines & Driscoll LLP, to supply any such information to Guarantor, and Lender shall have no obligation to provide any such information to Guarantor, whether now or at any time in the future.

(c) Guarantor acknowledges that Lender would not make the Loan to Borrower without this Guaranty and that the consideration received by Guarantor for the execution and delivery of this Guaranty is sufficient.

ARTICLE VI — SUBORDINATION OF GUARANTOR'S CLAIMS

Section 6.1 — Subordination

Any and all indebtedness, liabilities, and obligations of Borrower to Guarantor, whether now existing or hereafter arising, whether direct or indirect, absolute or contingent, liquidated or unliquidated, secured or unsecured, and howsoever evidenced (including without limitation any loans, advances, management fees, dividends, distributions, intercompany charges, or other amounts owed by Borrower to Guarantor) (collectively, the "Subordinated Claims"), are hereby subordinated in right of payment, priority, and enforcement to the prior indefeasible payment and satisfaction in full of the Indebtedness owed by Borrower to Lender under the Loan Documents. Guarantor shall not demand, accept, receive, collect, or enforce any payment on account of any Subordinated Claim, whether in cash, property, by set-off, or otherwise, until the Indebtedness has been indefeasibly paid and satisfied in full and the Loan Documents have been fully terminated, without the prior written consent of Lender. Nothing in this Section 6.1 shall prohibit Borrower from making distributions to its members or equity owners (including indirect distributions through intermediate entities to Guarantor) to the extent expressly permitted under the Loan Agreement and the Cash Management Agreement, provided that no Event of Default has occurred and is continuing under the Loan Documents at the time of any such distribution.

Section 6.2 — Turnover of Payments

In the event that Guarantor receives any payment, distribution, or other value on account of any Subordinated Claim in violation of Section 6.1 of this Guaranty, whether received by Guarantor from Borrower, any trustee, receiver, liquidator, custodian, or similar official, or any other person or entity, Guarantor shall receive and hold the same in trust for the benefit of Lender, shall immediately notify Lender of the receipt thereof, and shall promptly turn over and deliver the same to Lender in the form received (properly endorsed or assigned to Lender, if necessary) to be applied by Lender to the Indebtedness (whether matured or unmatured) in such order and manner as Lender may determine in its sole discretion. In the event of the failure of Guarantor to make any such endorsement, assignment, or delivery, Lender is hereby irrevocably authorized to make the same on behalf of Guarantor.

ARTICLE VII — LENDER'S RIGHTS; NO IMPAIRMENT OF GUARANTY

Section 7.1 — Lender's Rights

Lender may, at any time and from time to time, in Lender's sole and absolute discretion, without notice to or consent of Guarantor, and without in any way affecting, impairing, diminishing, releasing, or discharging the obligations of Guarantor under this Guaranty:

(a) Amend, modify, supplement, extend, renew, restate, increase, decrease, or otherwise change any one or more of the terms, conditions, covenants, or provisions of the Loan Documents, including without limitation the terms of repayment, interest rate, maturity date, amortization schedule, prepayment provisions, reserve requirements, insurance requirements, property management requirements, or any other provision thereof;

(b) Increase or decrease the interest rate applicable to the Loan (currently a fixed rate of five and thirty-five hundredths percent (5.35%) per annum), whether by agreement with Borrower, as a result of the application of any Default Rate, or otherwise;

(c) Grant one or more extensions of the maturity date of the Loan or any portion thereof, including without limitation the two (2) one (1)-year extension options available under the Loan Agreement (each subject to the satisfaction of certain conditions precedent, including a minimum Debt Service Coverage Ratio of not less than 1.25x and payment of an extension fee equal to twenty-five hundredths of one percent (0.25%) of the then-outstanding principal balance of the Loan);

(d) Release, surrender, exchange, substitute, compromise, settle, impair, subordinate, or otherwise deal with, in any manner and in any order, any collateral or security for the Indebtedness or any part thereof, including the Property;

(e) Release, discharge, or waive any obligation of any other guarantor, surety, co-maker, endorser, or other person or entity at any time liable for the payment or performance of the Indebtedness or any part thereof;

(f) Apply any sums received by Lender from or on behalf of Borrower, any guarantor, or any other person or entity, or from the disposition of any collateral, to the Indebtedness in any order, manner, or priority as Lender may determine in its sole discretion, regardless of whether such sums are attributable to principal, interest, fees, costs, expenses, or any other component of the Indebtedness;

(g) Settle, compromise, release, compound, or adjust any claims that Lender may have against Borrower or against any other person or entity liable for the Indebtedness or any part thereof;

(h) Take or refrain from taking any action under the Loan Documents or with respect to the Property, including without limitation exercising or refraining from exercising any right

CONFIDENTIAL — DRAFT — FOR DISCUSSION PURPOSES ONLY
Prepared by:
Whitford Baines & Driscoll LLP 1221 Avenue of the Americas, Suite 4400 New York, NY 10020
Philip Tarrant Corporation / Catherine Yee
On behalf of: Pinnacle Atlantic Capital, LLC
Draft Date: December 19, 2022
GUARANTY AGREEMENT
(Limited Recourse / Carve-Out Guaranty)
Part of the initial loan document package circulated December 19, 2022 by Whitford Baines & Driscoll LLP (Philip Tarrant Corporation / Catherine Yee) on behalf of Pinnacle Atlantic Capital, LLC.
Right-click to update Table of Contents
GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT (this "Guaranty") is made and entered into as of [__], 202[] (the "Effective Date"), by and between:
VERIMARK HOSPITALITY GROUP INC., a corporation duly organized and existing under the laws of the State of Delaware, having its principal office at 1400 Bayshore Boulevard, Suite 2200, Miami, Florida 33131, and whose shares of common stock are publicly traded on The Nasdaq Stock Market LLC under the ticker symbol "VMRK" (the "Guarantor");
and
PINNACLE ATLANTIC CAPITAL, LLC, a limited liability company duly organized and existing under the laws of the State of Delaware, having its principal office at 200 Lexington Avenue, 38th Floor, New York, New York 10016 (the "Lender").
Guarantor and Lender are sometimes referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS:
A. Lender has agreed to make a loan in the original principal amount of One Hundred Sixty Million and No/100 Dollars ($160,000,000.00) (the "Loan") to Coral Palms Resort Holdings LLC, a limited liability company duly organized and existing under the laws of the State of Florida (the "Borrower"), pursuant to that certain Loan Agreement of even date herewith by and between Borrower and Lender (as the same may be amended, restated, supplemented, or otherwise modified from time to time, the "Loan Agreement");
B. The Loan is evidenced by that certain Promissory Note of even date herewith made by Borrower in favor of Lender in the original principal amount of One Hundred Sixty Million and No/100 Dollars ($160,000,000.00) (as the same may be amended, restated, supplemented, or otherwise modified from time to time, the "Note") and is secured by, among other things, that certain Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing of even date herewith made by Borrower in favor of Lender (as the same may be amended, restated, supplemented, or otherwise modified from time to time, the "Mortgage") encumbering the real property and improvements commonly known as the Coral Palms Grand Resort & Spa, located at 99000 Overseas Highway, Key Largo, Monroe County, Florida 33037 (the "Property");
C. The Property is more particularly described in the Mortgage and on Exhibit A attached hereto and made a part hereof, and in that certain Warranty Deed recorded in Official Records Book 2847, Page 1122, of the Public Records of Monroe County, Florida, bearing Monroe County Tax Folio No. 00460780-000100;
D. Guarantor is the indirect parent of Borrower and, as such, will derive substantial direct and indirect economic benefit from the making of the Loan by Lender to Borrower;
E. It is a condition precedent to Lender's obligation to fund the Loan that Guarantor execute and deliver this Guaranty to Lender, and Guarantor has agreed to execute and deliver this Guaranty in order to induce Lender to make the Loan to Borrower; and
F. In addition to the Note, the Mortgage, and the Loan Agreement, the Loan is further evidenced, secured, or governed by, among other things, that certain Environmental Indemnity Agreement of even date herewith by Borrower and Guarantor in favor of Lender (the "Environmental Indemnity Agreement"), that certain Cash Management Agreement of even date herewith among Borrower, Lender, and the cash management bank identified therein (the "Cash Management Agreement"), that certain Reserve Agreement of even date herewith by and between Borrower and Lender (the "Reserve Agreement"), and all other documents, instruments, agreements, and certificates now or hereafter executed and delivered by or on behalf of Borrower in connection with the Loan (the Note, Mortgage, Loan Agreement, Environmental Indemnity Agreement, Cash Management Agreement, Reserve Agreement, this Guaranty, and all such other documents, instruments, agreements, and certificates, as the same may be amended, restated, supplemented, or otherwise modified from time to time, are collectively referred to herein as the "Loan Documents").
NOW, THEREFORE, in consideration of the Lender making the Loan to Borrower, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by Guarantor, the Parties hereby agree as follows:
ARTICLE I — DEFINITIONS
Section 1.1 — Defined Terms
Capitalized terms used in this Guaranty and not otherwise defined herein shall have the meanings assigned to such terms in the Loan Agreement. As used in this Guaranty, the following terms shall have the following meanings:
"Borrower" means Coral Palms Resort Holdings LLC, a limited liability company duly organized and existing under the laws of the State of Florida, and its permitted successors and assigns.
"Carve-Out Events" has the meaning ascribed to such term in Section 2.1 of this Guaranty.
"Cash Management Agreement" has the meaning ascribed to such term in Recital F above.
"Environmental Indemnity Agreement" has the meaning ascribed to such term in Recital F above.
"Event of Default" means, unless the context otherwise requires, an Event of Default as defined in the Loan Agreement, the Note, the Mortgage, or any other Loan Document, or an Event of Default as defined in Section 8.1 of this Guaranty, as applicable.
"Guaranteed Obligations" means, collectively, (a) all losses, damages, costs, expenses, liabilities, claims, and amounts for which Guarantor is liable pursuant to Section 2.1 of this Guaranty in connection with the occurrence of any Carve-Out Event, and (b) upon the occurrence of any Springing Recourse Event, the entire Indebtedness and all other obligations of Borrower under the Loan Documents. The Guaranteed Obligations are defined by reference to the specific carve-out liabilities enumerated in Article II of this Guaranty. This Guaranty is a limited recourse guaranty, and Guarantor does not guaranty the full repayment of the Indebtedness or the Loan except upon the occurrence of a Springing Recourse Event as set forth in Section 2.2 of this Guaranty.
"Guarantor" means Verimark Hospitality Group Inc., a corporation duly organized and existing under the laws of the State of Delaware, and its successors and assigns as permitted hereunder.
"Guaranty" means this Guaranty Agreement, as the same may be amended, restated, supplemented, or otherwise modified from time to time.
"Hazardous Materials" has the meaning ascribed to such term in the Environmental Indemnity Agreement.
"Indebtedness" means all amounts from time to time owing by Borrower under or in connection with the Loan Documents, including without limitation (a) the outstanding principal balance of the Loan (in the original principal amount of One Hundred Sixty Million and No/100 Dollars ($160,000,000.00)), (b) all accrued and unpaid interest thereon at the fixed rate of five and thirty-five hundredths percent (5.35%) per annum (or, following the occurrence and during the continuance of an Event of Default, at the Default Rate (as defined in the Note)), (c) all prepayment premiums, yield maintenance amounts, and exit fees, if any, (d) all late charges, (e) all fees and costs payable under the Loan Documents, (f) all costs and expenses (including reasonable attorneys' fees and expenses) incurred by Lender in connection with the enforcement of the Loan Documents, and (g) all other amounts and obligations of Borrower under or in connection with the Loan Documents, whether now existing or hereafter arising, whether direct or indirect, absolute or contingent, liquidated or unliquidated.
"Lender" means Pinnacle Atlantic Capital, LLC, a limited liability company duly organized and existing under the laws of the State of Delaware, and its successors and assigns.
"Loan" means the first mortgage loan in the original principal amount of One Hundred Sixty Million and No/100 Dollars ($160,000,000.00) made by Lender to Borrower pursuant to the Loan Agreement.
"Loan Agreement" has the meaning ascribed to such term in Recital A above.
"Loan Documents" has the meaning ascribed to such term in Recital F above.
"Mortgage" has the meaning ascribed to such term in Recital B above, being that certain Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing of even date herewith made by Borrower in favor of Lender encumbering the Property.
"Note" has the meaning ascribed to such term in Recital B above, being the Promissory Note of even date herewith in the original principal amount of One Hundred Sixty Million and No/100 Dollars ($160,000,000.00) made by Borrower in favor of Lender.
"Permitted Exceptions" has the meaning ascribed to such term in the Mortgage.
"Property" means the real property, improvements, fixtures, and personal property comprising the resort property commonly known as the Coral Palms Grand Resort & Spa, located at 99000 Overseas Highway, Key Largo, Monroe County, Florida 33037, as more particularly described in the Mortgage and in Exhibit A attached hereto, which legal description references a portion of Section 27, Township 60 South, Range 39 East, Monroe County, Florida, bearing Monroe County Tax Folio No. 00460780-000100.
"Rents" has the meaning ascribed to such term in the Mortgage.
"Reserve Agreement" has the meaning ascribed to such term in Recital F above.
"Springing Recourse Event" means any of the events enumerated in Section 2.2 of this Guaranty, the occurrence of which triggers the full recourse liability of Guarantor for the entire Indebtedness and all other obligations under the Loan Documents.
"Transfer" has the meaning ascribed to such term in the Loan Agreement.
Section 1.2 — Rules of Construction
(a) All capitalized terms used in this Guaranty and not otherwise defined herein shall have the respective meanings assigned to such terms in the Loan Agreement. In the event of any conflict between a definition set forth in this Guaranty and a definition set forth in the Loan Agreement, the definition set forth in this Guaranty shall control for purposes of this Guaranty.
(b) The headings and captions of the articles, sections, and subsections of this Guaranty are inserted for convenience of reference only and shall not be deemed to constitute a part of this Guaranty or to affect the meaning or interpretation of any provision hereof.
(c) As used in this Guaranty, the singular shall include the plural, and the plural shall include the singular, as the context may require. The use of any gender shall include all genders. The words "include," "includes," and "including" shall be deemed to be followed by the phrase "without limitation." The words "herein," "hereof," "hereunder," and words of similar import shall refer to this Guaranty as a whole and not to any particular article, section, subsection, or other subdivision hereof.
(d) All references herein to articles, sections, subsections, exhibits, and schedules shall, unless otherwise specified, refer to articles, sections, subsections, exhibits, and schedules of or to this Guaranty.
(e) All references to statutes, laws, rules, and regulations shall include any amendments, modifications, replacements, or successor provisions thereto. Without limiting the generality of the foregoing, references to the laws of the State of Florida shall include the Florida Statutes, as amended, and all applicable rules and regulations promulgated thereunder.
(f) All references to any agreement or document shall mean such agreement or document as the same may be amended, restated, supplemented, or otherwise modified from time to time in accordance with the terms thereof.
(g) Whenever the consent or approval of Lender is required or permitted hereunder, such consent or approval may be granted or withheld in Lender's sole and absolute discretion unless this Guaranty expressly provides that such consent or approval shall not be unreasonably withheld, conditioned, or delayed.
(h) A cross-reference table of defined terms used in this Guaranty and their corresponding definitions in the Loan Agreement and other Loan Documents is set forth on Exhibit B attached hereto for reference purposes only.
ARTICLE II — GUARANTY; SCOPE OF LIABILITY
Section 2.1 — Limited Recourse Carve-Out Guaranty (Non-Recourse Carve-Outs)
(a) Guarantor hereby unconditionally and irrevocably guaranties to Lender, and agrees to be personally liable for, the prompt payment and performance of all losses, damages, costs, expenses, liabilities, claims, and amounts (including without limitation reasonable attorneys' fees and expenses and court costs) actually incurred by Lender arising out of or in connection with any of the following acts or omissions by Borrower, Guarantor, or any person or entity acting on behalf of, or at the direction of, Borrower or Guarantor (each, a "Carve-Out Event" and, collectively, the "Carve-Out Events"):
(i) Any fraud or intentional misrepresentation by or on behalf of Borrower or Guarantor in connection with the Loan, the Loan Documents, or any application, financial statement, report, certificate, or other document delivered to Lender in connection with the Loan;
(ii) Any misappropriation or misapplication of (A) any Rents, revenues, profits, income, or other amounts derived from or generated by the Property following the occurrence and during the continuance of an Event of Default under the Loan Agreement, (B) any insurance proceeds or condemnation awards required under the Loan Documents to be applied to the restoration of the Property or to the repayment of the Indebtedness, or (C) any security deposits, tenant improvement allowances, lease commissions, or other amounts held by Borrower in trust or required to be held in trust under the Loan Documents or applicable law;
(iii) Any waste of the Property, including any physical waste committed or knowingly permitted by Borrower, whether by act or omission, that materially diminishes the value, utility, or condition of the Property or any portion thereof;
(iv) The removal, disposal, transfer, or conveyance of any portion of the Property (including any personal property, fixtures, equipment, or furnishings) in violation of the Loan Documents after the occurrence and during the continuance of an Event of Default under the Loan Agreement, other than removals in the ordinary course of business for purposes of replacing worn or obsolete items with items of equal or greater value and utility;
(v) Any act of arson or other willful or intentional destruction of the Property or any part thereof by or at the direction of Borrower, Guarantor, or any affiliate, agent, employee, or representative of Borrower or Guarantor;
(vi) The failure by Borrower to pay real estate taxes, assessments, or other governmental charges levied or assessed against the Property when and as the same become due and payable, to the extent that Rents and other income from the Property are available and sufficient to pay such taxes, assessments, or charges and are not otherwise required to be deposited into tax or insurance reserve accounts maintained pursuant to the Reserve Agreement;
(vii) The failure by Borrower to maintain the insurance coverages required under the Loan Documents, including without limitation the insurance policies required to be issued by Southland Mutual Insurance Company and Bayfront Specialty Insurance Corp. (or other insurers satisfying the requirements of the Loan Agreement), in the amounts, types, and with the endorsements specified in the Loan Agreement and the Mortgage;
(viii) Any and all liability, losses, damages, costs, expenses, claims, penalties, fines, and remediation obligations arising from or related to (A) the presence, release, threatened release, storage, disposal, generation, transportation, or handling of any Hazardous Materials on, under, in, or about the Property, (B) any violation of any applicable environmental law, rule, regulation, or ordinance with respect to the Property, or (C) any environmental condition at, on, under, or emanating from the Property, in each case as more particularly described in the Environmental Indemnity Agreement of even date herewith (and without limiting the obligations of Borrower and Guarantor under the Environmental Indemnity Agreement). The Parties acknowledge that a Phase I Environmental Site Assessment of the Property was prepared by Oakridge Environmental Consulting Group, Inc. and delivered to Lender prior to the date hereof;
(ix) Any breach of the representations or warranties made by Borrower or Guarantor regarding compliance with the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and the regulations promulgated thereunder, as set forth in the Loan Agreement or any other Loan Document;
(x) Any and all fees, costs, expenses, losses, damages, and amounts incurred by Lender in connection with any bankruptcy, insolvency, reorganization, arrangement, assignment for the benefit of creditors, receivership, or other similar proceeding (whether voluntary or involuntary) commenced by, against, or with respect to Borrower or any affiliate of Borrower (including without limitation any automatic stay or injunction that impedes or delays Lender's exercise of its remedies under the Loan Documents), to the extent that such proceeding was filed, commenced, or solicited by, or is attributable to the actions of, Borrower, Guarantor, or any affiliate, officer, director, member, manager, partner, shareholder, or agent of Borrower or Guarantor; and
(xi) Any failure by Borrower to comply with the single-purpose entity covenants and organizational requirements applicable to Borrower as set forth in the Loan Agreement, including without limitation the covenants requiring Borrower to (A) maintain its existence as a legal entity separate and apart from any other person or entity, (B) not commingle its assets with the assets of any other person or entity, (C) maintain its own books and records and bank accounts, (D) hold itself out to the public as a separate entity, (E) observe all corporate, limited liability company, or other organizational formalities, (F) not guarantee or become obligated for the debts of any other person or entity, and (G) maintain an independent director or manager, as applicable.
(b) The liability of Guarantor under this Section 2.1 with respect to any Carve-Out Event shall be limited to the actual losses, damages, costs, and expenses incurred by Lender as a direct or proximate result of the occurrence of such specific Carve-Out Event. Nothing in this Section 2.1 shall be construed to impose upon Guarantor liability for the entire Indebtedness by reason of the occurrence of a Carve-Out Event; provided, however, that the foregoing limitation shall not apply in the event a Springing Recourse Event has occurred and is continuing under Section 2.2 of this Guaranty.
(c) For the avoidance of doubt, the Carve-Out Events described in this Section 2.1 are separate and independent from, and in addition to, the Springing Recourse Events described in Section 2.2 of this Guaranty, and the occurrence of a Carve-Out Event shall not, in and of itself, constitute a Springing Recourse Event unless such Carve-Out Event is also independently enumerated in Section 2.2.
Section 2.2 — Springing Full Recourse Events
(a) Notwithstanding the limited nature of the guaranty set forth in Section 2.1 of this Guaranty, the Guarantor's liability hereunder shall become fully recourse for the entire Indebtedness and all other obligations of Borrower under the Loan Documents, and the limitations on Guarantor's liability set forth in Section 2.1(b) shall be of no further force or effect, upon the occurrence of any of the following events (each, a "Springing Recourse Event"):
(i) Voluntary Bankruptcy Filing. Any voluntary filing by Borrower or Guarantor (or by any general partner, managing member, or controlling person of Borrower or Guarantor) of a petition for relief under Title 11 of the United States Code (the "Bankruptcy Code"), or any successor statute thereto, or any voluntary filing for relief under any other federal or state bankruptcy, insolvency, reorganization, arrangement, moratorium, receivership, or debtor-relief law, or any voluntary assignment for the benefit of creditors;
(ii) Collusive Involuntary Bankruptcy Filing. The filing of an involuntary petition for relief against Borrower under the Bankruptcy Code or any other applicable bankruptcy, insolvency, or debtor-relief law, which petition is not dismissed within ninety (90) days after the filing thereof, if such filing was collusive or was directly or indirectly solicited, encouraged, aided, abetted, or procured by Borrower, Guarantor, or any affiliate, officer, director, member, manager, partner, shareholder, agent, or representative of Borrower or Guarantor;
(iii) Prohibited Transfer. Any Transfer of all or any part of the Property, or any direct or indirect ownership interest in Borrower (including without limitation any transfer, sale, conveyance, pledge, hypothecation, encumbrance, or other disposition), in violation of the transfer restrictions and prohibitions set forth in the Loan Agreement and the other Loan Documents, without the prior written consent of Lender;
(iv) Prohibited Subordinate Debt. Borrower's incurrence, assumption, or guaranty of any subordinate, junior, or mezzanine debt or indebtedness secured by the Property or by any direct or indirect ownership interest in Borrower, or the granting of any lien, security interest, or encumbrance on the Property or any interest therein (other than the liens and security interests granted to Lender under the Loan Documents and the Permitted Exceptions), without the prior written consent of Lender;
(v) Failure to Maintain Single-Purpose Entity Status. Borrower's failure to maintain its status as a single-purpose entity in compliance with the organizational requirements, covenants, and restrictions set forth in the Loan Agreement, including without limitation any failure to maintain a duly appointed independent director or manager, any commingling of Borrower's assets with the assets of any other person or entity, or any other material violation of the single-purpose entity provisions; and
(vi) Material Breach of Cash Management Agreement. Any material breach by Borrower of the Cash Management Agreement, including without limitation any failure to cause all Rents and other income from the Property to be deposited into the lockbox account established pursuant to the Cash Management Agreement, any unauthorized withdrawal or diversion of funds from such lockbox account or the cash management accounts, or any interference with the operation of the cash sweep mechanisms provided for in the Cash Management Agreement.
(b) Upon the occurrence and during the continuance of any Springing Recourse Event, Guarantor shall be personally liable for the entire outstanding Indebtedness (up to the original principal amount of One Hundred Sixty Million and No/100 Dollars ($160,000,000.00) plus all accrued and unpaid interest (whether at the contract rate or the Default Rate), all prepayment premiums, yield maintenance amounts, exit fees, late charges, costs, expenses (including reasonable attorneys' fees), and all other amounts owing under the Loan Documents), and this Guaranty shall be deemed and treated as a full recourse guaranty of the entire Indebtedness from and after the date of such Springing Recourse Event.
(c) The full recourse liability of Guarantor arising from the occurrence of a Springing Recourse Event shall be in addition to, and not in limitation of, any other liability of Guarantor under this Guaranty (including liability for Carve-Out Events under Section 2.1) or under any other Loan Document, and shall not be subject to any defense, offset, counterclaim, or reduction based on the limited recourse nature of the Loan or the non-recourse provisions of the Loan Agreement or the Note.
Section 2.3 — Nature of Guaranty
(a) This Guaranty is an absolute, unconditional, and irrevocable guaranty of payment and performance, and is not a guaranty of collection. Guarantor acknowledges and agrees that this Guaranty is not conditioned upon Lender first commencing any action or proceeding against Borrower, foreclosing on the Property, realizing upon any collateral, or exhausting any remedies against Borrower, any other guarantor, or any other person or entity before or as a condition to enforcing this Guaranty against Guarantor.
(b) Lender may, in its sole and absolute discretion, proceed directly against Guarantor to collect and enforce the Guaranteed Obligations without first proceeding against Borrower or against or through the Property, and without first pursuing or exhausting any right or remedy that Lender may have against Borrower, any other guarantor, any collateral, or any other person or entity liable for any part of the Indebtedness. The obligations of Guarantor hereunder are independent of the obligations of Borrower under the Loan Documents, and a separate action or actions may be brought and prosecuted against Guarantor whether or not any action is brought or prosecuted against Borrower and whether or not Borrower is joined in any such action or actions.
(c) Guarantor's obligations under this Guaranty shall not be diminished, discharged, or otherwise affected by (i) any lack of validity or enforceability of any Loan Document, (ii) any change in the time, manner, or place of payment or performance, or in any other term, of the Indebtedness or any Loan Document, (iii) any exchange, release, or non-perfection of any collateral, or any release, amendment, or waiver of, or consent to departure from, any other guarantee of the Indebtedness, or (iv) any other circumstance that might otherwise constitute a defense available to, or a discharge of, Borrower or Guarantor.
ARTICLE III — GUARANTOR'S REPRESENTATIONS AND WARRANTIES
Guarantor hereby represents and warrants to Lender as of the date hereof and as of the date of each funding under the Loan as follows:
Section 3.1 — Organization and Good Standing
(a) Guarantor is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware, with full corporate power and authority to own, lease, and operate its properties and to conduct its business as presently conducted.
(b) Guarantor is duly qualified to transact business and is in good standing in the State of Florida and in each other jurisdiction where the nature of its business or the ownership or leasing of its properties requires such qualification, except where the failure to be so qualified would not have a material adverse effect on Guarantor's ability to perform its obligations under this Guaranty.
(c) Guarantor's shares of common stock are publicly traded on The Nasdaq Stock Market LLC under the ticker symbol "VMRK," and Guarantor is subject to the reporting and disclosure requirements of the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Securities and Exchange Commission (the "SEC") promulgated thereunder.
Section 3.2 — Authority; Enforceability
(a) Guarantor has full corporate power and authority to execute, deliver, and perform this Guaranty and each of the other Loan Documents to which Guarantor is a party, and to consummate the transactions contemplated hereby and thereby.
(b) The execution, delivery, and performance by Guarantor of this Guaranty and each of the other Loan Documents to which Guarantor is a party have been duly authorized by all necessary corporate action of Guarantor, including, without limitation, resolutions duly adopted by the board of directors of Guarantor. No other corporate action on the part of Guarantor is necessary to authorize the execution, delivery, and performance of this Guaranty.
(c) This Guaranty has been duly executed and delivered by Guarantor and constitutes the legal, valid, and binding obligation of Guarantor, enforceable against Guarantor in accordance with its terms, subject only to applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general applicability relating to or affecting creditors' rights and to general equitable principles (whether considered in a proceeding in equity or at law).
Section 3.3 — No Conflicts
(a) The execution, delivery, and performance by Guarantor of this Guaranty and the other Loan Documents to which Guarantor is a party do not and will not (i) violate, conflict with, or result in a breach of, or constitute a default (or an event that, with or without notice or lapse of time or both, would constitute a default) under, the certificate of incorporation, bylaws, or other organizational documents of Guarantor, (ii) violate or conflict with any applicable law, statute, rule, regulation, order, judgment, injunction, decree, or governmental requirement applicable to Guarantor or any of its properties or assets, or (iii) violate, conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, or require any notice or consent under, any material agreement, contract, lease, license, or instrument to which Guarantor is a party or by which Guarantor or any of its properties or assets are bound.
(b) No consent, approval, authorization, order, registration, qualification, or filing with any federal, state, local, or foreign governmental authority or regulatory body or any other person or entity is required for the execution, delivery, and performance by Guarantor of this Guaranty or the consummation by Guarantor of the transactions contemplated hereby, other than those that have been duly obtained or made and are in full force and effect on the date hereof.
Section 3.4 — Litigation
There is no action, suit, proceeding, claim, arbitration, mediation, or governmental investigation pending or, to the best of Guarantor's knowledge after due inquiry, threatened against or affecting Guarantor before any court, arbitrator, governmental authority, or administrative body that (a) would, if adversely determined, materially adversely affect Guarantor's financial condition, business, operations, or properties, or (b) would materially adversely affect Guarantor's ability to perform its obligations under this Guaranty or any of the other Loan Documents to which Guarantor is a party.
Section 3.5 — Financial Condition
(a) The financial statements of Guarantor heretofore delivered to Lender, as audited by Keswick & Holt LLP (Andrew Calloway, CPA, engagement partner), have been prepared in accordance with generally accepted accounting principles consistently applied throughout the periods covered thereby, and fairly present in all material respects the financial condition, results of operations, and cash flows of Guarantor and its consolidated subsidiaries as of the dates and for the periods indicated therein.
(b) Since the date of the most recent audited financial statements of Guarantor delivered to Lender, there has been no material adverse change in the financial condition, business, operations, assets, liabilities, or prospects of Guarantor or any of its consolidated subsidiaries. Without limiting the foregoing, as of the date of its most recent audited financial statements, Guarantor reported consolidated revenue of approximately Four Hundred Eighty-Seven Million and No/100 Dollars ($487,000,000.00) and a total enterprise value of approximately One Billion Nine Hundred Million and No/100 Dollars ($1,900,000,000.00).
(c) All financial projections, budgets, and pro forma statements, if any, furnished by Guarantor to Lender in connection with the Loan were prepared in good faith on the basis of assumptions believed by Guarantor to be reasonable at the time of preparation, and represent Guarantor's good faith estimates as of the date thereof (it being understood that such projections are forward-looking in nature and that actual results may differ from projected results).
Section 3.6 — Solvency
Guarantor is, and after giving effect to the execution and delivery of this Guaranty and the consummation of the transactions contemplated hereby will be, solvent. As used herein, "solvent" means that (a) the fair saleable value of Guarantor's assets exceeds the amount of Guarantor's liabilities (including contingent liabilities), (b) Guarantor is able to pay its debts as they become due, and (c) Guarantor does not have unreasonably small capital to conduct its business as presently conducted and as contemplated to be conducted.
Section 3.7 — No Bankruptcy
No petition in bankruptcy, whether voluntary or involuntary, and no proceeding for reorganization, arrangement, composition with creditors, assignment for the benefit of creditors, receivership, dissolution, liquidation, or similar proceeding under any applicable federal, state, or foreign law has been filed by or against Guarantor, and Guarantor is not contemplating the filing of any such petition or proceeding and is not aware of any facts or circumstances that would form the basis for the filing of any such petition or proceeding.
Section 3.8 — ERISA
(a) Guarantor is in compliance in all material respects with all applicable requirements of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and the Internal Revenue Code of 1986, as amended (the "Code"), with respect to each "employee benefit plan" (as defined in Section 3(3) of ERISA) maintained, sponsored, or contributed to by Guarantor or any of its "ERISA Affiliates" (as defined in the Loan Agreement).
(b) No ERISA event has occurred or is reasonably expected to occur that has resulted in or could reasonably be expected to result in a material liability to Guarantor or any of its ERISA Affiliates, including without limitation (i) any "reportable event" (within the meaning of Section 4043 of ERISA), (ii) any "accumulated funding deficiency" (within the meaning of Section 302 of ERISA or Section 412 of the Code), (iii) any withdrawal liability under Section 4201 of ERISA, or (iv) any termination of a "defined benefit plan" (within the meaning of Section 3(35) of ERISA) subject to Title IV of ERISA.
(c) None of the assets of Guarantor constitute or will constitute "plan assets" (within the meaning of 29 C.F.R. Section 2510.3-101, as modified by Section 3(42) of ERISA) of any employee benefit plan.
Section 3.9 — Taxes
Guarantor has timely filed all federal, state, local, and foreign tax returns and reports that are required to be filed by Guarantor, and has paid all taxes, assessments, fees, and other governmental charges due and payable by Guarantor (including, without limitation, all income, franchise, employment, sales, use, excise, and property taxes), except for such taxes, assessments, fees, and charges that are being contested in good faith by appropriate proceedings and for which adequate reserves have been established on Guarantor's books and financial statements in accordance with generally accepted accounting principles. No tax lien has been filed against any property or assets of Guarantor, and no claim is being asserted in writing by any taxing authority with respect to any taxes of Guarantor.
Section 3.10 — Anti-Money Laundering; OFAC
(a) Guarantor is in compliance with all applicable anti-money laundering laws, rules, and regulations, including without limitation the Bank Secrecy Act (31 U.S.C. §§ 5311 et seq.), the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (the "USA PATRIOT Act") (Pub. L. 107-56), and all regulations promulgated thereunder.
(b) Neither Guarantor nor any of its affiliates, directors, officers, employees, or agents is a person or entity (i) whose name appears on the Specially Designated Nationals and blocked Persons List maintained by the Office of Foreign Assets Control of the United States Department of the Treasury ("OFAC"), the lists maintained by the United Nations Security Council, or any other list of prohibited or restricted parties maintained by any governmental authority (each, a "Prohibited Person"), (ii) that is owned or controlled by, or acts for or on behalf of, any Prohibited Person, (iii) with whom dealings are prohibited or restricted under any sanctions laws, executive orders, or regulations administered by OFAC, the U.S. Department of State, the European Union, or Her Majesty's Treasury of the United Kingdom, or (iv) located, organized, or resident in a country or territory that is the subject of comprehensive OFAC sanctions (including, as of the date hereof, Cuba, Iran, North Korea, Syria, and the Crimea, Donetsk, and Luhansk regions of Ukraine).
(c) Guarantor has implemented and maintains policies, procedures, and internal controls that are reasonably designed to ensure compliance with the anti-money laundering and sanctions laws and regulations referred to in this Section 3.10.
Section 3.11 — Benefit
Guarantor acknowledges and confirms that (a) Guarantor is the indirect parent of Borrower and has a substantial direct and indirect ownership interest in Borrower, (b) the making of the Loan by Lender to Borrower will provide substantial direct and indirect economic benefit to Guarantor, including without limitation through the enhancement of the value of Guarantor's investment in Borrower and the operations of the Property, and (c) Guarantor has had the opportunity to review the Loan Documents and is fully familiar with the terms and conditions thereof.
ARTICLE IV — COVENANTS OF GUARANTOR
Guarantor hereby covenants and agrees with Lender that, so long as any portion of the Indebtedness remains outstanding or any obligation of Guarantor under this Guaranty remains unsatisfied:
Section 4.1 — Financial Reporting
Guarantor shall deliver to Lender, at Guarantor's sole cost and expense, each of the following:
(a) Annual Audited Financial Statements. Within one hundred twenty (120) days after the end of each fiscal year of Guarantor, annual consolidated and consolidating financial statements of Guarantor and its subsidiaries for such fiscal year, including a consolidated balance sheet, statement of income, statement of cash flows, and statement of stockholders' equity, together with the notes thereto, all prepared in accordance with generally accepted accounting principles consistently applied, audited by Keswick & Holt LLP, or another independent certified public accounting firm of national reputation and standing reasonably acceptable to Lender, and accompanied by the unqualified report and opinion of such accounting firm. Such financial statements shall be certified by Guarantor's chief financial officer as being true, correct, and complete in all material respects.
(b) Quarterly Unaudited Financial Statements. Within sixty (60) days after the end of each of the first three (3) fiscal quarters of each fiscal year of Guarantor, unaudited consolidated financial statements of Guarantor and its subsidiaries for such fiscal quarter, including a condensed consolidated balance sheet, statement of income, and statement of cash flows, prepared in accordance with generally accepted accounting principles consistently applied (subject to normal year-end adjustments and the absence of footnotes), and certified by Guarantor's chief financial officer as being true, correct, and complete in all material respects.
(c) Annual Corporate Financial Statement. Within one hundred twenty (120) days after the end of each fiscal year of Guarantor, a corporate financial statement of Guarantor, in form and substance reasonably acceptable to Lender, setting forth in reasonable detail the assets, liabilities, net worth, and liquidity of Guarantor as of the end of such fiscal year, certified by Guarantor's chief financial officer.
(d) SEC Filings. Promptly upon the filing thereof (and in any event within five (5) business days after such filing), copies of all Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements, and other reports or filings filed by Guarantor with the SEC, together with all exhibits thereto. Guarantor, being a company listed on The Nasdaq Stock Market LLC under the ticker symbol "VMRK," acknowledges that Lender may independently monitor Guarantor's public filings through the SEC's EDGAR system; provided, however, that Lender's ability to access such filings through EDGAR shall not relieve Guarantor of its obligation to deliver copies thereof to Lender as required by this Section 4.1(d).
(e) Other Information. Such other financial information and documentation as Lender may reasonably request from time to time, including without limitation schedules of contingent liabilities, details of indebtedness, and information regarding material contracts and agreements.
Section 4.2 — Net Worth / Liquidity Covenants
Guarantor shall maintain at all times during the term of the Loan the following minimum financial thresholds:
(a) Minimum Net Worth. A net worth (as determined in accordance with generally accepted accounting principles consistently applied, calculated as total assets minus total liabilities) of not less than $[__] (the "Minimum Net Worth Requirement"). For purposes of this Section 4.2(a), net worth shall be determined on a consolidated basis and shall exclude goodwill, intangible assets, and any assets pledged to secure obligations of persons or entities other than Guarantor and its consolidated subsidiaries.
(b) Minimum Liquidity. Liquidity (defined as the sum of (i) unrestricted cash and cash equivalents held by Guarantor plus (ii) unused and available commitments under Guarantor's revolving credit facilities (to the extent such facilities are committed and not subject to conditions that have not been satisfied)) of not less than $[__] (the "Minimum Liquidity Requirement").
(c) Testing and Certification. Compliance with the Minimum Net Worth Requirement and the Minimum Liquidity Requirement shall be tested and certified by Guarantor's chief financial officer on a quarterly basis, with such certifications to be delivered concurrently with the quarterly financial statements required under Section 4.1(b) and the annual financial statements required under Section 4.1(a).
(d) Default. Any failure by Guarantor to satisfy the Minimum Net Worth Requirement or the Minimum Liquidity Requirement shall constitute an immediate Event of Default under this Guaranty without notice or opportunity to cure, and may, if so provided in the Loan Agreement, constitute a Springing Recourse Event.
Section 4.3 — Existence; Compliance with Laws
(a) Guarantor shall maintain its corporate existence and good standing under the laws of the State of Delaware and its qualification to transact business and good standing in the State of Florida and in each other jurisdiction where such qualification is required for the conduct of Guarantor's business or the ownership or leasing of its properties, except where the failure to maintain such qualification would not have a material adverse effect on Guarantor's ability to perform its obligations under this Guaranty.
(b) Guarantor shall comply in all material respects with all applicable laws, statutes, rules, regulations, orders, judgments, injunctions, decrees, and governmental requirements (including, without limitation, all environmental laws, ERISA, the USA PATRIOT Act, OFAC sanctions, and securities laws and regulations applicable to Guarantor as a Nasdaq-listed company), the non-compliance with which could reasonably be expected to have a material adverse effect on Guarantor's financial condition, business, operations, or properties, or on Guarantor's ability to perform its obligations under this Guaranty.
Section 4.4 — Notice of Material Events
Guarantor shall promptly, and in any event within five (5) business days after Guarantor has knowledge thereof, deliver written notice to Lender of:
(a) The occurrence or existence of any Springing Recourse Event or any Carve-Out Event, or any event or condition that, with the giving of notice or the passage of time, or both, would constitute a Springing Recourse Event or a Carve-Out Event, together with a description of the nature and extent thereof and the actions being taken or proposed to be taken by Guarantor in connection therewith;
(b) The commencement or written threat of any material litigation, arbitration, mediation, or governmental investigation against or affecting Guarantor, including any action, suit, or proceeding that, if adversely determined, could reasonably be expected to result in a liability to Guarantor in excess of Five Million and No/100 Dollars ($5,000,000.00) individually or Ten Million and No/100 Dollars ($10,000,000.00) in the aggregate;
(c) Any material adverse change in the financial condition, business, operations, assets, liabilities, or prospects of Guarantor, including without limitation any downgrade of Guarantor's credit rating by any nationally recognized rating agency, any default or event of default under any other material indebtedness of Guarantor, or any material impairment of Guarantor's ability to perform its obligations under this Guaranty; and
(d) Any change in the ownership structure of Guarantor that results in a change of control (as such term is defined in Guarantor's organizational documents or in any applicable shareholders' agreement or voting agreement), or any merger, consolidation, reorganization, or similar transaction involving Guarantor.
Section 4.5 — No Dissolution or Merger
Guarantor shall not dissolve, liquidate, wind up its affairs, or cease to conduct business, and shall not merge with or into, or consolidate with, any other person or entity, without the prior written consent of Lender; provided, however, that Lender's consent shall not be required for any merger or consolidation in which (a) Guarantor is the surviving entity, (b) the surviving entity assumes in writing, in form and substance reasonably satisfactory to Lender, all obligations of Guarantor under this Guaranty and the other Loan Documents to which Guarantor is a party, (c) the surviving entity maintains, immediately after giving effect to such merger or consolidation, a net worth at least equal to the greater of (i) the Minimum Net Worth Requirement and (ii) the net worth of Guarantor immediately prior to such merger or consolidation, and (d) the surviving entity maintains, immediately after giving effect to such merger or consolidation, liquidity at least equal to the greater of (i) the Minimum Liquidity Requirement and (ii) the liquidity of Guarantor immediately prior to such merger or consolidation.
Section 4.6 — Taxes
Guarantor shall timely file all federal, state, local, and foreign tax returns and reports required to be filed by Guarantor and shall timely pay all taxes, assessments, fees, and other governmental charges assessed or levied against Guarantor or any of its properties or assets, as the same become due and payable, except for such taxes, assessments, fees, and charges that are being contested in good faith by appropriate proceedings and for which adequate reserves have been established on Guarantor's books and financial statements in accordance with generally accepted accounting principles. Guarantor shall promptly pay any tax lien or encumbrance that may be filed against any of its properties or assets.
ARTICLE V — WAIVERS BY GUARANTOR
Section 5.1 — Waivers
Guarantor hereby unconditionally and irrevocably waives, to the fullest extent permitted by applicable law, each and every one of the following:
(a) Notice of Acceptance. Any requirement that Lender notify Guarantor of Lender's acceptance of this Guaranty. Guarantor acknowledges that this Guaranty shall be deemed accepted by Lender upon the execution and delivery hereof.
(b) Presentment, Demand, and Protest. Presentment for payment, demand for payment, protest, and notice of presentment, demand, protest, nonpayment, and dishonor, and any and all other notices or demands of any kind in connection with the Indebtedness, the Loan Documents, or this Guaranty, except as expressly provided herein.
(c) Notice of Default. Notice of any default or Event of Default under the Loan Documents (other than any notice expressly required to be given by Lender to Guarantor pursuant to the express terms of this Guaranty).
(d) Notice of Modification. Notice of any amendment, modification, supplement, extension, renewal, rearrangement, increase, or decrease of the Loan Documents or the Indebtedness, including without limitation any increase in the interest rate from the initial fixed rate of five and thirty-five hundredths percent (5.35%) per annum to the Default Rate or any other rate, any change in the amortization schedule from interest-only payments during the first two (2) years of the Loan term to payments of principal and interest on a thirty (30)-year amortization schedule during years three (3) through five (5) of the Loan term, any modification of the maturity date, or any exercise by Borrower of the two (2) one (1)-year extension options available under the Loan Agreement (subject to satisfaction of the extension conditions, including a minimum Debt Service Coverage Ratio of 1.25x and payment of the extension fee of twenty-five hundredths of one percent (0.25%) of the then-outstanding principal balance of the Loan).
(e) Notice of Release or Substitution. Notice of any release, substitution, exchange, impairment, or addition of any collateral securing the Indebtedness, or any release, substitution, or addition of any other guarantor or obligor with respect to the Indebtedness.
(f) Requirement to Proceed Against Borrower. Any right to require Lender to (i) proceed against Borrower before proceeding against Guarantor, (ii) proceed against or exhaust any collateral, security, or other guaranty held by Lender before proceeding against Guarantor, (iii) join Borrower or any other person or entity in any action against Guarantor, or (iv) pursue any other remedy in Lender's power whatsoever before proceeding against Guarantor.
(g) Statute of Limitations. Any defense based on any statute of limitations in any action or proceeding arising out of or related to this Guaranty, to the fullest extent permitted by law.
(h) Suretyship Defenses. Any and all suretyship defenses, rights, and remedies generally, including without limitation any defense arising under Sections 673.6051, 673.4191, 673.5011, 679.6021, or any other provision of the Florida Statutes (including the Florida Uniform Commercial Code), and any defense that would be available to a surety or guarantor under the common law of the State of Florida or any other applicable jurisdiction.
(i) Defense of Borrower's Disability. Any defense arising by reason of any disability, lack of capacity, incapacity, lack of authority, death, dissolution, bankruptcy, insolvency, or any other defense of Borrower, or by reason of the cessation from any cause of the liability of Borrower under the Loan Documents (other than the indefeasible payment in full of the Indebtedness and the satisfaction in full of all other obligations under the Loan Documents).
(j) Subrogation, Contribution, and Indemnification. Any right of subrogation, contribution, indemnification, reimbursement, or similar right that Guarantor may have against Borrower or against any other person or entity or any collateral or security, and any right to enforce any remedy that Lender may have against Borrower or any other person or entity, in each case until the Indebtedness has been indefeasibly paid and satisfied in full and the Loan Documents have been fully terminated. If, notwithstanding the foregoing, any payment is made to Guarantor on account of any such subrogation, contribution, indemnification, or reimbursement right prior to the indefeasible payment in full of the Indebtedness, such payment shall be held by Guarantor in trust for Lender and shall be promptly turned over to Lender in the form received (properly endorsed or assigned, if necessary) to be applied to the Indebtedness, whether matured or unmatured.
(k) marshaling. Any right to require the marshaling of assets or to require Lender to resort to any particular asset or collateral before resorting to any other asset or collateral or before proceeding against Guarantor.
(l) Election of Remedies. Any defense arising from Lender's election of any remedy against Borrower or any collateral, including without limitation any defense based on Lender's election to proceed by nonjudicial foreclosure under the Mortgage pursuant to applicable Florida law, and any defense arising from Lender's failure to realize upon any collateral or to take any action that might result in the release or discharge of Guarantor's obligations hereunder.
Section 5.2 — Guarantor's Understanding
(a) Guarantor acknowledges and confirms that Guarantor has independently reviewed and is fully familiar with the terms, conditions, and provisions of each of the Loan Documents, including without limitation the Loan Agreement, the Note, the Mortgage, the Environmental Indemnity Agreement, the Cash Management Agreement, and the Reserve Agreement, and that Guarantor has had the opportunity to consult with legal counsel of Guarantor's choice with respect to the terms and provisions of this Guaranty and each of the other Loan Documents.
(b) Guarantor acknowledges and confirms that Guarantor has independently reviewed and is fully familiar with the financial condition of Borrower and the condition, value, and prospects of the Property, and that Guarantor has made its own assessment of the creditworthiness of Borrower and the value and condition of the Property without reliance on any information provided by Lender. Guarantor is not relying on Lender or Lender's counsel, Whitford Baines & Driscoll LLP, to supply any such information to Guarantor, and Lender shall have no obligation to provide any such information to Guarantor, whether now or at any time in the future.
(c) Guarantor acknowledges that Lender would not make the Loan to Borrower without this Guaranty and that the consideration received by Guarantor for the execution and delivery of this Guaranty is sufficient.
ARTICLE VI — SUBORDINATION OF GUARANTOR'S CLAIMS
Section 6.1 — Subordination
Any and all indebtedness, liabilities, and obligations of Borrower to Guarantor, whether now existing or hereafter arising, whether direct or indirect, absolute or contingent, liquidated or unliquidated, secured or unsecured, and howsoever evidenced (including without limitation any loans, advances, management fees, dividends, distributions, intercompany charges, or other amounts owed by Borrower to Guarantor) (collectively, the "Subordinated Claims"), are hereby subordinated in right of payment, priority, and enforcement to the prior indefeasible payment and satisfaction in full of the Indebtedness owed by Borrower to Lender under the Loan Documents. Guarantor shall not demand, accept, receive, collect, or enforce any payment on account of any Subordinated Claim, whether in cash, property, by set-off, or otherwise, until the Indebtedness has been indefeasibly paid and satisfied in full and the Loan Documents have been fully terminated, without the prior written consent of Lender. Nothing in this Section 6.1 shall prohibit Borrower from making distributions to its members or equity owners (including indirect distributions through intermediate entities to Guarantor) to the extent expressly permitted under the Loan Agreement and the Cash Management Agreement, provided that no Event of Default has occurred and is continuing under the Loan Documents at the time of any such distribution.
Section 6.2 — Turnover of Payments
In the event that Guarantor receives any payment, distribution, or other value on account of any Subordinated Claim in violation of Section 6.1 of this Guaranty, whether received by Guarantor from Borrower, any trustee, receiver, liquidator, custodian, or similar official, or any other person or entity, Guarantor shall receive and hold the same in trust for the benefit of Lender, shall immediately notify Lender of the receipt thereof, and shall promptly turn over and deliver the same to Lender in the form received (properly endorsed or assigned to Lender, if necessary) to be applied by Lender to the Indebtedness (whether matured or unmatured) in such order and manner as Lender may determine in its sole discretion. In the event of the failure of Guarantor to make any such endorsement, assignment, or delivery, Lender is hereby irrevocably authorized to make the same on behalf of Guarantor.
ARTICLE VII — LENDER'S RIGHTS; NO IMPAIRMENT OF GUARANTY
Section 7.1 — Lender's Rights
Lender may, at any time and from time to time, in Lender's sole and absolute discretion, without notice to or consent of Guarantor, and without in any way affecting, impairing, diminishing, releasing, or discharging the obligations of Guarantor under this Guaranty:
(a) Amend, modify, supplement, extend, renew, restate, increase, decrease, or otherwise change any one or more of the terms, conditions, covenants, or provisions of the Loan Documents, including without limitation the terms of repayment, interest rate, maturity date, amortization schedule, prepayment provisions, reserve requirements, insurance requirements, property management requirements, or any other provision thereof;
(b) Increase or decrease the interest rate applicable to the Loan (currently a fixed rate of five and thirty-five hundredths percent (5.35%) per annum), whether by agreement with Borrower, as a result of the application of any Default Rate, or otherwise;
(c) Grant one or more extensions of the maturity date of the Loan or any portion thereof, including without limitation the two (2) one (1)-year extension options available under the Loan Agreement (each subject to the satisfaction of certain conditions precedent, including a minimum Debt Service Coverage Ratio of not less than 1.25x and payment of an extension fee equal to twenty-five hundredths of one percent (0.25%) of the then-outstanding principal balance of the Loan);
(d) Release, surrender, exchange, substitute, compromise, settle, impair, subordinate, or otherwise deal with, in any manner and in any order, any collateral or security for the Indebtedness or any part thereof, including the Property;
(e) Release, discharge, or waive any obligation of any other guarantor, surety, co-maker, endorser, or other person or entity at any time liable for the payment or performance of the Indebtedness or any part thereof;
(f) Apply any sums received by Lender from or on behalf of Borrower, any guarantor, or any other person or entity, or from the disposition of any collateral, to the Indebtedness in any order, manner, or priority as Lender may determine in its sole discretion, regardless of whether such sums are attributable to principal, interest, fees, costs, expenses, or any other component of the Indebtedness;
(g) Settle, compromise, release, compound, or adjust any claims that Lender may have against Borrower or against any other person or entity liable for the Indebtedness or any part thereof;
(h) Take or refrain from taking any action under the Loan Documents or with respect to the Property, including without limitation exercising or refraining from exercising any right

CONFIDENTIAL — DRAFT — FOR DISCUSSION PURPOSES ONLY

GUARANTY AGREEMENT

GUARANTY AGREEMENT

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WHEREAS:

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