INTERCREDITOR AGREEMENT
by and between
IRONCLAD NATIONAL BANK, N.A., as Administrative Agent for the Senior Lenders
and
GRANITE PEAK CAPITAL PARTNERS, LP, as Mezzanine Lender
Dated as of June 15, 2025
Hudson Yards West — 450 West 34th Street, New York, New York 10001
INTERCREDITOR AGREEMENT
This INTERCREDITOR AGREEMENT (this "Agreement") is made and entered into as of June 15, 2025, by and between IRONCLAD NATIONAL BANK, N.A., a national banking association chartered under the laws of the United States, having its principal office at 277 Park Avenue, New York, New York 10172, in its capacity as Administrative Agent for the Senior Lenders (as defined below) (together with its successors and assigns in such capacity, the "Senior Agent"), and GRANITE PEAK CAPITAL PARTNERS, LP, a Delaware limited partnership, having its principal office at 9 West 57th Street, Suite 4200, New York, New York 10019, as mezzanine lender (together with its successors and assigns, the "Mezzanine Lender"). The Senior Agent and the Mezzanine Lender are each referred to herein as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS, Hudson Yards West Mortgage LLC, a Delaware limited liability company (the "Mortgage Borrower"), has obtained a senior mortgage loan in the original principal amount of Four Hundred Seventy-Five Million and 00/100 Dollars ($475,000,000) (the "Senior Loan") from the lenders party to the Senior Loan Agreement (as defined below) (collectively, the "Senior Lenders"), for which the Senior Agent acts as administrative agent, secured by, among other things, a first-priority mortgage lien and security interest in certain real property located at 450 West 34th Street, New York, New York 10001 (Block 729, Lots 1, 5, 12, and 15, Borough of Manhattan, City, County, and State of New York) (the "Property");
WHEREAS, Hudson Yards West Mezzanine LLC, a Delaware limited liability company (the "Mezzanine Borrower"), is the sole member of the Mortgage Borrower, and has obtained a mezzanine loan in the original principal amount of Two Hundred Million and 00/100 Dollars ($200,000,000) (the "Mezzanine Loan") from the Mezzanine Lender, secured by a first-priority pledge of one hundred percent (100%) of the membership interests of the Mortgage Borrower held by the Mezzanine Borrower (the "Pledged Collateral");
WHEREAS, Metropolitan Transit Development Corp., an Illinois government instrumentality ("MTDC" or the "Sponsor"), is the sole member of the Mezzanine Borrower and the indirect owner of the Mortgage Borrower;
WHEREAS, the total project cost for the development of the Property is approximately Nine Hundred Twenty Million and 00/100 Dollars ($920,000,000), consisting of the Senior Loan ($475,000,000), the Mezzanine Loan ($200,000,000), MTDC equity contributions ($200,000,000), and a New York City Transit Infrastructure Grant ($45,000,000);
WHEREAS, the Property has been appraised at an as-stabilized value of One Billion Twenty-Five Million and 00/100 Dollars ($1,025,000,000) (Broadstreet Appraisal Group, Inc., File No. BAG-25-1092, dated April 1, 2025), yielding a combined loan-to-value ratio of approximately 65.85%;
WHEREAS, the Parties desire to set forth their agreement regarding the relative priorities, rights, remedies, and interests of the Senior Agent (on behalf of the Senior Lenders) and the Mezzanine Lender with respect to the Senior Loan, the Mezzanine Loan, and the related collateral securing the same; and
WHEREAS, it is a condition to the closing of the Senior Loan and the Mezzanine Loan that the Parties execute and deliver this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
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ARTICLE 1 — DEFINITIONS
Section 1.1 — Defined Terms.
As used in this Agreement, the following terms shall have the meanings set forth below:
"Agreement" means this Intercreditor Agreement, as it may be amended, restated, supplemented, or otherwise modified from time to time in accordance with the terms hereof.
"Assignment of Leases and Rents" means that certain Assignment of Leases and Rents, dated as of the date hereof, executed by the Mortgage Borrower in favor of the Senior Agent, as the same may be amended, restated, supplemented, or otherwise modified from time to time.
"Bankruptcy Code" means Title 11 of the United States Code, 11 U.S.C. §§ 101 et seq., as amended from time to time, and any successor statute thereto.
"Bankruptcy Proceeding" means the filing or commencement of any case or proceeding under the Bankruptcy Code, or any comparable state insolvency, reorganization, moratorium, receivership, assignment for the benefit of creditors, or similar debtor-relief statute, by or against the Mortgage Borrower, the Mezzanine Borrower, or MTDC, whether voluntary or involuntary.
"Business Day" means any day other than a Saturday, Sunday, or any other day on which commercial banks in the City of New York, State of New York, are authorized or required by law, regulation, or executive order to close.
"Cash Management Agreement" means that certain Cash Management Agreement, dated as of the date hereof, among the Mortgage Borrower, the Senior Agent, and the depository bank identified therein, as the same may be amended, restated, supplemented, or otherwise modified from time to time.
"Collateral" means, collectively, the Senior Collateral and the Mezzanine Collateral, as the context may require.
"Combined Debt" means the aggregate outstanding principal balance of the Senior Loan and the Mezzanine Loan at any given time.
"Combined Debt Yield" means, for any period, the ratio of (a) the net operating income from the Property for such period to (b) the Combined Debt, expressed as a percentage.
"Combined LTV" means the ratio of (a) the Combined Debt to (b) the appraised value of the Property as determined in accordance with the Senior Loan Documents, expressed as a percentage.
"Cure Period" has the meaning set forth in Section 6.1 of this Agreement.
"DSCR" means the debt service coverage ratio as defined in the Senior Loan Agreement, calculated on the basis of the Combined Debt.
"Default" means any event, condition, or circumstance that, with the giving of notice or the lapse of time or both, would constitute an Event of Default under the applicable Loan Documents.
"Default Rate" means the default rate of interest as set forth in each respective set of Loan Documents.
"Environmental Indemnity" means that certain Environmental Indemnity Agreement, dated as of the date hereof, executed by the Mortgage Borrower and MTDC in favor of the Senior Agent, as the same may be amended, restated, supplemented, or otherwise modified from time to time.
"Event of Default" means an event of default as defined under the Senior Loan Documents or the Mezzanine Loan Documents, as the context requires, after the expiration of any applicable notice and cure periods set forth therein.
"GMP Contract" means that certain Guaranteed Maximum Price Construction Contract (No. CCG-HYW-2025-001), dated as of March 1, 2025, between the Mortgage Borrower, as owner, and Cobalt Construction Group, Inc., as general contractor, providing for a guaranteed maximum price of Four Hundred Twelve Million and 00/100 Dollars ($412,000,000), as the same may be amended, modified, or supplemented from time to time.
"Ground Lease" means that certain ground lease dated June 1, 2020, between the New York City Economic Development Corporation ("NYCEDC"), as ground lessor, and MTDC (or its designee), as ground lessee, recorded in the Office of the City Register of the City of New York at City Register File Number ("CRFN") 2020000198762, as the same may be amended, modified, or supplemented from time to time in accordance with the terms hereof.
"Guaranty" means that certain Guaranty Agreement, dated as of the date hereof, executed by MTDC in favor of the Senior Agent for the benefit of the Senior Lenders, as the same may be amended, restated, supplemented, or otherwise modified from time to time.
"Loan Documents" means, collectively, the Senior Loan Documents and the Mezzanine Loan Documents.
"Mezzanine Borrower" means Hudson Yards West Mezzanine LLC, a Delaware limited liability company, together with its successors and permitted assigns.
"Mezzanine Collateral" means the Pledged Collateral and all other collateral now or hereafter securing the Mezzanine Loan, including all proceeds thereof.
"Mezzanine Cure" has the meaning set forth in Section 6.2 of this Agreement.
"Mezzanine Default Notice" has the meaning set forth in Section 5.2 of this Agreement.
"Mezzanine Event of Default" means an Event of Default under the Mezzanine Loan Documents.
"Mezzanine Guaranty" means that certain Mezzanine Guaranty Agreement, dated as of the date hereof, executed by MTDC in favor of the Mezzanine Lender, as the same may be amended, restated, supplemented, or otherwise modified from time to time.
"Mezzanine Loan" means the mezzanine loan in the original principal amount of Two Hundred Million and 00/100 Dollars ($200,000,000) made by the Mezzanine Lender to the Mezzanine Borrower pursuant to the Mezzanine Loan Agreement.
"Mezzanine Loan Agreement" means that certain Mezzanine Loan Agreement, dated as of the date hereof, between the Mezzanine Borrower and the Mezzanine Lender, as the same may be amended, restated, supplemented, or otherwise modified from time to time in accordance with the terms hereof.
"Mezzanine Loan Documents" means the Mezzanine Loan Agreement, the Mezzanine Promissory Note, the Pledge and Security Agreement, the Mezzanine Guaranty, the Mezzanine Environmental Indemnity, and all other documents, instruments, and agreements executed and delivered in connection therewith, as each may be amended, restated, supplemented, or otherwise modified from time to time.
"Mezzanine Promissory Note" means that certain Mezzanine Promissory Note, dated as of the date hereof, made by the Mezzanine Borrower in favor of the Mezzanine Lender in the principal amount of $200,000,000.
"Mortgage" means that certain Mortgage, Assignment of Leases and Rents, Security Agreement, and Fixture Filing, dated as of the date hereof, executed by the Mortgage Borrower in favor of the Senior Agent, encumbering the Property, as the same may be amended, restated, supplemented, or otherwise modified from time to time.
"Mortgage Borrower" means Hudson Yards West Mortgage LLC, a Delaware limited liability company, together with its successors and permitted assigns.
"MTDC" or "Sponsor" means Metropolitan Transit Development Corp., an Illinois government instrumentality.
"NYCEDC" means the New York City Economic Development Corporation.
"OFAC" means the United States Department of the Treasury's Office of Foreign Assets Control.
"Option Closing Date" has the meaning set forth in Section 7.2 of this Agreement.
"Option Exercise Notice" has the meaning set forth in Section 7.2 of this Agreement.
"Payment blockage Notice" means a written notice delivered by the Senior Agent to the Mezzanine Lender in substantially the form of Exhibit E attached hereto, notifying the Mezzanine Lender that a Senior Event of Default has occurred and directing the cessation of payments on the Mezzanine Loan.
"Payment blockage Period" has the meaning set forth in Section 3.2 of this Agreement.
"Permitted Mezzanine Modifications" has the meaning set forth in Section 8.2 of this Agreement.
"Permitted Senior Modifications" has the meaning set forth in Section 8.1 of this Agreement.
"Person" means any individual, corporation, limited liability company, partnership (general or limited), joint venture, association, trust, unincorporated organization, government or governmental agency or instrumentality, or any other legal entity of any kind.
"Pledge and Security Agreement" means that certain Pledge and Security Agreement, dated as of the date hereof, executed by the Mezzanine Borrower in favor of the Mezzanine Lender, pledging 100% of the membership interests of the Mortgage Borrower held by the Mezzanine Borrower, as the same may be amended, restated, supplemented, or otherwise modified from time to time.
"Pledged Collateral" means one hundred percent (100%) of the membership interests in the Mortgage Borrower now or hereafter held by the Mezzanine Borrower, together with all rights, powers, privileges, and interests related thereto, including all distributions and proceeds thereof.
"Prohibited Person" means any Person that is (a) listed on the Specially Designated Nationals and blocked Persons List maintained by OFAC, (b) a Person with whom dealings are prohibited or restricted under any sanctions program administered by OFAC, (c) owned or controlled by any such Person, or (d) acting on behalf of any such Person.
"Property" means the real property located at 450 West 34th Street, New York, New York 10001 (Block 729, Lots 1, 5, 12, and 15, Borough of Manhattan, City, County, and State of New York), together with all improvements, buildings, structures, fixtures, equipment, and appurtenances now or hereafter located thereon, and all easements, rights-of-way, and other rights appurtenant thereto.
"Purchase Option" has the meaning set forth in Section 7.1 of this Agreement.
"Purchase Price" has the meaning set forth in Section 7.3 of this Agreement.
"Qualified Transferee" has the meaning set forth in Section 10.2 of this Agreement.
"Qualified Transferee Certificate" means a certificate in substantially the form of Exhibit C attached hereto.
"Senior Collateral" means the Property and all other collateral now or hereafter securing the Senior Loan, including all proceeds thereof, but expressly excluding the Pledged Collateral.
"Senior Event of Default" means an Event of Default under the Senior Loan Documents.
"Senior Lenders" means the lenders from time to time party to the Senior Loan Agreement, together with their respective successors and assigns.
"Senior Loan" means the senior mortgage loan in the original principal amount of Four Hundred Seventy-Five Million and 00/100 Dollars ($475,000,000) made by the Senior Lenders to the Mortgage Borrower pursuant to the Senior Loan Agreement.
"Senior Loan Agreement" means that certain Senior Loan Agreement, dated as of the date hereof, among the Mortgage Borrower, the Senior Agent, and the Senior Lenders, as the same may be amended, restated, supplemented, or otherwise modified from time to time in accordance with the terms hereof.
"Senior Loan Documents" means the Senior Loan Agreement, the Senior Promissory Note(s), the Mortgage, the Assignment of Leases and Rents, the Cash Management Agreement, the Environmental Indemnity, the Guaranty, the Deposit Account Control Agreement(s), and all other documents, instruments, and agreements executed and delivered in connection therewith, as each may be amended, restated, supplemented, or otherwise modified from time to time.
"Senior Promissory Note(s)" means the promissory note or notes, dated as of the date hereof, made by the Mortgage Borrower in favor of the Senior Agent and the Senior Lenders in the aggregate principal amount of $475,000,000.
"SOFR" means the Secured Overnight Financing Rate as administered by the Federal Reserve Bank of New York (or a successor administrator).
"SPE" means special purpose entity, as such concept is described in the organizational documents of the Mortgage Borrower and the Mezzanine Borrower and the Senior Loan Documents.
"Standstill Period" has the meaning set forth in Section 5.2 of this Agreement.
"Term SOFR" means the forward-looking term rate based on SOFR, as published by CME Group Benchmark Administration Limited (or a successor administrator) and determined in accordance with the Senior Loan Agreement.
"UCC" means the Uniform Commercial Code as in effect from time to time in the State of New York (or, to the extent applicable, the State of Delaware or any other relevant jurisdiction).
Section 1.2 — Rules of Construction.
(a) The headings and captions of the Articles, Sections, and Exhibits of this Agreement are for convenience of reference only and shall not be considered in interpreting or construing this Agreement.
(b) Whenever the context so requires, the singular number shall include the plural, the plural number shall include the singular, and the use of any gender shall include all genders.
(c) The word "including" (and all grammatical variations thereof) shall mean "including, without limitation" or "including, but not limited to," and shall not be construed to limit any general statement that it follows to the specific or similar items or matters immediately following it.
(d) References to "Sections," "Articles," and "Exhibits" are to Sections, Articles, and Exhibits of this Agreement, unless otherwise specified.
(e) References to any agreement, document, or instrument shall mean such agreement, document, or instrument as amended, restated, supplemented, or otherwise modified from time to time in accordance with the terms thereof and, where applicable, in accordance with the terms hereof.
(f) References to any law or statute shall mean such law or statute as amended, supplemented, or otherwise modified from time to time, and all rules, regulations, and interpretations promulgated thereunder.
(g) The terms defined in the UCC and not otherwise defined herein shall have the meanings ascribed to them in the UCC.
(h) Defined terms from the Senior Loan Documents and the Mezzanine Loan Documents are incorporated herein by reference to the extent not inconsistent with the definitions set forth in Section 1.1 above; in the event of any conflict between the definitions in this Agreement and those in the Senior Loan Documents or the Mezzanine Loan Documents, the definitions in this Agreement shall control.
(i) References to a "writing" or "written" include electronic mail and any other form of electronic transmission that produces a tangible record.
(j) The Parties have participated jointly in the negotiation and drafting of this Agreement, and no rule of construction or interpretation that would require any ambiguity to be construed against the drafter shall apply to this Agreement.
ARTICLE 2 — PRIORITY OF LIENS AND COLLATERAL
Section 2.1 — Acknowledgment of Separate Collateral Packages.
The Parties acknowledge and agree that the Senior Loan and the Mezzanine Loan are secured by distinct and separate collateral packages. The Senior Loan is secured by the Mortgage and related liens and security interests in the Property and all other Senior Collateral, as more fully described in the Senior Loan Documents. The Mezzanine Loan is secured by the pledge of one hundred percent (100%) of the membership interests of the Mortgage Borrower held by the Mezzanine Borrower and all other Mezzanine Collateral, as more fully described in the Mezzanine Loan Documents. The Parties acknowledge that the Senior Collateral and the Mezzanine Collateral constitute distinct collateral packages and that neither Party has, nor shall acquire, any lien on or security interest in the other Party's collateral except as expressly provided herein or in the respective Loan Documents.
Section 2.2 — Priority of Senior Loan.
The Senior Loan and all obligations of the Mortgage Borrower thereunder (including, without limitation, all principal, interest, fees, costs, expenses, indemnification obligations, and other amounts payable under the Senior Loan Documents) shall be senior and prior in right of payment and priority to the Mezzanine Loan and all obligations of the Mezzanine Borrower thereunder. The lien of the Mortgage and all security interests in the Senior Collateral granted to or held by the Senior Agent for the benefit of the Senior Lenders are, and shall at all times remain, senior and prior to any interest, right, or claim of the Mezzanine Lender in any portion of the Senior Collateral. The Mezzanine Lender hereby acknowledges and agrees that it has no lien on, security interest in, or other claim to, any Senior Collateral, and shall not assert any such lien, security interest, or claim against any Senior Collateral at any time. The priority established by this Section 2.2 shall not be altered, modified, or impaired by any act or omission of either Party, including, without limitation, any failure to perfect a lien or security interest or any subordination, release, or waiver.
Section 2.3 — Priority of Mezzanine Lender's Interest in Pledged Collateral.
The Senior Agent, on behalf of the Senior Lenders, hereby acknowledges and agrees that it has no lien on, security interest in, or other claim to, the Pledged Collateral (i.e., the membership interests in the Mortgage Borrower held by the Mezzanine Borrower). The Mezzanine Lender's security interest in the Pledged Collateral is prior and superior to any interest that the Senior Agent or the Senior Lenders may have therein. Nothing in this Agreement or in the Senior Loan Documents shall be construed to create or grant to the Senior Agent or the Senior Lenders any lien on or security interest in the Pledged Collateral, and the Senior Agent shall not assert any such lien or security interest.
Section 2.4 — No marshaling.
Neither Party shall be required to marshal any collateral securing its respective Loan, and each Party hereby irrevocably waives any right of marshaling with respect to the other Party's collateral. Without limiting the generality of the foregoing, the Senior Agent shall have no obligation to proceed against or realize upon any particular item of Senior Collateral in any particular order or manner, and the Mezzanine Lender shall have no right to direct the order or manner in which the Senior Agent proceeds against or realizes upon the Senior Collateral. Similarly, the Mezzanine Lender shall have no obligation to proceed against the Pledged Collateral in any particular order or manner, and the Senior Agent shall have no right to direct the order or manner in which the Mezzanine Lender proceeds against the Pledged Collateral.
Section 2.5 — Subordination of Mezzanine Debt to Senior Debt.
Notwithstanding the existence of separate collateral packages, in any Bankruptcy Proceeding, receivership, or other insolvency or liquidation proceeding involving the Mortgage Borrower:
(a) All Senior Loan obligations shall be indefeasibly paid in full in cash before any payment or distribution of any kind (whether in cash, securities, or other property) is made on account of the Mezzanine Loan from or with respect to any Senior Collateral or any assets or property of the Mortgage Borrower;
(b) The Mezzanine Lender shall not assert, prove, or receive any distribution from Senior Collateral or any assets or property of the Mortgage Borrower on account of the Mezzanine Loan until all Senior Loan obligations have been indefeasibly paid in full in cash;
(c) Any payment or distribution of any kind received by the Mezzanine Lender from Senior Collateral or any assets or property of the Mortgage Borrower in contravention of this Section 2.5 shall be held in trust by the Mezzanine Lender for the benefit of the Senior Agent and shall be promptly turned over to the Senior Agent in the form received (duly endorsed or assigned, as applicable) for application to the Senior Loan obligations in such order as the Senior Agent may determine; and
(d) The subordination provisions of this Section 2.5 shall apply solely to distributions from or with respect to Senior Collateral and assets or property of the Mortgage Borrower and shall not limit the Mezzanine Lender's right to receive distributions from Mezzanine Collateral or to exercise its remedies against the Mezzanine Borrower and the Pledged Collateral, subject in each case to the other provisions of this Agreement.
Section 2.6 — UCC Priorities.
Any UCC financing statements filed by the Mezzanine Lender with the Delaware Secretary of State or any other filing office with respect to the Pledged Collateral shall not be deemed to create, evidence, or perfect any lien on or security interest in the Senior Collateral, and the Parties acknowledge that such financing statements relate solely to the Mezzanine Collateral. The Senior Agent may, but shall not be required to, file a protective UCC financing statement against the Mezzanine Borrower's interest in the Mortgage Borrower; any such protective filing shall not be deemed to constitute a lien on the Pledged Collateral or to modify the priorities established by this Article 2. Each Party agrees to cooperate with the other in connection with any corrective or termination filings necessary to ensure that UCC filings accurately reflect the collateral arrangements described herein.
ARTICLE 3 — PAYMENTS; APPLICATION OF PROCEEDS
Section 3.1 — Permitted Payments on Mezzanine Loan.
So long as no Senior Event of Default has occurred and is continuing, and so long as no Payment blockage Notice has been delivered by the Senior Agent to the Mezzanine Lender and remains in effect, the Mezzanine Borrower may make, and the Mezzanine Lender may receive, regularly scheduled payments of interest (at the rate of 11.50% fixed per annum, as set forth in the Mezzanine Loan Agreement), fees, expenses, and other amounts due and payable under the Mezzanine Loan Documents, in each case at the times and in the amounts specified therein. Nothing in this Section 3.1 shall be construed to create any obligation on the part of the Mortgage Borrower, the Senior Agent, or the Senior Lenders to make any payments on account of the Mezzanine Loan.
Section 3.2 — Blockage of Mezzanine Payments During Senior Default.
Upon the occurrence and during the continuance of a Senior Event of Default, and upon and after the delivery by the Senior Agent of a Payment blockage Notice to the Mezzanine Lender in substantially the form attached hereto as Exhibit E:
(a) No payments of principal, interest, fees, expenses, or any other amounts may be made by or on behalf of the Mezzanine Borrower on, or with respect to, the Mezzanine Loan, and the Mezzanine Lender shall not accept, receive, or retain any such payments;
(b) The payment blockage imposed by this Section 3.2 (the "Payment blockage Period") shall continue from the date of the Mezzanine Lender's receipt of the Payment blockage Notice until the earliest to occur of: (i) the date on which such Senior Event of Default is cured or waived in writing by the Senior Agent; (ii) one hundred eighty (180) days after the date of the Mezzanine Lender's receipt of the Payment blockage Notice; or (iii) the date on which the Senior Loan is indefeasibly paid in full in cash;
(c) No more than one (1) Payment blockage Period shall be in effect during any three hundred sixty-five (365)-day period; and
(d) The Senior Agent shall not deliver successive Payment blockage Notices with respect to the same Senior Event of Default that gave rise to a prior Payment blockage Notice; provided that the foregoing shall not prevent the Senior Agent from delivering a new Payment blockage Notice based on a different Senior Event of Default, subject to the limitation set forth in clause (c) above.
Upon the expiration or termination of the Payment blockage Period, the Mezzanine Borrower may resume, and the Mezzanine Lender may accept, all regularly scheduled payments under the Mezzanine Loan Documents, including any payments that were deferred or accumulated during the Payment blockage Period to the extent the Mezzanine Loan Documents so provide.
Section 3.3 — Turnover of Improper Payments.
If the Mezzanine Lender receives any payment (whether of principal, interest, fees, or otherwise) on account of the Mezzanine Loan during a Payment blockage Period or otherwise in violation of Section 3.2, the Mezzanine Lender shall hold such payment in trust for the benefit of the Senior Agent and shall promptly (and in any event within three (3) Business Days of receipt) deliver and turn over such payment to the Senior Agent, in the form received (with any necessary endorsements), for application by the Senior Agent to the Senior Loan obligations in such order and manner as the Senior Agent may determine in its sole discretion. The obligation to turn over improper payments under this Section 3.3 shall survive the termination of this Agreement until all Senior Loan obligations have been indefeasibly paid in full in cash.
Section 3.4 — Distributions from Senior Collateral.
All casualty and condemnation proceeds, insurance proceeds, and any other proceeds from or attributable to the Senior Collateral, including any amounts realized upon any sale, disposition, or other realization upon any Senior Collateral (whether voluntary, by foreclosure, or otherwise), shall be applied, held, and disbursed solely in accordance with the Senior Loan Documents. The Mezzanine Lender shall have no claim to, lien on, or security interest in any such proceeds, and shall not be entitled to receive any distribution from any such proceeds, until the Senior Loan is indefeasibly paid in full in cash. This Section 3.4 shall not limit the Mezzanine Lender's right to exercise its remedies against the Mezzanine Collateral in accordance with this Agreement.
Section 3.5 — Cash Management.
The Mezzanine Lender hereby acknowledges and consents to the hard lockbox and springing cash sweep mechanism implemented under the Cash Management Agreement. The Mezzanine Lender has reviewed the cash management waterfall set forth in the Cash Management Agreement and acknowledges that, upon the occurrence of a cash sweep trigger event (including a DSCR falling below 1.10x on a trailing twelve-month basis or the occurrence and continuance of a Senior Event of Default), all excess cash flow from the Property shall be swept and applied to the Senior Loan obligations in accordance with the Cash Management Agreement and the Senior Loan Documents. The Mezzanine Lender shall not interfere with, obstruct, or otherwise impair the operation of the cash management waterfall or any lockbox, blocked account, or reserve account established under the Cash Management Agreement. The Mezzanine Lender acknowledges that its right to receive payments under the Mezzanine Loan Documents is subject to and subordinate to the operation of the cash management waterfall described herein.
ARTICLE 4 — REPRESENTATIONS AND WARRANTIES
Section 4.1 — Representations of Each Party.
Each Party hereby represents and warrants to the other Party, as of the date hereof, as follows:
(a) Organization and Good Standing. Such Party is duly organized (or, in the case of the Senior Agent, duly chartered), validly existing, and in good standing under the laws of its jurisdiction of organization or chartering (in the case of the Senior Agent, a national banking association chartered and existing under the laws of the United States and supervised by the Office of the Comptroller of the Currency; in the case of the Mezzanine Lender, a limited partnership duly formed and existing under the Delaware Revised Uniform Limited Partnership Act).
(b) Authority and Capacity. Such Party has full power, authority, and legal right to execute, deliver, and perform this Agreement and to consummate the transactions contemplated hereby. The execution, delivery, and performance of this Agreement by such Party have been duly authorized by all necessary corporate, partnership, or other organizational action on the part of such Party.
(c) Enforceability. This Agreement constitutes the legal, valid, and binding obligation of such Party, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer, and other similar laws affecting creditors' rights generally, and to general principles of equity (whether considered in a proceeding in equity or at law).
(d) No Violation. The execution, delivery, and performance by such Party of this Agreement do not and will not (i) violate any provision of such Party's organizational documents (including its charter, certificate of formation, certificate of limited partnership, limited partnership agreement, operating agreement, or bylaws, as applicable), (ii) violate any applicable law, rule, regulation, order, judgment, or decree to which such Party is subject, or (iii) conflict with, result in a breach of, or constitute a default under any material agreement, instrument, or obligation to which such Party is a party or by which it or its assets are bound.
Section 4.2 — Senior Agent Representations.
The Senior Agent hereby represents and warrants to the Mezzanine Lender, as of the date hereof, as follows:
(a) The Senior Loan is in the original principal amount of Four Hundred Seventy-Five Million and 00/100 Dollars ($475,000,000).
(b) The Senior Agent has been duly appointed as administrative agent under and pursuant to the Senior Loan Agreement, and has full authority to act in such capacity and to execute this Agreement on behalf of the Senior Lenders.
(c) True, correct, and complete copies of the Senior Loan Documents (in form substantially final as of the date hereof) have been delivered to the Mezzanine Lender prior to the execution of this Agreement. Such copies are complete and unmodified and accurately reflect the terms and conditions of the Senior Loan as of the date hereof.
(d) No Senior Event of Default exists as of the date hereof, and the Senior Agent has no knowledge of any condition, event, or circumstance that, with the giving of notice or the lapse of time or both, would constitute a Senior Event of Default.
Section 4.3 — Mezzanine Lender Representations.
The Mezzanine Lender hereby represents and warrants to the Senior Agent, as of the date hereof, as follows:
(a) The Mezzanine Loan is in the original principal amount of Two Hundred Million and 00/100 Dollars ($200,000,000).
(b) True, correct, and complete copies of the Mezzanine Loan Documents (in form substantially final as of the date hereof) have been delivered to the Senior Agent prior to the execution of this Agreement. Such copies are complete and unmodified and accurately reflect the terms and conditions of the Mezzanine Loan as of the date hereof.
(c) No Mezzanine Event of Default exists as of the date hereof, and the Mezzanine Lender has no knowledge of any condition, event, or circumstance that, with the giving of notice or the lapse of time or both, would constitute a Mezzanine Event of Default.
(d) Granite Peak Capital Partners, LP holds one hundred percent (100%) of the Mezzanine Loan. No portion of the Mezzanine Loan has been assigned, participated, or otherwise transferred to any other Person as of the date hereof.
ARTICLE 5 — STANDSTILL AND MEZZANINE LENDER'S EXERCISE OF REMEDIES
Section 5.1 — Mezzanine Lender's Remedies Subject to Restrictions.
The Mezzanine Lender acknowledges and agrees that its rights to exercise remedies under the Mezzanine Loan Documents shall be subject to the restrictions, standstill requirements, and notice obligations set forth in this Article 5. Without limiting the generality of the foregoing, the Mezzanine Lender may not exercise any remedies under the Mezzanine Loan Documents — including, without limitation, conducting a UCC foreclosure sale of the Pledged Collateral, accepting a strict foreclosure or transfer in lieu of foreclosure of the Pledged Collateral, accelerating the Mezzanine Loan, applying for the appointment of a receiver for the Mezzanine Borrower or its assets, commencing or joining in any Bankruptcy Proceeding against the Mezzanine Borrower, or exercising any voting rights as a secured party with respect to the membership interests of the Mortgage Borrower — except in strict compliance with the standstill and notice requirements of this Article 5.
Section 5.2 — Standstill Period.
Upon the occurrence of a Mezzanine Event of Default, the Mezzanine Lender shall deliver written notice thereof to the Senior Agent (a "Mezzanine Default Notice"), which notice shall include a reasonably detailed description of the Mezzanine Event of Default, including the nature thereof, the date of occurrence, and the provisions of the Mezzanine Loan Documents that have been breached. The Mezzanine Lender may not exercise any remedies under the Mezzanine Loan Documents until the later of:
(a) sixty (60) days after delivery of the Mezzanine Default Notice to the Senior Agent; or
(b) the expiration of any applicable cure period under the Mezzanine Loan Documents available to the Mezzanine Borrower or any guarantor thereunder
(the period determined pursuant to clauses (a) and (b) above, the "Standstill Period"); provided, however, that:
(i) the Standstill Period shall be extended to ninety (90) days if the applicable Mezzanine Event of Default is a monetary default (including a failure to pay principal, interest, or any other sum due under the Mezzanine Loan Documents) and the defaulting party is diligently pursuing a cure of such monetary default;
(ii) notwithstanding the foregoing, the Standstill Period shall terminate immediately and without further notice or action if a Bankruptcy Proceeding is commenced by or against the Mezzanine Borrower during the Standstill Period;
(iii) the Standstill Period shall be extended to one hundred twenty (120) days if the Senior Agent notifies the Mezzanine Lender in writing within fifteen (15) days after the Senior Agent's receipt of the Mezzanine Default Notice that the Senior Agent elects the extended Standstill Period and is evaluating whether to exercise the Purchase Option under Article 7 of this Agreement. If the Senior Agent delivers such notice, the Senior Agent shall use commercially reasonable efforts to complete its evaluation and notify the Mezzanine Lender of its decision with respect to the Purchase Option within such extended period; and
(iv) in no event shall the aggregate duration of the Standstill Period (including all extensions) exceed one hundred twenty (120) days from the date of delivery of the Mezzanine Default Notice, except in the case of an extension under clause (iii) above.
Section 5.3 — Permitted Exercises After Standstill.
After the expiration or termination of the Standstill Period (and provided that the applicable Mezzanine Event of Default has not been cured during the Standstill Period), the Mezzanine Lender may exercise any and all of its rights and remedies under the Mezzanine Loan Documents, the Pledge and Security Agreement, the UCC, and applicable law; provided, however, that:
(a) Any transferee of the Pledged Collateral (whether by UCC public sale, private sale, strict foreclosure, or otherwise) must satisfy the Qualified Transferee requirements set forth in Section 10.2 of this Agreement and must deliver a Qualified Transferee Certificate in substantially the form of Exhibit C attached hereto;
(b) Any such transferee must assume, in writing, all obligations of the Mezzanine Borrower (as sole member of the Mortgage Borrower) under the Senior Loan Documents and this Agreement, and must agree to be bound by the terms and conditions hereof;
(c) The Mezzanine Lender shall provide the Senior Agent with not less than ten (10) Business Days' prior written notice of any UCC sale (including the date, time, and location of such sale) and shall provide the Senior Agent with a copy of any commercially reasonable notification of disposition required under Article 9 of the UCC; and
(d) The Mezzanine Lender shall conduct any UCC sale in a commercially reasonable manner in compliance with all applicable provisions of the UCC and other applicable law.
Section 5.4 — No Mezzanine Foreclosure on Senior Collateral.
The Mezzanine Lender shall not, at any time, levy, execute upon, attach, garnish, or foreclose upon (or seek to levy, execute upon, attach, garnish, or foreclose upon) any Senior Collateral, including, without limitation, the Property, any improvements thereon, any rents, issues, or profits therefrom, or any other assets or property of the Mortgage Borrower. The Mezzanine Lender's sole remedy with respect to the underlying Property is the indirect remedy of foreclosure on the Pledged Collateral (i.e., the membership interests of the Mortgage Borrower held by the Mezzanine Borrower), subject in all cases to the terms and conditions of this Agreement.
Section 5.5 — Mezzanine Lender's Right to Enforce After Senior Default.
If a Senior Event of Default has occurred and the Senior Agent has accelerated the Senior Loan and commenced foreclosure proceedings on the Property or other enforcement actions with respect to the Senior Collateral, the Mezzanine Lender's standstill obligations under Section 5.2 of this Agreement shall remain in full force and effect. During such period, the Mezzanine Lender may exercise the Purchase Option under Article 7 or cure the Senior Event of Default under Article 6 in accordance with the terms thereof, but shall not be permitted to exercise independent remedies against the Mezzanine Collateral unless and until the applicable Standstill Period has expired or terminated. Nothing in this Section 5.5 shall be construed to limit or impair the Mezzanine Lender's rights under Article 6 or Article 7 of this Agreement.
ARTICLE 6 — CURE RIGHTS
Section 6.1 — Mezzanine Lender's Right to Cure Senior Defaults.
Upon the occurrence of a Senior Event of Default, the Senior Agent shall promptly deliver written notice thereof to the Mezzanine Lender (which notice shall include a reasonably detailed description of the nature of such Senior Event of Default and the provisions of the Senior Loan Documents that have been breached), and the Senior Agent shall deliver such notice in any event within five (5) Business Days of the occurrence of such Senior Event of Default (or, if the Senior Agent does not have actual knowledge of the occurrence of such Senior Event of Default, within five (5) Business Days of obtaining such actual knowledge). Upon receipt of such notice, the Mezzanine Lender shall have the right, but not the obligation, to cure such Senior Event of Default within the following periods (collectively, the "Cure Period"):
(a) Monetary Defaults. With respect to any Senior Event of Default arising from the failure by the Mortgage Borrower to pay any principal, interest, fees, or other monetary obligations when due under the Senior Loan Documents, the Mezzanine Lender shall have ten (10) Business Days after receipt of the notice from the Senior Agent to cure such monetary default by paying to the Senior Agent the full amount then due and owing.
(b) Non-Monetary Defaults Capable of Cure. With respect to any Senior Event of Default arising from the breach of a non-monetary covenant, condition, or obligation under the Senior Loan Documents that is susceptible of cure, the Mezzanine Lender shall have thirty (30) days after receipt of the notice from the Senior Agent to cure such non-monetary default; provided, however, that if such cure cannot reasonably be completed within thirty (30) days despite diligent pursuit, such period shall be extended for an additional thirty (30) days (up to a total of sixty (60) days from receipt of the notice), so long as the Mezzanine Lender has commenced the cure within the initial thirty (30)-day period and is diligently prosecuting the same to completion.
(c) Bankruptcy Events. With respect to any Senior Event of Default arising from the filing or commencement of an involuntary Bankruptcy Proceeding against the Mortgage Borrower or the Mezzanine Borrower, the Mezzanine Lender shall have fifteen (15) Business Days after receipt of the notice from the Senior Agent solely to take such actions as may be necessary or appropriate to seek the dismissal of such involuntary Bankruptcy Proceeding.
During the applicable Cure Period, so long as the Mezzanine Lender is diligently pursuing a cure, the Senior Agent shall not exercise any remedies under the Senior Loan Documents with respect to such Senior Event of Default (other than the imposition of the Default Rate or the delivery of a Payment blockage Notice under Section 3.2 of this Agreement); provided that the foregoing shall not apply if the Senior Agent reasonably determines that the delay in exercising remedies would materially and adversely impair the value of the Senior Collateral.
Section 6.2 — Effect of Cure.
A cure tendered by the Mezzanine Lender in accordance with Section 6.1 and accepted by the Senior Agent (such acceptance not to be unreasonably withheld, conditioned, or delayed) shall be deemed to constitute a cure by the Mortgage Borrower for purposes of the Senior Loan Documents, and the Senior Event of Default that was the subject of such cure shall be deemed to have been remedied (a "Mezzanine Cure"). Upon the effectiveness of a Mezzanine Cure, the Senior Agent shall promptly confirm in writing to the Mezzanine Lender that the applicable Senior Event of Default has been cured. Notwithstanding the foregoing, the Senior Agent shall not be required to accept a cure that does not fully remedy the applicable Senior Event of Default in accordance with the requirements of the Senior Loan Documents, and the Senior Agent's determination of whether a cure is sufficient shall be reasonable and made in good faith.
Section 6.3 — Senior Agent's Right to Cure Mezzanine Defaults.
The Senior Agent shall have the right, but not the obligation, to cure any Mezzanine Event of Default, within the following periods:
(a) Monetary Defaults. With respect to any Mezzanine Event of Default arising from the failure by the Mezzanine Borrower to pay any principal, interest, fees, or other monetary obligations when due under the Mezzanine Loan Documents, the Senior Agent shall have ten (10) Business Days after receipt of notice from the Mezzanine Lender (or, if earlier, after actual knowledge of such default) to cure such monetary default by paying to the Mezzanine Lender the full amount then due and owing.
(b) Non-Monetary Defaults. With respect to any Mezzanine Event of Default arising from the breach of a non-monetary covenant, condition, or obligation under the Mezzanine Loan Documents, the Senior Agent shall have thirty (30) days after receipt of notice from the Mezzanine Lender (or, if earlier, after actual knowledge of such default) to cure such non-monetary default.
Any and all amounts advanced by the Senior Agent in connection with curing a Mezzanine Event of Default pursuant to this Section 6.3 shall be deemed additional obligations of the Mortgage Borrower under the Senior Loan, shall be added to the outstanding balance of the Senior Loan, shall be secured by the Senior Collateral, and shall bear interest at the Default Rate under the Senior Loan Documents from the date of such advance until repaid in full. The Mezzanine Lender shall accept any cure tendered by the Senior Agent in accordance with this Section 6.3 that fully remedies the applicable Mezzanine Event of Default and shall promptly confirm in writing to the Senior Agent that the applicable Mezzanine Event of Default has been cured.
Section 6.4 — Notice Obligations.
Each Party shall promptly notify the other Party in writing of each of the following events, and in no event later than five (5) Business Days after the notifying Party has actual knowledge of the occurrence thereof:
(a) The occurrence of any Event of Default under its respective Loan Documents;
(b) Any acceleration of its respective Loan;
(c) Any commencement of foreclosure proceedings, UCC sale proceedings, or application for the appointment of a receiver;
(d) The commencement of any Bankruptcy Proceeding involving the Mortgage Borrower, the Mezzanine Borrower, or MTDC;
(e) Any material casualty affecting the Property or any condemnation or threatened condemnation of all or any material portion of the Property; and
(f) Any other event or circumstance that such Party reasonably believes is likely to have a material adverse effect on the Property, the Senior Collateral, the Mezzanine Collateral, or the ability of the Mortgage Borrower or the Mezzanine Borrower to perform its obligations under the applicable Loan Documents.
Any notice delivered pursuant to this Section 6.4 shall include a reasonably detailed description of the event or circumstance and the provisions of the applicable Loan Documents implicated thereby.
ARTICLE 7 — PURCHASE OPTION
Section 7.1 — Grant of Purchase Option.
The Senior Agent, on behalf of the Senior Lenders, hereby grants to the Mezzanine Lender an irrevocable option (the "Purchase Option") to purchase all (but not less than all) of the Senior Loan, including all of the Senior Loan Documents, all liens and security interests granted thereunder, and all obligations of the Mortgage Borrower and any guarantor or indemnitor thereunder, exercisable upon the occurrence of any of the following trigger events:
(a) The acceleration of the Senior Loan by the Senior Agent following a Senior Event of Default;
(b) The commencement of foreclosure proceedings by the Senior Agent on the Property (including the filing of a lis pendens or commencement of a foreclosure action);
(c) The appointment or application for the appointment of a receiver for the Property at the request of the Senior Agent; or
(d) The commencement of a Bankruptcy Proceeding by or against the Mortgage Borrower.
The Purchase Option shall be available to the Mezzanine Lender upon the occurrence of any one or more of the foregoing trigger events, and the Senior Agent shall promptly notify the Mezzanine Lender in writing of the occurrence of any such trigger event.