LENDER'S SUBORDINATION, NONDISTURBANCE AND ATTORNMENT AGREEMENT

Transcription

1 LENDER'S SUBORDINATION, NONDISTURBANCE AND ATTORNMENT AGREEMENT THIS SUBORDINATION, NONDISTURBANCE AND ATTORNMENT AGREEMENT (this "Agreement") is made and entered into as of February 20, 2004 by and among 400 WALNUT GREENTREE ASSOCIATES, LP, a Pennsylvania limited partnership (the "Master Lessee"); 400 WALNUT ASSOCIATES, a Pennsylvania limited partnership ("Owner"); INDEPENDENCE COMMUNITY BANK, a New York banking corporation (together with any permitted successors or assigns, the "Lender"); and CHEVRON TCI, INC., a California corporation (the "Investor"). RECITALS WHEREAS, Owner is the owner of real prop~rty located at and commonly known as 400 Walnut Street, Philadelphia, Pennsylvania (the "Building"); and WHEREAS, the certain tract(s) of land upon which the Building is located, more particularly described in Exhibit A attached hereto, together with certain other improvements and all appurtenances, easements, rights of way and other rights belonging to or in any way pertaining thereto or to the Building are hereinafter collectively referred to as the "Land" and, together with the Building, the "Property"; and WHEREAS, Owner intends to rehabilitate the Building in a manner that qualifies for the historic rehabilitation tax credit allowed for qualified rehabilitation expenditures incurred in connection with the "certified rehabilitation" of a "certified historic structure" (the "Historic Tax Credit") pursuant to the Section 47 of the Internal Revenue Code of 1986, as amended from time to time, or any corresponding provision or provisions ofprior or succeeding law (the "Code"); and WHEREAS, the Master Lessee has been formed to lease the Property including the rehabilitated Building from Owner pursuant to the terms of that certain Master Lease dated as of May 29,2002 between Owner, as landlord, and the Master Lessee, as lessee (the "Master Lease"), the form of which Master Lease has been approved by Lender; and WHEREAS, pursuant to that certain Limited Partnership Agreement of the Master Lessee dated May 29, 2002 (the "Limited Partnership Agreement"), the Investor has acquired an interest in the Master Lessee and will make an investment therein; and Form Page A-I I Fannie Mae

2 WHEREAS, Owner and the Master Lessee have executed or will execute that certain HTC Pass-Through Agreement (the "Pass-Through Agreement") dated as of May 29, 2002 pursuant to which Owner will elect under Section 50 of the Code to pass-through to the Master Lessee the Historic Tax Credit to which Owner is otherwise entitled as a result of the rehabilitation of the Building; and WHEREAS, the Lender is the lender under that certain Loan Agreement dated February 20, 2004 by and between Lender and Owner pursuant to which Lender agrees to make a mortgage loan to Owner in the aggregate amount of $13,125, (the "Mortgage Loan"), which Mortgage Loan is secured by means of a first lien mortgage or deed of trust and other related security documents and financing statements given by Owner in favor of the Lender, as amended (collectively, the "Mortgage"); and WHEREAS, the Mortgage Loan requires that Lender consent to any lease of the Property. NOW, THEREFORE, in consideration of the forgoing, of mutual promises of the parties hereto and of other good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, the Lender hereby consents as follows: 1. Defined Terms. Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Master Lease. In addition to the defined terms set forth in the Recitals to this Agreement, the following defined terms used herein shall have the meanings specified below: "Transfer" means (a) the institution of any foreclosure, trustee's sale or other like proceeding, (b) the appointment of a receiver for Owner or the Property, (c) the exercise of rights to collect rents under the Mortgage or an assignment of rents, (d) the recording by Lender or its successor or assignee of a deed in lieu of foreclosure for the property, or (e) any transfer or abandonment of possession of the Property to the Lender or its successor or assigns in connection with any proceedings affecting Owner under the Bankruptcy Code, 11 U.S.C. 101 et seq. "Transferee" means the Lender or any other party taking title to the Property in connection with a Transfer. 2. Consents. The Lender hereby consents to the Master Lease and agrees that the existence thereof shall not constitute a default under the Mortgage Loan. 3. Subordination. The Mortgage is and shall unconditionally be and remain at all times a lien or charge upon the Property prior and superior to the Form Page A I Fannie Mae

3 Master Lease and all rights and privileges of the Master Lessee, or any subtenant thereunder, and the Master Lease, and all rights and privileges of the Master Lessee or any subtentant are hereby unconditionally subjected and made subordinate to the lien or charge of the Mortgage. 4. Lender's Exercise of Remedies: Non-Disturbance. (a) Subject to Section 4(c) hereof, provided (a) the Master Lessee complies with this Agreement, (b) the Master Lessee is not in default under the terms of the Master Lease and no event has occurred which, with the passage of time or the giving of notice or both, would constitute a default under the Master Lease, (c) the Master Lease is in full force and effect, both as of the date the Lender files a lis pendens, or otherwise commences a Transfer, and at all times thereafter, and (d) the Master Lessee shall be in possession of the Property, no default under the Mortgage and no Transfer will disturb the Master Lessee's possession under the Master Lease and the Master Lease will not be affected or terminated thereby, and notwithstanding any such foreclosure or other Transfer of the Property to a Transferee, the Master Lease will be recognized as a direct lease from Transferee to the Master Lessee upon the Transfer for the balance ofthe term thereof. (b) In the event that the Master Lease is recognized as a direct lease from a Transferee as aforesaid, then the liability of a Transferee under the Master Lease shall exist only so long as such Transferee is the owner of the Property, and such liability shall not continue or survive with respect to claims accruing after further transfer of ownership. A Transferee shall not be: (i) liable for any act or omission of any prior landlord (including Owner), (ii) subject to any offsets or counterclaims which the Master Lessee may have against a prior landlord <including Owner), unless expressly provided for herein; (iii) bound by any prepayment of Base Rent which the Master Lessee may have made in excess of the amounts then due for the next succeeding month, unless specifically approved in writing by the Lender, or be liable or responsible for any security deposit or other sums which the Master Lessee may have paid under the Master Lease unless such deposit or other sums have been physically delivered to Transferee, Gv) bound by any notices given by the Master Lessee to Owner of which it did not also receive notice, (v) required after a fire, casualty or condemnation of the Property to repair or rebuild the same to the extent that such repair or rebuilding requires funds in excess of the insurance or condemnation proceeds specifically allocable to the Property and arising out of such fire, casualty or condemnation which have actually been received by a Transferee, and then only to the extent required by the terms ofthe Master Lease, (vi) bound by any modification to the Master Lease made without Lender's consent, (vii) required to undertake or complete any oflandlord's Work, or (viii) responsible to provide any additional space at the Property or elsewhere for which the Master Lessee has any FANNIE MAE MULTIFAMILY SECURITY INSTRUMENT Form Page A I Fannie Mae

4 option or right under the Master Lease, or otherwise, unless the Transferee at its option elects to provide the same, and the Master Lessee hereby releases the Transferee from any obligation to provide the same, and agrees that the Master Lessee shall have no right to cancel the Master Lease and shall possess no right to any claim against a Transferee as a result of the failure to provide any such additional space (ix) liable for or bound by any indemnity provision of whatever nature contained in the Lease, including but not limited to, any environmental indemnification. This provision shall be applicable to the Lender, its successor's or assigns, or its nominee only and shall not be applicable to any third party purchasing the premises from the Lender. (c) Notwithstanding anything herein to the contrary, the Lender agrees that it will take no action to effect a termination of the Master Lease without first giving to the Investor reasonable time, not to exceed thirty (30) days from the date of the Investor's receipt of notice of the intention by the Lender to take any action that would effect a termination, to replace the Master Lessee's managing member and cause the successor managing member to cause Owner to cure any defect in the Master Lessee's compliance with the terms of Section 4(a) hereof, such that upon such cure the Master Lease would be entitled to the non-disturbance benefits of Section 4(a). 5. Attornment. The Master Lessee shall attorn to any Transferee, including the Lender ifthe Lender becomes a Transferee, as the landlord under the Master Lease. Said attornment is subject to the limitation of Transferee's obligations set forth in Section 4(a) above and shall be effective and self-operative without the execution of any further instruments upon Transferee succeeding to the interest of the landlord under the Master Lease. Within ten (10) days after receipt of a written request therefor from a Transferee, the Master Lessee agrees to provide such Transferee with a written confirmation of its attornment and any other matter set forth in this Agreement. Failure to provide such written confirmation shall, at the Transferee's sole option, constitute a default under the Master Lease, but failure to receive such a written confirmation from the Master Lessee shall not derogate from the Master Lessee's obligations to the Transferee hereunder. 6. Notice and Cure Rights. (a) The Master Lessee and Owner each agrees, simultaneously with the giving of any notice under the Master Lease, to give a duplicate copy thereof to each Lender (the Default Notice"). Should either Owner or the Master Lessee default in respect of any ofthe provisions of the Master Lease, the Lender shall have the right, but not the obligation, to cure such default, and either the Master Lessee or Owner, as the case may be, shall accept performance by or on behalf of the Lender as Form /01 Page A-4

5 though, and with the same effect as if, it had been done or performed by the defaulting party. The Lender will have a period of time after the service of such notice upon it within which to cure the default specified in such notice, or cause it to be cured, which is the same period for cure, if any, as is given under the Master Lease in respect of the specified default after the giving of any required notice thereunder. After Lender receives a Default Notice, Lender shall have a period of ten (10) days beyond the time available to Owner under the Master Lease in which to cure the breach or default by Owner. In addition, as to any breach or default by the Owner the cure of which requires possession and control of Property, provided only that Lender undertakes to Master Lessee by written notice to Master Lessee within thirty days after receipt of the Default Notice to exercise prompt reasonably diligent efforts to cure or cause to be cured by a receiver such breach or default within the period permitted by this paragraph, Lender's cure period shall continue for such additional time (the "Extended Cure Period") as Lender may reasonably require to either (a) obtain possession and control of the Property and thereafter cure the breach or default with reasonable diligence and continuity or (b) obtain the appointment of a receiver and give such receiver a reasonable period of time in which to cure the default. (b) (i) The Lender and Owner each agrees, simultaneously with the giving of any notice with respect to the Mortgage Loan, to give a duplicate copy thereof to the Investor. Should Owner default in respect of any of the provisions of the Mortgage Loan, the Master Lessee or the Investor shall have the right, but not the obligation, to cure such default, and the Lender thereof shall accept performance by or on behalf of the Master Lessee or the Investor as though, and with the same effect as if, it had been done or performed by Owner. The Master Lessee or the Investor will have a period of time after the service of such notice upon it within which to cure the default specified in such notice, or cause it to be cured, which is the same period for cure, if any, as is given under the Mortgage in respect of the specified default after the giving of any required notice thereunder. (ii) The Lender agrees that the removal of the managing member of the Master Lessee by the Investor pursuant to the Limited Partnership Agreement shall not in and of itself accelerate the Mortgage Loan or constitute a default under the Mortgage, provided that the Lender receives notice of such substitution within ten (10) days thereof. Form /01 Page A-5 J I Fannie Mae

6 7. Exculpation of Successor Landlord. Notwithstanding anything to the contrary in this Agreement or the Master Lease, upon any attornment pursuant to this Agreement the Master Lease shall be deemed to have been automatically amended to provide that Transferee's obligations and liability under the Master Lease shall never extend beyond Transferee's (or its successors' or assigns') interest, ifany, in the Property from time to time, including insurance and condemnation proceeds, Transferee's interest in the Master Lease, and the proceeds from any sale or other disposition of Property by Transferee (collectively, " Transferee's Interest"). Master Lessee shall look exclusively to Transferee's Interest (or that of its successors and assigns) for payment or discharge of any obligations of Transferee under the Master Lease as affected by this Agreement. If Master Lessee obtains any money judgment against Transferee with respect to the Master Lease or the relationship between Transferee and Master Lessee, then Master Lessee shall look solely to Transferee's Interest (or that of its successors and assigns) to collect such judgment. Master Lessee shall not collect or attempt to collect any such judgment out ofany other assets oftransferee. This provision shall be applicable to the Lender, its successor's or assigns, or its nominee only and shall not be applicable to any third party purchasing the premises from the Lender. 8. Miscellaneous. (a) This Agreement shall inure to the benefit of the parties hereto, their successors and assigns; provided, however, that in the event of the assignment or transfer of the interest of a Transferee, all obligations and liabilities of such Transferee under this Agreement shall terminate, and thereupon all such obligations and liabilities shall be the responsibility of the party to whom the Transferee's interest is assigned or transferred; and provided further that the interest of the Master Lessee under this Agreement may not be assigned or transferred except to the extent the assignment of the Master Lessee's interest in the Master Lease is permitted under the Master Lease. (b) Anything herein or In the Master Lease to the contrary notwithstanding, a Transferee shall have no obligation, nor incur any liability, beyond such Transferee's then interest in the Property, and the Master Lessee shall look exclusively to such interest of the Transferee in the Property for the payment and discharge of any obligations imposed upon the Transferee hereunder or under the Master Lease, or otherwise, subject to the limitation of the Transferee's obligations provided for in Section 4 above. (c) Anything herein or in the Master Lease to the contrary notwithstanding, in the event that the Investor or any Affiliate of the Investor shall Form Page A-6

7 acquire any interest in Owner, such party shall have no obligation, nor incur any liability, beyond its then interest in the Property, and, with respect to the Investor or any Affiliate, the Lender shall look exclusively to such interest of such 'party in the Property for the payment and discharge of any obligations imposed upon Owner hereunder or under the Mortgage, or otherwise. (d) This Agreement is the whole and only agreement between the parties hereto with regard to the subordination of the Master Lease to the lien or charge of the Mortgage, and shall supersede and cancel all other subjection or subordination agreements, including, but not limited to, those provisions, if any, contained in the Master Lease which provide for the subjection or subordination of said Master Lease to a deed of trust or to a mortgage or mortgages. This Agreement may not be modified in any manner or terminated except by an instrument in writing executed by the parties hereto. (e) This Agreement shall be deemed to have been made in the state where the Property is located and the validity, interpretation and enforcement of this Agreement shall be determined in accordance with the laws ofsuch state. (D In the event any legal action or proceeding is commenced to interpret or enforce the terms of, or obligations arising out of, this Agreement, or to recover damages for the breach thereof, the party prevailing in any such action or proceeding shall be entitled to recover from the non prevailing party all reasonable attorneys' fees, costs and expenses incurred by the prevailing party. (g) The Master Lease may not be modified or amended so as to reduce the Master Lease Payment or shorten the Term provided thereunder or so as to adversely affect in any other respect to any material extent the rights of any Lender, nor shall the Master Lease be canceled or surrendered, without the prior written consent, in each instance, of any Lender. (h) Except as expressly provided for in this Agreement, Lender shall have no obligations to Master Lessee with respect to the Master Lease. If an attornment occurs pursuant to this Agreement, then all rights and obligations of Lender under this Agreement shall terminate, without thereby affecting in any way the rights and obligations oftransferee provided for in this Agreement. (i) Any notices required hereunder will be in writing and will be either given by U.S. registered or certified mail, return receipt requested, with postage prepaid (except in the event of a postal disruption, by strike or otherwise, in the United States), or sent by telex or facsimile promptly confirmed in writing, or sent by personal delivery by a nationally recognized courier service for next day delivery. Form PageA-7 ) Fannie Mae

8 The current addresses and telecopy numbers of the parties to which any notice provided for herein shall be sent, are as follows: If to Owner: 400 Walnut Associates 1700 Walnut Street Philadelphia, PA Attention: John Turchi, Jr. Facsimile: (215) With a copy to: Wolf, Block, Schorr and Solis Cohen LLP 1650 Arch Street, 22 nd Floor Philadelphia, PA Attention: Michael Puleo, Esq. Facsimile: (215) Ifto Master Lessee: 400 Walnut Greentree Associates, LP 1700 Walnut Street Philadelphia, PA Attention: John Turchi, Jr. Facsimile: (215) With a copy to: Wolf, Block, Schorr and Solis-Cohen LLP 1650 Arch Street, 22 nd Floor Philadelphia, PA Attention: Michael Puleo, Esq. Facsimile: (215) If to the Lender: Independence Community Bank 195 Montague Street Brooklyn, NY Attention: Gary Honstedt, ExecutiveVice President Facsimile: (718) Form Page A-8

9 With a copy to: Cullen and Dykman Bleakley Platt LLP 44 Wall Street, 17 th Floor New York, NY Attention: Daniel M. Bagatta, Esq. Facsimile: (212) In each case, with copies to: Chevron TCI, Inc. 345 California Street, 30 th Floor San Francisco, CA Attention: John H. Medinger, Vice President Facsimile: (415) and Holland & Knight LLP 10 St. James Avenue Boston, MA Attention: Harry S. Dannenberg, Esq. Facsimile: (617) Any party may designate another addressee (and/or change its address or telecopy number) for notices hereunder by a notice given pursuant to this Section 7(h). Notices delivered personally or by facsimile will be effective upon delivery to an authorized representative of the party at the designated address; notices sent by mail in accordance with the above paragraph will be effective upon execution by the addressee of the return receipt requested. This Agreement may be executed in several counterparts and all so executed shall constitute one agreement binding on all parties hereto, notwithstanding that all the parties have not signed the original or the same counterpart. Any counterpart hereof signed by a party against whom enforcement of this Agreement is sought shall be admissible into evidence as an original hereof to prove the contents hereof. [SIGNATURE PAGE FOLLOWS] Form Page A-9

10 IN WITNESS WHEREOF, the parties have hereunto set their signatures and seals to this Subordination, Non-Disturbance and Attornment Agreement as of the date first above written. WITNESSIATTEST: OWNER: 400 WALNUT ASSOCIATES, a Pennsylvania limited partnership, by 400 Walnut Corporation, its General Partner By: _ John J. Turchi, Jr., President MASTER LESSEE: 400 WALNUT GREENTREE ASSOCIATES, LP, a Pennsylvania limited partnership, by 400 Walnut Corporation, its General Partner By: _ John J. Turchi, Jr., President LENDER: INDEPENDENCE COMMUNITY BANK By: ---, =-----:~----=-::: -=-----:- Gloria M. Clarke, First Vice President INVESTOR: CHEVRON TCI, INC., a California corporation By: FANNIE MAE MULTIFAMILY SECURlTY INSTRUME Form /01 PageA-10

11 ,~ IN WITNESS WHEREOF, the parties have hereunto set their signatures and seals to this Subordination, Non-Disturbance and Attornment Agreement as of the date first above written. WITNESS/ATTEST: OWNER: 400 WALNUT ASSOCIATES, a Pennsylvania limited partnership, by 400 Walnut.. eral Partner MASTER LESSEE: 400 WALNUT GREENTREE ASSOCIATES, LP, a Pennsylvania limited partnership, by 400 W o eneral Partner LENDER:' NDENCE COMMUNITY BANK loria M. Clarke, First Vice President CHEVRON TCI, INC., a California corporation By: John H. Medinger, Vice President Form /01 Page A-fO

12 ,~ STATE OF NEW YORK ) ss. COUNTY OF NEW YORK ) On the 20 th day of February, 2004 before me, the undersigned, personally appeared John J. Turchi, Jr., personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the per n upon behalfof which the individual acted, executed the instrument. STATE OF NEW YORK COUNTY OF NEW YORK ) ss. ) Notary PuB ic RAH M. VOYTOVICH tan N PubUo State of New York o_~ Q2V Jt 0 8d In Suffolk CountY. com~8slon expires June 11, 2007 On the 20 th day of February, 2004 before me, the undersigned, personally appeared John J. Turchi, Jr., personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the pe son up n behalfof which the individual acted, executed the instrument. STATE OF NEW YORK COUNTY OF KINGS ) ss. ) Notary Public VOYTOVICH o BO bile Stale of New York Not N~ 02\ Quallfled in ~uffo'k co~~ty2001 comm\ssion ExpIres June. -' On the 20 th day of February, 2004 before me, the undersigned, personally appeared Gloria M. Clarke, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person upon behalf of which the inn1vidual actedtexecuted the' trument. -na N IEL M. SAGAT A Notary Public, State Of New York No. 02BA Qualified In Nassau County / Commission Expires 8/27/20 0., - Form /01 Page A-II

13 , STATE OF CALIFORNIA COUNTY OF SAN FRANCISCO ) ) ss.: ) On February 20, 2004, before me, Charles Hall Jr., Notary Public, personally appeared John H. Medinger, personally known to me to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument, the person or the entity on behalf of which the person acted, executed the instrument. 1(16 th;~h:u.. Jt 6 6 J _ Commission # 12.B2554 ~. Notay PubflC - Colifania ~ j SOn Fmnclsco County f /oitfccmm. E;cpres Oct31,:<r04 u u WITNESS my hand and official seal. ~~'--- Commission expires: l'l.--'\. 31 I Jaif FANNIE MAE MULTIFAMILY SECURITY INSTRUMENT Form /01 Page A-12

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15 EXHIBIT A DESCRIPTION OF THE LAND ALL that certain lot or piece of ground with the buildings and improvements erected thereon, situate in the Fifth Ward of the City of Philadelphia and described in accordance with a survey and plan prepared by Barton and Martin Engineers, dated May 18, 2001, and revised May 30, 2001, as follows, to wit: BEGINNING at the point of intersection of the Southerly side of Walnut Street (50 feet wide) and the Westerly side of Fourth Street (50 feet wide); thence extending Southwardly, along the said Westerly side of Fourth Street, the distance of 62 feet 6-1/2 inches to a point; thence extending Westwardly, parallel with said Walnut Street, the distance of77 feet to a point; thence extending Southwardly, parallel with said Fourth Street, the distance of20 feet 11-1/2 inches to a point, thence extending Westwardly, parallel with said Walnut Street, the distance of 59 feet 7 inches to a point; thence extending Northwardly, parallel with said Fourth Street, the distance of 83 feet 6 inches to a point on the said Southerly side of Walnut Street; thence extending Eastwardly, along the said Southerly side of Walnut Street; thence extending Eastwardly, along the said Southerly side of Walnut Street, the distance of 136 feet 7 inches to the first mentioned point and place of BEGINNING. Being known as Nos Walnut Street. Being inter alia same premises which GGU Insurance Company (fonnerly General Accident Insurance Company of America), a Pennsylvania Corporation by Deed dated May 12, 2000 and recorded June 26, 2000 in Philadelphia County as Document No conveyed unto 400 Walnut Associates, a Pennsylvania Limited Partnership, in fee. TOGETHER with all right, title and interest of the mortgagor in and to the land lying in the streets and roads in front of and adjoining said premises (consisting of both Parcel A and Parcel B) to the center line thereof. SAID PREMISES being known as Walnut Street, Philadelphia, Pennsylvania Form /01 Page A-13