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HomeMy WebLinkAboutTri-Party Agreement/Village Financial; Mercantile Bank; CRC - PAC Equipment - $7,515,800TRI -PARTY AGREEMENT PAC Equipment This Tri -Party Agreement (PAC Equipment) (the "Agreement ") is executed as of the J� day of August, 2009, by and among Mercantile Bank, having its principal office at 12821 East New Market Street, Suite 301, Carmel, Indiana 46032 (the "Lender"), Village Financial, LLC, having its principal office at 770 3`° Avenue Southwest, Carmel, Indiana 46032 (the "Borrower ") and The City of Carmel Redevelopment Commission, having its principal office at City of Carmel, Indiana, One Civic Square, Carmel, Indiana 46032 ( "CRC "). 1. Definitions. Acceleration Exercise Notice shall mean a written notice pursuant to which Lender notifies CRC that Lender is exercising the Acceleration Option. Acceleration Option shall mean the option (but not the obligation) of Lender to accelerate the Contract Payments; provided that, the amount that CRC shall be obligated to pay in connection with such an acceleration shall be the Base Acceleration Payment, except as provided to the contrary in Subsection 4(c). Acceleration Payment shall mean the Base Acceleration Payment or the Adjusted Acceleration Payment, as applicable. Accrued Interest shall mean the Base Rate Accrued Interest or the Adjusted Rate Accrued Interest, as applicable. Adjusted Acceleration Payment shall mean the sum of: (a) the Adjusted Rate Accrued Interest; and (b) the Adjusted Outstanding Principal Balance; provided that, for purposes of this definition, all references to "Loan Purchase Date" in the definitions of Adjusted Rate Accrued Interest and Adjusted Outstanding Principal Balance shall be deemed to be references to the Equipment Closing Date. Adjusted Outstanding Principal Balance shall mean the amount, on the Loan Purchase Date, of the principal balance of advances of proceeds of the Loan through the Loan Purchase Date that: (a) have been made to pay Aggregate Equipment Costs; and (b) remain outstanding; which amount shall include all Lender Fees (including all Lender Fees that are owed by Borrower as a result of a Loan Default); provided that the Adjusted Outstanding Principal Balance shall be reduced by any Prepayments that have been remitted to Lender, even if Lender has not yet applied any such Prepayments as required pursuant to Section 8. In no event shall the Adjusted Outstanding Principal Balance exceed $7,515,800.00, plus Lender Fees (including all Lender Fees that are owed by Borrower as a result of a Loan Default). Adjusted Purchase Price shall mean the sum of: (a) the Adjusted Rate Accrued Interest; and (b) the Adjusted Outstanding Principal Balance. Adjusted Rate Accrued Interest shall mean all interest on the Adjusted Outstanding Principal Balance that has accrued, and remains unpaid, as of the Loan Purchase Date, regardless of whether such interest has accrued at the Loan Rate or the Default Rate. Aggregate Equipment Costs shall mean the sum of the Equipment Costs and the Lender Fees. Base Acceleration Payment shall mean the sum of: (a) the Base Rate Accrued Interest: and (b) the Base Outstanding Principal Balance; provided that, for purposes of this definition, all references to "Loan Purchase Date" in the definitions of Base Rate Accrued Interest and Base Outstanding Principal Balance shall be deemed to be references to the Equipment Closing Date. The Base Acceleration Payment corresponds to the "Full Prepayment Price" under the Installment Contract. Base Outstanding Principal Balance shall mean the amount, on the Loan Purchase Date, of the principal balance of advances of proceeds of the Loan through the Loan Purchase Date that: (a) have been made to pay Aggregate Equipment Costs; and (b) remain outstanding; which amount shall include all Lender Fees, to the extent that such Lender Fees have been incurred in the absence of a Loan Default; provided that such amount specifically shall exclude all Lender Fees that are owed by Borrower as a result of a Loan Default. The Base Outstanding Principal Balance shall be reduced by any Prepayments that have been remitted to Lender, even if Lender has not yet applied any such Prepayments as required pursuant to Section 8. In no event shall the Base Outstanding Principal Balance exceed $7,515,800.00, plus Lender Fees, to the extent that such Lender Fees have been incurred in the absence of a Loan Default. Base Purchase Price shall mean the sum of: (a) the Base Rate Accrued Interest; and (b) the Base Outstanding Principal Balance. Base Rate Accrued Interest shall mean all interest on the Base Outstanding Principal Balance that has accrued at the Loan Rate, and remains unpaid, as of the Loan Purchase Date. Borrower Contract Default shall mean any "Event of Default" by Borrower under the Installment Contract, regardless of whether such Event of Default results in a Loan Default. Borrower Loan Default shall mean a Loan Default caused by: (a) the failure by Borrower to observe or perform any obligation under the Loan Documents; or (b) any "Event of Default" by Borrower under the Installment Contract. Collateral Assignment shall mean that certain Collateral Assignment, Lock Box, and Security Agreement (PAC Equipment) of even date herewith executed by and among Borrower, Lender, and CRC. Contract Default Notice shall mean a copy of any notice of default delivered to Borrower pursuant to the Installment Contract. Contract Payments shall mean all payments to be made by CRC pursuant to the Installment Contract. CRC Monetary Default shall mean an "Event of Default" by CRC under the Installment Contract that results from the failure of CRC to make any payment when due thereunder, which "Event of Default" causes a Loan Default. CRC Non - Monetary Default shall mean an "Event of Default" by CRC under the Installment Contract or the Master Loan Program Agreement that results from the failure of CRC to observe or perform any obligation to be observed or performed by it thereunder (other than the failure to make any payment when due), which "Event of Default ", in the case of an "Event of Default" under the Installment Contract, causes a Loan Default. Cure Notice shall mean a written notice pursuant to which CRC notifies Lender that CRC has elected to cure a default by Borrower that, upon the expiration of applicable cure periods, would constitute a Borrower Loan Default. Default Rate shall have the meaning set forth in the Loan Agreement. Equipment shall mean an estimated $7,515,800.00 of equipment for use in the operation of the PAC (including, without limitation, orchestra risers), which equipment shall be acquired by Borrower pursuant to the Installment Contract. The Equipment is the "Equipment" under the Installment Contract. Equipment Closing shall mean the closing with respect to the transfer of the Equipment. Z. \Documents \•Shoup, Jenny City orCarmel`Parcel 7\PAC Equipment- Mercantile''Tri Party Agreement \Tri Party Agreement -PAC Equipment.Mercanti le. v2a. wpd IIAugo9 Equipment Closing Date shall mean the date on which the Equipment Closing occurs. Equipment Costs shall mean the actual, out -of- pocket costs incurred by Borrower to acquire the Equipment in accordance with the terms and conditions of the Installment Contract. Full Prepayment shall mean payment in full by CRC of the "Full Prepayment Price" under the Installment Contract as a result of the exercise by CRC of the "Full Prepayment Option" (as defined in the Installment Contract). Installment Contract shall mean that certain PAC Equipment Installment Purchase Contract of even date herewith executed by and between Borrower and CRC, a copy of which is attached hereto as Exhibit A. Laws shall mean all applicable federal, state, or local laws, statutes, ordinances, rules, or regulations, or any orders or decrees of any court, agency, or regulatory body. Lender Cure Period shall mean the period that commences upon the default by Borrower under the Installment Contract and expires on the date that is 45 days after the later of: (a) the expiration of the applicable cure period under the Installment Contract; or (b) receipt by Lender of the Contract Default Notice. Lender Fees shall mean regular (non - default) lender fees, costs, and expenses due and payable by Borrower to Lender under the Loan Documents, including, without limitation, costs and expenses: (a) to close the Loan; and (b) that, under the terms and conditions of the Collateral Assignment or the Loan Agreement, expressly constitute Lender Fees. Loan shall mean a loan from Lender to Borrower made to finance the payment of Aggregate Equipment Costs, which loan shall be in the original principal amount of $7,515,800.00. Loan Agreement shall mean that certain Loan Agreement (PAC Equipment) of even date herewith executed by and between Lender and Borrower. Loan Default shall mean an "Event of Default" under any of the Loan Documents or the Master Loan Program Agreement; provided that, if "Event of Default" is not a defined term in any Loan Document, then, with respect to such Loan Document, there shall be a Loan Default if Borrower is in default thereunder beyond any applicable notice or cure periods. Loan Default Notice shall mean a written notice pursuant to which Lender notifies CRC that a Loan Default exists. Loan Documents shall mean the documents evidencing and /or securing the Loan, including, specifically, the Loan Agreement, the Note, and the Collateral Assignment. Loan Interests shall mean: (a) the Loan; (b) the Loan Documents; (c) the collateral assignments and security interests granted in the Collateral Assignment (including the collateral assignment of, and security interest in, the Installment Contract); and (d) all rights and interests of Lender with respect to the Loan and under the Loan Documents, including, specifically, the right to: (i) enforce the terms and conditions of the Loan Documents; (ii) collect the Accrued Interest and the Outstanding Principal Balance; (iii) enforce the Installment Contract in accordance with the terms and conditions of the Collateral Assignment; and (iv) exercise all rights and remedies afforded by the Laws to secured lenders with respect to security interests in assigned installment contracts. Loan Interests Closing shall mean the closing with respect to the purchase by CRC of the Loan Interests. Z.'Documents Shoup. Jenny. Cite of Carmel \Parcel 7\PAC Equipment - Mercantile \Tri Partv Agreement \Tri Party Agreement -PAC Equipment . Mercanti le. v2a. wpd IIAu_09 Loan Purchase Date shall mean the date on which the Loan Interests Closing occurs. Loan Purchase Price shall mean the Base Purchase Price or the Adjusted Purchase Price, as applicable. Loan Rate shall mean the regular (non - default) rate of interest accruing on the Outstanding Principal Balance pursuant to the Loan Documents. Master Loan Program Agreement shall mean that certain Master Loan Program Agreement of even date herewith executed by and between CRC and Lender. Maturity Date shall mean the date on which the Outstanding Principal Balance is scheduled to become due in full pursuant to the Note, as such date may be extended pursuant to the terms and conditions of the Loan Agreement and /or the Note. Note shall mean that certain Promissory Note (PAC Equipment) of even date herewith executed by Borrower in favor of Lender and evidencing the Loan. Outside Closing Date shall mean, with respect to the Loan Interests Closing, the date that is: (a) in the case of the exercise by CRC of the Purchase Option, 30 days after CRC delivers the Purchase Exercise Notice; or (b) in the case of the exercise by Lender of the Put Option, 15 days after Lender delivers the Put Exercise Notice; provided that, in the case of an exercise of the Put Option as a result of a Borrower Loan Default, the Outside Closing Date shall mean the date that is 15 days after the expiration of the Standstill Period. Outstanding Principal Balance shall mean the Base Outstanding Principal Balance or the Adjusted Outstanding Principal Balance, as applicable. PAC shall have the meaning set forth in the Loan Agreement and the Installment Contract. Partial Prepayment shall mean payment by CRC of a "Partial Prepayment" under the Installment Contract. Prepayment shall mean a Partial Prepayment or the Full Prepayment, as applicable. Purchase Exercise Notice shall mean a written notice pursuant to which CRC notifies Lender that CRC is exercising the Purchase Option. Purchase Option shall mean the option (but not the obligation) of CRC to require Lender to convey the Loan Interests to CRC for: (a) the Base Purchase Price, in the case of a Borrower Loan Default or a Borrower Contract Default, except to the extent that Subsection 3(d) is applicable; or (b) the Adjusted Purchase Price, in the case of a CRC Monetary Default or a CRC Non - Monetary Default. Put Exercise Notice shall mean a written notice pursuant to which Lender notifies CRC that Lender is exercising the Put Option. Put Option shall mean the option (but not the obligation) of Lender to require CRC to purchase the Loan Interests from Lender for the Base Purchase Price, except to the extent that Subsection 3(d) is applicable. Standstill Period shall mean the period: (a) commencing upon delivery of a Loan Default Notice; and (b) ending on the last to occur of the date: (i) that is 30 days after delivery of the Loan Default Notice to CRC; or (ii) of the expiration of the cure period provided to CRC in Section 6. Notwithstanding the foregoing, if either: (a) CRC has exercised the Purchase Option; or (b) Lender has exercised the Put Option; then the Standstill Period shall end on the first to occur of the date: (a) determined pursuant to clause (b) of the prior sentence; or (b) on which the Loan Interests Closing occurs; provided that, if, due to a failure of Lender, the "!_:'Documents \Shoup, Jennv`.0 ity of CarmelParcel 7\PAC Equipment-Mercantile \; I'ri Party Agreement',Tri Party Agreement -PAC Equipment. Mercantile.v2a.wpd -4- 1 I A u, U') Loan Interests Closing does not occur on or before the Outside Closing Date, then the Standstill Period shall be extended until the Loan Interests Closing occurs. 2. Purchase. (a) General. (i) If there is a Borrower Contract Default or a Loan Default, regardless of whether such Loan Default results from a CRC Monetary Default, a CRC Non - Monetary Default, or a Borrower Loan Default, then the Purchase Option shall apply. As provided in the definition of Purchase Option, in the case of: (A) a Borrower Loan Default or a Borrower Contract Default, the Base Purchase Price shall apply, except in the event that Subsection 3(d) is applicable; and (B) a CRC Monetary Default, a CRC Non - Monetary Default, or Subsection 3(d) being applicable; the Adjusted Purchase Price shall apply. (ii) if there is a Loan Default, regardless of whether such Loan Default results from a CRC Monetary Default, a CRC Non - Monetary Default, or a Borrower Loan Default, then the Put Option shall apply. As provided in the definition of Put Option, the Base Purchase Price shall apply, except in the event that Subsection 3(d) is applicable. (iii) If there is a CRC Monetary Default or a CRC Non - Monetary Default, then the Acceleration Option shall apply. As provided in the definition of Acceleration Option, the Base Acceleration Payment shall apply, except as provided to the contrary in Subsection 4(c). (b) Exercise - Borrower Contract Default. If there is a Borrower Contract Default, then CRC may exercise the Purchase Option by delivering a Purchase Exercise Notice to Lender. Lender shall have no right to exercise the Put Option or the Acceleration Option in the event of a Borrower Contract Default. (c) Exercise -Loan Default. (i) Lender shall deliver a Loan Default Notice to CRC concurrently with any notice provided to Borrower with respect to the Loan Default; provided that, if Lender: (A) is not obligated to (or otherwise does not) provide any such notice to Borrower; and (B) intends to exercise any of its remedies with respect to such Loan Default; then Lender shall deliver a Loan Default Notice to CRC prior to exercising any such remedies. (ii) At any time after CRC receives a Loan Default Notice, CRC may exercise the Purchase Option by delivering a Purchase Exercise Notice to Lender. (iii) If Lender delivers to CRC a Loan Default Notice, the subject of which is a Borrower Loan Default not resulting from a CRC Monetary Default or a CRC Non - Monetary Default, then, at any time after delivery of such Loan Default Notice to CRC, Lender may exercise the Put Option by delivering a Put Exercise Notice to CRC; provided that, notwithstanding any other term or condition of this Agreement, if, prior to the last to occur of the date: (A) that is 30 days after delivery of the Loan Default Notice to CRC; or Z: \Documents'Shoup, Jennv`.City orCarmef,Parcel 7:.PAC Equipment- Mercantile \Tri Party Agreement\Tri Party Agreement -PAC Equipment. Mercanti le. v2a. typd -5- IIAugO9 (B) of the expiration of the Standstill Period; the underlying Loan Default is cured, then: (A) the exercise by Lender of the Put Option shall be deemed to be rescinded and of no further force or effect; and (B) neither the Outside Closing Date nor any of the terms or conditions of Section 3 shall apply . (iv) If Lender delivers to CRC a Loan Default Notice, the subject of which is a CRC Monetary Default or a CRC Non - Monetary Default, then, at any time after delivery of such Loan Default Notice, Lender may exercise the Acceleration Option by delivering an Acceleration Exercise Notice to CRC; provided that, notwithstanding any other term or condition of this Agreement, if, prior to the date that is: (A) ten days after delivery of the Loan Default Notice, in the case of the first two CRC Monetary Defaults in any given 12 month period; (B) ten days after the occurrence of the CRC Monetary Default, in the case of the third or any subsequent CRC Monetary Default in any given 12 month period; or (C) in the case of a CRC Non - Monetary Default, the last to occur of the date that is: (1) 30 days after delivery of the Loan Default Notice to CRC; or (2) the expiration of the cure period provided to CRC in Section 6; the CRC Monetary Default or the CRC Non - Monetary Default, as applicable, is cured, then: (A) the exercise by Lender of the Acceleration Option shall be deemed to be rescinded and of no further force or effect; and (B) neither the Outside Closing Date nor any other term or condition of Section 4 shall apply. (v) Notwithstanding anything to the contrary set forth herein or in the Loan Documents, if, prior to the expiration of the Standstill Period, either: (A) CRC delivers a Purchase Exercise Notice to Lender; or (B) Lender delivers a Put Exercise Notice to CRC; then Lender shall not exercise any of its remedies or apply the Default Rate with respect to such Loan Default, unless, due to a failure of CRC, the Loan Interests Closing has not occurred as of the Outside Closing Date. 3. Loan Purchase Closing. (a) CRC Exercise. If CRC exercises the Purchase Option, then the Loan Interests Closing shall occur on or before the date that is 30 days after CRC delivers to Lender the Purchase Exercise Notice. (b) Lender Exercise. If Lender exercises the Put Option, then the Loan Interests Closing shall occur on or before the date that is 15 days after Lender delivers the Put Exercise Notice to CRC; provided that, in the case of an exercise of the Put Option as a result of a Borrower Loan Default not resulting from a CRC Monetary Default or a CRC Non - Monetary Default, the Loan Interests Closing shall not occur until the date that is 15 days after the expiration of the Standstill Period. (c) Closing Deliveries. At the Loan Interests Closing: (i) CRC shall pay the Loan Purchase Price to Lender; and (ii) Lender shall assign the Loan Interests to CRC pursuant to assignment documents that: (A) are adequate to vest the Loan Interests in CRC free and clear of the rights or interests of any other party; (B) contain certifications by Lender to the effect that Lender: (1) is not in default under this Agreement (including, without limitation, that Lender is in compliance with the terms and conditions of Section 5); and (2) is not aware of any defenses or offsets of Borrower to: (aa) enforcement by CRC, as assignee of Lender, of the Loan Documents; (bb) collection by CRC, as assignee of Lender, of any amounts due from Borrower under the Loan Documents; and /or (cc) exercise by CRC, as assignee of Z' Documents`Shoup, Jenny \Cite of Carmel \Parcel 7 \PAC Equipment- Mercantile'Tri Party Agreement \Tri Party Agreement -PAC Equipment.Mercantile.v2a.wpd -6- I Au 09 Lender, of the rights and remedies afforded by the Laws to secured lenders with respect to security interests in assigned installment contracts; and (C) otherwise reasonably are acceptable to CRC. (d) Delinquency. Notwithstanding anything to the contrary set forth herein, if: (i) the applicable Loan Purchase Price is the Base Purchase Price; and (ii) due to a failure of CRC, the Loan Interests Closing does not occur on or before the Outside Closing Date; then the applicable Loan Purchase Price automatically shall become the Adjusted Purchase Price. 4. Equipment Closing. (a) Closing. If Lender exercises the Acceleration Option, then, notwithstanding anything to the contrary set forth in the Installment Contract, the Equipment Closing shall occur on or before the date that is 15 days after Lender delivers the Acceleration Exercise Notice. (b) Closing Deliveries. At the Equipment Closing: (i) CRC shall pay the Acceleration Payment to Lender; and (ii) Borrower shall deliver to CRC a fully executed bill of sale with full warranties of title transferring the Equipment to CRC free of all liens, security interests, and equipment leaseholds, which bill of sale shall be in the form attached to the Installment Contract as Exhibit G. (c) Delinquency. Notwithstanding anything to the contrary set forth herein, if, due to a failure of CRC, the Equipment Closing has not occurred within 15 days after Lender delivers the Acceleration Exercise Notice to CRC, then, in lieu of the Base Acceleration Payment, CRC shall be obligated to pay the Adjusted Acceleration Payment. 5. Prohibitions. In each case, subject to the terms and conditions of this Agreement: (a) In the case of a Borrower Loan Default, Lender shall not accelerate the Maturity Date or the payment of all or any portion of the Outstanding Principal Balance, unless and until Lender has complied with the terms and conditions of Section 6 and either: (i) CRC does not elect to cure the applicable default by Borrower within the time permitted pursuant to Section 6; or (ii) CRC: (A) timely elects to cure such default by Borrower; but (B) does not complete the foregoing within the time permitted pursuant to Section 6. (b) Lender shall not: (i) require payments by Borrower of all or any portion of the Outstanding Principal Balance, except: (A) in accordance with the terms and conditions of the Note with respect to regular payments of principal and interest; (B) in the case of a CRC Monetary Default or a CRC Non- Monetary Default; (C) when Lender would be entitled under Subsection 5(a) to accelerate the Maturity Date; or (D) on the Maturity Date; or (ii) condition acceptance of a Prepayment upon receipt of a prepayment premium or penalty, except in accordance with the terms and conditions of the Loan Documents. (c) Lender shall not modify, amend, or revise any of the Loan Documents to: (i) increase the default rate of interest to an amount that exceeds the Loan Rate plus 4 %; (ii) increase the Loan Rate; (iii) change the terms with respect to payment or prepayment of the Outstanding Principal Balance; (iv) increase or materially change Borrower's obligations under the Loan Documents; or (v) decrease or materially change Borrower's rights under the Loan Documents; provided that, notwithstanding the foregoing, the parties agree that Lender may modify, amend, or revise any of the Loan Documents to the extent necessary to bring the Loan Documents into compliance with the Laws. 7_:',Documents \Shoup, Jenny \City of Carmel Parcel 7 PAC Equipment- Mercantile\Tri Pam' Agreement \Tri Party Ageement -PAC Equi pment. Mercanti le. v2a. wpd -7- 1 I A u tt09 (d) Lender shall not advance Loan proceeds in excess of: (i) $7,515,800.00; plus (ii) the amount of the Lender Fees; provided that, if the Loan Purchase Price has become the Adjusted Loan Purchase Price as provided in Subsection 3(d), then Lender may advance additional Loan proceeds in accordance with the terms and conditions of the Loan Documents. Notwithstanding anything to the contrary set forth herein, when Lender Fees become due, Lender shall notify CRC and CRC shall have the option either to: (i) pay the amount of such Lender Fees directly to Lender (in which case such amount shall not become part of the Outstanding Principal Balance); or (ii) authorize Lender to disburse to itself the amount of such Lender Fees. (e) Lender shall not waive, release, delete, or compromise the terms or conditions of Subsections 9(a), 9(c), 10(g), 10(h), 10(i), 10 (j), 10(1), and /or 10(m) of the Loan Agreement (or any of the corresponding Subsections in any other Loan Document) or waive or release an Event of Default under any of the foregoing Subsections (or any of the corresponding Subsections in any other Loan Document). (f) Lender shall not waive, release, delete, or compromise the obligations of Borrower to pay the Accrued Interest or the Outstanding Principal Balance, except: (i) in compliance with the terms and conditions of this Agreement; or (ii) if the Loan Purchase Price and the Acceleration Payment are reduced commensurately. (g) Lender shall not consent to Borrower directly or indirectly selling, transferring, assigning, conveying, pledging, or otherwise delegating or disposing of its interests in or to, its rights to or under, or its obligations under or for, the Loan or the Loan Documents. (h) Lender shall not modify, amend, or revise any of the Loan Documents (or waive, release, delete, or compromise the rights and remedies of Lender thereunder) so that, if the Loan Interests were assigned to CRC, the Loan Documents would not provide to CRC, as assignee, the right to: (i) collect the Accrued Interest and the Outstanding Principal Balance; and (ii) exercise all rights and remedies afforded by the Laws to secured lenders with respect to security interests in assigned installment contracts. (i) Lender shall not modify, amend, or revise any of the Loan Documents to: (i) expand or enlarge the categories or types of costs, expenses, fees, or charges that may be incurred by Lender or charged to Borrower; or (ii) otherwise add to or supplement such costs, expenses, fees, or charges. (j) Lender shall not directly or indirectly sell, transfer, assign, convey, pledge, or otherwise delegate or dispose of its interests in or to, or its rights to or under, any of the Loan Interests, except subject to the terms and conditions of this Agreement and the rights of CRC hereunder. 6. CRC Cure Right. (a) Notices. Lender shall provide to CRC copies of all notices of defaults delivered to Borrower pursuant to the Loan Documents, which copies shall be delivered simultaneously with the notice delivered to Borrower; provided that, if no notice of default is required to be delivered to Borrower prior to a default becoming a Loan Default, then, prior to exercising any of its remedies under the Loan Documents or applying the Default Rate with respect to the default, Lender shall deliver written notice to CRC. (b) Default. If such notice is for a default that, upon the expiration of applicable cure periods, will constitute a Borrower Loan Default (which Borrower Loan Default does not result Z y Documents' Shoup, Jenny 'City of Carmel''Parcel 7yPAC Equipment- Mercantile'.Tri Party Agreement`,Tri Pam Agreement -PAC Equipment.Mercantile.t2a.wpd -8- 1I..ue09 from a CRC Monetary Default or a CRC Non - Monetary Default), then CRC shall have the option (but not the obligation) to cure such default; provided that, to exercise such option, CRC shall deliver a Cure Notice to Lender on or before the date that is 30 days after CRC receives notice from Lender of the existence of such default. If CRC timely elects to cure the default, then CRC shall effectuate the cure within 30 days after delivery of the Cure Notice; provided that, if such default is of a nature that it reasonably cannot be cured within 30 days, then, so long as CRC commences the cure within the 30 day period, the period for completing the cure shall be extended for as long as CRC diligently is pursuing such completion, which extension shall not exceed a period of 90 days. (c) Standstill. Notwithstanding anything to the contrary set forth in the Loan Documents, Lender shall not exercise any of its remedies under the Loan Documents or apply the Default Rate with respect to any default that, upon the expiration of applicable cure periods, will constitute a Borrower Loan Default (which Borrower Loan Default does not result from a CRC Monetary Default or a CRC Non - Monetary Default) until the expiration of the Standstill Period. If CRC cures a default by Borrower pursuant to this Section, then: (i) Lender shall accept such cure by CRC as a cure by Borrower; (ii) Lender shall not exercise any of its remedies under the Loan Documents with respect to the default, as cured or addressed by CRC; and (iii) Borrower, immediately upon receipt of written demand, shall reimburse CRC for all costs and expenses incurred by CRC in connection with effectuating such cure. 7. Consents and Protections. (a) Collateral Assignment. CRC: (i) consents to: (A) the collateral assignment of the Installment Contract to Lender; and (B) the grant of a security interest in the Equipment to Lender; as security for the Loan; (ii) agrees that: (A) the security interest of Lender in the Equipment is superior and prior to the rights of CRC with respect to the Equipment under the Installment Contract; and (B) the rights of CRC with respect to the Equipment under the Installment Contract are subordinate and subject to the security interest of Lender in the Equipment; (iii) agrees to execute such documents as Lender reasonably may require to effect or confirm: (A) such collateral assignment; (B) the security interest of Lender in the Installment Contract and the Equipment; and (C) the subordination and subjugation of the rights of CRC with respect to the Equipment under the Installment Contract to the security interest of Lender in the Equipment; and (iv) agrees that, pursuant to the Collateral Assignment, Lender shall have the right, as if Lender were in direct privity with CRC, to enforce the obligations of CRC under the Installment Contract until the first to occur of the date on which: (A) the Loan is repaid in full; (B) CRC purchases the Loan Interests; or (C) CRC pays the Acceleration Payment. (b) Installment Contract. (i) If there is a Borrower Contract Default, then CRC may exercise any remedies available to it under the Installment Contract; provided that, in no event shall CRC: (A) exercise any remedy of offset that otherwise may be available to it; or (B) terminate the Installment Contract; unless and until CRC pays either the Purchase Price or the Full Prepayment Price (as each is defined in the Installment Contract). (ii) Notwithstanding anything to the contrary set forth herein or in any Loan Documents: (A) a default by CRC or Borrower under the Installment Contract shall not constitute a Loan Default unless and until such default becomes an "Event of Default" by CRC or Borrower, respectively, under the Z:'Documenti Shoup, Jenny,Ci v ofCarmel',Parcel 7APAC Equipment - Mercantile Tri Party Agreement \Tri Party Agreement -PAC Equipment Mercantile.c2a.npd -9- 1IAug09 Installment Contract; and (B) undeclared Borrower Contract Defaults shall not constitute Loan Defaults. (c) Lender Protections. (1) CRC shall provide a Contract Default Notice to Lender simultaneously with any notice delivered to Borrower. (ii) If there is a default by Borrower under the Installment Contract, then: (A) Lender shall have the right to cure the Borrower default until the expiration of the Lender Cure Period; and (B) CRC shall accept a cure by Lender as a cure by Borrower. Notwithstanding the foregoing, no term or condition of this Agreement shall be deemed to: (A) require Lender to satisfy any obligation of Borrower under the Installment Contract, or cure any breach by Borrower of its obligations under the Installment Contract; or (B) otherwise make Lender liable for any such breach. (iii) Unless and until CRC pays either the Purchase Price or the Full Prepayment Price (as each is defined in the Installment Contract), no amendment, modification, supplement, surrender, cancellation, or termination of the Installment Contract shall be effective, unless Lender consents in writing to such amendment, modification, supplement, surrender, cancellation, or termination. Any attempted amendment, modification, supplement, surrender, cancellation, or termination of the Installment Contract without the consent of Lender shall be void and unenforceable, and shall have no force or effect. 8. Prepayments. If CRC makes a Prepayment, then: (a) Borrower shall pay the amount of such Prepayment to Lender for application against the Outstanding Principal Balance; and (b) Lender shall apply the amount of such Prepayment against the Outstanding Principal Balance. 9. Representations. (a) No Modification. Each of Borrower and CRC represents that: (i) the copy attached hereto as Exhibit A is a true, correct, and complete copy of the Installment Contract; and (ii) the Installment Contract: (A) is in full force and effect on the date hereof; and (B) has not been modified, amended, revised, supplemented, restated, or replaced in any respect. except as set forth on Exhibit B. (b) No Default. Each of Borrower and CRC represents that: (i) there are no Borrower Contract Defaults; (ii) there are no defaults by CRC under the Installment Contract; and (iii) to its knowledge, no event has occurred, and no condition exists, that, with the giving of notice or the lapse of time or both, will constitute: (A) a Borrower Contract Default; or (B) an "Event of Default" by CRC under the Installment Contract. (c) No Defense. Each of Borrower and CRC represents that: (i) the Installment Contract is enforceable in accordance with it terms; and (ii) it has no: (A) existing defenses, offsets. or credits against: (1) the enforcement of the Installment Contract by the other party; or (2) the payment of any amounts due under the Installment Contract; or (B) right exercisable at this time to cancel or terminate the Installment Contract. (d) No Bankruptcy. Each of Borrower and CRC represents that no actions, whether voluntary or otherwise, are pending against it (and no petition has been filed by or on behalf Z \Documents' Shoup, JennyVCity of CarmehParcel 7`PAC Equipment - Mercantile \Td Party Agreement \Tri Party Agreement -PAC Equipment. Mercanti le.v2a.wpd -10- 1 I Auu09 to it) or any of its general partners, members, or controlling shareholders under the bankruptcy or insolvency laws of the United States or any state thereof. 10. Assignment. No party shall assign this Agreement, or its rights or obligations hereunder, without the prior written consent of each of the other parties; provided that: (a) without the prior written consent of Borrower or Lender, CRC may assign this Agreement and the Installment Contract to another agency or instrumentality of the City of Carmel, Indiana, of equal or superior creditworthiness and financial capacity to perform the obligations of CRC hereunder, as established to the reasonable satisfaction of Lender; and (b) without the prior written consent of Borrower or CRC, Lender may assign this Agreement to any successor to which all of the Loan Interests are assigned, so long as the assignment is subject to the terms and conditions of this Agreement and the rights of CRC hereunder. Notwithstanding any assignment permitted under this Section: (a) each party shall remain liable to perform all of the terms and conditions to be performed by it under this Agreement; and (b) the consent of the other parties with respect to an assignment shall not release the assigning party from such performance. 11. Deliveries. Each party shall execute and deliver such additional documents and instruments as reasonably may be reasonably required by the other parties to accomplish the purposes of this Agreement. 12. Indemnity. Each of Lender, Borrower, and CRC shall indemnify and hold harmless the other parties from and against any and all claims, liabilities, losses, damages, costs, and expenses (including, without limitation, reasonable attorneys' fees) arising from, or in connection with the breach by Lender, Borrower, or CRC, respectively, of any term or condition of this Agreement. The foregoing indemnification obligation shall include the obligation of CRC to indemnify and hold harmless Borrower from and against any and all claims, liabilities, losses, damages, costs, and expenses (including, without limitation, reasonable attorneys' fees) arising from, or in connection with, the exercise by Lender of the Acceleration Option (including without limitation, those arising from, or in connection with, any actions taken by Lender to enforce compliance by CRC with its obligations in connection with the exercise by Lender of the Acceleration Option). 13. Notice. Any notice required or permitted to be given by either party to this Agreement shall be in writing, and shall be deemed to have been given when: (a) delivered in person to the other party; (b) sent by facsimile, with electronic confirmation of receipt; or (c) sent by national overnight delivery service. with confirmation of receipt, addressed as follows: to Lender at 200 North 33rd Street, Quincy, Illinois 62301, Facsimile: 311 -514 -116 t , Attn: J.D. Reindhardt; to Borrower at 770 3rd Avenue Southwest, Carmel, Indiana 46032, Facsimile: 317 - 587 -0340, Attn: Bruce Cordingley; and to CRC at City of Carmel, Indiana, One Civic Square, Carmel, Indiana 46032, Facsimile: 317 - 844 -3498, Attn: Les Olds, with a copy to: Karl P. Haas, Esq., Wallack Somers & Haas, PC, One Indiana Square, Suite 1500, Indianapolis, Indiana 46204, Facsimile: 317 - 231 -9900. Any party may change its address for notice from time to time by delivering notice to the other parties as provided above. 14. Authority. Each undersigned person executing this Agreement on behalf of Lender, Borrower, and CRC represents and certifies that: (a) he or she is empowered, and has been authorized by all necessary action of Lender, Borrower, and CRC, respectively, to execute and deliver this Agreement; (b) he or she has full capacity, power, and authority to enter into and carry out this Agreement; and (c) the execution, delivery, and performance of this Agreement have been authorized by Lender, Borrower, and CRC, respectively. 15. Severability. If any one or more of the terms or conditions of this Agreement is determined to be invalid, then: (a) such invalidity shall not affect any other term or condition of this Agreement; and (b) this Agreement shall be construed as if such invalid term or condition had never existed. The invalidity of any term or condition of this Agreement in any jurisdiction shall not affect the validity of such term or condition in any other jurisdiction. 16. Applicable Law. The validity, construction, interpretation, and enforcement of this Agreement shall be governed by, and construed in accordance with, the laws of the State of Indiana, without regard to Z: \Documents`.Shoup, Jenny \City of Carmel'Parcel 7 \PAC Equipment- Mercantile\Tri Pany AgreemenPSri Party Agreement -PAC Equipment. Mercanti Ie. v2a. wpd l Aug09 principles of conflicts of law. All actions or proceedings arising in connection with this Agreement shall be tried and litigated only in the state courts located in Hamilton County, Indiana, or the federal courts with venue that includes Hamilton County, Indiana. The parties waive, to the extent permitted under applicable law: (a) the right to a trial by jury; and (b) any right to assert the doctrine of "forum non conveniens" or to object to venue; in either case to the extent any proceeding is brought in accordance with this Section. 17. Miscellaneous. Subject to the terms and conditions of Section 10, this Agreement shall inure to the benefit of, and be binding upon, each of Lender, Borrower, and CRC, and their respective successors and assigns. If there is a conflict between the terms or conditions of this Agreement and any of the other Loan Documents, then the terms and conditions of this Agreement shall control. The captions used in this Agreement are for convenience only and are not to be construed as defining or limiting the terms and conditions of this Agreement. This Agreement constitutes the entire agreement among the parties with respect to the subject matter hereof, and may be modified, amended, or revised only by a written agreement signed by each of the parties. This Agreement may be executed in counterparts, each of which shall be an original, but all of which, when taken together, shall constitute the same agreement. All Exhibits referenced in this Agreement are attached hereto and incorporated herein by reference. IN WITNESS WHEREOF, Lender, Borrower, and CRC have executed this Agreement as of the date set forth above. Z: \Documents \Shoup, Jennv \City of Carmel \Parcel 7`•PAC Equipment- Mercantile.Tri Party Agreement \Tri Party Agreement -PAC Equipment.Mercantile v2a.wpd -12- MERCA BANK David W-.er, Vice President VILLAGE FINANCIAL, LLC By: Printed: Title: E O_ O R E S M. K i l O H N{ _E!' OR VI(;^ PC1 -Q r ,,l-' THE CITY OF CARMEL REDEVELOPMENT CT MISSION By: Ronald E. Carter, President 11Au_O) EXHIBIT B None