DEED OF TRUST NOTE
$6,000,000.00 Baltimore, Maryland
February 27, 1996
For Value Received, HISTORIC PRESERVATION PROPERTIES 1990 L.P. TAX
CREDIT FUND, a Delaware limited partnership ("Borrower"), having an
address at c/o Claremont Management 'Corp., Batterymarch Park II,
Quincy, Massachusetts 02169, hereby promises to pay to the order
of AID ASSOCIATION FOR LUTHERANS, a Wisconsin corporation (AAL),
the principal sum of Six Million Dollars ($6,000,000.00) (the
"Loan"), and to pay interest from the date that AAL disburses the
Loan at the rate of seven and eighty-five hundredths percent
(7.85%) per annum to be paid in legal tender of the United States
of America. Payments shall be by preauthorized Automated
Clearinghouse transaction (ACH) or by such other reasonable method
as AAL directs, to its account at Xxxxxx Trust and Savings Bank,
Chicago, Illinois, Attention: Aid Association for Lutherans, Loan
No. 74530, or at such other place as AAL may from time to time
designate to Borrower in writing.
The principal and interest of this Deed Of Trust Note ("Note")
shall be due and payable in consecutive, equal monthly payments of
Forty Nine Thousand Six Hundred Twenty Eight Dollars ($49,628)
each, commencing on the fifteenth (15th) of April, 1996,
("Commencement Date") and continuing on the same day of each and
every month thereafter until this Note shall be paid in full.
Notwithstanding anything to the contrary, the remaining unpaid
principal balance and accrued interest thereon shall be due and
payable on the fifteenth (15th) of March, 2016. Each monthly
payment shall be applied first to payment of accrued interest and
then to the reduction of principal. Interest on this Note will be
computed on the basis of a 360-day year composed of twelve 30-day
months.
In the event the Loan is disbursed more than one month preceding
the "Commencement Date", interest is payable thirty (30) days'
prior to the Commencement Date. If the Loan is disbursed less than
one month preceding the Commencement Date, interest will be payable
on the Commencement Date, and the first installment of principal
and interest will be due one month later.
Borrower reserves no right to prepay the Loan during loan years one
through three (1 through 3), inclusive. A loan year is each twelve
(12) month period starting one month prior to the Commencement
Date. Commencing with the fourth (4th) loan year through the sixth
(6th) month of the tenth (10th) loan year (premium prepayment
period), Borrower shall have the right, following the giving of not
less than sixty (60) days, prior written notice to AAL, to prepay
all (and not less than all) of the then outstanding principal
balance of this Note, together with all interest accrued, but
unpaid thereon to the date of prepayment, plus a premium equal to
the amount prepaid times the privilege rate. The privilege rate
shall be equal to the product obtained by taking the difference
between (1) the interest rate oh the Loan and (2) the market yield
of U.S. Treasury issues as quoted daily in The Wall Street Journal
which have the closest maturity date (month and year) to the date
the Loan can be prepaid at par and multiplying this difference by
the remaining term of the premium prepayment period (the remaining
term to be expressed as a fraction 'equal to the number of days
remaining in the premium prepayment period over 365). The
prepayment privilege fee will be reduced to a present value on a
per period basis discounted at the above Treasury issues rate. In
no event, however, shall the fee be less than one percent (it) of
the outstanding principal balance of the Loan. After the sixth
(6th) month of the tenth (loth) loan year, the Loan may be prepaid
at par, upon sixty (60) days' prior written notice to AAL.
However, if there is a Disposition as described under Section 1.3,
Dispositions, of the Deed of Trust (hereinafter defined) and such
Disposition requires AAL's consent and AAL specifically refuses to
give such consent, Borrower may prepay with a premium of four
percent (4%) of the outstanding principal balance of the Loan
during loan years one through three (1 through 3) and at all other
times fifty percent (50%) of the applicable prepayment premium or
one percent (1%) of the outstanding principal balance of the Loan,
whichever is greater.
UPON AT LEAST SIX (6) MONTHS' PRIOR WRITTEN NOTICE, AAL HAS THE
OPTION TO DEC THE ENTIRE UNPAID PRINCIPAL BALANCE OF THE NOTE
AND ALL UNPAID, ACCRUED INTEREST THEREON, IMMEDIATELY DUE AND
PAYABLE AT THE END OF THE TENTH (IOTH) LOAN YEAR OR ANY TIME
THEREAFTER.
Time is of the essence with respect to each and every obligation of
Borrower set forth in this Note. In the event that Xxxxxxxx fails
to transmit any monthly payment of this Note when due, a late
payment privilege fee of three percent (3%) of the overdue payment
(but in no event less than Five Hundred and No/100 Dollars
($500.00)) shall be due, which fee at AAL's option may be either
required in addition to the monthly payment or Added to principal.
Borrower acknowledges this fee is reasonable under the
circumstances existing at the time this Note is made to compensate
AAL for its additional costs and expenses inc'ident to the handling
of such delinquent installment, including, without limitation,
disruption of AAL's accounting and bookkeeping operations, caused
by Xxxxxxxx's failure to make payment when due, and the loss of
AAL's ability to promptly reinvest the payments.
The payment of this Note is secured by: An Indemnity Deed of Trust
and Security Agreement ("Deed of Trust") of even date given by
Xxxxxxxxx'x Wharf Baltimore, L.P., a Delaware limited partnership
("Guarantor") , as grantor, to certain trustees therein for the
benefit of AAL, as beneficiary, encumbering certain real property
located in the City of Baltimore, State of Maryland. The Deed of
Trust and all other documents ansi agreements executed and delivered
as security for this Note are referred to collectively as the "Loan
Documents." Reference is hereby made to the Loan Documents for a
description of the nature and extent of such security and the
rights of AAL with respect to these,agreements.
Upon the occurrence of any of the following events ("Events of
Default"), AAL may, at its sole option, to be exercised at any time
thereafter, with notice to the Borrower of such option being hereby
expressly waived, declare the entire unpaid principal balance of
this Note and all unpaid, accrued interest thereon, immediately due
and payable:
(a) Failure of Borrower to make any payment of principal and/or
interest on this Note within ten (10) days of its due date;
(b) Failure of Borrower to comply with any provisions, obligations
or other representations contained in this Note or any of the Loa@
Documents and such failure is not cured by the performance so
required, and the remediation of any consequences the delay in such
performance may have caused, within fifteen (15) days after notice
of such failure is given to Borrower, provided, however, any
failure shall be deemed an Event of Default upon the occurrence
thereof (for which no notice shall be required and no cure period
shall be available to Borrower) if such failure (i) is the third
(3rd) to occur within any period of twelve (12) consecutive months
(and notice of the f irst two (2) failures has been sent to
Borrower) , regardless of whether the same or dif f erent failures are
involved and notwithstanding that Borrower may have cured within
any applicable cure period any previous failures occurring within
such twelve (12) month period, or (ii) in the reasonable discretion
of AAL, constitutes or creates a clear and present emergency or
threat to property described in the Deed of Trust or the lien or
security interest created in any of the Loan Documents. In the
event the f if teen (15) days cure period applies to a failure under
this subparagraph (b) and such f ailure cannot, in the sole
discretion of AAL, reasonably be cured within said f if teen (15) day
period, Borrower shall have an additional thirty (30) days to cure
such failure so long as Borrower is diligently pursuing said cure.
In no event shall the cure period exceed the total of forty-five
(45) days.
The failure of AAL to exercise the foregoing option or any other
right or remedy available hereunder, under any Loan Document, at
law, or in equity, shall not constitute a waiver of, or impair, the
right to exercise said option or any other right or remedy in the
event of any continuing or @sequent such failure.
Any amount payable under this Note which is unpaid at the maturity
thereof (whether by acceleration following an Event of Default,
AAL's election to declare this Note due at or after the end of the
tenth (10th) loan year, or at fixed maturity) shall bear interest
until paid at fifteen percent (15%) per annum ("Default Rate") from
and after maturity or the highest rate allowed by law, whichever is
less.
Notwithstanding the above, Xxxxxxxx agrees that upon the occurrence
of an Event of Default, followed by acceleration of the maturity of
this Note, a tender of an amount necessary to satisfy the entire
indebtedness shall be deemed a voluntary prepayment, and to the
extent permitted by law, shall include the foregoing prepayment
privilege fee; provided further that if such tender occurs in a
period in which there is no prepayment privilege, Borrower shall
pay a prepayment privilege fee in an amount equal to the amount
prepaid times the privilege rate defined above, but in no event
shall the fee be less than eight percent (8%-) of the outstanding
principal balance of the Loan.
This Note shall in all respects be governed and construed in
accordance with the laws of the State of Maryland. The parties
intend and believe that each provision in this Note comports with
all applicable local, state, and federal laws and judicial
decisions. However, if any provision of this Note is found by a
court of law to be illegal, unenforceable, or contrary to public
policy, then it is the intent of all parties hereto that such
provision be given force to the fullest possible extent permitted
by law, and that the remainder of this Note be construed as if such
illegal provision were not contained therein, and that the rights,
obligations, and interests of Borrower and AAL under the remainder
of this Note shall continue in full force and effect. For example,
if from any circumstances whatsoever, fulfillment of any provision
in this Note or the Loan Documents, would result in an amount paid
or agreed to be paid which exceeds the highest lawful rate
permissible under applicable usury laws, then, the obligation to be
fulfilled shall be reduced to the limit of such validity, and if
AAL shall receive as interest an amount which would exceed the
highest lawful rate, such amount shall be applied to the reduction
of the unpaid principal balance due hereunder in the inverse order
of maturity, and not to the payment of interest.
In the event of any inconsistency between provisions of this Note
and those of the Loan Documents, the provisions of this Note shall
control over those of the Loan Documents.
All persons or corporations or other entities now or at any time
liable, whether primarily or secondarily, for payment of the
indebtedness evidenced by this Note, expressly waive presentment
for payment, notice of dishonor, protest, notice of protest, and
diligence in collection; and consent that the time of payment may
be extended or released by AAL without in any way modifying,
releasing, or limiting Borrower's liability on the Deed of Trust.
Enforcement of Xxxxxxxx's liability hereunder shall be limited to
the mortgaged property, and any other collateral AAL may hold to
secure payment of this Note, and AAL shall not be entitled to seek
or obtain any def iciency judgment against Borrower, except that
Borrower (but not its constituent partners) shall be and remain
fully personally liable for the following:
(i) tenant security deposits in respect of each lease to the
extent not used to satisfy tenant arfearages of rent or to satisfy
damages caused by tenant default;
(ii) rents paid more than one (1) month in advance of its due
date;
(iii) rents and other similar sums received by Borrower or
Guarantor from the mortgaged property after an Event of Default
unless applied to (A) normal and necessary operating expenses of
the mortgaged property or (B) the indebtedness evidenced by this
Note (It is understood and agreed that all revenues derived from
the mortgaged property are to be held by Xxxxxxxx and Guarantor as
a trust fund to be used first for the payments due under this Note
and the then due and payable legitimate operating expenses of the
mortgaged property and only after such payments shall the revenues
be used for Borrower's or Guarantor's personal use and/or
distribution);
(iv) insurance or condemnation proceeds used for purposes
other than those set forth in Section 1.4 or in Article III of the
Deed of Trust, or as otherwise approved in writing by AAL;
(v) amounts necessary to pay taxes, assessments or any other
charges by a governmental entity which are a lien upon the
mortgaged property at the time AAL takes actual possession of the
mortgaged property or has a receiver appointed;
(vi) amounts necessary to pay any construction lien,
mechanics, liens, materialmen's liens or similar type lien against
the mortgaged property arising out of the act or omissions of
Borrower or Guarantor, provided, however, that Borrower and
Guarantor shall have the right to contest the amount or validity of
any such lien, by appropriate legal proceedings if: (x) the legal
proceedings shall operate to prevent the collection of such lien
and (y) Borrower and Guarantor shall deposit. with AAL or with the
appropriate court or other governmental authority or title
insurance company satisfactory to AAL an amount, with such
subsequent additions thereto as may be necessary or sufficient in
AAL's opinion to pay such liens, together with all estimated
interest and penalties in connection therewith;
(vii) taxes and fees required to be paid to any government
entity for the transfer of title;
(viii) damages suffered by AAL due to material
misrepresentation or waste committed by Xxxxxxxx, Guarantor or
their respective agents or employees; and
(ix) all actual attorneys' fees and other costs incurred by
AAL in order to recover from Borrower and/or Guarantor any amounts
for which Borrower or Guarantor remains personally liable as
provided in subparagraphs (i) through (viii) above.
Further, Borrower (but not its constituent partners) shall
remain personally liable for the prompt payment of the Loan, to the
extent of the then outstanding principal amount of the Loan, plus
accrued but unpaid interest thereon and any other sums due pursuant
to this Note or the Loan Documents, and actual attorneys' fees and
all other costs of collection, upon the occurrence of any of the
following:
(i) Borrower or Guarantor used fraud to induce AAL to make
the Loan evidenced by this Note;
(ii) AAL is prevented from acquiring title to the mortgaged
property following an Event of Default and AAL is unsuccessful in
collecting on any title insurance policy that it holds in
connection with the mortgaged property because of forfeiture of
Xxxxxxxx's or Guarantor's title under federal, state or local laws;
(iii) Borrower or Guarantor voluntarily files a petition or
commences any case or proceeding under any provision or chapter of
the United States Bankruptcy Code or any partner of Borrower or
Guarantor, or Xxxxxxxx X. Xxxxxxxx or any entity controlled by
Xxxxxxxx X. Xxxxxxxx files an involuntary petition against Borrower
or Guarantor;
(iv) Borrower or Guarantor makes an unconsented transfer of
interest in the mortgaged property as defined in Section 1.3
("Dispositions") of the Deed of Trust.
The obligations of the general partners of Borrower are joint and
several under this Note and the Loan Documents.
If Borrower or Guarantor fails to perform any of the required
covenants in this Note or the Deed of Trust or any other Loan
Document, or if AAL is made a party to any litigation by reason of
this Note or the Deed of Trust or any other Loan Document or if AAL
asserts or defends any of its rights in a bankruptcy proceeding,
then the Borrower shall pay all out-of -pocket expenses of AAL
(including but not limited to actual fees and disbursements of
counsel retained by AAL and the allocated costs for services of
AAL's in-house counsel) incurred, together with interest thereon at
the Default Rate from the date such expenses are incurred.
Borrower further covenants and agrees to pay any tax which is due
or becomes due in respect to the issuance or recording of the Loan
Documents or any security interest created thereby, and agrees to
hold harmless and indemnify AAL against any liability incurred by
reason of the imposition of any such tax.
In addition to all liens upon, and rights of setoff against, the
money, securities or other property of Borrower given to AAL by
law, Borrower hereby pledges, assigns, conveys, and transfers to
AAL a lien upon, security title to, a security interest in, and
right of setoff against all money, securities and other property of
Borrower now or hereafter in the possession of or on deposit with
AAL, whether held in a general or special account or deposit with
AAL, or for safe-keeping or otherwise, and every such lien,
security title, security interest, and right of setoff may be
exercised without demand upon or notice to Borrower. No lien,
security title, security interest, or right of setoff shall be
deemed to have been waived by any act or conduct on the part of
Lender, or by any neglect to exercise such right of setof f or to
enforce such lien, security title or security interest, or by any
delay in so doing, and every lien, security title, security
interest, and right of setof f shall continue in full force and
effect until specifically waived or released by an instrument in
writing executed by AAL.
Borrower waives trial by jury in any action brought on, under or by
virtue of this Note.
Any litigation in connection with, or arising out of, this Note
shall be brought in the state or federal court for the Baltimore
City, Maryland. Xxxxxxxx and AAL hereby consent to such court' a
exercise of personal jurisdiction over them. Borrower irrevocably
appoints Xxxxxxxx X. Xxxxxxxx, c/o Claremont Management
Corporation, Batterymarch Park II, Quincy, Massachusetts, 02169, as
Xxxxxxxx's agent for receipt of service of process on Xxxxxxxx's
behalf in connection with any suit, writ, attachment, execution or
discovery or supplementary proceedings in connection with the
enforcement of this Note. Service shall be effected by any means
permitted by the court in which any action is filed, or, at AAL's
option, by mailing process, postage prepaid, by certified mail,
return receipt requested, either to Xxxxxxxx's agent at the
foregoing address or to Borrower at Borrower' a address set forth on
the f irst page of this Note. Service shall be deemed ef f ective
upon receipt. Borrower and AAL may designate a change of address
for purposes of this paragraph by written notice to the other given
by certified mail, return receipt requested, at least ten (10) days
before such change of address is to become effective.
In Witness Whereof, the Borrower has caused this Note to be duly
executed as of the day and year first above written.
"Borrower"
HISTORIC PRESERVATION PROPERTIES 1990 L.P. TAX
CREDIT FUND, a Delaware limited partnership
By: BOSTON HISTORIC PARTNERS L.P., a Delaware
limited partnership, its sole general
partner
By: BHP II ADVISORS L.P., a Delaware
limited partnership, its sole
general partner
By: PORTFOLIO ADVISORY SERVICES II,
INC., a Massachusetts
corporation, general partner
by: Xxxxxxxx X. Xxxxxxx,
President
and
By: Xxxxxxxx X. Xxxxxxxx
General Partner
This is to certify that this is this Note described in a certain
Indemnity Deed of Trust and Security Agreement dated as of even
date herewith on the mortgaged property located in Baltimore City,
Maryland, described therein on a loan made by Aid Association for
Lutherans. This Note and the Indemnity Deed of Trust and Security
Agreement securing same were executed in presence.
Notary Public
Xxxxxx Xxxxx
My Commission Expires
8/27/97
