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EXHIBIT 10.15
DEED OF TRUST NOTE
$2,440,000.00 Silver Spring, Maryland
October 16, 1998
FOR VALUE RECEIVED, XXXXXXXXX CORPORATION, a Maryland corporation,
XXXXXXXXX CORPORATION OF AMERICA, a Maryland corporation, EXECUTIVE AMENITIES,
INC., a Maryland corporation, EXECUTIVE AMENITIES - WEST, INC., a Maryland
corporation, EXECUTIVE FURNITURE CENTRE, INC., a Maryland corporation, XXXXXX
CORPORATE HOUSING, INC., a New York corporation, and CORPORATE ACCOMMODATIONS,
INC., a Connecticut corporation (collectively, the "Maker"), jointly and
severally promise to pay to the order of CRESTAR BANK, a Virginia banking
corporation (or its successors or assigns) (the "Payee"), the principal sum of
TWO MILLION FOUR HUNDRED FORTY THOUSAND DOLLARS ($2,440,000.00), or so much
thereof as may be advanced pursuant to that certain Building Loan Agreement of
even date herewith between the Maker and the Payee (the "Loan Agreement") and
remain unpaid, together with accrued interest, at the rate hereinafter set
forth, on the unpaid principal balance hereof from time to time, from the date
of this Note until the date the entire principal sum hereof has been paid in
full. Said interest and principal shall be payable as set forth hereinbelow.
Interest, computed at the "Annual Rate" (hereinafter defined), shall be
due and payable in consecutive monthly installments on the first day of each and
every calendar month during the term of this Note commencing on November 1,
1998, except that the last such payment of interest shall be due on the
"Maturity Date" (hereinafter defined). On each such interest payment date, all
interest accrued to that date shall be due and payable.
In addition to and together with the payments of interest required
hereunder as set forth above, the principal balance of this Note shall be
payable as follows:
(a) Commencing on the "Conversion Date" (hereinafter defined), and
continuing on the first day of each and every calendar month thereafter through
and including the date that is one hundred nineteen (119) months after the
Conversion Date, the unpaid principal balance evidenced by this Note shall be
due and payable in consecutive equal monthly installments calculated by the
Payee on the basis of a twenty (20)-year amortization schedule; and
(b) The entire unpaid principal balance, together with accrued and
unpaid interest thereon, and all other obligations of Maker hereunder, if not
sooner paid, shall be due and payable in full on February 28, 2009 (the
"Maturity Date").
Until the Conversion Date, the "Annual Rate" shall mean a fluctuating
annual rate of interest equal to the sum of the "Libor Rate" (hereinafter
defined) plus two hundred basis points (2.0%). Provided that no default by the
Maker then exists under this Note or the "Deed of Trust" (hereinafter defined),
the Maker shall have the option (the "Conversion Option"), upon written
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notice to the Payee at least thirty (30) days prior to the Conversion Date, to
convert the Annual Rate on the entire principal amount evidenced by this Note
for the then remaining term hereof, commencing on the Conversion Date, to either
(i) a fluctuating annual rate equal to the sum of the Libor Rate plus one
hundred fifty basis points (1.5%), or (ii) a fixed annual rate of interest equal
to the sum of the "Cost of Funds Rate" (hereinafter defined) plus one hundred
fifty basis points (1.5%). If the Maker fails to give the Payee a timely notice
of the interest rate it elects under the Conversion Option, the Maker shall be
conclusively deemed to have duly elected alternative (i) in the preceding
sentence. The Maker's right to exercise the Conversion Option shall be subject
to the following terms and conditions: (a) prior to the Maker's exercise of the
Conversion Option, the "Improvements" (as defined in the Loan Agreement) shall
have been satisfactorily completed in accordance with the approved "Plans and
Specifications" (as defined in the Loan Agreement), as determined by the Payee
and the Payee's "Inspector" (as defined in the Loan Agreement), free and clear
of any mechanic's or materialmen's liens; and (b) the Conversion Option may be
exercised only once during the term of this Note and, once exercised, shall be
irrevocable. If the Maker duly exercises (or is deemed to have duly exercised)
the Conversion Option, then, commencing on the Conversion Date and continuing
thereafter until this Note is repaid in full, the "Annual Rate" shall mean the
annual rate of interest elected (or deemed to have been elected) by the Maker in
accordance with this paragraph. The "Conversion Date" shall mean the first day
of the first calendar month after the satisfactory completion of the
Improvements in accordance with the approved Plans and Specifications, as
determined by the Payee and the Payee's Inspector.
The "Libor Rate" means, with respect to any particular month in which the
interest rate under this Note is to be established or adjusted, the one month
LIBOR established by the British Bankers Association on the first "Business Day"
(hereinafter defined) of such month (or as of the date of this Note with respect
to the initial rate) as displayed on page 3750 of the Telerate Services,
Incorporated screen or on such other display as may replace such page, and as
adjusted by the Payee for reserves, brokers' commissions, regulatory costs, and
deposit insurance requirements. In the event the LIBOR established by the
British Bankers Association is not reported on the Telerate Services,
Incorporated screen on the first Business Day of any month in which an
adjustment is to be made hereunder, then for the purpose of determining the
"Libor Rate", the Payee shall refer to such other independent recognized source
of data or another interbank quotation reflecting the London Interbank Market as
the Payee may consider appropriate in its sole discretion. "Business Day" means
a day (i) on which banks in the City of London, England are generally open for
interbank or foreign exchange transactions, and (ii) that is not a Saturday,
Sunday, or a day on which banks are required or permitted to be closed in the
State of Maryland.
The "Cost of Funds Rate" means the annual rate of interest, as determined
by the Payee as of the date that is thirty (30) days prior to the Conversion
Date, that would be paid on a deposit or other obligation of the Payee with a
maturity comparable to that of this Note, issued by the Payee at par to an
institutional investor, adjusted for reserves, brokers' commissions, regulatory
costs, and deposit insurance requirements.
All regular monthly payments made on account hereof shall be applied first
to the payment of any late charges accrued and due, then to accrued and unpaid
interest, then to unpaid principal then due and payable, and any remainder of
any such payment shall be applied to unpaid principal
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to be due and payable on the Maturity Date, and thereafter to any unpaid
installments of principal in the inverse order of maturity. All interest
hereunder shall be calculated based upon a 360-day-year factor applied to actual
days.
Upon the occurrence of any default hereunder, then (a) if the indebtedness
evidenced hereby is then accruing interest at a fluctuating Annual Rate
calculated on the basis of the Libor Rate, such payment, and the then unpaid
principal balance hereof, shall bear interest thereafter at a rate equal to 2%
in excess of the Annual Rate until such time as any such payment, together with
accrued interest thereon, is received by the holder hereof, and (b) if said
indebtedness is then accruing interest at a fixed Annual Rate calculated on the
basis of the Cost of Funds Rate, such payment, and the then unpaid principal
balance hereof, shall bear interest thereafter at a rate equal to the greater of
(i) 2% per annum in excess of the Annual Rate, or (ii) 2% per annum plus the
prime rate of interest established and declared from time to time by the Payee
(which is not necessarily the lowest rate of interest charged by the Payee to
borrowers), until such time as such default is cured. In addition to the
provisions contained in the preceding sentence, if any payment is received by
the holder hereof more than 15 days after the date such payment is due, then the
Maker promises to pay to such holder a "late charge" as liquidated damages equal
to 5% of the amount of such payment which was required to be paid pursuant to
this Note.
All payments of principal, interest and other sums due hereunder shall be
made during regular business hours at the office of the Payee at 00000 Xxxxxxxx
Xxxx, Xxxxxx, Xxxxxxxx 00000, or at such other place as the holder of this Note
may from time to time designate in writing and shall be made in lawful money of
the United States of America which at the time of payment shall be legal tender
for the payment of public and private debts. All payments hereunder shall be
made without offset, demand, counterclaim, deduction, abatement, defense, or
recoupment, each of which Maker hereby waives.
This Note is made pursuant to the Loan Agreement and is secured by a Deed
of Trust and Security Agreement (the "Deed of Trust") of even date herewith
executed and delivered by the Maker and conveying to Xxxxxx X. Xxxxxxxxx and
Xxxxx Xxxx, Trustees, certain real property, together with any improvements
thereon, located in Xxxxxxxxxx County, Maryland, as more particularly described
in Exhibit "A" to the Deed of Trust (collectively, the "Property"). All of the
terms, covenants, conditions and provisions of the Loan Agreement and Deed of
Trust are hereby incorporated in and made a part of this Note to the same extent
as if herein set forth in full.
It is expressly agreed that time is of the essence of this Note. In the
event of a default in the payment of any amount hereunder as and when the same
becomes due and payable, or in the event of default by the Maker in the
performance of any of the terms, covenants, conditions or provisions of the Deed
of Trust, then, and in any of such events, the holder hereof may, at the option
of such holder, declare the entire outstanding principal balance hereof,
together with accrued interest thereon, late charges and any liquidated damages
provided for herein, and all other sums secured by the Deed of Trust to be
immediately due and payable without demand or further notice to the Maker or any
other person. Failure of the holder to exercise any rights hereunder shall not
constitute its waiver of the right to the later exercise thereof. All costs
incurred by the holder of this Note in connection with the indebtedness
evidenced hereby, including attorneys' fees (whether suit is brought or not),
shall be paid by the Maker on demand.
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So long as this Note is accruing interest at a fluctuating Annual Rate
calculated on the basis of the Libor Rate, the privilege is hereby reserved by
the Maker to prepay the principal of this Note in whole at any time, or in part
at any time and from time to time after the satisfactory completion of the
Improvements as described above, without any prepayment premium, upon no less
than thirty (30) days' prior written notice to the holder hereof and provided
that a payment of all accrued and unpaid interest to the date of such prepayment
is included with such prepayment as to the amount of principal being prepaid at
any time.
If this Note is accruing interest at a fixed Annual Rate calculated on the
basis of the Cost of Funds Rate, the privilege is hereby reserved by Maker to
prepay the principal of this Note in whole or in part at any time and from time
to time, provided that (a) the Maker shall provide no less than thirty (30)
days' prior written notice to the holder hereof of its intent to make any such
prepayment, (b) the Maker shall pay to the holder hereof at the time of each
such prepayment all accrued and unpaid interest to the date of such prepayment
as to the amount of principal being prepaid, and (c) the Maker shall also pay to
the holder hereof at the time of each such prepayment (whether such prepayment
is voluntary or involuntary), in consideration of the holder hereof accepting
such prepayment, a prepayment premium equal to the "Applicable Fraction"
(hereinafter defined) times an amount equal to the positive difference, if any,
calculated by subtracting (i) the present value of a series of hypothetical
payments, with one such hypothetical payment being made on the first day of each
calendar month from the date of the Maker's prepayment to and including the
Maturity Date, and with each such hypothetical payment being in an amount equal
to (A) one-twelfth (1/12th) of the applicable "Treasury Bond Yield" (hereinafter
defined) times (B) the principal amount that would have been outstanding under
this Note on the date of each such hypothetical payment if Maker had not made
the prepayment and if all amortization payments required under this Note had
been made as and when due prior to the date of each such hypothetical payment,
from (ii) the present value of the monthly payments of interest that would have
been payable under this Note from the date of the prepayment to and including
the Maturity Date if Maker had not made the prepayment and if all amortization
payments required under this Note had been made as and when due. The foregoing
present value calculations shall be made using an annual discount rate equal to
the applicable Treasury Bond Yield. The "Applicable Fraction" shall mean, with
respect to each prepayment, a fraction, the numerator of which is the amount of
that principal prepayment, and the denominator of which is the outstanding
principal amount of the indebtedness evidenced by this Note immediately prior to
that prepayment; and the "Treasury Bond Yield" shall mean, with respect to each
prepayment, the annual yield to maturity of non-callable debt obligations of the
United States Treasury having (x) an amount closest to, but not greater than,
the amount of the prepayment, and (y) a maturity closest to, but not greater
than, the number of months between the date of that prepayment and the Maturity
Date, all as reported in the Wall Street Journal (or, if the Wall Street Journal
is no longer published, as reported in another daily financial publication of
national circulation designated by the holder of this Note) on the fifth (5th)
business day preceding the date of that prepayment.
No prepayment premium will be charged with respect to involuntary
prepayments resulting from condemnation awards being paid to the holder hereof
or from proceeds from fire and/or casualty insurance being paid to the holder
hereof or with respect to payments of interest that would otherwise exceed
applicable law and are, therefore, treated as though they were prepayments of
principal hereunder. Partial prepayments shall not postpone or reduce any
regular payments of principal or interest, but shall be credited first to the
payment of any late charges accrued and due,
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then to other sums advanced by the Payee pursuant to the Deed of Trust, then to
accrued and unpaid interest, then to unpaid principal to be due and payable on
the Maturity Date and then, if applicable, to any unpaid installments of
principal in the inverse order of maturity.
Notwithstanding any provision herein or in the Deed of Trust or in any
other instrument or document executed in connection herewith, the total
liability for payments in the nature of interest shall not exceed the limits now
imposed by the usury laws of the jurisdiction whose laws govern the
interpretation and enforcement of this Note. If by reason of the acceleration of
the unpaid principal balance of this Note for any cause, or if, for any other
reason, interest in excess of the highest legal contract rate in said
jurisdiction shall at any time be paid, any such excess shall constitute and be
treated as a payment on the principal hereof and shall operate to reduce such
principal balance.
If any provision (or any part of any provision) contained in this Note
shall for any reason be held or deemed to be invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not affect
any other provision (or remaining part of the affected provision) of this Note,
and this Note shall be construed as if such invalid, illegal or unenforceable
provision (or part thereof) had never been contained herein and the remaining
provisions of this Note shall remain in full force and effect.
The Maker, all endorsers and guarantors hereof, and all others who may
become liable for all or any part of the obligation evidenced hereby, waive
presentment, demand, protest, notice of demand and of dishonor and of
nonpayment, and any and all lack of diligence or delays in collection or
enforcement hereof. The Maker and all endorsers and guarantors hereof further
jointly and severally expressly agree with the holder hereof that said holder
may, from time to time, extend or renew this Note or any payment hereunder
without notice, in such manner, on such terms and for such time(s) as the holder
may see fit, all without in any way affecting or releasing the liability of the
Maker and all endorsers and guarantors hereof.
In the event any default shall occur hereunder or under any other document
evidencing or securing the indebtedness evidenced hereby, the Maker authorizes
the clerk or any attorney of any court of record to appear for all or any one
(1) or more of the entities collectively comprising the Maker, in any court of
competent jurisdiction, to waive the issuance and service of process and to
enter judgment by confession in favor of the holder of this Note for the balance
(principal and all other sums secured by the Deed of Trust) then due on this
Note, together with court costs, interest and an attorney's fee of fifteen
percent (15%) of the principal and interest then due hereunder. No single
exercise of the foregoing power to confess judgment shall be deemed to exhaust
the power, whether or not any such exercise shall be held by any court to be
invalid, voidable or void, but the power shall continue undiminished, and it may
be exercised from time to time as often as the holder of this Note shall elect,
until such time as the holder of this Note shall have received payment in full
of all indebtedness of Maker to the holder of this Note.
WAIVER OF TRIAL BY JURY. THE MAKER HEREBY WAIVES TRIAL BY JURY IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR IN ANY WAY PERTAINING TO THIS NOTE AND/OR
ANY OF THE OTHER DOCUMENTS EVIDENCING OR SECURING THE DEBT TRANSACTION EVIDENCED
HEREBY. THIS WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY MADE BY MAKER, AND
MAKER HEREBY
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REPRESENTS THAT NO ORAL OR WRITTEN STATEMENTS HAVE BEEN MADE BY ANY PARTY TO
INDUCE THIS WAIVER OF TRIAL BY JURY OR TO IN ANY WAY MODIFY OR NULLIFY ITS
STATED EFFECT. MAKER FURTHER REPRESENTS THAT IT HAS BEEN REPRESENTED BY
INDEPENDENT COUNSEL, SELECTED OF ITS OWN FREE WILL, IN THE SIGNING OF THIS NOTE
AND IN THE MAKING OF THIS WAIVER AND THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS
THIS WAIVER WITH SUCH COUNSEL.
This Note is to be construed and enforced according to and governed by the
laws of the State of Maryland.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the Maker has caused this Note to be executed, sealed,
and delivered as of the day and year first above written.
WITNESS: MAKER:
XXXXXXXXX CORPORATION,
a Maryland corporation
By: [SEAL]
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Name:
---------------------------------
Title:
--------------------------------
XXXXXXXXX CORPORATION OF AMERICA,
a Maryland corporation
By: [SEAL]
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Name:
---------------------------------
Title:
--------------------------------
EXECUTIVE AMENITIES, INC.,
a Maryland corporation
By: [SEAL]
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Name:
---------------------------------
Title:
--------------------------------
EXECUTIVE AMENITIES - WEST, INC.,
a Maryland corporation
By: [SEAL]
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Name:
---------------------------------
Title:
--------------------------------
[ADDITIONAL SIGNATURES FOLLOW]
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EXECUTIVE FURNITURE CENTRE, INC.,
a Maryland corporation
By: [SEAL]
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Name:
---------------------------------
Title:
--------------------------------
XXXXXX CORPORATE HOUSING, INC.,
a New York corporation
By: [SEAL]
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Name:
---------------------------------
Title:
--------------------------------
CORPORATE ACCOMMODATIONS, INC.,
a Connecticut Corporation
By: [SEAL]
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Name:
---------------------------------
Title:
--------------------------------
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