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EXHIBIT 10.1
MORTGAGE NOTE
New York, New York
$265,000,000 December 12, 1997
FOR VALUE RECEIVED, MHC FINANCING LIMITED PARTNERSHIP, an Illinois limited
partnership ("MHC"), XXXXXX XXXX, not personally, but solely as surviving
trustee under Trust Agreement and Declaration of Trust dated April 15, 1986 and
known as Trust Xx. 00000 (xxx "Xxxxx"), XXXXXXXXXX VISTAS, INC., an Illinois
corporation ("Orangeland"), PENNLAND VISTAS, INC., an Illinois corporation
("Pennland"), and XXXXXXXX VISTAS, INC., an Illinois corporation ("Xxxxxxxx"),
each having its principal office at c/o Manufactured Home Communities, Inc., 0
Xxxxx Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxx 00000 (MHC, the Trust,
Orangeland, Pennland and Xxxxxxxx are collectively referred to herein as,
"Maker"), jointly and severally promise to pay to the order of MIDLAND LOAN
SERVICES, L.P., a Missouri limited partnership, or its assigns ("Payee"), having
its principal office at 000 Xxxx 00xx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000, the
Principal Amount (as defined below), together with interest on the outstanding
principal balance hereunder from the date hereof at the Applicable Interest Rate
(as defined below). Interest accruing hereunder shall be calculated on the basis
of a 360-day year composed of twelve (12) months of thirty (30) days each.
WHEN USED HEREIN, the following capitalized terms shall have
the following meanings:
"Applicable Interest Rate" shall mean (a) from the date of this Note through but
not including the Reset Date (as hereinafter defined), a rate of seven and
978/10,000 percent (7.0978%) per annum (the "Initial Interest Rate") and (b)
from and after the Reset Date through and including the date this Note is paid
in full, a rate per annum equal to the greater of (i) the Initial Interest Rate
plus two percent (2.0%) or (ii) the Treasury Rate (as hereinafter defined) plus
two percent (2.0%) (the "Revised Interest Rate"). For purposes of this Note, (A)
the term "Reset Date" shall mean the date that is the tenth (10th) year
anniversary of the last day of the month in which the Closing Date occurs and
(B) the term Treasury Rate" shall mean, as of the Reset Date, the yield,
calculated by linear interpolation (rounded to the nearest one-thousandth of one
percent) of noncallable United States Treasury obligations with terms (one
longer and one shorter) most nearly approximating the period from the Reset Date
to the date which is ten (10) years after the Reset Date, as determined by Payee
on the basis of Federal Reserve Statistical Release H.15 Selected Interest Rates
under the heading U.S.
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Governmental Security/Treasury Constant Maturities or other recognized source of
financial market information selected by Payee during the week prior to the
Reset Date.
"Commencement Date" shall be February 1, 1998.
"Closing Date" shall be December 12, 1997.
"Default Rate" shall be the Applicable Interest Rate plus three percent
(3.0%) per annum.
"Initial Monthly Amount" shall be $1,567,430.83.
"Maturity Date" shall be January 2, 2028 or, if such day is not a
Business Day, then on the next preceding Business Day
"Payment Date" shall be the first Business Day of each month commencing
on February 1, 1998 and continuing thereafter through and including the Maturity
Date.
"Principal Amount" shall be $265,000,000.
Capitalized terms not defined herein shall have the meaning ascribed to
them in the Mortgage (as hereinafter defined).
1. The Principal Amount and interest thereon shall be due and payable
in lawful money of the United States as follows
(a) Prior to the Reset Date, interest shall accrue on the
unpaid principal balance from time to time outstanding on this Note at
the Initial Interest Rate. On the Closing Date, all interest on the
unpaid balance through the end of the month in which the Closing Date
occurs shall be due and payable. Thereafter, commencing on the
Commencement Date and continuing until the Payment Date next following
the Reset Date, 120 equal monthly installments of interest only at the
Initial Monthly Amount each shall be due and payable. Each such monthly
installment shall be due on each Payment Date and shall bear interest
from and after the applicable Payment Date (if and to the extent not
then paid to Lender).
(b) In the event that the Maker does not prepay the entire
Principal Amount of this Note and any other amounts outstanding on or
before the Reset Date, then interest shall thereafter accrue on the
unpaid principal balance from time to time outstanding on this Note at
the Revised Interest Rate and Maker shall pay on February 1, 2008 and
on each Payment Date thereafter up to and including the Maturity Date
the payments provided for in Section 4 of the Cash Collateral Agreement
(as defined below) in the order of priority set forth therein. Interest
accrued at the Revised Interest
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Rate and not paid pursuant to the preceding sentence shall be deferred
and added to the Debt and shall accrue interest at the Revised Interest
Rate (to the extent permitted by applicable law) (such accrued interest
is hereinafter referred to as "Accrued Interest"). All of the Debt,
including Accrued Interest, shall be due and payable on the Maturity
Date.
(c) In addition, all amounts advanced by Payee pursuant to
applicable provisions of the Loan Documents (as hereinafter defined),
together with any interest at the Default Rate or other charges as
therein provided, shall be due and payable hereunder two days after
written demand therefor by Payee to Maker or as otherwise provided by
the Loan Documents. In the event any such advance is not so repaid by
Maker, Payee may, at its option, first apply any payments received
hereunder to repay said advances together with any interest thereon or
other charges as provided in the Loan Documents, and the balance, if
any, shall be applied in payment of any installment then due. The
entire remaining unpaid balance of principal of this Note, all interest
accrued thereon and all other sums payable hereunder or under the Loan
Documents (collectively, the "Debt") shall be due and payable in full
on the Maturity Date.
(d) Amounts due on this Note shall be payable, without any
counterclaim, setoff or deduction whatsoever, in accordance with the
Cash Collateral Agreement or as Payee or its agent or designee may
otherwise from time to time designate in writing.
2. This Note is secured by an Amended, Restated and Consolidated
Renewal Indenture of Mortgage, Deed of Trust, Security Agreement, Financing
Statement, Fixture Filing and Assignment of Leases, Rents and Security Deposits,
of even date herewith (the "Mortgage") from Maker for the benefit of Payee, by
an Assignment of Rents and Leases of even date herewith (the "Assignment")
from Maker to Payee and by a Cash Collateral Account Security, Pledge,
Assignment and Control Agreement of even date herewith (the "Cash Collateral
Agreement") between Maker and Payee. The Mortgage, the Assignment, the Cash
Collateral Agreement and any other instrument given at any time to secure this
Note are hereinafter collectively called the "Loan Documents."
3. (a) Maker shall have no right to prepay the principal of this Note
in full or in part at any time prior to the Reset Date, except as hereinafter
set forth in this paragraph 3.
(b) Maker shall have the right to prepay the principal of this
Note from the proceeds of insurance or condemnation awards in accordance with
Section 6 of the Mortgage.
(c) Maker shall have the right to effect a Defeasance of this Note
in whole or in part at the times and otherwise in accordance with the terms and
conditions set forth in the Mortgage.
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(d) Notwithstanding the foregoing, this Note may be prepaid in
whole or in part without regard to the Defeasance requirements of the Mortgage
at any time after the date which is three (3) months prior to the Reset Date.
Any partial prepayments of principal shall not change the Payment Dates or
amounts of subsequent monthly installments, unless Payee shall otherwise agree
in writing.
(e) Upon acceleration of this Note in accordance with its terms
and the terms of the Loan Documents, Maker agrees that Payee shall be entitled
to add to the then outstanding principal amount due hereunder the positive
difference between (i) the amount of the Defeasance Collateral that would be
required to effect a Defeasance of this Note as of the date of such tender and
(ii) the then outstanding principal amount due hereunder. A tender of payment of
the amount necessary to pay and satisfy the entire unpaid principal balance of
this Note or any portion thereof at any time after an Event of Default or an
acceleration by Payee of the indebtedness evidenced hereby, whether such payment
is tendered voluntarily, during or after foreclosure of the Mortgage, or
pursuant to realization upon other security, shall constitute a purposeful
evasion of the prepayment terms of this Note, shall be deemed to be a voluntary
prepayment hereof, and Maker shall be required to pay the amount described
above.
4. If Maker defaults in the payment of any installment of principal
and interest on the date on which it shall fall due or in the performance of any
of the agreements, conditions, covenants, provisions or stipulations contained
in this Note or in the Loan Documents, and if such default shall continue beyond
any grace period provided for in the Mortgage so as to constitute an Event of
Default thereunder, then Payee, at its option and without further notice to
Maker, may declare immediately due and payable the entire unpaid principal
balance of this Note, together with interest thereon at an annual rate after the
date of such default equal to the Default Rate, together with all sums due by
Maker under the Loan Documents, anything herein or in the Loan Documents to the
contrary notwithstanding. The foregoing provision shall not be construed as a
waiver by Payee of its right to pursue any other remedies available to it under
the Mortgage, this Note or any other Loan Document, nor shall it be construed to
limit in any way the application of the Default Rate. Any payment hereunder may
be enforced and recovered in whole or in part at such time by one or more of the
remedies provided to Payee in this Note or in the Loan Documents. In the event
that: (i) this Note or any Loan Document is placed in the hands of an attorney
for collection or enforcement or is collected or enforced through any legal
proceeding; (ii) an attorney is retained to represent Payee in any bankruptcy,
reorganization, receivership, or other proceedings affecting creditors' rights
and involving a claim under this Note or any Loan Document; (iii) an attorney is
retained to protect or enforce the lien of the Mortgage or any Loan Document; or
(iv) an attorney is retained to represent Payee in any other proceedings
whatsoever in connection with this Note, the Mortgage, any of the Loan
Documents or any portion of the Trust Estate subject thereto, then Maker shall
pay to Payee all reasonable out-of-pocket attorney's fees, costs and expenses
incurred in connection therewith, including costs of appeal, together with
interest on any judgment obtained by Payee at the Default Rate.
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5. If Maker defaults in the payment of any monthly installment of
principal (other than the final installment due upon acceleration or on the
Maturity Date), interest or required escrows for more than ten (10) days after
any Payment Date therefor, then Maker shall pay to Payee a late payment charge
in an amount equal to three percent (3%) of the amount of the installment not
paid as aforesaid. An additional late charge equal to three percent (3%) of the
monthly payment due will be charged for each successive month the payment
remains outstanding. Said late charge payments if payable, shall be secured by
the Mortgage and the other Loan Documents, shall be payable without notice or
demand by Payee, and are independent of and have no effect upon the rights of
Payee under paragraph 4 above.
6. Maker and all endorsers, sureties and guarantors hereby jointly
and severally waive all applicable exemption rights, valuation and appraisement,
presentment for payment, demand, notice of demand, notice of nonpayment or
dishonor, protest and notice of protest of this Note, and all other notices in
connection with the delivery, acceptance, performance, default or enforcement of
the payment of this Note. Maker and all endorsers, sureties and guarantors
consent to any and all extensions of time, renewals, waivers or modifications
that may be granted by Payee with respect to the payment or other provisions of
this Note and to the release of the collateral or any part thereof, with or
without substitution, and agree that additional makers, endorsers, guarantors or
sureties may become parties hereto without notice to them or affecting their
liability hereunder.
7. Payee shall not be deemed, by any act of omission or commission,
to have waived any of its rights or remedies hereunder unless such waiver is in
writing and signed by Payee, and then only to the extent specifically set forth
in writing. A waiver of one event shall not be construed as continuing or as a
bar to or waiver of any right or remedy to a subsequent event,
8. This Note shall be governed by and construed in accordance with
the laws of the State of New York (the "State").
9. The parties hereto intend and believe that each provision in this
Note comports with all applicable law. However, if any provision in this Note is
found by a court of law to be in violation of any applicable law, and if such
court should declare such provision of this Note to be unlawful, void or
unenforceable as written, then it is the intent of all parties hereto that such
provision shall be given full force and effect to the fullest possible extent
that is legal, valid and enforceable, that the remainder of this Note shall be
construed as if such unlawful, void or unenforceable provision were not
contained therein, and that the rights, obligations and interest of Maker and
the holder hereof under the remainder of this Note shall continue in full force
and effect; provided however, that if any provision of this Note which is found
to be in violation of any applicable law concerns the imposition of interest
hereunder, the rights, obligations and interests of Maker and Payee with respect
to the imposition of interest hereunder shall be governed and controlled by the
provisions of the following paragraph.
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10. It being the intention of Payee and Maker to comply with the laws
of the State with regard to the rate of interest charged hereunder, it is agreed
that, notwithstanding any provision to the contrary in this Note, the Mortgage,
or any of the other Loan Documents, no such provision, including without
limitation any provision of this Note providing for the payment of interest or
other charges, shall require the payment or permit the collection of any amount
("Excess Interest") in excess of the maximum amount of interest permitted by
law to be charged for the use or detention, or the forbearance in the
collection, of all or any portion of the indebtedness evidenced by this Note. If
any Excess Interest is provided for, or is adjudicated to be provided for, in
this Note, the Mortgage, or any of the other Loan Documents, then in such event:
(i) the provisions of this paragraph shall govern;
(ii) Maker shall not be obligated to pay any Excess
Interest;
(iii) any Excess Interest that Payee may have received
hereunder shall, at the option of Payee, be (x) applied as a
credit against the unpaid principal balance then due under this
Note, accrued and unpaid interest thereon not to exceed the
maximum amount permitted by law, or both, (y) refunded to the
payor thereof or (z) any combination of the foregoing;
(iv) the applicable interest rate or rates provided for
herein shall be automatically subject to reduction to the maximum
lawful rate allowed to be contracted for in writing under the
applicable usury laws of the aforesaid State, and this Note, the
Mortgage and the other Loan Documents shall be deemed to have
been, and shall be, reformed and modified to reflect such
reduction in such interest rate or rates; and
(v) Maker shall not have any action or remedy against Payee
for any damages whatsoever or any defense to enforcement of this
Note, the Mortgage or any other Loan Document arising out of the
payment or collection of any Excess Interest.
11. Upon any endorsement, assignment, or other transfer of this Note
by Payee or by operation of law, the term "Payee," as used herein, shall mean
such endorsee, assignee, or other transferee or successor to Payee then becoming
the holder of this Note. This Note shall inure to the benefit of Payee and its
successors and assigns and shall be binding upon the undersigned and its
successors and assigns. The term "Maker" as used herein shall include the
respective successors and assigns, legal and personal representatives,
executors, administrators, devisees legatees and heirs of maker.
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12. Any notice, demand or other communication which any party may
desire or may be required to give to any other party shall be in writing and
shall be given as provided in the Mortgage.
13. To the extent that Maker makes a payment or Payee receives any
payment or proceeds for Maker's benefit, which are subsequently invalidated,
declared to be fraudulent or preferential, set aside or required to be repaid to
a trustee, debtor in possession, receiver, custodian or any other party under
any bankruptcy law, common law or equitable cause, then, to such extent, the
obligations of Maker hereunder intended to be satisfied shall be revived and
continue as if such payment or proceeds had not been received by Payee.
14. Maker shall execute and acknowledge (or cause to be executed and
acknowledged) and deliver to Payee all documents, and take all actions,
reasonably required by Payee from time to time to confirm the rights created or
now or hereafter intended to be created under this Note and the Loan Documents,
to protect and further the validity, priority and enforceability of this Note
and the Loan Documents, to subject to the Loan Documents any property of Maker
intended by the terms of any one or more of the Loan Documents to be encumbered
by the Loan Documents, or otherwise carry out the purposes of the Loan Documents
and the transactions contemplated thereunder; provided, however, that no such
further actions, assurances and confirmations shall increase Maker's obligations
under this Note or the Loan Documents.
15. No modification, amendment, extension, discharge, termination or
waiver (a "Modification ") of any provision of this Note, or any one or more of
the other Loan Documents, nor consent to any departure by Maker therefrom, shall
in any event be effective unless the same shall be in a writing signed by the
party against whom enforcement is sought, and then such waiver or consent shall
be effective only in the specific instance, and for the purpose, for which
given. Except as otherwise expressly provided herein, no notice to, or demand
on, Maker shall entitle Maker to any other or future notice or demand in the
same, similar or other circumstances. Payee does not hereby agree to, nor does
Payee hereby commit itself to, enter into any Modification.
16. Maker hereby expressly and unconditionally waives, in connection
with any suit, action or proceeding brought by Payee on this Note, any and every
right it may have to (a) a trial by jury, (b) interpose any counterclaim therein
(other than a counterclaim which can only be asserted in the suit, action or
proceeding brought by Payee on this Note and cannot be maintained in a separate
action) and (c) have the same consolidated with any other or separate suit,
action or proceeding.
17. Notwithstanding any provision to the contrary in the Mortgage,
this Note or the Loan Documents, recourse to the EXculpated Parties (as defined
in the Mortgage) with respect to any claims arising under or in connection with
this Note shall be limited to the extent provided in Section 33 of the Mortgage.
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18. [Reserved]
19. Any legal action or proceeding with respect to this Note and any
action for enforcement of any judgment in respect thereof may be brought in the
courts of the State of New York or of the United States of America for the
Southern District of New York, and, by execution and delivery of this Note,
Maker hereby accepts for itself and in respect of its property, generally and
unconditionally, the non-exclusive jurisdiction of the aforesaid courts and
appellate courts from any thereof. Maker irrevocably consents to the service of
process out of any of the aforementioned courts in any such action or proceeding
by the mailing of copies thereof by registered or certified mail, postage
prepaid, to Maker at the address for notices set forth in the Mortgage. Maker
hereby irrevocably waives any objection which it may now or hereafter have to
the laying of venue of any of the aforesaid actions or proceedings arising out
of or in connection with this Maker brought in the courts referred to above and
hereby further irrevocably waives and agrees not to plead or claim in any such
court that any such action or proceeding brought in any such court has been
brought in an inconvenient forum. Nothing herein shall affect the right of Payee
to serve process in any other manner permitted by law or to commence legal
proceedings or otherwise proceed against Maker in any other jurisdiction.
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IN WITNESS WHEREOF, Maker has caused this Note to be executed and
delivered as of the day and year first above written.
Signed in the presence of: MHC FINANCING LIMITED
PARTNERSHIP, an Illinois limited
partnership
By: MHC-QRS, Inc., a Delaware
corporation, its sold
general partner
/s/ Xxxxx Xxxxxx By: /s/ Xxxxx Xxxxxxxx
------------------------- ----------------------
Print Name: Xxxxx Xxxxxx Name: Xxxxx Xxxxxxxx
Title: Executive Vice President
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/s/ Xxxxx Xxxxxx /s/ Xxxxxx Xxxx
-------------------------- -----------------------------------
Print Name: Xxxxx Xxxxxx XXXXXX XXXX, NOT PERSONALLY
OR INDIVIDUALLY, BUT SOLELY
IN HIS CAPACITY AS TRUSTEE
UNDER AN AGREEMENT AND
DECLARATION OF TRUST NUM-
BER 41586 DATED AS OF APRIL 15,
1986
Signature Page - Note
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ORANGELAND VISTAS, INC.,
an Illinois corporation
/s/ Xxxxx Xxxxxx By: /s/ Xxxx X. Xxxxxxx
------------------------- ----------------------------------------
Print Name: Xxxxx Xxxxxx Name: Xxxx X. Xxxxxxx
Title: Vice President
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PENNLAND VISTAS, INC.,
an Illinois corporation
/s/ Xxxxx Xxxxxx By: /s/ Xxxx X. Xxxxxxx
--------------------------- -----------------------------------
Print Name: Xxxxx Xxxxxx Name: Xxxx X. Xxxxxxx
Title: Vice President
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XXXXXXXX XXXXXX, XXX.,
an Illinois corporation
/s/ Xxxxx Xxxxxx By: /s/ Xxxx X. Xxxxxxx
------------------------- ----------------------------------------
Print Name: Xxxxx Xxxxxx Name: Xxxx X. Xxxxxxx
Title: Vice President
