PROMISSORY NOTE
$8,160,000.00 June 24, 1999
FOR VALUE RECEIVED, the undersigned, Xxxxx Cove Apartments LLC, a
Georgia limited liability company ("Borrower"), whose address is Xxxxxx X.
Xxxxx, CFO, 000 Xxxxx Xxxxxx, Xxxxxx Xxxxx, Xxxxxxx, Xxxxxxx 00000,
promises to pay to the order of FIRST UNION NATIONAL BANK, a national
banking association ("Lender"), at the office of Lender at One First Union
Center, DC6, 000 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-
0166, or at such other place as Lender may designate to Borrower in writing
from time to time, the principal sum of Eight Million One Hundred Sixty
Thousand and 00/100 DOLLARS ($8,160,000.00) together with interest on so
much thereof as is from time to time outstanding and unpaid, from the date
of the advance of the principal evidenced hereby, at the rate of seven and
seventy-three hundredths (7.730%) percent per annum (the "Note Rate"), in
lawful money of the United States of America, which shall at the time of
payment be legal tender in payment of all debts and dues, public and
private.
ARTICLE 1 TERMS AND CONDITIONS
1.01 COMPUTATION OF INTEREST. Interest shall be computed hereunder based
on a 360-day year and paid for on the actual number of days elapsed for any
whole or partial month in which interest is being calculated. Interest shall
accrue from the date on which funds are advanced (regardless of the time of
day) through and including the day on which funds are credited pursuant to
Section 1.02 hereof.
1.02 PAYMENT OF PRINCIPAL AND INTEREST. Payments in federal funds
immediately available in the place designated for payment received by
Lender prior to 2:00 p.m. local time on a day on which Lender is open for
business at said place of payment shall be credited prior to close of
business, while other payments may, at the option of Lender, not be
credited until immediately available to Lender in federal funds at the
place designated for payment prior to 2:00 p.m. local time at said place of
payment on a day on which Lender is open for business. Such principal and
interest shall be payable in equal consecutive monthly installments of
$58,346.50 each, beginning on the first day of the second full calendar
month following the date of this Note (or on the first day of the first
full calendar month following the date hereof, in the event the advance of
the principal amount evidenced by this Note is the first day of a calendar
month)(the "First Payment Date"), and continuing on the first day of each
and every month thereafter (each, a "Payment Date") through and including
July 1, 2009 (the "Maturity Date"), at which time the entire outstanding
principal balance hereof, together with all accrued but unpaid interest
thereon, shall be due and payable in full.
1.03 APPLICATION OF PAYMENTS. So long as no Event of Default (as
hereinafter defined) exists hereunder or under any other Loan Document,
each such monthly installment shall be applied first, to any amounts
hereafter advanced by Lender hereunder or under any other Loan Document,
second, to any late fees and other amounts payable to Lender, third, to the
payment of accrued interest and last to reduction of principal.
1.04 PAYMENT OF SHORT INTEREST. If the advance of the principal
amount evidenced by this Note is made on a date other than the first day of
a calendar month, then Xxxxxxxx shall pay to Lender contemporaneously with
the execution hereof interest at the Note Rate for a period from the date
hereof through and including the last day of this calendar month.
1.05 PREPAYMENT; DEFEASANCE
(a) This Note may not be prepaid, in whole or in part (except as
otherwise specifically provided herein), at any time. In the event that
Xxxxxxxx wishes to have the Security Property (as hereinafter defined)
released from the lien of the Security Instrument (as hereinafter defined),
Borrower's sole option shall be a Defeasance (as hereinafter defined) upon
satisfaction of the terms and conditions set forth in Section 1.05(d)
hereof. This Note may be prepaid in whole but not in part without premium
or penalty on any Payment Date occurring within three (3) months prior to
the Maturity Date provided (i) written notice of such prepayment is
received by Payee not more than ninety (90) days and not less than thirty
(30) days prior to the date of such prepayment, and (ii) such prepayment is
accompanied by all interest accrued hereunder through and including the
date of such prepayment and all other sums due hereunder or under the other
Loan Documents. If, upon any such permitted prepayment on a Payment Date
occurring during the three (3) months prior to the Maturity Date, the
aforesaid prior written notice has not been timely received by Xxxxxx,
there shall be due a prepayment fee equal to, an amount equal to the lesser
of (i) thirty (30) days' interest computed at the Note Rate on the
outstanding principal balance of this Note so prepaid and (ii) interest
computed at the Note Rate on the outstanding principal balance of this Note
so prepaid that would have been payable for the period from, and
including, the date of prepayment through the Maturity Date of this Note as
though such prepayment had not occurred. Notwithstanding the foregoing, in
the event that Borrower makes a prepayment in accordance with this Section
on a date other than a Payment Date such prepayment must include all
interest through and including the following Payment Date.
Prepayments of this Note shall not be permitted, except for
partial or whole prepayments resulting from Xxxxxx's election to apply
insurance or condemnation proceeds to reduce the outstanding principal
balance of this Note as provided in the Security Instrument, in which event
no prepayment fee or premium shall be due unless, at the time of either
Xxxxxx's receipt of such proceeds or the application of such proceeds to
the outstanding principal balance of this Note, an Event of Default, or an
event which, with notice or the passage of time, or both, would constitute
an Event of Default, shall have occurred, which default or Event of Default
is unrelated to the applicable casualty or condemnation, in which event the
applicable prepayment fee or premium shall be due and payable based upon
the amount of the prepayment. No notice of prepayment shall be required
under the circumstances specified in the preceding sentence. No principal
amount repaid may be reborrowed. Any such partial prepayments of principal
shall be applied to the unpaid principal balance evidenced hereby but such
application shall not reduce the amount of the fixed monthly installments
required to be paid pursuant to Section 1.02 above except as otherwise
provided in the Security Instrument. Except as otherwise expressly
provided in this Section 1.05(b), the prepayment fees provided in the
immediate following paragraph shall be due, to the extent permitted by
applicable law, under any and all circumstances where all or any portion of
this Note is paid prior to the Maturity Date, whether such prepayment is
voluntary or involuntary, including, without limitation, if such prepayment
results from Lender's exercise of its rights upon Borrower's default and
acceleration of the Maturity Date of this Note (irrespective of whether
foreclosure proceedings have been commenced), and shall be in addition to
any other sums due hereunder or under any of the other Loan Documents. No
tender of a prepayment of this Note with respect to which a prepayment fee
is ue shall be effective unless such prepayment is accompanied by the
applicable prepayment fee.
If, prior to the fourth (4th) anniversary of the First Payment
Date (the "LOCKOUT EXPIRATION DATE"), the indebtedness evidenced by this
Note shall have been declared due and payable by Lender pursuant to Article
II hereof or the provisions of any other Loan Document due to a default by
Xxxxxxxx, then, in addition to the indebtedness evidenced by this Note
being immediately due and payable, there shall also then be immediately due
and payable a sum equal to the interest which would have accrued on the
principal balance of this Note at the Note Rate from the date of such
acceleration to the Lock-out Expiration Date, together with a prepayment
fee in an amount equal to the Yield Maintenance Premium (as hereinafter
defined) based on the entire indebtedness on the date of such acceleration.
If such acceleration is on or following the Lockout Expiration Date, the
Yield Maintenance Premium shall also then be immediately due and payable as
though Borrower were prepaying the entire indebtedness on the date of such
acceleration. In addition to the amounts described in the two preceding
sentences, in the event any such acceleration or tender of payment of such
indebtedness occurs or is made on or prior to the Lockout Expiration Date,
there shall also then be immediately due and payable an additional
prepayment fee of three percent (3%) of the principal balance of this Note.
The term "YIELD MAINTENANCE PREMIUM" shall mean an amount equal to the
greater of (A) two percent (2.0%) of the principal amount being prepaid,
and (B) the present value of a series of payments each equal to the Payment
Differential (as hereinafter defined) and payable on each Payment Date over
the remaining original term of this Note and on the Maturity Date,
discounted at the Reinvestment Yield (as hereinafter defined) for the
number of months remaining as of the date of such prepayment to each such
Payment Date and the Maturity Date. The term "PAYMENT DIFFERENTIAL" shall
mean an amount equal to (i) the Note Rate less the Reinvestment Yield,
divided by (ii) twelve (12) and multiplied by (iii) the principal sum
outstanding under this Note after application of the constant monthly
payment due under this Note on the date of such prepayment, provided that
the Payment Differential shall in no event be less than zero. The term
"REINVESTMENT YIELD" shall mean an amount equal to the lesser of (i) the
yield on the U.S. Treasury issue (primary issue) with a maturity date
closest to the Maturity Date, or (ii) the yield on the U.S. Treasury issue
(primary issue) with a term equal to the remaining average life of the
indebtedness evidenced by this Note, with each such yield being based on
the bid price for such issue as published in the WALL STREET JOURNAL on the
date that is fourteen (14) days prior to the date of such prepayment set
forth in the notice of prepayment (or, if such bid price is not published
on that date, the next preceding date on which such bid price is so
published) and converted to a monthly compounded nominal yield. In the
event that any prepayment fee is due hereunder, Xxxxxx shall deliver to
Borrower a statement setting forth the amount and determination of the
prepayment fee, and, provided that Lender shall have in good faith applied
the formula described above, Borrower shall not have the right to challenge
the calculation or the method of calculation set forth in any such
statement in the absence of manifest error, which calculation may be made
by Lender on any day during the fifteen (15) day period preceding the date
of such prepayment. Lender shall not be obligated or required to have
actually reinvested the prepaid principal balance at the Reinvestment Yield
or otherwise as a condition to receiving the prepayment fee.
(d) (i) At any time after the later of (x) the Lockout
Expiration Date, and (y) the date which is two (2) years after the "startup
day," within the meaning of Section 860G(a) (9) of the Internal Revenue
Code of 1986, as amended from time to time or any successor statue (the
"CODE"), of the "real estate mortgage investment conduit," within the
meaning of Section 860D of the Code, that holds this Note provided no Event
of Default has occurred hereunder or under any of the other Loan Documents,
Lender shall cause the release of the Security Property from the lien of
the Security Instrument and the other Loan Documents (a "DEFEASANCE") upon
the satisfaction of the following conditions:
(A) Borrower shall give not more than ninety (90) days or
less than sixty (60) days prior written notice to Lender
specifying the date Borrower intends for the Defeasance to be
consummated (the "RELEASE DATE"), which date shall be a Payment
Date.
(B) All accrued and unpaid interest and all other sums due
under this Note and under the other Loan Documents up to and
including the Release Date shall be paid in full on or prior to
the Release Date.
(C) Borrower shall deliver to Lender on or prior to the
Release Date:
(1) a sum of money in immediately available funds (the
"DEFEASANCE DEPOSIT") equal to the outstanding
principal balance of this Note plus an amount, if
any, which together with the outstanding principal
balance of this Note, shall be sufficient to
enable Lender to purchase, through means and
sources customarily employed and available to
Lender, for the account of Borrower, direct, non-
callable obligations of the United States of
America that provide for payments prior, but as
close as possible, to all successive monthly
Payment Dates occurring after the Release Date and
to the Maturity Date, with each such payment being
equal to or greater than the amount of the
corresponding installment of principal and/or
interest required to be paid under this Note
(including, but not limited to, all amounts due on
the Maturity Date) for the balance of the term
hereof ("the "DEFEASANCE COLLATERAL"), each of
which shall be duly endorsed by the holder thereof
as directed by Lender or accompanied by a written
instrument of transfer in form and substance
satisfactory to Lender in its reasonable
discretion (including, without limitation, such
instruments as may be required by the depository
institution holding such securities or the issuer
thereof, as the case may be, to effectuate book-
entry transfers and pledges through the book-entry
facilities of such institution) in order to
perfect upon the delivery of the Defeasance
Security Agreement (as hereinafter defined) the
first priority security interest in the Defeasance
Collateral in favor of Lender in conformity with
all applicable state and federal laws governing
granting of such security interests.
(2) A pledge and security agreement, in form and
substance satisfactory to Lender in its reasonable
discretion, creating a first priority security
interest in favor of Lender in the Defeasance
Collateral (the "DEFEASANCE SECURITY AGREEMENT"),
which shall provide, among other things, that any
excess received by Lender from the Defeasance
Collateral over the amounts payable by Borrower
hereunder shall be refunded to Borrower promptly
after each monthly Payment Date.
(3) A certificate of Borrower certifying that all of
the requirements set forth in this
subsection 1.05(d)(i) have been satisfied.
(4) An opinion of counsel for Borrower in form and
substance and delivered by counsel satisfactory to
Lender (subject to customary assumptions and carve
outs) in its sole discretion stating, among other
things, that (x) Lender has a perfected first
priority security interest in the Defeasance
Collateral and that the Defeasance Security
Agreement is enforceable against Borrower in
accordance with its terms, (y) that any REMIC
Trust formed pursuant to a securitization will not
fail to maintain its status as a "real estate
mortgage investment conduit" within the meaning of
Section 860D of the Code as a result of such
defeasance.
(5) Borrower shall deliver evidence in writing from the
applicable rating agencies to the effect that the
collateral substitution will not result in a
downgrading, withdrawal or qualification of the
respective ratings in effect immediately prior to
such defeasance event for any securities issued in
connection with the securitization which are then
outstanding.
(6) A certificate from a firm of independent public
accountants acceptable to Lender certifying that
the Defeasance Collateral is sufficient to satisfy
the provisions of subparagraph (1) above.
(7) Such other certificates, documents or instruments
as Lender may reasonably require.
(8) Payment of all fees, costs, expenses and charges
incurred by Xxxxxx in connection with the
Defeasance of the Security Property and the
purchase of the Defeasance Collateral, including,
without limitation, reasonable legal fees and all
costs and expenses incurred by Lender or its
agents in connection with release of the Security
Property, review of the proposed Defeasance
Collateral and preparation of the Defeasance
Security Agreement and related documentation, any
revenue, documentary, stamp, intangible or other
taxes, charges or fees due in connection with
transfer of the Note, assumption of the Note, or
substitution of collateral for the Security
Property. Without limiting Borrower's obligations
with respect thereto, Lender shall be entitled to
deduct all such fees, costs, expenses and charges
from the Defeasance Deposit to the extent of any
excess of the Defeasance Deposit.
(D) In connection with the Defeasance Deposit, Borrower
hereby authorizes and directs Lender using the means and sources
customarily employed and available to Lender to use the
Defeasance Deposit to purchase for the account of Borrower the
Defeasance Collateral. Furthermore, the Defeasance Collateral
shall be arranged such that payments received from such
Defeasance Collateral shall be paid directly to Lender to be
applied on account of the indebtedness of this Note. Any part of
the Defeasance Deposit in excess of the amount necessary to
purchase the Defeasance Collateral and to pay the other and
related costs Borrower is obligated to pay under this Section
1.05 shall be refunded to Borrower.
(ii) Upon compliance with the requirements of subsection
1.05(d)(i), the Security Property shall be released from the lien of the
Security Instrument and the other Loan Documents, and the Defeasance
Collateral shall constitute collateral which shall secure this Note and all
other obligations under the Loan Documents. Lender will, at Xxxxxxxx's
expense, execute and deliver any agreements reasonably requested by
Borrower to release the lien of the Security Instrument from the Security
Property.
(iii) Upon the release of the Security Property in accordance
with this Section 1.05(d), Borrower shall assign all its obligations and
rights under this Note, together with the pledged Defeasance Collateral, to
a newly created entity which complies with the terms of Section 1.33 of the
Security Instrument designated by Borrower and approved by Lender in its
reasonable discretion. Such successor entity shall execute an assumption
agreement in form and substance satisfactory to Lender in its reasonable
discretion pursuant to which it shall assume Borrower's obligations under
this Note and the Defeasance Security Agreement. As conditions to such
assignment and assumption, Borrower or the successor entity shall
(x) deliver to Lender an opinion of counsel in form and substance and
delivered by counsel satisfactory to Lender in its reasonable discretion
stating, among other things, that such assumption agreement is enforceable
against Borrower and such successor entity in accordance with its terms and
that this Note and the Defeasance Security Agreement as so assumed, are
enforceable against such successor entity in accordance with their
respective terms, and (y) pay all costs and expenses (including, but not
limited to, legal fees) incurred by Lender or its agents in connection with
such assignment and assumption (including, without limitation, the review
of the proposed transferee and the preparation of the assumption agreement
and related documentation). Upon such assumption, Borrower shall be
relieved of its obligations hereunder, under the other Loan Documents other
than the Hazardous Substances Indemnity Agreement (as hereinafter defined)
and under the Defeasance Security Agreement.
1.06 SECURITY. The indebtedness evidenced by this Note and the
obligations created hereby are secured by, among other things, that certain
Deed to Secure Debt and Security Agreement (the "Security Instrument") from
Borrower to Lender, dated as of the date hereof, concerning property located in
Chatham County, Georgia. The Security Instrument together with this Note and
all other documents to or of which Xxxxxx is a party or beneficiary now or
hereafter evidencing, securing, guarantying, modifying or otherwise relating to
the indebtedness evidenced hereby, are herein referred to collectively as the
"Loan Documents". All of the terms and provisions of the Loan Documents are
incorporated herein by reference.
ARTICLE 2 DEFAULT
2.01 EVENT OF DEFAULT. It is hereby expressly agreed that should any
default occur in the payment of principal or interest as stipulated above and
such payment is not made within seven (7) days of the date such payment is due
(except that no grace or notice period is provided for the payment of principal
and interest due on the Maturity Date), or should any other "Event of Default"
or any default not cured within any applicable grace or notice period occur
under any other Loan Document, then an event of default (an "Event of Default")
shall exist hereunder, and in such event the indebtedness evidenced hereby,
including all sums advanced or accrued hereunder or under any other Loan
Document, and all unpaid interest accrued thereon, shall, at the option of
Lender and without notice to Borrower, at once become due and payable and may
be collected forthwith, whether or not there has been a prior demand for
payment and regardless of the stipulated date of maturity.
2.02 LATE CHARGES AND DEFAULT INTEREST RATE. In the event that any
payment is not received by Lender on the date when due (subject to the
applicable grace period), then in addition to any default interest payments
due hereunder, Borrower shall also pay to Lender a late charge in an amount
equal to five percent (5.0%) of the amount of such overdue payment. So
long as any Event of Default exists, regardless of whether or not there has
been an acceleration of the indebtedness evidenced hereby, and at all times
after maturity of the indebtedness evidenced hereby (whether by
acceleration or otherwise), interest shall accrue on the outstanding
principal balance of this Note from the date of default at a rate per annum
equal to the lesser of (a) four percent (4.0%) in excess of the Note Rate,
or (b) the maximum rate of interest, if any, which may be charged or
collected from Borrower under applicable law (the "Default Interest Rate"),
and such default interest shall be immediately due and payable. Borrower
acknowledges that it would be extremely difficult or impracticable to
determine Xxxxxx's actual damages resulting from any late payment or
default, and such late charges and default interest are reasonable
estimates of those damages and do not constitute a penalty.
2.03 CUMULATIVE REMEDIES. The remedies of Lender in this Note or in
the Loan Documents, or at law or in equity, shall be cumulative and
concurrent, and may be pursued singly, successively or together in Xxxxxx's
discretion. In the event this Note, or any part hereof, is collected by or
through an attorney-at-law, Xxxxxxxx agrees to pay all costs of collection
including, but not limited to, reasonable attorneys' fees.
2.04 EXCULPATION. Notwithstanding anything in the Loan Documents to
the contrary, but subject to the qualifications hereinbelow set forth,
Xxxxxx agrees that:
a. Borrower shall be liable upon the indebtedness evidenced hereby and for the other obligations
arising under the Loan Documents to the full extent (but only to the extent) of the security therefor, the
same being all properties (whether real or personal), rights, estates and interests now or at any time
hereafter securing the payment of this Note and/or the other obligations of Borrower under the Loan Documents
(collectively, the "Security Property");
b. if an Event of Default occurs, any judicial or other proceedings brought by Lender against Borrower
shall be limited to the preservation, enforcement and foreclosure, or any thereof, of the liens, security
titles, estates, assignments, rights and security interests now or at any time hereafter securing the payment of
this Note and/or the other obligations of Borrower under the Loan Documents, and no attachment, execution or
other writ of process shall be sought, issued or levied upon any assets, properties or funds of Borrower other
than the Security Property, except with respect to the liability described below in this section; and
c. in the event of a foreclosure of such liens, security titles, estates, assignments, rights or
security interests securing the payment of this Note and/or the other obligations of Borrower under the Loan
Documents, no judgment for any deficiency upon the indebtedness evidenced hereby shall be sought or obtained by
Lender against Borrower, except with respect to the liability described below in this section; provided,
however, that, notwithstanding the foregoing provisions of this section, Borrower shall be fully and personally
liable and subject to legal action (i) for proceeds paid to Borrower under any insurance policies (or paid to
Borrower as a result of any other claim or cause of action against any person or entity) by reason of damage,
loss or destruction to all or any portion of the Security Property, to the full extent of such proceeds not
previously delivered by Borrower to Lender, but which, under the terms of the Loan Documents, should have been
delivered by Borrower to Lender, (ii) for proceeds or awards received by Borrower resulting from the
condemnation or other taking in lieu of condemnation of all or any portion of the Security Property, or any of
them, to the full extent of such proceeds or awards not previously delivered by Borrower to Lender, but which,
under the terms of the Loan Documents, should have been delivered to Lender by Xxxxxxxx, (iii) for all tenant
security deposits or other refundable deposits paid to or held by Borrower or on Borrower's behalf in connection
with leases of all or any portion of the Security Property which are not applied by Borrower in accordance with
the terms of the applicable lease or other agreement, (iv) for rent and other payments received by Borrower from
tenants under leases of all or any portion of the Security Property paid more than one month in advance, (v) for
rents, issues, profits and revenues of all or any portion of the Security Property received or applicable to a
period after the occurrence of any Event of Default or any event which, with notice or the passage of time, or
both, would constitute an Event of Default hereunder or under the Loan Documents which are not either applied by
Borrower or its managing agent to the ordinary and necessary expenses of owning and operating the Security
Property or paid to Lender, (vi) for waste committed on the Security Property by, or damage to the Security
Property as a result of the intentional misconduct or gross negligence of, Borrower or any of its principals,
officers, general partners or members, any guarantor, any indemnitor, or any managing agent or any removal of
the Security Property in violation of the terms of the Loan Documents, to the full extent of the losses or
damages incurred by Xxxxxx on account of such occurrence, (vii) for failure of Borrower to pay any valid taxes,
assessments, mechanic's liens, materialmen's liens or other liens which could create liens on any portion of the
Security Property which would be superior to the lien or security title of the Security Instrument or the other
Loan Documents, to the full extent of the amount claimed by any such lien claimant except, with respect to any
such taxes or assessments, to the extent that funds have been deposited with Lender pursuant to the terms of the
Security Instrument specifically for the applicable taxes or assessments and not applied by Lender to pay such
taxes and assessments, (viii) for all obligations and indemnities of Borrower under the Loan Documents relating
to hazardous or toxic subsances or radon or radon or compliance with environmental laws and regulations to the
full extent of any losses or damages (including, but not limited to, those resulting from diminution in value of
any Security Property) incurred by Lender as a result of the existence of such hazardous or toxic substances or
failure to comply with environmental laws or regulations, and (ix) for fraud or material misrepresentation or
failure of Borrower to disclose a material fact by Borrower or any of its principals, officers, general partners
or members, any guarantor, any indemnitor or any managing agent or other person authorized to make statements,
representations or disclosures on behalf of Borrower, any principal, officer, general partner or member of
Borrower, any guarantor or any indemnitor, to the full extent of any losses, damages and expenses of Lender on
account thereof. Nothing contained in this section shall (A) be deemed to be a release or impairment of the
indebtedness evidenced by this Note or the other obligations of Borrower under the Loan Documents or the lien of
the Loan Documents upon the Security Property, or (B) preclude Lender from foreclosing the Loan Documents in
case of any default or from enforcing any of the other rights of Lender except as stated in this section, or (C)
release, relieve, reduce, waive, limit or impair in any way whatsoever, any obligation of any party to the
Indemnity and Guaranty Agreement and Hazardous Substances Indemnity Agreement each of even date executed and
delivered in connection with the indebtedness evidenced by this Note.
Notwithstanding anything to the contrary in this Note, the
Security Instrument or any of the other Loan Documents, Lender shall not be
deemed to have waived any right which Lender may have under Section 506(a),
506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file
a claim for the full amount of the indebtedness evidenced hereby or secured
by the Security Instrument or any of the other Loan Documents or to require
that all collateral shall continue to secure all of the indebtedness owing
to Lender in accordance with this Note, the Security Instrument and the
other Loan Documents.
ARTICLE 3 GENERAL CONDITIONS
3.01 No Waiver: Amendment. No failure to accelerate the debt evidenced
hereby by reason of default hereunder, acceptance of a partial or past due
payment, or indulgences granted from time to time shall be construed (a) as a
novation of this Note or as a reinstatement of the indebtedness evidenced
hereby or as a waiver of such right of acceleration or of the right of Lender
thereafter to insist upon strict compliance with the terms of this Note, or (b)
to prevent the exercise of such right of acceleration or any other right
granted hereunder or by any applicable laws; and Borrower hereby expressly
waives the benefit of any statute or rule of law or equity now provided, or
which may hereafter be provided, which would produce a result contrary to or in
conflict with the foregoing. No extension of the time for the payment of this
Note or any installment due hereunder, made by agreement with any person now or
hereafter liable for the payment of this Note shall operate to release,
discharge, modify, change or affect the original liability of Borrower under
this Note, either in whole or in part unless Xxxxxx agrees otherwise in
writing. This Note may not be changed orally, but only by an agreement in
writing signed by the party against whom enforcement of any waiver, change,
modification or discharge is sought.
3.02 WAIVERS. Presentment for payment, demand, protest and notice of
demand, intent to accelerate, acceleration, protest and nonpayment and all
other notices are hereby waived by Xxxxxxxx. Borrower hereby further
waives and renounces, to the fullest extent permitted by law, all rights to
the benefits of any moratorium, reinstatement, marshalling, forbearance,
valuation, stay, extension, redemption, appraisement, exemption and
homestead now or hereafter provided by the Constitution and laws of the
United States of America and of each state thereof, both as to itself and
in and to all of its property, real and personal, against the enforcement
and collection of the obligations evidenced by this Note or the other Loan
Documents.
3.03 LIMIT OF VALIDITY. The provisions of this Note and of all
agreements between Borrower and Lender, whether now existing or hereafter
arising and whether written or oral, are hereby expressly limited so that
in no contingency or event whatsoever, whether by reason of demand or
acceleration of the maturity of this Note or otherwise, shall the amount
paid, or agreed to be paid ("Interest"), to Lender for the use, forbearance
or detention of the money loaned under this Note exceed the maximum amount
permissible under applicable law. If, from any circumstance whatsoever,
performance or fulfillment of any provision hereof or of any agreement
between Borrower and Lender shall, at the time performance or fulfillment
of such provision shall be due, exceed the limit for Interest prescribed by
law or otherwise transcend the limit of validity prescribed by applicable
law, then ipso facto the obligation to be performed or fulfilled shall be
reduced to such limit and if, from any circumstance whatsoever, Lender
shall ever receive anything of value deemed Interest by applicable law in
excess of the maximum lawful amount, an amount equal to any excessive
Interest shall be applied to the reduction of the principal balance owing
under this Note in the inverse order of its maturity (whether or not then
due) or at the option of Lender be paid over to Borrower, and not to the
payment of Interest. All Interest (including, but not limited to, any
amounts or payments deemed to be Interest) paid or agreed to be paid to
Lender shall, to the extent permitted by applicable law, be amortized,
prorated, allocated and spread throughout the full period until payment in
full of the principal balance of this Note so that the Interest thereof for
such full period will not exceed the maximum amount permitted by applicable
law. This Section 3.03 will control all agreements between Borrower and
Lender.
3.04 USE OF FUNDS. Borrower hereby warrants, represents and covenants
that no funds disbursed hereunder shall be used for personal, family or
household purposes.
3.05 UNCONDITIONAL PAYMENT. Borrower is and shall be obligated to pay
principal, interest and any and all other amounts which become payable
hereunder or under the other Loan Documents absolutely and unconditionally
and without any abatement, postponement, diminution or deduction and
without any reduction for counterclaim or setoff. In the event that at any
time any payment received by Lender hereunder shall be deemed by a court of
competent jurisdiction to have been a voidable preference or fraudulent
conveyance under any bankruptcy, insolvency or other debtor relief law,
then the obligation to make such payment shall survive any cancellation or
satisfaction of this Note or return thereof to Borrower and shall not be
discharged or satisfied with any prior payment thereof or cancellation of
this Note, but shall remain a valid and binding obligation enforceable in
accordance with the terms and provisions hereof, and such payment shall be
immediately due and payable upon demand.
3.06 SECONDARY MARKET. Lender may sell, transfer and deliver the Loan
Documents to one or more investors in the secondary mortgage market. In
connection with such sale, Lender may retain or assign responsibility for
servicing the loan evidenced by this Note or may delegate some or all of
such responsibility and/or obligations to a servicer, including, but not
limited to, any subservicer or master servicer, on behalf of the investors.
All references to Lender herein shall refer to and include, without
limitation, any such servicer, to the extent applicable.
3.07 MISCELLANEOUS. (a) This Note shall be interpreted, construed and
enforced according to the laws of the State of Georgia. The terms and
provisions hereof shall be binding upon and inure to the benefit of
Xxxxxxxx and Xxxxxx and their respective heirs, executors, legal
representatives, successors, successors-in-title and assigns, whether by
voluntary action of the parties or by operation of law. As used herein,
the terms "Borrower" and "Lender" shall be deemed to include their
respective heirs, executors, legal representatives, successors,
successors-in-title and assigns, whether by voluntary action of the parties
or by operation of law. If Borrower consists of more than one person or
entity, each shall be jointly and severally liable to perform the
obligations of Borrower under this Note. All personal pronouns used
herein, whether used in the masculine, feminine or neuter gender, shall
include all other genders; the singular shall include the plural and vice
versa. Titles of articles and sections are for convenience only and in no
way define, limit, amplify or describe the scope or intent of any
provisions hereof. Time is of the essence with respect to all provisions
of this Note. This Note and the other Loan Documents contain the entire
agreements between the parties hereto relating to the subject matter hereof
and thereof and all prior agreements relative hereto and thereto which are
not contained herein or therein are terminated.
(b) Notwithstanding anything to the contrary contained in
this Note, in the event Borrower has an obligation to pay attorneys' fees
or legal fees under this Note or any of the other Loan Documents, such
obligation shall be in an amount equal to reasonable attorneys' fees and
expenses actually incurred.
Borrower's Tax Identification No.:
00-000-0000
FUNB Loan No.: ________________
IN WITNESS WHEREOF, Xxxxxxxx has executed this Note under seal as
of the date first above written.
Signed, sealed and delivered XXXXX COVE APARTMENTS LLC
in the presence of
By: ML Apartments I, Inc.,
its managing member
_______________________________ /s/
UNOFFICIAL WITNESS By: _____________________
Name:
Title:
_______________________________
NOTARY PUBLIC
My Commission Expires:
_______________________________
[SEAL]
