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Exhibit (b)(8)
[LETTERHEAD OF GE]
Xxxxx Xxxxxxxxxxx
Xxxxx Union Real Estate Investment Trust
000 0xx Xxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Re: Proposed Loan to a to-be-formed Limited Partnership
(000 Xxxx Xxxxxxx Xxx, Xxxxxxx, XX)
Gentlemen:
General Electric Capital Corporation ("GECC" or "Lender") is interested in
pursuing the possibility of providing financing (the "Loan") secured by the
property (the "Property") described herein. This letter merely represents a
proposal of terms and conditions under which GECC may seek Credit Committee
approval. No such approval has been obtained or submitted. Even if such approval
is obtained, it may be conditioned on additional terms and conditions and/or be
substantially different from the terms and conditions discussed in this letter.
No commitment by GECC will exist unless and until a formal, written commitment
letter is issued by GECC and accepted by you. This is not a commitment or an
indication that loan approval will be forthcoming.
A. SUMMARY OF THE PROPOSED LOAN:
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Property Name: 000 Xxxx Xxxxxxx Xxx, Xxxxxxx, XX
Borrower: A to be formed Limited Partnership, with Radiant Investors
as General Partner, controlled and operated by Xx.
Xxxxxxxxxxx, Xx. Xxxxxxxx, and Xx. Xxxxxx. Borrower will be
a single purpose entity
Type: Assignment of First Mortgage/Deed of Trust
Amount: $29,000,000 (subject to GECC-audited net operating income
from the Property generating at least $3,210,000 from not
more than 90% occupancy on non-credit retail tenants, less
reserves of $0.15/SQ. FT, and a management fee equal to 1%
of gross revenues)
Term: 3 years
Contract Rate: 275 basis points in excess of the LIBOR - 1 month
Rate
Amortization: Monthly based on 25-year amortization schedule
Commitment Fee: 1.00% ($290,000)
Prepayment/
Lock-out: Loan locked-out for months 1-8; open during months 9-12 (in
whole but not in part) subject to yield maintenance plus
0.5% pre-payment fee; open during months 13-18 (in whole but
not in part) subject to 0.5% prepayment fee; open
thereafter.
Yield maintenance is defined as the prorata share of GECC's
spread above Libor for a full year, not yet collected; (i.e.
If loan paid back in month 9, GECC would be owed 4 months of
the 2.75% annual spread (0.92% - $26,583) plus the 0.5%
prepayment fee
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Exit Fee: 0.5% ($145,000)
Impounds: Monthly with GECC for real estate taxes (non-interest
bearing)
Additional
Collateral/
Reserve/Escrows: Capital Expense reserve of $0.15 par plus any immediate
repairs necessary as identified in the GECC engineering
report
Non-Recourse/
Indemnities: Non-recourse subject to standard carve-outs : Borrower,
Radiant Venture I LLC, is liable for non-recourse
carve-outs and environmental indemnity
Additional Permitted Liens: None
Closings: TBD
B. SPECIAL CONDITIONS
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1. Subject to GECC's approval of the new borrowing entity and the
ownership structure
C. MISCELLANEOUS
1. Closing Requirements: Costs:
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Actual closing requirements will be reviewed based on current documents
for the existing loan. If applicable, the Loan will be subject to
GECC's receipt review and approval of satisfactory loan documentation,
environmental and engineering reports and other customary requirements
(i.e., title insurance, legal opinions, hazard and liability insurance,
tenant estoppel certificates from major tenants, and copy of
certificate of occupancy and other evidence that the Property is in
compliance with applicable laws). Borrower will be responsible for the
costs and expenses incurred by GECC in underwriting and closing the
proposed Loan including environmental, engineering, audit, appraisal,
credit report, legal, travel, title insurance, survey, mortgage
recording tax and other out-of-pocket costs and expenses relating to
the Loan.
2. Governing Law:
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This letter shall be governed by and construed in accordance with the
laws of the State of New York.
Borrower acknowledges that GECC has not approved the Loan described in this
letter, and knowingly assumes the risk that such approval may not be obtained
and, if obtained, may be conditioned on additional terms and/or conditions.
Please contact me with any questions you may have regarding the above.
Very truly yours,
GENERAL ELECTRIC CAPITAL
CORPORATION
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Vice President
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