PROMISSORY NOTE
---------------
U.S. $10,000,000.00 September 21, 1999
FOR VALUE RECEIVED, and at the times hereinafter specified, RD VILLAGE
ASSOCIATES LIMITED PARTNERSHIP, a Delaware limited partnership ("Maker"), whose
address is 00 Xxxxxxxxx Xxxxxxxxxxx, Xxxx Xxxxxxxxxx, Xxx Xxxx 00000, hereby
promises to pay to the order of SUNAMERICA LIFE INSURANCE COMPANY, an Arizona
corporation (hereinafter referred to, together with each subsequent holder
hereof, as 'Holder"), at 0 XxxXxxxxxx Xxxxxx, Xxxxxxx Xxxx, Xxx Xxxxxxx,
Xxxxxxxxxx 00000-0000, or at such other address as may be designated from time
to time hereafter by any Holder, the principal sum of TEN MILLION AND NO/100THS
DOLLARS ($10,000,000-00), together with interest on the principal balance
outstanding from time to time, as hereinafter provided, in lawful money of the
United States of America.
By its execution and delivery of this promissory note (this "Note"),
Maker covenants and agrees as follows:
RECITALS
A. Maker executed a Promissory Note (the "Original Note") dated June
24, 1992, in the original principal amount of U.S. $7,500,000 made payable to
the order of Sun Life Insurance Company of America, an Arizona corporation
(n/k/a Sun America Life Insurance Company.
B. The entire $7,500,000.00 amount of the original loan evidenced by
the Note has been disbursed to Maker and Maker acknowledges receipts of the
entire original loan.
C. On or about November 15, 1993, Holder advanced to Maker an
additional$450,000.00 (the "First Additional Advance"), and as of that date,
Maker and Holder executed an Amendment to the Promissory Note (The "First
Amendment to Note"). Maker acknowledges receipt of the First Additional Advance.
D. On or about December 23, 1996, Xxxxxx advanced to Maker a second
additional advance in the amount of $1,500,000.00 (the "Second Additional
Advance), and as of that date Maker and Holder executed an Amendment to the
Promissory Note (the "Second Amendment to Note"). Maker acknowledges receipt of
the Second Additional Advance.
E. On or about May 8, 1998, Maker and Xxxxxx executed a Third Amendment
to Promissory Note (the Third Amendment to Promissory Note").
F. The Original Note, as modified by the First Amendment to Note, the
Second Amendment to Note and the Third Amendment to Note is here collectively
@red to as the "Prior Note".
G. The total amount outstanding under the Prior Note as of the date
hereof is $8,554,899.55.
H. The proceeds of this Note shall be disbursed by application of
$8,554,899.55 towards retirement of The Prior Note (such amount sufficient to
fully retire The Prior Note) and $1,445,100.45 advanced to Maker at closing.
Maker acknowledges that the difference between the principal face amount of this
Note and the amount of funds advanced to Maker hereunder equals the amount
applied towards retirement of the Prior Note.
AGREEMENT
1. Definitions. For purposes of this Note, -the following terms
shall have the meanings ascribed to them below. Capitalized terms used herein
and not otherwise defined shall have the meanings set forth in the Deed of Trust
(hereinafter defined).
(a) Business Day" shall have the meaning ascribed to it in
Section 8 of this Note.
(b) "Conversion Date" shall mean the first day of the month
following the date on which the LIBOR Rate is converted to the
Remaining Term Fixed Rate pursuant to Section 3 of this Note.
(c) "Effective Rate" shall mean:
(i) for the period commencing on the date hereof through and
including September 30, 1999 seven and fifty-seven hundredths
percent (7.57)% per annum;
(ii) for the period commencing on October 1, 1999, and
continuing through the day immediately preceding the Conversion
Date, if any, or if the Conversion Date does not occur, through the
Original Maturity Date, the LIBOR Rate; and
(iii) for the period Commencing on the Conversion Date, if
any, and continuing through -the Original Maturity Date, The
Remaining Term Fixed Rate.
(d) "LIBOR Determination Date" shall mean September 29, 1999, and
each succeeding date that is two (2) Business Days prior to the
commencement date of a LIBOR Period.
(e) "LIBOR Index '% shall mean the rate per annum for United
States dollar deposits quoted as the London Inter-Bank Offered Rate
("LIBOR") as reported by Bloomberg on the LIBOR Determination Date for
delivery of funds on such LIBOR Determination Date for a period
comparable to the LIBOR Period and in an amount approximately equal to
the principal amount of this Note outstanding on such date.
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(f) "LIBOR Period" shall mean the three-month period commencing
on October 1, 1999 ("the LIBOR Period Commencement Date"), and each
succeeding three-month period, and commencing on the first day of
January, April, July and October.
(g) "LIBOR Rate" shall mean a rate per annum equal to the sum of
the LIBOR Index plus the Margin.
(h) "Margin" shall mean two and five-hundredths percent (2.05%)
per annum.
(i) "Original Maturity Date" shall mean October 1, 2002.
(j) "Principal and Interest Calculation" shall mean the
recalculation of combined payments of principal and interest on each
LIBOR Determination Date, based on the amount of principal balance
outstanding, on such LIBOR Determination Date, which shall bear
interest at the LIBOR Rate, as determined for such LIBOR Period, and
re-amortized for each LIBOR Period based on the Original Amortization
Period minus the number of months actually elapsed from the LIBOR
Period Commencement Date.
(k) "Remaining Term Fixed Rate" shall mean a rate per annum equal
to the sum of the Remaining Term Index plus the Margin.
(1) "Remaining Term Index" shall mean the yield on the U.S.
Treasury Constant Maturity Series maturing on the Original Maturity
Date, for the week prior to the Conversion Date, as reported in Federal
Reserve Statistical Release H.15 Selected Interest Rates, conclusively
determined by Holder on the Conversion Date.
2. Interest Rate and Payments.
(a) The balance of principal outstanding from time to time under
this Note shall bear interest at a rate per annum, based on actual days in the
year divided by a three hundred sixty (360) day year composed of twelve (12)
months of thirty (30) days each, equal to the Effective Rate in effect from time
to time.
(b) Interest only on the outstanding principal balance of this Note
shall be payable on the date hereof, in advance, for the period from and
including the date hereof through and including September 30, 1999.
(c) Commencing on November 1, 1999, and on the first day of each
month thereafter through and including September 1, 2002, combined payments of
principal and interest shall be payable, in arrears, in an amount sufficient to
fully amortize the original principal amount of this Note over a three hundred
month amortization period (the "Original Amortization Period").
(d) For periods during which the LIBOR Rate shall be in effect, the
amount of the combined monthly payments of principal and interest shall be
recalculated based on the Principal and Interest Calculation, as of the
beginning of each LIBOR Period, and the LIBOR Rate shall be consecutively
redetermined and established as of the applicable LIBOR Determination Date,
effective as
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of the first day of the next succeeding calendar month, which shall be deemed to
be the first day of the next succeeding LIBOR Period.
(e) The entire outstanding principal balance, together with all
accrued and unpaid interest and all other stuns due hereunder, shall be due and
payable in full on October 1, 2002 (the "Original Maturity Date").
3. Additional LIBOR Provisions.
(a) If Holder at any time shall determine that for any reason
adequate and reasonable means do not exist for ascertaining the LIBOR Rate, then
Holder shall promptly give notice thereof to Maker. If such notice is given and
until such notice has been withdrawn by Holder, then (i) no new LIBOR Rate shall
be set by Holder, and (ii) any portion of the outstanding principal balance
hereof which bears interest at the LIBOR Rate, subsequent to the end of the
LIBOR period applicable thereto, shall bear interest at the Remaining Term Fixed
Rate.
(b) If any law, treaty, rule, regulation or determination of a court
or governmental authority or any change therein or in the interpretation or
application thereof (each, a "Change in LANW') shall make it unlawful for Holder
(i) to make LIBOR based interest rate options available hereunder, or (ii) to
maintain interest rates based on LIBOR, then in the former event, any obligation
of Holder to make available such unlawful LIBOR-based interest rate shall
immediately be cancelled, and in the latter event, any such unlawful LIBOR-based
interest rates then outstanding shall be converted to the Remaining Term Fixed
Rate; provided, however, that if any such change in law shall permit any
LIBOR-based interest rates to remain in effect until the expiration of the term
thereof applicable thereto, then such permitted LIBOR-based interest rates shall
continue in effect until the expiration of such term. Upon the occurrence of any
of the foregoing events, Maker shall pay to Holder immediately upon demand such
amounts as may be necessary to compensate Holder for any fines, fees, charges,
penalties or other costs incurred or payable by Holder as a result thereof and
which are attributable to any LIBOR-based interest rate made available to Maker
hereunder, and any reasonable allocation made by Holder among its operations
shall be conclusive and binding upon Maker.
(c) If any Change in Law or compliance by Holder with any request or
directive (whether or not having the force of law) from any central bank or
other governmental authority shall:
(i) subject Holder to any tax, duty or other charge with respect
to any LIBOR-based interest rate, or change the basis of taxation of
payments to Holder of principal, interest, fees or any other amount
payable hereunder (except for changes in the rate of tax on the
overall net income of Holder); or
(ii) impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held
by, deposits or other liabilities in or for the account of, advances
or loans by, or any other acquisition of funds by any office of
Holder; or
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(iii) impose on Holder any other condition;
and the result of any of the foregoing is to increase the cost to Holder of
making, renewing or maintaining any LIBOR-based interest rate hereunder and/or
to reduce any amount receivable by Holder in connection therewith, then in any
such case, Maker shall pay to Holder immediately upon demand such amounts as may
be necessary to compensate Holder for any additional costs incurred by Holder
and/or reductions in amounts received by Holder which are attributable to such
LIBOR-based interest rate. In determining which costs incurred by Holder and/or
reductions in amounts received by Holder are attributable to any LIBOR-based
interest rate made available to Maker hereunder, any reasonable allocation made
by Holder among its operations shall be conclusive and binding upon Maker.
4. Holder's Extension Option-, Net Operating Income.
(a) If Maker shall fail to pay the outstanding principal balance of
this Note and all accrued interest and other charges due hereon at the Original
Maturity Date, Holder shall have the right, at Holder's sole option and
discretion, to extend the term of the loan evidenced by this Note (the "Loan")
for an additional period of five (5) years (the "Extension Term"). If Holder
elects to extend the term of the Loan, Maker shall pay all fees of Holder
incurred in connection with such extension, including, but not limited to,
attorneys' fees and title insurance premiums. Maker shall execute all documents
reasonably requested by Xxxxxx to evidence and secure the Loan, as extended, and
shall obtain and provide to Holder any title insurance policy or endorsement
requested by Xxxxxx.
(b) Should Holder elect to extend the term of the Loan as provided
above, Holder shall (i) reset the interest rate borne by the then-existing
principal balance 'of the Loan to a rate per annum (the "New Rate") equal to
Holder's (or comparable lenders', if Holder is no longer making such loans)
then-prevailing interest rate for five (5) year loans secured by properties
similar to the Property (hereinafter defined), as determined by Holder in its
sole discretion; (ii) re-amortize the then-existing principal balance of the
Loan over the remaining portion of the Amortization Period (the "New
Amortization Period"); (iii) have the right to require Maker to enter into
modifications of the non-economic terms of the Loan Documents as Holder may
request (the "Non-Economic Modifications"); and (iv) notwithstanding any
provision set forth in the Loan Documents to the contrary, have the right to
require Maker to make monthly payments into escrow for insurance premiums and
real property taxes, assessments and similar governmental charges. Hence,
monthly principal and interest payments during the Extension Term shall be based
upon the New Rate, and calculated to amortize fully the outstanding principal
balance of the Loan over the New Amortization Period.
(c) If Holder elects to extend the term of the Loan, Holder shall
advise Maker of the New Rate on or prior to the Original Maturity Date.
(d) In addition to the required monthly payments of principal and
interest set forth above, commencing on the first day of the second month
following the Original
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Maturity Date and continuing on the first day of each month thereafter during
the Extension Term (each an "Additional Payment Date"), Maker shall make monthly
payments to Holder in an amount equal to all Net Operating Income (hereinafter
defined) attributable to the Property for the calendar month ending on the last
day of the month that is two months preceding each such Additional Payment Date.
For example, assuming the Original Maturity Date is January 1, then Net
Operating Income for the period from January I through January 31 shall be
payable to Holder on March 1; Net Operating Income for the period from February
I through February 28 shall be payable to Holder on April 1, and so on.
(e) Holder shall deposit all such Net Operating Income received from
Maker into an account or accounts maintained at a financial institution chosen
by Holder or its servicer in its sole discretion (the "Deposit Account") and all
such funds shall be invested in a manner acceptable to Holder in its sole
discretion. All interest, dividends and earnings credited to the Deposit Account
shall be held and applied in accordance with the terms hereof.
(f) On the third Additional Payment Date and on each third
Additional Payment Date thereafter, Holder shall apply all Excess Funds
(hereinafter defined), if any, to prepayment of amounts due under this Note,
without premium or penalty.
(g) As security for the repayment of the Loan and the performance of
all other obligations of Maker under the Loan Documents, Maker hereby assigns,
pledges, conveys, delivers, transfers and grants to Holder a first priority
security interest in and to: all Maker's right, title and interest in and to the
Deposit Account; all rights to payment from the Deposit Account and the money
deposited therein or credited thereto (whether then due or in the future due and
whether then or in the future on deposit); all interest thereon; any
certificates, instruments and securities, if any, representing the Deposit
Account; all claims, demands, general intangibles, chooses in action and other
rights or interests of Maker in respect of the Deposit Account; any monies then
or at any time thereafter deposited therein; any increases, renewals,
extensions, substitutions and replacements thereof-, and all proceeds of the
foregoing.
(h) From time to time, but not more frequently than monthly, Maker
may request a disbursement (a "Disbursement") from the Deposit Account for
capital expenses, tenant improvement expenses, leasing commissions and special
contingency expenses. Holder may consent to or deny any such Disbursement in its
sole discretion.
(i) Upon the occurrence of any Event of Default (hereinafter
defined) (i) Maker shall not be entitled to any further Disbursement from the
Deposit Account; and (ii) Holder shall be entitled to take immediate possession
and control of the Deposit Account (and all funds contained therein) and to
pursue all of its rights and remedies available to Holder under the Loan
Documents, at law and in equity.
(j) All of the terms and conditions of the Loan shall apply during
the Extension Term, except as expressly set forth above, and except that no
further extensions of the Loan shall be permitted.
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(k) For the purposes of the foregoing:
(i) "Excess Funds" shall mean, on any Additional Payment Date,
the amount of funds then existing in the Deposit Account (including
any Net Operating Income due on the applicable Additional Payment
Date), less an amount equal to the sum of three regularly scheduled
payments of principal and interest due on this Note;
(ii) "Net Operating Income" shall mean, for any particular
period of time, Gross Revenue for the relevant period, less
Operating Expenses for the relevant period; provided, however, that
if such amount is equal to or less than zero (0), Net Operating
Income shall equal zero (0);
(iii) "Gross Revenue" shall mean all payments and other revenues
(exclusive, however, of any payments attributable to sales taxes)
received by or on behalf of Maker from all sources related to the
ownership or operation of the Property, including, but not limited
to, rents, room charges, parking fees, interest, security deposits
(unless required to be held in a segregated account), business
interruption insurance proceeds, operating expense passthrough
revenues and common area maintenance charges, for the relevant
period for which the calculation of Gross Revenue is being made; and
(iv) "Operating Expenses" shall mean the sum of all ordinary and
` necessary operating expenses actually paid by Maker in connection
with the operation of the Property during the relevant period for
which the calculation of Operating is being made, Including, but not
limited to (a) payments made by Maker for taxes and insurance
required under the Loan Documents, and (b) monthly debt service
payments as required under this Note.
5. Budgets During Extension Term.
(a) Within fifteen (15) days following the Original Maturity Date
and on or before December I of each subsequent calendar year, Maker shall
deliver to Holder a proposed revenue and expense budget for the Property for the
remainder of the calendar year in which the Original Maturity Date occurs or the
immediately succeeding calendar year (as applicable). Such budget shall set
forth Maker's projection of Gross Revenue and Operating Expenses for the
applicable calendar year, which shall be subject to Holder's reasonable
approval. Once a proposed budget has been reviewed and approved by Xxxxxx, and
Maker has made all revisions requested by Xxxxxx, if any, the revised budget
shall be delivered to Holder and shall thereafter become the budget for the
Property hereunder (the "Budget") for the applicable calendar year. If Maker and
Holder are unable to agree upon a Budget for any calendar year, the budgeted
Operating Expenses (excluding extraordinary items) provided in the Budget for
the Property for the preceding calendar year shall be considered the Budget for
the Property for the subject calendar year until Maker and Holder agree upon a
new Budget for such calendar year.
(b) During the Extension Term, Maker shall operate the Property in
accordance with the Budget for the applicable calendar year, and the total of
expenditures relating to the Property exceeding one hundred and five percent
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(105%) of the aggregate of such expenses set forth in the Budget for the
applicable time period shall not be treated as Operating Expenses for the
purposes of calculating "Net Operating Income," without the prior written
consent of Xxxxxx except for emergency expenditures which, in the Maker's good
faith judgment, are reasonably necessary to protect, or avoid immediate danger
to, life or property.
6. Reports During Extension Term.
(a) During the Extension Term, Maker shall deliver to Holder all
financial statements reasonably required by Xxxxxx to calculate Net Operating
Income, including, without limitation, a monthly statement to be delivered to
Holder concurrently with Maker's payment of Net Operating Income that sets forth
the amount of Net Operating Income accompanying such statement and Maker's
calculation of Net Operating Income for the relevant calendar month. Such
statements shall be certified by an executive officer of Maker or Maker's
manager, managing member or general partner (as applicable) as having been
prepared in accordance with the terms hereof and to be true, accurate @d
complete in all material respects.
(b) In addition, on or before February 1 of each calendar year
during the Extension Term, Maker shall submit to Holder an annual income and
expense statement for the Property which shall include the calculation of Gross
Revenue, Operating Expenses and Net Operating Income for the preceding calendar
year and shall be accompanied by Maker's reconciliation of any difference
between the actual aggregate amount of the Net Operating Income for such
calendar year and the aggregate amount of Net Operating Income for such calendar
year actually remitted to Holder. All such statements shall be certified by an
executive officer of Maker or Maker's manager, managing member or general
partner (as applicable) as having been prepared in accordance with the terms
hereof and to be true, accurate and complete in all material respects. If any
such annual financial statement discloses any inconsistency between the
calculation of Net Operating Income and the amount of Net Operating Income
actually remitted to Holder, Maker shall immediately remit to Holder the amount
of any underpayment of Net Operating Income for such calendar year or, in the
event of an overpayment by Maker, such amount may be withheld from any
subsequent payment of Net Operating Income required hereunder.
(c) Holder may notify Maker within ninety (90) days after receipt of
any statement or report required hereunder that Holder disputes any computation
or item contained in any portion of such statement or report. If Holder so
notifies Maker, Xxxxxx and Maker shall meet in good faith within twenty (20)
days after Xxxxxx's notice to Maker to resolve such disputed items. If, despite
such good faith efforts, the parties are unable to resolve the dispute at such
meeting or within ten (10) days thereafter, the items shall be resolved by an
independent certified public accountant designated by Holder within fifteen (I
5) days after such ten (10) day period. The determination of such accountant
shall be final. All fees of such accountant shall be paid by Maker. Maker shall
remit to Holder any additional amount of Net Operating Income found to be due
for such periods within ten (10) days after the resolution of such dispute by
the parties or the accountant's determination, as applicable. The amount of any
overpayment found to have been made for such periods may be withheld from any
required future remittance of Net Operating Income.
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(d) Maker shall at all times keep and maintain full and accurate
books of account and records adequate to reflect correctly all items required in
order to calculate Net Operating Income.
7. Prepayment.
(a) During the first (1st) year after the date of this Note, Maker
shall have no right to prepay all or any part of this Note.
(b) At any time after the first (1st) anniversary of the date of
this Note, Maker shall have the right to prepay the principal amount of this
Note, in whole or in part, and all accrued but unpaid interest hereon as of the
date of prepayment, provided that (i) Maker gives not less than @ (30) days'
prior written notice to Holder of Maker's election to prepay this Note, and (ii)
Maker pays a prepayment premium to Holder equal to one-half percent (1/2%) of
the principal amount of this Note being prepaid, calculated as of the prepayment
date.
(c) Holder shall notify Maker of the amount and basis of
determination of the prepayment premium. Holder shall not be obligated to accept
any prepayment of the principal balance of this Note unless such prepayment is
accompanied by the applicable prepayment premium and all accrued interest and
other sums due under this Note.
(d) If Holder accelerates this Note for any reason, then in addition
to Maker's obligation to pay the then outstanding principal balance of this Note
and all accrued but unpaid interest thereon, Maker shall pay an additional
amount equal to the prepayment premium that would be due to Holder if Maker were
voluntarily prepaying this Note at the time that such acceleration occurred, or
if under the terms hereof no voluntary prepayment would be permissible on the
date of such acceleration, Maker shall pay a prepayment premium calculated as
set forth in the Deed of Trust.
(e) Notwithstanding the foregoing, (i) at any time during the
Extension Term, Maker shall have the right to prepay the full principal amount
of this Note and all accrued but unpaid interest thereon as of the date of
prepayment, without prepayment premium thereon, and (ii) no prepayment premium
shall be due in connection with the application of any insurance proceeds or
condemnation awards to the principal balance of this Note, as provided in the
Deed of Trust.
8. Dates of Payments. Whenever any payment to be made under this Note
shall be stated to be due on a Saturday, Sunday or public holiday or the
equivalent for banks generally under the laws of the State of North Carolina
(any other day being a "Business Day"), such payment may be made on the next
succeeding Business Day.
9. Default Rate.
(a) The entire balance of principal, interest, and other sums due
upon the maturity hereof, by acceleration or otherwise, shall bear interest from
the date due until paid at the greater of (i) fifteen percent (I 5%) per annum
and (ii) a per annum rate equal to five percent (5%) over the prime rate (for
corporate loans at large United States money center commercial banks) published
in The Wall Street Journal on the first business day of each month (the "Default
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Rate") provided, however, that such rate shall not exceed the maximum permitted
by applicable state or federal law. In the event The Wall Street Journal is no
longer published or no longer publishes such prime rate, Holder shall select a
comparable reference.
(b) If any payment under this Note is not made when due, interest
shall accrue at the Default Rate from the date such payment was due until
payment is actually made.
10. Late Charges. In addition to interest as set forth herein, Maker
shall pay to Holder a late charge equal to four percent (4%) of any amounts due
under this Note in the event any such amount is not paid within fifteen (1 5)
days of the date when due.
11. Application of Payments. All payments hereunder shall be applied
first to the payment of late charges, if any, then to the payment of prepayment
premiums, if any, then to the repayment of any sums advanced by Holder for the,
payment of any insurance premiums, taxes, assessments, or other charges against
the property securing this Note (together with interest thereon at the Default
Rate from the date of advance until repaid), then to the payment of accrued and
unpaid interest, and then to the reduction of principal.
12. Immediately Available Funds. Payments under this Note shall be
payable in immediately available funds without setoff, counterclaim or deduction
of any kind, and shall be made by electronic funds transfer from a bank account
established and maintained by Maker for such purpose.
13. Security. This Note is secured by a Deed of Trust, Security
Agreement, Fixture Filing, Financing Statement and Assignment of Leases and
Rents of even date herewith granted by Maker for the benefit of the named Holder
hereof (the "Deed of Trust") encumbering certain real property and improvements
thereon commonly known as The Village Apartments as more particularly described
in such Deed of Trust (the "Property").
14. Certain Definitions. Capitalized terms used herein and not
otherwise defined shall have the meanings set forth in the Deed of Trust.
15. Event of Default. Each of the following events will constitute an
event of default (an "Event of Default") under this Note and under the Deed of
Trust and each other Loan Document, and any Event of Default under any Loan
Document shall constitute an Event of Default hereunder and under each of the
other Loan Documents:
(a) any failure to pay within five (5) days of the date when due
any sum hereunder;
(b) any failure of Maker to properly perform any obligation
contained herein or in any of the other Loan Documents (other than the
obligation to make payments under this Note or the other Loan Documents) and the
continuance of such failure for a period of thirty (30) days following written
notice thereof from Holder to Maker; provided, however, that if such failure is
not curable within such thirty (30) day period, then, so long as Maker commences
to cure such failure within such thirty (30) day period and is continually and
diligently attempting to cure to completion, such failure shall not be an Event
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of Default unless such failure remains uncured for sixty (60) days after such
written notice to Maker; or
(c) if, at any time during the Extension Term, Gross Revenue for
any calendar month shall be less than ninety-three percent (93%) of the amount
of projected Gross Revenue for such month set forth in the applicable Budget.
16. Acceleration. Upon the occurrence of any Event of Default, the
entire balance of principal, accrued interest, and other sums owing hereunder
shall, at the option of Holder, become at once due and payable without notice or
demand. Upon the occurrence of an Event of Default described in Section 15(c)
hereof, Holder shall have the option, in its sole discretion, to either (a)
exercise any remedies available to it under the Loan Documents, at law or in
equity, or (b) require Maker to submit a new proposed budget for Holder's
approval. If Xxxxxx agrees to accept such new proposed budget, then, such budget
shall become the Budget for all purposes hereunder.
17. Conditions Precedent. Maker hereby certifies and declares that all
acts, conditions and things required to be done and performed and to have
happened precedent to the creation and issuance of this Note, and to constitute
this Note the legal, valid and binding obligation of Maker, enforceable in
accordance with the terms hereof, have been done and performed and happened in
due and strict compliance with all applicable laws.
18. Certain Waivers and Consents. Maker and all parties now or
hereafter liable for the payment hereof, primarily or secondarily, directly or
indirectly, and whether as endorser, guarantor, surety, or otherwise, hereby
severally (a) waive presentment, demand, protest, notice of protest and/or
dishonor, and all other demands or notices of any sort whatever with respect to
this Note, (b) consent to impairment or release of collateral, extensions of
time for payment, and acceptance of partial payments before, at, or after
maturity, (c) waive any right to require Holder to proceed against any security
for this Note before proceeding hereunder, (d) waive diligence in the collection
of this Note or in filing suit on this Note, and (e) agree to pay all costs and
expenses, including reasonable attorneys' fees, which may be incurred in the
collection of this Note or any part thereof or in preserving, securing
possession of, and realizing upon any security for this Note.
19. Usury Savings Clause. The provisions of this Note and of all
agreements between Maker and Holder are, whether now existing or hereinafter
made, hereby expressly limited so that in no contingency or event whatever,
whether by reason of acceleration of the maturity hereof, prepayment, demand for
payment or otherwise, shall the amount paid, or agreed to be paid, to Holder for
the use, forbearance, or detention of the principal hereof or interest hereon,
which remains unpaid from time to time, exceed the maximum amount permissible
under applicable law, it particularly being the intention of the parties hereto
to conform strictly to North Carolina and Federal law, whichever is applicable.
If from any circumstance whatever, the performance or fulfillment of any
provision hereof or of any other agreement between Maker and Holder shall, at
the time performance or fulfillment of such provision is due, involve or purport
to require any payment in excess of the limits prescribed by law, then the
obligation to be performed or fulfilled is hereby reduced to the limit of such
validity, and if from any circumstance whatever Holder should ever receive as
interest an amount which would exceed the highest lawful rate, the amount which
would be excessive interest shall be applied to the
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reduction of the principal balance owing hereunder (or, at Holder's option, be
paid over to Maker) and shall not be counted as interest. To the extent
permitted by applicable law, determination of the legal maximum amount of
interest shall at all times be made by amortizing, prorating, allocating and
spreading in equal parts during the period of the full stated term of this Note,
all interest at any time contracted for, charged, or received from Maker in
connection with this Note and all other agreements between Maker and Holder, so
that the actual rate of interest on account of the indebtedness represented by
this Note is uniform throughout the term hereof.
20. Non-Recourse, Exceptions to Non-Recourse. Except as expressly
hereinafter set forth, the recourse of Holder with respect to the obligations
evidenced by this Note shall be solely to the Property, Chattels, and Intangible
Personalty (as such terms are defined in the Deed of Trust). Notwithstanding
anything to the contrary contained in this Note or in any Loan Document, nothing
shall be deemed in any way to impair, limit or prejudice the rights of Holder
(a) in foreclosure proceedings or in any ancillary proceedings brought to
facilitate Holder's foreclosure on the Property or any portion thereof, (b) to
recover from Maker damages or costs (including without limitation reasonable
attorneys' fees) incurred by Holder as a result of waste by Maker; (c) to
recover from Maker any condemnation or insurance proceeds attributable to the
Property which were not paid to Holder or used to restore the Property in
accordance with the terms of the Deed of Trust; (d) to recover from Maker any
rents, profits, security deposits, advances, rebates, prepaid rents or other
similar sums attributable to the Property collected by or for Maker following an
Event of Default under any Loan Document and not properly applied to the
reasonable fixed and operating expenses of the Property, including payments of
this Note; (e) to pursue the personal liability of Maker under the provisions of
Section 5.10 of the Deed of Trust, including any indemnification provisions
under such Section; (f) to exercise any specific rights or remedies afforded
Holder under any other provisions of the Loan Documents or by law or in equity
(or to recover under any guarantee agreement given in connection with this
Note); (g) to recover from Maker the amount of any accrued taxes, assessments,
and/or utility charges affecting the Property (whether or not the same have been
billed to Maker) that are either unpaid by Maker or paid by Holder under the
Deed of Trust and to collect from Maker any sums expended by Holder in
fulfilling the obligations of Maker, as lessor, under any leases affecting the
Property; (h) to pursue any personal liability of Maker and/or Guarantor under
the Environmental Indemnity Agreement; and (I) to recover from Maker the amount
of any loss suffered by Xxxxxx (that would otherwise be covered by insurance) as
a result of Maker's failure to maintain any insurance required under the terms
of any Loan Document. The agreement contained in this paragraph to limit the
personal liability of Maker shall become null and void and be of no further
force and effect in the event (i) that the Property or any part thereof or any
interest therein, or any interest in Maker, shall be further encumbered by a
voluntary lien securing any obligation upon which Maker or any general partner,
principal or affiliate of Maker shall be personally liable for repayment,
whether as obligor or guarantor; (ii) of any breach or violation of Section 5.4,
5.5 or 5.7 of the Deed of Trust; (iii) of any fraud or misrepresentation by
Maker in connection with the Property, the Loan Documents or the application
made by Maker for the Loan; or (iv) of any execution, amendment, modification or
termination of any lease of any portion of the Property without the prior
written consent of Holder if such consent is required under the terms of the
Loan Documents. For purposes of the foregoing, "affiliate" shall mean any
individual, corporation, trust, partnership or any other person or entity
controlled by, controlling or under common control with Maker. A person or
entity of any nature shall be presumed to
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have control when it possesses the power, directly or indirectly, to direct, or
cause the direction of, the management or policies of another person or entity,
whether through ownership of voting securities, by contract, or otherwise.
21. Severabilily. If any provision hereof or of any other document
securing or related to the indebtedness evidenced hereby is, for any reason and
to any extent, invalid or unenforceable, then neither the remainder of the
document in which such provision is contained, nor the application of the
provision to other persons, entities, or circumstances, nor any other document
referred to herein, shall be affected thereby, but instead shall be enforceable
to the maximum extent permitted by law.
22. Transfer of Note. Each provision of this Note shall be and remain
in full force and effect notwithstanding any negotiation or transfer hereof and
any interest herein to any other Holder or participant.
23. Governing Law. Regardless of the place of its execution, this Note
shall be construed and enforced in accordance with the laws of the State of
North Carolina.
24. Time of Essence. Time is of the essence of this Note.
25. Remedies Cumulative. The remedies provided to Holder in this Note,
the Deed of Trust and the other Loan Documents are cumulative and concurrent and
may be exercised singly, successively or together against Maker, the Property,
and other security, or any guarantor of this Note, at the sole and absolute
discretion of the Holder.
26. No Waiver. Holder shall not by any act or omission be deemed to
waive any of its rights or remedies hereunder unless such waiver is in writing
and signed by the Holder and then only to the extent specifically set forth
therein. A waiver of one event shall not be construed as continuing or as a bar
to or waiver of any right or remedy granted to Holder hereunder in connection
with a subsequent event.
27. Joint and Several Obligation. If Maker is more than one person or
entity, then (a) all persons or entities comprising Maker are jointly and
severally liable for all of the Maker's obligations hereunder; (b) all
representations, warranties, and covenants made by Maker shall be deemed
representations, warranties, and covenants of each of the persons or entities
comprising Maker; (c) any breach, Default or Event of Default by any of the
persons or entities comprising Maker hereunder shall be deemed to be a breach,
Default, or Event of Default of Maker; and (d) any reference herein contained to
the knowledge or awareness of Maker shall mean the knowledge or awareness of any
of the persons or entities comprising Maker.
28. WAIVER OF JURY TRIAL. MAKER AND HOLDER KNOWINGLY, IRREVOCABLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT EITHER MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY ACTION, PROCEEDING OR COUNTERCLAIM BASED ON THIS NOTE, OR
ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE, THE DEED OF TRUST, OR ANY
OTHER LOAN DOCUMENTS OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENT
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY HERETO OR TO ANY LOAN
DOCUMENT. THIS PROVISION IS A MATERIAL INDUCEMENT FOR MAKER AND HOLDER TO ENTER
INTO THE LOAN TRANSACTION EVIDENCED BY THIS NOTE.
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29. WAIVER OF PREPAYMENT RIGHT WITHOUT PREMIUM MAKER HEREBY EXPRESSLY
WAIVES ANY RIGHT IT MAY HAVE UNDER APPLICABLE LAW TO PREPAY THIS NOTE, IN WHOLE
OR IN PART, WITHOUT PREPAYMENT PRENUUM, UPON ACCELERATION OF THE MATURITY DATE
OF THIS NOTE, AND AGREES THAT, IF FOR ANY REASON A PREPAYMENT OF ALL OR ANY PART
OF THIS NOTE IS MADE, WHETHER VOLUNTARILY OR FOLLOWING ANY ACCELERATION OF THE
MATURITY DATE OF THIS NOTE BY HOLDER ON ACCOUNT OF THE OCCURRENCE OF ANY EVENT
OF DEFAULT ARISING FOR ANY REASON, INCLUDING, WITHOUT LIMITATION, AS A RESULT OF
ANY PROHIBITED OR RESTRICTED TRANSFER, FURTHER ENCUMBRANCE OR DISPOSITION OF THE
PROPERTY OR ANY PART THEREOF SECURING THIS NOTE, THEN MAKER SHALL BE OBLIGATED
TO PAY, CONCURRENTLY WITH SUCH PREPAYMENT, THE PREPAYMENT PREMIUM PROVIDED FOR
IN THIS NOTE OR, IN THE EVENT OF PREPAYMENT FOLLOWING ACCELERATION OF THE
MATURITY DATE HEREOF WHEN THIS NOTE IS CLOSED TO PREPAYMENT, AS PROVIDED IN THE
DEED OF TRUST. MAKER XXXXXX DECLARES THAT HOLDER'S AGREEMENT TO MAKE THE LOAN AT
THE INTEREST RATE AND FOR THE TERM SET FORTH IN THIS NOTE CONSTITUTES ADEQUATE
CONSIDERATION, GIVEN INDIVIDUAL WEIGHT BY MAKER, FOR THIS WAIVER AND AGREEMENT.
IN WITNESS WHEREOF and intending to be legally bound, Maker has duly
executed this Note as of the date first above written.
RD VILLAGE ASSOCIATES LIMITED
PARTNERSHIP, a Delaware limited partnership
By: ACADIA PROPERTY HOLDINGS, LLC, a Delaware
limited liability company, its General Partner
By: ACADIA REALTY LIMITED PARTNERSHIP, a
Delaware limited partnership, its sole member
By: ACADIA REALTY TRUST, a Maryland real
estate investment trust, its General Partner
By:_____________________
Xxxxxxx X. Xxxxxxxxx,
President
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