CERTIFIED TO BE A TRUE COPY
MORTGAGE NOTE /s/
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Roseland, New Jersey
$1,200,000.00 June 8, 2000
BORROWER: INTEGRATED ANALYTICAL REALTY, L.L.C., a New Jersey limited
liability company having a business address at:
Address: 000 Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx: Xxxxxxxx
Xxxxx: Xxx Xxxxxx
Zip: 07869
(from now on called "Borrower" or "Borrowers") is borrowing money from
LENDER: NORCROWN BANK, a state chartered bank
Address: 00 Xxxx Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx: Xxxxxxxxxx
Xxxxx: Xxx Xxxxxx
Zip: 07039
(from now on called "Lender")
The Lender and any other holder of this note may transfer this Note.
The word Lender includes the original Lender and anyone who takes this
Note by transfer.
1. XXXXXXXX'S PROMISE TO PAY:
In return for this loan (the "Loan"), the Borrower promises to pay to
the order of Lender the principal sum of ONE MILLION TWO HUNDRED
THOUSAND AND 00/100 ($1,200,000.00) DOLLARS, together with interest on
the unpaid principal at the rate specified in this Note, fees and other
charges payable as provided below.
2. TERM:
The term of the Loan ("Loan Term") shall be until July 1, 2005
("Maturity Date"), at which time the entire principal amount advanced,
plus unpaid interest, fees and other amounts and charges specified
herein shall be due and payable. Provided the Borrower is not in
default under this Note and the Mortgage, as determined by the Lender
in its sole discretion, the Borrower may extend the Loan Term
("Extended Loan Term") for an additional period of sixty (60) months
from the Maturity Date, to July 1, 2010 ("Extended Maturity Date").
Borrower shall give written notice to Lender of Xxxxxxxx's intention to
so extend the Maturity Date no less than sixty (60) days prior to the
Maturity Date.
3. INTEREST:
(a) From the date hereof, the Borrower shall pay interest on the
unpaid principal amount at the Interest Rate of Eight and
Three-Quarters (8.75%) percent per annum (the "Interest
Rate"). After any default, interest shall accrue at the rate
set forth in Section 9.1 of this Note.
(b) The Loan Term may be extended, and the Interest Rate may be
adjusted, as set forth below, provided the following
conditions are satisfied:
(i) Borrower notifies Xxxxxx of Xxxxxxxx's election to
extend not less than sixty (60) days prior to the Maturity
Date;
(ii) No default has occurred under the Note or Mortgage;
(iii) The Mortgage remains a valid first lien;
(iv) There has been no material adverse change in the
financial condition of the Borrower;
(v) A current appraisal of the Premises conducted at
Borrower's expense, by an appraiser satisfactory to Lender, is
submitted to Lender not less than sixty (60) days prior to the
Maturity Date and shows a loan-to-value ratio of not greater
than seventy-five percent (75%); and
(vi) The Debt Service Coverage Ratio (as defined below) is not
less than 1.2. The term "Debt Service Coverage Ratio" shall
mean a fraction, the denominator of which will be the debt
service for the loan (based upon the new Interest rate for the
upcoming rate
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period), and the numerator of which shall be the then current
Net Operating Income for the Premises. "Net Operating Income"
shall mean total gross revenues from the Premises, minus
operating expenses, and the replacement reserve, if required,
and in an amount determined by Lender in its discretion. The
Debt Service Coverage Ratio shall be based upon the then
current income and expense statements submitted by Borrower in
form and substance satisfactory to Lender.
Provided the foregoing conditions are satisfied, then the Maturity Date
may be extended through the Extended Maturity Date. The Interest Rate
on the unpaid principal during the Extended Loan term shall be reset to
two hundred fifty (250) basis points (2.50%) above the Current Index
Rate (the "Adjusted Interest Rate"), provided, however, the Adjusted
Interest Rate shall never be less than eight and three-quarters (8.75%)
percent per annum. The Current Index Rate shall be the weekly average
yield on United States Treasury securities as adjusted to a constant
maturity of five (5) years, as made available by the Federal Reserve
Board and published in the Wall Street Journal sixty (60) days prior to
the Maturity Date.
(c) In the event that Borrower and Lender agree to extend the Loan
Term, the new Interest Rate shall become effective on July 1,
2005 (the "Change Date"), or on such other date upon which the
parties may agree, and shall apply for the remainder of the
Loan Term.
4. PAYMENTS:
The Borrower shall make consecutive monthly payments of interest and
principal on all monies advanced under this Note, based on a twenty
(20) year amortization schedule, in the amount of $10,604.53 (exclusive
of escrows and any other required payments) commencing on August 1,
2000 and continuing on the first day of each and every month thereafter
until the Maturity Date. The foregoing payments shall be applied first
to escrow expenses and other amounts
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due under the Mortgage, then to interest and then to reduction of
principal, and shall be subject to adjustment in accordance with
Section 3 above, in which case Lender shall recalculate the monthly
payment of principal and interest, at the Adjusted Interest Rate
applied to the then outstanding principal balance amortized over a
fifteen (15) year period. If the Loan Term is extended to the Extended
Maturity Date pursuant to Section 2, Lender will advise Borrower of the
new monthly payment amount, and commencing August 1, 2005 (the "Payment
Change Date"), the Borrower shall make consecutive monthly payments at
the new payment amount and continuing thereafter until the Extended
Maturity Date, at which time all outstanding amounts of principal,
interest and any other charges on the Loan shall be due and payable in
full. Interest from the date of closing to the end of the month of
closing shall be due and payable at the Loan closing. Interest shall be
calculated on the basis of a 360 day year over the actual number of
days elapsed. All payments shall be made to Lender at the address shown
above, or to such other address as may be required by Lender.
5. PREPAYMENT:
The Loan may not be prepaid in whole, or in part, except that Borrower
shall have the right to prepay the loan in full, upon not less than
sixty (60) days written notice to Lender and upon payment of premium as
set forth in Schedule A (the "Prepayment Premium"). The Loan may be
prepaid without payment of the Prepayment Premium during the sixty (60)
day period preceding the end of the Loan Term. The Prepayment Premium
shall be due if the Loan is accelerated due to any default by Borrower.
In the event Borrower elects to extend the Loan Term as provided in
Section 2 above, Borrower shall have no right to prepay the Loan
without Prepayment Premium during the sixty (60) day period prior to
the Maturity Date. During the Extended Loan Term, Borrower shall have
the right to prepay the Loan Amount in full, upon not less than sixty
(60) days written notice to Lender and upon payment to Lender of the
Prepayment Premium. The Loan may be prepaid without payment of the
Prepayment Premium during the sixty (60) day period preceding the
Extended Maturity Date.
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Provided Borrower has not committed an uncured Event of Default,
application of condemnation awards to the outstanding principal shall
not require the payment of a Prepayment Premium.
6. LATE CHARGE:
If the Lender does not receive any monthly payment within fifteen (15)
days of its due date, then for each such late payment the Borrower
shall pay a late charge. The late charge shall be five (5.00%) percent
of the unpaid amount. Acceptance by Xxxxxx of a late payment shall not
be deemed or considered an election of remedies or waiver by Lender of
rights at law, or under this Note or the Mortgage. The late charge
specified in this Note is not intended nor shall be deemed as
liquidated damages or a penalty. The late charge constitutes a material
covenant of the loan and is a material inducement for the Lender to
enter into this loan.
7. MORTGAGE AS SECURITY:
As security for the payment of this Note, the Borrower is giving a
mortgage (the "Mortgage") to the Lender dated the date of this Note and
is entering into certain other agreements collateral to this loan, more
particularly described in the Mortgage (collectively, the "Loan
Documents"). The Mortgage covers the property (the "Premises") owned by
the Borrower at:
Address: 000 Xxxxxxxx Xxxxxx
Municipality: Xxxxxxxx
County and State: Xxxxxx County, New Jersey
Lot and Block: Lots 4 - 4.09, Block 193
The Premises are more particularly described in the Mortgage. This Note
shall evidence and the Mortgage shall secure the indebtedness described
herein and any future loans or advances that may be made to or on
behalf of the Borrower by the Lender at any time or times hereafter
under the Mortgage and any such loans or advances shall be added to and
shall bear interest at the same rate per annum as the principal
indebtedness hereunder subject to any increase expressly provided for
in this Note or the Mortgage.
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8. PAYMENT OF TAXES AND OTHER CHARGES:
(a) Borrower agrees with Lender: (i) to pay to the Lender,
at the time of each monthly payment, if requested by Xxxxxx,
one-twelfth (1/12th) of the current annual taxes and water
and sewer charges levied and assessed against the Premises
and to make tax reserve payments in such amounts and at such
time or times as the Lender shall require; (ii) to claim no
deduction upon the assessed value of such Premises on
account of the monies owing hereon; (iii) to pay all taxes,
assessments, water and sewer charges and other governmental
charges levied or assessed against the Premises within ten
(10) days after the same shall have become due and payable,
unless Xxxxxx collects an escrow for same; (iv) to keep the
building(s) on the Premises insured for the benefit of the
Lender as more particularly set forth in the Mortgage and to
maintain such other insurance as may be required under the
Mortgage, by insurers and in amounts approved by the Lender,
and to deliver such policy or policies of insurance to the
Lender or at the sole discretion of Lender, to pay to the
Lender, at the time of each monthly payment, if requested by
Lender, one-twelfth (1/12th) of the current annual insurance
premiums and to make insurance premium reserve payments in
such amounts and at such time or times as the Lender shall
require; and (v) to keep the building(s) on the Premises in
good repair and in a condition reasonably satisfactory to
the Lender.
(b) The Borrower further agrees that, should thirty (30) days
default be made in the payment of any such tax, insurance
premium, assessment, water, rents, or other governmental
charges, or in the payment of a premium for such insurance, or
should any default be made in the obligation to keep the
Premises in satisfactory repair and condition, then the Lender
may pay such amount or amounts and the amount so paid shall be
added to the amount owing hereunder and shall be due and
payable on demand, with interest at the Default Rate defined
below.
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9. XXXXXX'S RIGHT OF ACCELERATION:
The Lender may declare the unpaid principal, interest, fees, and other
amounts and charges specified under this Note due immediately upon the
occurrence of an Event of Default, as defined below. This right is
called acceleration. Each of the following shall constitute an Event of
Default:
(a) Any report, certificate, financial statement or other
instrument furnished in connection with this Note or the
borrowing hereunder shall have been proven to be false or
misleading; or
(b) Thirty (30) days default in any payment of principal or
interest due on this Note; or
(c) Thirty (30) days default in the payment of any tax,
assessment, water, rents, or other governmental charges, or in
the payment of a premium for insurance; or
(d) The Borrower's (i) application for or consent to the
appointment of a receiver, trustee or liquidator of the
Borrower for all or a substantial part of its properties or
assets, (ii) admitting in writing its inability to pay its
debts as they mature, (iii) making a general assignment for
the benefit of creditors, (iv) being adjudicated a bankrupt
or insolvent, or (v) filing a voluntary petition in
bankruptcy, or a petition or answer seeking reorganization
or an arrangement with creditors or taking advantage of any
bankruptcy, reorganization, insolvency, readjustment of
debt, dissolution or liquidation law or statute, or an
answer admitting the material allegations of a petition
filed against it in any proceeding under any such law or if
corporation action shall be taken by the Borrower for the
purpose of effecting any of the foregoing; or
(e) An order, judgment or decree being entered, without the
application, approval or consent of the Borrower by any court
of competent jurisdiction, approving or seeking reorganization
of the Borrower or of all or a
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substantial part of the properties or assets of the Borrower
and such order, judgment or decree continuing unstayed and in
effect for any period of sixty (60) days or more; or
(f) Any cause that gives the Lender the right of acceleration
under the Note, Mortgage or Loan Documents; or
(g) The imposition of a construction or mechanics lien against the
Premises, which is not removed by the posting of a bond or
other legal means within thirty (30) days of the imposition of
same; or
(h) If borrower fails to comply with any provision of this Note,
the Mortgage, or the Loan Documents, within thirty (30) days
after having received notice from the Lender. The foregoing
notice and cure period shall not apply as to any payment of
principal, interest and/or other amounts due under this Note
and the Mortgage, and any matters covered by subsections (a) -
(g) hereinabove.
The Lender's failure to accelerate for any cause shall not prevent the
Lender from doing so for a later cause.
9.l DEFAULT RATE:
In the event of any default hereunder or under the Loan Documents,
interest as of the date of default shall accrue on the unpaid balance
of the Loan at a rate equal to the lesser of fifteen (15.00%) percent
per annum or the highest rate permitted by law ("Default Rate"). The
Default Rate specified in this Note is not intended nor shall be deemed
as liquidated damages or a penalty. The Default Rate constitutes a
material covenant of the loan and is a material inducement for the
Lender to enter into this loan.
10. WAIVER OF FORMAL ACTS:
The Lender is not required to do any of the following before enforcing
the Lender's rights under this Note:
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(a) To demand payment of amounts due (known as Presentment);
(b) To give notice that amounts due have not been paid
(known as Notice of Dishonor); or
(c) To obtain an official certificate of non-payment (know as a
Protest).
11. TRIAL BY JURY:
THE BORROWER AND XXXXXX AGREE THAT ANY SUIT, ACTION OR PROCEEDING,
WHETHER CLAIM OR COUNTERCLAIM, BROUGHT BY XXXXXX OR THE BORROWER, ON OR
WITH RESPECT TO THIS NOTE OR ANY OTHER LOAN DOCUMENT OR THE DEALINGS OF
THE PARTIES WITH RESPECT HERETO OR THERETO, SHALL BE TRIED ONLY BY A
COURT AND NOT BY A JURY. THE LENDER AND THE BORROWER EACH HEREBY
KNOWINGLY, VOLUNTARILY, INTENTIONALLY AND INTELLIGENTLY, AND WITH THE
ADVICE OF THEIR RESPECTIVE COUNSEL, WAIVE ANY RIGHT TO A TRIAL BY JURY
IN ANY SUCH SUIT, ACTION OR PROCEEDING. FURTHER, THE BORROWER WAIVES
ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER, IN ANY SUCH SUIT, ACTION OR
PROCEEDING, ANY SPECIAL, EXEMPLARY, PUNITIVE, CONSEQUENTIAL OR OTHER
DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES. THE BORROWER
ACKNOWLEDGES AND AGREES THAT THIS SECTION IS A SPECIFIC AND MATERIAL
ASPECT OF THIS NOTE AND THAT THE LENDER WOULD NOT EXTEND CREDIT TO THE
BORROWER IF THE WAIVERS SET FORTH IN THIS SECTION WERE NOT A PART OF
THIS NOTE.
12. RESPONSIBILITY UNDER NOTE:
If more than one Borrower signs this Note, each one is obligated to pay
the amount due under the Note. This Note is the joint and several
obligation of the Borrowers and the Lender may enforce this Note
against any one or more Borrowers separately or against all Borrowers
together.
13. CHANGE:
This Note cannot be changed except in writing signed by the Borrower
and the Lender, except that Lender may grant extensions in the time of
payment of and reduction in the rate of interest on the monies due and
owed under this Note.
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14. COST OF COLLECTION;
If the Lender has to consult an attorney, or go to court, or if the
Borrower fails to comply with the terms of this Note, the Borrower will
pay all Lender's collection costs, plus reasonable attorneys' fees and
disbursements.
15. GOVERNING LAW:
This Note has been executed in the State of New Jersey and is to be
construed and enforced according to and governed by the laws of the
State of New Jersey.
16. RIGHT OF SETOFF:
The Lender shall have the right to apply any monies which the Lender
may have on deposit against any amounts which may be past due under
this Note, or hold as security for the payment hereof any other
property heretofore or hereafter delivered by the Borrower into the
custody, control or possession of the Lender for any reason or purpose
whatsoever.
17. ADDITIONAL FINANCING:
During the term of this Note the Borrower shall not obtain any
additional financing or use of credit that would result in a lien on
the Premises. In the event Borrower violates this covenant, then at the
option of the Lender, the unpaid principal, interest, fees, and other
amounts and charges under this Note shall be immediately due and
payable in full.
18. CROSS DEFAULT:
Any default in any obligation under any of the Loan Documents or any
other obligations of Borrower, or its assigns, or any related person
under common control with the Borrower or controlled by the Borrower,
to Lender, whether oral or written, secured or unsecured, and
regardless of their nature, and all future obligations, when they are
incurred (the "Obligations"), shall constitute a default hereunder,
giving the Lender the right
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and option to accelerate this obligation and declare the then unpaid
balance due and shall entitle Lender to declare the Mortgage and
accompanying Note which it secures immediately due and payable. This
covenant shall be effective without the execution of any further
assurance, amendment of mortgage or any affirmative action by Xxxxxxxx.
In the event the Borrower shall default hereunder, such default shall
constitute a default under the Obligations and Lender at its option,
may declare all such Obligations and mortgages immediately due and
payable.
19. LOAN CHARGES:
Any and all payments under the Loan Documents, including without
limitation, the Interest Rate, Default Rate, late charges, Prepayment
Premium and any other charges or amounts due hereunder constitute
material covenants of the Loan and are: (1) a material inducement for
the Lender to enter into this Loan; (2) the Lender would not have
entered into this Loan without the Borrower's agreement and covenant to
make the payments as specified in the Loan Documents; (3) some
additional payments, such as the Default Rate, are deemed by the Lender
as compensation to the Lender for the increased risk associated with
this Loan not being timely repaid and (4) the additional payments
represent reasonable estimates to the Lender in allocating its
resources (both personnel and financial) to the ongoing review,
monitoring, administration and collection of the Loan.
If the Loan is subject to a law which sets maximum loan charges, and
that law is finally interpreted so that the interest or other charges
collected or to be collected in connection with the Loan exceed the
permitted limits, then: (a) any such loan charge shall be reduced by
the amount necessary to reduce the charge to the permitted limit; and
(b) any sums already collected from Borrower which exceeded permitted
limits will be refunded to Borrower. Lender may choose to make this
refund by reducing the principal owed under this Note or by making a
direct payment to Borrower. If a refund reduces principal, the
reduction will be treated as a partial prepayment without any
prepayment charge under this Note.
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20. ALIENATION:
In the event that all or any part of the Premises, or any interests
comprising ten (10%) percent or more, in the aggregate, in the
ownership of Borrower, shall be sold, transferred, assigned or
encumbered (except leases to residential tenants who occupy the
Premises), without the prior written consent of the Lender (and of
Lender's participants, if any), which consent shall not be unreasonably
withheld, then, at the option of the Lender, the unpaid principal,
interest, fees, and any other amounts and charges under this Note shall
be immediately due and payable in full. Nothing herein limits transfer
by the Principals of Borrower to "Family Members" defined as any
spouse, child, parent or sibling.
21. BALLOON NOTE:
At the Maturity Date (or Extended Maturity Date, if applicable) of this
Note the full amount of the principal, interest, fee and other amounts
and charges due under this Note shall become due and payable unless
Borrower has prepaid such sum in whole or in part. Lender shall have no
obligation to extend the Loan Term or refinance the unpaid amount.
22. SERVICE OF PROCESS:
Borrower hereby appoints Xxxxxxxx X. Xxxxxxxxx, Esq., an attorney at
law of the State of New Jersey, as Xxxxxxxx's agent for service of
process for any matters relating to this Note and the Loan Documents.
Borrower covenants that revocation of such appointment shall not be
effective unless Xxxxxxxx provides Lender at least thirty (30) days
prior written notice and Borrower simultaneously appoints a substitute
agent for service of process, which substitute agent shall be an
attorney at law of the State of New Jersey maintaining an office in the
State of New Jersey.
23. JURISDICTION:
Borrower hereby submits to the personal jurisdiction of the courts of
the State of New Jersey for any matters relating to this Note and the
Loan Documents.
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24. SALE OR HYPOTHECATION:
The rights of the Lender hereunder shall not be impaired by the
Lender's sale, pledge or hypothecation of this Note or any item of the
Security. Any purchaser, assignee, transferee or pledgee of this Note
(and of any item of security assigned, pledged or hypothecated
therewith) shall become vested with and entitled to exercise all the
powers and rights given by this Note and all related applications,
certifications, affidavits, guarantees or instruments; creating
security interests, as if the purchaser, assignee, transferee or
pledgee were originally named as payee in this Note and in the
applications, certifications, affidavits, guarantees or instruments
creating security interests. The Lender reserves the right in its
absolute discretion to sell or grant participation interests in all or
a part of the Loan and in connection therewith reserves the right, and
the Borrower hereby authorizes the Lender, to disclose to such
prospective purchaser or participant any and all of the credit
information, applications, certifications, affidavits and loan
documentation provided by the Borrower or any guarantor in connection
with this or any other transaction.
25. SIGNATURE:
The Borrower agrees to the terms of this Note by signing below.
Schedule A - Prepayment Premium
WITNESS:
INTEGRATED ANALYTICAL
REALTY, L.L.C., a
New Jersey Limited
Liability company
/s/Xxxxxxxx X. Xxxxxxxxx By:/s/Xxxxxxx Xxxxxx
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Xxxxxxxx X. Xxxxxxxxx, Esq. Xxxxxxx Xxxxxx
Attorney at Law Manager
State of New Jersey
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SCHEDULE A
PREPAYMENT PREMIUM
Initial Loan Term:
Months 1-12 5% of outstanding principal
Months 13-24 4% of outstanding principal
Months 25-36 3% of outstanding principal
Months 37-48 2% of outstanding principal
Months 49-60 1% of outstanding principal
Extended Loan Term:
Months 61-72 5% of outstanding principal
Months 73-84 4% of outstanding principal
Months 85-96 3% of outstanding principal
Months 97-108 2% of outstanding principal
Months 109-160 1% of outstanding principal
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