AMENDED AND RESTATED MULTIFAMILY NOTE
AMENDED
AND RESTATED
THIS
AMENDED AND RESTATED MULTIFAMILY NOTE is made and entered into as of the
1st
day of
November, 2006, by and between NEW
FOREST APARTMENTS, LLC,
a
Maryland limited liability company ("Borrower")
and
XXXXX
FARGO BANK, N.A.,
a
national banking association ("Lender").
PRELIMINARY
STATEMENTS
A. A
loan
was made to New Forest General Partnership, a Maryland general partnership,
now
known as Borrower, in the original principal amount of Twelve Million One
Hundred Forty-Three Thousand Eight Hundred and No/100ths Dollars
($12,143,800.00), the repayment of which is evidenced by a Deed of Trust
Note
dated February 24, 1987 (the "Original
Note").
B. The
Original Note is secured by a Deed of Trust dated February 24, 1987 and recorded
among the Land Records of Xxxxxxx County, Maryland in Liber 1190, folio 390
(the
"Original
Deed of Trust"),
on
certain improved real property located in Xxxxxxx County, Maryland.
C. Lender
has purchased the Original Note from its holder.
D. Borrower
has requested and Lender has agreed to make certain amendments to the Original
Note, including changing the interest rate and the terms of payment, and
increasing the original principal amount from Twelve Million One Hundred
Forty-Three Thousand Eight Hundred and No/l00ths
Dollars
($12,143,800.00) to Twenty-Three Million and No/l00ths
Dollars
($23,000,000.00). The Original Note is being amended and restated in its
entirety to reflect such amendments.
E. The
Original Deed of Trust is concurrently being amended and restated pursuant
to
the terms of that certain Amended and Restated Multifamily Deed of Trust,
Assignment of Rents and Security Agreement of even date herewith (as so amended
and restated, the "Security
Instrument").
NOW,
THEREFORE, in consideration of the premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the
Borrower and Lender agree that the Original Note is hereby amended and restated
in its entirety as follows (as amended and restated, the "Note"):
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US
$23,000,000.00
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as
of November 1, 2006
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FOR
VALUE RECEIVED,
the
undersigned ("Borrower")
jointly and severally (if more than one) promises to pay to the order of
XXXXX
FARGO BANK, N.A.,
a
national banking association, the principal sum of Twenty-Three Million and
No/l00ths Dollars (US $23,000,000.00), with interest accruing at the
Interest Rate on the unpaid principal balance from the Disbursement Date
until
fully paid.
1. Defined
Terms.
In
addition to defined terms found elsewhere in this Note, as used in this Note,
the following definitions shall apply:
Amortization
Period:
360
months.
Business
Day:
Any day
other than a Saturday, Sunday or any other day on which Lender is not open
for
business.
Debt
Service Amounts:
Amounts
payable under this Note, the Security Instrument or any other Loan
Document.
Default
Rate:
A rate
equal to the lesser of 4 percentage points above the Interest Rate or the
maximum interest rate which may be collected from Borrower under applicable
law.
Disbursement
Date:
The date
of disbursement of Loan proceeds hereunder.
First
Payment Date:
The
first day of December, 2006.
Indebtedness: The
principal of, interest on, or any other amounts due at any time under, this
Note, the Security Instrument or any other Loan Document, including prepayment
premiums, late charges, default interest, and advances to protect the security
of the Security Instrument under Section 12 of the Security Instrument.
Interest
Rate:
The
annual rate of six and seventy-five thousandths percent (6.075%).
Lender: The
holder of this Note.
Loan: The
loan
evidenced by this Note.
Loan
Term:
120
months.
Maturity
Date:
The
first day of November, 2016, or any earlier date on which the unpaid principal
balance of this Note becomes due and payable by acceleration or
otherwise.
Property
Jurisdiction:
The
jurisdiction in which the Land is located.
Security
Instrument:
A
multifamily mortgage, deed to secure debt or deed of trust dated as of the
date
of this Note.
Yield
Maintenance Period Term or Prepayment Premium Period Term:
114
months.
Yield
Maintenance Period End Date or Prepayment Premium Period End
Date:
The
last day of April, 2016.
Event
of
Default, Key Principal and other capitalized terms used but not defined in
this
Note shall have the meanings given to such terms in the Security Instrument.
2. Address
for Payment.
All
payments due under this Note shall be payable at 0000 Xxxxxxxxx Xxxxx, Xxxxx
0000, XxXxxx, XX 00000, or such other place as may be designated by written
notice to Borrower from or on behalf of Lender.
3. Payment
of Principal and Interest.
Principal and interest shall be paid as follows:
(a) Short
Month Interest.
If
disbursement of principal is made by Lender to Borrower on any day other
than
the first day of the month, interest for the period beginning on the
Disbursement Date and ending on and including the last day of the month in
which
such disbursement is made shall be payable simultaneously with the execution
of
this Note.
(b) Interest
Computation.
Interest
under this Note shall be computed on the basis of (check one only):
30/360.
A
360-day year consisting of twelve 30-day months.
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Actual/360.
A
360-day year. The
amount of each monthly
payment made by Borrower pursuant to Paragraph 3(c) below that
is
allocated to interest will be based on the actual number of calendar
days
during such month and shall be calculated by multiplying the unpaid
principal balance of this Note by the per annum Interest Rate,
dividing
the product by 360 and multiplying the quotient by the actual number
of
days elapsed during the month. Borrower understands that the amount
allocated to interest for each month will vary depending on the
actual
number of calendar days during such
month.
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(c) Monthly
Installments.
Consecutive monthly installments of principal and interest, each in the amount
of One Hundred Thirty-Nine Thousand Seven and 61/100ths Dollars (US
$139,007.61), shall be payable on the First Payment Date and on the first
day of
every month thereafter, until the entire unpaid principal balance evidenced
by
this Note is fully paid. Any remaining principal and interest shall be due
and
payable on the Maturity Date. The unpaid principal balance shall continue
to
bear interest after the Maturity Date at the Default Rate set forth in this
Note
until and including the date on which it is paid in full.
(d) Payments
Before Due Date.
Any
regularly scheduled monthly installment of principal and interest that is
received by Lender before the date it is due shall be deemed to have been
received on the due date solely for the purpose of calculating interest
due.
(e) Accrued
Interest.
Any
accrued interest remaining past due for 30 days or more shall be added to
and
become part of the unpaid principal balance and shall bear interest at the
rate
or rates specified in this Note. Any reference herein to "accrued interest"
shall refer to accrued interest which has not become part of the unpaid
principal balance. Any amount added to principal pursuant to the Loan Documents
shall bear interest at the applicable rate or rates specified in this Note
and
shall be payable with such interest upon demand by Lender and absent such
demand, as provided in this Note for the payment of principal and
interest.
4. Application
of Payments. If
at any
time Lender receives, from Borrower or otherwise, any amount applicable to
the
Indebtedness which is less than all amounts due and payable at such time,
Lender
may apply that payment to amounts then due and payable in any manner and
in any
order determined by Lender, in Lender's discretion. Borrower agrees that
neither
Lender's acceptance of a payment from Borrower in an amount that is less
than
all amounts then due and payable nor Lender's application of such payment
shall
constitute or be deemed to constitute either a waiver of the unpaid amounts
or
an accord and satisfaction.
5. Security.
The
Indebtedness is secured, among other things, by the Security Instrument,
and
reference is made to the Security Instrument for other rights of Lender
concerning the collateral for the Indebtedness.
6. Acceleration.
If
an
Event of Default has occurred and is continuing, the entire unpaid principal
balance, any accrued interest, the prepayment premium payable under Paragraph
10, if any, and all other amounts payable under this Note and any other Loan
Document shall at once become due and payable, at the option of Lender, without
any prior notice to Borrower. Lender may exercise this option to accelerate
regardless of any prior forbearance.
7. Late
Charge. If
any
monthly installment due hereunder is not received by Lender on or before
the
10th day of each month or if any other amount payable under this Note or
under
the Security Instrument or any other Loan Document is not received by Lender
within 10 days after the date such amount is due, counting from and including
the date such amount is due, Borrower shall pay to Lender, immediately and
without demand by Lender, a late charge equal to 5 percent of such monthly
installment or other amount due. Borrower acknowledges that its failure to
make
timely payments will cause Lender to incur additional expenses in servicing
and
processing the Loan and that it is extremely difficult and impractical to
determine those additional expenses. Borrower agrees that the late charge
payable pursuant to this Paragraph represents a fair and reasonable estimate,
taking into account all circumstances existing on the date of this Note,
of the
additional expenses Lender will incur by reason of such late payment. The
late
charge is payable in addition to, and not in lieu of, any interest payable
at
the Default Rate pursuant to Paragraph 8.
8. Default
Rate. So
long
as any monthly installment or any other payment due under this Note remains
past
due for 30 days or more, interest under this Note shall accrue on the unpaid
principal balance from the earlier of the due date of the first unpaid monthly
installment or other payment due, as applicable, at the Default Rate. If
the
unpaid principal balance and all accrued interest are not paid in full on
the
Maturity Date, the unpaid principal balance and all accrued interest shall
bear
interest from the Maturity Date at the Default Rate. Borrower also acknowledges
that its failure to make timely payments will cause Lender to incur additional
expenses in servicing and processing the Loan, that, during the time that
any
monthly installment or payment under this Note is delinquent for more than
30
days, Lender will incur additional costs and expenses arising from its loss
of
the use of the money due and from the adverse impact on Lender's ability
to meet
its other obligations and to take advantage of other investment opportunities,
and that it is extremely difficult and impractical to determine those additional
costs and expenses. Borrower also acknowledges that, during the time that
any
monthly installment or other payment due under this Note is delinquent for
more
than 30 days, Lender's risk of nonpayment of this Note will be materially
increased and Lender is entitled to be compensated for such increased risk.
Borrower agrees that the increase in the rate of interest payable under this
Note to the Default Rate represents a fair and reasonable estimate, taking
into
account all circumstances existing on the date of this Note, of the additional
costs and expenses Lender will incur by reason of the Borrower's delinquent
payment and the additional compensation Lender is entitled to receive for
the
increased risks of nonpayment associated with a delinquent loan.
9. Limits
on Personal Liability.
(a) Except
as
otherwise provided in this Paragraph 9, Borrower shall have no personal
liability under this Note, the Security Instrument or any other Loan Document
for the repayment of the Indebtedness or for the performance of any other
obligations of Borrower under the Loan Documents, and Lender's only recourse
for
the satisfaction of the Indebtedness and the performance of such obligations
shall be Lender's exercise of its rights and remedies with respect to the
Mortgaged Property (as such term is defined in the Security Instrument) and
any
other collateral held by Lender as security for the Indebtedness. This
limitation on Borrower's liability shall not limit or impair Lender's
enforcement of its rights against any guarantor of the Indebtedness or any
guarantor of any obligations of Borrower.
(b) Borrower
shall be personally liable to Lender for the repayment of a portion of the
Indebtedness equal to any loss or damage suffered by Lender as a result
of:
(1) failure
of Borrower to pay to Lender upon demand after an Event of Default, all Rents
to
which Lender is entitled under Section 3(a) of the Security Instrument and
the
amount of all security deposits collected by Borrower from tenants then in
residence;
(2) failure
of Borrower to apply all insurance proceeds and condemnation proceeds as
required by the Security Instrument;
(3) failure
of Borrower to comply with Section 14(d) or (e) of the Security Instrument
relating to the delivery of books and records, statements, schedules and
reports;
(4) fraud
or
written material misrepresentation by Borrower, Key Principal or any officer,
director, partner, member or employee of Borrower in connection with the
application for or creation of the Indebtedness or any request for any action
or
consent by Lender; or
(5) failure
to apply Rents, first, to the payment of reasonable operating expenses (other
than Property management fees that are not currently payable pursuant to
the
terms of an Assignment of Management Agreement or any other agreement with
Lender executed in connection with the Loan) and then to Debt Service Amounts,
except that Borrower will not be personally liable (i) to the extent that
Borrower lacks the legal right to direct the disbursement of such sums because
of a bankruptcy, receivership or similar judicial proceeding, or (ii) with
respect to Rents that are distributed in any calendar year if Borrower has
paid
all operating expenses and Debt Service Amounts for that calendar
year.
(c) Borrower
shall become personally liable to Lender for the repayment of all of the
Indebtedness upon the occurrence of any of the following Events of Default:
(1) Borrower's
acquisition of any property or operation of any business not permitted by
Section 33 of the Security Instrument; or
(2) a
Transfer that is an Event of Default under Section 21 of the Security
Instrument.
(d) To
the
extent that Borrower has personal liability under this Paragraph 9, Lender
may
exercise its rights against Borrower personally without regard to whether
Lender
has exercised any rights against the Mortgaged Property or any other security,
or pursued any rights against any guarantor, or pursued any other rights
available to Lender under this Note, the Security Instrument, any other Loan
Document or applicable law. For purposes of this Paragraph 9, the term
"Mortgaged Property" shall not include any funds that (1) have been applied
by
Borrower as required or permitted by the Security Instrument prior to the
occurrence of an Event of Default, or (2) Borrower was unable to apply as
required or permitted by the Security Instrument because of a bankruptcy,
receivership, or similar judicial proceeding.
10. Voluntary
and Involuntary Prepayments.
(a) A
prepayment premium shall be payable in connection with any prepayment made
under
this Note as provided below:
(1) Borrower
may voluntarily prepay all (but not less than all) of the unpaid principal
balance of this Note only on the last calendar day of a calendar month (the
"Last Day of the Month") and only if Borrower has complied with all of the
following:
| (i) |
Borrower
must give Lender at least 30 days (if given via U.S. Postal Service)
or 20
days (if given via facsimile, email or overnight courier), but not
more
than 60 days, prior written notice of Borrower's intention to make
a
prepayment (the "Prepayment Notice"). The Prepayment Notice shall
be given
in writing (via facsimile, email, U.S. Postal Service or overnight
courier) and addressed to Lender. The Prepayment Notice shall include,
at
a minimum, the Business Day upon which Borrower intends to make the
prepayment (the "Intended Prepayment Date").
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| (ii) |
Borrower
acknowledges that the Lender is not required to accept any voluntary
prepayment of this Note on any day other than the Last Day of the
Month
even (A) if Borrower has given a Prepayment Notice with an Intended
Prepayment Date other than the Last Day of the Month or (B) if the
Last
Day of the Month is not a Business Day. Therefore, even if Lender
accepts
a voluntary prepayment on any day other than the Last Day of the
Month,
for all purposes (including the accrual of interest and the calculation
of
the prepayment premium), any prepayment received by Lender on any
day
other than the Last Day of the Month shall be deemed to have been
received
by Lender on the Last Day of the Month and any prepayment calculation
will
include interest to and including the Last Day of the Month in which
such
prepayment occurs. If the Last Day of the Month is not a Business
Day,
then the Borrower must make the payment on the Business Day immediately
preceding the Last Day of the Month.
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| (iii) |
Any
prepayment shall be made by paying (A) the amount of principal being
prepaid, (B) all accrued interest (calculated to the Last Day of
the
Month), (C) all other sums due Lender at the time of such prepayment,
and
(D) the prepayment premium calculated pursuant to Schedule A.
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| (iv) |
If,
for any reason, Borrower fails to prepay this Note (A) within five
(5)
Business Days after the Intended Prepayment Date or (B) if the prepayment
occurs in a month other than the month stated in the original Prepayment
Notice, then Lender shall have the right, but not the obligation,
to
recalculate the prepayment premium based upon the date that Borrower
actually prepays this Note and to make such calculation as described
in
Schedule A attached hereto. For purposes of such recalculation, such
new
prepayment date shall be deemed the "Intended Prepayment Date."
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(2) Upon
Lender's exercise of any right of acceleration under this Note, Borrower
shall
pay to Lender, in addition to the entire unpaid principal balance of this
Note
outstanding at the time of the acceleration, (i) all accrued interest and
all
other sums due Lender under this Note and the other Loan Documents, and
(ii) the prepayment premium calculated pursuant to Schedule A.
(3) Any
application by Lender of any collateral or other security to the repayment
of
any portion of the unpaid principal balance of this Note prior to the Maturity
Date and in the absence of acceleration shall be deemed to be a partial
prepayment by Borrower, requiring the payment to Lender by Borrower of a
prepayment premium.
(b) Notwithstanding
the provisions of Paragraph 10(a), no prepayment premium shall be payable
(1)
with respect to any prepayment occurring as a result of the application of
any
insurance proceeds or condemnation award under the Security Instrument, or
(2)
as provided in subparagraph (c) of Schedule A.
(c) Schedule
A is hereby incorporated by reference into this Note.
(d) Any
required prepayment of less than the entire unpaid principal balance of this
Note shall not extend or postpone the due date of any subsequent monthly
installments or change the amount of such installments, unless Lender agrees
otherwise in writing.
(e) Borrower
recognizes that any prepayment of the unpaid principal balance of this Note,
whether voluntary or involuntary or resulting from a default by Borrower,
will
result in Lender's incurring loss, including reinvestment loss, additional
expense and frustration or impairment of Lender's ability to meet its
commitments to third parties. Borrower agrees to pay to Lender upon demand
damages for the detriment caused by any prepayment, and agrees that it is
extremely difficult and impractical to ascertain the extent of such damages.
Borrower therefore acknowledges and agrees that the formula for calculating
prepayment premiums set forth on Schedule A represents a reasonable estimate
of
the damages Lender will incur because of a prepayment.
(f) Borrower
further acknowledges that the prepayment premium provisions of this Note
are a
material part of the consideration for the loan evidenced by this Note, and
acknowledges that the terms of this Note are in other respects more favorable
to
Borrower as a result of the Borrower's voluntary agreement to the prepayment
premium provisions.
11. Costs
and Expenses. Borrower
shall pay on demand all expenses and costs, including fees and out-of-pocket
expenses of attorneys and expert witnesses and costs of investigation, incurred
by Lender as a result of any default under this Note or in connection with
efforts to collect any amount due under this Note, or to enforce the provisions
of any of the other Loan Documents, including those incurred in post-judgment
collection efforts and in any bankruptcy proceeding (including any action
for
relief from the automatic stay of any bankruptcy proceeding) or judicial
or
non-judicial foreclosure proceeding.
12. Forbearance.
Any
forbearance by Lender in exercising any right or remedy under this Note,
the
Security Instrument, or any other Loan Document or otherwise afforded by
applicable law, shall not be a waiver of or preclude the exercise of that
or any
other right or remedy. The acceptance by Lender of any payment after the
due
date of such payment, or in an amount which is less than the required payment,
shall not be a waiver of Lender's right to require prompt payment when due
of
all other payments or to exercise any right or remedy with respect to any
failure to make prompt payment. Enforcement by Lender of any security for
Borrower's obligations under this Note shall not constitute an election by
Lender of remedies so as to preclude the exercise of any other right or remedy
available to Lender.
13. Waivers.
Presentment,
demand, notice of dishonor, protest, notice of acceleration, notice of intent
to
demand or accelerate payment or maturity, presentment for payment, notice
of
nonpayment, grace, and diligence in collecting the Indebtedness are waived
by
Borrower, Key Principal, and all endorsers and guarantors of this Note and
all
other third party obligors.
14. Loan
Charges.
Borrower
agrees to pay an effective rate of interest equal to the sum of the Interest
Rate provided for in this Note and any additional rate of interest resulting
from any other charges of interest or in the nature of interest paid or to
be
paid in connection with the loan evidenced by this Note and any other fees
or
amounts to be paid by Borrower pursuant to any of the other Loan Documents.
Neither this Note nor any of the other Loan Documents shall be construed
to
create a contract for the use, forbearance or detention of money requiring
payment of interest at a rate greater than the maximum interest rate permitted
to be charged under applicable law. If any applicable law limiting the amount
of
interest or other charges permitted to be collected from Borrower in connection
with the Loan is interpreted so that any interest or other charge provided
for
in any Loan Document, whether considered separately or together with other
charges provided for in any other Loan Document, violates that law, and Borrower
is entitled to the benefit of that law, that interest or charge is hereby
reduced to the extent necessary to eliminate that violation. The amounts,
if
any, previously paid to Lender in excess of the permitted amounts shall be
applied by Lender to reduce the unpaid principal balance of this Note. For
the
purpose of determining whether any applicable law limiting the amount of
interest or other charges permitted to be collected from Borrower has been
violated, all Indebtedness that constitutes interest, as well as all other
charges made in connection with the Indebtedness that constitute interest,
shall
be deemed to be allocated and spread ratably over the stated term of the
Note.
Unless otherwise required by applicable law, such allocation and spreading
shall
be effected in such a manner that the rate of interest so computed is uniform
throughout the stated term of the Note.
15. Commercial
Purpose. Borrower
represents that the Indebtedness is being incurred by Borrower solely for
the
purpose of carrying on a business or commercial enterprise, and not for
personal, family or household purposes.
16. Counting
of Days. Except
where otherwise specifically provided, any reference in this Note to a period
of
"days" means calendar days, not Business Days.
17. Governing
Law. This
Note
shall be governed by the law of the jurisdiction in which the Land is
located.
18. Captions.
The
captions of the paragraphs of this Note are for convenience only and shall
be
disregarded in construing this Note.
19. Notices.
All
notices, demands and other communications required or permitted to be given
by
Lender to Borrower pursuant to this Note shall be given in accordance with
Section 31 of the Security Instrument.
20. Consent
to Jurisdiction and Venue. Borrower
and Key Principal each agrees that any controversy arising under or in relation
to this Note shall be litigated exclusively in the Property Jurisdiction.
The
state and federal courts and authorities with jurisdiction in the Property
Jurisdiction shall have exclusive jurisdiction over all controversies which
shall arise under or in relation to this Note. Borrower and Key Principal
each
irrevocably consents to service, jurisdiction, and venue of such courts for
any
such litigation and waives any other venue to which it might be entitled
by
virtue of domicile, habitual residence or otherwise.
21. WAIVER
OF TRIAL BY JURY. BORROWER, KEY PRINCIPAL AND LENDER EACH (A) AGREES NOT
TO
ELECT A TRIAL BY JURY WITH RESPECT TO ANY ISSUE ARISING OUT OF THIS NOTE
OR THE
RELATIONSHIP BETWEEN THE PARTIES AS LENDER, KEY PRINCIPAL AND BORROWER THAT
IS
TRIABLE OF RIGHT BY A JURY AND (B) WAIVES ANY RIGHT TO TRIAL BY JURY WITH
RESPECT TO SUCH ISSUE TO THE EXTENT THAT ANY SUCH RIGHT EXISTS NOW OR IN
THE
FUTURE. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS SEPARATELY GIVEN BY EACH
PARTY,
KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF COMPETENT LEGAL COUNSEL.
22. No
Novation. This
Amended and Restated Multifamily Note does not extinguish the outstanding
indebtedness evidenced by the Original Note or discharge or release the Original
Deed of Trust or any other security, and the parties do not intend this Amended
and Restated Multifamily Note to be a substitution or novation of the original
indebtedness or instruments securing the same.
ATTACHED
SCHEDULES. The following Schedules are attached to this
Note:
x
Schedule
A
Prepayment
Premium (required)
Schedule
B Modifications
to Multifamily Note
[DOCUMENT
EXECUTION OCCURS ON FOLLOWING PAGES]
IN
WITNESS WHEREOF,
Borrower has signed and delivered this Note under seal or has caused this
Note
to be signed and delivered under seal by its duly authorized representative.
Borrower intends that this Note shall be deemed to be signed and delivered
as a
sealed instrument.
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BORROWER:
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|
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NEW
FOREST APARTMENTS, LLC
|
|
|
a
Maryland limited liability company
|
|
By: AMERICAN
HOUSING PROPERTIES L.P.
a
Delaware limited partnership
Managing
Member
By: American
Housing Management Company
a
Delaware corporation
General
Partner
By: _/s/
Xxxx Resnick___________________(Seal)
Name: _Paul
Resnik____________________
Title: __Vice
President__________________
Borrower’s
Employer
Identification No. 00-0000000
[DOCUMENT
EXECUTION CONTINUES ON THE FOLLOWING PAGE]
XXXXX
FARGO BANK, N.A.,
holder
of
the
Original Note, signs below to acknowledge its consent to the terms of
this
Amended and Restated Multifamily Note.
XXXXX
FARGO BANK, N.A.
a
national banking association
By: _/s/Xxxxxx
X. Hussey______________(SEAL)
Xxxxxx
X.
Xxxxxx
Senior
Vice President
Xxxxxx
Mae Commitment Number: 943255
ENDORSEMENT
TO
AMENDED AND RESTATED MULTIFAMILY NOTE
dated
as
of November 1, 2006,
given
by
NEW
FOREST APARTMENTS, LLC
a
Maryland limited liability company
to
XXXXX
FARGO BANK, N.A.
a
national banking association
in
the
original principal amount of $23,000,000.00
Pay
to
the order of XXXXXX
MAE,
without
recourse.
XXXXX
FARGO BANK, N.A.
a
national banking association
By: ___Edward
D. Hussey____________________________(Seal)
Xxxxxx
X.
Xxxxxx
Senior
Vice President
Date: as
of
November 1, 2006
ACKNOWLEDGMENT
AND AGREEMENT OF KEY PRINCIPAL TO
PERSONAL
LIABILITY FOR EXCEPTIONS TO NON-RECOURSE LIABILITY
Key
Principal, who has an economic interest in Borrower or who will otherwise
obtain
a material financial benefit from the Loan, hereby absolutely, unconditionally
and irrevocably agrees to pay to Lender, or its assigns, on demand, all amounts
for which Borrower is personally liable under Paragraph 9 of the Multifamily
Note to which this Acknowledgment is attached (the "Note").
The
obligations of Key Principal shall survive any foreclosure proceeding, any
foreclosure sale, any delivery of any deed in lieu of foreclosure, and any
release of record of the Security Instrument. Lender may pursue its remedies
against Key Principal without first exhausting its remedies against the Borrower
or the Mortgaged Property. All capitalized terms used but not defined in
this
Acknowledgment shall have the meanings given to such terms in the Security
Instrument. As used in this Acknowledgment, the term "Key Principal" (each
if
more than one) shall mean only those individuals or entities that execute
this
Acknowledgment.
The
obligations of Key Principal shall be performed without demand by Lender
and
shall be unconditional irrespective of the genuineness, validity, or
enforceability of the Note, or any other Loan Document, and without regard
to
any other circumstance which might otherwise constitute a legal or equitable
discharge of a surety or a guarantor. Key Principal hereby waives the benefit
of
all principles or provisions of law, which are or might be in conflict with
the
terms of this Acknowledgment, and agrees that Key Principal's obligations
shall
not be affected by any circumstances which might otherwise constitute a legal
or
equitable discharge of a surety or a guarantor. Key Principal hereby waives
the
benefits of any right of discharge and all other rights under any and all
statutes or other laws relating to guarantors or sureties, to the fullest
extent
permitted by law, diligence in collecting the Indebtedness, presentment,
demand
for payment, protest, all notices with respect to the Note including this
Acknowledgment, which may be required by statute, rule of law or otherwise
to
preserve Lender's rights against Key Principal under this Acknowledgment,
including notice of acceptance, notice of any amendment of the Loan Documents,
notice of the occurrence of any default or Event of Default, notice of intent
to
accelerate, notice of acceleration, notice of dishonor, notice of foreclosure,
notice of protest, notice of the incurring by Borrower of any obligation
or
indebtedness and all rights to require Lender to (a) proceed against Borrower,
(b) proceed against any general partner of Borrower, (c) proceed against
or
exhaust any collateral held by Lender to secure the repayment of the
Indebtedness, or (d) if Borrower is a partnership, pursue any other remedy
it
may have against Borrower, or any general partner of Borrower.
At
any
time without notice to Key Principal, and without affecting the liability
of Key
Principal hereunder, (a) the time for payment of the principal of or interest
on
the Indebtedness may be extended or the Indebtedness may be renewed in whole
or
in part; (b) the time for Borrower's performance of or compliance with any
covenant or agreement contained in the Note, or any other Loan Document,
whether
presently existing or hereinafter entered into, may be extended or such
performance or compliance may be waived; (c) the maturity of the Indebtedness
may be accelerated as provided in the Note or any other Loan Document; (d)
the
Note or any other Loan Document may be modified or amended by Lender and
Borrower in any respect, including an increase in the principal amount; and
(e)
any security for the Indebtedness may be modified, exchanged, surrendered
or
otherwise dealt with or additional security may be pledged or mortgaged for
the
Indebtedness.
Key
Principal acknowledges that Key Principal has received a copy of the Note
and
all other Loan Documents. Neither this Acknowledgment nor any of its provisions
may be waived, modified, amended, discharged, or terminated except by an
agreement in writing signed by the party against which the enforcement of
the
waiver, modification, amendment, discharge, or termination is sought, and
then
only to the extent set forth in that agreement. Key Principal agrees to notify
Lender (in the manner for giving notices provided in Section 31 of the Security
Instrument) of any change of Key Principal's address within 10 Business Days
after such change of address occurs. Any notices to Key Principal shall be
given
in the manner provided in Section 31 of the Security Instrument. Key Principal
agrees to be bound by Paragraphs 20 and 21 of the Note.
THIS
ACKNOWLEDGMENT IS AN INSTRUMENT SEPARATE FROM, AND NOT A PART OF, THE NOTE.
BY
SIGNING THIS ACKNOWLEDGMENT, KEY PRINCIPAL DOES NOT INTEND TO BECOME AN
ACCOMMODATION PARTY TO, OR AN ENDORSER OF, THE NOTE.
[DOCUMENT
EXECUTION OCCURS ON FOLLOWING PAGE]
IN
WITNESS WHEREOF,
Key
Principal has signed and delivered this Acknowledgment under seal or has
caused
this Acknowledgment to be signed and delivered under seal by its duly authorized
representative. Key Principal intends that this Acknowledgment shall be deemed
to be signed and delivered as a sealed instrument.
|
KEY
PRINCIPAL
|
|
|
AMERICAN
HOUSING PROPERTIES L.P.
a
Delaware limited partnership
|
|
|
By: American
Housing Management Company
a
Delaware corporation
General
Partner
By: _/s/
Xxxx Resnick___________________(Seal)
Name: _Paul
Resnik____________________
Title: __Vice
President__________________
|
|
|
Address:
000 Xxxxxxxxx Xxxxxxx Xxxxxx
Xx.
Xxxxxxx, Xxxxxxxx 00000
|
|
|
Employer
ID Number: 00-0000000
|
SCHEDULE
A
PREPAYMENT
PREMIUM
Any
prepayment premium payable under Paragraph 10 of this Note shall be computed
as
follows:
|
(a)
|
If
the prepayment is made at any time after the date of this Note
and before
the Yield Maintenance Period End Date, the prepayment premium shall
be the
greater of:
|
(i) 1%
of the
amount of principal being prepaid; or
(ii) The
product obtained by multiplying:
(A) the
amount of principal being prepaid,
by
|
(B)
|
the
difference obtained by subtracting from the Interest Rate on this
Note the
yield rate (the "Yield
Rate")
on the 9.25% U.S. Treasury Security due February 2016 (the "Specified
U.S. Treasury Security"),
on the twenty-fifth Business Day preceding (x) the Intended Prepayment
Date, or (y) the date Lender accelerates the Loan or otherwise
accepts a
prepayment pursuant to Paragraph 10(a)(3) of this Note, as the
Yield Rate
is reported in The
Wall Street Journal,
|
by
(C) the
present value factor calculated using the following formula:
1
- (1
+ r)-n/12
r
[r
= Yield
Rate
n
= the
number of months remaining between (1) either
of
the following: (x) in
the
case of a voluntary prepayment, the Last Day of the Month during which the
prepayment is made, or (y) in
any other case, the date on which Lender accelerates the unpaid principal
balance of this Note and (2) the Yield Maintenance Period End
Date]
In
the
event that no Yield Rate is published for the Specified U.S. Treasury Security,
then the nearest equivalent non-callable U.S. Treasury Security having a
maturity date closest to the Yield Maintenance Period End Date of this Note
shall be selected at Lender's
discretion. If the publication of such Yield Rates in The
Wall Street Journal
is
discontinued, Lender shall determine such Yield Rates from another source
selected by Lender.
|
(b)
|
If
the prepayment is made on or after the Yield Maintenance Period
End Date
but before the last calendar day of the 4th month prior to the
month in
which the Maturity Date occurs, the prepayment premium shall be
1% of the
amount of principal being prepaid.
|
|
(c)
|
Notwithstanding
the provisions of Paragraph 10(a) of this Note, no prepayment premium
shall be payable with respect to any prepayment made on or after
the last
calendar day of the 4th month prior to the month in which the Maturity
Date occurs.
|
|
____/s/
PR_________________
|
|
Borrower
Initials
|
