EXHIBIT 4-F
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LOAN REPAYMENT AGREEMENT
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This Loan Repayment Agreement ("Agreement") is made this 9th
day of November, 1995 by and between RIVERFRONT OFFICE PARK JOINT
VENTURE, a Massachusetts general partnership ("Maker"), with a
mailing address at c/o Darvel Realty Trust, Xxx Xxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxxxxxxx 00000 ("ROPJV") and TEACHERS INSURANCE
AND ANNUITY ASSOCIATION OF AMERICA, a New York corporation,
having a mailing address at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 ("TIAA").
W I T N E S S E T H:
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WHEREAS, ROPJV is the Maker of Mortgage Note No. 1 dated
August 4, 1983 in the original principal amount of $25,300,000.00
("Note No. 1") with a principal balance on January 1, 1993 of
$24,788,526.00 and on March 1, 1993 of $24,771,715.06, Mortgage
Note No. 2 dated August 4, 1983 in the original principal amount
of $1,200,000.00 ("Note No. 2") with a principal balance on
January 1, 1993 of $1,168,436.67 and on March 1, 1993 of
$1,167,387.83, Mortgage Note No. 3 dated December 19, 1984 in the
original principal amount of $2,700,000.00 ("Note No. 3") with a
principal balance on January 1, 1993 of $2,616,796.40 and on
March 1, 1993 of $2,614,101.49 and Mortgage Note No. 4 dated
August 28, 1990 in the original stated principal amount of
$5,800,000.00 (of which only $5,734,000.00 was advanced) ("Note
No. 4") with a principal balance on January 1, 1993 and on
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March 1, 1993 of $5,734,000.00 (hereinafter Note Xx. 0, Xxxx
Xx. 0, Xxxx Xx. 0 and Note No. 4 are collectively called
"Notes"), each payable to the order of TIAA and (a) secured by a
Security Agreement and Mortgage Deed dated August 4, 1983 from
ROPJV to TIAA recorded with the Middlesex County South Registry
of Deeds in Book 15156, Page 568 and filed with the Middlesex
South Registry District of the Land Court as Document No. 645106
with Certificate of Title No. 136418 with the Middlesex South
Registry District of the Land Court in Book 812, Page 68 as
supplemented by a First Supplement to Security Agreement and
Mortgage Deed dated December 5, 1984, recorded with the said
Registry of Deeds in Book 15927, Page 403 and filed with the said
Registry District of the Land Court as Document No. 673276 and by
a Second Supplement to Security Agreement and Mortgage Deed dated
August 28, 1990, recorded with said Registry of Deeds in
Book 20736, Page 547 and filed as Document No. 828398 with said
Registry District of the Land Court (hereinafter said Security
Agreement and Mortgage Deed as so supplemented is called
"Mortgage") constituting a first mortgage lien upon certain real
property located in the City of Cambridge, Country of Middlesex,
Commonwealth Of Massachusetts as therein more particularly
described (hereinafter called "Mortgaged Premises") and (b) by an
Assignment of Lessor's Interest in lease(s) from ROPHV to TIAA
dated August 4, 1983 duly recorded with the said Registry of
Deeds in Book 15156, Page 592 and filed with the said Registry
District of the Land Court as Document No. 645107 (hereinafter
called "Assignment"),
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WHEREAS, ROPJV is unable to perform its financial
obligations under the Notes, Mortgage and Assignment and ROPJV
desires to restructure its debt to TIAA so as to increase the
total of the presently outstanding principal balances of the
Notes by the amount of accrued and unpaid interest for the year
1993, compounded monthly at the rate of six (6%) per cent per
annum which accrued and unpaid interest so compounded in the
amount of $1,753,452.24 is reconstituted as principal (the total
of the principal balances of the Notes and said reconstituted
interest outstanding from time to time and all amounts payable
with respect thereto are hereinafter referred to as "Loan"), to
modify the maturity date thereof, the interest payable thereunder
and certain other terms relating to the repayment of the debt as
more fully set forth herein and TIAA is willing to restructure
the Loan in accordance with the provisions hereinafter set forth,
WHEREAS, ROPJV is the tenant under a certain Ground Lease
dated September 23, 1981 with the Trustees of Darvel Realty Trust
as Ground Lessor and ROPJV as ground Lessee as amended by
Amendment dated August 4, 1983, and by Amendment No. 2 to Ground
Lease dated as of November 9, 1995 (hereinafter said Ground Lease
as so amended is referred to as "Ground Lease") which Ground
Lease is the subject of a certain Subordination and Waiver of
Rent Agreement dated August 4, 1983, recorded with said Registry
of Deeds in Book 15157, Page 26 and filed with said Registry
District of the Land Court as document No. 645109 and noted on
Certificate of Title No. 136418, and
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WHEREAS, ROPJV and TIAA for their mutual benefit are
desirous that the Loan be repaid in accordance with the terms and
provisions of this Agreement.
NOW THEREFORE, in consideration of the Mortgaged Premises
and of TEN ($10.00) DOLLARS and other good and valuable
consideration paid by the parties hereto each to the other, the
receipt and sufficiency of which is hereby acknowledged, ROPJV
and TIAA for their mutual benefit agree as follows:
(A) ROPJV for value received, promises to pay to TIAA or
order, at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or at such
other place as the holder of the ROPJV Notes may designate in
writing the total amount of THIRTY-FOUR MILLION TWO HUNDRED
EIGHTY-SEVEN THOUSAND TWO HUNDRED FOUR and 38/100
($34,287,204.38) DOLLARS comprised of the total of the presently
outstanding principal balance of Note No. 1 in the amount of
$24,771,715.06, the presently outstanding principal balance of
Note No. 2 in the amount of $1,167,387.83, the presently
outstanding principal balance of Note No. 3 in the amount of
$ 2,614,101.49, and the presently outstanding principal balance of
Note No. 4 in the amount of $5,734,000.00.
(B) ROPJV, for the value received, promises to pay TIAA or
order, at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or such
other place as the holder of the ROPJV Notes and this Agreement
may, designate in writing the amount of $1,753,452.24 which
represents accrued and unpaid interest for 1993 compounded
monthly at the rate of six (6%) per cent per annum in the amount
of $1,753,452.24 is hereby constituted as principal.
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(C) ROPJV and TIAA agree that the amount of $36,040,656.62
being a total of the balances of the Notes in the amount of
$34,287,204.38 and the reconstituted interest in the amount of
$1,753,452.24 shall be repaid as a single consolidated amount in
accordance with the terms and provisions of this Agreement. Any
references hereinafter made to principal or original principal
balance(s) from and after the date of this Agreement shall mean
said $36,040,656.62 and any portions thereof remaining
outstanding from time to time and said principal and all amounts
payable with respect thereto are sometimes referred to as Loan.
(D) ROPJV agrees to pay the Loan in lawful money of the
United States of America with interest thereon in accordance with
the terms and provisions of this Agreement and in furtherance
thereof ROPJV (herein called "Maker") and TIAA (hereinafter
together with all subsequent holders of the Notes called
"Holder") agree as follows:
1. Wherever the term Note hereinafter appears it shall
mean the Notes and this Agreement collectively; wherever the term
Mortgage hereinafter appears, it shall mean the Mortgage as
amended by the Third Supplement To Security Agreement and
Mortgage Deed of even date and delivery herewith by and between
ROPJV and TIAA, duly recorded with the said Registry of Deeds and
filed with the said Registry District of the Land Court; wherever
the term Assignment hereinafter appears, it shall mean the
Assignment as amended by the First Amendment to Assignment of
Lessor's Interest in Lease(s) of even date and delivery herewith
by and between ROPJV and TIAA duly recorded with the said
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Registry of Deeds and filed with the said Registry District of
the Land Court; whatever the term Escrow Agreement hereinafter
appears, it shall mean the Escrow Agreement of even date and
delivery herewith, by and between ROPJV, Xxxxxx Company, Inc.,
and TIAA; and wherever the term Loan Documents hereinafter
appears, it shall mean the Note, Mortgage, Assignment, Escrow
Agreement, the First Amendment to Subordination and Waiver of
Rent Agreement between the holder and Darvel Realty Trust of even
date and delivery herewith (hereinafter called "Rent Waiver
Agreement"), and any other document delivered to TIAA in
connection with the Loan. Wherever the term Mortgaged Premises
is hereinafter used it shall mean the mortgaged premises
described in the Mortgage.
2. The Maker covenants, agrees and confirms that the total
of the outstanding principal balances of the Notes on March 1,
1993 was $34,287,204.38 and the reconstituted principal balances
of the Note as of January 1, 1994 and on the date hereof is
$36,040,656.62 and all said amounts are owed by the Maker to the
Holder without offset, counterclaim or other defense, that the
Maker is the owner of the leasehold estate and every other part
of the Mortgaged Premises, that the Maker shall perform all the
terms and covenants of the Maker in the Mortgage, Assignment and
Escrow Agreement and that there are no offsets, counterclaims or
other defenses to the obligations of Maker under this Agreement,
the Notes, Mortgage, Assignment, Escrow Agreement or any other of
the Loan Documents and that all of the provisions of the Loan
Documents are in full force and effect.
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3. Notwithstanding any inconsistent provisions in the
Notes, the payment terms of Note Xx. 0, Xxxx Xx. 0, Xxxx Xx. 0 and
Note No. 4 are amended and restated as hereinafter set forth in
this Agreement and the principal of the Loan in the amount of
$36,040,656.62 and interest thereon is to be paid as follows:
3.1 Commencing on the first day of January, 1994.
Fixed Interest (as defined below) shall accrue on the principal
balances outstanding hereunder from time to time and said Fixed
Interest shall be paid by the Maker in arrears on the first day
of each month commencing on February 1, 1994 and on the first day
of each month thereafter through and including December 1, 2007.
3.2 The then outstanding principal balance, any
accrued unpaid Fixed Interest, the Minimum Return (as defined
below), the Prepayment/Maturity Amount (as defined below) and any
other amounts payable under the Note, if not sooner paid, shall
be payable on the Maturity Date (as defined below).
3.3 For purposes hereof, the following definitions
shall apply:
(a) APPRAISAL. "Appraisal" means the written report
of an Appraiser which values the Mortgaged Premises at the amount
which a ready and willing buyer would pay to a ready and willing
seller (with neither being compelled to buy or sell) under then
current market conditions to buy the Mortgaged Premises as if it
were free and clear of all liens and debts and, if the Appraisal
is submitted in connection with the payment of the Loan on a
Prepayment Date or on the Maturity Date but not otherwise,
benefitted by the agreement that Basic Rent shall not accrue and
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need not be paid under the Ground Lease until November 30, 2026
(except as otherwise provided in the Rent Waiver Agreement) and
not subject to any diminution of value as a result or a Spill of
Hazardous Waste or Materials as such terms are defined in the
Mortgage.
(b) APPRAISED VALUE. "Appraised Value" means the fair
market value of the Mortgaged Premises obtained by an Appraisal.
(c) APPRAISER. "Appraiser" means an independent
M.A.I. appraiser licensed and having at least ten (10) years of
experience appraising commercial real estate similar to the
Mortgaged Premises in the Boston and Cambridge areas.
(d) APPROVED BUDGET. "Approved Budget" means the
budget for the Mortgaged Premises for a calendar year submitted
by the Maker to the Holder ninety (90) days prior to the
commencement of said calendar year and approved by the Holder
pursuant to the Mortgage in which Approved Budget the Maker and
the Holder agree to the estimated amount of the Cash Flow, Net
Operation Income, Gross Receipts and Operating Expenses of the
Mortgaged Premises for the subject calendar year. No change in
the original Approved Budget for a calendar year made during said
calendar year by agreement of the Maker and the Holder shall
affect or change the Coverage Interest Rate then payable or the
prior agreed estimated Cash Flow amount used to determine the
Coverage Interest Rate then payable.
(e) CASH FLOW. "Cash Flow" means Net Operating Income
less Capital Expenditures, Tenant Improvement Costs, Leasing
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Inducement Amounts and Leasing Commission as those terms are
defined in the Escrow Agreement.
(f) COVERAGE INTEREST RATE. The "Coverage Interest
Rate" shall be that rate of interest per annum which would be
paid by the payment to the Holder in twelve (12) equal monthly
installments during each calendar year commencing in 1998 of the
amount obtained by dividing the estimated Cash Flow set forth in
the original Approved Budget for said calendar year by 1.2,
provided, however, that the Coverage Interest Rate in a calendar
year shall not exceed that rate which would cause the Holder to
have received on a interest payment date a yield having an
Internal Rate of Return of eighteen and one-half (18-1/2%) per cent
per annum, assuming the payment on each interest payment date
during said year of the outstanding principal balance of the Loan
and taking into consideration all previous payments of Fixed
Interest.
(g) DISCOUNTED VALUE. "Discounted Value" means the
amount of a payment under the Note received after January 1, 1993
discounted at a particular rate from date of actual receipt
thereof by the Holder to January 1, 1993.
(h) FIXED INTEREST. "Fixed Interest" means, prior to
January 1, 1998, the amount of interest computed at the Minimum
Fixed Interest Rate and, after December 31, 1997, the greater of
the amount of interest computed at the Minimum Fixed Interest
Rate or the amount of interest computed at the Coverage Interest
Rate.
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(i) GROSS RECEIPTS. "Gross Receipts" means the
aggregate of all the money and the fair-market value of all property
and any other rent, issues, income of whatsoever type and nature
derived from the Mortgage Premises for a calendar year and shall
include all fixed, minimum and guarantee rents, overage rents,
percentage or participation rents, and all rentals and receipts
from written or oral leases, licenses and concessions received
from the Mortgage Premises including all amounts received
pursuant to escalation provisions contained in any and all
occupancy leases (including all contributions by occupancy
tenants or others for real estate taxes, property insurance
expenses and operating expenses), all rent insurance proceeds and
cancellation premiums, and any and all other payments, credits or
offsets received in the nature of rent or additional rent,
parking fees, storage income, deposits or prepayments of rent in
the nature of security which are forfeited by lessees making such
deposits or prepayments, and any and all income and revenue of a
nonrental nature but excluding insurance and condemnation
proceeds to the extent used for repair or restoration and applied
in accordance with the Mortgage and excluding any construction
management fees to the extent paid under any management agreement
previously approved in writing by the Holder, and including
interest and other investment income such as paid on the Reserve
Escrow Account and the Working Capital Escrow Account.
(j) INTERNAL RATE OF RETURN. "Internal Rate of
Return" means that the percentage rate which when applied as of any
date results in the total of the Discounted Value of all payments
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made under the Note (which are in accordance with the terms of the
Note to be used to determine such rate) discounted monthly at
such percentage rate equalling the total of the original
principal balances on January 1, 1993. For the purposes of the
foregoing computation, (i) all advances made pursuant to the Note
shall be considered made on January 1, 1993, except that the
amount of 1,753,452.24 of the accrued and unpaid interest
compounded monthly at six (6%) per cent per annum reconstituted
as principal in accordance with the terms of this Agreement shall
be consideration an advance made on January 1, 1994, and (ii) all
payments made on account of the Note shall be considered made at
such times after January 1, 1993 as such payments were actually
received by Holder.
(k) MATURITY DATE. The "Maturity Date: means
December 31, 2007.
(l) MINIMUM FIXED INTEREST RATE. The "Minimum Fixed
Interest Rate" shall be (i) six (6%) per cent per annum during
the period from and including January 1, 1994 through and
including December 31, 1997, (ii) seven (7%) per cent per annum
during the period from and including January 1, 1998 through and
including December 31, 1999, (iii) eight and one-quarter (8 1/4%)
per cent per annum during the period from and including
January 1, 2000 through and including December 31, 2002, and (iv)
nine (9%) per cent per annum during the period from and including
January 1, 2003 through and including December 31, 2007.
(m) MINIMUM IRR RATE. "Minimum IRR Rate" means an
Internal Rate of Return compounded monthly of not less than nine
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(9%) per cent per annum if the Prepayment Date occurs during each
of the calendar years 1995 through 1997, ten (10%) per cent per
annum if the Prepayment Date occurs during each of the calendar
years 1998 through 2002 or ten and one-half (10 1/2%) per cent per
annum if the Prepayment Date occurs during each of the calendar
years 2003 through 2007 and on the Maturity Date.
(n) MINIMUM RETURN. "Minimum Return" means the amount
which, when paid to the Holder and added to prior payments of
principal and Fixed Interest made by the Maker under the Note,
will cause the Holder to have received on a Prepayment Date or
the Maturity Date a yield having an Internal Rate of Return equal
to the Minimum IRR Rate effective on such Prepayment Date or the
Maturity Date. The Residual Amount payable on a Prepayment Date
or on the Maturity Date shall not be used in calculating the
Minimum Return.
(o) NET OPERATING INCOME. "Net Operating Income"
means Gross Receipts less Operating Expenses.
(p) OPERATING EXPENSES. "Operating Expenses" means
amounts paid by Maker in a calendar year in the ordinary course
of the maintenance, operation and use of the Mortgaged Premises
in accordance with the amounts set forth in the line item
categories in the Approved Budget, including (i) payroll, fringe
benefits and statutory payroll taxes, (ii) charges for
electricity, gas, telephone, water, sewer, garbage, laundry,
extermination, elevator, alarm system for common areas and
security guard services and other utilities required under tenant
leases or by statute, (iii) charges for fuel and reasonable
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inventory purchased, (iv) sales, business and real estate taxes
and assessments, (v) premiums for insurance, (vi) costs of
replacements (excluding Tenant Improvement Costs and Capital
Expenditures, as defined in the Escrow Agreement), repairs,
maintenance and supplies, (vii) charges for promotion and
advertising, (viii) management fees of up to three and one-half
(3 1/2%) of Gross Receipts from the Mortgaged Premises (inclusive of
all off-site overhead charges) plus reimbursement for reasonable
and customary direct on-site expenses of the manager, but only to
the extent included in the Approved Budget for any fiscal year,
(ix) charges for audited financial statements delivered to Holder
pursuant to the Mortgage, (x) reasonable legal fees and expenses
incurred in connection with (A) the drafting of new leases and
lease amendments, (B) actions to collect rents owing and (C) tax
abatement proceedings, and (xi) ground rent to the extent payable
in accordance with the provisions of the Rent Waiver Agreement.
The following shall not be deemed to be Operating Expenses: (1)
payments of principal and interest on any indebtedness, including
the Note, (2) refunds to tenants of security deposits, (3)
payment for Capital Expenditures, Tenant Improvements Costs,
Leasing Inducement Amounts and Leasing Commissions as those terms
are defined in the Escrow Agreement, unless previously consented
to in writing by Holder, (4) depreciation or other non-cash
items, (5) prepaid expenses which are not customarily prepaid in
the ordinary course of business, (6) management fees payable in
excess of those approved in subparagraph (viii), above, (7)
general overhead expenses in connection with the operation of the
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Mortgaged Premises, (8) costs of Appraisals (except as they
relate to bona-fide tax abatement proceedings), (9) any escrow or
reserve funds established by Holder in connection with the
Mortgaged Premises (including, without limitation, the Reserve
Escrow Account and the Working Capital Reserve Account, (10)
audit fees described in paragraph 67(c) of the Mortgage, and (11)
ground rent, except to the extent said rent is permitted to be
paid under the Rent Waiver Agreement.
(q) PREPAYMENT/MATURITY AMOUNT. "Prepayment/Maturity
Amount" means the sum of the Minimum Return and the Residual
Amount (as defined in paragraph 4.1 hereof).
(r) PREPAYMENT DATE. "Prepayment Date" means the date
of payment of all amounts due hereunder prior to the Maturity
Date, whether by voluntary prepayment or other wise and, in the
event of a foreclosure, the Prepayment Date shall be the date of
the foreclosure sale, whether the Holder (or a third party)
successfully bids in the Mortgaged Premises at such sale.
(s) RESERVE ESCROW ACCOUNT. "Reserve Escrow Account"
means the separate segregated account for the exclusive use and
benefit of Mortgaged Premises established pursuant to the Escrow
Agreement as the Reserve Escrow Account.
(t) WORKING CAPITAL RESERVE ACCOUNT. "Working Capital
Reserve Account" means the separate segregated account for the
exclusive use and benefit of the Mortgaged Premises established
pursuant to the Escrow Agreement as the Working Capital Reserve
Account.
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(u) YIELD ACHIEVEMENT VALUE. "Yield Achievement
Value" means that the Appraised Value of the Mortgaged Premises
is an amount which, assuming prepayment of the Loan, would result
in the sums being payable to the Holder on said assumed
Prepayment Date under the Note resulting in a yield to the Holder
having at lease an Internal Rate of Return at the Minimum IRR
Rate.
3.4 All the Net Operating Income remaining after the
payment to the Holder of Fixed Interest computed at the Minimum
Fixed Interest Rate or Coverage Interest Rate, as the case may
be, shall be paid by Maker to the Escrow Agent to be held and
disbursed by the Escrow Agent pursuant to the terms and
provisions of the Escrow Agreement.
3.5 Commencing in the calendar year 1997 and
thereafter during the term of the Loan, in the event that the
amount in the Reserve Escrow Account exceeds the greater of
$1,500,000.00 or such higher sum which is estimated as needed for
the Mortgaged Premises in the Holder's reasonable opinion based
on current financial projections (such greater sum being
hereinafter called "Reserve Requirement") the Maker shall pay
directly to the Holder all Net Income in excess of
Fixed Interest payments made under the Note which payments shall
be applied to reduce the principal balance of the Loan without
penalty or premium and which payments to the Holder shall
continue so long as the Reserve Escrow Account amount exceeds the
amount of the Reserve Requirement. Whatever the balance of the
Reserve Escrow Account exceeds the Reserve Requirement, the
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Holder may require any excess over the Reserve Requirement to be
paid by the Escrow Agent to the Holder to reduce the principal
balance of the Loan (without penalty or premium).
3.6 If the Maker delivers to the Holder evidence
satisfactory to the Holder in Holder's sole and absolute discretion
that the Mortgaged Premises on a particular date have a Yield
Achievement Value on such date, then thereafter the payment by
the Maker each month of any Net Operating Income remaining after
the payments of the Fixed Interest at the Minimum Fixed Interest Rate
or Coverage Interest Rate, as the case may be, either under
paragraph 3.4 to the Escrow Agent or under paragraph 3.5 to the
Holder directly shall be suspended and such amounts shall be
retained by the Maker, but only so long as in Holder's sole
opinion the Mortgaged Premises have a Yield Achievement Value.
3.7 If the Maker believes the Mortgaged Premises have
a Yield Achievement Value and desires that the payments under
paragraph 3.4 and paragraph 3.5 be suspended, the Maker may cause
to be delivered to the Holder an Appraisal of the Mortgaged
Premises at any time with a written notice to the holder that it
appears to the Maker that the Mortgaged Premises have attained a
Yield Achievement Value and the Maker desires that the monthly
payments under paragraph 3.4 and paragraph 3.5 be suspended.
Thereafter so long as the payments under paragraph 3.4 or
paragraph 3.5 are suspended, the Maker shall cause to be
delivered to the Holder on October 1 of each calendar year an
Appraisal of the Mortgaged Premises (except that such Appraisal
may be so-called less formal "desk appraisal" in each calendar
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year except the years 1997, 1999, 2002 and 2007, provided said
"desk appraisal" is in all respects satisfactory to the Holder in
Holder's sole and absolute discretion). In addition, the Holder
may obtain at Maker's expense out of Gross Receipts (with the
cost so paid to be added to the Approved Budget) an Appraisal of
the Mortgaged Premises whenever the Holder desires to ascertain
whether the Mortgaged Premises continue to have a Yield
Achievement Value.
3.8 In the event that, subsequent to the suspension of
payments, the Mortgaged Premises at any time thereafter no longer
have a Yield Achievement Value then payments to the Escrow Agent
as described in paragraphs 3.4 and 3.5 shall immediately commence
again to be made by the Maker either to the Escrow Agent or to
the Holder as the case may be.
3.9 All amounts of Net Operating Income in excess of
Fixed Interest not paid under the provision of paragraph 3.4 to
the Escrow Agent or under paragraph 3.5 to the Holder ("Excess
NOI") shall be used by the Maker for the payment of Operating
Expenses, Shortfalls, Tenant Improvement Costs, Capital
Expenditures, Leasing Commissions or Lease Inducement Amounts all
as defined in the Escrow Agreement before drawing amounts for the
payment of such items from the Escrow Accounts as defined in the
Escrow Agreement. It is the intention of the Maker and the
Holder that the Excess NOI be available for use for the Mortgaged
Premises and the Maker agrees that no distribution (as a
Dividend, return of capital or the like) of Excess NOI shall be
made by the Maker.
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4. The Maker may pay the principal indebtedness in full
only, but not in part together with all unpaid Fixed Interest and
the Prepayment/Maturity Amount on any installment due date, upon
giving the Holder of the Note one hundred twenty (120) days prior
written notice of its intention to so prepay. In addition to the
Fixed Interest, Maker hereby promises, covenants and agrees to
pay to Holder on the Prepayment Date or on the Maturity Date the
Prepayment/Maturity Amount which shall mean an amount equal to
the sum of the Minimum Return, if any, and the Residual Amount
(as defined below); provided, however, the amount of the
Prepayment/Maturity Amount which shall exceed that amount which
would cause the Holder on the Prepayment Date or on the Maturity
Date to have received a yield at an Internal Rate of Return on
the total principal balances of the Notes on January 1, 1993
increased by the amount of $1,753,452.24 advanced as of
January 1, 1994 and thereafter outstanding from time to time in
excess of twenty-four (24%) per cent, compounded monthly.
4.1 RESIDUAL AMOUNT. For the purposes
hereof, "Residual Amount" shall mean an amount equal to fifty
percent (50%) of the sum of (i) the amount by which the sum of
the amounts held in the Reserve Escrow Account and the Working
Capital Reserve Account on the Prepayment Date or on the Maturity
Date exceeds any portion thereof used to pay the Minimum Return
and (ii) the greater of (A) the sale proceeds from the actual
sale of the Mortgaged Premises, after deducting only (and then
only to the extent such sums are actually paid to Holder or, in
the case of commissions and closing costs, to a non-affiliated
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third party entitled thereto) the then outstanding principal
balance of the Note, the then unpaid Fixed Interest on the Note,
the Minimum Return, if any, and any third-party brokerage
commissions paid by Maker in connection with such sale and other
customary closing costs paid by Maker, but only to the extent all
such commissions and all such closing costs do not exceed three
percent (3%) of such sale proceeds, or (B) the Appraised Value
(less three percent (3%) for a closing cost adjustment and) after
deducting only (and then only to the extent such sums are
actually paid to Holder) the then outstanding principal balance
of the Note, the then unpaid Fixed Interest on the Note, and the
Minimum Return, if any. The greater of the amount determined in
(ii) (A) or (ii) (B) of the immediately preceding sentence is
hereinafter called "Capital Proceeds".
4.2 In order to determine the Residual Amount to be
paid to Holder or to determine that no Residual Amount is payable
hereunder, the Maker shall forward the following document to the
Holder, either simultaneously with the sending of the notice of
intention to prepay prior to one hundred twenty (120) days of the
Prepayment Date is hereinabove provided, or within one hundred
twenty (120) days of the Maturity Date, and as a condition
precedent to such notice being deemed to be effective, or within
thirty (30) days of acceleration of maturity after default: (a)
an Appraisal of the Mortgaged Premises prepared by an Appraiser;
(b) if the Mortgaged Premises are being sold to a third party
simultaneously with such payment, the contract of sale, real
estate brokerage agreement (if deduction for a brokerage
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commission is being claimed), and a statement of all estimated
closing costs, with supporting data, for which deductions are
being claimed; and if the sale is not for a one hundred (100%)
per cent interest in the Mortgaged Premises, then the sales price
set forth in the contract of sale shall be projected as if 100%
of the Mortgaged Premises were being sold and such projection
shall be used for determining the amount due the Holder
hereunder; additionally, the sales price for the purpose of
determining the amount due the Holder hereunder shall include the
amount of all cash payments, deferred payments, debts assumed
(other than the debt evidenced by the Note which may not be
assumed) and the value of all assets, securities, interest and
other consideration received or receivable in connection with
such sale; (c) a current rent roll of the Mortgaged Premises,
supporting leases not previously furnished to the Holder, and a
certified statement of income and expenses for the twelve month
period immediately preceding the date of such notice setting
forth all the information necessary to do an Appraisal of the
Mortgaged Premises; a statement of all other estimated closing
costs, with supporting data, for which deductions are
anticipated; and (d) a true and correct statement from the Maker
calculating all amounts due the Holder hereunder. A statement of
final closing costs, with supporting data, shall be furnished at
the time of payment of the Prepayment/Maturity Amount.
4.3 The Maker shall promptly furnish the Holder with
all additional information that Holder may reasonably request.
If the Holder does not agree with any of the conclusions,
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calculations, computations, valuations or other information
supplied the Holder, the Holder shall notify the Maker in writing
within ninety (90) days of Maker's submissions. If such
disagreement is over whether or not the sale is a bona fide arms
length transaction limited to the Mortgaged Premises and
reflecting full value, or the amount of the Appraised Value of
the Mortgaged Premises, the Holder shall furnish the Maker an
Appraisal in conformity to the standards imposed on the Maker
with respect to an appraisal. If the two Appraisals differ by
ten (10%) per cent or less the Appraised Value of the Mortgaged
Premises for the purposes of the Note shall be the average
valuation of the two Appraisals. If the difference is greater
than ten (10%) per cent, either party shall have the right to
require that a third independent Appraiser, mutually satisfactory
to both the Maker or the Holder, be selected to appraise the
Mortgaged Premises. Such third Appraiser shall render his report
within thirty (30) days of appointment, which report must not set
a valuation lower than the lowest valuation of the Appraisals
previously submitted nor higher than the highest valuation of the
appraisals previously submitted. The valuations set forth in all
three Appraisals shall be aggregated and the Appraised Value of
the Mortgaged Premises shall be deemed to be the average of all
such appraisals. Each party shall pay its own Appraiser, and the
parties shall each pay one-half of the cost of any third
Appraiser. If the Maker does not in the time required supply an
Appraisal from an Appraiser meeting the qualifications in item
(a) of the immediate preceding paragraph, then the Holder may
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obtain such an Appraisal and the Maker agrees than any such
Appraisal obtained by and satisfactory to the Holder shall be the
Appraisal used in determining the amounts due the Holder
hereunder. If the privilege to prepay is not exercised, the then
outstanding principal balance together with any unpaid Fixed
Interest accrued thereon and together with the Minimum Return and
the Prepayment/Maturity Amount shall be paid on the Maturity
Date.
4.4 Notwithstanding the foregoing, the Holder may,
after acceleration of payment of the principal balance after
default, immediately commence all foreclosure activities and
process the same to sale without waiting for the submission of an
Appraisal from the Maker and without obtaining an Appraisal for
its own benefit, unless it so chooses. In such event the Holder
shall obtain the Prepayment/Maturity Amount from the proceeds of
a foreclosure sale.
4.5 Notwithstanding anything herein to the contrary,
Holder's Appraised Value shall in all events be used for purposes
of calculating the Residual Amount if the Residual Amount is
payable as a result of acceleration of maturity after default.
4.6 In the event that the Capital Proceeds are such
that when determined in accordance with the provisions of the
Note, they are insufficient to fully pay the Minimum Return, all
sums in the Reserve Escrow Account and the Working Capital
Reserve Account shall be applied towards payment of the Minimum
Return.
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5. In addition to the foregoing, if the Maker shall fail
to make any payment of principal or Fixed Interest or the
Prepayment/Maturity Amount, including any Minimum Return,
Prepayment/Maturity Amount and all other payments due on the
Maturity Date, a late charge by way of damages shall be
immediately due and payable. The Maker recognizes that any
default by the Maker in making the payments when due herein and
in the Mortgage securing payment hereof will result in the Holder
incurring additional expense in servicing the loan, in loss to
Holder of the use of the money due and in frustration to Holder
in meeting its loan commitments. The maker agrees that, if for
any reason the Maker fails to pay the amounts due under the note
or under the Mortgage when due, the holder shall be entitled to
damages for the detriment caused thereby, but that it is
extremely difficult and impractical to ascertain the extent of
such damages. The Maker therefore agrees that a sum equal to
five ($.05) cents for one each ($1.00) dollar of each payment
which becomes delinquent is a reasonable estimate of the said
damages to the Holder, which sum the Maker agrees to pay on
demand.
6. That upon default by the Maker and following the
acceleration of maturity as provided herein, a tender of payment
of the amount necessary to satisfy the entire indebtedness
evidenced hereby, made at any time prior to foreclosure sale
(including sale under any power of sale hereunder) by the Maker,
its successors assigns, or by anyone on behalf of the Maker,
its successors or assigns, shall be deemed to be a voluntary
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prepayment hereunder and such prepayment will therefore include
the Prepayment/Maturity Amount required under the payment terms
recited above.
7. Maker hereby further specifically acknowledges and
agrees that (a) the Prepayment/Maturity Amount is reasonable in
amount, (b) the Prepayment/Maturity Amount shall be paid without
prejudice to the right of Holder to collect any other amounts
provided to be paid hereunder or under the Mortgage or any other
document evidencing or securing the Loan evidenced hereby, and
(c) the Holder shall be entitled to bid all or a portion of the
Prepayment/Maturity Amount, at any foreclosure sale under the
Mortgage. Maker hereby acknowledges and agrees that Holder would
not lend to Maker the Loan evidenced by the Note without Maker's
agreement to pay Holder the Prepayment/Maturity Amount, upon the
satisfaction of all or any portion of the principal indebtedness
evidenced hereby on a Prepayment Date or on the Maturity Date or
following the acceleration of the Maturity Date hereof by reason
of a default hereunder, including, without limitation, a default
arising from the conveyance of any right, title or interest in
the Mortgaged Premises encumbered by the Mortgage in violation of
the Mortgage.
8. All agreements between the Maker and the Holder hereof
are hereby expressly limited so that in no event shall the amount
paid or agreed to be paid to the Holder hereof as interest
(whether Fixed Interest, Prepayment/Maturity Amount or otherwise)
hereunder exceed the highest lawful rate now permissible under
applicable usury laws. If the Holder of the Note would, but for
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the operation of this paragraph, ever receive as interest an
amount which would exceed the highest lawful rate which Holder
could lawfully receive as interest, such amount which would be
excessive interest shall be applied to the reduction of the
unpaid principal balance due hereunder and not to the payment of
interest; all payments made thereafter shall be appropriately
applied to interest and principal to give effect to the highest
lawful rate which Holder could lawfully receive as interest and
after such application, any excess shall be immediately refunded
to the Maker. This provision shall control every other provision
of all agreements between the Maker and the Holder hereof.
9. If during the term of the Note the maximum rate of
interest, if any, now permitted by law for this transaction to be
lawfully charged should be increased, then for so long as such
increase is in effect, the applicable maximum rate permitted to
be charged as referred to in the paragraph immediately preceding
shall be deemed to be such increased rate. If such maximum rate
of interest, if any, now permitted by law to be lawfully charged
for this transaction should be deleted so that there would be no
such maximum rate, then for purposes of this Loan, there shall
thereafter be no maximum rate limiting the amount that can be
charged.
10. Notwithstanding any provisions in the Note or in the
Mortgage securing the Note to the contrary, Holder hereof
covenants and agrees with Maker that in the event the Holder
shall, at any time, take action to enforce the collection of the
indebtedness evidenced by the Note and secured by the Mortgage or
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otherwise arising hereunder, it shall first proceed to foreclose
the Mortgage (including foreclosure pursuant to the exercise of
any power of sale in the Mortgage provided) instead of
instituting suit upon the Note and if, as a result of such
foreclosure and the sale of the property described herein, a
lesser sum is realized therefrom than the amount then due and
owing hereunder, the Holder hereof shall never institute any
action, suit, claim or demand in law or in equity against the
maker for or on account of such deficiency; provided, however,
that nothing in this paragraph contained will in any way affect
or impair the lien of the Mortgage securing the Note or any
liability for any intentional misrepresentation or intentionally
erroneous warranty of title made therein by Maker, all of which
will remain in full force and inure to the benefit of Holder
hereof and to any insurer of title of the real estate encumbered
by said Mortgage. Neither the negative capital account of any
partner of Maker nor any obligation of any partner of Maker to
restore a negative capital account or to contribute capital to
Maker shall at any time be deemed to be an asset of Maker, and
Holder shall have any right to collect, enforce or proceed
against or with respect to any such negative capital account or
obligations; provided, however, that Holder and its successors
and assigns shall have the right to collect, enforce, or proceed
against or with respect to any such negative capital account or
partner's obligation to restore or contribute in order to recover
any sums due to Holder in connection with the misapplication of
rents under the Assignment. Notwithstanding the foregoing, no
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General Partner of Carlyle Real Estate Limited Partnership-XI, or
any partner thereof, or any officer, director, shareholder,
principal, trustee or advisor of Carlyle Real Estate Limited
Partnership-XI or of any partner thereof or of Darvel Realty
Trust shall have any liability under this Note, the Mortgage, the
Assignment, the Escrow Agreement or any other of the Loan
Documents.
11. The name Darvel Realty Trust is the designation of the
trustees under a Declaration of Trust dated July 24, 1970, and
recorded with the Middlesex South District Registry of Deeds on
July 24, 1970 in Book 11865 at Page 580, as amended. By
acceptance of the Note, Holder hereby agrees, notwithstanding
anything contained in the Note or the Mortgage or any other
document securing the Note to the contrary, in accordance with
such Declaration of Trust, to look solely to the property of
Darvel Realty Trust for the enforcement of any claims against
Darvel Realty Trust and that no trustee, officer, agent or
shareholder of Darvel Realty Trust shall be personally liable for
obligations of Darvel Realty Trust hereunder and the respective
properties of such individuals shall not be subject to claims of
Holder in respect of any liability to Holder of Darvel Realty
Trust hereunder.
12. The Maker and endorses hereof and all other who may
become liable for all or any part of the obligation of the Note
agree hereby to be jointly and severally bound and jointly and
severally waive and renounce any and all homestead and exemption
rights and the benefit of all valuation and appraisement
-27-
privileges as against this debt or any renewal or extension
thereof, waive, demand, protest, notice of nonpayment and any and
all lack of diligence or delays in collection or enforcement
hereof waive the right to plead any and all statutes of
limitation as a defense to any demand on the Note or under the
Mortgage and expressly consent to any extension of time, release
of any party liable for this obligation, release of any of the
security of the Note, acceptance of other security therefor, or
any other indulgence or forbearance whatsoever. Any such
extension, release, indulgence or forbearance may be made without
in any way affecting the personal liability of any party.
13. If default be made in the payment of any installment of
principal and/or Fixed Interest or any other sums when due under
the Note, which default shall continue for five (5) days without
notice, or if a default be made in the performance of any of the
other terms, covenants, conditions or warranties contained in the
Note or any of the terms, covenants, conditions or warranties
contained in the Mortgage or in the Assignment or in the Escrow
Agreement or in any other Loan Document which continues
uncorrected for fifteen (15) days, unless maker has commenced to
cure same within said fifteen (15) day period and thereafter
continues to diligently prosecute the cure thereof, then, at the
option of the Holder of the Note, the entire principal sum
evidenced hereby and secured by said Mortgage, together with
interest accrued thereon and all other sums then outstanding
under the Note, including without limitation unpaid Fixed
Interest and Prepayment/Maturity Amount, or the Mortgage, or
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the Assignment, without notice, shall immediately become due and
payable. Failure to exercise this option shall not constitute a
waiver of the right to exercise the same in the event of any
subsequent default.
14. In the event the Maker fails to pay the entire unpaid
principal balance together with all accrued unpaid interest
including accrued Fixed Interest and the Prepayment/Maturity
Amount and other charges, if any, upon the Maturity Date, or upon
the earlier acceleration thereof, such outstanding principal
balance together with any accrued but unpaid interest including
Fixed Interest and the Prepayment/Maturity Amount and other
charges, if any, shall bear interest commencing on the date of
such default and continuing for so long as such default
continues, at the rate of twenty (20%) per cent per annum (the
"Default Rate"), but not to exceed the maximum legal rate
allowable, such interest to be compounded annually.
15. If any suit or action is instituted or an attorney is
employed to collect the Note or the Loan or any part thereof, the
Maker promises and agrees to pay all costs of collection
including reasonable attorney's fees.
16. During the existence of any default or deficiency under
the terms of the Note or under the terms of any instrument
executed or to be executed as security for the payment hereof,
the Holder is expressly authorized to apply all payments made on
the Note to the payment of such part of any delinquency as it may
elect.
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17. The remedies of the Holder hereof, as provided herein
or in the Mortgage or any other instrument securing the Note,
shall be cumulative and concurrent, and may be pursued
singularly, successively or together, at the sole discretion of
the Holder hereof, and may be exercised as often as occasion
therefor shall arise. No act of omission or commission of the
Holder, including specifically any failure to exercise any right,
remedy or recourse, shall be deemed to be a waiver or release of
the same, such waiver or release to be effected only through a
written document executed by the Holder and then only to the
extent specifically recited therein. A waiver or release with
reference to any one event shall not be construed as continuing,
as a bar to, or as a waiver or release of, any subsequent right,
remedy or recourse as to a subsequent event.
18. Maker understands that in making this Loan, Holder is
relying to a material extent upon the business expertise and net
worth of Maker and upon the continuing interest which Maker has
in the Mortgaged Premises. Accordingly, in the event Maker
shall, directly or indirectly, voluntarily or involuntarily, (i)
sell, assign, transfer or dispose of all or any part of its
interest in the Mortgaged Premises, or (ii) further encumber, or
suffer to exist, any lien, other than the lien of the Mortgage
securing the Note against all or any part of, or any interest in
the Mortgaged Premises, or in the event the composition of the
Maker is changed (including without limitation, the transfer of
any beneficial interest in Maker or portion of such interest or
the change in control or composition of any beneficiary of Maker
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except for a transfer of less than five (5%) per cent over the
term of the loan of limited partnership interest among limited
partners of constituent partners of Maker or a transfer of a
limited partnership interest as a consequence of the death of a
limited partner) then, the Holder may at any time thereafter, at
its option, declare the unpaid principal of the Note and all
accrued Fixed Interest and the Prepayment/Maturity Amount thereon
immediately due and payable. The transfer of an ownership
interest except as set forth above in the Maker shall be deemed a
sale of the Mortgaged Premises for the purposes of this
paragraph. Notwithstanding the foregoing, Maker shall have the
right to sell, assign, transfer or dispose of the Mortgaged
Premises to a purchaser, assignee or transferee who (i) has a net
worth in excess $25,000,000.00 and (ii) in the reasonable
determination of Holder, has a favorable reputation and is
experienced in the operation, management and ownership of real
estate similar to the mortgaged Premises.
Notwithstanding anything in this paragraph 18 to the
contrary, limited partnership interests in Carlyle Real Estate
Limited Partnership-XI ("Carlyle") which are presently owned by
an entity (which may include a corporation, partnership or
trust), that is neither JMB Realty Corporation ("JMB"), nor a JMB
Affiliate (as hereinafter defined), nor directly or indirectly
controlled or under common control with JMB or a JMB Affiliate,
may be sold, transferred or assigned without Holder's consent,
and, further, the partnership interest of Carlyle in the Maker
held directly or indirectly by JMB or by a JMB Affiliate may be
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sold, transferred or assigned without Holder's consent to any
existing general partner of Riverfront Office Park Associates,
the Massachusetts limited partnership which together with Carlyle
are the general partners of the Maker. A "JMB Affiliate" means
(a) any entity (which may include a corporation, partnership or
trust) that is managed or directed on the basis of ownership of
economic interest and whose controlling ownership interests are
held by (i) JMB, (ii) persons or entities who are shareholders of
JMB ("JMB Shareholders") or (iii) a primary, secondary or
tertiary subsidiary of JMB or JMB Shareholders ("JMB
Subsidiary"); (B) any general or limited partnership having as
its managing general partner or partners (i) JMB, (ii) JMB
Shareholders, or (iii) JMB Subsidiary; (c) any real estate
investment trust, foundation, common fund or investor account for
which JMB, JMB Shareholders or JMB Subsidiary acts as the
investment manager or advisor; (d) any publicly-traded real
estate investment trust sponsored by, or in which of the time of
offering, more than ten (10%) per cent of the shares or units are
owned by, JMB, JMB Shareholders or JMB Subsidiary.
19. Whenever used, the singular number shall include the
plural, the plural the singular, the word "Mortgagor" shall mean
"Mortgagor and/or any subsequent owner or owners of the Mortgaged
Premises or any part thereof or interest therein," the word
"Mortgagee" shall mean "Mortgagee or any subsequent Holder of the
Mortgage," and the words "Maker" and "Holder" shall include their
respective successors and assigns. The Note is to be construed
according to the laws of the Commonwealth of Massachusetts.
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20. The Maker hereby irrevocably and unconditionally (a)
submits to personal jurisdiction in the Commonwealth of
Massachusetts over any suit, action or proceeding arising out of
or relating to the Loan Documents, and (b) waives any and all
personal rights under the laws of any state (i) to the right, if
any, to trial by jury, (ii) to object to jurisdiction within the
Commonwealth of Massachusetts or venue in any particular forum
within the Commonwealth of Massachusetts, and (iii) to the right,
if any, to claim or recover any special, exemplary, punitive or
consequential damages or any damages other than actual damages.
The Maker agrees that, in addition to any methods of service of
process provided for under applicable law, all services or process
in any such suit, action or proceeding may be made by certified
or registered mail, return receipt requested, directed to the
Maker at the address set forth above, and service so made shall
be complete five (5) days after the same shall be so mailed.
Nothing contained herein, however, shall prevent the Holder from
bringing any suit, action or proceeding or exercising any rights
against any security and against Maker, and against any property
of Maker, in any other state. Initiating such suit, action or
proceeding or taking such action in any state shall in no event
constitute a waiver of the agreement contained herein that the
laws of the Commonwealth of Massachusetts shall govern the rights
and obligations of the Maker and the Holder hereunder or the
submission herein made by the Maker to personal jurisdiction
within the Commonwealth of Massachusetts.
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EXECUTED as a sealed instrument as of the day and year first
above written.
WITNESS: RIVERFRONT OFFICE PARK JOINT
VENTURE, a Massachusetts general
partnership
By: RIVERFRONT OFFICE PARK
ASSOCIATES, a Massachusetts
limited partnership and a
general partner of Riverfront
Office Park Joint Venture
By: Darvel Realty Trust, a
Massachusetts Business
Trust and General Partner
Of Riverfront Office Park
Associates
By:
Xxxxxxx X. Xxxxxxxx,
Vice President and a
Trustee of Darvel Realty
Trust
By: Xxxxxxxx-Riverfront
Associates, a
Massachusetts limited
partnership and General
Partner of Riverfront
Office Park Associates
By
Xxxxx Xxxxxxxxx,
Managing General Partner
By: Cod-Riverfront
Associates, a
Massachusetts partnership
and General Partner of
Riverfront Office Park
Associates
By
Xxxxxxxx X. Xxxxxxx,
General Partner
and
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By: CARLYLE REAL ESTATE LIMITED
PARTNERSHIP-XI, an Illinois
limited partnership and a
general partner of Riverfront
Office Park Joint Venture
By: JMB Realty Corporation, a
Delaware Corporation,
Corporate General Partner
of Carlyle Real Estate
Limited Partnership-XI
By
Vice President
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