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DEED TO SECURE DEBT AND SECURITY AGREEMENT
THIS DEED TO SECURE DEBT AND SECURITY AGREEMENT (the "Security Deed"),
executed this 1st day of June, 1998, by XXXXXXX PROPERTIES RESIDENTIAL, L.P., a
Georgia limited partnership (the "Borrower"), having its principal office at
0000 Xxxxxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000. Said Security Deed is
being given to secure the payment of a note of even date herewith payable to the
order of NATIONWIDE LIFE INSURANCE COMPANY, an Ohio corporation, having its
principal office at Xxx Xxxxxxxxxx Xxxxx, Xxxxxxxx, Xxxx 00000-0000 or at such
other place either within or without the State of Ohio, as Lender may from time
to time designate, and any subsequent holder(s) hereof, (the "Lender").
WITNESSETH
WHEREAS, the Borrower is justly indebted to the Lender in the sum of
EIGHT MILLION FOUR HUNDRED THOUSAND AND NO/100 DOLLARS ($8,400,000.00), with
interest thereon, as set forth in a certain Real Estate Note of even date
herewith payable to Nationwide Life Insurance Company (said Real Estate Note is
hereinafter referred to as the "Note"), which Note shall be due and payable on
or before June 15, 2008; and
WHEREAS, the Lender, as a condition precedent to the extension of credit
and the making of the loan evidenced by the Note, has required that the Borrower
provide Lender with security for the repayment of the indebtedness evidenced by
the Note as well as for the performance, observance and discharge by the
Borrower of the various covenants, conditions and agreements made by the
Borrower to, with, in favor of and for the benefit of Lender with respect to
said indebtedness and such security;
NOW THEREFORE, in consideration of and in order to secure the repayment
of the indebtedness evidenced and represented by the Note, together with
interest on such indebtedness, as well as the payment of all other sums of money
secured hereby, as hereinafter provided; and to secure the observance,
performance and discharge by the Borrower of all covenants, conditions and
agreements set forth in the Note, this Security Deed and in all other documents
and instruments executed and delivered by the Borrower to and in favor of Lender
for the purpose of further securing the repayment of the indebtedness evidenced
and represented by the Note; and in order to charge the properties, interests
and rights hereinafter described with such payment, observance, performance and
discharge; and in consideration of the sum of one dollar paid by Lender to
Borrower and other good and valuable considerations, the receipt and sufficiency
of which are hereby acknowledged, the Borrower does hereby grant, bargain, sell,
alien, remise, release, convey, assign, transfer, pledge, deliver, set over,
hypothecate, warrant and confirm unto Lender, its successors and assigns
forever, all of Borrower's right, title and interest in and to the following
described properties, rights and interests and all replacements of,
substitutions for, and additions thereto (all of which are hereinafter together
referred to as the "Property"), to wit:
ALL THAT certain piece, parcel or tract of land or real property of
which the Borrower is now seized and in actual or constructive possession,
situate in Gwinnett County, Georgia more
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particularly described on Exhibit "A" attached hereto and by this reference made
a part hereof (hereinafter referred to as the "Real Property");
TOGETHER WITH all buildings, structures and other improvements of any
kind, nature or description now or hereafter erected, constructed, placed or
located upon said Real Property (which buildings, structures and other
improvements are hereinafter sometimes together referred to as the
"Improvements"), including, without limitation, any and all additions to,
substitutions for or replacements of such Improvements;
TOGETHER WITH all minerals, royalties, gas rights, water, water rights,
water stock, flowers, shrubs, lawn plants, crops, trees, timber and other
emblements now or hereafter located on, under or above all or any part of the
Real Property;
TOGETHER WITH all and singular, the tenements, hereditaments, strips and
gores, rights-of-way, easements, privileges and other appurtenances now or
hereafter belonging or in any way appertaining to the Real Property, including,
without limitation, all right, title and interest of the Borrower in any
after-acquired right, title, interest, remainder or reversion, in and to the
beds of any ways, streets, avenues, roads, alleys, passages and public places,
open or proposed, in front of, running through, adjoining or adjacent to said
Real Property (hereinafter sometimes together referred to as "Appurtenances");
TOGETHER WITH any and all leases, contracts, rents, royalties, issues,
revenues, profits, proceeds, income and other benefits, including accounts
receivable, of, accruing to or derived from said Real Property, Improvements and
Appurtenances and any business or enterprise presently situated or hereafter
operated thereon and therewith (hereinafter sometimes together referred to as
the "Rents");
TOGETHER WITH, any and all awards or payments, including interest
thereon, and the right to receive the same, as a result of (a) the exercise of
the right of eminent domain, (b) the alteration of the grade of any street, or
(c) any other injury to, taking of, or decrease in the value of, the Property to
the extent of all amounts which may be secured by this Security Deed at the date
of any such award or payment including but not limited to Reasonable Attorneys'
Fees (as hereinafter defined), costs and disbursements incurred by the Lender in
connection with the collection of such award or payment;
AS WELL AS all of the right, title and interest of Borrower in and to
all fixtures, goods, chattels, construction materials, furniture, furnishings,
equipment, machinery, apparatus, appliances, and other items of personal
property, whether tangible or intangible, of any kind, nature or description,
whether now owned or hereafter acquired by the Borrower, including, without
limitation, improvements including furnaces, steam boilers, hot-water boilers,
oil burners, pipes, radiators, air-conditioning and sprinkler systems, gas and
electric fixtures, carpets, rugs, shades, awnings, screens, elevators, motors,
dynamos, cabinets, and all other furnishings, tools, equipment and machinery,
appliances, building supplies, materials, general intangibles, contract rights,
accounts receivable, business records, fittings and fixtures of every kind,
which is, are or shall hereafter be located upon, attached, affixed to or used
or useful, either
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directly or indirectly, in connection with the complete and comfortable use,
occupancy and operation of said Real Property and Improvements as an apartment
complex, or any other business, enterprise or operation as may hereafter be
conducted upon or with said Real Property, Improvements and Appurtenances,
including, without limitation, any and all licenses, permits or franchises, used
or required in connection with such use, occupancy or operation, as well as the
proceeds thereof or therefrom regardless of form (hereinafter sometimes together
referred to as "Fixtures and Personal Property," which term expressly excludes
any toxic waste or substances deemed hazardous under federal, state or local
laws). The Borrower hereby expressly grants to Lender a present security
interest in and a lien and encumbrance upon the Fixtures and Personal Property;
TO HAVE AND HOLD the foregoing Property, and the rights hereby granted
for the use and benefit of the Lender and its successors and assigns in fee
simple forever;
AND the Borrower covenants and warrants with and to the Lender that the
Borrower is indefeasibly seized of the Property and has good right, full power,
and lawful authority to convey and encumber all of the same as aforesaid; that
the Borrower hereby fully warrants the title to the Property and will defend the
same and the validity and priority of the lien and encumbrance of this Security
Deed against the lawful claims of all persons whomsoever, subject only to the
Permitted Exceptions; and the Borrower further warrants that the Property is
free and clear of all liens and encumbrances of any kind, nature or description,
save and except only (with respect to said Real Property, Improvements and
Appurtenances and Fixtures and Personal Property) for real property taxes for
years subsequent to 1997 and those matters set forth in Exhibit "B" attached
hereto and by this reference made a part hereof (hereinafter referred to as the
"Permitted Exceptions").
PROVIDED ALWAYS, however, that if the Borrower shall pay unto the Lender
the indebtedness evidenced by the Note, and if the Borrower shall duly, promptly
and fully perform, discharge, execute, effect, complete and comply with and
abide by each and every one of the agreements, conditions and covenants of the
Note, this Security Deed and all other documents and instruments executed as
further evidence of or as security for the indebtedness secured hereby, then
this Security Deed and the estates and interests hereby granted and created
shall cease, terminate and be null and void, and shall be discharged of record
at the expense of Borrower, which expense Borrower agrees to pay.
This conveyance is intended (i) to constitute a security agreement as
required under the Uniform Commercial Code of Georgia and (ii) to operate and is
to be construed as a deed passing the title to the Property to the Lender and is
made under those provisions of the existing laws of the State of Georgia
relating to deeds to secure debt, and not as a mortgage, and is given to secure
(a) the debt evidenced by the Note (which is incorporated herein by reference
and to which reference is made for all purposes, and which Borrower acknowledges
evidences an indebtedness arising from a business loan from Lender to Borrower
for the sole purpose of permitting Borrower to carry on its business) in the
principal face amount of Eight Million Four Hundred Thousand and No/100 Dollars
($8,400,000.00), or so much thereof as may have been advanced and remain
outstanding from time to time, with interest at the rate of 7.15% percent per
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annum; (b) any and all renewals and extensions of the Note; (c) each and every
covenant, obligation and undertaking of the Borrower in this Security Deed or in
that certain Assignment of Leases, Rents and Profits of even date herewith from
Borrower to Lender; and (d) any and all other indebtedness which may hereafter
be owing by the Borrower to the Lender which is incurred or created by advances
made by the Lender to or on behalf of or for the account of the Borrower in
accordance with the provisions of this Security Deed or otherwise permitted by
the provisions of this Security Deed. Principal and interest shall be payable in
installments the last of which shall, unless the maturity thereof is accelerated
by the holder of the Note or the principal amount of the Note is prepaid, be due
and payable on June 15, 2008.
The Borrower, for the benefit of the Lender, and is successors and
assigns, does hereby expressly covenant and agree:
1. PAYMENT OF PRINCIPAL AND INTEREST. To pay the principal of the
indebtedness evidenced by the Note, together with all interest thereon, in
accordance with the terms of the Note, promptly at the times, at the place and
in the manner that said principal and interest shall become due, and to promptly
and punctually pay all other sums required to be paid by the Borrower pursuant
to the terms of the Note, this Security Deed and all other documents and
instruments executed as further evidence of, as additional security for or in
connection with the indebtedness evidenced by the Note and secured by this
Security Deed (hereinafter together referred to as the "Loan Documents").
2. PERFORMANCE OF OTHER OBLIGATIONS. To perform, comply with and
abide by each and every one of the covenants, agreements and conditions
contained and set forth in the Note, this Security Deed and the other Loan
Documents and to comply with all laws, ordinances, rules, regulations and orders
of governmental authorities now or hereafter affecting the Property or requiring
any alterations or improvements to be made thereon, and perform all of its
obligations under any covenant, condition, restriction or agreement of record
affecting the Property and to insure that at all times the Property constitutes
one or more legal lots capable of being conveyed without violation of any
subdivision or platting laws, ordinances, rules or regulations, or other laws
relating to the division or separation of real property.
3. PRESERVATION AND MAINTENANCE OF PROPERTY; ACCESSIBILITY;
HAZARDOUS WASTE. To keep all Improvements now existing or hereafter erected on
the Real Property in good order and repair and not to do or permit any waste,
impairment or deterioration thereof or thereon, nor to alter, remove or demolish
any of the Improvements or any Fixtures or Personal Property attached or
appertaining thereto, without the prior written consent of the Lender, nor to
initiate, join in or consent to any change in any private restrictive covenant,
zoning ordinance or other public or private restrictions limiting or defining
the uses which may be made of the Property or any part thereof, nor to do or
permit any other act whereby the Property shall become less valuable, be used
for purposes contrary to applicable law or be used in any manner which will
increase the premium for or result in a termination or cancellation of the
insurance hereinafter required to be kept and maintained on the Property. In
furtherance of, and not by way of limitation upon the foregoing covenant,
Borrower shall effect such repairs as the Lender may reasonably require, and
from time to time make all needful and proper
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replacements so that said Improvements, Appurtenances, Fixtures and Personal
Property will, at all times, be in good condition, fit and proper for the
respective purposes for which they were originally erected or installed.
Borrower at all times shall maintain the Property in full compliance with all
applicable provisions of all federal, state or municipal laws, ordinances, rules
and regulations currently in existence or hereafter enacted or rendered
governing accessibility for the disabled, including but not limited to The
Architectural Barriers Act of 1988, The Rehabilitation Act of 1973, The Fair
Housing Act of 1988 and The Americans With Disabilities Act of 1990
(hereinafter, collectively the "Accessibility Laws"). Borrower at all times
shall keep the Property and ground water of the Property free of "Hazardous
Materials" (as hereinafter defined). Borrower shall not permit its tenants or
any third party requiring the consent of Borrower to enter the Property, to use,
generate, manufacture, store, release, threaten release, or dispose of Hazardous
Materials in, on or about the Property or the ground water of the Property in
violation of any federal, state or municipal law, decision, statute, rule,
ordinance or regulation currently in evidence or hereinafter enacted or rendered
("Hazardous Waste Laws"). Borrower shall give Lender prompt written notice of
any claim by any person, entity, or governmental agency that a significant
release or disposal of Hazardous Materials has occurred on the Property. The
Borrower, through its professional engineers and at its cost, shall promptly and
thoroughly investigate suspected Hazardous Materials contamination of the
Property. Borrower shall forthwith remove, repair, clean up, and/or detoxify any
Hazardous Materials from the Property or the ground water of the Property
whether or not such actions are required by law, and whether or not Borrower was
responsible for the existence of the Hazardous Materials in, on or about the
Property or the ground water of the Property. "Hazardous Materials" shall
include but not be limited to substances defined as "hazardous substances,"
"hazardous materials," or "toxic substances," in the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. Sec.
9601, et. seq.; the Hazardous Materials Transportation Act, 49 U.S.C. 1801 et.
seq.; the Resources Conservation and Recovery Act, 42 U.S.C. Sec. 6901 et. seq.;
the Toxic Substances Control Act, 15 U.S.C. Sec. 2601 et. seq.; the Clean Air
Act, 42 U.S.C. Sec. 7401 et. seq.; and the Clean Water Act, 33 U.S.C. Sec. 1251
et. seq.
Borrower hereby agrees to indemnify Lender and hold Lender harmless from
and against any and all losses, liabilities, damages, injuries, costs, expenses
and claims of any and every kind whatsoever paid, incurred or suffered by or
asserted against Lender for, with respect to, or as a direct or indirect result
of the non-compliance of the Property with the Accessibility Laws and/or the
presence on, under or about the Property, or the escape, seepage, leakage,
spillage, discharge, emission, discharging or release from, the Property of any
Hazardous Materials (including, without limitation, any losses, liabilities,
damages, injuries, costs, expenses or claims asserted or arising under any
Hazardous Waste Laws, regardless of whether or not caused by, or within the
control of, Borrower).
Lender, and/or its agents, shall have the right and shall be permitted,
but shall not be required, at all reasonable times, to enter upon and inspect
the Property to insure compliance with the foregoing covenants and any and all
other covenants, agreements and conditions set forth in this Security Deed.
Liability under this Paragraph of this Security Deed shall extend beyond
repayment of the Note and compliance with the terms of this Security Deed;
provided, however, Borrower shall have no liability under this Paragraph 3 as to
Hazardous Materials: (a)
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if the Property becomes contaminated subsequent to Lender's acquisition of the
Property by foreclosure, acceptance by Lender of a deed in lieu thereof, or
subsequent to any transfer of ownership of the Property which was approved or
authorized by Lender in writing, provided that such transferee assumes all
obligations of Borrower with respect to Hazardous Materials pursuant to this
Security Deed; or (b) at such time Borrower provides Lender an environmental
assessment report acceptable to Lender showing the Property to be free of
Hazardous Materials and not in violation of Hazardous Waste Laws. The burden of
proof under this Paragraph with regard to establishing the date upon which
Hazardous Material was placed or appeared in, on or under the Property shall be
upon Borrower.
4. PAYMENT OF TAXES, ASSESSMENTS AND OTHER CHARGES. To pay all
and singular such taxes, assessments and public charges as are already levied or
assessed or that may be hereafter levied or assessed upon or against the
Property, when the same shall become due and payable according to law, before
the same become delinquent, and before any interest or penalty shall attach
thereto, and to deliver official receipts evidencing the payment of the same to
the Lender not later than thirty (30) days following the payment of the same.
Borrower shall have the right to contest, in good faith, the proposed assessment
of ad valorem taxes or special assessments by governmental authorities having
jurisdiction of the Property; provided, however, the Borrower shall give written
notice thereof to Lender and Lender may, in its sole discretion, require
Borrower to post a bond or other collateral satisfactory to Lender in connection
with any such action by Borrower; provided further, however, that so long as
there is no default hereunder (which is not cured within any applicable cure
period, if any) Lender agrees not to require Borrower to post a bond or other
collateral if (i) Borrower is appealing ad valorem taxes in the normal course of
Borrower's business and (ii) no action is taken to commence foreclosure
procedures on the Property or any portion thereof and (iii) the collateral
pledged to Lender to secure the loan evidenced by the Note and this Security
Deed is not otherwise jeopardized in Lender's sole opinion.
5. PAYMENT OF LIENS, CHARGES AND ENCUMBRANCES. To immediately pay
and discharge from time to time when the same shall become due all lawful claims
and demands of mechanics, materialmen, laborers and others which, if unpaid,
might result in, or permit the creation of, a lien, charge or encumbrance upon
the Property or any part thereof, or on the rents, issues, income, revenues,
profits and proceeds arising therefrom and, in general, to do or cause to be
done everything necessary so that the lien of this Security Deed shall be fully
preserved at the cost of the Borrower, without expense to the Lender. Borrower
shall have the right to contest, in good faith and in accordance with applicable
laws and procedures, mechanic's and materialmen's liens filed against the
Property; provided, however, that Borrower shall give written notice thereof to
Lender, and Lender may at its sole option require Borrower to post a bond or
other collateral satisfactory to Lender (and acceptable to the title company
insuring the Security Deed) in connection with any such action by Borrower.
6. PAYMENT OF JUNIOR ENCUMBRANCES. To permit no default or
delinquency under any other lien, imposition, charge or encumbrance against the
Property, even
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though junior and inferior to the lien of this Security Deed; provided, however,
the foregoing shall not be construed to permit any other lien or encumbrance
against the Property.
7. PAYMENT OF MORTGAGE TAXES. To pay any and all taxes which may
be levied or assessed directly or indirectly upon the Note and this Security
Deed (except for income taxes payable by the Lender) or the debt secured hereby,
without regard to any law which may be hereafter enacted imposing payment of the
whole or any part thereof upon the Lender, its successors or assigns. Upon
violation of this agreement to pay such taxes levied or assessed upon the Note
and this Security Deed, or upon the rendering by any court of competent
jurisdiction of a decision that such an agreement by the Borrower is legally
inoperative, or if any court of competent jurisdiction shall render a decision
that the rate of said tax when added to the rate of interest provided for in the
Note exceeds the then maximum rate of interest allowed by law, then, and in any
such event, the debt hereby secured shall, at the option of the Lender, its
successors or assigns, become immediately due and payable, anything contained in
this Security Deed or in the Note secured hereby notwithstanding, without the
imposition of a Prepayment Premium (as defined in the Note). The additional
amounts which may become due and payable hereunder shall be part of the debt
secured by this Security Deed.
8. HAZARD INSURANCE. To continuously, during the term hereof,
keep the Improvements and the Fixtures and Personal Property now or hereafter
existing, erected, installed and located in or upon the Real Property insured
with extended coverage insurance against loss or damage resulting from fire,
windstorm, flood (but only if any of the Improvements are located in a flood
plain), sinkhole and such other hazards, casualties, contingencies and perils,
including, without limitation, other risks insured against by persons operating
like properties in the locality of the Property, on such forms as may be
required by Lender, covering the Property in the amount of the full replacement
cost thereof (provided that Borrower provides a replacement cost endorsement
satisfactory to Lender; otherwise, the amount of such insurance shall not be
less than the difference between the outstanding balance of the Note and eighty
(80%) percent of the then appraised value of the Land and Improvements as
determined by Lender in its sole discretion), and covering all loss or abatement
of rental or other income without provision for co-insurance in an amount equal
to the scheduled rental income of the Property for a period of twelve (12)
months, or if applicable, business interruption insurance in an amount
sufficient to pay debt service, operating expenses, taxes and insurance for the
Property for twelve (12) months, and covering loss by flood (if the Property
lies in a specified Flood Hazard Area as designated on the Department of Housing
and Urban Development Maps, or other flood prone designation) in an amount equal
to the outstanding principal balance of the indebtedness secured hereby or such
other amount of coverage as approved by Lender. All such insurance shall be
carried with such company or companies as may be acceptable to the Lender, which
company or companies shall have a current rating equivalent to at least A:VIII
as shown in Best's Key Rating Guide, and the original policy or policies and
renewals thereof (or duplicate originals or certified copies thereof), together
with receipts evidencing payment of the premium therefor, shall be deposited
with, held by and are hereby assigned to Lender as additional security for the
indebtedness secured hereby. Each such policy of insurance shall contain a
non-contributing loss payable clause in favor of and in form acceptable to
Lender and shall provide for not less than thirty (30) days' prior written
notice to Lender of intent to modify, cancel or
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terminate or the expiration of such policies of insurance. Not less than fifteen
(15) days prior to the expiration dates of each policy required of the Borrower
hereunder, Borrower will deliver to Lender a renewal policy or policies or a
certified copy thereof marked "premium paid" or accompanied by other evidence of
payment and renewal satisfactory to Lender (Lender agrees that a binder for a
renewal policy accompanied by a copy of an invoice for the premium associated
therewith (which may show that the premium can be paid in quarterly
installments) shall be satisfactory evidence of payment and renewal provided
that Borrower delivers to Lender evidence of the payment of such premium on or
before the date the premium (or installments thereof, if applicable) is due);
and in the event of foreclosure of or exercise of the power of sale in this
Security Deed, any purchaser or purchasers of the Property shall succeed to all
rights of the Borrower, including any rights to unearned premiums, in and to all
insurance policies assigned and delivered to Lender pursuant to the provisions
of this Paragraph 8.
In the event of loss by reason of hazards, casualties, contingencies or
perils for which insurance has been required by the Lender hereunder, the
Borrower shall give immediate notice thereof to the Lender, and the Lender is
hereby irrevocably appointed attorney-in-fact coupled with an interest, for the
Borrower to, at Lender's option, make proof of loss if not made promptly by the
Borrower, and each insurance company concerned is hereby notified, authorized
and directed to make payment for such loss directly to the Lender, instead of to
the Borrower and Lender jointly, and Borrower hereby authorizes Lender to adjust
and compromise any losses for which insurance proceeds are payable under any of
the aforesaid insurance policies and, after deducting the costs of collection,
to apply the proceeds of such insurance, at its option, as follows: (a) to the
restoration or repair of the insured Improvements, Fixtures and Personal
Property, provided that, in the opinion and sole discretion of the Lender, such
restoration or repair is reasonably practical and, provided further, that, in
the opinion and sole discretion of the Lender, either: (i) the insurance
proceeds so collected are sufficient to cover the cost of such restoration or
repair of the damage or destruction with respect to which such proceeds were
paid, or (ii) the insurance proceeds so collected are not sufficient alone to
cover the cost of such restoration or repair, but are sufficient therefor when
taken together with funds provided and made available by the Borrower from other
sources; in which event the Lender shall make such insurance proceeds available
to the Borrower for the purpose of effecting such restoration or repair; but
Lender shall not be obligated to see to the proper application of such insurance
proceeds nor shall the amount of funds so released or used be deemed to be
payment of or on account of the indebtedness secured hereby, or (b) to the
reduction of the outstanding principal indebtedness secured hereby,
notwithstanding the fact that the amount owing thereon may not then be due and
payable or that said indebtedness is otherwise adequately secured, in which
event such proceeds shall be applied at par against the indebtedness secured
hereby and the monthly payment due on account of such indebtedness shall be
adjusted accordingly. None of such actions taken by the Lender shall be deemed
to be or result in a waiver or impairment of any equity, lien or right of the
Lender under and by virtue of this Security Deed, nor will the application of
such insurance proceeds to the reduction of the indebtedness serve to cure any
default in the payment thereof. In the event of foreclosure of this Security
Deed or other transfer of title to the Property in extinguishment of the
indebtedness secured hereby, all right, title and interest of the Borrower in
and to any insurance policies then in force and insurance proceeds then payable
shall pass to the purchaser or grantee.
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In case of Borrower's failure to keep the Property so insured, Lender or
its assigns, may, at its option (but shall not be required to) effect such
insurance at Borrower's expense.
Notwithstanding anything set forth in this Paragraph 8 to the contrary,
in the event of loss or damage to the Property by fire or other casualty for
which insurance has been required by Lender and provided by Borrower, and the
amount of such loss or damage does not exceed fifty percent (50%) of the
outstanding principal balance of the Note, the Lender hereby agrees to allow the
proceeds of insurance to be used for restoration of the Property and to release
such insurance proceeds to Borrower as such restoration progresses, provided:
(a) Borrower is not in default under any of the terms,
covenants and conditions of this Security Deed, the
Note or any of the Loan Documents evidencing or
securing the Note;
(b) [intentionally omitted]
(c) The plans and specifications for restoration of the
Property are approved in writing by the Lender;
(d) At all times during such restoration, Borrower has
deposited with Lender funds which, when added to such
insurance proceeds, are sufficient to complete the
restoration of the Property as certified by an
architect approved by Lender in accordance with the
approved plans and specifications and all applicable
building codes and zoning ordinances and regulations,
and further, that the sufficiency of such funds is
certified to Lender by Lender's inspecting
architect/engineer;
(e) Borrower provides payment and performance bonds and
builder's all risk insurance for such restoration in
form and amount acceptable to Lender;
(f) The insurer under such policies of fire or other
casualty insurance does not assert any defense to
payment under such policies against Lender, Borrower
or any tenant of the Property;
(g) The insurance proceeds held by Lender shall be
disbursed no more often than once per month and in
not more than five (5) increments of amounts of not
less than FIFTY THOUSAND AND NO/100 DOLLARS
($50,000.00) each (except the final disbursement of
such proceeds which may be in an amount less than
FIFTY THOUSAND AND NO/100 DOLLARS ($50,000.00).
Lender's obligation to make any such disbursement
shall be conditioned upon Lender's receipt of a
written certification from the Lender's inspecting
architect/engineer that all construction and work for
which such disbursement is requested has been
completed in accordance with the approved plans and
specifications and all applicable building
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codes, zoning ordinances and all other local or
federal governmental regulations and, further, that
Borrower has deposited with Lender sufficient funds
to complete such restoration in accordance with
subparagraph (d) above;
(h) Lender shall have the option, upon the completion of
such restoration of the Property, to apply any
surplus insurance proceeds remaining after the
completion of such restoration, at par, to the
reduction of the indebtedness secured by this
Security Deed; notwithstanding the fact that the
amount owing thereon may not then be due and payable
or that said indebtedness is otherwise adequately
secured; and
(i) Lender shall be entitled to require and to impose
such other conditions to the release of such
insurance proceeds for restoration of the Property as
would be customarily or reasonably required and
imposed by a construction lender for a project of
similar nature and cost.
9. LIABILITY INSURANCE. To carry and maintain such comprehensive
general liability insurance as may from time to time be required by Lender,
taking into consideration the type of property insured and the corresponding
liability exposure, on forms, in amounts and with such company or companies as
may be acceptable to Lender. All such comprehensive general liability insurance
shall be carried with a company or companies as may be acceptable to Lender,
which company or companies shall have a current rating equivalent to at least
A:VIII as shown in Best's Key Rating Guide. Such policy or policies of insurance
shall name Lender as an additional insured and shall provide for not less than
thirty (30) days' prior written notice to Lender of modification, cancellation,
termination or expiration of such policy or policies of insurance. Not less than
fifteen (15) days prior to the expiration dates of such policy or policies,
Borrower will deliver to Lender a renewal policy or policies or a certified copy
thereof marked "premium paid" or accompanied by other evidence of payment and
renewal satisfactory to Lender (Lender agrees that a binder for a renewal policy
accompanied by a copy of an invoice for the premium associated therewith (which
may show that the premium can be paid in quarterly installments) shall be
satisfactory evidence of payment and renewal provided that Borrower delivers to
Lender evidence of the payment of such premium on or before the date the premium
(or installments thereof, if applicable) is due). The original policy or
policies and all renewals thereof (or duplicate originals or certified copies
thereof), together with receipts evidencing payment of the premium therefor,
shall be deposited with, held by and are hereby assigned to Lender as additional
security for the indebtedness secured hereby.
10. COMPLIANCE WITH LAWS. To observe, abide by and comply with all
statutes ordinances, laws, orders, requirements or decrees relating to the
Property enacted, promulgated or issued by any federal, state, county or
municipal authority or any agency or subdivision thereof having jurisdiction
over the Borrower or the Property, and to observe and comply with all conditions
and requirements necessary to preserve and extend any and all rights, licenses,
permits (including, but not limited to, zoning variances, special exceptions and
nonconforming uses), privileges, franchises and concessions which are applicable
to the Property or which have
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been granted to or contracted for by Borrower in connection with any existing,
presently contemplated or future use of the Property.
11. MAINTENANCE OF PERMITS. To obtain, keep and constantly
maintain in full force and effect during the entire term of this Security Deed,
all certificates, licenses and permits necessary to keep the Property operating
as an apartment complex project, and, except as specifically provided for in
this mortgage, not to assign, transfer or in any manner change such
certificates, licenses or permits without first receiving the written consent of
the Lender.
12. OBLIGATIONS OF BORROWER AS LESSOR. To perform every obligation
of the Borrower (as the lessor) and enforce every obligation of the lessee in
any and every lease or other occupancy agreement affecting the Property or any
part thereof (hereinafter referred to as the "Occupancy Leases"), and not to
modify, alter, waive or cancel any such Occupancy Leases or any part thereof,
nor collect for more than thirty (30) days in advance any rents that may be
collectible under any such Occupancy Leases and, except as provided for in this
Security Deed, not to assign any such Occupancy Lease or any such rents to any
party other than Lender, without the prior written consent of the Lender. In the
event of default under any such Occupancy Lease by reason of failure of the
Borrower to keep or perform one or more of the covenants, agreements or
conditions thereof, the Lender is hereby authorized and empowered, and may, at
its sole option, remedy, remove or cure any such default, and further, Lender
may, at its sole option and in its sole discretion, but without obligation to do
so, pay any sum of money deemed necessary by it for the performance of said
covenants, agreements and conditions, or for the curing or removal of any such
default, and incur all expenses and obligations which it may consider necessary
or reasonable in connection therewith, and Borrower shall repay on demand all
such sums so paid or advanced by Lender together with interest thereon until
paid at the lesser of either (i) the highest rate then allowed by the laws of
the State of Georgia, or, if controlling, the laws of the United States, or (ii)
the then-applicable interest rate of the Note plus five hundred (500) basis
points; all of such sums, if unpaid, shall be added to and become part of the
indebtedness secured hereby. All such Occupancy Leases hereafter made shall be
subject to the approval of Lender and (a) shall be at competitive market rental
rates then prevailing in the geographic area for apartment complexes comparable
to the Property and (b) at Lender's option shall be superior or subordinate in
all respects to the lien of this Security Deed. Provided, however, that the
Lender shall not require approval in advance of any Occupancy Leases which
conform to the Borrower's Form Lease (as hereinafter defined) as previously
approved by Lender, except as set forth below. Neither the right nor the
exercise of the right herein granted unto Lender to keep or perform any such
covenants, agreements, or conditions as aforesaid shall preclude Lender from
exercising its option to cause the whole indebtedness secured hereby to become
immediately, but subject to the notice and cure period in Paragraph 23, due and
payable by reason of Borrower's default in keeping or performing any such
covenants, agreements or conditions as hereinabove required.
Lender has heretofore approved a form of Occupancy Lease to be used by
Borrower in connection with the Property (hereinafter referred to as the "Form
Lease"). Borrower shall not, without the prior written consent of the Lender,
modify or alter the Form Lease in any material respect. In addition Borrower
shall not, without the prior written consent of Lender, surrender or
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terminate (except in the ordinary course of business), either orally or in
writing, any Occupancy Lease now existing or hereafter made for all or part of
the Property, permit an assignment or sublease of any such Occupancy Lease, or
request or consent to the subordination of any Occupancy Lease to any lien
subordinate to this Security Deed. Upon request, the Borrower shall furnish the
Lender with copies of all executed Occupancy Leases of all or any part of the
Property now existing or hereafter made, and Borrower shall assign to the Lender
(which assignment shall be in form and content acceptable to Lender), as
additional security for the Note, all Occupancy Leases now existing or hereafter
made of all or any part of the Property.
13. MAINTENANCE OF PARKING AND ACCESS; PROHIBITION AGAINST
ALTERATION. To construct, keep and constantly maintain, as the case may be, all
curbs, drives, parking areas and the number of parking spaces heretofore
approved by the Lender or heretofore or hereafter required by any governmental
body, agency or authority having jurisdiction over the Borrower or the Property,
and not to alter, erect, build or construct upon any portion of the Property,
any building or structure of any kind whatsoever, the erection, building or
construction of which has not been previously approved by Lender in writing,
which approval shall be at the sole discretion of Lender. To the extent any
alterations or improvements are required to be approved by any tenants of the
Property, no such alterations or improvements shall be made unless and until
such consent has been obtained in writing and a copy thereof furnished to
Lender.
14. EXECUTION OF ADDITIONAL DOCUMENTS. To do, execute, acknowledge
and deliver all and every such further acts, deeds, conveyances, mortgages,
deeds to secure debt, assignments, notices of assignments, transfers, assurances
and other instruments, including security agreements and financing statements,
as the Lender shall from time to time require for the purpose of better
assuring, conveying, assigning, transferring and confirming unto the Lender the
Property and rights hereby encumbered, created, conveyed, assigned or intended
now or hereafter so to be encumbered, created, conveyed or assigned or which the
Borrower may now be or may hereafter become bound to encumber, create, convey,
or assign to the Lender, or for the purpose of carrying out the intention or
facilitating the performance of the terms of this Security Deed, or for filing,
registering or recording this Security Deed, and to pay all filing, registration
or recording fees and all taxes, costs and other expenses, including Reasonable
Attorneys' Fees (as defined in Paragraph 47), incident to the preparation,
execution, acknowledgment, delivery, and recordation of any of the same.
15. AFTER-ACQUIRED PROPERTY SECURED. It is understood and agreed
that all right, title and interest of the Borrower in and to all extensions,
improvements, betterments, renewals, substitutions and replacements of, and all
additions and appurtenances to, the Property hereinabove described, hereafter
acquired by or released to the Borrower, or constructed, assembled or placed by
the Borrower on the Real Property, and all conversions of the security
constituted thereby, immediately upon such acquisition, release, construction,
assembling, placement or conversion, as the case may be, and in each such case,
without any further mortgage, encumbrance, conveyance, assignment or other act
by the Borrower, shall become subject to the lien and security title of this
Security Deed as fully and completely and with the same effect as though now
owned by the Borrower and specifically described herein, but at any
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and all times the Borrower will execute and deliver to the Lender any and all
such further assurances, mortgages, deeds to secure debt, conveyances, or
assignments thereof or security interests therein as the Lender may reasonably
require for the purpose of expressly and specifically subjecting the same to the
lien of this Security Deed.
16. PAYMENTS BY LENDER ON BEHALF OF BORROWER. Should the Borrower
fail to make payment of any taxes, assessments or public charges on or with
respect to the Property before the same shall become delinquent, or shall fail
to make payment of any insurance premiums or other charges, impositions or liens
herein or elsewhere required to be paid by the Borrower, then the Lender, at its
sole option, but without obligation to do so, may make payment or payments of
the same and also may redeem the Property from tax sale without any obligation
to inquire into the validity of such taxes, assessments and tax sales. In the
case of any such payment by the Lender, the Borrower agrees to reimburse the
Lender, upon demand therefor, the amount of such payment and of any fees and
expenses attendant in making the same, together with interest thereon at the
lesser of either (i) the highest rate then allowed by the laws of the State of
Georgia, or if controlling, the laws of the United States, or (ii) the then
applicable interest rate of the Note plus five hundred (500) basis points; and
until paid, such amounts and interest shall be added to and become part of the
debt secured hereby to the same extent that this Security Deed secures the
repayment of the indebtedness evidenced by the Note. In making payments hereby
authorized by the provisions of this Paragraph 16; the Lender may do so
whenever, in its sole judgment and discretion, such advance or advances are
necessary or desirable to protect the full security intended to be afforded by
this instrument. Neither the right nor the exercise of the right herein granted
unto the Lender to make any such payments as aforesaid shall preclude the Lender
from exercising its option to cause the whole indebtedness secured hereby to
become immediately due and payable by reason of the Borrower's default in making
such payments as hereinabove required.
17. FUNDS HELD BY LENDER FOR TAXES, INSURANCE PREMIUMS,
ASSESSMENTS AND OTHER CHARGES. In order to more fully protect the security of
this Security Deed, Borrower shall deposit with the Lender, together with and in
addition to each monthly payment due on account of the indebtedness evidenced by
the Note, an amount equal to one-twelfth (1/12) of the annual total of such
taxes, insurance premiums, assessments and charges (all as estimated by the
Lender in its sole discretion) so that, at least thirty (30) days prior to the
due date thereof, Lender shall be able to pay in full all such taxes, insurance
premiums, assessments and other charges as the same shall become due, and the
Lender may hold without paying interest and commingle with its general funds the
sums so deposited and apply the same to the payment of said taxes, insurance
premiums, assessments or other charges as they become due and payable. If at any
time the funds so held by Lender are insufficient to pay such taxes, insurance
premiums, assessments or other charges as they become due and payable the
Borrower shall immediately, upon notice and demand by Lender, deposit with
Lender the amount of such deficiency, and the failure on the part of the
Borrower to do so shall entitle the Lender, at its sole option, to make such
payments in accordance with its rights and pursuant to the conditions elsewhere
provided in this Security Deed. Notwithstanding any default under this Security
Deed, Lender agrees to apply any funds deposited by Borrower and being held by
Lender pursuant to this paragraph for the payment of taxes toward the payment of
taxes which are then a lien on the
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Property. Thereafter, at its sole option, Lender may apply any funds so held by
it pursuant to this Paragraph 17 toward the payment of the indebtedness secured
hereby, notwithstanding the fact that the amount owing thereon may not then be
due and payable or that said indebtedness is otherwise adequately secured in
such order and manner of application as Lender may elect.
18. CONDEMNATION; EMINENT DOMAIN. All awards and other
compensation heretofore or hereafter made to Borrower and all subsequent owners
of the Property in any taking by eminent domain or recovery for inverse
condemnation, either permanent or temporary, of all or any part of the Property
or any easement or any appurtenance thereto, including severance and
consequential damages and change in grade of any street, are hereby assigned to
Lender, and Borrower hereby irrevocably appoints Lender as its attorney-in-fact,
coupled with an interest, and authorizes, directs and empowers such attorney, at
the option of said attorney, on behalf of Borrower, its successors and assigns,
to adjust or compromise the claim for any such award and alone to collect and
receive the proceeds thereof, to give proper receipts and acquittances therefor
and, after deducting any expenses of collection, at its sole option:
(i) to apply the net proceeds as a credit upon the outstanding
principal balance of the indebtedness secured hereby, as
selected by Lender, notwithstanding the fact that the amount
owing thereon may not then be due and payable or that the
indebtedness is otherwise adequately secured. In the event
Lender applies such awards to the reduction of the outstanding
indebtedness evidenced by the Note, such proceeds shall be
applied at par and the monthly installments due and payable
under the Note shall be adjusted accordingly; however no such
application shall serve to cure an existing default in the
payment of the Note; or
(ii) to hold said proceeds without any allowance of interest and
make the same available for restoration or rebuilding the
Property. In the event that Lender elects to make said
proceeds available to reimburse Borrower for the cost of the
restoration or rebuilding of the buildings or improvements on
the Property, such proceeds shall be made available in the
manner and under the conditions that Lender may require as
provided under Paragraph 8 hereof. If the proceeds are made
available by Lender to reimburse Borrower for the cost of said
restoration or rebuilding, any surplus which may remain out of
said award after payment of such cost of restoration or
rebuilding shall be applied on account of the indebtedness
secured hereby at par notwithstanding the fact that the amount
owing thereon may not then be due and payable or that said
indebtedness is otherwise adequately secured.
Borrower further covenants and agrees to give Lender immediate notice of
the actual or threatened commencement of any proceedings under eminent domain
and to deliver to Lender copies of any and all papers served in connection with
any proceedings. Borrower further covenants and agrees to make, execute and
deliver to Lender, at any time or times, upon request, free, clear and
discharged of any encumbrance of any kind whatsoever, any and all further
assignments and/or other instruments deemed necessary by Lender for the purpose
of validly and sufficiently assigning all such awards and other compensation
heretofore or hereafter made to
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Lender (including the assignment of any award from the United States government
at any time after the allowance of the claim therefor, the ascertainment of the
amount thereof and the issuance of the warrant for payment thereof).
It shall be a default hereunder if any part of any of the Improvements
situated on the Property shall be condemned by any governmental authority having
jurisdiction, or if lands constituting a portion of the Property shall be
condemned by any governmental authority having jurisdiction, such that the
Property is in violation of applicable parking, zoning or other ordinances, or
fails to comply with the terms of the Occupancy Leases, and in either of said
events, Lender shall be entitled to exercise any or all remedies provided or
referenced in this Security Deed.
19. COSTS OF COLLECTION. In the event that the Note secured hereby
is placed in the hands of an attorney for collection, or in the event that the
Lender shall become a party either as plaintiff or as defendant, in any action,
suit, appeal or legal proceeding (including, without limitation, foreclosure,
condemnation, bankruptcy, administrative proceedings or any proceeding wherein
proof of claim is by law required to be filed), hearing, motion or application
before any court or administrative body in relation to the Property or the lien
and security interest granted or created hereby or herein, or for the recovery
or protection of said indebtedness or the Property, or for the foreclosure of
this Security Deed, the Borrower shall save and hold the Lender harmless from
and against any and all costs and expenses incurred by the Lender on account
thereof, including, but not limited to, Reasonable Attorneys' Fees, title
searches and abstract and survey charges, at all trial and appellate levels, and
the Borrower shall repay, on demand, all such costs and expenses, together with
interest thereon until paid at the lesser of either (i) the highest rate then
allowed by the laws of the State of Georgia, or, if controlling, the laws of the
United States, or (ii) the applicable rate of interest of the Note plus five
hundred (500) basis point; all of which sums, if unpaid, shall be added to and
become a part of the indebtedness secured hereby.
20. DEFAULT RATE. If the entire outstanding balance of the Note is
due, whether at maturity, by acceleration or otherwise, the total amount due,
whether principal, interest or money owing for advancements pursuant to the
terms of this Security Deed or any other Loan Document, shall bear interest
until paid at the lesser of (i) the highest rate then allowed by the laws of the
State of Georgia, or, if controlling, the laws of the United States, or (ii) the
then applicable rate of interest of the Note plus five hundred (500) basis
points (five percent per annum); all of which sums shall be added to and become
a part of the indebtedness secured hereby.
21. SAVINGS CLAUSE; SEVERABILITY. Notwithstanding any provisions
in the Note or in this Security Deed to the contrary, the total liability for
payments in the nature of interest including but not limited to Prepayment
Premiums, default interest and late fees shall not exceed the limits imposed by
laws of the State of Georgia or the United States of America relating to maximum
allowable charges of interest. Lender shall not be entitled to receive, collect
or apply, as interest on the indebtedness evidenced by the Note, any amount in
excess of the maximum lawful rate of interest permitted to be charged by
applicable law. In the event Lender ever receives, collects or applies as
interest any such excess, such amount which would
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be excessive interest shall be applied to reduce the unpaid principal balance of
the indebtedness evidenced by the note. If the unpaid principal balance of such
indebtedness is paid in full any remaining excess shall be paid forthwith to the
Borrower. If any clauses or provisions herein contained operate or would
prospectively operate to invalidate this Security Deed, then such clauses or
provisions only shall be held for naught, as though not herein contained, and
the remainder of this Security Deed shall remain operative and in full force and
effect.
22. BANKRUPTCY, REORGANIZATION OR ASSIGNMENT. It shall be a
default hereunder if the Borrower or any general partner of Borrower shall: (a)
consent to the appointment of a receiver, trustee or liquidator of all or a
substantial part of Borrower's assets, or (b) be adjudicated a bankrupt or
insolvent, or file a voluntary petition in bankruptcy, or admit in writing its
inability to pay its debts as they become due, or (c) make a general assignment
for the benefit of creditors, or (d) file a petition under or take advantage of
any insolvency law, or (e) file an answer admitting the material allegations of
a petition filed against the Borrower or any general partner of Borrower in any
bankruptcy, reorganization or insolvency proceeding or fail to cause the
dismissal of such petition within sixty (60) days after the filing of said
petition, or (f) take action for the purpose of effecting any of the foregoing,
or (g) if any order, judgment or decree shall be entered upon an application of
a creditor of Borrower or any general partner of Borrower by a court of
competent jurisdiction approving a petition seeking appointment of a receiver or
trustee of all or a substantial part of the Borrower's assets or any of
Borrower's general partner's assets and such order, judgment or decree shall
continue unstayed and in effect for a period of sixty (60) days.
23. TIME IS OF THE ESSENCE; MONETARY AND NON-MONETARY DEFAULTS. It
is understood by Borrower that time is of the essence hereof in connection with
all obligations of Borrower herein, in the Note, the Assignment (as defined in
Paragraph 34) and any of the other Loan Documents.
If default be made in the payment of any installment of the Note,
whether of principal or interest, or in the payment of any other sums of money
referred to herein or in the Note, promptly and fully when the same shall be due
and such Monetary Default (as hereinafter defined) remains uncured after the
Monetary Cure Period (as hereinafter defined), if applicable (if the Monetary
Cure Period is not applicable, no notice or demand from Lender to Borrower shall
be required), or in the event a breach or default be made by the Borrower in any
one of the agreements, conditions and covenants of said Note, this Security
Deed, the Assignment or any Loan Documents evidencing or securing the Note, or
in the event that each and every one of said agreements, conditions and
covenants are not otherwise duly, promptly and fully discharged or performed,
and any such Non-Monetary Default (as hereinafter defined) remains uncured for a
period of thirty (30) days after written notice thereof from the Lender to the
Borrower has been delivered in the manner prescribed in Paragraph 41 hereof
(except that if such Non-Monetary Default cannot reasonably be cured within the
30 day period Borrower shall have a reasonable period of time to cure such
default provided that Borrower commences the cure of such default within the 30
day period and thereafter diligently pursues the cure to completion), Lender at
its sole option may thereupon or thereafter declare the indebtedness evidenced
by the Note, as well as all other monies secured hereby, including, without
limitation, all Prepayment Premiums and
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late payment charges, to be forthwith due and payable, whereupon the principal
of and the interest accrued on the indebtedness evidenced by the Note and all
other sums secured by this Security Deed at the option of Lender shall
immediately become due and payable as if all of said sums of money were
originally stipulated to be paid on such day, and thereupon, the Lender may
avail itself of all rights and remedies provided by law and may prosecute a suit
at law or in equity as if all monies secured hereby had matured prior to its
institution, anything in this Security Deed or in the Note to the contrary
notwithstanding. Lender shall give Borrower notice in the manner described in
Paragraph 41 hereof of, and a 5 day right-to-cure period ("Monetary Cure
Period") to cure, any Monetary Default (as hereinafter defined); provided,
however such Monetary Cure Period shall be limited to once per loan year for the
term of the Note. Lender shall have no obligation to give Borrower notice of any
Incurable Default (as hereinafter defined) prior to exercising its right, power
and privilege to accelerate the maturity of the indebtedness secured hereby.
As used herein, the term "Monetary Default" shall mean any default which
can be cured by the payment of money such as, but not limited to, the payment of
principal and interest due under the Note, the payment of taxes, assessments and
insurance premiums when due as provided in this Security Deed. As used herein,
the term "Non-Monetary Default" shall mean any default which is not a Monetary
Default or an Incurable Default. As used herein, the term "Incurable Default"
shall mean (i) any voluntary or involuntary sale, assignment, mortgaging,
encumbering or transfer in violation of the covenants contained in Paragraph 30
hereof; or (ii) if Borrower, or its general partner, should make an assignment
for the benefit of creditors, become insolvent, or file a petition in bankruptcy
(including but not limited to, a petition seeking a rearrangement or
reorganization).
If a default shall occur hereunder and is not timely cured as herein
provided, and, as a result thereof, the indebtedness secured hereby is
accelerated and is due and payable in full, the Lender, at its option, may sell
the Property or any part of the Property at public sale or sales before the door
of the courthouse of the County in which the Property or any part of the
Property is situated, to the highest bidder for cash, in order to pay the
indebtedness secured hereby and accrued interest thereon and insurance premiums,
liens, assessments, taxes and charges, including utility charges, if any, with
accrued interest thereon, and all expenses of the sale and of all proceedings in
connection therewith, including Reasonable Attorney's Fees after advertising the
time, place and terms of sale once a week for four (4) weeks immediately
preceding such sale (but without regard to the number of days) in a newspaper in
which Sheriff's sales are advertised in said County. The foregoing
notwithstanding, the Lender may sell, or cause to be sold, any tangible or
intangible personal property, or any part thereof, and which constitute a part
of the security hereunder, in the foregoing manner, or as may otherwise be
provided by law. The Lender may bid and purchase at any such sale and, if Lender
should be the successful bidder at such sale, may satisfy the Lender's
obligation to purchase pursuant to the Lender's bid by canceling an equivalent
portion of any indebtedness then outstanding and secured hereby. At any such
sale, the Lender may execute and deliver to the purchaser a conveyance of the
Property or any part of the Property in fee simple with full warranties of title
and to this end, the Borrower hereby constitutes and appoints the Lender the
agent and attorney in fact of the Borrower to make such sale and conveyance, and
thereby to divest the Borrower of all right, title and equity
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that the Borrower may have in and to the Property and to vest the same in the
purchaser or purchasers at such sale or sales, and all the acts and doings of
said agent and attorney in fact are hereby ratified and confirmed and any
recitals in said conveyance or conveyances as to facts essential to a valid sale
shall be binding on the Borrower. The aforesaid power of sale and agency hereby
granted are coupled with an interest and are irrevocable by death or otherwise,
are granted as cumulative of the other remedies provided by law for collection
of the indebtedness secured hereby and shall not be exhausted by one exercise
thereof but may be exercised until full payment of all sums secured hereby. Upon
any such sale pursuant to the aforementioned power of sale and agency, the
proceeds of said sale shall be applied first to payment of the indebtedness
secured hereby and accrued interest and late charges thereon, then to said
insurance premiums, liens, assessments, taxes and charges including utility
charges with accrued interest thereon and then to the reasonable expenses of
such sale and of all proceedings in connection therewith, including reasonable
attorney's fees, and finally, the remainder, if any, shall be paid to the party
legally entitled to same.
In the event of any such public sale pursuant to the aforesaid power of
sale and agency, the Borrower shall be deemed a tenant holding over and shall
forthwith deliver possession of the Property to the purchaser or purchasers at
such sale or be summarily dispossessed according to provisions of law applicable
to tenants holding over.
The failure or omission on the part of the Lender to exercise the option
for acceleration of maturity and to foreclose or exercise the power of sale in
this Security Deed following any default as aforesaid or to exercise any other
option or remedy granted hereunder to Lender when entitled to do so in any one
or more instances, or the acceptance by Lender of partial payment of the
indebtedness secured hereby, whether before or subsequent to Borrower's defaults
hereunder, shall not constitute a waiver of any such default or the right to
exercise any such option or remedy, but such option or remedy shall remain
continuously in force. Acceleration of maturity, once claimed hereunder by
Lender, at the option of Lender, may be rescinded by written acknowledgment to
that effect by Lender, but the tender and acceptance of partial payments alone
shall not in any way affect or rescind such acceleration of maturity.
In case Lender shall have proceeded to enforce any right, power
or remedy under this Security Deed by foreclosure, entry or otherwise, or in the
event Lender commences advertising of the intended exercise of the sale under
power provided hereunder and such proceeding or advertisement shall have been
withdrawn, discontinued or abandoned for any reason, or shall have been
determined adversely to Lender, then in every such case (i) Borrower and Lender
shall be restored to their former positions and rights, (ii) all rights, powers
and remedies of Lender shall continue as if no such proceeding had been taken,
(iii) each and every Default declared or occurring prior or subsequent to such
withdrawal, discontinuance or abandonment shall be and shall be deemed to be a
continuing Default, and (iv) neither this Security Deed, nor the Note, nor any
other instrument concerned therewith, shall be or shall be deemed to have been
reinstated or otherwise affected by such withdrawal, discontinuance or
abandonment, and Borrower hereby expressly waives the benefit of any statute or
rule of law now provided, or which may hereafter be provided, which would
produce a result contrary to or in conflict with the above.
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24. PROTECTION OF LENDER'S SECURITY. At any time after default
hereunder, the Lender is authorized, without notice and in its sole discretion,
to enter upon and take possession of the Property or any part thereof and to
perform any acts which the Lender deems necessary or proper to conserve the
security herein intended to be provided by the Property, to operate any business
or businesses conducted thereon and to collect and receive all rents, issues and
profits thereof and therefrom, including those past due as well as those
accruing thereafter.
25. APPOINTMENT OF RECEIVER. If, at any time after a default
hereunder, in the sole discretion of the Lender, a receivership may be necessary
to protect the Property or its rents, issues, revenue, profits or proceeds,
whether before or after maturity of the indebtedness secured hereby and whether
before or at the time of or after the institution of suit to collect such
indebtedness, or to enforce this Security Deed, the Lender, as a matter of
strict right and regardless of the value of the Property or the amounts due
hereunder or secured hereby, or of the solvency of any party bound for the
payment of such indebtedness, shall have the right, upon ex parte application
and without notice to anyone, and by any court having jurisdiction, to the
appointment of a receiver to take charge of, manage, preserve, protect and
operate the Property, to collect the rents, issues, revenues, profits, proceeds
and income thereof, to make all necessary and needful repairs, and to pay all
taxes, assessments and charges against the Property and all premiums for
insurance thereon, and to do such other acts as may by such court be authorized
and directed, and after payment of the expenses of the receivership and the
management of the Property, to apply the net proceeds of such receivership in
reduction of the indebtedness secured hereby or in such other manner as the said
court shall direct, notwithstanding the fact that the amount owing thereon may
not then be due and payable or the said indebtedness is otherwise adequately
secured. Such receivership shall, at the option of Lender, continue until full
payment of all sums hereby secured or until title to the Property shall have
passed by sale under this Security Deed. Borrower hereby specifically waives its
right to object to the appointment of a receiver as aforesaid and hereby
expressly agrees that such appointment shall be made as an admitted equity and
as a matter of absolute right to the Lender.
26. RIGHTS AND REMEDIES CUMULATIVE; FORBEARANCE NOT A WAIVER. The
rights and remedies herein provided are cumulative and Lender, as the holder of
the Note and of every other obligation secured hereby, may recover judgment
thereon, issue execution therefor and resort to every other right or remedy
available at law or in equity, without first exhausting any right or remedy
available to Lender and without affecting or impairing the security of any right
or remedy afforded hereby, and no enumeration of special rights or powers by any
provisions hereof shall be construed to limit any grant of general rights or
powers, or to take away or limit any and all rights granted to or vested in
Lender by law, and Borrower further agrees that no delay or omission on the part
of the Lender to exercise any rights or powers accruing to it hereunder shall
impair any such right or power or shall be construed to be a waiver of any such
event of default hereunder or any acquiescence therein; and every right, power
and remedy granted herein or by law to the Lender may be exercised from time to
time as often as may be deemed expedient by the Lender.
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27. MODIFICATION NOT AN IMPAIRMENT OF SECURITY. Lender, without
notice and without regard to the consideration, if any, paid therefor, and
notwithstanding the existence at the time of any inferior mortgages, deeds to
secure debt, or other liens thereon, may release any part of the security
described herein or may release any person or entity liable for any indebtedness
secured hereby without in any way affecting the priority of this Security Deed,
to the full extent of the indebtedness remaining unpaid hereunder, upon any part
of the security not expressly released. Lender may, at its option and within its
sole discretion, also agree with any party obligated on said indebtedness, or
having any interest in the security described herein, to extend the time for
payment of any part or all of the indebtedness secured hereby, and such
agreement shall not, in any way, release or impair this Security Deed, but shall
extend the same as against the title of all parties having any interest in said
security, which interest is subject to this Security Deed.
28. PROPERTY MANAGER. The exclusive manager of the Property shall
be the Borrower or such other manager as may be first approved in writing by
Lender. The exclusive leasing agent of the Property, if other than the foregoing
party, shall be first approved in writing by the Lender. The governing
management and leasing contracts shall be subordinate to this Security Deed and
satisfactory to and subject to the written approval of Lender throughout the
term of the indebtedness secured hereby. Upon default in either of these
requirements, then the whole of the indebtedness hereby secured shall, at the
election of the Lender, become immediately (subject to the cure period for a
Non-Monetary Default) due and payable, together with any default premium and
late payment charges required by the Note, and the Lender shall be entitled to
exercise any or all remedies provided or referenced in this Security Deed.
29. MODIFICATION NOT A WAIVER. In the event Lender: (a) releases,
as aforesaid any part of the security described herein or any person or entity
liable for any indebtedness secured hereby, or (b) grants an extension of time
for the payment of the Note, or (c) takes other or additional security for the
payment of the Note, or (d) waives or fails to exercise any rights granted
herein, in the Note, or any of the other Loan Documents, any said act or
omission shall not release Borrower, subsequent purchasers of the Property or
any part thereof, or makers, sureties, endorsers or guarantors of the Note, if
any, from any obligation or any covenant of this Security Deed, the Note, or any
of the other Loan Documents, nor preclude Lender from exercising any right,
power or privilege herein granted or intended to be granted in the event of any
other default then made, or any subsequent default.
30. TRANSFER OF PROPERTY OR CONTROLLING INTEREST IN BORROWER;
ASSUMPTION. Except as hereafter provided, without the prior written consent of
the Lender, the sale, transfer, assignment, or conveyance of all or any portion
of the Property, or a transfer, assignment, or conveyance of a "controlling
interest" in Borrower whether voluntarily or by operation of law, without the
prior written consent of Lender, shall constitute a default under the terms of
this Security Deed and entitle the Lender, at its sole option, to accelerate all
sums due on the Note together with any Prepayment Premiums, late payment
charges, or any other amounts secured hereby. As used herein the term
"controlling interest" means, in the case of a partnership, greater than a 50%
interest in the partnership or votes greater than 50% of the votes required to
approve any major decisions (as opposed to day-to-day or ministerial decisions)
of
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the partnership, and in the case of a corporation, greater than 50% of the
outstanding voting shares of stock of the corporation. (Notwithstanding the
foregoing sentence, a transfer of partnership interests or partnership units in
the ordinary course of business of Borrower as an "up-REIT" real estate
investment trust structure shall be permitted and shall not constitute a
conveyance of a "controlling interest" in Borrower.) Lender, may, however, elect
to waive the option to accelerate granted hereunder if, prior to any such sale,
transfer, assignment or conveyance of the Property, the following conditions
shall be fully satisfied: (a) the Lender acknowledges in writing that, in its
sole discretion, the creditworthiness of the proposed transferee and the ability
and experience of the proposed transferee to operate the Property are
satisfactory to Lender, and (b) Lender and the proposed transferee shall enter
into an agreement in writing that (i) the interest payable on the indebtedness
secured hereby shall be at such rate as Lender shall determine, (ii) the
repayment schedule as set forth in the Note shall be modified by the Lender in
its sole discretion to amortize the then unpaid principal balance secured hereby
over a period determined by Lender in its sole discretion without a change in
the maturity date of the Note, (iii) an assumption fee to be determined by
Lender may be charged by the Lender in its sole discretion, and (iv) the
proposed transferee shall assume in writing all obligations of Borrower under
the Note, this Security Deed and the other Loan Documents. In the event the
ownership of the Property, or any part thereof, shall become vested in a person
or entity other than the Borrower, whether with or without the prior written
consent of the Lender, the Lender may, without notice to the Borrower, deal with
such successor or successors in interest with reference to the Property, this
Security Deed and the Note in the same manner and to the same extent as with the
Borrower without in any way vitiating or discharging the Borrower's liability
hereunder or under the Note. No sale, transfer or conveyance of the Property, no
forbearance on the part of the Lender and no extension of time for the payment
of the debt hereby secured given by the Lender shall operate to release,
discharge, modify, change or affect the original liability of the Borrower,
either in whole or in part, unless expressly set forth in writing executed by
the Lender. Notwithstanding anything contained herein to the contrary, Borrower
hereby waives any right it now has or may hereafter have to require Lender to
prove an impairment of its security as a condition to exercise the Lender's
rights under this Paragraph 30. If a transfer of the Property, or a portion
thereof, or a transfer of a "controlling interest" in Borrower is approved by
Lender: (a) Lender must receive for its review and approval copies of all
transfer documents, (b) the approved transferee must assume in writing all
obligations under the Note, this Security Deed and any other Loan Documents, and
(c) Borrower or the approved transferee must pay all costs and expenses in
connection with such transfer and assumption, including without limitation, all
fees and expenses incurred by Lender.
Lender acknowledges that Borrower's general partner, Xxxxxxx Realty
Investors, Inc. ("RRII"), is a real estate investment trust and that it is
contemplated that Borrower may convey its interest in the Property to RRII.
Therefore, notwithstanding anything contained in this Paragraph 30 to the
contrary, the prior written consent of the Lender shall not be required and
Lender shall not be entitled to accelerate the indebtedness evidenced by the
Note or change the Loan terms upon a transfer so long as (i) the transfer is
made to RRII; (ii) there is no change in the ownership interest of RRII except
for transfers of shares of the real estate investment trust in the ordinary
course of business; (iii) Lender shall be given prompt notice and documentation
of such transfer, and Borrower shall pay all of Lender's out-of-pocket expenses
associated with such
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transfer; provided, however, that Borrower shall notify Lender in writing of any
such transfer not less than thirty (30) days prior to the effective date of such
transfer; and (iv) RRII shall assume in writing all obligations of Borrower
under the Note, this Security Deed and the other Loan Documents. In addition to
the foregoing, Lender shall permit one (1) bona fide, arm's length transfer of
the Property to any transferee without change in the loan terms; provided,
however, that no such transfer shall be valid or permitted hereunder unless: (i)
Lender receives prior written notice of such proposed transfer, (ii) such
proposed transferee has been approved in writing by the Lender (taking into
account such factors as transferee's creditworthiness, business experience and
managerial capabilities) such approval not to be unreasonably withheld, (iii)
Lender is paid a transfer fee in the amount of one percent (1%) of the then
outstanding principal balance of the Note, (iv) Borrower or the approved
transferee pays all fees and expenses incurred by Lender in connection with such
transfer and assumption, including, without limitation, inspection and
investigation fees and Reasonable Attorneys' Fees (as hereinafter defined), (v)
there is no existing default hereunder or event which with the passage of time
would constitute a default hereunder, and (vi) the transferee shall assume in
writing all obligations of Borrower under the Note, this Security Deed and the
other Loan Documents. Any transfer of all or any portion of the Property which
does not strictly comply with the terms and conditions of the foregoing shall be
a default hereunder and shall entitle the Lender to exercise all rights and
remedies provided in this Security Deed.
31. FURTHER ENCUMBRANCE PROHIBITED; SUBROGATION. So long as the
Note secured hereby remains unpaid, the Borrower shall neither voluntarily nor
involuntarily permit the Property or any part thereof to become subject to any
secondary or other junior lien, mortgage, security interest or encumbrance of
any kind whatsoever other than taxes for the current year and the Permitted
Exceptions, without the prior written consent of the Lender, and the imposition
of any such secondary lien, mortgage, security interest or encumbrance shall
constitute an event of default hereunder and entitle the Lender, at its sole
option, to declare all sums due on account of the Note to be and become
immediately due and payable. In the event that Lender shall hereafter give its
written consent to the imposition of any such secondary lien, mortgage, security
interest or other encumbrance upon the Property, the Lender, at its sole option,
shall be entitled to accelerate the maturity of the Note and exercise any and
all remedies provided and available to Lender hereunder in the event that the
holder of any such secondary lien or encumbrance shall institute foreclosure or
other proceedings to enforce the same; it being understood and agreed that a
default under any instrument or document evidencing, securing or secured by any
such secondary lien or encumbrance shall be and constitute an event of default
hereunder. In the event all or any portion of the proceeds of the loan secured
hereby are used for the purpose of retiring debt or debts secured by prior liens
on the Property, the Lender shall be subrogated to the rights and lien priority
of the holder of the lien so discharged.
32. CONVEYANCE OF MINERAL RIGHTS PROHIBITED. Borrower agrees that
the making of any oil, gas or mineral lease or the sale or conveyance of any
mineral interest or right to explore for minerals under, through or upon the
Property would impair the value of the Property securing the Note, and that the
Borrower shall have no right, power or authority to lease the Property, or any
part thereof, for oil, gas or other mineral purposes, or to grant, assign or
convey any mineral interest of any nature, or the right to explore for oil, gas
and other minerals,
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without first obtaining from the Lender express written permission therefor,
which permission shall not be valid until recorded among the Public Records of
Gwinnett County, Georgia. The Borrower further agrees that if the Borrower shall
make, execute or enter into any such lease or attempt to grant any such mineral
rights without such prior written permission of the Lender, then the Lender
shall have the option, without notice, to declare the same to be a default
hereunder and to declare the indebtedness hereby secured immediately due and
payable. Whether or not the Lender shall consent to such lease or grant of
mineral rights, the Lender shall receive the entire consideration to be paid for
such lease or grant of mineral rights, with the same to be applied to the
indebtedness hereby secured notwithstanding the fact that the amount owing
thereon may not then be due and payable or the said indebtedness is otherwise
adequately secured; provided, however, that the acceptance of such consideration
shall in no way impair the lien of this Security Deed on the Property.
33. ESTOPPEL CERTIFICATION BY BORROWER. Borrower, upon request
therefor made either personally or by mail, shall certify in writing to Lender
(or any party designated by Lender) in form satisfactory to Lender the amount of
principal and interest then outstanding under the terms of the Note and any
other sums due and owing under this Security Deed or any of the other Loan
Documents and whether any offsets or defenses exist against the mortgage debt.
Such certification shall be made by Borrower within ten (10) days if the request
is made personally, or within twenty (20) days if the request is made by mail.
34. CROSS-DEFAULT. The Note is also secured by the terms,
conditions and provisions of an Assignment of Leases, Rents and Profits
(hereinafter referred to as the "Assignment") recorded among the Public Records
of Gwinnett County, Georgia and, additionally, may be secured by contracts or
agreements of guaranty or other security instruments. The terms, conditions and
provisions of each security instrument shall be considered a part hereof as
fully as if set forth herein verbatim. Any default under this Security Deed or
the Note secured hereby shall constitute an event of default under the
Assignment or any of the other Loan Documents, and any default under the
Assignment or other Loan Documents shall likewise constitute a default hereunder
and under the Note. Notwithstanding the foregoing, the enforcement or attempted
enforcement of this Security Deed or any of the other Loan Documents now or
hereafter held by Lender shall not prejudice or in any manner affect the right
of Lender to enforce any other Loan Document; it being understood and agreed
that the Lender shall be entitled to enforce this Security Deed and any of the
other Loan Documents now or hereafter held by it in such order and manner as
Lender, in its sole discretion, shall determine.
35. EXAMINATION OF BORROWER'S RECORDS. Borrower will maintain
complete and accurate books and records showing in detail the income and
expenses of the Property, and will permit upon no less than two (2) days notice
the Lender and its representatives to examine said books and records and all
supporting vouchers and data during normal business hours and from time to time
upon request by the Lender, in such place as such books and records are
customarily kept, and will furnish to the Lender, within one hundred twenty
(120) days after the close of each calendar year, audited financial statements
of each general partner of Borrower and statements of operations of the Property
certified by the general partner of the Borrower to be true and correct and
showing in detail all income derived from and expenses incurred in
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connection with the ownership of the Property. All such statements shall be in
form acceptable to Lender and shall be prepared in accordance with generally
accepted accounting principles and shall include an annual rent schedule. In the
event the Borrower fails to provide such statements to the Lender within the
time prescribed above, the Borrower shall pay the Lender the sum of TWO HUNDRED
AND NO/100 DOLLARS ($200.00) for each successive month for which statements are
delinquent. In the event of default hereunder, Lender shall have the right to
require that said financial statements of the Property be audited and certified
by a certified public accountant acceptable to the Lender, all at the sole cost
and expense of the Borrower.
36. ALTERATION, REMOVAL AND CHANGE IN USE OF PROPERTY PROHIBITED.
Borrower covenants and agrees to permit or suffer none of the following without
the prior written consent of the Lender:
(a) Any structural alteration of, or addition to, the
Improvements now or hereafter situated upon the Real Property or the
addition of any new buildings or other structure(s) thereto other than
erection or removal of non-load bearing interior walls; or
(b) The removal, transfer, sale or lease of the Property,
except that the renewal, replacement or substitution of fixtures,
equipment, machinery, apparatus and articles of personal property
(replacement or substituted items must be of like or better quality
than the removed items in their original condition) encumbered hereby
may be made in the normal course of business; or
(c) The use of any of the Improvements now or hereafter
situated on the Real Property for any purpose other than as an
apartment complex project and related facilities.
37. FUTURE ADVANCES SECURED. This Security Deed shall secure not
only existing indebtedness, but also such future advances, whether such advances
are obligatory or to be made at the option of the Lender. Upon request of
Borrower, and at Lender's option prior to release of this Security Deed, Lender
may make future advances to Borrower. All future advances with interest thereon
shall be secured by this Security Deed to the same extent as if such future
advances were made on the date of the execution of this Security Deed unless the
parties shall agree otherwise in writing, but the total secured indebtedness
shall not exceed at any one time a maximum principal amount equal to double the
face amount of the Note plus interest, and costs of collection including court
costs and Reasonable Attorneys' Fees. Any advances or disbursements made for the
benefit or protection of or the payment of taxes, assessments, levies or
insurance upon the Property, with interest on such disbursements as provided
herein, shall be added to the principal balance of the Note and collected as a
part thereof. To the extent that this Security Deed may secure more than one
note, a default in the payment of any note shall constitute a default in the
payment of all such notes.
38. EFFECT OF SECURITY AGREEMENT. Borrower does hereby grant and
this Security Deed is and shall be deemed to create, grant, give and convey a
mortgage of, a lien and encumbrance upon, and a present security interest in
both real and personal property, including all improvements, goods, chattels,
furniture, furnishings, fixtures, equipment, apparatus,
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appliances and other items of tangible or intangible personal property,
hereinabove particularly or generally described and conveyed, whether now or
hereafter affixed to, located upon, necessary for or used or useful, either
directly or indirectly, in connection with the operation of the Property as an
apartment complex project, and this Security Deed shall also serve as a
"security agreement" within the meaning of that term as used in the Uniform
Commercial Code as adopted and in force from time to time in the State of
Georgia, and shall be operative and effective as a security agreement in
addition to, and not in substitution for, any other security agreement executed
by the Borrower in connection with the extension of credit or loan transaction
secured hereby. Upon the occurrence of a default hereunder or Borrower's breach
of any other covenants or agreements between the parties entered into in
conjunction herewith, Lender shall have the remedies (i) as prescribed herein,
or (ii) as prescribed by general law, or (iii) as prescribed by the specific
statutory consequences now or hereafter enacted and specified in said Uniform
Commercial Code, all at Lender's sole election. Borrower and Lender agree that
the filing of any such financing statement or statements in the records normally
having to do with personal property shall not in any way affect the agreement of
Borrower and Lender that everything used in connection with the production of
income from the Property or adapted for use therein or which is described or
reflected in this Security Deed, is, and at all times and for all purposes and
in all proceedings, both legal or equitable, shall be, regarded as part of the
real estate conveyed hereby regardless of whether (i) any such item is
physically attached to the improvements, (ii) serial numbers are used for the
better identification of certain items capable of being thus identified in an
exhibit to this Security Deed or elsewhere, or (iii) any such item is referred
to or reflected in any such financing statement or statements so filed at any
time. Similarly, the mention in any such financing statement or statements of
the rights in and to (i) the proceeds of any fire and hazard insurance policy,
or (ii) any award in eminent domain proceedings for a taking or for loss of
value, or (iii) Borrower's interest as lessor or landlord in any present or
future lease or rights to income growing out of the use and occupancy of the
Property, whether pursuant to lease or otherwise, shall not in any way alter any
of the rights of Lender as determined by this Security Deed or affect the
priority of Lender's security interest granted hereby or by any other recorded
document, it being understood and agreed that such mention in such financing
statement or statements is solely for the protection of Lender in the event any
court shall at any time hold, with respect to the foregoing clauses (i), (ii) or
(iii) of this sentence, that notice of Lender's priority of interest, to be
effective against a particular class of persons, must be filed in the Uniform
Commercial Code records. Borrower warrants that (i) Borrower's (that is,
"Debtor's") name, identity and residence or principal place of business are as
set forth in Exhibit C attached hereto and made a part hereof; (ii) Borrower
(that is, "Debtor") has been using or operating under said name and identity
without change for the time period set forth in Exhibit C; and (iii) the
location of the collateral is upon the Property. Borrower covenants and agrees
that Borrower will furnish Lender with notice of any change in the matters
addressed by clauses (i) or (iii) of this paragraph within thirty (30) days of
the effective date of any such change and Borrower will promptly execute any
financing statements or other instruments deemed necessary by Lender to prevent
any filed financing statement from becoming misleading or losing its perfected
status. If Borrower fails to promptly execute any such financing statements or
other instruments, Lender may make, execute, record, file, re-record, and
re-file any and all such financing statements or other instruments for and in
the name of Borrower, and Borrower hereby irrevocably appoints Lender the agent
and attorney-in-fact of
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Borrower so to do. This appointment of Lender as Borrower's attorney-in-fact is
coupled with an interest and is irrevocable by death or otherwise. The
information contained in this paragraph is provided in order that this Security
Deed shall comply with the requirements of the Uniform Commercial Code, as
enacted in the State of Georgia, for instruments to be filed as financing
statements. The names of the "Debtor" and the "Secured Party," the identity and
residence or principal place of business of "Debtor," the time period for which
"Debtor" has been using or operating under said name and identity without change
are as set forth in Schedule 1 of Exhibit C; the mailing address of the "Secured
Party" from which information concerning the security interest may be obtained,
and the mailing address of "Debtor," are as set forth in Schedule 2 of said
Exhibit C; and a statement indicating the types, or describing the items, of
collateral is set forth hereinabove.
The Borrower agrees to and shall, upon the request of Lender, execute
and deliver to Lender, in form and content satisfactory to Lender, such
financing statements, descriptions of property and such further assurances as
Lender, in its sole discretion, may from time to time consider necessary to
create, perfect, continue and preserve the lien and encumbrances hereof and the
security interest granted herein upon and in such real and personal property and
fixtures described herein, including all buildings, improvements, goods,
chattels, furniture, furnishings, fixtures, equipment, apparatus, appliances and
other items of tangible and intangible personal property herein specifically or
generally described and intended to be the subject of the security interest,
lien and encumbrance hereby created, granted and conveyed. Without the prior
written consent of Lender, Borrower shall not create or suffer to be created,
pursuant to the Uniform Commercial Code, any other security interest in such
real and personal property and fixtures described herein. The Lender, at the
expense of the Borrower, may or shall cause such statements, descriptions and
assurances, as herein provided in this Paragraph 38, and this Security Deed to
be recorded and re-recorded, filed and refiled, at such times and in such places
as may be required or permitted by law to so create, perfect and preserve the
lien and encumbrance hereof upon all of the Property.
39. TERMS OF CONTRACT SURVIVE CLOSING. The terms and provisions of
the application/contract between Lender and Borrower are incorporated herein by
reference, said application/contract being dated December 19, 1997, and any
subsequent amendment thereto (hereinafter referred to as the "Contract"). All
terms and conditions of the Contract not expressly set forth in this Security
Deed, the Note and any other Loan Documents shall survive the closing hereof and
remain in full force and effect. In the event any conflict exists between the
terms, conditions and provisions of the Contract and the Loan Documents, the
terms, conditions and provisions of the Loan Documents shall prevail.
40. SUCCESSORS AND ASSIGNS; TERMINOLOGY. The provisions hereof
shall be binding upon the Borrower and the successors and assigns of the
Borrower, and inure to the benefit of Lender and its successors and assigns.
Where more than one Borrower is named herein, the obligations and liabilities of
said Borrower shall be joint and several. Wherever used in this Security Deed,
unless the context clearly indicates a contrary intent or unless otherwise
specifically provided herein, the word "Borrower" shall mean Borrower and/or any
subsequent owner or owners of the Property, the word "Lender" shall mean Lender
or any subsequent holder
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or holders of this Security Deed, the word "Note" shall mean Note(s) secured by
this Security Deed, and the word "person" shall mean an individual, trustee,
trust, corporation, partnership or unincorporated association.
41. NOTICES. All notices hereunder shall be deemed to have been
duly given if mailed by United States registered or certified mail, with return
receipt requested, postage prepaid, or if deposited with a nationally recognized
overnight courier such as Federal Express, to the parties at the following
addresses (or at such other addresses as shall be given in writing by any party
to the others), and shall be deemed complete upon receipt (which, in the case of
delivery by certified mail, shall be as evidenced by the return receipt, and, in
the case of delivery by a nationally recognized overnight courier, shall be as
evidenced by the confirmation of delivery received by the courier) or refusal to
accept receipt:
To Borrower: Xxxxxxx Properties Residential, L.P.
0000 Xxxxxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxx
To Lender: Nationwide Life Insurance Company
Xxx Xxxxxxxxxx Xxxxx
Xxxxxxxx, Xxxx 00000-0000
Attn: Real Estate Investments
42. GOVERNING LAW. This Security Deed is to be governed by and
construed in accordance with the laws of the State of Georgia, and, if
controlling, by the laws of the United States.
43. RIGHTS OF LENDER CUMULATIVE. The rights of the Lender arising
under the clauses and covenants contained in this Security Deed shall be
separate, distinct and cumulative and none of them shall be in exclusion of the
others; and no act of the Lender shall be construed as an election to proceed
under any one provision herein to the exclusion of any other provisions,
anything herein or otherwise to the contrary notwithstanding.
44. MODIFICATIONS. This Security Deed cannot be changed, altered,
amended or modified except by an agreement in writing and in recordable form,
executed by both Borrower and Lender.
45. EXCULPATION. Notwithstanding anything contained herein to the
contrary, the liability of Borrower is subject to the limited recoures
provisions contained in the Exculpation section of the Note, which are
incorporated herein and made a part hereof by reference as if fully set forth
herein.
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46. FULL RECOURSE. Notwithstanding any provisions in this Security
Deed to the contrary including without limitation the provisions set forth in
the section captioned "Exculpation" hereinabove, Borrower and the general
partners of Borrower shall be personally liable, jointly and severally, for the
entire amount due under the Note (including all principal, interest and other
charges) in the event that Borrower (i) violates the covenants governing the
placing of subordinate financing on the Property as set forth in paragraph 31 of
this Security Deed or (ii) violates the covenants restricting transfers of
interest in the Property or transfers of ownership interests in Borrower as set
forth in paragraph 30 of this Security Deed.
47. CAPTIONS. The captions set forth at the beginning of the
various paragraphs of this Security Deed are for convenience only and shall not
be used to interpret or construe the provisions of this Security Deed.
48. REASONABLE ATTORNEYS' FEES. As used herein, the phrase
"Reasonable Attorney's Fees" shall mean fees charged by attorneys selected by
Lender based upon such attorney's then prevailing hourly rates, as opposed to
any amount or percentage specified by any statute then in effect in the State of
Georgia.
IN WITNESS WHEREOF, the said Borrower has caused these presents to be
executed under seal by persons duly authorized thereunto as of the day and year
first above written.
Signed, sealed and delivered Xxxxxxx Properties Residential, L.P., a
in the presence of: Georgia limited partnership
/s/ Xxxxxxx X. Xxxxxxx By: Xxxxxxx Realty Investors, Inc.,
---------------------- its sole General Partner
Unofficial Witness
By: /s/ Xxxxxxx X. Xxxxxxx
/s/ Xxxxx X. Xxxxxxxx -------------------------
---------------------- Name: Xxxxxxx X. Xxxxxxx
Notary Public Title: President
My Commission Expires: (CORPORATE SEAL)
(NOTARY SEAL)
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Exhibit "A"
ALL THAT TRACT of land in Land Xxx 000 xx xxx 0xx Xxxxxxxx, Xxxxxxxx Xxxxxx,
Xxxxxxx, described as follows:
TO FIND THE TRUE POINT OF BEGINNING, commence at a point on the south
right-of-way line of Xxxxxx Xxxxx Road (100 foot right-of-way) at the mitered
intersection of the south right-of-way line of Xxxxxx Xxxxx Road with the east
right-of-way line of Peachtree Industrial Boulevard (right-of-way varies);
running thence along the south right-of-way line of Xxxxxx Xxxxx Xxxx Xxxxx 00
degrees 49 minutes 18 seconds East 264.28 feet to a 1/2-inch rebar set at the
TRUE POINT OF BEGINNING; from the TRUE POINT OF BEGINNING as thus established,
continuing thence along the south right-of-way line of Xxxxxx Xxxxx Xxxx Xxxxx
00 degrees 49 minutes 18 seconds East 139.03 feet to a 1/2-inch rebar found;
thence, leaving said right-of-way line, South 20 degrees 08 minutes 58 seconds
East 481.69 feet to a 1/2-inch rebar found; thence South 20 degrees 08 minutes
58 seconds East 38.72 feet to a point in the centerline of a creek; thence,
along said centerline (the property line being the centerline of said creek),
the following courses and distances: (1) South 88 degrees 21 minutes 40 seconds
West 33.50 feet to a point, (2) North 73 degrees 33 minutes 01 second West 68.10
feet to a point, (3) North 37 degrees 09 minutes 32 seconds West 15.73 feet to a
point, (4) North 51 degrees 19 minutes 49 seconds West 44.78 feet to a point,
(5) North 66 degrees 46 minutes 31 seconds West 47.83 feet to a point, (6) North
88 degrees 27 minutes 29 seconds West 47.03 feet to a point, and (7) South 77
degrees 13 minutes 50 seconds West 31.39 feet to a point; thence leaving said
centerline and running along the original centerline of the creek, as currently
identifiable, prior to the new channel taken by the creek as a result of the
installation of the 132 inch corregated metal pipe shown on the survey
hereinafter referred to, the following courses and distances: (1) South 23
degrees 42 minutes 08 seconds East 42.45 feet to a point, (2) North 88 degrees
26 minutes 54 seconds East 30.35 feet to a point, (3) South 15 degrees 06
minutes 32 seconds East 33.53 feet to a point, and (4) South 26 degrees 44
minutes 05 seconds West 61.60 feet to a point in the centerline of a creek;
thence along said centerline (the property line being the centerline of said
creek) the following courses and distances: (1) South 31 degrees 28 minutes 13
seconds East 26.41 feet to a point, (2) South 78 degrees 24 minutes 14 seconds
East 80.25 feet to a point, (3) South 01 degree 11 minutes 32 seconds West 52.57
feet to a point, (4) South 67 degrees 15 minutes 21 seconds East 64.79 feet to a
point, (5) South 42 degrees 02 minutes 18 seconds East 85.35 feet to a point,
(6) North 60 degrees 00 minutes 52 seconds East 34.18 feet to a point, (7) South
34 degrees 52 minutes 46 seconds East 45.08 feet to a point, (8) South 38
degrees 45 minutes 21 seconds West 42.79 feet to a point, (9) South 00 degrees
49 minutes 33 seconds West 16.81 feet to a point, (10) North 77 degrees 37
minutes 26 seconds East 30.94 feet to a point, (11) North 86 degrees 44 minutes
50 seconds East 69.12 feet to a point, (12) South 51 degrees 25 minutes 34
seconds East 35.82 feet to a point, (13) South 28 degrees 43 minutes 27 seconds
West 35.61 feet to a point, (14) South 06 degrees 48 minutes 23 seconds East
15.85 feet to a point, (15) South 38 degrees 44 minutes 37 seconds East 31.48
feet to a point, (16) North
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64 degrees 56 minutes 13 seconds East 52.84 feet to a point, (17) South 28
degrees 49 minutes 50 seconds East 26.19 feet to a point, (18) North 63 degrees
43 minutes 54 seconds East 21.50 feet to a point, (19) South 02 degrees 50
minutes 39 seconds East 86.92 feet to a point, (20) South 04 degrees 21 minutes
36 seconds West 30.31 feet to a point, (21) South 10 degrees 14 minutes 54
seconds East 58.28 feet to a point, (22) South 00 degrees 03 minutes 47 seconds
West 95.91 feet to a point, (23) South 00 degrees 09 minutes 35 seconds East
218.72 feet to a point, (24) South 09 degrees 34 minutes 46 seconds West 122.27
feet to a point, (25) South 29 degrees 19 minutes 11 seconds East 101.50 feet to
a point, (26) South 64 degrees 25 minutes 39 seconds East 37.01 feet to a point,
and (27) South 40 degrees 10 minutes 19 seconds East 52.97 feet to a point on
the land lot line common to Land Xxxx 000 xxx 000 xx xxx 0xx Xxxxxxxx, Xxxxxxxx
Xxxxxx, Xxxxxxx; thence, leaving the centerline of said creek and running along
said common land lot line, the following courses and distances: (1) South 59
degrees 08 minutes 30 seconds West 59.00 feet to a 1/2-inch rebar set, and (2)
South 59 degrees 08 minutes 30 seconds West 1,112.19 feet to a 1/2-inch rebar
found on the southeast right-of-way line of said Peachtree Industrial Boulevard;
thence, along said right-of-way line, the following courses and distances: (1)
North 18 degrees 00 minutes 14 seconds East 267.00 feet to a point, (2) along
the arc of a curve to the left (which arc is subtended by a chord having a
bearing and distance of North 17 degrees 44 minutes 35 seconds East 34.60 feet
and a radius of 2,939.30 feet) 34.60 feet to a concrete monument found, (3)
South 72 degrees 35 minutes 39 seconds East 84.88 feet to a point, (4) North 18
degrees 04 minutes 49 seconds East 63.23 feet to a concrete monument found, (5)
North 73 degrees 47 minutes 30 seconds West 86.29 feet to a concrete monument
found, and (6) along the arc of a curve to the left (which arc is subtended by a
chord having a bearing and distance of North 04 degrees 14 minutes 37 seconds
East 1,218.70 feet and a radius of 2,939.30 feet) 1,227.60 feet to a 1/2-inch
rebar set; thence, leaving said right-of-way line, North 82 degrees 12 minutes
40 seconds East 199.79 feet to a 1/2-inch rebar set; thence North 13 degrees 42
minutes 16 seconds West 286.75 feet to a 1/2-inch rebar set; thence North 65
degrees 03 minutes 28 seconds East 78.49 feet to a 1/2-inch rebar set; thence,
along the arc of a curve to the left (which arc is subtended by a chord having a
bearing and distance of North 20 degrees 03 minutes 28 seconds East 127.28 feet
and a radius of 90.00 feet) 141.37 feet to a 1/2-inch rebar set; thence North 30
degrees 17 minutes 08 seconds West 80.48 feet to a 1/2-inch rebar set; thence
North 20 degrees 10 minutes 42 seconds West 90.00 feet to the TRUE POINT OF
BEGINNING, said tract containing approximately 22.500 acres as shown on plat of
ALTA/ACSM Land Title Survey for Nationwide Life Insurance Company, Xxxxxxx
Properties Residential, L.P. and Commonwealth Land Title Insurance Company
prepared by Rochester & Associates, Inc., bearing the seal and certification of
Xxxxx X. Xxxxx, Georgia Registered Land Surveyor No. 2298, dated May 8, 1998,
last revised May 26, 1998.
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EXHIBIT B
1. General and special taxes and assessments for the year 1998 and
subsequent years, not yet due and payable.
2. The following matters disclosed by that certain ALTA/ACSM Land Title
Survey for Nationwide Life Insurance Company, Xxxxxxx Properties
Residential, L.P., and Commonwealth Land Title Insurance Company,
prepared by Rochester & Associates, Inc. bearing the seal of Xxxxx X.
Xxxxx, Georgia Registered Land Surveyor No. 2298, dated May 8, 1998,
last revised May 26, 1998:
(a) 55 foot building line located along the westerly and northerly
boundary of the subject property;
(b) 10 foot landscape and general utility easement located along
the westerly and northerly boundary of the subject property;
(c) 15 foot landscape buffer located along the easterly boundary
of subject property;
(d) 20-foot sanitary sewer easement, sanitary sewer lines and
manholes traversing the northern, southern and eastern
portions of subject property;
(e) 30 foot drainage easement and 132-inch corrugated metal pipe
traversing the northwesterly boundary of the subject property;
(f) 20 foot drainage easement located along the easterly boundary
of the subject property;
(g) 30 foot slope easement located along the northwesterly
boundary of the subject property;
(h) 30 foot drainage easements traversing the northerly portion of
the subject property;
(i) concrete monument encroachment in southwesterly portion of
subject property;
(j) 40 foot temporary construction easement located in the
northwesterly portion of the subject property;
(k) 20 foot sanitary sewer easement located in the northwesterly
portion of the subject property;
(l) 20 foot drainage easement located in the easterly portion of
subject property;
(m) 15 foot drainage easement, drainage pipe, xxxx inlets and
junction boxes traversing the easterly and westerly portions
of subject property;
(n) 20 foot sanitary sewer easement, sanitary sewer line and
manhole traversing the southerly portion of the subject
property;
(o) concrete wall encroachment over the building line located in
the westerly portion of subject property;
(p) light poles, power poles, guy wires, yard inlets, power boxes,
telephone boxes and cable television boxes and fire hydrants
located throughout the subject property;
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(q) water vaults, water valves and water meters located throughout
the subject property.
3. Rights of upper and lower riparian owners in and to the waters of
rivers, creeks or branches crossing or adjoining the subject property,
and the natural flow thereof, free from diminution or pollution.
4. Any adverse claim based upon the assertion that (a) some portion of the
subject property has been created by artificial means, or has accreted
to such portion so created; or (b) some portion of the subject property
has been brought within the boundaries thereof by an avulsive movement
of the creek adjacent to the subject property, or has been formed by
accretion to any such portion.
5. Easement from Xxx. X.X. Xxxxxxxxx to Georgia Power Company, dated
September 9, 1940, filed for record September 19, 1940, and recorded in
Deed Book 69, page 125, aforesaid records.
6. Easement from Xxx. X.X. Xxxxxxxxx to Georgia Power Company, dated
October 28, 1948, filed for record November 3, 1948, and recorded in
Deed Book 90, page 249, aforesaid records.
7. Sanitary Sewer Easement from Xxxxxxxxx Xxxxxx, Inc. to Tempo Station
Associates, a limited partnership, dated June 11, 1984, filed for
record June 18, 1984, and recorded in Deed Book 2808, page 597,
aforesaid records.
8. Easement from Xxxxxxxxx Xxxxxx, Inc. to Xxxxxx Station Associates, a
Georgia general partnership, dated October 16, 1984, filed for record
November 9, 1984, and recorded in Deed Book 2913, page 413, aforesaid
records.
9. Easement No. 1 as contained in that certain Easement Agreement from
Xxxxxxxxx Xxxxxx, Inc. to Tempo Station Associates, dated October 31,
1984, filed for record April 22, 1985, and recorded in Deed Book 3026,
page 399, aforesaid records.
10. Use covenant contained in Limited Warranty Deed from Dallas
Development, Inc. to Xxxxxxx Properties, Inc., dated December 15, 1994,
filed for record December 21, 1994, and recorded in Deed Book 10943,
page 224, aforesaid records.
11. Water Metering Device Easement from Xxxxxxx Properties Residential,
L.P. to Gwinnett County, dated March 24, 1997, filed for record July
24, 1997 and recorded in Deed Book 14493, page 19, aforesaid records.
12. Easement from Xxxxxxx Properties Residential, L.P. to Georgia Power
Company, dated June 16, 1997, filed for record September 2, 1997 and
recorded in Deed Book 14668, page 125, aforesaid records.
13. Rights of tenants in possession of individual apartment units, as
tenants only.
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EXHIBIT C
Schedule 1
(Description of "Debtor" and "Secured Party")
A. Debtor:
1. Name and Identity or Corporate Structure: Xxxxxxx Properties
Residential, L.P., a Georgia limited partnership.
2. The principal place of business of Debtor in the State of
Georgia is located at 0000 Xxxxxxx Xxxx, Xxxxx 000, Xxxxxxx,
Xxxxxxx 00000.
3. Debtor has been using or operating without change under the
name and identity indicated in item 1 above for the following
time period: Since July 22, 1994.
B. Secured Party:
Nationwide Life Insurance Company
Schedule 2
(Notice Mailing Address of "Debtor" and "Secured Party")
A. The mailing address of Debtor is:
Xxxxxxx Properties Residential, L.P.
0000 Xxxxxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
B. The mailing address of Secured Party is:
Nationwide Life Insurance Company
Xxx Xxxxxxxxxx Xxxxx
Xxxxxxxx, Xxxx 00000-0000
Attn: Real Estate Investments
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