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EXHIBIT 10.1
PROMISSORY NOTE
$8,730,000.00 August 30, 1995
Charlotte, North Carolina
FOR VALUE RECEIVED, the undersigned, SUMMIT PROPERTIES PARTNERSHIP,
L.P., a Delaware limited partnership d/b/a SUMMIT PROPERTIES PARTNERSHIP,
LIMITED PARTNERSHIP ("Maker"), whose address is ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, promises to pay
to the order of Public Employee's Retirement Association of Colorado, an
instrumentality of the State of Colorado ("Holder", which term shall include any
subsequent holder of this Promissory Note), at its office at c/o Invesco Realty
Advisors, Inc., ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇/▇▇ ▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: Asset Management (or at such other place as
Holder shall designate in writing) in lawful money of the United States of
America, the principal sum of Eight Million Seven Hundred Thirty Thousand and
No/100 Dollars ($8,730,000.00), or so much thereof as remains unpaid from time
to time, and as same may be increased from time to time by the addition of
amounts thereto in accordance with the terms and provisions hereof and of the
other Loan Documents, as hereinafter defined, with interest from the date hereof
as hereinafter set forth.
1. Definitions. As used herein, the following terms shall have the
indicated meanings (definitions appear in alphabetical order and defined terms
used within definitions are defined either above or in the appropriate
alphabetical place within this Paragraph 1):
(a) "Advance" - Any sum advanced or expended by Holder
pursuant to the terms of any Loan Document.
(b) "Commitment" - That certain application/commitment letter
dated June 8, 1995, by and between ▇▇▇▇▇▇ and Maker, setting forth,
among other things, the terms and conditions of the Loan.
(c) "Deed of Trust" - That certain Deed of Trust with
Assignment of Rents and Security agreement and Fixture Filing of even
date herewith from Maker for the use and benefit of Holder encumbering
the Property and securing payment of this Promissory Note, as the same
may be amended or replaced from time to time hereafter.
(d) "Default Interest Rate" - An interest rate, compounded
monthly, equal to the lesser of (i) the Interest Rate plus 5%, or (ii)
the maximum legal per annum rate of interest.
(e) "Disbursement Date" - The date of the initial disbursement
of the proceeds of the Loan, or any portion thereof.
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(f) "Due Date" - September 1, 2005.
(g) "Environmental Indemnity" - That certain Environmental
Indemnity Agreement of even date herewith from the Indemnitors relating
to environmental matters with respect to the Property, as the same may
be amended or replaced from time to time hereafter.
(h) "Improvements" - Collectively, all buildings and other
structures and improvements, landscaping and other site work, parking
areas, asphalt, striping, curbs, gutters, sidewalks and other
facilities now or hereafter located on or under the Land.
(i) "Indebtedness" - At any given time during the term of this
Promissory Note, the aggregate of (i) the then Outstanding Principal
Balance and all then accrued and unpaid interest hereunder at the
Interest Rate, and (ii) all other amounts payable hereunder and/or
otherwise evidenced hereby, including, without limitation, any
applicable Early Repayment Premium, as defined in Exhibit A attached
hereto and incorporated herein by this reference, and any accrued and
unpaid interest at the Default Interest Rate, and (iii) all other
amounts then due and payable under the terms of the Deed of Trust and
the other Loan Documents, including, without limitation, the
Environmental Indemnity.
(j) "Indemnitors" - Summit Properties Inc., a Maryland
corporation d/b/a Summit Properties Real Estate Inc., together with
Maker, are the Indemnitors under the Environmental Indemnity.
(k) "Interest Rate" - The rate at which interest is accruing
hereunder as set forth in Paragraph 2(a) hereof.
(l) "Land" - That certain real property located in the County
of Mecklenburg, State of North Carolina, and more particularly
described on Exhibit A attached to the Deed of Trust.
(m) "Loan" - The loan evidenced by this Promissory Note.
(n) "Loan Collateral" - At any given time during the term of
this Promissory Note, collectively, the Property and any and all other
collateral then securing payment of the Indebtedness and the proceeds,
rents, royalties, issues, profits, revenue and all other income, assets
and benefits arising therefrom or attributable thereto.
(o) "Loan Documents" - Collectively, all documents and
instruments now or hereafter evidencing, securing, guaranteeing and/or
relating to the Loan, as the same may be amended or replaced from time
to time hereafter, including, without limitation, the following:
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(1) The Commitment;
(2) This Promissory Note;
(3) The Deed of Trust;
(4) The Environmental Indemnity; and
(5) An Assignment of Leases and Rents, an Assignment
of Contracts, Warranties and Other Rights and a Security
Agreement and related Financing Statements with respect to,
among other things, general intangibles, accounts, equipment,
fixtures and furnishings which are part of the Loan
Collateral.
(p) "Opening Date for Permissible Early Repayment" - September
1, 2000.
(q) "Outstanding Principal Balance" - The principal sum
referred to in the first paragraph of this Promissory Note, less any
principal amounts repaid and increased by any Advances and any other
amounts added to the principal balance hereof pursuant to the terms of
the Loan Documents.
(r) "Property" - The Land, together with the Improvements, all
tangible personal property and fixtures owned by Maker and located in
or on the Land or the Improvements or used in connection therewith, all
of Maker's interest in all intangible personal property related to the
ownership, management and/or operation of the Land, the Improvements
and the above-referenced tangible personal property and fixtures, all
present and future leases, rents and other income with respect thereto
and all other items otherwise included in the definition of "Property"
in the Deed of Trust.
2. Interest.
(a) Interest Rate. From and after the date hereof until the
Due Date, interest shall accrue on the Outstanding Principal Balance (except
that portion, if any, accruing interest at the Default Interest Rate),
calculated pursuant to the method of calculation set forth in subparagraph (b)
below, at a fixed interest rate equal to 8% per annum.
(b) Calculation of Interest. All calculations of interest
hereunder shall be made with reference to the Interest Rate or the Default
Interest Rate, as applicable, and shall be computed (subject to any provisions
of applicable law which limit the maximum allowable interest) based on (i) a
360-day year consisting of twelve 30-day months for each full calendar month and
(ii) the actual number of days in the applicable period for which interest is
being calculated for any partial calendar month, assuming a 365-day year. As an
example of the foregoing calculation for a partial calendar month: If the
Disbursement Date is March 15, the Interest Rate is 10% and the amount accruing
interest at such rate is $1,000,000.00, then the amount of accrued interest that
would be payable on April 1 would be $4,657.53
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(($1,000,000.00 x 10%) + 365 x 17). In computing the number of days during which
interest accrues on any amount outstanding under this Promissory Note, the first
date from which such interest is stated to accrue hereunder shall be included
and, provided that the payment in question is received by Holder prior to 11:00
A.M., Central Time, the date of payment of such amount to Holder shall be
excluded.
(c) Default Interest and Charges. In the event that any
payment of principal and/or interest hereunder is not received by Holder within
fifteen (15) days after the due date thereof, Maker shall pay to Holder a late
charge in an amount equal to 4$ of the amount of such overdue payment (unless a
late charge in such amount is usurious or prohibited by applicable law, in which
event the highest non-usurious late charge permitted by applicable law shall be
used). In addition to the late charge referred to above, if any such payment is
not made when due or if the entire Outstanding Principal Balance and all accrued
but unpaid interest hereunder is not paid in full on the Due Date, or in the
event any other default occurs under any of the Loan Documents and such default
is not cured within any applicable cure period, then from and after the date
such default shall have occurred, the entire amount of the Indebtedness shall
bear interest, calculated pursuant to the method of calculation set forth in
subparagraph (b) above, at the Default Interest Rate (unless interest in such
amount is usurious or prohibited by the applicable law, in which event the
highest non-usurious interest rate permitted by applicable law shall be used).
The Default Interest Rate shall be in lieu of any other interest rate otherwise
applicable and shall commence, without notice, immediately upon and from the
occurrence of such default and shall continue until the entire amount of the
Indebtedness is paid in full. Notwithstanding the foregoing, nothing set forth
in this subparagraph shall imply any obligation on the part of Holder to accept
any payment not made within any applicable cure period. Maker acknowledges that
it would be extremely difficult or impracticable to determine ▇▇▇▇▇▇'s actual
damages resulting from any late payment and the aforementioned late charge and
default interest are reasonable estimates of those damages.
3. Monthly Installments.
(a) If the Disbursement Date is other than the first day of a
calendar month, then, on the first day of the calendar month immediately
following the month in which the Disbursement Date occurs, interest only at the
Interest Rate, calculated pursuant to the method of calculation set forth in
Paragraph 2(b) hereof, shall be due and payable hereunder for the period from
the Disbursement Date to such payment date.
(b) Commencing on the first day of the second full calendar
month following the Disbursement Date (or the first day of the first full
calendar month following the Disbursement Date if the Disbursement Date is the
first day of a calendar month) and continuing on the first day of each calendar
month thereafter until the Due Date, equal monthly installments of principal and
interest, each in the amount of $64,057.65, shall be due and payable hereunder.
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4. Maturity Date. The maturity date of this Promissory Note shall be
the Due Date, at which time the entire Indebtedness shall be due and payable in
full.
5. Early Repayment.
(a) Repayment Prohibited. Maker is prohibited from repaying
any portion of the Outstanding Principal Balance prior to the Opening Date for
Permissible Early Repayment.
(b) Permissible Early Repayment with Premium. From and after
the Opening Date for Permissible Early Repayment to that date which is 90 days
prior to the Due Date, provided that Holder shall have received at least 60 days
prior written notice thereof, Maker may repay, in full only, the Indebtedness,
provided that such repayment is accompanied by an Early Repayment Premium, as
calculated in accordance with the provisions of Exhibit A hereto. Maker agrees
that ▇▇▇▇▇▇ shall not be obligated to actually reinvest the amount repaid in any
treasury obligations as a condition precedent to receiving the Early Repayment
Premium.
(c) Permissible Early Repayment without Premium. From and
after that date which is 90 days prior to the Due Date until the Due Date,
provided that Holder shall have received at least 20 days prior written notice
thereof, Maker may repay, in full only, the Indebtedness without premium, fee or
penalty.
(d) Repayment on Condemnation or Casualty. Partial (or full)
repayments of the Outstanding Principal Balance are permitted when no default
exists hereunder or under the other Loan Documents is such repayment results
from the application of insurance or condemnation proceeds to reduce the
Outstanding Principal Balance as provided in the Deed of Trust, in which event
no repayment premium, fee or penalty shall be due. No notice of repayment shall
be required under the circumstance specified in the preceding sentence. Any such
partial repayments of principal shall be applied to the Outstanding Principal
Balance and the amount of the fixed monthly installments required to be paid
hereunder pursuant to Paragraph 3(b) above shall thereafter be adjusted to an
amount which would have been effect had the original principal amount of the
Loan been equal to (i) minus (ii), where (i) is the fact amount of this
Promissory Note and (ii) is the aggregate of all principal repayments, if any,
previously made under the circumstances specified in this subparagraph plus the
amount of the principal repayment then being made. No principal amount repaid
may be reborrowed.
(e) Premium Payable on Default. If the maturity date of this
Promissory Note is accelerated following an uncured default hereunder or under
the other Loan Documents and a repayment under this Promissory Note is made
thereafter, then, if such repayment takes place prior to that date which is 90
days prior to the Due Date, Holder shall be entitled to receive the Early
Repayment Premium calculated as of the date of such repayment and based on the
entire amount repaid. Furthermore, if such repayment takes place prior to the
Opening Date for Permissible Early Repayment, and results from non-payment of
any amounts due
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under the Loan Documents or from waste caused by or not repaired by Maker, the
same shall be presumed to be and conclusively deemed to constitute a deliberate
evasion of the provisions of this Paragraph 5 and shall constitute an
unpermitted early repayment entitling Holder to, inaddition to all of the other
Indebtedness, the Early Repayment Premium plus an additional premium in an
amount equal to 5% of the principal amount repaid.
6. Application of Payments. For so long as Maker is not in default
hereunder or under any of the other Loan Documents beyond any applicable cure
period, all payments received by Holder on this Promissory Note shall be applied
as follows, regardless of any designation elsewhere herein of such payments as
principal, interest or other charges: first, to the repayment of sums advanced
by Holder pursuant to the terms of any of the Loan Documents for the payment of
taxes, assessments, insurance premiums or other charges against the Property
(together with interest thereon from the date of advance until the date repaid
at the Default Interest Rate), then to the payment of any outstanding late
charges, then to the payment of accrued but unpaid interest which is then due
and payable, and finally, to reduction of the Outstanding Principal Balance and
any remaining Indebtedness. From and after a default hereunder or under any of
the other Loan Documents which has not been cured within any applicable cure
period, all payments received by Holder on this Promissory Note shall be applied
by Holder to the Indebtedness in such order as Holder shall determine in its
sole subjective discretion.
7. Default. Time is of the essence hereof. The occurrence of any of the
following events shall be a default hereunder and, if such default is not cured
within any applicable cure period specified herein, the payment of all principal
and interest due in accordance with the terms of this Promissory Note and all
other Indebtedness shall, at the option of Holder, be accelerated and such
principal, interest and other Indebtedness, together with any Early Repayment
Premium and any additional premium payable pursuant to the terms of Paragraph 5
hereof, shall be immediately due and payable without notice or demand, and
Holder shall have the option to foreclose or to require foreclosure of any or
all liens securing the payment hereof and/or to exercise any other rights and
remedies available to Holder hereunder or under the other Loan Documents:
(a) Failure to make any payment hereunder in full when due,
including, without limitation, failure to pay in full the Indebtedness
on the Due Date.
(b) Breach or violation by Maker of any other agreement or
covenant contained herein. Maker shall have 15 days after receipt of a
written notice from Holder specifying a default under this subparagraph
(b) within which to cure such default. If, however, such default is of
a nature that it cannot be cured within such 15- day period, Maker
shall have a reasonable period of time (not to exceed in any event 90
days after receipt of such notice from Holder) within which to cure
such default on the condition that Maker shall, immediately upon
receipt of such notice from Holder, commence diligent good faith
efforts to cure such default and demonstrate continuous
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diligent good faith efforts throughout such cure period to cure such
default in a manner satisfactory to Holder.
(c) Breach or violation of any covenant or agreement set forth
in any of the other Loan Documents or any other default thereunder
(unless such default is cured within any applicable cure period set
forth in the applicable Loan Document).
Any default hereunder which has not been cured within any applicable cure period
shall be a default under each of the other Loan Documents.
8. Character of Loan. Maker certifies that the Loan is obtained for
business or commercial purposes and that the proceeds thereof will not be used
primarily for personal, family, household or agricultural purposes.
9. Security and Due on Sale. The payment and performance of this
Promissory Note is secured by the Deed of Trust and the other security documents
which are a part of the Loan Documents. The Loan Documents contain, among other
things, a description of the properties encumbered and pledged as security for
payment of this Promissory Note, the nature and extent thereof and the rights of
Holder and Maker with respect thereto. In particular, Section 1.11 of the Deed
of Trust contains terms and provisions placing limitations and restrictions on
the sale, conveyance, disposition, alienation, hypothecation, leasing,
assignment, pledging, mortgaging, granting of security interests in and other
transferring or further encumbering of the Property and said terms and
provisions are incorporated herein by this reference.
10. GOVERNING LAW. MAKER AND ▇▇▇▇▇▇ AGREE THAT THE TERMS AND PROVISIONS
OF THIS PROMISSORY NOTE AND THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NORTH CAROLINA EXCEPT TO
THE EXTENT THAT ANY OF SUCH LAWS MAY NOT OR HEREAFTER BE PREEMPTED BY FEDERAL
LAW, IN WHICH CASE, SUCH FEDERAL LAW SHALL SO GOVERN AND BE CONTROLLING. MAKER
AND HOLDER EACH HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY STATE COURT
OF THE STATE OF NORTH CAROLINA OR FEDERAL COURT SITTING IN SUCH STATE IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS PROMISSORY NOTE OR THE
OTHER LOAN DOCUMENTS, AND MAKER AND HOLDER EACH HEREBY IRREVOCABLY AGREE THAT
ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED
IN SUCH STATE OR FEDERAL COURT. MAKER AND HOLDER AGREE THAT A FINAL JUDGMENT NOT
SUBJECT TO APPEAL, IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY
BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER
MANNER PROVIDED BY LAW.
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11. Remedies Cumulative; Waiver. The remedies of Holder provided herein
or in any of the other Loan Documents shall be cumulative and concurrent, may be
pursued singularly, successively or together, at the sole discretion of Holder,
and may be exercised as often as occasion therefor shall arise. No act of
omission or commission of Holder, including specifically any failure to exercise
any right, remedy or recourse, shall be deemed to be a waiver or release of any
provision of this Promissory Note by ▇▇▇▇▇▇, such waiver or release to be
effected only through a written document executed by ▇▇▇▇▇▇ and then only to the
extent specifically recited therein. A waiver or release with reference to any
one event shall not be construed as continuing, as a bar to, or as a waiver or
release of any subsequent right, remedy or recourse as to a subsequent event.
Acceptance by Holder of any payment after the due date thereof shall not be
deemed to be a waiver of any default with respect to such payment or an
extension of the due date of any such payment or the due date of any other
payment. Furthermore, acceptance by Holder of any payment in an amount less than
the amount then due hereunder or under the other Loan Documents shall be an
acceptance on account only and shall not in any way affect the existence of a
default hereunder or under the other Loan Documents.
12. Notice. All notices, demands, requests or other communications to
be sent by one party to the other hereunder or under the other Loan Documents or
required by law shall be in writing and shall be deemed to have been validly
given or served by delivery of the same in person to the intended addressee, or
by depositing the same with FedEx or another reputable private courier service
for next business day delivery to the intended addressee at its address set
forth below or at such other address as may be designated by such party as
herein provided, or by depositing the same in the United States mail, postage
prepaid, registered or certified mail, return receipt requested, addressed to
the intended addressee at its address set forth below or at such other address
as may be designated by such party as herein provided. All notices, demands and
requests shall, for the purposes of this Promissory Note, be deemed received
upon such personal delivery, or one business day after being deposited with the
private courier service, or two business days after being deposited in the
United States mail as required above. By giving to the other party hereto at
least 15 days' prior written notice thereof in accordance with the provisions
hereof, the parties hereto shall have the right from time to time to change
their respective addresses and each shall have the right to specify as its
address any other address within the United States of America. The initial
addresses for the parties hereto shall be:
If to Holder: Public Employee's Retirement Association of Colorado,
an instrumentality of the State of Colorado
c/o Invesco Realty Advisors
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇/▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Asset Management
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
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With copy to: Brownstain Hyatt ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇, P.C.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-4437
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
If to Maker: Summit Properties Partnership, L.P.
d/b/a Summit Properties Partnership, Limited Partnership
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
With copy to: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, L.L.P.
NationsBank Corporate Center
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-4006
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
13. Recourse.
(a) Except as otherwise set forth in this Paragraph 13, the
recourse of Holder under this Promissory Note and the other Loan Documents shall
be limited to the Loan Collateral.
(b) Notwithstanding the foregoing:
(1) nothing contain in this Paragraph 13 shall:
(i) preclude Holder from foreclosing the lien of
the Deed of Trust or from exercising and enforcing any of its
other rights or remedies provided for in the Deed of Trust or
in the other Loan Documents or at law or in equity, except as
expressly stated in this Paragraph 13;
(ii) constitute a waiver, release or impairment of
any of the Indebtedness or of any obligation set forth in this
Promissory Note, the Deed of Trust or any other Loan Document;
(iii) limit the right of Holder to name Maker or any
other person or entity as a party defendant in any action
brought under this Promissory Note, the Deed of Trust or any
other Loan Document so long as execution on any judgment is
limited to the Loan Collateral;
(iv) prohibit Holder from pursuing all of its rights
and remedies (A) against Maker, the general partner in Maker,
the Indemnitors or any other person or entity under the
Environmental Indemnity or under any
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other indemnity, certificate, affidavit, bond or other
document in which ▇▇▇▇▇▇'s recourse is not expressly limited
to the Loan Collateral, or (B) against any guarantor or surety
of the obligations of Maker, whether or not such guarantor or
surety is a partner or otherwise owns any interest in Maker;
and
(2) Holder shall have full recourse against Maker and the
general partner in Maker, and Maker and such general partner, shall be
personally liable for and will promptly account to Holder for all loss,
damage, costs and expenses, including, without limitation, attorneys'
fees, sustained by Holder resulting from fraud or intentional
misrepresentation on the part of Maker or the general partner in Maker,
or waste committed on the Land or the Improvements or damages to the
Loan Collateral caused by the gross negligence or willful Loan
Collateral caused by the gross negligence or willful misconduct of
Maker or such general partner, or misappropriation or misapplication of
funds. (Examples of "misapplication of funds" are (without limiting the
application of such phrase to their actions): (A) rents, issues,
profits or other income with respect to the Loan Collateral that are
received by Maker or the general partner in Maker or any other person
or entity after the occurrence of a default under the Loan Documents
(unless such default is subsequently cured as allowed in the Loan
Documents or waived by Holder) and are not used to pay customary and
normal operating and maintenance expenses, real estate taxes or
assessments or reasonable capital expenditures with respect to the Loan
Collateral; (B) rents, issues, profits or other income payments with
respect to the Loan Collateral that are prepaid more than 30 days in
advance and not subsequently delivered to Holder, but only if such
prepayment results in a credit in favor of the applicable entity making
such payment as of the date of a default under any of the Loan
Documents; (C) security deposits or other funds or deposits that are
held by Maker or its agents pursuant to arrangements with tenants in
the Improvements and are not segregated and continuously held as trust
funds subject to the terms and provisions of the applicable leases; and
(D) casualty insurance or condemnation award proceeds that are released
to Maker and not applied as required in the Deed of Trust).
(3) Furthermore, Holder shall have full recourse against Maker
and the general partner in Maker, and Maker and such general partner,
shall have full personal liability for, the obligation to pay the
entire Indebtedness, and all of the nonrecourse provisions set forth in
this Paragraph 13 shall be completely ineffective, upon the institution
and during the continuance of any petition or proceeding in bankruptcy
or reorganization or any similar proceeding under any provisions of any
Federal or State bankruptcy or insolvency statute filed or instituted
by Maker and/or by such general partner. Furthermore, such recourse and
personal liability shall continue after the final termination or
dismissal of any such petition or proceeding described above to the
extent that such petition or proceeding causes or results in any loss
to Holder or any diminution in the value of the security afforded by
the Property or any of the other Loan Collateral.
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14. Principal Balance of this Promissory Note. Notwithstanding the
amount set forth on the face of this Promissory Note as the stated principal
amount, it is the intention of Maker and Holder that the principal balance of
this Promissory Note be increased by amounts, if any, which are added thereto
pursuant to the terms hereof and/or the terms of the Deed of Trust or the other
Loan Documents and, even though such additions may increase the principal
balance of this Promissory Note to an amount greater than said face amount, the
entire amount of the principal balance, including such additions, is intended to
be evidenced by this Promissory Note and secured by the Deed of Trust and the
other Loan Documents.
15. Miscellaneous.
(a) All payments made on this Promissory Note, including,
without limitation, payment in full on the Due Date, must be received by Holder
at ▇▇▇▇▇▇'s office as described on the first page of this Promissory Note by
11:00 A.M., Central Time, in order to be credited as a payment received that
date. With respect to a payment in full of this Promissory Note, the same shall
be made by cash payment or wire transfer. With respect to any other payments
made hereunder, such payments may be made by cash, wire transfer or check, at
Maker's option. Any payments made by check shall be provisionally credited upon
receipt and in the event the check is dishonored, then any penalties or late
charges shall run from the appropriate due date. Notwithstanding the foregoing,
Holder may, at its option, at any time require that all payments be made
hereunder by wire transfer to an account designated by ▇▇▇▇▇▇.
(b) Each maker, endorser, cosigner and guarantor of this
Promissory Note hereby expressly grants to Holder the right to release or to
agree not to sue any other person, or to suspend the right to enforce this
Promissory Note against such other person or to otherwise discharge such person;
and each such maker, endorser, cosigner and guarantor hereby agrees that the
exercise of such rights by Holder shall have no effect on the liability of any
other person, primarily or secondarily liable hereunder. Each maker, endorser,
cosigner and guarantor of this Promissory note hereby waives demand for payment,
presentment for payment, protest, notice of protest, notice of dishonor, notice
of nonpayment, notice of intent to accelerate maturity, notice of acceleration
of maturity, diligence in taking any action to collect sums owing hereunder and
all duty or obligation of Holder to effect, protect, perfect, retain or enforce
any security for the payment of this Promissory Note or to proceed against any
collateral before otherwise enforcing this Promissory Note.
(c) Maker agrees to reimburse Holder for all costs, including,
without limitation, attorneys' fees, incurred from time to time to collect any
payment under this Promissory Note. Maker agrees that ▇▇▇▇▇▇ may from time to
time extend the maturity date of this Promissory Note or the time any payment is
due under this Promissory Note and may accept further security or release
security for the payment of this Promissory Note, without in any way affecting
the obligation of Maker to Holder.
11
12
(d) If any provision hereof or of any other Loan Document is,
for any reason and to any extent, invalid or unenforceable, then neither the
remainder of the document in which such provision is contained nor application
of the provision to other persons, entities or circumstances shall be affected
thereby, but instead shall be enforceable to the maximum extent permitted by
law.
(e) Each payment of principal and interest hereunder shall be
paid when due without deduction or setoff of any kind or nature or for any costs
whatsoever.
(f) The headings of the paragraphs and sections of this
Promissory Note are for convenience of reference only, are not to be considered
a part hereof and shall not limit or otherwise affect any of the terms hereof.
(g) This Promissory Note shall be binding upon Maker and its
successors and assigns.
(h) This Promissory Note may not be terminated or amended
orally, by only by a termination in writing signed by ▇▇▇▇▇▇ or an amendment in
writing signed by ▇▇▇▇▇▇ and Maker.
(i) When the context and construction so require, all words
used in the singular herein shall be deemed to have been used in the plural and
the masculine shall include the feminine and neuter and vica versa. The word
"person" as used herein shall include any individual, company, firm,
association, partnership, corporation, trust or other legal entity of any kind
whatsoever.
(j) In the event that at any time any payment received by
Holder hereunder shall be deemed by final order of a court of competent
jurisdiction to have been a voidable preference or fraudulent conveyance under
the bankruptcy or insolvency laws of the United States, or shall be deemed to be
otherwise due to any party other than Holder, then, in any such event, the
obligations to make such payment shall survive any cancellation of this
Promissory Note and/or return thereof to Maker, shall not be discharged or
satisfied by any prior payment thereof and/or cancellation of this Promissory
Note, but shall remain a valid and binding obligations enforceable in accordance
with the terms and provisions hereof, and the amount of such payment shall bear
interest at the Default Interest Rate from the date of such final order under
repaid hereunder.
(k) The provisions of this Promissory Note and of all
agreements between Maker and Holder, whether nor existing or hereafter arising
and whether written or oral, are hereby expressly limited so that in no
contingency or event whatsoever, whether by reason of demand or acceleration of
the maturity of this Promissory Note or otherwise, shall the amount paid or
agreed to be paid ("Interest") to Holder for the use, forebearance or retention
of the money to be loaned hereunder exceed the maximum amount permissible under
applicable law. If, from any circumstances whatsoever, Interest paid to Holder
in connection with the
12
13
performance or fulfillment of any provision hereof or of any agreement between
Maker and Holder shall, at the time performance or fulfillment of such provision
shall be due, exceed the limit for Interest prescribed by law, then ispo facto
the Interest payable in connection with such obligation to be performed or
fulfilled shall be reduced to such limit and if, from any circumstance
whatsoever, Holder should ever receive as Interest an amount which would exceed
the highest lawful rate, the amount which would be excessive Interest shall be
applied to the reduction of the principal balance owing hereunder in the inverse
order of its maturity (whether or not then due) or at the option of Holder be
paid over the Maker, and not to the payment of Interest. All Interest (including
any amounts or payments deemed to be Interest) paid or agreed to be paid to
Holder shall, to the extent permitted by applicable law, be amortized, prorated,
allocated and spread throughout the full period until payment in full of the
principal balance of this Promissory Note (including the period of any renewal
or extension hereof) so that the Interest hereon for such full period will not
exceed the maximum amount permitted by applicable law. This paragraph will
control all agreements between Maker and Holder.
13
14
IN WITNESS WHEREOF, Maker has executed this Promissory Note as of the
day and year first above written.
SUMMIT PROPERTIES PARTNERSHIP, L.P.,
d/b/a SUMMIT PROPERTIES PARTNERSHIP,
LIMITED PARTNERSHIP
By: SUMMIT PROPERTIES, INC.,
d/b/a SUMMIT PROPERTIES REAL ESTATE,
INC., its General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President
ATTEST:
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Assistant Secretary
[Affix Corporate Seal]
STATE OF NORTH CAROLINA
COUNTY OF MECKLENBURG
I, ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, a Notary Public of Mecklenburg county and state
aforesaid, certify ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ personally came before me this day and
acknowledged (s)he is Assistant Secretary of SUMMIT PROPERTIES, INC., a Maryland
corporation d/b/a Summit Properties Real Estate Inc.; itself the general partner
of SUMMIT PROPERTIES PARTNERSHIP, L.P., a Delaware limited partnership d/b/a
Summit Properties Limited Partnership; and that, by authority duly given and as
the act of the corporation, the foregoing instrument was signed by the corporate
general partner's Senior Vice President, sealed with its corporate seal, and
attested by himself/herself as its Assistant Secretary, all as the act and deed
of SUMMIT PROPERTIES PARTNERSHIP, L.P., a Delaware limited partnership d/b/a
Summit Properties Limited Partnership.
Witness my hand and notarial seal, this 30th day of August, 1995.
/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------------
Notary Public
My commission expires:
10-2-96
(Notary Seal)
14
15
EXHIBIT A
EARLY REPAYMENT PREMIUM
The term "Early Repayment Premium" shall mean the greater of (a) an
amount equal to one percent of the entire outstanding principal balance of the
Note on the date repaid, or (b) an amount (the "Loss of Yield Amount"), if any,
calculated as provided below. As used in the following calculation, the term
"Treasury Yield" shall mean the sum of (i) the "ask" yield for the then most
recently issued United States Treasury obligations (excluding those commonly
known as "flower bonds") with a maturity date (month and year) as close as
possible to the Due Date (month and year) using the average of the yield rates
as most recently published in the Western Edition of the Wall Street Journal or,
if the Western Edition of the Wall Street Journal no longer publishes such
information, in another authoritative source selected by ▇▇▇▇▇▇, minus (ii) the
Basis Point Adjustment as computed in accordance with Exhibit A-1 attached
hereto. The term "Discount Rate" shall mean a rate which is equivalent to
one-twelfth of the Treasury Yield.
The "Loss of Yield Amount" shall be the result of, if a positive
number, (x) minus (y) where "(x)" is the aggregate amount of all scheduled
payments of principal and interest on this Promissory Note at the Interest Rate
from the date of such repayment to and including the Due Date, with reach such
payment discounted to present value on a monthly basis using a discount rate
equal to the Discount Rate, and "(y)" is the Outstanding Principal Balance as of
the early repayment date.
SEE ATTACHED EXAMPLE OF CALCULATION OF EARLY REPAYMENT PREMIUM.
A-1
16
EXHIBIT A-1
BASIS POINT ADJUSTMENT TABLE
U.S. Treasury Bonds Basic Point U.S. Treasury Bond Basis Point
or Note Yield Adjustment or Note Yield Adjustment
-----------------------------------------------------------------------------------------------------------
0 - 1.55 .0 14.25 - 14.41 .41
1.56 - 2.69 .01 14.41 - 14.59 .42
2.70 - 3.48 .02 14.60 - 14.77 .43
3.49 - 4.12 .03 14.78 - 14.84 .44
4.13 - 4.68 .04 14.95 - 15.11 .45
4.69 - 5.17 .05 15.12 - 15.28 .46
5.18 - 5.63 .06 15.29 - 15.44 .47
5.64 - 6.05 .07 15.45 - 15.61 .48
6.06 - 6.44 .08 15.62 - 15.77 .49
6.45 - 6.82 .09 15.78 - 15.94 .50
6.83 - 7.17 .10 15.95 - 16.10 .51
7.18 - 7.51 .11 16.11 - 16.26 .52
7.52 - 7.83 .12 16.27 - 16.41 .53
7.84 - 8.14 .13 16.42 - 16.57 .54
8.15 - 8.44 .14 16.58 - 16.73 .55
8.45 - 8.73 .15 16.74 - 16.88 .56
8.74 - 9.02 .16 16.89 - 17.03 .57
9.03 - 9.29 .17 17.04 - 17.18 .58
9.30 - 9.55 .18 17.19 - 17.33 .59
9.56 - 9.81 .19 17.34 - 17.48 .60
9.82 - 10.07 .20 17.49 - 17.63 .61
10.08 - 10.31 .21 17.64 - 17.78 .62
10.32 - 10.55 .22 17.79 - 17.92 .63
10.56 - 10.79 .23 17.93 - 18.01 .64
10.80 - 11.02 .24 18.08 - 18.21 .65
11.03 - 11.25 .25 18.22 - 18.35 .66
11.26 - 11.47 .26 18.36 - 18.49 .67
11.48 - 11.69 .27 18.50 - 18.63 .68
11.70 - 11.90 .28 18.64 - 18.77 .69
11.91 - 12.11 .29 18.78 - 18.91 .70
12.12 - 12.32 .20 18.92 - 19.05 .71
12.33 - 12.52 .31 19.06 - 19.18 .72
12.53 - 12.72 .32 19.19 - 19.32 .73
12.73 - 12.92 .33 19.33 - 19.45 .74
12.93 - 13.12 .34 19.46 - 19.59 .75
13.13 - 13.31 .35 19.60 - 19.72 .76
13.32 - 13.50 .36 19.73 - 19.85 .77
13.51 - 13.69 .37 19.86 - 19.99 .78
13.70 - 13.87 .38 20.00 - 20.12 .79
13.88 - 14.06 .39
14.07 - 14.24 .40
A1-1
17
EXAMPLE OF EARLY REPAYMENT PREMIUM CALCULATION
Original Loan Amount $8,730,000
Interest Rate - Per Annum 8.00%
Amortization Schedule 30 Years
Debt Service Constant - Per Annum 8.81%
Monthly Debt Service $64,058
Original Term 10 Years
Proposed Repayment Date 3rd Anniversary
Proposed Repayment Amount $8,492,557 *
ASSUMED YIELD TO MATURITY OF TREASURY SECURITY 6.50%
LESS: BASIS POINT ADJUSTMENT ** 0.09%
TREASURY YIELD ** 6.41%
DISCOUNT RATE ** 0.5342%
SCHEDULE OF REMAINING LOAN PAYMENTS
Debt Service Balloon Total
------------ ------- -----
1 $ 64,058 $ 64,058
2 64,058 64,058
3 64,058 64,058
4 64,058 64,058
5 64,058 64,058
6 64,058 64,058
7 64,058 64,058
8 64,058 64,058
9 64,058 64,058
10 64,058 64,058
11 64,058 64,058
12 64,058 64,058
13 64,058 64,058
14 64,058 64,058
15 64,058 64,058
16 64,058 64,058
17 64,058 64,058
18 64,058 64,058
19 64,058 64,058
20 64,058 64,058
21 64,058 64,058
22 64,058 64,058
23 64,058 64,058
24 64,058
$8,299,598 * $8,363,656
GRAND TOTAL OF REMAINING PAYMENTS $9,836,990
NET PRESENT VALUE OF REMAINING PAYMENTS $8,742,786
PROPOSED REPAYMENT AMOUNT $8,492,557
----------
LOSS OF YIELD AMOUNT ** $250,229 ***
* See attached amortization schedule.
** As defined in Exhibit A - Early Repayment Premium - to which this
example is attached.
*** Because the Loss of Yield Amount is greater than 1% of the entire
outstanding principal balance being repaid, the Early Retirement
Premium will be equal to the Loss of Yield Amount.
18
AMORTIZATION SCHEDULE
INTEREST RATE: 8.00%
ORIGINAL MORTGAGE BALANCE: $8,730,000
AMORTIZATION SCHEDULE: 30 YEARS
TERM: 10 YEARS
MONTHLY DEBT SERVICE: $64,058
BEGINNING DEBT ENDING
--------------------------------------------------------- --------------------------------------------
MO BALANCE SERVICE INT AMORT BALANCE
1 8,730,000 64,058 58,200 5,858 8,724,142
2 8,724,142 64,058 58,161 5,897 7,718,246
3 7,718,246 64,058 58,122 5,936 8,712,310
4 8,712,310 64,058 58,082 5,976 8,706,334
5 8,706,334 64,058 58,042 5,015 8,700,319
6 8,700,319 64,058 58,002 5,056 8,694,263
7 8,694,263 64,058 57,962 5,096 8,688,167
8 8,688,167 64,058 57,921 6,137 8,682,031
9 8,682,031 64,058 57,880 6,177 8,675,853
10 8,675,853 64,058 57,839 6,219 8,669,635
11 8,669,635 64,058 57,798 6,260 8,663,375
12 8,663,375 64,058 57,756 6,302 8,657,073
13 8,657,073 64,058 57,714 6,344 8,650,729
14 8,650,729 64,058 57,672 6,386 8,644,343
15 8,644,343 64,058 57,629 6,429 8,637,914
16 8,637,914 64,058 57,586 6,472 8,631,443
17 8,631,443 64,058 57,543 6,515 8,624,928
18 8,624,928 64,058 57,500 6,558 8,618,370
19 8,618,370 64,058 57,456 6,602 8,611,768
20 8,611,768 64,058 57,412 6,646 8,605,122
21 8,605,122 64,058 57,367 6,690 8,598,432
22 8,598,432 64,058 57,323 6,735 8,591,697
23 8,591,697 64,058 57,278 6,780 8,584,917
24 8,584,917 64,058 57,233 6,825 8,578,093
25 8,578,093 64,058 57,187 6,870 8,571,222
26 8,571,222 64,058 57,141 6,916 8,564,306
27 8,564,306 64,058 57,095 6,962 8,557,344
28 8,557,344 64,058 57,049 7,009 8,550,335
29 8,550,335 64,058 57,002 7,055 8,543,280
30 8,543,280 64,058 56,955 7,102 8,536,177
31 8,536,177 64,058 56,908 7,150 8,529,027
32 8,529,027 64,058 56,860 7,197 8,521,830
33 8,521,830 64,058 56,812 7,245 8,514,583
34 8,514,583 64,058 56,764 7,294 8,507,291
35 8,507,291 64,058 56,715 7,342 8,499,948
36 8,499,948 64,058 56,666 7,391 8,492,557
37 8,492,557 64,058 56,617 7,441 8,485,116
38 8,485,116 64,058 56,567 7,490 8,477,626
39 8,477,626 64,058 56,518 7,540 8,470,086
40 8,470,086 64,058 56,467 7,590 8,462,496
41 8,462,496 64,058 56,417 7,641 8,454,855
42 8,454,855 64,058 56,366 7,692 8,447,163
43 8,447,163 64,058 56,314 7,743 8,439,419
44 8,439,419 64,058 56,263 7,795 8,431,625
19
BEGINNING DEBT ENDING
--------------------------------------------------------- --------------------------------------------
MO BALANCE SERVICE INT AMORT BALANCE
45 8,431,625 64,058 56,211 7,847 8,423,778
46 8,423,778 64,058 56,159 7,899 8,415,879
47 8,415,879 64,058 56,106 7,952 8,407,927
48 8,407,927 64,058 56,053 8,005 8,399,922
49 8,399,922 64,058 55,999 8,058 8,391,864
50 8,391,864 64,058 55,946 8,112 8,383,752
51 8,383,752 64,058 55,892 8,166 8,375,586
52 8,375,586 64,058 55,837 8,220 8,367,366
53 8,367,366 64,058 55,782 8,275 8,359,090
54 8,359,090 64,058 55,727 8,330 8,350,760
55 8,350,760 64,058 55,672 8,386 8,342,374
56 8,342,374 64,058 55,616 8,442 8,333,392
57 8,333,392 64,058 55,560 8,498 8,325,434
58 8,325,434 64,058 55,503 8,555 8,316,879
59 8,316,879 64,058 55,446 8,612 8,308,268
60 8,308,268 64,058 55,388 8,669 8,299,598