PROMISSORY NOTE
$7,392,000.00 Atlanta, Georgia
June 27, 1996
FOR VALUE RECEIVED, THICKET APARTMENTS, L.P., a Delaware limited
partnership, as maker, having its principal place of business at 3111 Paces Mill
Road, Suite A- 200, Atlanta, Georgia 30339 (hereinafter referred to as
"Borrower"), promises to pay to the order of UNIVEST MORTGAGE CAPITAL, LLC, a
Georgia limited liability company, as payee, having its principal place of
business at Six Concourse Parkway, Suite 1400, Atlanta, Georgia 30328-5346
(hereinafter referred to as "Lender"), at such place as the holder hereof may
from time to time designate in writing, the principal sum of Seven Million Three
Hundred Ninety-Two Thousand and No/100 Dollars ($7,392,000.00 ), in lawful money
of the United States of America, with interest thereon to be computed from the
date of this Note at the Applicable Interest Rate (hereinafter defined), and to
be paid in installments as follows:
1. A payment of interest only on June 27, 1996, on account of interest for
the month of June, 1996;
2. A constant payment of $59,690.58 on the first day of August , 1996 and
on the first day of each calendar month thereafter up to and including the first
day of June, 2003; each of the payments to be applied as follows:
(a) first, to the payment of interest computed at the Applicable
Interest Rate; and
(b) the balance toward the reduction of the principal sum;
and the balance of said principal sum together with all interest thereon shall
be due and payable on the first day of July, 2003 (the "Maturity Date").
Interest on the principal sum of this Note shall be calculated on the basis of a
three hundred sixty (360) day year composed of twelve (12) months of thirty (30)
days each except that interest due and payable for a period less than a full
month shall be calculated by multiplying the actual number of days elapsed in
such period by a daily rate based on said 360 day year. All amounts due under
this Note shall be payable without set off, counterclaim or any other deduction
whatsoever.
The term "Applicable Interest Rate" as used in this Note shall mean from
the date of this Note through and including the Maturity Date, a rate of 9.04%
per annum.
The whole of the principal sum of this Note, together with all interest
accrued and unpaid thereon and all other sums due under the Security Instrument
(hereinafter defined) and this Note (all such sums hereinafter collectively
referred to as the "Debt"), or any portion thereof, shall without notice become
immediately due and payable at the option of Lender if any payment required in
this Note is not paid within ten (10) days of the date when due or on the
happening of any other default, after the expiration of any applicable notice
and grace periods, herein or under the terms of the Security Instrument or the
Other Security Documents, as hereinafter defined (hereinafter each an "Event of
Default"). Time is of the essence in this Note, the Security Instrument and the
Other Security Documents. All of the terms, covenants and conditions contained
in the Security Instrument and the Other Security Documents (hereinafter
defined) are hereby made part of this Note to the same extent and with the same
force as if they were fully set forth herein. In the event that it should become
necessary to employ counsel to collect the Debt or to protect or foreclose the
security hereof, Borrower also agrees to pay on demand all costs of collection
incurred by Lender, including reasonable attorneys' fees actually incurred for
the services of counsel whether or not suit be brought.
If following the occurrence of any Event of Default, Borrower shall tender
payment of an amount sufficient to satisfy the Debt at any time prior to a sale
of the Property (as defined in the Security Instrument) either through
foreclosure or the exercise of other remedies available to Lender under the
Security Instrument, such tender by Borrower shall be deemed to be a voluntary
prepayment under this Note in the amount tendered. If at the time of such tender
prepayment of the principal balance of this Note is not permitted, Borrower
shall, in addition to the entire Debt, also pay to Lender a sum equal to
interest which would have accrued on the principal balance of this Note at the
Applicable Interest Rate from the date of such tender to the earlier of (i) the
Maturity Date, or (ii) the first day of the period during which prepayment of
the principal balance of this Note would have been permitted, together with a
prepayment consideration equal to the prepayment consideration which would have
been payable as of the first day of the period during which prepayment would
have been permitted. If at the time of such tender prepayment of the principal
balance of this Note is permitted, Borrower shall, in addition to the entire
Debt, also pay to Lender the applicable prepayment consideration specified in
this Note.
The principal balance of this Note may not be prepaid in whole or in part
(except with respect to the application of insurance proceeds or condemnation
awards pursuant to the Security Instrument) prior to the commencement of the
fourth Loan Year (as hereinafter defined). During the fourth Loan Year or at
anytime thereafter, provided no Event of Default exists, the principal balance
of this Note may be prepaid, in whole but not in part (except with respect to
the application of insurance proceeds or condemnation awards pursuant to the
Security Instrument), on any scheduled payment date under this Note upon not
less than ninety (90) days prior written notice to Lender specifying the
scheduled payment date on which prepayment is to be made (the "Prepayment Date")
and upon payment of (a) interest accrued and unpaid on the principal balance of
this Note to and including the Prepayment Date, (b) all other sums then due
under this Note, and the Other Security Documents, and (c) a prepayment
consideration in an amount equal to the greater of (i) one percent (1%) of the
outstanding principal balance of this Note at the time of prepayment, or (ii)
the present value as of the Prepayment Date of the remaining scheduled payments
of principal and interest from the Prepayment Date through the Maturity Date
(including any balloon payment) determined by discounting such payments at the
Discount Rate (as hereinafter defined) less the amount of principal being
prepaid. The term "Discount Rate" means the rate which, when compounded monthly,
is equivalent to the Treasury Rate (as hereinafter defined), when compounded
semi-annually. The term "Treasury Rate" means the yield calculated by the linear
interpolation of the yields, as reported in Federal Reserve Statistical Release
H.15-Selected Interest Rates under the heading "U.S. Government
Securities/Treasury Constant Maturities" for the week ending prior to the
Prepayment Date, of U.S. Treasury constant maturities with maturity dates (one
longer and one shorter) most nearly approximating the Maturity Date. (In the
event Release H.15 is no longer published, Lender shall select a comparable
publication to determine the Treasury Rate.) Lender shall notify Borrower of the
amount and the basis of determination of the required prepayment consideration.
Notwithstanding the foregoing, there shall be no prepayment consideration due in
connection with (1) the prepayment of the principal balance of this Note if
prepayment occurs within six (6) months preceding the Maturity Date or (2) a
complete or partial prepayment resulting from the application of insurance
proceeds or condemnation awards pursuant to the Security Instrument. If any such
notice of prepayment is given, the principal balance of this Note and the other
sums required under this paragraph shall be due and payable on the Prepayment
Date. Lender shall not be obligated to accept any prepayment of the principal
balance of this Note unless it is accompanied by the prepayment consideration
due in connection therewith. The term "Loan Year" for purposes of this paragraph
means each complete 365 day period (366 days in a leap year) after the first day
of the first calendar month after the date of this Note.
Borrower does hereby agree that upon the occurrence of an Event of Default
which is not cured within any applicable grace or notice period, or upon the
failure of Borrower to pay the Debt in full on the Maturity Date, Lender shall
be entitled to receive and Borrower shall pay interest on the entire unpaid
principal sum at the rate of five percent (5%) above the Applicable Interest
Rate (the "Default Rate"); provided, however, that in the event Lender permits
Borrower to cure such Event of Default, then the rate of interest on the unpaid
principal balance of this Note shall be the Applicable Interest Rate and shall
be computed from the date such Event of Default is cured. The Default Rate shall
be computed from the occurrence of the Event of Default until the actual receipt
and collection of the Debt or, if permitted by Lender, the date such Event of
Default is cured. This charge shall be added to the Debt, and shall be deemed
secured by the Security Instrument. This clause, however, shall not be construed
as an agreement or privilege to extend the date of the payment of the Debt, nor
as a waiver of any other right or remedy accruing to Lender by reason of the
occurrence of any Event of Default. In the event the Default Rate would
otherwise exceed the maximum rate permitted by applicable law, the Default Rate
shall be the maximum rate permitted by applicable law.
This Note is secured by the Security Instrument and the Other Security
Documents. The term "Security Instrument" as used in this Note shall mean that
certain Deed to Secure Debt and Security Agreement dated the date hereof in the
principal sum of $7,392,000.00 given by Borrower to Lender covering the fee
estate of Borrower in certain premises located in DeKalb County, State of
Georgia, and other property, as more particularly described therein and intended
to be duly recorded in said County. The term "Other Security Documents" as used
in this Note shall mean all and any of the documents other than this Note or the
Security Instrument now or hereafter executed by Borrower and/or others and by
or in favor of Lender, which wholly or partially secure or guarantee payment of
this Note. Whenever used, the singular number shall include the plural, the
plural the singular, and the words "Lender" and "Borrower" shall include their
respective successors, assigns, heirs, executors and administrators.
This Note is subject to the express condition that at no time shall
Borrower be obligated or required to pay interest on the Debt or any portion
thereof at a rate which could subject Lender to either civil or criminal
liability as a result of being in excess of the maximum interest rate which
Borrower is permitted by applicable law to contract or agree to pay. If by the
terms of this Note, Borrower is at any time required or obligated to pay
interest on the Debt or any portion thereof at a rate in excess of such maximum
rate, the rate of interest under this Note shall be deemed to be immediately
reduced to such maximum rate and the interest payable shall be computed at such
maximum rate and all prior interest payments in excess of the maximum rate shall
be deemed to have been payments in reduction of principal and not on account of
the interest due hereunder.
If any sum payable under this Note is not paid within ten (10) days after
the date on which it is due, Borrower shall pay to Lender upon demand an amount
equal to the lesser of five percent (5%) of such unpaid sum or the maximum
amount permitted by applicable law to defray the expenses incurred by Lender in
handling and processing such delinquent payment and to compensate Lender for the
loss of the use of such delinquent payment and such amount shall be secured by
the Security Instrument and the Other Security Documents.
This Note may not be modified, amended, waived, extended, changed,
discharged or terminated orally or by any act or failure to act on the part of
Borrower or Lender, but only by an agreement in writing signed by the party
against whom enforcement of any modification, amendment, waiver, extension,
change, discharge or termination is sought.
If Borrower consists of more than one person or party, the obligations and
liabilities of each such person or party shall be joint and several.
Borrower and all others who may become liable for the payment of all or any
part of the Debt do hereby severally waive presentment and demand for payment,
notice of dishonor, protest and notice of protest, notice of non-payment and
notice of intent to accelerate the maturity hereof (and of such acceleration).
No release of any security for the Debt or extension of time for payment of this
Note or any installment hereof, and no alteration, amendment or waiver of any
provision of this Note, the Security Instrument and the Other Security Documents
made by agreement between Lender and any other person or party shall release,
modify, amend, waive, extend, change, discharge, terminate or affect the
liability of Borrower, and any other who may become liable for the payment of
all or any part of the Debt, under this Note, the Security Instrument and the
Other Security Documents.
Borrower (and the undersigned representative of Borrower, if any)
represents that Borrower has full power, authority and legal right to execute,
deliver and perform its obligations pursuant to this Note, the Security
Instrument and the Other Security Documents and that this Note, the Security
Instrument and the Other Security Documents constitute valid and binding
obligations of Borrower.
Upon the transfer of this Note, Borrower hereby waiving notice of any such
transfer, Lender may deliver all the collateral mortgaged, granted, pledged or
assigned pursuant to the Security Instrument and the Other Security Documents,
or any part thereof, to the transferee who shall thereupon become vested with
all the rights herein or under applicable law given to Lender with respect
thereto, and Lender shall thereafter forever be relieved and fully discharged
from any liability or responsibility in the matter; but Lender shall retain all
rights hereby given to it with respect to any liabilities and the collateral not
so transferred.
BORROWER HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE RIGHT
TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM, WHETHER IN CONTRACT,
TORT OR OTHERWISE, RELATING DIRECTLY OR INDIRECTLY TO THE LOAN EVIDENCED BY THIS
NOTE, THE APPLICATION FOR THE LOAN EVIDENCED BY THIS NOTE, THIS NOTE, THE
SECURITY INSTRUMENT OR THE OTHER SECURITY DOCUMENTS OR ANY ACTS OR OMISSIONS OF
LENDER, ITS OFFICERS, EMPLOYEES, DIRECTORS OR AGENTS IN CONNECTION THEREWITH.
The personal liability of Borrower to pay the Debt shall be limited to (a)
the Property and (b) the Rents (as defined in the Security Instrument),
including any received or collected by or on behalf of Borrower after and during
the continuance of an Event of Default, except to the extent that Borrower did
not have the legal right, because of a bankruptcy, receivership or similar
judicial proceeding, to direct the disbursement of such sums.
Except as provided herein, Lender hereof shall not seek (a) any judgment
for a deficiency against Borrower in any action to enforce any right or remedy
under the Security Instrument, or (b) any judgment on this Note except as may be
necessary in any action brought under the Security Instrument to enforce the
lien against the Property.
Notwithstanding the foregoing, Borrower shall be personally liable to
Lender in the amount of any loss, damage or cost incurred by Lender resulting
from (i) fraud or intentional misrepresentation by Borrower or any other person
or entity employed by or an agent of Borrower in connection with obtaining the
loan evidenced by this Note, (ii) insurance proceeds, condemnation awards, or
other sums or payments attributable to the Property not applied in accordance
with the provisions of the Security Instrument, except to the extent that
Borrower did not have the legal right, because of a bankruptcy, receivership, or
similar judicial proceeding, to direct disbursement of such sums or payments,
(iii) all Rents received following and during the continuance of any Event of
Default under this Note or the Security Instrument and not applied to payment of
principal and interest due under this Note (including any such Rents received or
collected by or on behalf of Borrower after an Event of Default, except to the
extent that Borrower did not have the legal right, because of a bankruptcy,
receivership or similar judicial proceeding, to direct the disbursement of such
Rents), and payments of utilities, taxes and assessments and insurance on the
Property, as they become due or payable, or (iv) Borrower's failure to pay
transfer fees and charges due Lender hereof under this Note or the Security
Instrument in connection with any transfer of all or any part of the Property,
or any interest therein, to the extent permitted herein by Lender from Borrower
to Borrower's transferee, or transfer of beneficial interest in Borrower (if
Borrower is not a natural person or persons but is a corporation, partnership,
trust or other legal entity), (v) a default by Borrower under paragraphs 32 or
33(g) through (j) of the Security Instrument, (vi) failure to pay any recording
taxes or documentary stamps or other charges required in connection with the
Security Instrument, (vii) failure to pay real estate taxes for the Property,
(viii) failure to pay insurance premiums for the Property, (ix) misapplication
or misappropriation of Rents or security deposits collected in advance, (x) the
inability of Lender to enforce the Assignment of Leases and Rents executed by
Borrower in favor of Lender with regard to the Property, and (xi) failure of
Borrower to comply with all provisions of this Note, the Security Instrument or
Other Security Documents regarding delivery of financial or operating
statements, including, without limitation, paragraph 15 of the Security
Instrument. Notwithstanding the foregoing, the agreement of Lender not to pursue
recourse liability as set forth above shall become NULL and VOID and shall be of
no further force and effect in the event Borrower shall be in default of the
provisions of Paragraphs 50 or 9 of the Security Instrument.
No provision contained herein shall (a) affect any guaranty, indemnity or
similar agreement executed in connection with the indebtedness evidenced by this
Note, (b) release or reduce the Debt, or (c) impair the lien of the Security
Instrument.
All notices or other written communications hereunder shall be deemed to
have been properly given (i) upon delivery, if delivered in person or by
facsimile transmission with receipt acknowledged by the recipient thereof, (ii)
one (1) Business Day (defined below) after having been deposited for overnight
delivery with any reputable overnight courier service, or (iii) three (3)
Business Days after having been deposited in any post office or mail depository
regularly maintained by the U.S. Postal Service and sent by registered or
certified mail, postage prepaid, return receipt requested, addressed as follows:
If to Borrower:
---------------
Thicket Apartments, L.P.
3111 Paces Mill Road, Suite A-200
Atlanta, Georgia 30339
Attention: General Partner
If to Lender:
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Univest Mortgage Capital, LLC
Six Concourse Parkway, Suite 1400
Atlanta, Georgia 30328-5346
Attention: Daniel B. Lambert
Facsimile No.: (770) 399-8396
or addressed as such party may from time to time designate by written notice to
the other parties.
Either party by notice to the other may designate additional or different
addresses for subsequent notices or communications.
For purposes of this Subsection, "Business Day" shall mean a day on which
commercial banks are not authorized or required by law to close in New York, New
York.
This Note shall be governed and construed in accordance with the laws of
the State of Georgia and the applicable laws of the United States of America.
ln the event that it should become necessary to employ counsel to collect
the Debt or to protect or foreclose the security therefor, Borrower also agrees
to pay all reasonable fees and expenses of Lender, including, without
limitation, reasonable attorney's fees actually incurred for the services of
such counsel whether or not suit be brought.
IN WITNESS WHEREOF, Borrower has duly executed this Note the day and year
first above written. BORROWER:
Signed, sealed and delivered THICKET APARTMENTS, L.P., a Delaware limited
in the presence of: partnership
________________________ By: THICKET HOLDINGS, INC., a Delaware
Unofficial Witness corporation, General Partner
________________________ BY: /s/ Peter D. Anzo
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Notary Public PETER D. ANZO,
Chief Executive Officer
[NOTARIAL SEAL]
[CORPORATE SEAL]
Commission Expiration Date:
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