FHLMC Loan No. 679503102
MULTIFAMILY NOTE
(MULTISTATE)
(Blue Ridge at Palomino Park)
US $34,500,000.00 as of December 24, 1997
FOR VALUE RECEIVED, the undersigned ("Borrower") jointly and
severally (if more than one) promises to pay to the order of GMAC
COMMERCIAL MORTGAGE CORPORATION, a California corporation the principal sum
of THIRTY-FOUR MILLION FIVE HUNDRED THOUSAND and 00/100 Dollars (US
$34,500,000.00) with interest on the unpaid principal balance at the annual
rate of six and 92/100 percent (6.92%).
1. Defined Terms. As used in this Note, (i) the term "Lender"
means the holder of this Note, and (ii) the term "Indebtedness" means the
principal of, interest on, or any other amounts due at any time under, this
Note, the Security Instrument or any other Loan Document, including
prepayment premiums, late charges, default interest, and advances to
protect the security of the Security Instrument under Section 12 of the
Security Instrument. "Event of Default" and other capitalized terms used
but not defined in this Note shall have the meanings given to such terms in
the Security Instrument.
2. Address for Payment. All payments due under this Note shall
be payable at 650 Dresher Road, Horsham, Pennsylvania 19044, or such other
place as may be designated by written notice to Borrower from or on behalf
of Lender.
3. Payment of Principal and Interest. Principal and interest
shall be paid as follows:
(1) Unless disbursement of principal is made by Lender to
Borrower on the first day of the month, interest for the period beginning
on the date of disbursement and ending on and including the last day of the
month in which such disbursement is made shall be payable simultaneously
with the execution of this Note. Interest under this Note shall be
computed on the basis of a 360-day year consisting of twelve 30-day months.
(2) Consecutive monthly installments of principal and interest,
each in the amount of TWO HUNDRED TWENTY-SEVEN THOUSAND SIX HUNDRED
SEVENTY-EIGHT and 76/100 Dollars (US $227,678.76), shall be payable on the
first day of each month beginning on February 1, 1998 until the entire
unpaid principal balance evidenced by this Note is fully paid. Any accrued
interest remaining past due for 30 days or more shall be added to and
become part of the unpaid principal balance and shall bear interest at the
rate or rates specified in this Note, and any reference below to "accrued
interest" shall refer to accrued interest which has not become part of the
unpaid principal balance. Any remaining principal and interest shall be
due and payable on January 1, 2008 or on any earlier date on which the
unpaid principal balance of this Note becomes due and payable, by
acceleration or otherwise (the "Maturity Date"). The unpaid principal
balance shall continue to bear interest after the Maturity Date at the
Default Rate set forth in this Note until and including the date on which
it is paid in full.
(3) Any regularly scheduled monthly installment of principal and
interest that is received by Lender before the date it is due shall be
deemed to have been received on the due date solely for the purpose of
calculating interest due.
4. Application of Payments. If at any time Lender receives,
from Borrower or otherwise, any amount applicable to the Indebtedness which
is less than all amounts due and payable at such time, Lender may apply
that payment to amounts then due and payable in any manner and in any order
determined by Lender, in Lender's discretion. Borrower agrees that neither
Lender's acceptance of a payment from Borrower in an amount that is less
than all amounts then due and payable nor Lender's application of such
payment shall constitute or be deemed to constitute either a waiver of the
unpaid amounts or an accord and satisfaction.
5. Security. The Indebtedness is secured, among other things,
by a multifamily mortgage, deed to secure debt or deed of trust dated as of
the date of this Note (the "Security Instrument"), and reference is made to
the Security Instrument for other rights of Lender as to collateral for the
Indebtedness.
6. Acceleration. If an Event of Default has occurred and is
continuing, the entire unpaid principal balance, any accrued interest, the
prepayment premium payable under Paragraph 10, if any, and all other
amounts payable under this Note and any other Loan Document shall at once
become due and payable, at the option of Lender, without any prior notice
to Borrower. Lender may exercise this option to accelerate regardless of
any prior forbearance.
7. Late Charge. If any monthly amount payable under this Note
or under the Security Instrument or any other Loan Document is not received
by Lender within ten (10) days after the amount is due, Borrower shall pay
to Lender, immediately and without demand by Lender, a late charge equal to
five (5%) percent of such amount. Borrower acknowledges that its failure
to make timely payments will cause Lender to incur additional expenses in
servicing and processing the loan evidenced by this Note (the "Loan"), and
that it is extremely difficult and impractical to determine those
additional expenses. Borrower agrees that the late charge payable pursuant
to this Paragraph represents a fair and reasonable estimate, taking into
account all circumstances existing on the date of this Note, of the
additional expenses Lender will incur by reason of such late payment. The
late charge is payable in addition to, and not in lieu of, any interest
payable at the Default Rate pursuant to Paragraph 8.
8. Default Rate. So long as (a) any monthly installment under
this Note remains past due for 30 days or more, or (b) any other Event of
Default has occurred and is continuing, interest under this Note shall
accrue on the unpaid principal balance from the earlier of the due date of
the first unpaid monthly installment or the occurrence of such other Event
of Default, as applicable, at a rate (the "Default Rate") equal to the
lesser of 4 percentage points above the rate stated in the first paragraph
of this Note or the maximum interest rate which may be collected from
Borrower under applicable law. If the unpaid principal balance and all
accrued interest are not paid in full on the Maturity Date, the unpaid
principal balance and all accrued interest shall bear interest from the
Maturity Date at the Default Rate. Borrower also acknowledges that its
failure to make timely payments will cause Lender to incur additional
expenses in servicing and processing the Loan, that, during the time that
any monthly installment under this Note is delinquent for more than 30
days, Lender will incur additional costs and expenses arising from its loss
of the use of the money due and from the adverse impact on Lender's ability
to meet its other obligations and to take advantage of other investment
opportunities, and that it is extremely difficult and impractical to
determine those additional costs and expenses. Borrower also acknowledges
that, during the time that any monthly installment under this Note is
delinquent for more than 30 days or any other Event of Default has occurred
and is continuing, Lender's risk of nonpayment of this Note will be
materially increased and Lender is entitled to be compensated for such
increased risk. Borrower agrees that the increase in the rate of interest
payable under this Note to the Default Rate represents a fair and
reasonable estimate, taking into account all circumstances existing on the
date of this Note, of the additional costs and expenses Lender will incur
by reason of the Borrower's delinquent payment and the additional
compensation Lender is entitled to receive for the increased risks of
nonpayment associated with a delinquent loan.
9. Limits on Personal Liability.
(1) Except as otherwise provided in this Paragraph 9, Borrower
shall have no personal liability under this Note, the Security Instrument
or any other Loan Document for the repayment of the Indebtedness or for
the performance of any other obligations of Borrower under the Loan
Documents, and Lender's only recourse for the satisfaction of the
Indebtedness and the performance of such obligations shall be Lender's
exercise of its rights and remedies with respect to the Mortgaged Property
and any other collateral held by Lender as security for the Indebtedness.
This limitation on Borrower's liability shall not limit or impair Lender's
enforcement of its rights against any guarantor of the Indebtedness or any
guarantor of any obligations of Borrower.
(2) Borrower shall be personally liable to Lender for the
repayment of a portion of the Indebtedness equal to zero percent (0%)
of the original principal balance of this Note, plus any other amounts for
which Borrower has personal liability under this Paragraph 9.
(3) In addition to Borrower's personal liability under Paragraph
9(b), Borrower shall be personally liable to Lender for the repayment of a
further portion of the Indebtedness equal to any loss or damage suffered by
Lender as a result of (1) failure of Borrower to pay to Lender upon demand
after an Event of Default all Rents to which Lender is entitled under
Section 3 (a) of the Security Instrument and the amount of all security
deposits collected by Borrower from tenants then in residence; (2) failure
of Borrower to apply all insurance proceeds and condemnation proceeds as
required by the Security Instrument; or (3) failure of Borrower to comply
with Section 14(d) or (e) of the Security Instrument relating to the
delivery of books and records, statements, schedules and reports.
(4) For purposes of determining Borrower's personal liability
under Paragraph 9(b) and Paragraph 9(c), all payments made by Borrower or
any guarantor of this Note with respect to the Indebtedness and all amounts
received by Lender from the enforcement of its rights under the Security
Instrument shall be applied first to the portion of the Indebtedness for
which Borrower has no personal liability.
(5) Borrower shall become personally liable to Lender for the
repayment of all of the Indebtedness upon the occurrence of any of the
following Events of Default: (1) Borrower's acquisition of any property or
operation of any business not permitted by Section 33 of the Security
Instrument; (2) a Transfer (including, but not limited to, a lien or
encumbrance) that is an Event of Default under Section 21 of the Security
Instrument, other than a Transfer consisting solely of the involuntary
removal or involuntary withdrawal of a general partner in a limited
partnership or a manager in a limited liability company; or (3) fraud or
written material misrepresentation by Borrower or any officer, director,
partner, member or employee of Borrower in connection with the application
for or creation of the Indebtedness or any request for any action or
consent by Lender.
(6) In addition to any personal liability for the Indebtedness,
Borrower shall be personally liable to Lender for (1) the performance of
all of Borrower's obligations under Section 18 of the Security Instrument
(relating to environmental matters); (2) the costs of any audit under
Section 14(d) of the Security Instrument; and (3) any costs and expenses
incurred by Lender in connection with the collection of any amount for
which Borrower is personally liable under this Paragraph 9, including fees
and out of pocket expenses of attorneys and expert witnesses and the costs
of conducting any independent audit of Borrower's books and records to
determine the amount for which Borrower has personal liability.
(7) To the extent that Borrower has personal liability under
this Paragraph 9, Lender may exercise its rights against Borrower
personally without regard to whether Lender has exercised any rights
against the Mortgaged Property or any other security, or pursued any rights
against any guarantor, or pursued any other rights available to Lender
under this Note, the Security Instrument, any other Loan Document or
applicable law. For purposes of this Paragraph 9, the term "Mortgaged
Property" shall not include any funds that (1) have been applied by
Borrower as required or permitted by the Security Instrument prior to the
occurrence of an Event of Default or (2) Borrower was unable to apply as
required or permitted by the Security Instrument because of a bankruptcy,
receivership, or similar judicial proceeding.
10. Voluntary and Involuntary Prepayments.
(1) A prepayment premium shall be payable in connection with any
prepayment made under this Note as provided below:
(1) Borrower may voluntarily prepay all of the unpaid
principal balance of this Note on the last Business Day of a calendar month
if Borrower has given Lender at least 30 days prior notice of its intention
to make such prepayment. Such prepayment shall be made by paying (A) the
amount of principal being prepaid, (B) all accrued interest, (C) all other
sums due Lender at the time of such prepayment, and (D) the prepayment
premium calculated pursuant to Schedule A. For all purposes including the
accrual of interest, any prepayment received by Lender on any day other
than the last calendar day of the month shall be deemed to have been
received on the last calendar day of such month. For purposes of this
Note, a "Business Day" means any day other than a Saturday, Sunday or any
other day on which Lender is not open for business. Borrower shall not
have the option to voluntarily prepay less than all of the unpaid principal
balance.
(2) Upon Lender's exercise of any right of acceleration
under this Note, Borrower shall pay to Lender, in addition to the entire
unpaid principal balance of this Note outstanding at the time of the
acceleration, (A) all accrued interest and all other sums due Lender, and
(B) the prepayment premium calculated pursuant to Schedule A.
(3) Any application by Lender of any collateral or other
security to the repayment of any portion of the unpaid principal balance of
this Note prior to the Maturity Date and in the absence of acceleration
shall be deemed to be a partial prepayment by Borrower, requiring the
payment to Lender by Borrower of a prepayment premium. The amount of any
such partial prepayment shall be computed so as to provide to Lender a
prepayment premium computed pursuant to Schedule A without Borrower having
to pay out-of-pocket any additional amounts.
(2) Notwithstanding the provisions of Paragraph 10(a), no
prepayment premium shall be payable with respect to (A) any prepayment made
no more than 180 days before the Maturity Date, or (B) any prepayment
occurring as a result of the application of any insurance proceeds or
condemnation award under the Security Instrument.
(3) Schedule A is hereby incorporated by reference into this
Note.
(4) Any permitted or required prepayment of less than the unpaid
principal balance of this Note shall not extend or postpone the due date of
any subsequent monthly installments or change the amount of such
installments, unless Lender agrees otherwise in writing.
(5) Borrower recognizes that any prepayment of the unpaid
principal balance of this Note, whether voluntary or involuntary or
resulting from a default by Borrower, will result in Lender's incurring
loss, including reinvestment loss, additional expense and frustration or
impairment of Lender's ability to meet its commitments to third parties.
Borrower agrees to pay to Lender upon demand damages for the detriment
caused by any prepayment, and agrees that it is extremely difficult and
impractical to ascertain the extent of such damages. Borrower therefore
acknowledges and agrees that the formula for calculating prepayment
premiums set forth on Schedule A represents a reasonable estimate of the
damages Lender will incur because of a prepayment.
(6) Borrower further acknowledges that the prepayment premium
provisions of this Note are a material part of the consideration for the
Loan, and acknowledges that the terms of this Note are in other respects
more favorable to Borrower as a result of the Borrower's voluntary
agreement to the prepayment premium provisions.
11. Costs and Expenses. Borrower shall pay all expenses and
costs, including fees and out-of-pocket expenses of attorneys and expert
witnesses and costs of investigation, incurred by Lender as a result of any
default under this Note or in connection with efforts to collect any amount
due under this Note, or to enforce the provisions of any of the other Loan
Documents, including those incurred in post-judgment collection efforts and
in any bankruptcy proceeding (including any action for relief from the
automatic stay of any bankruptcy proceeding) or judicial or non-judicial
foreclosure proceeding.
12. Forbearance. Any forbearance by Lender in exercising any
right or remedy under this Note, the Security Instrument, or any other Loan
Document or otherwise afforded by applicable law, shall not be a waiver of
or preclude the exercise of that or any other right or remedy. The
acceptance by Lender of any payment after the due date of such payment, or
in an amount which is less than the required payment, shall not be a waiver
of Lender's right to require prompt payment when due of all other payments
or to exercise any right or remedy with respect to any failure to make
prompt payment. Enforcement by Lender of any security for Borrower's
obligations under this Note shall not constitute an election by Lender of
remedies so as to preclude the exercise of any other right or remedy
available to Lender.
13. Waivers. Presentment, demand, notice of dishonor, protest,
notice of acceleration, notice of intent to demand or accelerate payment or
maturity, presentment for payment, notice of nonpayment, grace, and
diligence in collecting the Indebtedness are waived by Borrower and all
endorsers and guarantors of this Note and all other third party obligors.
14. Loan Charges. If any applicable law limiting the amount of
interest or other charges permitted to be collected from Borrower in
connection with the Loan is interpreted so that any interest or other
charge provided for in any Loan Document, whether considered separately or
together with other charges provided for in any other Loan Document,
violates that law, and Borrower is entitled to the benefit of that law,
that interest or charge is hereby reduced to the extent necessary to
eliminate that violation. The amounts, if any, previously paid to Lender
in excess of the permitted amounts shall be applied by Lender to reduce the
unpaid principal balance of this Note. For the purpose of determining
whether any applicable law limiting the amount of interest or other charges
permitted to be collected from Borrower has been violated, all Indebtedness
that constitutes interest, as well as all other charges made in connection
with the Indebtedness that constitute interest, shall be deemed to be
allocated and spread ratably over the stated term of the Note. Unless
otherwise required by applicable law, such allocation and spreading shall
be effected in such a manner that the rate of interest so computed is
uniform throughout the stated term of the Note.
15. Commercial Purpose. Borrower represents that the
Indebtedness is being incurred by Borrower solely for the purpose of
carrying on a business or commercial enterprise, and not for personal,
family or household purposes.
16. Counting of Days. Except where otherwise specifically
provided, any reference in this Note to a period of "days" means calendar
days, not Business Days.
17. Governing Law. This Note shall be governed by the law of the
jurisdiction in which the Land is located.
18. Captions. The captions of the paragraphs of this Note are
for convenience only and shall be disregarded in construing this Note.
19. Notices. All notices, demands and other communications
required or permitted to be given by Lender to Borrower pursuant to this
Note shall be given in accordance with Section 31 of the Security
Instrument.
20. Consent to Jurisdiction and Venue. Borrower agrees that any
controversy arising under or in relation to this Note shall be litigated
exclusively in the jurisdiction in which the Land is located (the "Property
Jurisdiction"). The state and federal courts and authorities with
jurisdiction in the Property Jurisdiction shall have exclusive jurisdiction
over all controversies which shall arise under or in relation to this Note.
Borrower irrevocably consents to service, jurisdiction, and venue of such
courts for any such litigation and waives any other venue to which it might
be entitled by virtue of domicile, habitual residence or otherwise.
21. WAIVER OF TRIAL BY JURY. BORROWER AND LENDER EACH (A)
AGREES NOT TO ELECT A TRIAL BY JURY WITH RESPECT TO ANY ISSUE ARISING OUT
OF THIS NOTE OR THE RELATIONSHIP BETWEEN THE PARTIES AS LENDER AND BORROWER
THAT IS TRIABLE OF RIGHT BY A JURY AND (B) WAIVES ANY RIGHT TO TRIAL BY
JURY WITH RESPECT TO SUCH ISSUE TO THE EXTENT THAT ANY SUCH RIGHT EXISTS
NOW OR IN THE FUTURE. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS SEPARATELY
GIVEN BY EACH PARTY, KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF
COMPETENT LEGAL COUNSEL.
ATTACHED SCHEDULES. The following Schedules are attached to this Note:
|X| Schedule A Prepayment Premium (required)
| | Schedule B Modifications to Multifamily Note
IN WITNESS WHEREOF, Borrower has signed and delivered this Note or has
caused this Note to be signed and delivered by its duly authorized
representative.
PARK AT HIGHLANDS LLC, a Colorado limited liability
company
By:/s/ Al Feld
________________________________(SEAL)
Al Feld
Managing Member
84-1305862
Borrower's Social Security/Employer ID Number
PAY TO THE ORDER OF FEDERAL
HOME LOAN MORTGAGE
CORPORATION WITHOUT RECOURSE
AS OF THE 24TH DAY OF DECEMBER, 1997.
GMAC COMMERCIAL MORTGAGE
CORPORATION
By:/s/ J. Kevin McCormack
_______________________________
J. Kevin McCormack
Vice President
SCHEDULE A
PREPAYMENT PREMIUM
Any prepayment premium payable under Paragraph 10 of this Note shall be
computed as follows:
(a) If the prepayment is made between the date of this Note and the
date that is 114 months after the first day of the first calendar month
following the date of this Note (the "Yield Maintenance Period"), the
prepayment premium shall be the greater of
(i) 1.0% of the unpaid principal balance of this Note; or
(ii) the product obtained by multiplying:
(A) the amount of principal being prepaid,
by
(B) the excess (if any) of the Monthly Note Rate over the
Assumed Reinvestment Rate,
by
(C) the Present Value Factor.
For purposes of subparagraph (ii), the following definitions
shall apply:
Monthly Note Rate: one-twelfth (1/12) of the annual interest
rate of the Note, expressed as a decimal calculated to five
digits.
Prepayment Date: in the case of a voluntary prepayment, the
date on which the prepayment is made; in any other case, the
date on which Lender accelerates the unpaid principal
balance of the Note.
Assumed Reinvestment Rate: one-twelfth (1/12) of the yield
rate as of the date 5 Business Days before the Prepayment
Date, on the 6.125% U.S. Treasury Security due 8/1/2007, as
reported in The Wall Street Journal, expressed as a decimal
calculated to five digits. In the event that no yield is
published on the applicable date for the Treasury Security
used to determine the Assumed Reinvestment Rate, Lender, in
its discretion, shall select the non-callable Treasury
Security maturing in the same year as the Treasury Security
specified above with the lowest yield published in The Wall
Street Journal as of the applicable date. If the
publication of such yield rates in The Wall Street Journal
is discontinued for any reason, Lender shall select a
security with a comparable rate and term to the Treasury
Security used to determine the Assumed Reinvestment Rate.
The selection of an alternate security pursuant to this
Paragraph shall be made in Lender's discretion.
Present Value Factor: the factor that discounts to present
value the costs resulting to Lender from the difference in
interest rates during the months remaining in the Yield
Maintenance Period, using the Assumed Reinvestment Rate as
the discount rate, with monthly compounding, expressed
numerically as follows:
n = number of months remaining in Yield Maintenance Period
ARR = Assumed Reinvestment Rate
(b) If the prepayment is made after the expiration of the Yield
Maintenance Period but more than one hundred eighty (180) days before the
Maturity Date, the prepayment premium shall be 1.0% of the unpaid principal
balance of this Note.
SCHEDULE B
MODIFICATIONS TO MULTIFAMILY NOTE