AMENDED AND RESTATED AGREEMENT
THIS AMENDED AND RESTATED AGREEMENT ("Agreement") made as of this 31st day
of January, 1995, by and between RICHLAND PROPERTIES, INC., a Delaware
corporation (the "Mortgagor") and NYLIFE GOVERNMENT MORTGAGE PLUS LIMITED
PARTNERSHIP, a Massachusetts limited partnership (hereinafter, together with its
successors and assigns, referred to as "Holder").
R E C I T A L S:
A. On December 13, 1990, Holder entered into an Additional Interest
Agreement (the "Original Agreement") with H.O. Associates, Ltd. (the "Original
Mortgagor") with respect to a property located in Tampa, Florida more
particularly described in Schedule A (the "Land") and a multifamily housing
project to be constructed on the Land (the land and such project being
collectively the "Project").
B. The Original Mortgagor constructed the Project through a construction
and permanent mortgage loan in the principal amount of $13,154,200.00 (the
"Loan") made to the Original Mortgagor by Related Mortgage Corporation (together
with its successors and assigns as holder of the Loan) (the "Coinsuring
Lender");
C. The Loan was evidenced by a Mortgage Note (the "Original Note") executed
by the Original Mortgagor in favor of the Coinsuring Lender, and which Original
Note was (i) secured by a first Mortgage (the "Original Mortgage") on the
Project, and
(ii) coinsured by the United Stated Department of Housing and Urban Development
("HUD") under Section 221(d)(4) pursuant to Section 244 of the National Housing
Act, as amended;
D. The Coinsuring Lender financed the Loan through the issuance by the
Coinsuring Lender of fully-modified mortgage-backed pass-through construction
loan certificates ("CLCs") guaranteed as to the timely payment of principal and
interest by the Government National Mortgage Association and, upon the
redemption of such CLCs, a fully-modified mortgage-backed pass-through permanent
loan certificate ("PLC") guaranteed as to the timely payment of principal and
interest by the Government National Mortgage Association, which PLC was backed
by the Loan (the CLCs and PLC are sometimes hereinafter referred to as the
"Original GNMA Certificates");
E. The Coinsuring Lender obtained funding for the Loan through the issuance
of the Original GNMA Certificates to Holder. The interest rate on the Note and,
correspondingly, on the Original GNMA Certificates, were at rates below those
for comparable loans advanced and comparable securities issued, at the time the
Original Note was made.
F. To induce the Coinsuring Lender to issue the Original GNMA Certificates
at a rate below those available in the market for GNMA securities at the time of
their issuance and to induce the Holder to acquire said Original GNMA
Certificates at that below-market rate, the Original Mortgagor agreed to provide
to the Holder certain other additional interest not set forth in the
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Original Note or Original Mortgage as provided in the Original Agreement.
G. Holder, pursuant to a separate letter agreement dated as of June 22,
1994 with the Original Mortgagor (the "Letter Agreement"), has agreed to accept
certain sums payable out of the proceeds of the sale of the Project to the
Mortgagor and the performance of the Original Mortgagor undertakings under the
Letter Agreement in satisfaction of all Additional Interest due under the
Original Agreement;
H. The Mortgagor has agreed to purchase the Project from the Original
Mortgagor upon certain conditions including, but not limited to, the condition
that the Loan be modified to, among other things, reduce the interest rate to
7.875% per annum and that the Original Agreement and the documents securing the
Original Agreement be modified in certain respects.
I. The Original Mortgagor and the Coinsuring Lender have agreed to modify
the Original Note and the Original Mortgage pursuant to, among other documents,
a Modification of the Mortgage Note and Modification of the Mortgage and the
Mortgagor has agreed to assume the Loan as so modified.
J. Modification of the Loan requires the agreement of the Holder to the
reduction in interest rate and other modifications and the agreement of the
Holder to relinquish the Original GNMA Certificates and accept in substitution
therefor a new GNMA mortgage backed security bearing interest at the rate of
7.625% per annum (the "New GNMA Certificate").
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K. Holder has further agreed to a reduction of the interest rate on the
Loan and the other modifications to the Loan and the substitution of the New
GNMA Certificate for the Original GNMA Certificates in express reliance upon and
in consideration of the right of Holder to call the Loan due and payable in ten
(10) years as more particularly provided herein and the covenants and
undertakings of Borrower contained herein and in the documents securing this
Agreement.
NOW, THEREFORE, in consideration of the foregoing, of the Loan, as modified,
and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, subject to the requirements of the Secretary of Housing
and Urban Development as specified in Section 8 hereof, the Mortgagor and the
Holder hereby amend and restate the Original Agreement in its entirety and agree
as follows:
SECTION 1. DEFINITIONS.
Unless otherwise defined in this Agreement, the captioned terms herein
shall have the respective meanings set forth below:
(a) "ACCELERATED MATURITY DATE" shall mean the date to which the
Maturity Date has been accelerated pursuant to the provisions of Section 5(A).
(b) "ADDITIONAL INTEREST" shall mean and include "Shared Income
Interest" and "Shared Appreciation Interest," as such terms were defined in
Section 2 of the Original Agreement.
(c) "AGREEMENT" shall mean this Amended and Restated Agreement.
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(d) "COINSURANCE COVERAGE" shall refer to that certain insurance
coverage provided to the Holder of the Note by the Coinsuring Lender and the
United States Department of Housing and Urban Development, acting by and through
the Federal Housing Commissioner, in accordance with Section 207 pursuant to
Sections 221(d)(4) pursuant to Section 244 of the National Housing Act, as
amended and the applicable regulations promulgated thereunder, which insurance
coverage is evidenced by the endorsement on the Note by the Federal Housing
Commissioner.
(e) "COLLATERAL" shall mean that real and personal property in which a
security interest has been granted to the Holder in accordance with Section 3 of
this Agreement.
(f) "DEFAULT" shall mean any of the following:
(1) the Mortgagor shall fail to pay when due any installment of
principal, interest or other amount due under the Note or Mortgage or there is
otherwise a default under any of the Loan Documents, monetary or non-monetary,
and such failure to pay or default shall continue beyond any applicable grace
period contained in the Note, Mortgage or Loan Documents or any documents
executed in connection therewith, as applicable;
(2) the Mortgagor shall fail to pay the Outstanding Indebtedness
as and when required pursuant to Section 5 hereof or otherwise fail to observe
or perform any covenant or any other agreement or obligation to be observed or
performed by it under Section 11 hereof, and such failure to observe and perform
under Section 11 hereof shall continue for thirty (30)
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days after notice thereof from the Holder (or such other grace period as may be
provided for in any applicable document);
(3) the Mortgagor shall voluntarily seek liquidation or
reorganization under the United States Bankruptcy Code, as amended from time to
time, or consent to the institution of any involuntary petition thereunder
against it; or file a petition, answer or consent or otherwise institute any
similar proceeding under any other applicable federal or state law; or apply
for, or by consent or acquiescence there shall be an appointment of, a receiver,
liquidator, sequestrator, trustee or other officer with similar power; or make
an assignment for the benefit of creditors; or admit in writing its inability to
pay its indebtedness generally as it becomes due; or if an involuntary petition
shall be commenced seeking the liquidation or reorganization of the Mortgagor
under the United States Code or any similar proceeding shall be commenced under
any other applicable federal, state or provincial law and (a) the petition
commencing the involuntary action is not timely controverted, (b) the petition
commencing the involuntary action is not dismissed within sixty (60) days of its
filing, (c) an interim trustee is appointed to take possession of all or a
portion of the property, and/or to operate all or any part of the business of
Mortgagor, or (d) an order for relief shall have been issued or entered therein,
or a decree or order of a court having jurisdiction in the premises for the
appointment of a receiver, liquidator, sequestrator, trustee or other officer
having similar power for
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Mortgagor or for all or a part of its property, shall have been entered; or any
similar relief shall be granted under any applicable federal or state law.
(g) "HUD" shall mean the United States Department of Housing and Urban
Development, including the Secretary of Housing and Urban Development of the
United States or the authorized representative of such Secretary.
(h) "INITIAL ENDORSEMENT" shall mean the initial endorsement of the
Loan for coinsurance by the Secretary of Housing and Urban Development under
Section 221(d)(4) pursuant to Section 244 of the National Housing Act.
(i) "Loan" shall mean the mortgage loan to the Mortgagor from the
Coinsuring Lender in the original principal amount of $13,154,200.00 evidenced
by the Note and secured by the Mortgage.
(j) "LOAN DOCUMENTS" shall mean, collectively, the Note, the Mortgage,
together with all other documents by and between the Mortgagor and the
Coinsuring Lender evidencing or securing the Loan. "Loan Documents" does not
include this Agreement or any other document required solely by virtue of this
Agreement.
(k) "MATURITY DATE" shall mean the maturity date of the Loan, May 1,
2032.
(l) "MORTGAGE" shall mean that certain mortgage from the Original
Mortgagor granting a first lien on the Project for the benefit of the Coinsuring
Lender and securing the repayment
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of the Note, as amended by that certain Modification of Mortgage between the
Original Mortgagor and Coinsuring Lender of even date herewith.
(m) "NOTE" shall mean the promissory note of the Original Mortgagor
given to the Coinsuring Lender to evidence the Loan, as amended by a
Modification of Mortgage Note between the Original Mortgagor and the Coinsuring
Lender of even date herewith.
(n) "OUTSTANDING INDEBTEDNESS" shall mean:
(1) the unpaid principal balance of the Loan and all accrued and
unpaid interest thereon;
(2) any and all other sums then due and owing by the Mortgagor to
the Coinsuring Lender in accordance with the Note and Mortgage, including,
without limitation, (a) all late charges and any applicable premiums and fees,
(b) all amounts which the Coinsuring Lender may have advanced to pay obligations
of the Mortgagor under the Mortgage (including, without limitation, insurance
premiums, taxes, costs of maintenance and repair of the Project, title costs,
filing fees and charges, and attorneys fees), together with interest thereon at
the rate stipulated in the Note, and (c) all insurance proceeds or condemnation
awards to which the Coinsuring Lender shall then be entitled; and
(3) all amounts then due and owing by the Mortgagor to the Holder
for attorney fees, court costs or other charges in accordance with this
Agreement.
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(o) "PROJECT" shall mean that multi-family rental apartment complex
commonly known as Highland Oaks Apartments, located in Tampa, Florida,
containing 272 units and which complex is identified by the Coinsuring Lender as
FHA Project No. 067-36672.
(p) "REGULATORY AGREEMENT" shall mean that agreement regulating the
use and operation of the Project executed by and between the Mortgagor and
Coinsuring Lender dated of even date herewith; it being understood and agreed
that in the event Coinsurance Coverage is terminated pursuant to Section 5(C)
hereof, the Regulatory Agreement shall continue in full force and effect with
Holder assuming all rights, but not obligations, arising thereunder.
(q) "SUBORDINATED MORTGAGE" shall mean that Amended and Restated
Subordinated Mortgage from the Mortgagor of even date herewith granting a second
lien on the Project for the benefit of the Holder and securing the obligations
arising under this Agreement.
(r) "TPA" shall mean a Transfer of Physical Assets, as that term is
used in the regulations and administrative requirements of HUD relating to
projects financed by coinsured mortgage loans.
SECTION 2. RESTATEMENT OF OBLIGATIONS.
The parties acknowledge and agree that this Agreement amends and restates
and supersedes the Original Agreement in its entirety and that the Mortgagor is
not assuming any of the
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Original Mortgagor's obligations under the Original Agreement or any other
agreement between the Holder and the Original Mortgagor. Mortgagor's obligations
to Holder are embodied in this Agreement, the Subordinated Mortgage and in other
express written agreements or undertakings of the Mortgagor with or to Holder.
Without limiting the foregoing, Mortgagor shall have no obligation to pay any
Additional Interest to Holder or to pay any documentary stamps or intangible tax
on the subordinated mortgage executed by the Original Mortgagor securing the
Original Agreement or the Subordinated Mortgage.
SECTION 3. SECURITY FOR OBLIGATIONS.
A. As security for the performance of its obligations set forth in this
Agreement, the Mortgagor, subject to any prior rights of the Coinsuring Lender:
(i) has granted, of even date herewith, to the Holder, its successors and
assigns the Subordinated Mortgage in a form appropriate for recordation,
securing the obligations of Mortgagor as set forth in this Agreement, which
Subordinated Mortgage is subordinate and subject only to the Mortgage; and (ii)
hereby grants to the Holder, its successors and assigns, a second lien security
interest in tangible Project personal property more particularly described in
Schedule B attached hereto.
B. The Mortgagor and the Holder agree that this Agreement shall be and does
constitute a "Security Agreement", as that term is defined in the version of the
Uniform Commercial Code in effect in the State of Florida or any other
applicable
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jurisdiction, with respect to the security interests granted in subparagraphs
(i) and (ii) of paragraph A of this Section. The Mortgagor, upon request of the
Holder, will execute such financing statements, notices of lien, notices of
assignment, and continuations or amendments to any of the foregoing and other
documents (and pay the costs reasonably deemed necessary by the Holder) and do
such other acts and things, all as the Holder may from time to time reasonably
request in order to establish and maintain a valid security interest in the
Collateral provided for hereunder in order to secure the payment of the
obligations and liabilities of Mortgagor to the Holder hereunder. The provisions
hereof are in addition to, and not in derogation of, the Subordinated Mortgage.
C. The Mortgagor will reimburse the Holder for all expenses, including
reasonable attorneys' fees and disbursements, incurred by the Holder in seeking
to collect any sums due hereunder or enforce any rights hereunder in the case of
Default.
SECTION 4. [THIS SECTION RESERVED].
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SECTION 5. ACCELERATION OF MATURITY DATE: REMEDIES ON DEFAULT.
A. On or after the tenth (10th) anniversary date of the date of this
Agreement, the Holder, upon at least six (6) calendar months' prior notice to
Mortgagor of Holder's intention, may accelerate, in its sole discretion, the
Maturity Date of the Loan to a date specified in said written notice. In such
event, the Holder and, if applicable, the Coinsuring Lender (subject to Section
5(C)) may demand that Mortgagor pay over on the Accelerated Maturity Date all of
the Outstanding Indebtedness.
B. In the event that the Holder elects to accelerate the maturity date of
all of the Outstanding Indebtedness (subject to the additional requirements in
connection with an acceleration of the Note and Mortgage set forth in Section
5(C)):
(1) The Holder shall require the Coinsuring Lender to declare all sums
due under the Mortgage and the Note to be immediately due and payable on the
Accelerated Maturity Date.
(2) If the Mortgagor fails to pay the Outstanding Indebtedness which
has been accelerated pursuant to this Section 5 on the Accelerated Maturity
Date, such failure shall constitute a Default under this Agreement.
(3) Failure to pay such Outstanding Indebtedness which has been
accelerated on the Accelerated Maturity Date as required hereunder shall entitle
the Holder, at its option, to do any one or more of the following, subject only
to the provisions contained in Section 5(C) hereof:
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(a) foreclose upon the Note and the Mortgage, if they have been
accelerated pursuant to the terms hereof; or
(b) avail itself of any one or all of the remedies provided in
this Agreement or in any security agreement referred to in this Agreement or the
Subordinated Mortgage or by law with respect to the Collateral or otherwise,
including, without limitation, to foreclose upon the Collateral and to retain,
dispose of or sell the Collateral and/or the proceeds thereof to pay all amounts
due to the Holder hereunder; or
(c) exercise any and all other remedies available to it at law or
in equity.
C. In the event that the Holder elects to accelerate the maturity date of
the Note and Mortgage under Section 5(B), the Coinsuring Lender shall deliver a
notice of acceleration of such maturity date to Mortgagor on such terms and
conditions as Holder may require consistent with the Coinsuring Lender/Holder
Agreement (as hereinafter defined), provided that, unless otherwise required or
agreed by HUD and the Coinsuring Lender, the Coinsurance Contract must be
terminated on or before the Accelerated Maturity Date set forth in such notice
and that, in connection with such termination, the Coinsuring Lender must first,
at the direction of the Holder, take such steps as are required of it under that
certain Amended and Restated Agreement between the Coinsuring Lender and Holder
("Coinsuring Lender/Holder Agreement") of even date herewith to: (a) cancel the
New GNMA Certificate; (b) terminate the Mortgage Coinsurance
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Coverage by completing Form HUD-9807 (Request for Termination of Multifamily
Mortgage Insurance) or such other forms as shall then be required by HUD to
effect such termination (which forms shall also be executed by the Mortgagor);
and (c) assign the Note and Mortgage to the Holder in accordance with the
Coinsuring Lender/Holder Agreement. Upon assignment of the Note and Mortgage to
Holder, both the Note and Mortgage shall be amended to provide that a Default
under this Agreement is a default under the Note and Mortgage. In accordance
with Section 11 hereof Mortgagor grants to the Holder an irrevocable and
unconditional power of attorney coupled with an interest to execute Form HUD-
9807 or other appropriate documents for and on behalf of Mortgagor in such
instance to cancel Coinsurance Coverage. The election of the Holder to
accelerate the Maturity Date pursuant to the foregoing provision shall not
affect the outstanding balance of principal and interest under the Note and the
Holder may not enforce an acceleration of the Note and a foreclosure on the
Mortgage unless and until the Coinsurance Coverage is terminated by the
Coinsuring Lender as provided in this Section 5(C) unless otherwise required or
agreed by HUD and the Coinsuring Lender; provided however that the Coinsuring
Lender shall deliver the aforementioned notice of acceleration, at Holder's
direction, on the terms and conditions set forth above. Any assignment of the
Holder's interest in this Agreement under Section 12(N) shall be subject to this
continuing obligation of the Coinsuring Lender unless the Coinsurance Coverage
has been
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cancelled. In the event the Coinsurance Coverage is terminated in accordance
herewith, all rights (but not obligations) of HUD and the Coinsuring Lender
shall be assigned to Holder and all Loan Documents shall be assigned to Holder.
D. In addition to the foregoing, the Holder may accelerate the Maturity
Date of all or a portion of the Outstanding Indebtedness in accordance with and
subject to the terms and conditions set forth in Sections 5(B) and 5(C) or
exercise other remedies available under the Subordinate Mortgage or at law or in
equity at any time upon an event of Default hereunder which is not cured within
any applicable grace period.
E. In pursuing any of the options set forth in this Section 5, the Holder
and the Coinsuring Lender shall comply with any applicable HUD rules,
regulations, procedures and requirements to the extent applicable, including,
without limitation, any applicable TPA requirements. Notwithstanding anything
contained herein to the contrary, Holder shall have the right to cancel the
Coinsurance Coverage in its sole discretion subject to compliance with the terms
and conditions set forth herein, in which event Holder shall become assignee of
all rights of the Coinsuring Lender.
F. The Holder, at any time or from time to time, including after a notice
of acceleration of the Maturity Date as provided herein, may elect to extend the
Maturity Date by giving written notice of such election to Mortgagor.
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G. All rights and remedies of Holder provided for herein upon an event of
Default hereunder, which include, without limitation, direction to the
Coinsuring Lender to require immediate prepayment of the Loan and action in law
against the Mortgagor, shall be cumulative one to another, and shall not be in
derogation of any other legal or equitable rights or remedies of Holder.
SECTION 6. COINSURANCE COVERAGE.
A. If the Holder has caused the Coinsuring Lender to cancel the Coinsurance
Coverage pursuant to Section 5(C) above, the Coinsuring Lender shall first
cancel the New GNMA Certificate in accordance with GNMA requirements and then
terminate the Coinsurance Coverage in accordance with the requirements of HUD.
(1) The Mortgagor, in accordance with Section 11 of this Agreement,
has given to the Holder a Consent and Power of Attorney in order to effect a
termination of the Coinsurance Coverage.
(2) As more specifically provided for in Section 11, the Mortgagor
hereby consents to such termination of the Coinsurance Coverage, and the
Holder hereby is empowered to take such actions, if any, required on behalf
of the Mortgagor as its attorney-in-fact coupled with an interest, to
terminate the Coinsurance Coverage in such event, subject to the
responsibilities of the Coinsuring Lender.
B. Immediately upon cancellation of the Coinsurance
Coverage, the Note and Mortgage shall be assigned to the Holder
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by the Coinsuring Lender and all of the obligations of the Mortgagor pursuant to
this Agreement shall be deemed automatically to be inserted into and become a
part of the Note and the Mortgage as of the cancellation of Coinsurance Coverage
and to be secured by the Mortgage from and after such date to the same extent as
if such obligations were an original part of the Note and, the Mortgage; it
being further agreed that all rights (but not obligations) of HUD and the
Coinsuring Lender shall be assigned to Holder and all other Loan Documents,
including but not limited to the Regulatory Agreement, shall be assigned to
Holder and all references to HUD or the Coinsuring Lender shall be deemed to
refer to Holder.
C. In the event the Coinsurance Coverage has been cancelled, Mortgagor
hereby agrees to continue to pay monthly to the Holder, for so long as any
amounts remain outstanding under the Note and the Mortgage, in addition to all
other amounts becoming due thereunder, an amount equal to the monthly mortgage
insurance premium previously paid to the Coinsuring Lender and HUD as an
additional fee under this Agreement.
SECTION 7. MORTGAGE PRESERVATION.
If the Holder does not elect to accelerate the Maturity Date, or if the
Coinsuring Lender does not cancel the New GNMA Certificate(s) and terminate the
Coinsurance Coverage, then all of the Holder's rights and remedies under this
Agreement shall remain in full force and effect. So long as no merger of title
occurs under state law, the Holder or its assigns may continue to
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exercise and maintain all of its rights hereunder even if the ownership
interests of the Mortgagor may have been acquired pursuant to a Default
hereunder.
SECTION 8.
REQUIREMENTS OF THE SECRETARY OF HOUSING AND URBAN DEVELOPMENT.
A. The undertakings and obligations of Mortgagor hereunder are separate and
independent from its undertakings and obligations under the Note, the Mortgage
and the Regulatory Agreement. So long as the Coinsurance Coverage remains in
force, no default or breach of warranty or covenant by Mortgagor under this
Agreement shall constitute a default under the Note and/or Mortgage or give rise
to any claim under or in respect to the Coinsurance Coverage unless such default
also constitutes a default or breach of warranty or covenant under the Note,
Mortgage or other Loan Documents. In no event shall the Holder, its successors
or assigns be entitled to seek recovery of any coinsurance benefits or seek
other remedies against the Secretary of Housing and Urban Development with
respect to any sums due under this Agreement.
B. So long as the Secretary of Housing and Urban Development or his
successor or assignee, is the coinsurer of the Note, Mortgagor shall have no
obligation to make any payments hereunder other than from (i) distributable
Surplus Cash (as that term is defined in the Regulatory Agreement referred to
and incorporated in the Mortgage) to the extent permitted by the Regulatory
Agreement, and (ii) capital contributions of its
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stockholders, net proceeds of sale, proceeds of refinancing or other funds or
assets of Mortgagor whose distribution is not restricted by the terms of the
Regulatory Agreement. Nothing contained herein is intended to relieve or modify
the obligations of Mortgagor to pay any and all sums due on or under the terms
of the Note, the Mortgage and the Regulatory Agreement nor is it intended to
limit the remedies of the Holder set forth in this Agreement, including without
limitation, Section 5 hereof, upon Default in the collection of Surplus Cash or
unrestricted cash.
C. Nothing herein is intended to alter or conflict with the terms,
conditions, and provisions of the HUD regulations, handbooks, administrative
requirements, and lender notices in effect at the time of Initial Endorsement of
the Note for coinsurance by HUD, or the documents required to be executed by the
Mortgagor in connection with the Initial Endorsement of the Note for coinsurance
by HUD; and to the extent that they do so, the HUD regulations handbooks,
administrative requirements, lender notices and documents shall control, and
this Agreement shall be amended or deemed amended so as not to alter or conflict
with the aforesaid regulations, handbooks, administrative requirements, notices
or documents.
D. The provisions of this Section 8 shall automatically terminate and be of
no further force or effect upon cancellation or termination of the Coinsurance
Coverage with respect to the Note.
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E. No right or remedy of the Holder contained herein shall be in derogation
of any grace period or right to cure which Mortgagor may have under the Note.
Mortgage or any other Loan Documents.
F. Holder may not disapprove or impede a HUD TPA that has been approved by
the Coinsuring Lender or HUD to protect the interests of HUD's insurance funds.
SECTION 9. WAIVER OF PREPAYMENT CHARGE.
If the Holder has elected to accelerate the Maturity Date of the Note and
Mortgage pursuant to Section 5 and the Mortgagor thereafter timely pays the Loan
in full on or prior to the Accelerated Maturity Date without action having been
taken by the Holder to foreclose or otherwise exercise remedies by reason of the
Mortgagor's failure to timely pay the Loan, the Holder agrees to waive the one
percent (1%) prepayment charge provided in the Note. The Holder agrees to
provide appropriate notice and instructions to the Coinsuring Lender to confirm
such waiver upon such timely payment of the Loan.
SECTION 10. REPRESENTATIONS AND WARRANTIES.
The Mortgagor hereby represents and warrants as of the date of execution of
this Agreement, which representations and warranties shall survive the execution
of this Agreement and closing of the Loan:
A. The Mortgagor is the lawful owner of the Collateral;
B. The Mortgagor has full power and authority to execute this Agreement and
to perform the obligations hereunder and to
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subject the Collateral to the security interest granted hereunder;
C. The execution, delivery and performance of this Agreement by the
Mortgagor will not result in the violation of the Mortgagor's organizational
documents or bylaws, any mortgage, indenture, material contract, instrument,
agreement, judgment, decree, order, statute, rule or regulation to which the
Mortgagor is subject or is bound.
D. To the best of Mortgagor's knowledge, there is no litigation now pending
or threatened by or against the Mortgagor which, if adversely decided, would
materially impair the ability of the Mortgagor to pay and perform its
obligations.
SECTION 11. POWER OF ATTORNEY.
In order for the Holder to undertake certain rights and remedies to which
it is entitled under this Agreement, the Coinsurance Coverage must be cancelled.
Under HUD regulation 24 C.F.R. Section 255.813(a)(5), the Mortgagor and the
Coinsuring Lender must jointly request the termination of the Coinsurance
Coverage in the event the parties should desire to cancel any insurance benefits
thereunder even in the event the cancellation results from an acceleration of
the Maturity Date.
The parties therefore mutually agree and the Mortgagor hereby consents to
the appointment of the Holder (its successors and assigns) as the Mortgagor's
true and lawful attorney-in-fact for the purpose of cancelling the Coinsurance
Coverage solely at
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the request and direction of the Holder, its successors or as provided for under
this Agreement.
The Mortgagor agrees to execute any and all documents, at the request of
the Holder, which the Holder, in its reasonable discretion, deems necessary or
appropriate to cancel the Coinsurance Coverage including a separate document
which may be in a different form but which may be required by local law to
create a valid power of attorney.
The Mortgagor has made, constituted and appointed, and by these presents
does make, constitute and appoint the Holder, its successors and assigns, its
true and lawful attorney-in-fact, in its name or otherwise to do any and all
acts and to execute any and all documents which may be necessary or, in the
reasonable opinion of the Holder, desirable to effect the termination of the
Coinsurance Coverage. This Power of Attorney is irrevocable, coupled with an
interest and is given with full power of substitution, and the Mortgagor hereby
ratifies and confirms all that the Holder or substitute shall lawfully do or
cause to be done by virtue hereof.
This Power of Attorney shall remain in full force and effect until this
Agreement is paid in full in current funds and all obligations arising hereunder
are otherwise satisfied in all respects.
SECTION 12. GENERAL PROVISIONS.
A. Amounts payable pursuant to this Agreement shall be payable to Holder at
the same address as notices are to be
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delivered or at such other place as the Holder may designate in writing.
B. The failure of the Holder to exercise its option for acceleration of
maturity, foreclosure, or either, following any Default as aforesaid or to
exercise any other option granted to it hereunder or the acceptance by the
Holder of partial payments or partial performance, shall not constitute a waiver
of any such Default or option but such rights of the Holder shall remain
continuously in force. Acceleration of maturity or other rights granted to the
Holder hereunder, once claimed hereunder by the Holder after a Default
hereunder, may at its option be rescinded or extended by written notice to that
effect. The tender and acceptance of partial payment or partial performance
alone shall not in any way affect or rescind an acceleration of maturity by the
Holder.
C. If the Outstanding Indebtedness is not paid by Mortgagor as and when
required under Section 5, Mortgagor agrees to pay all costs of collection,
including but not limited to, court costs and reasonable attorney's fees,
whether or not suit is filed thereon.
D. Mortgagor (i) waives presentment, protest and demand, notice of protest,
notice of dishonor and nonpayment of amounts due hereunder, and every other
notice of any kind respecting this Agreement; and (ii) to the extent not
prohibited by law, waives the benefit of any law or rule of law intended for its
advantage or protection which would enable its release or discharge from
23
liability hereon, in whole or in part, for any reason other than full and
complete payment of all amounts due hereunder; and (iii) expressly agrees that
this Agreement, or any payment hereunder, may be extended from time to time in
the sole discretion of the Holder without in any way affecting the liability of
Mortgagor, its successors and assigns.
E. In the event that any one or more of the provisions contained herein
are, for any reason, held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provision of this Agreement and this Agreement shall be construed as if
such invalid, illegal or unenforceable provision had never been contained
herein.
F. Notwithstanding anything to the contrary herein contained or implied,
neither the Coinsuring Lender nor the Holder, by executing this Agreement, the
Note or the Mortgage or by any action pursuant thereto, shall be deemed a
partner of or joint venturer with the Mortgagor. The relationship between
Mortgagor and the Holder created hereunder is solely that of debtor/creditor,
and neither party shall hold itself out as a partner, agent or affiliate of the
other.
G. This Agreement may not be changed orally, but only by an agreement in
writing signed by the party against whom enforcement of any waiver, change,
modification or discharge is sought.
24
H. The rights granted to the Holder in this Agreement are in addition to,
and are not in derogation of, any and all rights which the Holder may have under
the Loan Documents and otherwise may have to sell, assign or transfer the New
GNMA Certificate.
I. From time to time, the Mortgagor and Holder shall furnish to each other,
upon the reasonable request of the other, an estoppel certificate setting forth
any known defaults hereunder or under any of the Loan Documents and the
Mortgagor and Holder shall make respective determinations of the total amounts
then due to the Holder hereunder. Any such estoppel certificate shall be binding
upon the party issuing the estoppel certificate and may be relied upon by the
party to whom the estoppel certificate is addressed.
J. Notwithstanding anything contained herein to the contrary, the Mortgagor
agrees, upon the request of the Holder made at any time after the termination of
the Coinsurance Coverage, to modify the Mortgage so that the Mortgage will
thereafter set forth all of the Holder's rights under this Agreement and the
remedies available to the Holder under this Agreement, including, without
limitation, the Holder's right to an acceleration.
K. All notices given pursuant to this Agreement shall be in writing and
shall be hand delivered or mailed, registered U.S. Mail, return receipt
requested to the parties at the address specified below or to such other address
as may be specified by a party upon notice in compliance with this paragraph.
25
If to Mortgagor:
Richland Properties, Inc.
c/o Newco Management Company
6320 Canoga Avenue, Suite 1430
Woodland Hills, CA 91367-2591
Attn: Vahe M. Melkonian
If to Holder:
NYLife Government Mortgage Plus Limited
Partnership
c/o NYLife Realty, Inc., as general partner
51 Madison Avenue, Room 1710
New York, N.Y. 10010
with a copy to:
New York Life Insurance Company
51 Madison Avenue
New York, New York 10010
Attention: Senior Vice President
Mortgage Finance Department
L. This Agreement shall be given effect and construed by application of the
laws of the State of Florida.
M. The rights under and interests in this Agreement shall be freely
assignable on the part of the Holder so long as the New GNMA Certificate are
simultaneously assigned to the same assignee. The Holder shall not be required
to assign this Agreement to an assignee which takes an assignment of the GNMA
Certificate(s) to which this Agreement relates but any such assignment of this
New GNMA Certificate without simultaneous assignment of this Agreement shall
operate to automatically terminate this Agreement. It is recognized that the
responsibility to actually terminate the Coinsurance Coverage is not assignable
by the Coinsuring Lender and at all times will be retained by the Coinsuring
Lender. However, the Holder has the
26
right to cause the Coinsurance Coverage to be cancelled by the Coinsuring Lender
in accordance with Section 5(C) of this Agreement and this right may be assigned
along with the other rights and obligations provided for herein. Whenever the
Holder assigns its rights hereunder, the Coinsuring Lender shall acknowledge its
responsibilities hereunder to the assignee in said assignment.
The Coinsuring Lender hereby agrees to take all actions required of it by
the Holder to terminate the Coinsurance Coverage in accordance with Section 5(C)
and the Coinsuring Lender/Holder Agreement in the event it is directed to do so
by an assignee of the Holder of this Agreement and further agrees that this
undertaking on its part is intended to survive the assignment of Holder's rights
hereunder.
N. (1) In the event of any Default hereunder, Holder shall have full
recourse to the Subordinated Mortgage and to the other Collateral given by
Mortgagor to secure the obligations arising hereunder; provided however, that
subject to subparagraphs (2) and (3) hereof, the liability and obligations of
Mortgagor to perform, observe, pay and make good the monetary obligations or the
performance or observance of any of the covenants or other non-monetary
obligations of Mortgagor hereunder or under any of the Loan Documents shall not
be enforced by any action or proceeding wherein damages or any money judgment
shall be sought against Mortgagor or any of its officers, directors or
shareholders, except a foreclosure action or other appropriate
27
action or proceeding required to enable Mortgagee to enforce and realize upon
the Loan Documents and the mortgage lien, security interest and creditors'
rights of any other nature related to the Project or any other real or personal
property described in the Loan Documents, but any judgment in any such action or
proceeding shall be enforced against Mortgagor only to the extent of Mortgagor's
interest in the Mortgaged Property and the other real and personal property
which is the subject of the Loan Documents, with Holder precluded from suing
for, seeking or demanding a deficiency judgment against Mortgagor or any of its
officers, directors or shareholders in any such action or proceeding.
(2) (a) Notwithstanding anything to the contrary continued in
subparagraph (1) hereof, the provisions of subparagraph (1) shall not:
(i) impair in any way the mortgage lien of the Subordinated
Mortgage and the security interest of this Agreement upon the Project or the
right of Holder to collect all monetary obligations in any manner except through
pursuit of personal liability of Mortgagor or any of its officers, shareholders
or directors;
(ii) prevent the failure to pay the outstanding indebtedness
as required by Section 5, from constituting a Default;
(iii) prejudice the right of Holder as to any covenants and
conditions of the Loan Documents excluding rights to recover monetary damages.
28
(b) Notwithstanding anything contained in this paragraph N to the
contrary, the provisions of subparagraph (1) hereof shall be inapplicable and
Mortgagor shall be personally liable and a personal judgment may be sought
against Mortgagor or the principals of Mortgagor in the event of any fraud or
misrepresentation of Mortgagor with respect to the Loan Documents and/or the
consummation of the transaction contemplated by the Loan Documents.
(3) Nothing in this paragraph N shall be deemed to be a waiver of any
right which Holder may have under Sections 506(a), 506(b), 1111(b) or any other
provision of Bankruptcy Reform Act of 1978 or any amendments thereto (the
"Bankruptcy Act"), to file a claim for the full amount of the debt owing to
Holder by Mortgagor or to require that all collateral shall continue to secure
all of the monetary and nonmonetary obligations in accordance with the Loan
Documents, but the Holder's rights with respect to any such claim shall be
subject to the limitations on personal liability contained in subparagraphs (1)
and (2).
O. The captions and headings of the paragraphs of this Agreement are for
convenience only and are not to be used to interpret or define the provisions
hereof.
P. If the Coinsuring Lender acquires title to the Project, following a
default, and the contract of coinsurance is in force, all of Holder's rights and
benefits hereunder and under the Subordinated Mortgage shall terminate. If the
Loan shall be
29
assigned to HUD following a default thereunder, (following its assignment to
GNMA), Holder shall assign to HUD its rights and benefits under this Agreement
and the Subordinated Mortgage.
Q. Upon the satisfaction of all obligations arising hereunder the Loan
Documents, this Agreement shall cease, terminate, and be absolutely null and
void.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
30
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the day and year first above written.
MORTGAGOR:
RICHLAND PROPERTIES, INC.,
a Delaware corporation
By: /s/ Vahe M. Melkonian
---------------------------
Name: Vahe M. Melkonian
-------------------------
Title: Vice President
------------------------
HOLDER:
NYLIFE GOVERNMENT MORTGAGE PLUS
LIMITED PARTNERSHIP, a
Massachusetts limited partnership
By: NYLife Realty, Inc.,
General Partner
By: /s/ Kevin M. Micucci
----------------------
Name: Kevin M. Micucci
--------------------
Title: Vice President
-------------------
31
RELATED MORTGAGE CORPORATION hereby consents and agrees to this Amended and
Restated Agreement as of the 3lst day of January, 1995 subject to the terms of
the Amended and Restated Coinsuring Lender/Holder Agreement between NYLIFE
Government Mortgage Plus Limited Partnership and Related Mortgage Corporation of
even date. Said Amended and Restated Coinsuring Lender/Holder Agreement shall be
controlling as to any interpretation of the obligations or undertakings of
Related Mortgage Corporation under this Agreement.
RELATED MORTGAGE CORPORATION
By: /s/ Bruce H. Brown
------------------------
Name: Bruce H. Brown
------------------------
Title: Vice President
-----------------------
32
STATE OF FLORIDA )
) ss:
COUNTY OF HILLSBOROUGH)
On this, the 31 day of January, 1995, before me personally appeared Vahe
Melkonian, to me known, who, being by me duly sworn, did depose and say, that
he/she is the V.P. of Richland Properties, Inc., a Delaware corporation, the
corporation described in and which executed the above instrument; that he/she
knows the seal of the corporation; that the seal affixed to said instrument
is such corporate seal; that it was so affixed by the order of the Board of
Directors of said corporation, and that he/she signed his/her name thereto by
like order.
/s/ Sherry Logsdon
---------------------------
Notary Public
[SEAL]
My Commission expires:
[Notary Stamp]
- ---------------------
STATE OF FLORIDA )
) ss:
COUNTY OF HILLSBOROUGH)
On this, the 31 day of January, 1995, before me personally appeared
Kevin Micucci, to be known, who, being by me duly sworn, did depose and say,
that he/she is the V.P. of NYLIFE REALTY, INC., general partner of NYLIFE
GOVERNMENT MORTGAGE PLUS LIMITED PARTNERSHIP, a Massachusetts limited
partnership, the corporation described in and which executed the above
instrument; that he/she knows the seal of the corporation; that the seal affixed
to said instrument is such corporate seal; that it was so affixed by the order
of the Board of Directors of said corporation, and that he/she signed his/her
name thereto by like order.
/s/ Sherry Logsdon
---------------------------
Notary Public
[SEAL]
My Commission expires:
[Notary Stamp]
- ---------------------
33
STATE OF FLORIDA )
) ss:
COUNTY OF HILLSBOROUGH)
On this, the 31 day of January, 1995, before me personally appeared
Bruce Brown, to me known, who, being by me duly sworn, did depose and say,
that he/she is the V.P. of Related Mortgage Corporation, a Delaware
corporation, the corporation described in and which executed the above
instrument; that he/she knows the seal of the corporation; that the seal
affixed to said instrument is such corporate seal; that it was so affixed by
the order of the Board of Directors of said corporation, and that he/she
signed his/her name thereto by like order.
/s/ Sherry Logsdon
---------------------------
Notary Public
[SEAL]
My Commission expires:
[Notary Stamp]
- ---------------------
34
SCHEDULE A
LEGAL DESCRIPTION
Parcel 22B, HUNTER'S GREEN, as per map or plat thereof as recorded in Plat Book
69, Page 5, of the Public Records of Hillsborough County, Florida.
SCHEDULE B
DESCRIPTION OF PERSONAL PROPERTY
1. All materials now owned or hereafter acquired by the Debtor and intended
for construction, reconstruction, alteration and repair of any building,
structure or improvement now or hereafter erected or placed on the property
described in Exhibit "A" (the "Property"), all of which materials shall be
deemed to be included within the Project immediately upon the delivery
thereof to the Project.
2. All of the walks, fences, shrubbery, driveways, fixtures, machinery,
apparatus, equipment, fittings, and other goods and other personal property
of every kind and description whatsoever, now owned or hereafter acquired
by the Debtor and attached to or contained in and used or usable in
connection with any present or future operation of the Project, including,
by way of example rather than of limitation, all lighting, laundry,
incinerating and power equipment; all engines, boilers, machines, motors,
furnaces, compressors and transformers; all generating equipment; all
pumps, tanks, ducts, conduits, wire, switches, electrical equipment and
fixtures, fans and switchboards; all telephone equipment; all piping,
tubing, plumbing equipment and fixtures; all heating, refrigeration, air
conditioning, cooling, ventilating, sprinkling, water, power and
communications equipment, systems and apparatus; all water coolers and
water heaters; all fire prevention, alarm and extinguishing systems and
apparatus; all cleaning equipment; all lift, elevator and escalator
equipment and apparatus; all partitions, shades, blinds, awnings, screens,
screen doors, storm doors, exterior and interior signs, gas fixtures,
stoves, ovens, refrigerators, garbage disposals, dishwashers, cabinets,
mirrors, mantles, floor coverings, carpets, rugs, draperies and other
furnishings and furniture installed or to be installed or used or usable in
the operation of any part of the Project or facilities erected or to be
erected in or upon the Property; and every renewal or replacement thereof
or articles in substitution therefor, whether or not the same are now or
hereafter attached to the Property in any manner; all except for any right,
title or interest therein owned by any tenant (it being agreed that all
personal property owned by the Debtor and placed by it on the Property
shall, so far as permitted by law, be deemed to be affixed to the Property,
appropriated to its use, and covered by the each of the Security Documents
to which this Exhibit is attached).
3. All of the Debtor's rights, title and interest in and to any and all
judgments, awards of damages (including but not limited to severance and
consequential damages), payments, proceeds, settlements or other
compensation (collectively, the "Awards") heretofore or hereafter made,
including interest thereon, and the right to receive the same, as a result
of, in connection with, or in lieu of (i) any taking of the Property or any
part thereof by the exercise of the power of condemnation or eminent
domain, or the police power, (ii) any change or alteration of the grade of
any street, or (iii) any other injury or decrease in the value of the
Property or any part thereof (including but not limited to destruction or
decrease in value by fire or other casualty), all of which Awards, rights
thereto and shares therein are hereby assigned to the Secured Party, who is
hereby authorized to collect and receive the proceeds thereof and to give
property receipts and acquittances therefor and to apply, at its option,
the net proceeds thereof, after deducting expenses of collection, as a
credit upon any portion, as selected by the Secured Party, of the
indebtedness secured by the Security Documents.
4. All of the Debtor's right, title and interest in and to any and all
payments, proceeds, settlements or other compensation heretofore or
hereafter made, including any interest thereon, and the right to receive
the same from any and all insurance policies covering the Property or any
portion thereof, or any of the other property described herein.
5. The interest of the Debtor in and to all of the rents, royalties, issues,
profits, revenues, income and other benefits of the Property, or arising
from the use or enjoyment of all or any portion thereof, or from any lease
or agreement pertaining thereto, and all right, title and interest of the
Debtor in and to, and remedies under, all contract rights, accounts
receivable and general intangibles arising out of or in connection with any
and all leases and subleases of the Property, or any part thereof, and of
the other property described herein, or any part thereof, both now in
existence or hereafter entered into, together with all proceeds (cash and
non-cash) thereof; and including, without limitation, all cash or
securities deposited thereunder to secure performance by the lessees of
their obligations thereunder.
6. All of the Debtor's rights, options, powers and privileges in and to (but
not the Debtor's obligations and burdens under) any construction contract,
architectural and engineering agreements and management contract pertaining
to the construction, development, ownership, equipping and management of
the Property and all of the Debtor's right, title and interest in and to
(but not the Debtor's obligations and burdens under) all architectural,
engineering and similar plans, specifications, drawings, reports, surveys,
plats, permits and the like, contracts for construction, operation and
maintenance of, or provision of services to, the Property or any of the
other property described herein, and all sewer taps and allocations,
agreements for utilities, bonds and the like, all relating to the Property.
7. All intangible personal property, accounts, licenses, permits, instruments,
contract rights, and chattel paper of the Debtor, including but not limited
to cash; accounts receivable; bank accounts; certificates of deposit;
securities; promissory notes; rents; rights (if any) to amounts held in
escrow; insurance proceeds; condemnation rights; deposits; judgments,
liens and causes of action; warranties and guarantees.
8. The interest of the Debtor in any cash escrow fund and in any and all
funds, securities, instruments, documents and other property which are at
any time paid to, deposited with, under the control of, or in the
possession of the Secured Party, or any of its agents, branches,
affiliates, correspondents or others acting on its behalf, which rights
shall be in addition to any right of set-off or right of lien that the
Secured Party may otherwise enjoy under applicable law, regardless of
whether the same arose out of or relates in any way, whether directly or
indirectly, to the Project located upon the Property.
9. The interest of the Debtor in and to any and all funds created or
established and held by the Trustee pursuant to any indenture of trust or
similar instrument authorizing the issuance of bonds or notes for the
purpose of financing the Project located upon the Property.
10. Any collateral provided by the Debtor or for its account to each and every
issuer of a letter of credit, subject to the prior claim of the issuer of
any such letter of credit to such collateral.
11. All inventory, including raw materials, components, work-in-process,
finished merchandise and packing and shipping materials.
12. Proceeds, products, returns, additions, accessions and substitutions of and
to any or all of the above.
13. Any of the above arising or acquired by the Debtor or to which the Debtor
may have a legal or beneficial interest in on the date hereof and at any
time in the future.
14. Any of the above which may become fixtures by virtue of attachment to
Property.
15. All of the records and books of account now or hereafter maintained by or
on behalf of the Debtor in connection with the Project.
16. All names now or hereafter used in connection with the Project and the
goodwill associated therewith.
-2-