PROMISSORY NOTE
US $2,500,000.00 Nassau County, New York
FOR VALUE RECEIVED, the undersigned, jointly and severally if more than
one, promises to pay CNL FINANCIAL I, INC., a Florida corporation, or order, the
principal sum of TWO MILLION FIVE HUNDRED THOUSAND AND NO/1OO DOLLARS
(US$2,500,000.00) with interest on the unpaid principal balance from the date of
this Note, until paid, at the rate of 10.002 percent per annum. The principal
and interest shall be payable at 400 East South Street, Suite 500, Orlando,
Florida 32801, or such other place as the holder hereof may designate in
writing, in consecutive monthly installments of Thirty-Three Thousand Forty and
45/100 Dollars ($33,040.45) on the first (1st) day of each month beginning May
1, 1997, until the entire indebtedness evidenced hereby is fully paid, except
that any remaining indebtedness, if not sooner paid, shall be due and payable on
April 1, 2007 (the "Maturity Date"). All computation of interest shall be made
by the holder on the basis of a year of 360 days and shall be allocated in
twelve (12) equal monthly installments.
If any installment under this Note is not received by the holder hereof
within ten (10) calendar days after Lender's written demand for such amount, the
entire principal amount outstanding hereunder and accrued interest thereon shall
at once become due and payable, at the option of the holder hereof. The holder
hereof may exercise this option to accelerate during any Default (as hereinafter
defined) by the undersigned regardless of any prior forbearance. In the event of
any Default under this Note or any Instrument or any other Loan Document (as
such terms are hereinafter defined), and if the same is referred to an attorney
at law for collection or any action at law or in equity is brought with respect
hereto, the undersigned shall pay the holder hereof all reasonable expenses and
costs, including, but not limited to, reasonable attorneys' fees and expenses,
including reasonable attorneys' fees and expenses on any appeal. Any forbearance
by the holder in exercising any right or remedy under this Note or any
Instrument or any other Loan Document, or otherwise afforded by applicable law,
shall not be a waiver of or preclude the exercise of any right or remedy. The
acceptance by the holder of payment of any sum due hereunder after the due date
of such payment or after holder has declared an event of Default shall not be a
waiver of holder's right to either require prompt payment when due of all other
sums so secured or to declare a default for failure to make prompt payment.
If any installment under this Note is not received by the holder hereof
within ten (10) calendar days after the installment is due, the undersigned
shall pay to the holder hereof a late charge of five percent (5%) of such
installment, such late charge to be immediately due and payable without demand
by the holder hereof. If any installment under this Note or any other monetary
payment due under this Note, any Instrument or any other Loan Document remains
past due for ten (10) calendar days or more after Lender's written demand for
such amount, or if there
shall exist any other Default under this Note, any Instrument or any other Loan
Document (after any applicable notice or cure period provided therein or
herein), the outstanding balance of this Note shall bear interest during the
period in which the undersigned is in Default at the lesser of four percent
(4%) over the Note rate or the highest rate allowed by applicable law.
From time to time, without affecting the obligation of the undersigned or
the successors or assigns of the undersigned to pay the outstanding principal
balance of this Note and observe the covenants of the undersigned contained
herein (after any applicable notice or cure period provided therein or herein)
and without affecting the guaranty of any person, corporation, partnership or
other entity for payment of the outstanding principal balance of this Note,
without giving notice to or obtaining the consent of the undersigned, the
successors or assigns of the undersigned or guarantors, and without liability on
the part of the holder hereof, the holder hereof may, at the option of the
holder hereof, release anyone liable on any of said outstanding principal
balance, accept a renewal of this Note, join in any extension or subordination
agreement, release any security given herefor, take or release other or
additional security, waive any term or provision of this Note, any Instrument or
any other Loan Document, and agree in writing with the undersigned (at the
undersigned's sole and absolute discretion) to extend the time for payment of
said outstanding principal balance or any part thereof, reduce the payments
thereon, modify the terms and time of payment of said outstanding principal
balance, modify the rate of interest or period of amortization of this Note,
change the amount of the monthly installments payable hereunder or otherwise
modify or amend any term or provision of this Note, any Instrument or any other
Loan Document.
Presentment, notice of dishonor, right to setoff and counterclaim, and
protest are hereby waived by all makers, sureties, guarantors and endorsers
hereof. This Note shall be the joint and several obligation of all makers,
sureties, guarantors and endorsers, and shall be binding upon them and their
successors and assigns.
The indebtedness evidenced by this Note is secured by that certain
Mortgage, Assignment of Rents and Security Agreement (herein referred to as the
"Instrument"), executed by the undersigned or its affiliates, and encumbering
certain real property more particularly described therein (herein referred to as
the "Property"), and reference is made thereto for rights as to acceleration of
the indebtedness evidenced by this Note. This Note shall be governed by the law
of the State of Illinois, except for enforcement rights as to any such Property
which must be governed by the law of any other jurisdiction in which any such
Property may be located.
A Default [as defined in any Instrument or any and all other notes,
instruments, documents and agreements evidencing or securing or relating to the
same or the indebtedness represented or secured thereby (herein a "Loan
Document")] under any Instrument or any Loan Document shall constitute a Default
under this Note.
Borrower's Initials: TJB
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Unless funds are advanced hereunder on the first day of the month, the
undersigned shall pay the holder hereof interest only, in advance, on the
outstanding principal balance of this Note at the rate set forth above from the
date that funds are advanced to and including the last day of the month on which
funds are so advanced.
Unless applicable law provides otherwise, so long as the undersigned is
not in Default hereunder, all payments received by the holder under this Note or
any Instrument shall be applied by holder in the following order of priority:
(i) amounts due and payable to holder by the undersigned for any advances made
by the holder under the Instrument or under any of the other Instruments or Loan
Documents for the purposes of paying taxes, insurance and other charges incurred
with respect to the Property; (ii) interest due and payable on the Note; (iii)
principal of the Note; (iv) interest due and payable on advances made by the
holder under the Instrument or under any of the other Instruments or Loan
Documents in order to protect the holder's security interest in any of the
collateral securing the Note; (v) principal of advances made by the holder under
the Instrument or under any of the other Instruments or Loan Documents in order
to protect the holder's security interest in any of the collateral securing the
Note; (vi) interest due and payable on any Future Advance (as such term is
defined in the Instrument), provided that if more than one Future Advance is
outstanding, the holder may apply payments received among the amounts of
interest payable on the Future Advances in such order as the holder, in the
holder's sole discretion, may determine; (vii) principal of any Future Advance,
provided that if more than one Future Advance is outstanding, the holder may
apply payments received among the principal balances of the Future Advances in
such order as the holder, in the holder's sole discretion, may determine; and
(viii) any other sums due and payable secured by this Instrument or under any of
the other Instruments in such order as the holder, at the holder's option, may
determine; provided, however, that the holder may, at the holder's option, apply
any sums payable on advances made by the holder under the Instrument or under
any of the other Instruments or Loan Documents in order to protect the holder's
security interest in any of the collateral securing the Note prior to interest
on and principal of the Note, but such application shall not otherwise affect
the order of priority of application herein. Upon the undersigned's Default
under this Note, the Instrument, any of the other Instruments or in any of the
other Loan Documents, the holder may apply any payments received by the holder
in any amount and in any order as the holder shall determine in the holder's
sole discretion.
ADDITIONAL COVENANTS. In addition to the covenants and agreements made in
this Note, the undersigned further covenants and agrees with and in favor of
holder as follows:
A. Prepayment Premium
1. Prepayment in Full
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At any time after the first one (1) year of the Note term and upon giving
holder sixty (60) days prior written notice, the undersigned may prepay the
entire unpaid principal balance of the Note on the last Business Day before a
scheduled monthly payment date by paying, in addition to the entire unpaid
principal balance, accrued interest, and any other sums due holder at the time
of prepayment, a Prepayment Premium equal to the greater of:
(a) 1% of the entire unpaid principal balance of the Note, or
(b) The present value of all remaining payments of principal and
interest discounted at an annual discount rate equal to the
"Termination Swap Rate" as defined below, less the present value of
all remaining payments of principal and interest discounted at the
CNL Swap Rate. For purposes of the foregoing, the "CNL Swap Rate"
shall be the rate, as fixed and determined by Lender in its
reasonable discretion on the date hereof, which is paid by Lender to
its (or which otherwise would be required to be received by an
experienced and qualified) interest rate swap counterparty for a
fixed rate loan swap in the notional amount and with the term of the
Loan, in order for each counterparty to pay on behalf of Lender a
floating rate equal to the 30-day LIBOR (London Inter-Bank Offering
Rate); and the "Termination Swap Rate" shall be the rate, as
determined by holder in its reasonable discretion as of the date and
time of any prepayment hereunder, which the holder can contract to
receive from its (or which otherwise would be paid by an experienced
and qualified) interest rate swap counterparty for a fixed rate loan
swap in the notional amount of and with the remaining amortization
terms of the amount being prepaid, in order for such counterparty to
accept a floating rate equal to the 30-day LIBOR (London Inter-Bank
Offering Rate), minus one-quarter of one percent (25 Basis Points).
No Prepayment Premium shall be due for any full prepayment made by the
undersigned, upon not less than thirty (30) days prior written notice to holder,
within ninety (90) days of the maturity date of the Note. By way of illustration
only, attached hereto as Exhibit "A" is a hypothetical calculation of the
Prepayment Premium.
Except as provided below, no partial prepayments are permitted.
2. Partial Prepayments
The undersigned shall have no right to make a partial prepayment of the
outstanding indebtedness during the Note term except as set forth below. In the
event that the holder shall require a partial prepayment of the outstanding
indebtedness after a Default under the Note, the Instrument or any of the other
Loan Documents, against the indebtedness secured by the Instrument, or, if the
holder shall for any other reason accept a partial prepayment by the
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undersigned of the outstanding indebtedness, in addition to the principal amount
being prepaid, accrued interest thereon and any other sums due holder at the
time of prepayment with respect thereto, a Prepayment Premium shall be due and
payable to the holder equal to the greater of:
(i) 1% of the amount of principal being prepaid, or
(ii) the "Swap Termination Costs," as defined below, plus one hundredth
of one percent (1 Basis Point) of the amount of principal being
prepaid for each month remaining in the Term of this Note as of the
date of any such prepayment. For purposes of the foregoing, the
"Swap Termination Costs" shall be defined as the costs actually
incurred by the holder as a result of and in connection with the
partial termination of any interest hedging or swap agreement
obtained for the Loan evidenced hereby to the extent of the notional
amount equal to the amount being prepaid or, at holder's election,
to obtain a new interest rate swap in such amount at the Loan Swap
Rate (as defined above) from an experienced and qualified interest
rate swap counterparty selected by holder for a fixed rate loan swap
in the notional amount of and with the remaining amortization terms
of the amount being prepaid, in order for such counterparty to
accept a floating rate equal to the 30-day LIBOR (London Inter-Bank
Offering Rate).
Except as provided in the next sentence, any partial prepayment of the
outstanding indebtedness shall not extend the due date of any subsequent monthly
installments or change the amount of such installments, unless the holder shall
otherwise agree in writing. Upon any partial prepayment, the holder shall have
the option, in its sole and absolute discretion, to recast the monthly
installments due under the Note so that the maturity date of the Note shall
remain the same.
3. Prepayment Premium Due Whether Voluntary or Involuntary Prepayment;
Insurance and Condemnation Proceeds
The undersigned shall pay the Prepayment Premium due under this Note
whether the prepayment is voluntary or involuntary (in connection with the
holder's acceleration of the unpaid principal balance of the Note) or the
Instrument is satisfied or released by foreclosure (whether by power of sale or
judicial proceeding), deed in lieu of foreclosure or by any other means.
Notwithstanding any other provision herein to the contrary, the undersigned
shall not be required to pay any Prepayment Premium in connection with any
prepayment occurring as a result of the application of insurance proceeds or
condemnation awards under the Instrument. For a prepayment occurring prior to
the time that a voluntary prepayment is permitted hereunder whether as a result
of acceleration of this Note or otherwise, then a Prepayment Premium shall
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be due and payable in the amount set forth above plus an additional five percent
(5%) of the principal amount prepaid.
If the undersigned shall give notice of a prepayment but shall fail, for
any reason, to make such prepayment, the undersigned shall immediately pay the
holder hereof any and all reasonable costs, fees and expenses (including
reasonable in house and outside attorneys' fees and expenses) associated with
the holder hereof's administrative preparation for such prepayment.
The Prepayment Premium is the negotiated charge between the undersigned
and the holder hereof for the privilege of the undersigned to prepay this Note
at the times provided above. The undersigned hereby covenants and agrees to
indemnify the holder hereof and hold it harmless from any reasonable costs,
fees, expenses (including attorneys' fees and expenses) resulting from any
action, litigation or judicial decision alleging, claiming or holding that the
Prepayment Premium is a penalty, and from any damages (whether compensatory or
punitive) ordered by a court, judge or administrative law judge which may
determine that the Prepayment Premium is a penalty.
4. Notice; Business Day
Any notice to the holder provided for in this Note shall be given in the
manner provided in the Instrument. The term "Business Day" means any day other
than a Saturday, a Sunday, or any other day on which the holder is not open for
business. Notices to the holder shall be by certified mail, return receipt
requested, or by national receipted overnight delivery service, to the address
of the holder as set forth above or as otherwise specified in writing by the
holder, and shall be effective only upon delivery or attempted delivery.
B. Assignment
This Note is freely assignable in whole or in part, from time to time, by
the holder and the holder may grant participation interest(s) herein. Without
limiting the foregoing, the undersigned understands and agrees that the holder
intends to and may sell, pledge, grant a security interest in, collaterally
assign, transfer, deliver or otherwise dispose of this Note and the
undersigned's other Loan Documents (or any interest therein, or its rights and
powers thereunder), from time to time, in connection with the Securitization (as
defined in the Instrument). This Note shall be binding upon the undersigned, its
heirs, devises, administrators, executives, personal representatives,
successors, receivers, trustees, permitted assignees, including all successors
in interest of the undersigned, and shall inure to the benefit of the holder
hereof, and the successors and assignees of the holder hereof.
C. Governing Law; Miscellaneous
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This Note shall be governed by and construed in accordance with the laws
of the State of Illinois and applicable federal law, except for enforcement
rights as to any such Property which must be governed by the law of any other
jurisdiction in which any such Property may be located. The parties hereto
intend to conform strictly to the applicable usury laws. In no event, whether by
reason of demand for payment, prepayment, acceleration of the maturity hereof or
otherwise, shall the interest contracted for, charged or received by the holder
hereof hereunder or otherwise exceed the maximum amount permissible under
applicable law. If from any circumstance whatsoever interest would otherwise by
payable to the holder in excess of the maximum lawful amount permitted by
applicable law. If the holder hereof shall ever receive anything of value deemed
interest under applicable law which would apart from this provision be in excess
of the maximum lawful amount, an amount equal to any amount which would have
been excessive interest shall be applied to the reduction of the principal
amount owing hereunder in the inverse order of its maturity and not to the
payment of interest, or if such amount which would have been excessive interest
exceeds the unpaid balance of principal hereof, such excess shall be refunded to
the undersigned. All interest paid or agreed to be paid to the holder hereof
shall, to the extent permitted by applicable law, be amortized, prorated,
allocated, and spread throughout the full stated term (including any renewal or
extension) of such indebtedness so that the amount of interest on account of
such indebtedness does not exceed the maximum permitted by applicable law. The
provisions of the paragraph shall control all existing and future agreements
between the undersigned and the holder hereof.
Whenever possible this Note and each provision hereof shall be interpreted
in such manner as to be effective, valid and enforceable under applicable law.
Any provisions of this Note which are prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidation the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. In addition, any determination that the application of any
provision hereof to the person or under any circumstance is illegal and
unenforceable shall not affect the legality, validity and enforceability of such
provision as it may be applied to any other person or in any other circumstance.
WAIVER OF JURY TRIAL. THE BORROWER AND LENDER BY ITS ACCEPTANCE HEREOF,
FOR ITSELF AND FOR EACH HOLDER HEREOF, HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY AGREE, THAT:
(A) NEITHER THE BORROWER NOR LENDER, NOR ANY ASSIGNEE, SUCCESSOR, HEIR OR
LEGAL REPRESENTATIVE OF ANY OF THE SAME SHALL SEEK A JURY TRIAL IN ANY LAWSUIT,
PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE ARISING FROM OR
BASED UPON THIS NOTE.
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ANY INSTRUMENT OR ANY LOAN DOCUMENT EVIDENCING, SECURING OR RELATING TO THE
OBLIGATIONS OR TO THE DEALINGS OR RELATIONSHIP BETWEEN OR AMONG THE PARTIES
THERETO;
(B) NEITHER THE BORROWER NOR LENDER SHALL SEEK TO CONSOLIDATE ANY SUCH
ACTION, IN WHICH A JURY TRIAL HAS BEEN WAIVED, WITH ANY OTHER ACTION IN WHICH A
JURY TRIAL HAS NOT BEEN OR CANNOT BE WAIVED;
(C) THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE
BORROWER AND LENDER, AND THESE PROVISIONS SHALL BE SUBJECT TO NO EXCEPTIONS;
(D) NEITHER THE BORROWER NOR LENDER HAS IN ANY WAY AGREED WITH OR
REPRESENTED TO ANY OTHER PARTY THAT THE PROVISIONS OF THIS PARAGRAPH WILL NOT BE
FULLY ENFORCED IN ALL INSTANCES;
(E) IN NO EVENT SHALL LENDER BE RESPONSIBLE OR LIABLE FOR CONSEQUENTIAL OR
PUNITIVE DAMAGES; AND
(F) THIS PROVISION IS A MATERIAL INDUCEMENT FOR LENDER TO ENTER INTO THIS
TRANSACTION AND IS SEPARATELY GIVEN, KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT
OF COMPETENT LEGAL COUNSEL.
[Signatures on next page]
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NOTICE TO THE BORROWER
Do not sign this loan agreement before you read it. This loan agreement
provides for the payment of a penalty if you wish to repay the loan prior to
the date provided for repayment in the loan agreement. In addition, this loan
agreement authorizes the lender to refuse to accept repayment of the loan prior
to the date provided for repayment in the loan agreement unless certain
conditions stated in the loan agreement are met.
MORTON'S OF CHICAGO, INC., an
Illinois corporation
/s/ Phyllis Zucaro By: /s/ Thomas J. Baldwin
- -------------------------------- ----------------------------
Name: Phyllis Zucaro Name: Thomas J. Baldwin
Its: SVP Finance & CFO
/s/ Michael D. Blaymore
- --------------------------------
Name: Michael D. Blaymore
(CORPORATE SEAL)
MORTON'S OF CHICAGO/DENVER,
INC., an Illinois corporation
/s/ Phyllis Zucaro By: /s/ Thomas J. Baldwin
- -------------------------------- ----------------------------
Name: Phyllis Zucaro Name: Thomas J. Baldwin
Its: SVP Finance & CFO
/s/ Michael D. Blaymore
- --------------------------------
Name: Michael D. Blaymore
(CORPORATE SEAL)
MORTON'S OF CHICAGO/CHICAGO,
INC., an Illinois corporation
/s/ Phyllis Zucaro By: /s/ Thomas J. Baldwin
- -------------------------------- ----------------------------
Name: Phyllis Zucaro Name: Thomas J. Baldwin
Its: SVP Finance & CFO
/s/ Michael D. Blaymore
- --------------------------------
Name: Michael D. Blaymore
(CORPORATE SEAL)
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STATE OF New York
COUNTY OF Nassau
BEFORE ME, the undersigned, a Notary Public in and for said County and
State, on this day personally appeared Thomas J. Baldwin, as Senior Vice
President of MORTON'S OF CHICAGO, INC., an Illinois corporation, the corporation
that executed the foregoing instrument, known to me to be the person and officer
whose name is subscribed to the foregoing instrument, and acknowledged to me
that the same was the act of the said corporation, and that he executed the same
as the act of such corporation for the purposes and consideration therein
expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL this 3rd day of March, 1997.
/s/ David Gruber
-----------------------------------------
Notary Public - State of New York
[STAMP]
Print Name: David Gruber
Commission Number:_______________________
Commission Expires: March 30,1999
STATE OF New York
COUNTY OF Nassau
BEFORE ME, the undersigned, a Notary Public in and for said County and
State, on this day personally appeared Thomas J. Baldwin, as Senior Vice
President of MORTON'S OF CHICAGO/DENVER, INC., an Illinois corporation, the
corporation that executed the foregoing instrument, known to me to be the person
and officer whose name is subscribed to the foregoing instrument, and
acknowledged to me that the same was the act of the said corporation, and that
he executed the same as the act of such corporation for the purposes and
consideration therein expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL this 3rd day of March, 1997.
/s/ David Gruber
-----------------------------------------
Notary Public - State of New York
[STAMP]
Print Name: David Gruber
Commission Number:_______________________
Commission Expires: March 30, 1999
10
STATE OF New York
COUNTY OF Nassau
BEFORE ME, the undersigned, a Notary Public in and for said County and
State, on this day personally appeared Thomas J. Baldwin, as Senior Vice
President of MORTON'S OF CHICAGO/CHICAGO, INC., an Illinois corporation, the
corporation that executed the foregoing instrument, known to me to be the person
and officer whose name is subscribed to the foregoing instrument, and
acknowledged to me that the same was the act of the said corporation, and that
he executed the same as the act of such corporation for the purposes and
consideration therein expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL this 3rd day of March, 1997.
/s/ David Gruber
-----------------------------------------
Notary Public - State of New York
[STAMP]
Print Name: David Gruber
Commission Number:_______________________
Commission Expires: March 30, 1999
This instrument was prepared by: Daniel F. McIntosh, Esquire
Lowndes, Drosdick, Doster, Kantor & Reed, P.A.
215 North Eola Drive
Orlando, Florida 32801
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