WELLSFORD REAL PROPERTIES, INC.
PROMISSORY NOTE
FOR VALUE RECEIVED, the undersigned, Wellsford Real Properties, Inc.
("WRP"), a Maryland corporation, HEREBY PROMISES TO PAY on the Expiration Date
to the order of Commerzbank AG, New York Branch, a banking corporation organized
and existing under the laws of The Federal Republic of Germany acting through
its New York Branch (the "Bank"), the unpaid amount of all obligations of WRP to
the Bank pursuant to that certain Letter of Credit Reimbursement Agreement among
WRP, Palomino Park Public Improvements Corporation and the Bank dated as of June
16, 2000 (the "Reimbursement Agreement") and the other Related Documents. WRP
promises to pay interest on the unpaid principal amount of this Promissory Note
from the date hereof until such principal amount is paid in full, at such
interest rates, and payable at such times, as are specified in the Reimbursement
Agreement. (Capitalized terms used in this Promissory Note which are not
otherwise defined herein have the same meaning as provided in the Reimbursement
Agreement.)
Both principal and interest are payable in lawful money of the United
States of America in immediately available funds at the office of the Bank set
forth in the Reimbursement Agreement.
This Promissory Note is one of the Promissory Notes referred to in, and is
entitled to the benefits of, the Reimbursement Agreement and the other Related
Documents. The Reimbursement Agreement, among other things, contains provisions
for acceleration of the maturity hereof upon the happening of certain stated
events and also for optional and mandatory prepayments on account of principal
hereof prior to the maturity hereof upon the terms and conditions therein
specified.
WRP waives presentment, demand, protest or notice of any kind in connection
with this Promissory Note. WRP agrees to pay to the holder hereof, on demand,
all costs and expenses (including legal fees and disbursements) incurred in
connection with the enforcement and collection of this Promissory Note.
This Promissory Note shall be governed by, and construed in accordance
with, the laws of the State of New York.
WELLSFORD REAL PROPERTIES INC.
By: /s/ David M. Strong
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Name: David M. Strong
Title: Vice President
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