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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) August 20, 1998
UNIPROP MANUFACTURED HOUSING COMMUNITIES INCOME FUND II
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(Exact name of registrant as specified in its charter)
Michigan 0-16701 38-2702802
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
280 Daines Street, Suite 300, Birmingham, MI 48009
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (248) 645-9261
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Not Applicable
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(Former name or former address, if changed since last report)
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Item 2. Acquisition or Disposition of Assets.
On August 20, 1998, Uniprop Manufactured Housing Communities Income
Fund II (the "Company") borrowed $30,000,000 (the "Loan") from GMAC Commercial
Mortgage Corporation ("GMACCM"). The Loan carries a fixed interest rate of 6.37%
over its term of 126 months and is amortized over 360 months. The Loan was
secured by mortgages on the Company's Ardmor Village, Camelot Manor, Dutch
Hills, El Adobe, Stonegate Manor, Sunshine Village, and West Valley properties.
The Company will use the proceeds from the Loan to refinance the Company's
outstanding indebtedness of $30,045,000 (the "Existing Indebtedness").
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Item 7. Financial Statements and Exhibits
(b) Pro forma financial information.
The pro forma financial information required by Item 7(b)(1) of
Form 8-K is not included in this initial Report and will be filed
by amendment on or about September 15, 1998, in compliance with
Item 7(b)(2) of Form 8-K.
(c) Exhibits.
2. Mortgage Notes, made as of the 20th day of August, 1998,
between Uniprop Manufactured Housing Communities Income Fund II
and GMACCM.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: September 4, 1998
UNIPROP MANUFACTURED HOUSING
COMMUNITIES INCOME FUND II,
a Michigan Limited Parternership
BY: Genesis Associates Limited Partnership,
General Partner
BY: Uniprop, Inc.,
Its Managing General Partner
By: /s/ Paul M. Zlotoff
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Paul M. Zlotoff, Chairman
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CONSOLIDATED AMENDED AND RESTATED
PROMISSORY NOTE
$25,710,000.00 August 20, 1998
FOR VALUE RECEIVED, and upon the terms and conditions set forth herein,
UNIPROP MANUFACTURED HOUSING COMMUNITIES INCOME FUND II, a Michigan limited
partnership ("Borrower"), promises to pay to the order of GMAC COMMERCIAL
MORTGAGE CORPORATION, a California corporation ("Lender"), at Lender's office
located at 650 Dresher Road, P.O. Box 809, Horsham, Pennsylvania 19044-0809,
Attn: Servicing - Accounting Manager, or at such other place as Lender may
designate in writing from time to time, the principal sum of TWENTY-FIVE MILLION
SEVEN HUNDRED TEN THOUSAND DOLLARS ($25,710,000), or so much thereof as is
outstanding and unpaid, together with interest thereon at the Applicable
Interest Rate (defined below), in lawful money of the United States of America,
which, at the time of payment, shall be legal tender in payment of all debts and
dues, public and private.
1. COMPUTATION OF INTEREST. The term "Applicable Interest Rate" as used in
this Note shall mean (a) from the date hereof through and including the day
immediately prior to the Optional Prepayment Date (defined below), a rate of
interest equal to six and thirty seven one hundredths percent (6.37%) per annum
(the "Initial Interest Rate"), and (b) from the Optional Prepayment Date through
and including the Maturity Date, a rate of interest (the "Adjusted Interest
Rate") equal to two percentage points (2.0%) above the Initial Interest Rate.
Interest under this Note shall be paid in arrears and shall be calculated based
on a 360-day year and paid for the actual number of days elapsed for any whole
or partial month in which interest is being calculated. Interest shall accrue
from the date on which funds are advanced (regardless of the time of day such
advance is made) through and including the day on which funds are repaid, unless
payment is received by Lender prior to the time set forth in Section 2.03
hereof.
2. PAYMENT OF PRINCIPAL AND INTEREST.
2.01 Principal and Interest Payments. Borrower agrees to pay sums under
this Note in installments as follows:
(a) a payment of interest only computed at the Initial Interest Rate on
the date hereof for the period commencing the date hereof and continuing
through and including September 9, 1998;
(b) a constant payment of $161,868.25 on October 10, 1998 and on the tenth
day of each calendar month (each date on which a payment of interest and
principal is due under this Note being hereinafter referred to as a "Payment
Date") thereafter up to and including March 10, 2009 (the "Optional Prepayment
Date"); each of the payments to be applied as follows: (i) first, to the payment
of interest computed at the Initial Interest Rate; and (ii) the balance toward
the reduction of the principal sum;
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(c) On April 10, 2009 and on the tenth day of each calendar month
thereafter up to and including August 10, 2028:
(i) a constant payment of $161,868.25, each of the payments to be
applied as follows: (A) first, to the payment of interest (without adjustment
for Accrued Interest (defined below)) computed at the Initial Interest Rate; and
(B) the balance toward the reduction of the principal balance;
(ii) a payment of an amount equal to the Excess Cash Flow (as defined
in that certain Cash Management Agreement dated as of the date hereof made
between Borrower and Lender (the "Cash Management Agreement")) for the month
immediately preceding each such Payment Date, each of the payments to be applied
as follows: (A) first, toward the reduction of the principal balance; and (B)
the balance toward the interest accrued on the principal balance computed at a
rate of interest equal to the difference between (x) the Adjusted Interest Rate
and (y) the Initial Interest Rate (the "Accrued Interest"); and
(d) the balance of the principal sum and all interest thereon (including,
without limitation, all Accrued Interest) on September 10, 2028 (the "Maturity
Date").
2.02 Accrued Interest. Accrued Interest not paid pursuant to paragraph
(c)(ii) of Section 2.01 above shall be deferred and added to the indebtedness
secured by this Note and shall earn interest at the Adjusted Interest Rate, to
the extent permitted by applicable law.
2.03 Method of Payment. Each payment due hereunder shall not be deemed
received by Lender until received on a Business Day (defined below) in federal
funds immediately available to Lender prior to 2:00 p.m. local time at the place
then designated by Lender. Any payment received on a Business Day after the time
established by the preceding sentence shall be deemed to have been received on
the immediately following Business Day for all purposes, including, without
limitation, the accrual of interest on principal.
2.04 Application of Payments. Payments under this Note shall be applied
first to the payment of late fees and other costs and charges due in connection
with this Note, then to the payment of accrued but unpaid interest (except as
provided in Section 2.01(c) above), and then to the reduction of the
outstanding principal balance (in inverse order of maturity whether or not then
due), but such application shall not reduce the amount of the fixed monthly
installments required to be paid hereunder. No principal amount repaid may be
reborrowed. All amounts due under this Note shall be payable without setoff,
counterclaim or any other deduction whatsoever.
3. LOAN REPAYMENT.
3.01 Voluntary Repayment. Borrower shall have no right to prepay all or any
portion of the principal balance of this Note during the period commencing on
the date hereof through, but not including, the date which is nine (9) months
prior to the Optional Prepayment Date (the "Prepayment Lock-Out Termination
Date"). From and after the Prepayment Lock-Out Termination Date, the principal
balance of this Note may be prepaid in whole but not in part, without penalty or
premium,
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on any Payment Date, together with (i) all accrued and unpaid interest to and
including the Prepayment Date (defined below); (ii) payment of all Accrued
Interest, if any, and all accrued interest thereon to and including the
Prepayment Date, and (iii) payment of all other sums then due under this Note
and the Other Security Documents (defined below). Any such prepayment shall be
subject, in each case, to the satisfaction of the condition precedent that
Borrower shall provide not less than ten (10) Business Days prior written notice
to Lender specifying the Payment Date on which such prepayment is to occur (the
"Prepayment Date"). The principal balance of this Note may be prepaid, in whole
or in part, without penalty or premium, in connection with a prepayment
resulting from the application of insurance proceeds or condemnation awards
pursuant to the terms of the Security Instrument (defined below).
3.02 Repayment Upon Default. If all or any part of the principal
amount of this Note is prepaid upon acceleration of this Note following the
occurrence of an Event of Default (defined below) prior to the Prepayment
Lock-Out Termination Date, then, in addition to such principal payment,
Borrower shall be required to make such payments ("Yield Maintenance Payments")
in an amount equal to the greater of (i) one percent (1%) of the principal
amount being prepaid, or (ii) the excess, if any, of (A) the aggregate
respective present values of all scheduled interest and principal payments
payable on each Payment Date in respect of this Note for the period from the
date of such prepayment upon acceleration to the Prepayment Lock-Out Termination
Date (including the principal balance scheduled to be outstanding on the
Prepayment Lock-Out Termination Date), discounted monthly at a rate equal to the
Treasury Constant Maturity Yield Index (defined below) and based on a 360-day
year of twelve 30-day months over (B) the then current outstanding principal
amount of this Note. For purposes of this Subsection 3.02, "Treasury Constant
Maturity Yield Index" shall mean the average yield for "This Week" as reported
by the Federal Reserve Board in Federal Reserve Statistical Release H.15(519)
("FRB Release") published during the second full week preceding the Prepayment
Date for instruments having a maturity coterminous with the Prepayment Lock-Out
Termination Date. In the event the FRB Release is no longer published, Lender
shall select a comparable publication to determine the Treasury Constant
Maturity Yield Index. If there is no Treasury Constant Maturity Yield Index for
instruments having a maturity coterminous with the remaining term of this Note,
then the weighted average yield to maturity of the Treasury Constant Maturity
Yield Indices with maturities next longer and shorter than such remaining
average life to maturity shall be used, calculated by averaging (and rounding
upward to the nearest whole multiple of 1/100 of 1% per annum, if the average
is not such a multiple) the yields of the relevant Treasury Constant Maturity
Yield Indices (rounded, if necessary, to the nearest 1/100 of 1% with any
figure of 1/200 of 1% or above rounded upward). The Yield Maintenance Payments
to be paid in connection with any prepayment under this Section 3.02 shall be
determined by Lender and shall be conclusive and binding on Borrower (absent
manifest error). For purposes of this Section 3.02, the unpaid principal amount
due on this Note on the date of prepayment and on the Prepayment Lock-Out
Termination Date shall be determined after giving effect to any payment of
scheduled amortization made on such date.
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3.03 Defeasance.
(a) Borrower shall have the right to defease all or a portion of the
indebtedness evidenced by this Note pursuant to the terms and conditions set
forth in Section 4 of that certain Loan Agreement between Borrower and Lender
dated the date hereof.
4. SECURITY; LOAN DOCUMENTS. The indebtedness evidenced by this Note and the
obligations created hereby (including without limitation the amounts authorized
by Section 5 below to be collected by Lender and the Yield Maintenance Payments
when due hereunder) are secured by, among other things, those certain first
mortgages, deeds of trust or deeds to secure debt, as applicable, from Borrower
to Lender dated as of the date hereof (the "Security Instruments") covering
certain real and personal property collateral of Borrower, tangible and
intangible, as described more particularly in the Security Instruments
(collectively, the "Property"). The term "Other Security Documents" as used in
this Note shall mean all and any of the documents other than this Note now or
hereafter executed by Borrower and/or others and by or in favor of Lender, which
wholly or partially secure or guarantee payment of this Note.
5. DEFAULT.
5.01 Event of Default. The occurrence of any of the following shall
constitute an event of default ("Event of Default") under this Note: (a) if any
payment of principal and interest or any other payment required under this Note
is not received by Lender on the date such payment is due; or (b) if any default
should occur under any of the Other Security Documents which is not fully cured
following applicable notice and prior to the expiration of any applicable grace
or cure period. Upon the occurrence of an Event of Default, at Lender's option,
the outstanding principal balance of this Note, together with all unpaid
interest accrued thereon and all other sums dues hereunder or under any other of
the Other Security Documents, shall, without notice or prior demand, immediately
become due and payable.
5.02 Late Charges. If any payment is not received by Lender on or before
the date on which such payment originally was due (as such due date may be
extended by applicable grace period, if any), then, in addition to any default
interest payments due hereunder, Borrower also shall pay to Lender a late charge
in an amount equal to five percent (5.0%) of the amount of such overdue payment
to defray the expenses incurred by Lender in handling and processing such
delinquent payment and to compensate Lender for the loss of the use of the
delinquent payment. Such late charge shall be immediately due and payable,
without notice or demand therefor.
5.03 Default Rate. If this Note is not paid in full on or before the
Maturity Date or the date on which the due date of the indebtedness has been
accelerated pursuant to the provisions hereof, the unpaid principal and accrued
interest and other amounts then due shall bear interest at a rate per annum
("Default Rate") equal to the lesser of (a) five percent (5.0%) in excess of the
Initial Interest Rate or (b) the maximum rate of interest, if any, which may be
charged or collected from Borrower under applicable law. In addition, Lender
shall have the right, without acceleration of the indebtedness, to collect
interest at the Default Rate on any payment due hereunder or under any of
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the Other Security Documents (including, without limitation, late charges and
fees for legal counsel) which is not received by Lender on or before the date on
which such payment originally was due (as such due date may be extended by
applicable grace period, if any). Interest at the Default Rate shall be
immediately due and payable from the due date specified herein or therein and
shall accrue until all Events of Default have been fully cured or full payment
is received, as applicable.
5.04 Interest on Judgments. Interest shall accrue on any judgment obtained
by Lender in connection with the enforcement or collection of this Note until
such judgment amount is paid in full at a rate equal to the greater of (a) the
Default Rate or (b) the legal rate applicable to judgments within such
jurisdiction; provided, however, that interest shall not accrue at a rate in
excess of the maximum rate of interest, if any, which may be charged or
collected from Borrower under applicable law.
5.05 Cumulative Remedies, Attorney Fees. The remedies of Lender in this
Note and in the Other Security Documents, or at law or in equity, shall be
cumulative and concurrent, and may be pursued singly, successively or together
in Lender's sole discretion and as often as occasion therefor shall arise. If
Borrower's obligations under this Note or any of the Other Security Documents
are enforced by Lender through an attorney at law, or any payment due under this
Note or the Other Security Documents is collected by or through an
attorney-at-law or collection agency, Borrower agrees to pay all costs incurred
by Lender in connection therewith, including, but not limited to, reasonable
fees and disbursements of legal counsel (whether with respect to a retained firm
or Lender's in-house staff) and collection agency costs, whether or not suit be
brought. No provision of this Section 5 shall be construed as an agreement or
privilege to extend the date on which any required payment is due (subject to
the applicable grace period, if any), nor as a waiver of any other right or
remedy accruing to Lender by reason of the occurrence of an Event of Default.
The payments required under this Section 5 shall be in addition to, and shall in
no way limit, any other rights and remedies provided for in this Note or any of
the Other Security Documents, nor any other remedies provided by law or in
equity, and shall be added to the principal evidenced by this Note and deemed
secured by the Security Instrument and Other Security Documents.
6. LIMITATIONS ON RECOURSE.
6.01 Exculpation. Notwithstanding anything to the contrary contained in
this Note or in any Other Security Document (but subject to the provisions of
Sections 6.02, 6.03, 6.04 and 6.05), Lender shall not enforce the liability and
obligation of Borrower to perform and observe the obligations contained in this
Note, the Security Instrument or the Other Security Documents by any action or
proceeding to collect damages or wherein a money judgment or any deficiency
judgment or order or any judgment establishing any personal obligation or
liability shall be sought against Borrower or any principal, director, officer,
employee, beneficiary, shareholder, partner, member, trustee, agent or affiliate
of Borrower or any person owning, directly or indirectly, any legal or
beneficial interest in Borrower, or any successors or assigns of any of the
foregoing (collectively, the "Exculpated Parties"). Lender, may bring a
foreclosure action, action for specific performance or other appropriate action
or proceeding to enable Lender to enforce and realize upon the Security
Instrument, the Other Security Documents, and the interest in the Property, the
Rents (as defined in the Security Instrument) and any other collateral given to
Lender created by the Security Instrument
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and the Other Security Documents; provided, however, subject to the provisions
of Sections 6.02, 6.03, 6.04 and 6.05, that any judgment in any action or
proceeding shall be enforceable against Borrower only to the extent of
Borrower's interest in the Property, in the Rents and in any other collateral
given to Lender in connection with this Note. Lender, by accepting this Note and
the Security Instrument, agrees that it shall not, except as otherwise provided
below, sue for or demand any deficiency judgment against Borrower or any of the
Exculpated Parties in any action or proceeding, under or by reason of or under
or in connection with this Note, the Other Security Documents or the Security
Instrument.
6.02 Reservation of Certain Rights. The provisions of Section 6.01 shall
not (a) constitute a waiver, release or impairment of the Obligations (as
defined in the Security Instrument); (b) impair the right of Lender to name
Borrower as a party defendant in any action or suit for judicial foreclosure and
sale under the Security Instrument; (c) affect the validity or enforceability of
any indemnity, guaranty, master lease or similar instrument made in connection
with this Note, the Security Instrument, or the Other Security Documents; (d)
impair the right of Lender to obtain the appointment of a receiver; or (e)
impair the enforcement of the Assignment of Leases and Rents executed in
connection herewith.
6.03 Exceptions to Exculpation. Notwithstanding the provisions of Section
6.01 to the contrary, Borrower (but not its general partner or the general
partners of its general partner) shall be personally liable to Lender for (a)
the Losses (as defined in the Security Instrument) Lender incurs due to: (i)
fraud or intentional material misrepresentation by Borrower or any other person
or entity acting on behalf of Borrower in connection with the execution and the
delivery of this Note, the Security Instrument or the Other Security Documents;
(ii) Borrower's misapplication or misappropriation of Rents received by Borrower
after the occurrence and during the continuance of an Event of Default; (iii)
Borrower's misapplication or misappropriation of tenant security deposits or
Rents collected more than one (1) month in advance; (iv) the misapplication or
misappropriation of insurance proceeds or condemnation awards after the
occurrence and during the continuance of an Event of Default; (v) gross
negligence, or criminal acts perpetrated by it resulting in forfeiture, seizure
or loss of any portion of the Property; (vi) any failure by Borrower to comply
with the terms and provisions of the Environmental Indemnity (as defined in the
Security Instrument); (vii) any failure by Borrower to comply with the terms and
provisions of Section 4.3 of the Security Instrument; or (viii) any sale,
conveyance, mortgage, grant, bargain, encumbrance, pledge, assignment or
transfer of the Property or any part thereof, within the meaning of Article 8 of
the Security Instrument, without the prior written consent of Lender if such
consent was required, and (b) the payment of any monetary penalty imposed
pursuant to Section 3.11(d) of the Security Instrument.
6.04 Recourse. Notwithstanding the foregoing, the agreement of Lender not
to pursue recourse liability as set forth in Section 6.01 above SHALL BECOME
NULL AND VOID and shall be of no further force and effect with respect to
Uniprop, Inc. and personal liability may be sought against the Uniprop, Inc. in
the event the Property or any part thereof shall become an asset in (A) a
voluntary bankruptcy or insolvency proceeding filed by Borrower or the general
partner of Borrower, or (B) an involuntary bankruptcy or insolvency proceeding
commenced against Borrower or the general partner of Borrower by any Person
(other than Lender) which is not dismissed within
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90 days of the filing thereof. From and after the SPE Date (as defined in the
Security Instruments), this Section 6.04 shall be of no further force or effect.
6.05 Bankruptcy Claims. Nothing herein shall be deemed to be a waiver of
any right which Lender may have under Sections 506(a), 506(b), 1111(b) or
any other provisions of the U.S. Bankruptcy Code to file a claim for the full
amount of the Debt secured by the Security Instrument or to require that all
collateral shall continue to secure all of the Debt owing to Lender in
accordance with this Note, the Security Instrument and the Other Security
Documents.
7. NO USURY. This Note is subject to the express condition that at no time
shall Borrower be required or obligated to pay interest (or any other amount
agreed to be paid hereunder which shall be deemed to be interest) at a rate
which would subject Lender to either civil or criminal liability as a result of
being in excess of the maximum interest rate which are permitted by applicable
law to pay. If, from any circumstance whatsoever, Borrower is at any time
required or obligated to pay interest (or any other amount agreed to be paid
hereunder which shall be deemed to be interest) at a rate in excess of such
maximum rate, then the amount to be paid immediately shall be reduced to such
maximum rate, and, as required by applicable law, all previous payments in
excess of such maximum shall be deemed to have been payments in reduction of the
principal balance owing under this Note in the inverse order of maturity
(whether or not then due) or, at the option of Lender, be paid over to Borrower
and not to the payment of interest. All sums paid or agreed to be paid to Lender
for the use, forbearance or detention of the indebtedness evidenced hereby
shall, to the extent permitted by applicable law, be amortized, prorated,
allocated and spread throughout the full stated term of this Note until payment
in full so that the rate or amount of interest on account of said indebtedness
does not exceed the maximum lawful rate of interest from time to time in effect
and applicable to this Note for so long as the Note is outstanding. This Section
will control all agreements between Borrower and Lender in connection with this
Note.
8. GENERAL CONDITIONS.
8.01 No Waiver by Lender. No failure to accelerate the debt evidenced
hereby nor failure or delay in exercising any other right or remedy upon the
occurrence of an Event of Default hereunder, or any acceptance of a partial or
past due payment, or indulgences granted from time to time shall be construed
(a) as a novation of this Note or as a reinstatement of the indebtedness
evidenced hereby, (b) as a waiver or impairment of Lender's right of
acceleration or any other right or remedy available to Lender upon the
occurrence of an Event of Default, or (c) as a waiver of Lender's right
thereafter to insist upon strict compliance with the terms of this Note or
any of the Other Security Documents; and Borrower hereby expressly waives the
benefit of any statute or rule of law or equity now provided, or which may
hereafter be provided, which would produce a result contrary to or in conflict
with the foregoing. No extension of the time for payment of any amount due under
this Note or under any of the Other Security Documents made by Lender's
agreement with any person now or hereafter liable for the payment thereof shall
operate to release, discharge, modify, change or affect the original liability
of Borrower under this Note or any such other person, either in whole or in part
unless Lender agrees otherwise in writing.
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8.02 Borrower's Waivers. Borrower, for itself and all others who may become
liable for payment of all or any part of the indebtedness evidenced by this
Note, hereby waives presentment for payment, demand, protest, and notice of
dishonor, nonpayment, intent to accelerate, and acceleration. Borrower, for
itself and all others who may become liable for payment of all or any part of
the indebtedness evidenced by this Note, hereby further waives and renounces,
to the fullest extent permitted by law, all rights to the benefits of any
moratorium, reinstatement, marshalling, forbearance, valuation, stay, extension,
redemption, appraisement, exemption and homestead now or hereafter provided by
the Constitution and laws of the United States of America and of each state
thereof, both as to party and property (real and personal), against the
enforcement and collection of the obligations evidenced by this Note or the
Other Security Documents.
8.03 Unconditional Payment. If any payment received by Lender hereunder
shall be deemed by a court of competent jurisdiction to have been a voidable
preference or fraudulent conveyance under any bankruptcy, insolvency or other
debtor relief law, then the obligation to make such payment shall survive any
cancellation or satisfaction of this Note or return thereof to Borrower and
shall not be discharged or satisfied with any prior payment thereof or
cancellation of this Note, but shall remain a valid and binding obligation
enforceable in accordance with the terms and provisions hereof, and such payment
shall be immediately due and payable upon demand. No release of any security for
this Note or any party liable for payment of this Note shall release or affect
the liability of Borrower or any other party who may become liable for payment
of all or any part of the indebtedness evidenced by this Note. Lender may
release any guarantor, surety or indemnitor of this Note from liability, in
every instance without the consent of Borrower hereunder and without waiving any
rights which Lender may have hereunder or under any of the Other Security
Documents or under applicable law or in equity.
8.04 Intentionally Omitted.
8.05 Negotiable Instrument. Borrower agrees that this Note shall be deemed
a negotiable instrument, even though this Note, absent this paragraph, may not
otherwise qualify as a negotiable instrument under applicable law.
8.06 Sale by Lender. Lender shall have the right to transfer, sell or
assign this Note, the Security Instrument and the Other Security Documents, and
the obligations hereunder and thereunder.
9. MISCELLANEOUS.
9.01 Notices. All notices and other communications under this Note or under
the Other Security Documents are to be in writing, addressed to the respective
party as set forth in this section, and shall be deemed to have been duly given
(a) upon delivery, if delivered in person with receipt acknowledged by the
recipient thereof, (b) one (1) Business Day after having been deposited for
overnight delivery, fee prepaid, with any reputable overnight courier service,
or (c) three (3) Business Days after having been deposited in any post office or
mail depository regularly maintained by the U.S. Postal Service and sent by
registered or certified mail, postage prepaid, return receipt requested. Initial
addresses for each party are as follows:
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Borrower:
UNIPROP MANUFACTURED HOUSING
COMMUNITIES INCOME FUND II
280 Daines Street, Suite 300
Birmingham, Michigan 48009
Attention: Paul M. Zlotoff
Facsimile No.: (248) 645-2154
with a copy to:
Jaffe, Raitt, Heuer & Weiss
Suite 2400
One Woodward Avenue
Detroit, Michigan 48226
Attention: Arthur Weiss, Esq.
Facsimile No.: (313) 961-8358
Lender:
GMAC Commercial Mortgage Corporation
650 Dresher Road
P.O. Box 1015
Horsham, Pennsylvania 19044-8015
Attention: Servicing - Executive Vice President
Facsimile No.: (215) 328-3478
and
Commercial Capital Initiatives, Inc.
Wall Street Plaza
88 Pine Street
New York, New York 10005
Attention: Manager - Loan Administration
Facsimile: (212) 269-5286
with a copy to:
Thacher Proffitt & Wood
Two World Trade Center
New York, New York 10048
Attention: Mitchell G. Williams, Esq.
Facsimile No.: (212) 912-7751
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Each party may establish a new address from time to time by written notice to
the other given in accordance with this section; provided, however, that no such
change of address will be effective until written notice thereof is actually
received by the party to whom such change of address is sent. Notice to
additional parties now or hereafter designated by a party entitled to notice are
for convenience only and are not required for notice to a party to be effective
in accordance with this section. For purposes of this subsection, "Business Day"
shall mean a day on which commercial banks are not authorized or required by law
to close in the State of New York.
9.02 Entire Agreement; Time of Essence. This Note, together with the
Other Security Documents and Lender's commitment letter to Borrower, contain the
entire agreements between Borrower and Lender relating to the subject matter
hereof and thereof, and supersede all prior discussions and agreements (oral or
written) relative hereto and thereto which are not contained herein or therein.
Borrower represents and warrants that it is not relying on any promises,
covenants, representations or agreements in connection with this Note or the
Other Security Documents, other than as expressly set forth herein or therein.
In the event of any conflict between the terms of this Note and the Other
Security Documents, the following order of priority shall be used to resolve
such conflict: The Note shall control over the Security Instruments and the
Security Instruments shall control over all Other Security Documents. Time is of
the essence with respect to all provisions of this Note.
9.03 Modification. Neither this Note nor any of the Other Security
Documents may be changed, waived, supplemented, discharged or terminated orally
or by any act or failure to act on the part of Borrower or Lender, but only by
an agreement in writing signed by the party against whom enforcement thereof is
sought and then only to the extent expressly set forth in such writing. No
person other than a duly authorized officer or agent of Lender shall be deemed
an agent of Lender nor have any authority to waive, modify, supplement or
terminate in any manner whatsoever any of the terms of this Note.
9.04 Binding Effect; Joint and Several Obligations. The terms and
provisions of this Note and the Other Security Documents shall be binding upon
and inure to the benefit of Borrower and Lender and their respective heirs,
executors, legal representatives, successors, successors and assigns, whether by
voluntary action of the parties or by operation of law. The foregoing shall not
be construed, however, to alter any limitations or restrictions applicable to
the Borrower under the Other Security Documents. If Borrower consists of more
than one person or party, the obligations and liabilities under this Note and
the Other Security Documents of each person or party shall be joint and several.
9.05 Unenforceable Provisions. Any provision of this Note or the Other
Security Documents which may be determined by competent authority to be
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective only to the extent of such prohibition or unenforceability
without invalidating 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.
10
<PAGE> 15
9.06 Ambiguity and Construction of Certain Terms. Neither this Note
nor any uncertainty or ambiguity herein shall be construed or resolved against
Lender by virtue of the fact that such document has originated with Lender as
drafter. Borrower acknowledges that it has reviewed this Note and has had the
opportunity to consult with counsel on same. This Note, therefore, shall be
construed and interpreted according to the ordinary meaning of the words used so
as to fairly accomplish the purposes and intentions of the parties hereto. All
personal pronouns used herein, whether used in the masculine, feminine or neuter
gender, shall be deemed to include all other genders; the singular shall include
the plural and vice versa. Titles of articles and sections are for convenience
only and in no way define, limit, amplify or describe the scope or intent of any
provisions hereof. "Herein," "hereof" and "hereunder" and other words of similar
import refer to this Note as a whole and not to any particular section,
paragraph or other subdivision; "Section" refers to the entire section and not
to any particular subsection, paragraph of other subdivision. Reference to days
for performance shall mean calendar days unless Business Days are expressly
indicated.
9.07 Governing Law. This Note shall be interpreted, construed and
enforced according to the laws of the state of New York.
9.08 Consent to Jurisdiction. Borrower and Lender, by its acceptance of
this Note, agree and consent to the exclusive jurisdiction and venue of any
state or federal court sitting in the county and state where the real property
encumbered by the Security Instrument is located with respect to any legal
action, proceeding, or controversy between them and hereby expressly waive any
and all rights under applicable law or in equity to object to the jurisdiction
and venue of said courts. Borrower further irrevocably consents to service of
process by certified mail, return receipt requested, to Borrower at the address
for Borrower last provided to Lender in accordance with the notice provision of
this Note and agrees that such service shall be effective ten (10) days after
mailing. Nothing herein shall, however, preclude or prevent Lender from bringing
any one or more actions against Borrower in any other jurisdiction as may be
necessary to enforce or realize upon the security or other collateral provided
for this Note.
9.09 WAIVER OF JURY TRIAL. BORROWER HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY RIGHT BORROWER MAY HAVE TO TRIAL BY JURY IN ANY
LEGAL ACTION, PROCEEDING, OR COUNTERCLAIM, WHETHER IN CONTRACT, TORT OR
OTHERWISE, RELATING DIRECTLY OR INDIRECTLY TO THE INDEBTEDNESS EVIDENCED BY THIS
NOTE; THE APPLICATION OR COMMITMENT FOR THE LOAN EVIDENCED BY THIS NOTE; THE
INTERPRETATION, CONSTRUCTION, VALIDITY, ENFORCEMENT OR PERFORMANCE OF THIS NOTE
OR ANY OF THE OTHER SECURITY DOCUMENTS; OR ANY ACTS OR OMISSION OF LENDER, ITS
OFFICERS, EMPLOYEES, DIRECTORS OR AGENTS IN CONNECTION WITH ANY OF THE
FOREGOING.
9.10 Tax Identification Number. Borrower represents and warrants that
its current tax identification number is 38-2702802.
11
<PAGE> 16
This Note consolidates amends, restates and replaces those certain
notes described on Schedule 1 attached hereto.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
12
<PAGE> 17
IN WITNESS WHEREOF, Borrower has executed this Note under seal as of
the date first above written.
BORROWER:
UNIPROP MANUFACTURED HOUSING
COMMUNITIES INCOME FUND II, a
Michigan limited partnership
By: GENESIS ASSOCIATES LIMITED
PARTNERSHIP, a Michigan
limited partnership, its
general partner
By: UNIPROP, INC., a Michigan
corporation, its general
partner
By: Gloria A. Koster
---------------------
Name: Gloria A. Koster
Title: Vice President
PAY TO THE ORDER OF ___________________________________, WITHOUT RECOURSE.
GMAC COMMERCIAL MORTGAGE
CORPORATION
By:
----------------------------
Name:
Title:
<PAGE> 18
Schedule 1
1. Mortgage Note dated as of December 1, 1993 in the amount of $8,210,000 made
by Borrower to Neutron-Uniprop, Inc., as assigned to Union Bank, as
trustee.
2. Mortgage Note dated as of December 1, 1993 in the amount of $2,930,000
made by Borrower to Neutron-Uniprop, Inc., as assigned to Union Bank, as
trustee.
3. Mortgage Note dated as of December 1, 1993 in the amount of $5,530,000
made by Borrower to Neutron-Uniprop, Inc., as assigned to Union Bank, as
trustee.
4. Mortgage Note dated as of December 1, 1993 in the amount of $2,580,000
made by Borrower to Neutron-Uniprop, Inc., as assigned to Union Bank, as
trustee.
5. Mortgage Note dated as of December 1, 1993 in the amount of $3,490,000
made by Borrower to Neutron-Uniprop, Inc., as assigned to Union Bank, as
trustee.
6. Mortgage Note dated as of December 1, 1993 in the amount of $3,015,000
made by Borrower to Neutron-Uniprop, Inc., as assigned to Union Bank, as
trustee.
<PAGE> 19
RENEWAL NOTE
$4,290,000.00 August 20, 1998
FOR VALUE RECEIVED, and upon the terms and conditions set forth herein,
UNIPROP MANUFACTURED HOUSING COMMUNITIES INCOME FUND II, a Michigan limited
partnership ("Borrower"), promises to pay to the order of GMAC COMMERCIAL
MORTGAGE CORPORATION, A California corporation ("Lender"), at Lender's office
located at 650 Dresher Road, P.O. Box 809, Horsham, Pennsylvania 19044-0809,
Attn: Servicing - Accounting Manager, or at such other place as Lender may
designate in writing from time to time, the principal sum of FOUR MILLION TWO
HUNDRED NINETY THOUSAND and 00/100 DOLLARS ($4,290,000.00), or so much thereof
as is outstanding and unpaid, together with interest thereon at the Applicable
Interest Rate (defined below), in lawful money of the United States of America,
which, at the time of payment, shall be legal tender in payment of all debts and
dues, public and private.
1. COMPUTATION OF INTEREST. The term "Applicable Interest Rate" as used in this
Note shall mean (a) from the date hereof through and including the day
immediately prior to the Optional Prepayment Date (defined below), a rate of
interest equal to six and thirty seven one hundredths percent (6.37%) per annum
(the "Initial Interest Rate"), and (b) from the Optional Prepayment Date through
and including the Maturity Date, a rate of interest (the "Adjusted Interest
Rate") equal to two percentage points (2.0%) above the Initial Interest Rate.
Interest under this Note shall be paid in arrears and shall be calculated based
on a 360-day year and paid for the actual number of days elapsed for any whole
or partial month in which interest is being calculated. Interest shall accrue
from the date on which funds are advanced (regardless of the time of day such
advance is made) through and including the day on which funds are repaid, unless
payment is received by Lender prior to the time set forth in Section 2.03
hereof.
2. PAYMENT OF PRINCIPAL AND INTEREST.
2.01 Principal and Interest Payments. Borrower agrees to pay sums under this
Note in installments as follows:
(a) a payment of interest only computed at the Initial Interest Rate on the
date hereof for the period commencing the date hereof and continuing through and
including September 9, 1998;
(b) a constant payment of $27,009.52 on October 10, 1998 and on the tenth
day of each calendar month (each date on which a payment of interest and
principal is due under this Note being hereinafter referred to as a "Payment
Date") thereafter up to and including March 10, 2009 (the "Optional Prepayment
Date"); each of the payments to be applied as follows: (i) first, to the payment
of interest computed at the Initial Interest Rate; and (ii) the balance toward
the reduction of the principal sum;
<PAGE> 20
(c) On April 10, 2009 and on the tenth day of each calendar month
thereafter up to and including August 10, 2028:
(i) a constant payment of $27,009.52, each of the payments to
be applied as follows: (A) first, to the payment of interest (without adjustment
for Accrued Interest (defined below)) computed at the Initial Interest Rate; and
(B) the balance toward the reduction of the principal balance;
(ii) a payment of an amount equal to the Excess Cash Flow (as defined
in that certain Cash Management Agreement dated as of the date hereof made
between Borrower and Lender (the "Cash Management Agreement")) for the month
immediately preceding each such Payment Date, each of the payments to be applied
as follows: (A) first, toward the reduction of the principal balance; and (B)
the balance toward the interest accrued on the principal balance computed at a
rate of interest equal to the difference between (x) the Adjusted Interest Rate
and (y) the Initial Interest Rate (the "Accrued Interest"); and
(d) the balance of the principal sum and all interest thereon (including,
without limitation, all Accrued Interest) on September 10, 2028 (the "Maturity
Date").
2.02 Accrued Interest. Accrued Interest not paid pursuant to paragraph
(c)(ii) of Section 2.01 above shall be deferred and added to the indebtedness
secured by this Note and shall earn interest at the Adjusted Interest Rate, to
the extent permitted by applicable law.
2.03 Method of Payment. Each payment due hereunder shall not be deemed
received by Lender until received on a Business Day (defined below) in federal
funds immediately available to Lender prior to 2:00 p.m. local time at the
place then designated by Lender. Any payment received on a Business Day after
the time established by the preceding sentence shall be deemed to have been
received on the immediately following Business Day for all purposes, including,
without limitation, the accrual of interest on principal.
2.04 Application of Payments. Payments under this Note shall be applied
first to the payment of late fees and other costs and charges due in connection
with this Note, then to the payment of accrued but unpaid interest (except as
provided in Section 2.01(c) above), and then to the reduction of the
outstanding principal balance (in inverse order of maturity whether or not then
due), but such application shall not reduce the amount of the fixed monthly
installments required to be paid hereunder. No principal amount repaid may be
reborrowed. All amounts due under this Note shall be payable without setoff,
counterclaim or any other deduction whatsoever.
3. LOAN REPAYMENT.
3.01 Voluntary Repayment. Borrower shall have no right to prepay all or any
portion of the principal balance of this Note during the period commencing on
the date hereof through, but not including, the date which is nine (9) months
prior to the Optional Prepayment Date (the "Prepayment Lock-Out Termination
Date"). From and after the Prepayment Lock-Out Termination Date, the principal
balance of this Note may be prepaid in whole but not in part, without penalty or
premium,
2
<PAGE> 21
on any Payment Date, together with (i) all accrued and unpaid interest to and
including the Prepayment Date (defined below); (ii) payment of all Accrued
Interest, if any, and all accrued interest thereon to and including the
Prepayment Date, and (iii) payment of all other sums then due under this Note
and the Other Security Documents (defined below). Any such prepayment shall be
subject, in each case, to the satisfaction of the condition precedent that
Borrower shall provide not less than ten (10) Business Days prior written notice
to Lender specifying the Payment Date on which such prepayment is to occur (the
"Prepayment Date"). The principal balance of this Note may be prepaid, in whole
or in part, without penalty or premium, in connection with a prepayment
resulting from the application of insurance proceeds or condemnation awards
pursuant to the terms of the Security Instrument (defined below).
3.02 Repayment Upon Default. If all or any part of the principal amount of
this Note is prepaid upon acceleration of this Note following the occurrence of
an Event of Default (defined below) prior to the Prepayment Lock-Out Termination
Date, then, in addition to such principal payment, Borrower shall be required to
make such payments ("Yield Maintenance Payments") in an amount equal to the
greater of (i) one percent (1%) of the principal amount being prepaid, or (ii)
the excess, if any, of (A) the aggregate respective present values of all
scheduled interest and principal payments payable on each Payment Date in
respect of this Note for the period from the date of such prepayment upon
acceleration to the Prepayment Lock-Out Termination Date (including the
principal balance scheduled to be outstanding on the Prepayment Lock-Out
Termination Date), discounted monthly at a rate equal to the Treasury Constant
Maturity Yield Index (defined below) and based on a 360-day year of twelve
30-day months over (B) the then current outstanding principal amount of this
Note. For purposes of this Subsection 3.02, "Treasury Constant Maturity Yield
Index" shall mean the average yield for "This Week" as reported by the Federal
Reserve Board in Federal Reserve Statistical Release H.15(519) ("FRB Release")
published during the second full week preceding the Prepayment Date for
instruments having a maturity coterminous with the Prepayment Lock-Out
Termination Date. In the event the FRB Release is no longer published, Lender
shall select a comparable publication to determine the Treasury Constant
Maturity Yield Index. If there is no Treasury Constant Maturity Yield Index for
instruments having a maturity coterminous with the remaining term of this Note,
then the weighted average yield to maturity of the Treasury Constant Maturity
Yield Indices with maturities next longer and shorter than such remaining
average life to maturity shall be used, calculated by averaging (and rounding
upward to the nearest whole multiple of 1/100 of 1% per annum, if the average
is not such a multiple) the yields of the relevant Treasury Constant Maturity
Yield Indices (rounded, if necessary, to the nearest 1/100 of 1% with any
figure of 1/200 of 1% or above rounded upward). The Yield Maintenance Payments
to be paid in connection with any prepayment under this Section 3.02 shall be
determined by Lender and shall be conclusive and binding on Borrower (absent
manifest error). For purposes of this Section 3.02, the unpaid principal amount
due on this Note on the date of prepayment and on the Prepayment Lock-Out
Termination Date shall be determined after giving effect to any payment of
scheduled amortization made on such date.
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<PAGE> 22
3.03 Defeasance.
(a) Borrower shall have the right to defease all or a portion of the
indebtedness evidenced by this Note pursuant to the terms and conditions set
forth in Section 4 of that certain Loan Agreement between Borrower and Lender
dated the date hereof.
4. SECURITY; LOAN DOCUMENTS. The indebtedness evidenced by this Note and the
obligations created hereby (including without limitation the amounts authorized
by Section 5 below to be collected by Lender and the Yield Maintenance Payments
when due hereunder) are secured by, among other things, those certain first
mortgages, deeds of trust or deeds to secure debt, as applicable, from Borrower
to Lender dated as of the date hereof (the "Security Instruments") covering
certain real and personal property collateral of Borrower, tangible and
intangible, as described more particularly in the Security Instruments
(collectively, the "Property"). The term "Other Security Documents" as used in
this Note shall mean all and any of the documents other than this Note now or
hereafter executed by Borrower and/or others and by or in favor of Lender, which
wholly or partially secure or guarantee payment of this Note.
5. DEFAULT.
5.01 Event of Default. The occurrence of any of the following shall
constitute an event of default ("Event of Default") under this Note: (a) if any
payment of principal and interest or any other payment required under this Note
is not received by Lender on the date such payment is due; or (b) if any default
should occur under any of the Other Security Documents which is not fully cured
following applicable notice and prior to the expiration of any applicable grace
or cure period. Upon the occurrence of an Event of Default, at Lender's option,
the outstanding principal balance of this Note, together with all unpaid
interest accrued thereon and all other sums dues hereunder or under any other of
the Other Security Documents, shall, without notice or prior demand, immediately
become due and payable.
5.02 Late Charges. If any payment is not received by Lender on or before
the date on which such payment originally was due (as such due date may be
extended by applicable grace period, if any), then, in addition to any default
interest payments due hereunder, Borrower also shall pay to Lender a late charge
in an amount equal to five percent (5.0%) of the amount of such overdue payment
to defray the expenses incurred by Lender in handling and processing such
delinquent payment and to compensate Lender for the loss of the use of the
delinquent payment. Such late charge shall be immediately due and payable,
without notice or demand therefor.
5.03 Default Rate. If this Note is not paid in full on or before the
Maturity Date or the date on which the due date of the indebtedness has been
accelerated pursuant to the provisions hereof, the unpaid principal and accrued
interest and other amounts then due shall bear interest at a rate per annum
("Default Rate") equal to the lesser of (a) five percent (5.0%) in excess of the
Initial Interest Rate or (b) the maximum rate of interest, if any, which may be
charged or collected from Borrower under applicable law. In addition, Lender
shall have the right, without acceleration of the indebtedness, to collect
interest at the Default Rate on any payment due hereunder or under any of
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<PAGE> 23
the Other Security Documents (including, without limitation, late charges and
fees for legal counsel) which is not received by Lender on or before the date on
which such payment originally was due (as such due date may be extended by
applicable grace period, if any). Interest at the Default Rate shall be
immediately due and payable from the due date specified herein or therein and
shall accrue until all Events of Default have been fully cured or full payment
is received, as applicable.
5.04 Interest on Judgments. Interest shall accrue on any judgment obtained
by Lender in connection with the enforcement or collection of this Note until
such judgment amount is paid in full at a rate equal to the greater of (a) the
Default Rate or (b) the legal rate applicable to judgments within such
jurisdiction; provided, however, that interest shall not accrue at a rate in
excess of the maximum rate of interest, if any, which may be charged or
collected from Borrower under applicable law.
5.05 Cumulative Remedies; Attorney Fees. The remedies of Lender in this Note
and in the Other Security Documents, or at law or in equity, shall be cumulative
and concurrent, and may be pursued singly, successively or together in Lender's
sole discretion and as often as occasion therefor shall arise. If Borrower's
obligations under this Note or any of the Other Security Documents are enforced
by Lender through an attorney at law, or any payment due under this Note or the
Other Security Documents is collected by or through an attorney-at-law or
collection agency, Borrower agrees to pay all costs incurred by Lender in
connection therewith, including, but not limited to, reasonable fees and
disbursements of legal counsel (whether with respect to a retained firm or
Lender's in-house staff) and collection agency costs, whether or not suit be
brought. No provision of this Section 5 shall be construed as an agreement or
privilege to extend the date on which any required payment is due (subject to
the applicable grace period, if any), nor as a waiver of any other right or
remedy accruing to Lender by reason of the occurrence of an Event of Default.
The payments required under this Section 5 shall be in addition to, and shall in
no way limit, any other rights and remedies provided for in this Note or any of
the Other Security Documents, nor any other remedies provided by law or in
equity, and shall be added to the principal evidenced by this Note and deemed
secured by the Security Instrument and Other Security Documents.
6. LIMITATIONS ON RECOURSE.
6.01 Exculpation. Notwithstanding anything to the contrary contained in this
Note or in any Other Security Document (but subject to the provisions of
Sections 6.02, 6.03, 6.04 and 6.05), Lender shall not enforce the liability and
obligation of Borrower to perform and observe the obligations contained in this
Note, the Security Instrument or the Other Security Documents by any action or
proceeding to collect damages or wherein a money judgment or any deficiency
judgment or order or any judgment establishing any personal obligation or
liability shall be sought against Borrower or any principal, director, officer,
employee, beneficiary, shareholder, partner, member, trustee, agent or affiliate
of Borrower or any person owning, directly or indirectly, any legal or
beneficial interest in Borrower, or any successors or assigns of any of the
foregoing (collectively, the "Exculpated Parties"). Lender, may bring a
foreclosure action, action for specific performance or other appropriate action
or proceeding to enable Lender to enforce and realize upon the Security
Instrument, the Other Security Documents, and the interest in the Property, the
Rents (as defined in the Security Instrument) and any other collateral given to
Lender created by the Security Instrument
5
<PAGE> 24
and the Other Security Documents; provided, however, subject to the provisions
of Sections 6.02, 6.03, 6.04 and 6.05, that any judgment in any action or
proceeding shall be enforceable against Borrower only to the extent of
Borrower's interest in the Property, in the Rents and in any other collateral
given to Lender in connection with this Note. Lender, by accepting this Note and
the Security Instrument, agrees that it shall not, except as otherwise provided
below, sue for or demand any deficiency judgment against Borrower or any of the
Exculpated Parties in any action or proceeding, under or by reason of or under
or in connection with this Note, the Other Security Documents or the Security
Instrument.
6.02 Reservation of Certain Rights. The provisions of Section 6.01
shall not (a) constitute a waiver, release or impairment of the Obligations (as
defined in the Security Instrument); (b) impair the right of Lender to name
Borrower as a party defendant in any action or suit for judicial foreclosure and
sale under the Security Instrument; (c) affect the validity or enforceability of
any indemnity, guaranty, master lease or similar instrument made in connection
with this Note, the Security Instrument, or the Other Security Documents; (d)
impair the right of Lender to obtain the appointment of a receiver; or (e)
impair the enforcement of the Assignment of Leases and Rents executed in
connection herewith.
6.03 Exceptions to Exculpation. Notwithstanding the provisions of
Section 6.01 to the contrary, Borrower (but not its general partner or the
general partners of its general partner) shall be personally liable to Lender
for (a) the Losses (as defined in the Security Instrument) Lender incurs due to:
(i) fraud or intentional material misrepresentation by Borrower or any other
person or entity acting on behalf of Borrower in connection with the execution
and the delivery of this Note, the Security Instrument or the Other Security
Documents; (ii) Borrower's misapplication or misappropriation of Rents received
by Borrower after the occurrence and during the continuance of an Event of
Default; (iii) Borrower's misapplication or misappropriation of tenant security
deposits or Rents collected more than one (1) month in advance; (iv) the
misapplication or misappropriation of insurance proceeds or condemnation awards
after the occurrence and during the continuance of an Event of Default; (v)
gross negligence, or criminal acts perpetrated by it resulting in forfeiture,
seizure or loss of any portion of the Property; (vi) any failure by Borrower to
comply with the terms and provisions of the Environmental Indemnity (as defined
in the Security Instrument); (vii) any failure by Borrower to comply with the
terms and provisions of Section 4.3 of the Security Instrument; or (viii) any
sale, conveyance, mortgage, grant, bargain, encumbrance, pledge, assignment or
transfer of the Property or any part thereof, within the meaning of Article 8 of
the Security Instrument, without the prior written consent of Lender if such
consent was required, and (b) the payment of any monetary penalty imposed
pursuant to Section 3.11 (d) of the Security Instrument.
6.04 Recourse. Notwithstanding the foregoing, the agreement of Lender
not to pursue recourse liability as set forth in Section 6.01 above SHALL BECOME
NULL AND VOID and shall be of no further force and effect with respect to
Uniprop, Inc. and personal liability may be sought against Uniprop, Inc. in the
event the Property or any part thereof shall become an asset in (A) a voluntary
bankruptcy or insolvency proceeding filed by Borrower or the general partner of
Borrower, or (B) an involuntary bankruptcy or insolvency proceeding commenced
against Borrower or the general partner of Borrower by any Person (other than
Lender) which is not dismissed within 90
6
<PAGE> 25
days of the filing thereof. From and after the SPE Date (as defined in the
Security Instruments), this Section 6.04 shall be of no further force or effect.
6.05 Bankruptcy Claims. Nothing herein shall be deemed to be a waiver
of any right which Lender may have under Sections 506(a), 506(b), 1111 (b) or
any other provisions of the U.S. Bankruptcy Code to file a claim for the full
amount of the Debt secured by the Security Instrument or to require that all
collateral shall continue to secure all of the Debt owing to Lender in
accordance with this Note, the Security Instrument and the Other Security
Documents.
7. NO USURY. This Note is subject to the express condition that at no time
shall Borrower be required or obligated to pay interest (or any other amount
agreed to be paid hereunder which shall be deemed to be interest) at a rate
which would subject Lender to either civil or criminal liability as a result of
being in excess of the maximum interest rate which are permitted by applicable
law to pay. If, from any circumstance whatsoever, Borrower is at any time
required or obligated to pay interest (or any other amount agreed to be paid
hereunder which shall be deemed to be interest) at a rate in excess of such
maximum rate, then the amount to be paid immediately shall be reduced to such
maximum rate, and, as required by applicable law, all previous payments in
excess of such maximum shall be deemed to have been payments in reduction of the
principal balance owing under this Note in the inverse order of maturity
(whether or not then due) or, at the option of Lender, be paid over to Borrower
and not to the payment of interest. All sums paid or agreed to be paid to Lender
for the use, forbearance or detention of the indebtedness evidenced hereby
shall, to the extent permitted by applicable law, be amortized, prorated,
allocated and spread throughout the full stated term of this Note until payment
in full so that the rate or amount of interest on account of said indebtedness
does not exceed the maximum lawful rate of interest from time to time in effect
and applicable to this Note for so long as the Note is outstanding. This Section
will control all agreements between Borrower and Lender in connection with this
Note.
8. GENERAL CONDITIONS.
8.01 No Waiver by Lender. No failure to accelerate the debt evidenced
hereby nor failure or delay in exercising any other right or remedy upon the
occurrence of an Event of Default hereunder, or any acceptance of a partial or
past due payment, or indulgences granted from time to time shall be construed
(a) as a novation of this Note or as a reinstatement of the indebtedness
evidenced hereby, (b) as a waiver or impairment of Lender's right of
acceleration or any other right or remedy available to Lender upon the
occurrence of an Event of Default, or (c) as a waiver of Lender's right
thereafter to insist upon strict compliance with the terms of this Note or any
of the Other Security Documents; and Borrower hereby expressly waives the
benefit of any statute or rule of law or equity now provided, or which may
hereafter be provided, which would produce a result contrary to or in conflict
with the foregoing. No extension of the time for payment of any amount due under
this Note or under any of the Other Security Documents made by Lender's
agreement with any person now or hereafter liable for the payment thereof shall
operate to release, discharge, modify, change or affect the original liability
of Borrower under this Note or any such other person, either in whole or in part
unless Lender agrees otherwise in writing.
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<PAGE> 26
8.02 Borrower's Waivers. Borrower, for itself and all others who may become
liable for payment of all or any part of the indebtedness evidenced by this
Note, hereby waives presentment for payment, demand, protest, and notice of
dishonor, nonpayment, intent to accelerate, and acceleration. Borrower, for
itself and all others who may become liable for payment of all or any part of
the indebtedness evidenced by this Note, hereby further waives and renounces, to
the fullest extent permitted by law, all rights to the benefits of any
moratorium, reinstatement, marshalling, forbearance, valuation, stay, extension,
redemption, appraisement, exemption and homestead now or hereafter provided by
the Constitution and laws of the United States of America and of each state
thereof, both as to party and property (real and personal), against the
enforcement and collection of the obligations evidenced by this Note or the
Other Security Documents.
8.03 Unconditional Payment. If any payment received by Lender hereunder
shall be deemed by a court of competent jurisdiction to have been a voidable
preference or fraudulent conveyance under any bankruptcy, insolvency or other
debtor relief law, then the obligation to make such payment shall survive any
cancellation or satisfaction of this Note or return thereof to Borrower and
shall not be discharged or satisfied with any prior payment thereof or
cancellation of this Note, but shall remain a valid and binding obligation
enforceable in accordance with the terms and provisions hereof, and such payment
shall be immediately due and payable upon demand. No release of any security for
this Note or any party liable for payment of this Note shall release or affect
the liability of Borrower or any other party who may become liable for payment
of all or any part of the indebtedness evidenced by this Note. Lender may
release any guarantor, surety or indemnitor of this Note from liability, in
every instance without the consent of Borrower hereunder and without waiving any
rights which Lender may have hereunder or under any of the Other Security
Documents or under applicable law or in equity.
8.04 Intentionally Omitted.
8.05 Negotiable Instrument. Borrower agrees that this Note shall be deemed a
negotiable instrument, even though this Note, absent this paragraph, may not
otherwise qualify as a negotiable instrument under applicable law.
8.06 Sale by Lender. Lender shall have the right to transfer, sell or assign
this Note, the Security Instrument and the Other Security Documents, and the
obligations hereunder and thereunder.
9. MISCELLANEOUS.
9.01 Notices. All notices and other communications under this Note or under
the Other Security Documents are to be in writing, addressed to the respective
party as set forth in this section, and shall be deemed to have been duly given
(a) upon delivery, if delivered in person with receipt acknowledged by the
recipient thereof, (b) one (1) Business Day after having been deposited for
overnight delivery, fee prepaid, with any reputable overnight courier service,
or (c) three (3) Business Days after having been deposited in any post office or
mail depository regularly maintained by the U.S. Postal Service and sent by
registered or certified mail, postage prepaid, return receipt requested. Initial
addresses for each party are as follows:
8
<PAGE> 27
Borrower:
UNIPROP MANUFACTURED HOUSING
COMMUNITIES INCOME FUND II
280 Daines Street, Suite 300
Birmingham, Michigan 48009
Attention: Paul M. Zlotoff
Facsimile No.: (248) 645-2154
with a copy to:
Jaffe, Raitt, Heuer & Weiss
Suite 2400
One Woodward Avenue
Detroit, Michigan 48226
Attention: Arthur Weiss, Esq.
Facsimile No.: (313) 961-8358
Lender:
GMAC Commercial Mortgage Corporation
650 Dresher Road
P.O. Box 1015
Horsham, Pennsylvania 19044-8015
Attention: Servicing - Executive Vice President
Facsimile No.: (215) 328-3478
and
Commercial Capital Initiatives, Inc.
Wall Street Plaza
88 Pine Street
New York, New York 10005
Attention: Manager - Loan Administration
Facsimile: (212) 269-5286
with a copy to:
Thacher Proffitt & Wood
Two World Trade Center
New York, New York 10048
Attention: Mitchell G. Williams, Esq.
Facsimile No.: (212) 912-7751
9
<PAGE> 28
Each party may establish a new address from time to time by written notice to
the other given in accordance with this section; provided, however, that no
such change of address will be effective until written notice thereof is
actually received by the party to whom such change of address is sent. Notice to
additional parties now or hereafter designated by a party entitled to notice are
for convenience only and are not required for notice to a party to be effective
in accordance with this section. For purposes of this subsection, "Business Day"
shall mean a day on which commercial banks are not authorized or required by law
to close in the State of New York.
9.02 Entire Agreement; Time of Essence. This Note, together with the Other
Security Documents and Lender's commitment letter to Borrower, contain the
entire agreements between Borrower and Lender relating to the subject matter
hereof and thereof, and supersede all prior discussions and agreements (oral or
written) relative hereto and thereto which are not contained herein or therein.
Borrower represents and warrants that it is not relying on any promises,
covenants, representations or agreements in connection with this Note or the
Other Security Documents, other than as expressly set forth herein or therein.
In the event of any conflict between the terms of this Note and the Other
Security Documents, the following order of priority shall be used to resolve
such conflict: The Note shall control over the Security Instruments and the
Security Instruments shall control over all Other Security Documents. Time is of
the essence with respect to all provisions of this Note.
9.03 Modification. Neither this Note nor any of the Other Security Documents
may be changed, waived, supplemented, discharged or terminated orally or by any
act or failure to act on the part of Borrower or Lender, but only by an
agreement in writing signed by the party against whom enforcement thereof is
sought and then only to the extent expressly set forth in such writing. No
person other than a duly authorized officer or agent of Lender shall be deemed
an agent of Lender nor have any authority to waive, modify, supplement or
terminate in any manner whatsoever any of the terms of this Note.
9.04 Binding Effect; Joint and Several Obligations. The terms and provisions
of this Note and the Other Security Documents shall be binding upon and inure to
the benefit of Borrower and Lender and their respective heirs, executors, legal
representatives, successors, successors and assigns, whether by voluntary action
of the parties or by operation of law. The foregoing shall not be construed,
however, to alter any limitations or restrictions applicable to the Borrower
under the Other Security Documents. If Borrower consists of more than one person
or party, the obligations and liabilities under this Note and the Other Security
Documents of each person or party shall be joint and several.
9.05 Unenforceable Provisions. Any provision of this Note or the Other
Security Documents which may be determined by competent authority to be
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective only to the extent of such prohibition or unenforceability
without invalidating 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.
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<PAGE> 29
9.06 Ambiguity and Construction of Certain Terms. Neither this Note nor
any uncertainty or ambiguity herein shall be construed or resolved against
Lender by virtue of the fact that such document has originated with Lender as
drafter. Borrower acknowledges that it has reviewed this Note and has had the
opportunity to consult with counsel on same. This Note, therefore, shall be
construed and interpreted according to the ordinary meaning of the words used so
as to fairly accomplish the purposes and intentions of the parties hereto. All
personal pronouns used herein, whether used in the masculine, feminine or neuter
gender, shall be deemed to include all other genders; the singular shall include
the plural and vice versa. Titles of articles and sections are for convenience
only and in no way define, limit, amplify or describe the scope or intent of any
provisions hereof "Herein," "hereof" and "hereunder" and other words of similar
import refer to this Note as a whole and not to any particular section,
paragraph or other subdivision; "Section" refers to the entire section and not
to any particular subsection, paragraph of other subdivision. Reference to days
for performance shall mean calendar days unless Business Days are expressly
indicated.
9.07 Governing Law. This Note shall be interpreted, construed and
enforced according to the laws of the state of New York.
9.08 Consent to Jurisdiction. Borrower and Lender, by its acceptance of
this Note, agree and consent to the exclusive jurisdiction and venue of any
state or federal court sitting in the county and state where the real property
encumbered by the Security Instrument is located with respect to any legal
action, proceeding, or controversy between them and hereby expressly waive any
and all rights under applicable law or in equity to object to the jurisdiction
and venue of said courts. Borrower further irrevocably consents to service of
process by certified mail, return receipt requested, to Borrower at the address
for Borrower last provided to Lender in accordance with the notice provision of
this Note and agrees that such service shall be effective ten (10) days after
mailing. Nothing herein shall, however, preclude or prevent Lender from bringing
any one or more actions against Borrower in any other jurisdiction as may be
necessary to enforce or realize upon the security or other collateral provided
for this Note.
9.09 WAIVER OF JURY TRIAL. BORROWER HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY RIGHT BORROWER MAY HAVE TO TRIAL BY JURY IN ANY
LEGAL ACTION, PROCEEDING, OR COUNTERCLAIM, WHETHER IN CONTRACT, TORT OR
OTHERWISE, RELATING DIRECTLY OR INDIRECTLY TO THE INDEBTEDNESS EVIDENCED BY THIS
NOTE; THE APPLICATION OR COMMITMENT FOR THE LOAN EVIDENCED BY THIS NOTE; THE
INTERPRETATION, CONSTRUCTION, VALIDITY, ENFORCEMENT OR PERFORMANCE OF THIS NOTE
OR ANY OF THE OTHER SECURITY DOCUMENTS; OR ANY ACTS OR OMISSION OF LENDER, ITS
OFFICERS, EMPLOYEES, DIRECTORS OR AGENTS IN CONNECTION WITH ANY OF THE
FOREGOING.
9.10 Tax Identification Number. Borrower represents and warrants that
its current tax identification number is 38-2702802.
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This Note is given in renewal of the note described on Schedule I
attached hereto and does not constitute new or additional indebtedness.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
12
<PAGE> 31
IN WITNESS WHEREOF, Borrower has executed this Note under seal as of the
date first above written.
BORROWER:
UNIPROP MANUFACTURED HOUSING
COMMUNITIES INCOME FUND II, a
Michigan limited partnership
By: GENESIS ASSOCIATES LIMITED
PARTNERSHIP, a Michigan limited
partnership, its general partner
By: UNIPROP, INC., a Michigan
corporation, its general partner
By: Gloria A. Koster
--------------------------------
Name: Gloria A. Koster
Title: Vice President
PAY TO THE ORDER OF _____________________________________, WITHOUT RECOURSE.
GMAC COMMERCIAL MORTGAGE
CORPORATION
By:
-------------------------------------
Name:
Title:
<PAGE> 32
Schedule I
Mortgage Note dated as of December 1, 1993 in the amount of $4,290,000 made
by Borrower to Neutron-Uniprop, Inc., as assigned to Union Bank,
as trustee.
