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Exhibit 10.56
STATE OF SOUTH CAROLINA )
) MODIFICATION AGREEMENT
COUNTY OF GEORGETOWN ) RELATING INTER ALIA TO THE
) FOLLOWING:
)
) MORTGAGE, ASSIGNMENT OF
) LEASES AND RENTS AND
) SECURITY AGREEMENT
) DATED JUNE 2, 1988
) AND RECORDED WITH THE
) REGISTER OF DEEDS
) FOR GEORGETOWN COUNTY,
) SOUTH CAROLINA IN MORTGAGE
) BOOK 337 AT PAGE 133
THIS MODIFICATION AGREEMENT (the "Agreement") executed this 29th day of
June, 2000 to be effective as of the 10th day of May, 2000 by and between
BRUNNER COMPANIES INCOME PROPERTIES, L.P., I, as successor in interest to
DAYTON & ASSOCIATES XII, ("Borrower") and NEW YORK LIFE INSURANCE COMPANY,
whose address is 51 Madison Avenue, New York, New York 10010, ("NYLIC").
WITNESSETH:
WHEREAS, NYLIC previously made a loan available to the Borrower in the
original principal amount of One Million Six Hundred Thousand and No/100
Dollars ($1,600,000.00) (the "Loan");
WHEREAS, the Loan was evidenced by that certain promissory note in the
original amount of $1,600,000.00 from Borrower for the benefit of NYLIC (the
"Note") and secured inter alia by a lien on that certain parcel of real
property and improvements thereon pursuant to that certain Mortgage, Assignment
of Leases and Rents and Security Agreement from Borrower dated June 2, 1988 and
recorded with the Register of Deeds for Georgetown County, South Carolina in
Mortgage Book 337 at Page 133 as amended by that certain Loan Modification and
Extension Agreement and Mortgage Amendment, effective as of June 10, 1993
recorded in Mortgage Book 642, page 299, as further amended by that certain
Second Loan Modification and Extension Agreement and Mortgage Amendment,
effective as of June 10, 1994, recorded in Mortgage Book 742, Page 248 and
further amended by that certain Third Loan Modification and Extension
Agreement, Cross Pledge and Default Agreement, and Mortgage Amendment
Agreement, effective September 29, 1995 recorded in Mortgage Book 796, Page 144
(the "Third Loan Modification Agreement") and further amended by that certain
Modification Agreement, effective October 10, 1998 recorded in Mortgage Book
B1158 Page P249 and by that certain Modification Agreement, effective May 10,
1999 recorded in Mortgage Book 01304, Page 00049 (as amended, modified or
assigned, the "Mortgage").
WHEREAS, the Note and the Mortgage and any and all other documents
related to the Loan are collectively referred to as the "Loan Documents".
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WHEREAS, except as otherwise provided, all terms herein shall have the
meanings ascribed thereto in the Loan Documents;
WHEREAS, the Loan became due and payable in full on May 10, 2000,
which was the maturity date of the Loan, NYLIC has notified Borrower of the
same and Borrower desires NYLIC to waive the maturity date and modify the terms
of the Loan Documents; and
WHEREAS, Borrower and NYLIC have agreed to amend certain terms of the
Loan and the Loan Documents to inter alia change the maturity date of the Loan
to November 10, 2000 and to provide a new repayment schedule.
NOW, THEREFORE, in consideration of the mutual promises contained
hereinbelow, the sum of Five and No/100 Dollars ($5.00) and other good and
valuable consideration, the receipt, sufficiency and adequacy of which the
parties do hereby acknowledge, the parties do hereby agree as follows:
1. The Note, and Loan Documents as applicable, are amended as
follows:
(a) From and after May 10, 2000 through November 10,
2000 (the "Extended Maturity Date"), the Loan will
accrue interest at a fixed rate per annum equal to
seven (7%) percent;
(b) Commencing June 10, 2000 and continuing on the tenth
day of each month thereafter until the Extended
Maturity Date, payments in the amount of $9,338.00
will be due and payable. Such payments will be
applied first to accrued and unpaid interest and
then to principal;
(c) Commencing June 10, 2000 and continuing on the tenth
day of each month thereafter until the Extended
Maturity Date, Borrower will deposit into escrow
with NYLIC payments for insurance and ad valorem
taxes as required under the Loan Documents (such
monthly payments currently being equal to
$3,425.00);
(d) Unless sooner demanded as provided herein, all
outstanding principal together with accrued unpaid
interest due under the Loan shall be due and payable
in full on November 10, 2000;
(e) The Borrower shall be entitled to prepay the Note in
full at par without fee or premium on a date which
is designated by Borrower in writing given to NYLIC
at least ten (10) days prior to such date; and,
(f) Notwithstanding anything to the contrary in the Note
or Loan Documents, NYLIC shall have the right, at
its sole option, upon fifteen (15) days prior
written notice to Borrower, with or without cause
and irregardless of whether
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an event of default shall exist or not, to accelerate
repayment of the Loan in full and demand Borrower
repay the Loan in
full.
(g) The terms and provisions of Section 13. Covenants
Regarding Tenant Improvement, Leasing Commissions,
Capital Improvements and Debt Service Shortfall
Escrow Account of the Third Loan Modification
Agreement are hereby amended to provide that (i) the
designated depository for the purposes of Section 13
shall be NYLIC, or its designated depository; (ii)
all monies to be remitted to NYLIC, or its
designated depository, shall be deposited into an
interest bearing account and disbursed from time to
time, pursuant to the terms of an account control
agreement, the form and content of which shall be
acceptable to NYLIC in its discretion; (iii)
monthly, Borrower shall provide NYLIC with a written
report of the operating expenses and income from the
mortgaged property together with a report on all
leasing activities related to the same containing
names of contact persons with telephone numbers for
potential tenants; and, (iv) every second month, a
status report on the prospects for refinancing the
Note together with potential lenders and potential
time frames will be submitted to NYLIC.
2. The Loan Documents are amended by deleting all references to
the maturity date of "May 10, 2000" and substituting in lieu thereof the
maturity date of November 10, 2000.
3. The principal balance due and owing under the Loan Documents
as of the date hereof, after giving effect to Borrower's payment of all
principal payments required to be paid hereunder, is $1,401,767.74.
4. The Borrower represents and warrants that, at the time of the
execution and delivery of this Agreement, Borrower has good and absolute title
to the real property encumbered by the Loan Documents, and has full power and
authority to subject the same to the lien of the Loan Documents and the same is
free and clear of all liens, charges and encumbrances whatsoever, except those
created by the Loan Documents or those known to NYLIC and those set forth in
NYLIC's existing title insurance policy for the Loan (the "Title Policy").
5. Except as otherwise modified hereby, the terms and provisions
of the Loan Documents shall remain in full force and effect.
6. As a condition precedent to NYLIC's agreement herein:
(a) upon the execution of this Agreement, Borrower shall
pay all costs and expenses, including but not
limited to attorney's fees, recording fees and title
charges incurred in connection with this Agreement
and/or the consummation of the transaction
contemplated hereby.
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(b) no default shall exist under the Loan Documents as
of the date hereof nor shall any event have occurred
which with the passage of time or the giving of
notice, or both, would constitute such a default.
(c) upon execution of the agreement referenced in
Paragraph (e) below, Borrower shall provide NYLIC
evidence that the depository account opened
by Borrower with Regions Bank, N.A. in account
number 6801003992 (the "Account") for the purpose of
holding Net Cash Flow has been closed and all monies
on hand have been remitted to NYLIC, or its
designated depository, in accordance with the
provisions of the account control agreement
referenced in Paragraph 1(g) hereof.
(d) Borrower shall provide or cause to be provided to
NYLIC an independent title report in form and
content acceptable to NYLIC opining that there are
no matters of record filed subsequent to November 1,
1999 except for such matters as are expressly
approved by NYLIC in its discretion.
(e) No later than June 30, 2000, Borrower and NYLIC
shall execute an agreement regarding the monies
deposited and to be deposited with NYLIC, or its
designated depository pursuant to the terms hereof
and Section 13 of the Third Loan Modification
Agreement, such agreement to be in form and content
acceptable to NYLIC in its discretion.
7. Borrower and NYLIC agree that it is the intent of the parties
that the execution of this Agreement or any documents as contemplated by this
Agreement or the consummation of any transactions contemplated by this
Agreement shall constitute a modification, restatement and renewal under the
Loan and shall not be construed as a novation.
8. By executing this Agreement, Borrower is reconfirming the
accuracy and correctness of all representations contained in the Loan
Documents.
9. This Agreement may be executed in two or more counterparts,
each of which shall be deemed to be an original, but all of which shall
constitute one and the same instrument, and in making proof of this Agreement,
it shall not be necessary to produce or account for more than one such
counterpart.
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10. Borrower hereby agrees that NYLIC, and its officers,
directors, employees and agents are irrevocably and unconditionally released
and discharged of any and all claims, demands, obligations, liabilities, costs
and expenses, now existing (including, without limitation, any obligations or
commitment of NYLIC to provide any financial accommodations to Borrower under
the Loan Documents) arising out of or related to the Loan Documents.
IN WITNESS WHEREOF, the parties have executed this Agreement this 28
day of June, 2000 to be effective as of May 10, 2000.
WITNESSES AS TO BORROWER: BORROWER:
BRUNNER COMPANIES INCOME
PROPERTIES, L.P. I, as successor in
interest to DAYTON & ASSOCIATES XII
(SEAL)
\s\ Daniel E. Nixon By: \s\ James M. Hull
------------------------------- ----------------------------------
Name: James M. Hull
--------------------------------
\s\ Wayne Grovenstein Its: Authorized Agent
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IN WITNESS WHEREOF, the parties have executed this Agreement this 29th
day of June, 2000 to be effective as of May 10, 2000.
WITNESS AS TO NYLIC: NYLIC:
NEW YORK LIFE INSURANCE COMPANY
(SEAL)
\s\ Hartley H. Silas By: \s\ Michael J. Falabella
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Name: Michael J. Falabella
-------------------------------
\s\ Bruce R. King Its: Real Estate Vice President
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STATE OF GEORGIA )
) PROBATE
COUNTY OF RICHMOND )
PERSONALLY appeared before me the undersigned witness and made oath
that s/he saw the within-written Brunner Companies Income Properties, L.P. I, as
successor in interest to Dayton & Associates XII by James M. Hull, its
authorized agent, sign, seal, and as its act and deed, deliver the
within-written instrument for the uses and purposes therein mentioned, and that
s/he with the other witness whose signature appears above, witnessed the
execution thereof.
\s\ Wayne Grovenstein
-----------------------------------
Witness
SWORN TO before me this
28 day of June, 2000.
\s\ Karla J. Burg (L.S.)
-------------------------
Notary Public for Georgia
My Commission Expires: Oct. 13, 2001
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STATE OF NEW YORK )
) PROBATE
COUNTY OF NEW YORK )
PERSONALLY appeared before me the undersigned witness and made oath
that s/he saw the within-written New York Life Insurance Company, by Michael J.
Falabella, its R.E. Vice President, sign, seal, and as its act and deed, deliver
the within-written instrument for the uses and purposes therein mentioned, and
that s/he with the other witness whose signature appears above, witnessed the
execution thereof.
\s\ Hartley H. Silas
-----------------------------------
Witness
SWORN TO before me this
29 day of June, 2000.
\s\ Barbara A. Curci (L.S.)
-----------------------------
Notary Public for New York
My Commission Expires: 12/15/2000
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