Attached files
| file | filename |
|---|---|
| 8-K - Summit Healthcare REIT, Inc | v169075_8k.htm |
| EX-10.4 - Summit Healthcare REIT, Inc | v169075_ex10-4.htm |
| EX-10.3 - Summit Healthcare REIT, Inc | v169075_ex10-3.htm |
| EX-10.2 - Summit Healthcare REIT, Inc | v169075_ex10-2.htm |
Exhibit No. 10.1
PROMISSORY
NOTE
|
$6,640,000.00
|
December
14, 2009
|
THIS PROMISSORY NOTE (this
“Note”) is made
as of December 14, 2009 by NANTUCKET ACQUISITION LLC, a
Delaware limited liability company (“Borrower”), having an
address at c/o Cornerstone Ventures, Inc., 1920 Main Street, Suite 400, Irvine,
California 92614, to and in favor of CORNERSTONE OPERATING PARTNERSHIP,
L.P., a Delaware limited partnership its successors and assigns (“Lender”), having an
address at 1920 Main Street, Suite 400, Irvine, California 92614.
NOW, THEREFORE, FOR VALUE
RECEIVED, Borrower, unconditionally promises to pay to the order of
Lender, without any counterclaim, setoff or deduction whatsoever, on the
Maturity Date (as hereinafter defined), at the office of Lender, or at such
other place as Lender may designate to Borrower in writing from time to time,
the principal sum of SIX
MILLION SIX HUNDRED FORTY THOUSAND AND NO/100 DOLLARS ($6,640,000.00),
together with interest on so much thereof as is from time to time outstanding
and unpaid, from the date of the advance of the principal evidenced hereby, at
the rate of eight percent (8.0%) per annum (the “Note Rate”),
compounded annually, in lawful money of the United States of America, which
shall at the time of payment be legal tender in payment of all debts and dues,
public and private.
SECTION
1
TERMS AND
CONDITIONS
1.01 Non-Revolving
Line of Credit.
|
|
(a)
|
During
the availability period described below, the Lender will provide a line of
credit to Borrower. The amount of the line of credit (the
“Line of Credit
Commitment”) is SIX MILLION SIX HUNDRED FORTY
THOUSAND AND NO/100 DOLLARS
($6,640,000.00).
|
|
|
(b)
|
This
is a non-revolving line of credit. Any amount borrowed, even if
repaid before the expiration date of the line of credit, permanently
reduces the remaining available line of
credit.
|
|
|
(c)
|
The
line of credit is available between the date of this Note and December 31,
2013, or such earlier date as the availability may terminate as provided
in this Note (the “Expiration
Date”). Lender shall have no obligation to disburse
funds hereunder after the Expiration
Date.
|
|
|
(d)
|
Draw
Requests. Each draw request shall be submitted by
Borrower to Lender in writing on the form attached hereto as Exhibit A upon
not less than ten (10) business days notice prior to the date of the
requested draw. Each draw request shall be in an amount not
less than ten thousand dollars ($10,000). No draw requests will
be honored if there is a default under this Note or any of the other Loan
Documents. Draw requests will not be allowed anymore frequently
than monthly.
|
1.02 Payment
of Principal and Interest. Interest shall be computed
hereunder 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. In computing the number of days during which interest
accrues, the day on which funds are initially advanced shall be included
(regardless of the time of day such advance is made), and the day on which funds
are repaid shall be included unless repayment is credited prior to close of
business. Payments in federal funds immediately available in the
place designated for payment received by Lender prior to 2:00 p.m. local time on
a business day at the place designated for payment shall be credited prior to
close of business, while other payments may, at the option of Lender, not be
credited until immediately available to Lender in federal funds at the place
designated for payment prior to 2:00 p.m. local time at said place of payment on
a day on which Lender (or if Lender designates another entity to receive payment
on behalf of Lender, such entity) is open for business.
Payment
of interest only shall be payable in monthly installments, beginning on February
1, 2010, and continuing on the first day of each and every month (each a “Payment Date”)
thereafter through and including January 1, 2015 (the “Maturity Date”), at
which time the entire outstanding principal balance hereof, together with all
accrued but unpaid interest thereon, shall be due and payable in
full. Each such monthly installment shall be applied first to the
payment of accrued interest and then to reduction of principal. If
the advance of the principal amount evidenced by this Note is made on a date
other than the first day of a calendar month, then Borrower shall pay to Lender
contemporaneously with the execution hereof interest at the Note Rate (a) for a
period from the date of such advance through and including the tenth day of the
calendar month in which this Note is funded, if the advance of the principal
amount evidenced by this Note is made prior to the first day of a calendar
month, or (b) for a period from the date of such advance through and including
the first day of the first calendar month following the month in which this Note
is funded, if the advance of the principal amount evidenced by this Note is made
after the first day of a calendar month. For purposes of making
payments hereunder, but not for purposes of calculating interest accrual
periods, if the day on which any payment is due is not a Business Day (as
defined in the Security Instrument), then amounts due on such date shall be due
on the immediately preceding Business Day.
1.03 Prepayment. This
Note may not be prepaid in whole or in part (except as otherwise specifically
provided herein).
Prepayments
of this Note shall not be permitted, except partial prepayments resulting from
Lender applying insurance or condemnation proceeds to reduce the outstanding
principal balance of this Note as provided in the Security
Instrument. No notice of prepayment shall be required under the
circumstance specified in the preceding sentence. No principal amount
repaid may be re-borrowed. All such proceeds shall be payable to
Lender unless prohibited by law, regulation, operation of such policy or the
specific terms of the Loan Documents. Partial payments of principal
shall be applied to the unpaid principal balance evidenced hereby on the next
succeeding Payment Date following Lender's determination to apply insurance or
condemnation proceeds to the partial prepayment of the outstanding principal
balance of this Note.
1.04 Security. The
indebtedness evidenced by this Note and the obligations created hereby are
secured by, among other things, (a) that certain Leasehold Mortgage, Assignment
of Leases and Rents, Security Agreement and Fixture Filing (the “Security
Instrument”), dated of even date herewith, made by Borrower in favor of
Lender, encumbering certain property located in Nantucket County, Massachusetts,
and (b) an Assignment of Leases and Rents, dated of even date herewith, made by
Borrower in favor of Lender (the “Assignment”). The
Security Instrument, the Assignment, together with this Note, the Promissory
Note (Shared Appreciation), any indemnity and guaranty agreement, any hazardous
substances indemnity agreement, and such other agreements, documents and
instruments, together with any and all renewals, modifications, amendments,
restatements, consolidations, substitutions, replacements, and extensions and
modifications thereof, are herein referred to collectively as the “Loan
Documents”. All of the terms and provisions of the Loan
Documents are incorporated herein by reference. Some of the Loan
Documents are to be filed for record on or about the date hereof in the
appropriate public records.
2
1.05 Default. It
is hereby expressly agreed that should any default occur in the payment of
principal or interest as stipulated above and such payment is not made when due,
or should any other default occur under any of the Loan Documents which is not
cured within any applicable grace or cure period therein, including without
limitation, any sale, transfer, conveyance or other violation of the terms of
Section 1.13 of
the Security Instrument, then an “Event of Default” shall exist hereunder, and
in such event the indebtedness evidenced hereby, including all sums advanced or
accrued hereunder or under any other Loan Document, and all unpaid interest
accrued thereon, shall, at the option of Lender and without notice to Borrower,
at once become due and payable and may be collected forthwith, whether or not
there has been a prior demand for payment and regardless of the stipulated date
of maturity.
In the
event that any payment is not received by Lender on the date when due, then in
addition to any default interest payments due hereunder, Borrower shall also pay
to Lender a late charge in an amount equal to five percent (5.0%) of the amount
of such overdue payment in order to defray Lender’s expenses in addressing and
processing the delinquent payment and compensate Lender from the loss of the use
of such payment. Such amount shall be secured by the Loan Documents,
but shall not result in any extension of the Maturity Date nor a waiver of any
other right or remedy available to Lender in connection with the Loan
Documents.
So long
as any default exists hereunder, regardless of whether or not there has been an
acceleration of the indebtedness evidenced hereby, and at all times after
maturity of the indebtedness evidenced hereby (whether by acceleration or
otherwise), interest shall accrue on the outstanding principal balance of this
Note at a rate per annum equal to five percent (5.0%) plus the interest rate
which would be in effect hereunder absent such default or maturity, or if such
increased rate of interest may not be collected under applicable law, then at
the maximum rate of interest, if any, which may be collected from Borrower under
applicable law (the “Default Interest
Rate”), and such default interest shall be immediately due and
payable. Such amounts shall be secured by the Loan Documents, but
shall not result in any extension of the Maturity Date nor a waiver of any other
right or remedy available to Lender in connection with the Loan
Documents.
Borrower
acknowledges that it would be extremely difficult or impracticable to determine
Lender’s actual damages resulting from any late payment or default, and such
late charges and default interest are reasonable estimates of those damages and
do not constitute a penalty. The remedies of Lender in this Note or
in the other Loan Documents, or at law or in equity, shall be cumulative and
concurrent, and may be pursued singly, successively or together in Lender’s
discretion. Time is of the essence with respect to all matters
concerning or relating to this Note. Borrower agrees to pay on demand
all expenses and costs of enforcement, administration and collection incurred or
paid by Lender including, but not limited to, reasonable attorneys’ fees and
disbursements of Lender, whether or not with respect to retained firms, the
reimbursement for the expenses of in-house staff, or otherwise and whether or
not any legal proceeding is commenced hereunder. The foregoing
amounts shall be paid together with interest thereon at the Default Interest
Rate from the date paid or incurred by Lender until such expenses are paid by
the Borrower.
3
1.06 Exculpation. Notwithstanding
anything in the Loan Documents to the contrary, but subject to the
qualifications set forth below, Lender agrees that (i) Borrower shall be liable
upon the indebtedness evidenced hereby and for the other obligations arising
under the Loan Documents to the full extent (but only to the extent) of the
security therefore, the same being all properties (whether real or personal),
rights, estates and interests now or at any time hereafter securing the payment
of this Note and/or the other obligations of Borrower under the Loan Documents
(collectively, the “Property”), (ii) if
default occurs in the timely and proper payment of all or any part of such
indebtedness evidenced hereby or in the timely and proper performance of the
other obligations of Borrower under the Loan Documents, any judicial proceedings
brought by Lender against Borrower shall be limited to the preservation,
enforcement and foreclosure, or any thereof, of the liens, security titles,
estates, assignments, rights and security interests now or at any time hereafter
securing the payment of this Note and/or the other obligations of Borrower under
the Loan Documents, and confirmation of any sale under power of sale, and no
attachment, execution or other writ of process shall be sought, issued or levied
upon any assets, properties or funds of Borrower other than the Property except
with respect to the liabilities described below in this section and in Section
1.07 below, and (iii) in the event of a foreclosure of such liens, security
titles, estates, assignments, rights or security interests securing the payment
of this Note and/or the other obligations of Borrower under the Loan Documents,
whether by judicial proceedings or exercise of power of sale, no judgment for
any deficiency upon the indebtedness evidenced hereby shall be sought or
obtained by Lender against Borrower, except with respect to the liability
described below in this section; provided, however, that,
notwithstanding the foregoing provisions of this section, Borrower shall be
fully and personally liable and subject to legal action (a) for proceeds paid
under any insurance policies (or paid as a result of any other claim or cause of
action against any person or entity) by reason of damage, loss or destruction to
all or any portion of the Property, to the full extent of such proceeds not
previously delivered to Lender, but which, under the terms of the Loan
Documents, should have been delivered to Lender, (b) for proceeds or awards
resulting from the condemnation or other taking in lieu of condemnation of all
or any portion of the Property, or any of them, to the full extent of such
proceeds or awards not previously delivered to Lender, but which, under the
terms of the Loan Documents, should have been delivered to Lender, (c) for all
tenant security deposits or other refundable deposits paid to or held by
Borrower or any other person or entity in connection with leases of all or any
portion of the Property which are not applied in accordance with the terms of
the applicable lease or other agreement, (d) for rent and other payments
received from tenants under leases of all or any portion of the Property paid
more than one (1) month in advance, (e) for rents, issues, profits and revenues
of all or any portion of the Property received or applicable to a period after
any notice of default from Lender hereunder or under the Loan Documents in the
event of any default hereunder or thereunder which are not either applied to the
ordinary and necessary expenses of owning and operating the Property or paid to
Lender, (f) for damage to the Property as a result of intentional misconduct or
gross negligence of, or material waste to or of the Property by, Borrower or any
of its principals, officers or general partners or members, or any agent or
employee of any such persons, or any removal of the Property in violation of the
terms of the Loan Documents, to the full extent of the losses or damages
actually incurred by Lender on account of such damage or removal, (g) for
Borrower’s failure to pay any valid taxes, assessments, mechanic’s liens,
materialmen’s liens or other claims which could create liens on any portion of
the Property, accruing prior to the date Lender acquires actual possession and
control of the Property, which would be superior to the lien or security title
of the Security Instrument or the other Loan Documents, to the full extent of
the amount claimed by any such lien claimant, (h) for all obligations and
indemnities of Borrower under the Loan Documents relating to hazardous or toxic
substances or compliance with environmental laws and regulations to the full
extent of any losses or damages (including, without limitation, those resulting
from diminution in value of the Property or any portion thereof) incurred by
Lender as a result of the existence of such hazardous or toxic substances or
failure to comply with environmental laws or regulations, (i) for fraud or
material misrepresentation in connection with or related to the Loan, including
without limitation, the origination thereof and/or performance thereof, by
Borrower or any of its principals, officers, directors, general partners or
members, any guarantor, any indemnitor or any agent, employee or other person
authorized or apparently authorized to make statements or representations on
behalf of Borrower, any principal, officer, director, general partner,
beneficial owner or member of Borrower, or any guarantor or any indemnitor, to
the full extent of any losses, damages and expenses of Lender on account thereof
(including, without limitation, attorneys’ fees and expenses), (j) for any
amounts paid under leases containing early lease termination and/or surrender
options or otherwise paid by tenants in consideration of an early termination
and/or surrender of any lease and not delivered to Lender in accordance with the
Security Instrument, (k) for all damage, liability, loss, cost and expense
(including, without limitation, attorney’s fees) incurred by Lender as a result
of the termination or revocation of any governmental license or authorization
necessary to permit the operation of the Property as an assisted living
facility, and (l) the costs incurred in recovering such amounts, including,
without limitation, attorneys’ fees and expenses. References herein
to particular sections of the Loan Documents shall be deemed references to such
sections as affected by other provisions of the Loan Documents relating
thereto. Nothing contained in this section shall (1) be deemed to be
a waiver, release or impairment of the indebtedness evidenced by this Note or
the other obligations of Borrower under the Loan Documents or the lien of the
Loan Documents upon the Property, or (2) preclude Lender from foreclosing the
Loan Documents in case of any default hereunder or under any of the Loan
Documents or from enforcing any of the other rights of Lender except as stated
in this section, or (3) limit or impair in any way whatsoever the Environmental
Indemnity Agreement, of even date herewith, executed and delivered in connection
with the indebtedness evidenced by this Note or any other indemnity or guaranty
executed and delivered in connection with the indebtedness evidenced by this
Note, or release, relieve, reduce, waive or impair in any way whatsoever, any
obligation of any party to such Environmental Indemnity Agreement or any other
such indemnity or guaranty or agreement relating hereto. Borrower
agrees that Lender shall not be deemed to have waived any right which Lender may
have under Section 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 the Loan
Documents.
4
1.07 Exceptions
to Exculpation. Notwithstanding anything to the contrary in
this Note or any of the Loan Documents, the obligations of Borrower under this
Note and the other Loan Documents shall be fully recourse to Borrower in the
event that: (i) the first full monthly payment of principal and
interest under this Note is not paid when due; (ii) Borrower fails to maintain
its status as a single purpose entity, as required by, and in accordance with
the terms and provisions of, the Security Instrument; (iii) Borrower fails to
obtain Lender’s prior written consent to any subordinate financing (including,
without limitation, any mezzanine financing) or other voluntary lien encumbering
the Property (excluding, however, the Junior Loan); (iv) Borrower fails to
obtain Lender’s prior written consent to any assignment, transfer, or conveyance
of the Property or any interest therein as required by the Security Instrument;
(v) a receiver, liquidator or trustee of Borrower or of any guarantor or
indemnitor shall be appointed or if Borrower or any guarantor or indemnitor
shall be adjudicated a bankrupt or insolvent, or if any petition for bankruptcy,
reorganization or arrangement pursuant to federal bankruptcy law, or any similar
federal or state law, shall be filed by, consented to, or acquiesced in by,
Borrower or any guarantor or indemnitor or if any proceeding for the dissolution
or liquidation of Borrower or of any guarantor shall be instituted by Borrower
or any guarantor; (vi) Borrower or any guarantor or indemnitor shall have
colluded with other creditors to cause an involuntary bankruptcy filing with
respect to Borrower or any guarantor or indemnitor; or (vii) Borrower defaults
hereunder in any way and Borrower or any guarantor or indemnitor, either before
or after the occurrence of any such default, contests or in any way interferes
with, directly or indirectly, any foreclosure action, Uniform Commercial Code
sale and/or deed in lieu of foreclosure transaction commenced by Lender or with
any other enforcement of Lender’s rights, powers or remedies under any of the
Loan Documents or under any document evidencing, securing or otherwise relating
to any of the Collateral (as such term is defined in the Security Instrument) or
any of the other Property (whether by making any motion, bringing any
counterclaim, claiming any defense, seeking any injunction or other restraint,
commencing any action, seeking to consolidate any such foreclosure or other
enforcement with any other action, or otherwise).
1.08 Delegation
to Servicer. At the option of Lender, the Loan may be serviced
by a servicer or a trustee (together with their respective successors and
assigns, the “Servicer”) selected
by Lender and Lender may delegate all or any portion of its rights and
responsibilities under this Note and the other Loan Documents to the Servicer
pursuant to a servicing agreement between Lender and Servicer.
5
1.09
GENERAL
CONDITIONS
(a) No Waiver;
Amendment. No failure to accelerate the debt evidenced hereby
by reason of default hereunder, acceptance of a partial or past due payment, or
indulgences granted from time to time shall be construed (i) as a novation of
this Note or as a reinstatement of the indebtedness evidenced hereby or as a
waiver of such right of acceleration or of the right of Lender thereafter to
insist upon strict compliance with the terms of this Note, or (ii) to prevent
the exercise of such right of acceleration or any other right granted hereunder
or by any applicable laws; 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 the payment of this Note or
any installment due hereunder, made by agreement with any person or entity now
or hereafter liable for the payment of this Note shall operate to release,
discharge, modify, change or affect the original liability of Borrower under
this Note, either in whole or in part, unless Lender agrees otherwise in
writing. This Note may not be changed orally, but only by a
definitive written agreement signed by the party against whom enforcement of any
waiver, change, modification or discharge is sought. Moreover,
Borrower agrees that it shall not rely on any other memoranda, written analysis,
proposal or conversation or action/inaction on the possibility that the Lender
might ultimately agree to a waiver of any term or provision of this Note or any
other Loan Document. As negotiations may be lengthy and complex, and
may not produce a definitive written agreement, the Borrower should not forego
any opportunities to repay the Note in reliance on any such negotiations or any
proposed written agreement that is not fully-executed.
(b) Waivers. Presentment
for payment, demand, protest and notice of demand, protest and nonpayment and
all other notices are hereby waived by Borrower. Borrower hereby
further waives and renounces, to the fullest extent permitted by law, all rights
to the benefits of any statute of limitations and 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 itself and
in and to all of its property, real and personal, against the enforcement and
collection of the obligations evidenced by this Note or the other Loan
Documents.
(c) Limit of
Validity. Notwithstanding
anything to the contrary contained in this Note or the Security Instrument,
neither the Note Rate nor the Default Interest Rate shall at any time exceed the
Maximum Rate. The term “Maximum Rate,” as
used herein, shall mean, on any day, the highest non-usurious rate of interest
(if any) permitted by applicable law on such day.
It is the
intention of the parties hereto to comply with the usury laws of the State of
Massachusetts and the United States of America. The parties hereto do
not intend to contract for, charge or receive any interest or other charge which
is usurious, and by execution of this Note or the Security Instrument, Borrower
agrees that Lender has no such intent. This Note, the Security
Instrument, the other Loan Documents and all other agreements between Borrower
and Lender or any other holder hereof, which are now existing or hereafter
arising, whether written or oral, are hereby expressly limited so that in no
event whatsoever, whether by reason of acceleration of maturity hereof, or
otherwise, shall the amount paid, or agreed to be paid, to Lender or any other
holder hereof for the use, forbearance or detention of the money to be due
hereunder or otherwise, or for the payment or performance of any covenant or
obligation contained herein or in any other document evidencing, securing or
pertaining to the Debt, exceed the Maximum Rate. If from any
circumstance whatsoever fulfillment of any provisions hereof or other document,
at the time performance of such provisions shall be due, shall involve
transcending the valid limits prescribed by law, then ipso facto, the obligation
to be fulfilled shall be reduced to the Maximum Rate, and if from any such
circumstance Lender or any other holder shall ever receive as interest or
otherwise an amount which will exceed the Maximum Rate, such amount which would
be excessive interest shall be applied to the reduction of the principal amount
owing hereunder (without prepayment premium or penalty) or on account of any
other principal indebtedness of Borrower to the holder and not to the payment of
interest, or if such excessive interest exceeds the unpaid balance of principal
hereof and such other indebtedness, such excess shall be refunded to
Borrower. All sums paid and agreed to be paid to Lender or any other
holder for use, forbearance or detention of the indebtedness of Borrower shall,
to the extent permitted by applicable law, be amortized, prorated, allocated,
and spread throughout the period until payment in full on the Note (or any
renewals, extensions and rearrangement thereof) so that the actual rate of
interest on account of the Debt is uniform throughout the term of this Note (and
all renewals, extensions and rearrangements hereof) and does not exceed the
Maximum Rate. The terms and provisions of this Section 1.09(c) shall
control and supersede any other provision of this Note or the other Loan
Documents.
6
(d) Use of
Funds. Borrower hereby warrants, represents and covenants that
no funds disbursed hereunder shall be used for personal, family or household
purposes and that amounts paid to Borrower hereunder shall be disbursed in
accordance with the related sources and uses statement prepared by Lender and
executed by Borrower on the date hereof and that, subject to the terms of
Section 1.01 above, no other funds are required to be disbursed
hereunder. Borrower hereby acknowledges and confirms that its
execution of such sources and uses statement constitutes its irrevocable and
unconditional consent and authorization to the disbursement and use of the loan
proceeds as described therein.
(e) Unconditional
Payment. Borrower is and shall be obligated to pay principal,
interest and any and all other amounts which become payable hereunder or under
the other Loan Documents absolutely and unconditionally and without any
abatement, postponement, diminution or deduction and without any reduction for
counterclaim or setoff. In the event that at any time 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.
(f)
Further
Assurances. Borrower shall execute and acknowledge (or cause
to be executed and acknowledged) and deliver to Lender all documents, and take
all actions, reasonably required by Lender from time to time to confirm the
rights created under this Note and the other Loan Documents, to protect and
further the validity, priority and enforceability of this Note and the other
Loan Documents, to subject to the Loan Documents any property of Borrower
intended by the terms of any one or more of the Loan Documents to be encumbered
by the Loan Documents, to correct any error in any of the Loan Documents or any
error in the disbursement of any funds pursuant to the Loan Documents, or
otherwise carry out the purposes of the Loan Documents and the transactions
contemplated thereunder; provided, however, that no such
further actions, assurances and confirmations shall alter the exculpation
provisions of this Note (or the other Loan Documents) or increase Borrower’s
obligations under this Note.
7
(g) Submission to Jurisdiction;
Waiver of Jury Trial.
BORROWER,
TO THE FULL EXTENT PERMITTED BY LAW, HEREBY KNOWINGLY, INTENTIONALLY AND
VOLUNTARILY, WITH AND UPON THE ADVICE OF COMPETENT COUNSEL, (A) SUBMITS TO
PERSONAL JURISDICTION IN THE STATE WHERE THE PROPERTY IS LOCATED OVER ANY SUIT,
ACTION OR PROCEEDING BY ANY PERSON ARISING FROM OR RELATING TO THIS NOTE, (B)
AGREES THAT ANY SUCH ACTION, SUIT OR PROCEEDING MAY BE BROUGHT IN ANY STATE OR
FEDERAL COURT OF COMPETENT JURISDICTION SITTING IN OR FOR EITHER THE CITY OR THE
COUNTY WHERE THE PROPERTY IS LOCATED, (C) SUBMITS TO THE JURISDICTION OF SUCH
COURTS, AND (D) AGREES THAT BORROWER WILL NOT BRING ANY ACTION, SUIT OR
PROCEEDING IN ANY OTHER FORUM AND BORROWER FURTHER CONSENTS AND AGREES TO
SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER LEGAL PROCESS IN ANY SUCH SUIT,
ACTION OR PROCEEDING BY REGISTERED OR CERTIFIED U.S. MAIL, POSTAGE PREPAID, TO
BORROWER AT THE ADDRESS FOR NOTICES DESCRIBED ON THE FIRST PAGE HEREOF, AND
CONSENTS AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE IN EVERY RESPECT VALID
AND EFFECTIVE SERVICE (BUT NOTHING HEREIN SHALL AFFECT THE VALIDITY OR
EFFECTIVENESS OF PROCESS SERVED IN ANY OTHER MANNER PERMITTED BY
LAW).
BORROWER,
TO THE FULL EXTENT PERMITTED BY LAW, HEREBY KNOWINGLY, INTENTIONALLY AND
VOLUNTARILY, WITH AND UPON THE ADVICE OF COMPETENT COUNSEL, WAIVES, RELINQUISHES
AND FOREVER FORGOES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING
BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATING TO THIS NOTE OR ANY CONDUCT,
ACT OR OMISSION OF LENDER, OR ANY OF THEIR DIRECTORS, OFFICERS, PARTNERS,
MEMBERS, EMPLOYEES, AGENTS OR ATTORNEYS, OR ANY OTHER PERSONS AFFILIATED WITH
LENDER OR BORROWER BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATING TO THIS
NOTE AND/OR THE LOAN EVIDENCED HEREBY, IN EACH OF THE FOREGOING CASES, WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE.
(h) Miscellaneous. This
Note shall be interpreted, construed and enforced according to the laws of the
State in which the Property is located and the applicable laws of the United
States of America. The terms and provisions hereof shall be binding
upon and inure to the benefit of Borrower and Lender and their respective heirs,
executors, legal representatives, successors, successors-in-title and assigns,
whether by voluntary action of the parties or by operation of law. To
the extent any notice is provided hereunder or under any other Loan Document and
Borrower knows or has reason to believe that any of the foregoing entities are
acting as or on behalf of Lender hereunder, in addition to Lender, Borrower
shall provide such notice to such entity. As used herein, the terms “Borrower”
and “Lender” shall be deemed to include their respective successors,
successors-in-title and assigns, whether by voluntary action of the parties or
by operation of law. Subject to the limitations set forth in Section 1.06 above,
if Borrower consists of more than one person or entity, each shall be jointly
and severally liable to perform the obligations of Borrower under this
Note. All personal pronouns used herein, whether used in the
masculine, feminine or neuter gender, shall 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. Capitalized
terms used in this Note and not otherwise defined herein shall have the meaning
ascribed to them in the Security Instrument or, if not therein defined, as
defined in the other Loan Documents. Time is of the essence with
respect to all provisions of this Note, the Security Instrument and the other
Loan Documents. This Note and the other Loan Documents contain the
entire agreements between the parties hereto relating to the subject matter
hereof and thereof and all prior agreements relative hereto and thereto which
are not contained herein or therein are terminated.
[No
Further Text on this Page; Signature Page Follows]
8
IN
WITNESS WHEREOF, Borrower, intending to be legally bound hereby, has duly
executed this Note under seal as of the day and year first written
above.
|
NANTUCKET ACQUISITION
LLC, a Delaware
limited
liability company
|
||
|
By:
|
Cornerstone Ventures,
Inc., a California
corporation,
its Manager
|
|
|
By:
|
||
|
Terry
G. Roussel, President
|
||
EXHIBIT
A