Exhibit 10.334
ALLSTATE LIFE INSURANCE COMPANY AND
ALLSTATE INSURANCE COMPANY
XXXXXXXX XXXXX XXXXX, XXXXX X0X
XXXXXXXXXX, XXXXXXXX 00000
September 27, 2004
Inland Western Dallas Paradise, L.L.C.
0000 Xxxxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Re: Allstate Life Insurance Company
and Allstate Insurance Company
Loan No. 122533
Paradise Shoppes of Dallas
00 X. Xxxxxxxx Xxxxx, Xxxxxx, Xxxxxxx (the "Property")
Ladies and Gentlemen:
Reference is made to our Commitment Letter dated September 21, 2004, 2004,
as amended (the "Commitment") with respect to a $7,178,700 Loan (the "Loan") to
be evidenced by two Mortgage Notes of even date herewith, one payable to
Allstate Life Insurance Company in the principal amount of $5,384,025 and the
other payable to Allstate Insurance Company in the principal amount of
$1,794,675 (collectively, the "Note"), and to be secured by a Deed to Secure
Debt and Security Agreement of even date herewith (the "Mortgage") encumbering
the Property. Initially capitalized terms used but not otherwise defined in this
letter agreement (the "Letter Agreement") have the same meanings given them in
the Mortgage.
In consideration of your execution and delivery of the documents
evidencing, securing or otherwise pertaining to the Loan (the "Loan Documents"),
you (the "Borrower") and we ("Lender") hereby agree as follows;
1. RELATED AGREEMENT. This Letter Agreement shall constitute a Related
Agreement.
2. IMPOUNDS. With regard to the provisions contained in Section 1.06 of
the Mortgage requiring Borrower to deposit 1/12 of the annual amounts of real
estate taxes, regular and special assessments and insurance premiums, Lender
hereby agrees to defer collection of such monthly deposits for so long as (i)
Borrower is the sole fee simple owner of the Property; (ii) no Event of Default
exists under the Loan Documents and no condition or event exists which with
notice, the passage of time, or both, would constitute an Event of Default;
(iii) at Lender's election, Borrower either pays for a tax reporting service or
Borrower promptly and consistently furnishes evidence that taxes are being
currently paid; and (iv) Borrower promptly and consistently furnishes evidence
that insurance premiums are being currently paid.
3. EARTHQUAKE INSURANCE. With regard to the provisions contained in
Section 1.02 of the Mortgage requiring Borrower obtain earthquake insurance
coverage on the Property, Lender
hereby agrees to waive such requirement until such time as such coverage is
available at commercially reasonable rates and in Lender's reasonable opinion
such coverage is generally required by other institutional lenders.
4. BORROWER'S RIGHT TO TRANSFER THE PROPERTY. Notwithstanding the
provisions contained in Section 1.08 and other applicable provisions of the
Mortgage, Borrower shall have a one time right, provided there is no default or
an event which, with notice or the passage of time, or both, could result in a
default by Borrower under the Loan Documents, to assign, sell or transfer all of
the Property (the "Permitted Transfer") to a party with experience, reasonably
satisfactory to Lender, in managing property similar to the Property and whose
financial condition is reasonably satisfactory to Lender ("Permitted
Transferee"). The Permitted Transfer shall be further conditioned upon: (a) the
payment by Borrower to Lender of a transfer fee equal to one percent of the
outstanding principal balance of the Note (a nonrefundable $5,000 deposit toward
such, transfer fee shall be due at the time Borrower initially requests a
Permitted Transfer, the balance of the transfer fee shall be due on the closing
of the transaction); (b) the reimbursement of all of Lender's expenses,
including legal fees, incurred in connection with the Permitted Transfer; (c)
the Permitted Transferee and such general partners or principals of Permitted
Transferee as Lender may request, assuming, in form and substance satisfactory
to Lender, all obligations of Borrower under the Loan Documents, including,
without limitation, the Environmental Indemnity Agreement and any nonrecourse
exception indemnity agreement, with the same degree of recourse liability as
Borrower and subject to the same exculpatory provisions; (d) Lender's receipt of
a title policy complying with the requirements of the Commitment, updated to the
date of the Permitted Transfer, evidencing that such Permitted Transfer will not
adversely affect Lender's first and prior lien on the Property or any other
rights or interests granted to Lender under the Loan Documents; (e) Lender's
receipt of opinions of counsel acceptable to Lender that all previous opinions,
pertaining to Borrower are true with respect to the Permitted Transferee and the
Permitted Transferee has duly assumed the Loan Documents, and same are valid and
enforceable against Permitted Transferee and the Property; and that Borrower has
the requisite power and authority to properly transfer the Property; (f) the
Property having maintained a Debt Coverage Ratio of not less than 200 percent
for the 12 month period ending 30 days before the date of the Permitted Transfer
and the Property having a projected Debt Coverage Ratio for the next 12 months
based on the most recently approved and certified financial statements and
annual rent roll of not less than 200 percent; (g) the Permitted Transferee
paying to Borrower at least 45 percent cash down payment on the date of the
Permitted Transfer; (h) Lender's receipt and approval of the purchase and sale
contract and copies of the proposed transfer documentation; (i) Lender's receipt
and approval of the Permitted Transferee's resume and financial statements; and
(j) Lender's receipt and approval of an updated MAI appraisal by an appraiser
satisfactory to Lender (prepared at Borrower's expense) specifically confirming
a loan to value ratio of no more than 55 percent.
In addition, Borrower shall have the right, provided there is no default or
an event which, with notice or the passage of time, or both, could result in a
default by Borrower under the Loan Documents, to make a Permitted Transfer to
INLAND WESTERN RETAIL REAL ESTATE TRUST, INC., a Maryland corporation
("Member"), the sole member of Borrower, so long as (x) Borrower pays to Lender
a transfer fee equal to $5,000, (y) the Member assumes, in form and substance
satisfactory to Lender, all obligations of Borrower under the Loan Documents,
including, without limitation, the Environmental Indemnity Agreement, with the
same degree of
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recourse liability as Borrower and subject to the same exculpatory provisions,
and (z) the conditions and requirements set forth in subparagraphs 4(b), (d) and
(e) above are satisfied.
Net Operating Income shall be certified to be true and correct by the
managing general partner, manager or chief financial officer of Borrower.
5. RIGHT TO CHANGE OWNERSHIP INTERESTS IN BORROWER. Notwithstanding the
provisions contained in Section 1.08 and other applicable provisions of the Deed
of Trust, so long as Member maintains its status as a Real Estate Investment
Trust (a "REIT") any encumbrance, security interest or assignment or transfer of
ownership of all types and classes of the shares of Member shall not constitute
an improper encumbrance or transfer.
6. DAMAGE TO PROPERTY. With regard to the provisions contained in Section
1.04(A) of the Mortgage requiring Borrower to notify Lender of damage to the
Property, the cost threshold for notification shall be increased to One Hundred
Thousand Dollars ($100,000). With regard to the provisions contained in Section
1.04(B) and 1.04(C) of the Deed of Trust regarding the estimated cost of
restoration, the threshold amounts shall be increased to Two Hundred Fifty
Thousand Dollars ($250,000).
7. INSURANCE. Lender hereby approves the insurance evidenced by the
certificates attached as EXHIBIT A hereto.
8. PROPERTY MANAGER. Lender hereby approves Inland Northwest Management
Corp. as manager of the Property, subject to its execution of the letter
attached as EXHIBIT B hereto.
9. RIGHTS PERSONAL TO BORROWER. The rights granted to Borrower in
paragraphs 2, 3, 4, 5, 6, 7 and 8 of this Letter Agreement shall be personal to
Borrower and shall not inure to the benefit of any subsequent owner of the
Property. In the event Lender transfers all or any part of the Loan or any
interest in the Loan Documents to any other person or entity, Lender agrees to
notify such transferee(s) of the existence of this Letter Agreement and the fact
that it is binding upon Lender's successors and assigns by delivering such
transferee(s) a true, correct and complete copy of this Letter Agreement
concurrently with such transfer accompanied by a letter of transmittal from
Lender advising such transferee(s) of the binding nature of the provisions of
this Letter Agreement. Lender will send a copy of its letter of transmittal and
the enclosure to Borrower, and Borrower's name will be shown on the face of the
original letter of transmittal as an addressee thereof.
* * * * *
[Signature Page Follows]
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Very truly yours,
ALLSTATE LIFE INSURANCE COMPANY,
an Illinois insurance corporation
By:
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By:
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Its Authorized Signatories
ALLSTATE INSURANCE COMPANY,
an Illinois insurance corporation
By:
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By:
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Its Authorized Signatories
Accepted and agreed:
INLAND WESTERN DALLAS PARADISE, L.L.C.,
a Delaware limited liability company
By: INLAND WESTERN RETAIL REAL ESTATE
TRUST, INC., a Maryland corporation,
Its sole member
By: /s/ [ILLEGIBLE]
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Its Asst. Secretary
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Dated: September 27, 2004
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EXHIBIT A
INSURANCE CERTIFICATES
EXHIBIT B
PROPERTY MANAGER LETTER
INLAND NORTHWEST MANAGEMENT CORP.
September 27, 2004
Allstate Life Insurance Company
and Allstate Insurance Company
x/x Xxxxxxxx Xxxxxxxxxxx, XXX
Xxxxxxxx Xxxxx Xxxxx, Xxxxx X0X
0000 Xxxx Xxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Commercial Mortgage Division
Re: Allstate Life Insurance Company
and Allstate Insurance Company
Loan No. 122533
Paradise Shoppes of Dallas
00 X. Xxxxxxxx Xxxxx, Xxxxxx, Xxxxxxx (the "Property")
Ladies and Gentlemen:
The undersigned ("Manager") is the current property manager of
the Property pursuant to that certain Management Agreement (the "Agreement")
dated July 2, 2004, by and between INLAND WESTERN DALLAS PARADISE, L.L.C., a
Delaware limited liability company ("Owner") and Manager. In consideration of
your making the Loan to Owner (Manager being an affiliate of Owner), Manager
acknowledges and agrees to the following:
1. Allstate, in its sole discretion, may terminate the Agreement by
notice to Manager upon acquisition by Allstate of title to the
Property by foreclosure, deed in lieu of foreclosure, or other
transfer of the Property or upon Allstate otherwise obtaining
possession of the Property by any lawful means. Upon the
appointment of a receiver or court appointed officer, either
Allstate or such receiver or officer may terminate the Agreement
in its sole discretion by notice to Manager.
2. Manager waives any right to create a lien against the Property to
secure payment of unpaid management fees.
3. Upon the occurrence of, and during the continuation of, a default
under any of the documents evidencing the Loan which has not been
cured in Allstate's sole judgment, all management fees paid or
payable to Manager thereafter shall be subordinate to amounts
owed to Allstate under such Loan documents.
4. Upon the occurrence of, and during the continuation of, a default
under any of the documents evidencing the Loan which has not been
cured in Allstate's sole judgment, all management fees and other
sums received by Manager thereafter in connection with management
of the Property shall be held in trust for the benefit of
Allstate.
5. Until Allstate elects to terminate the Agreement as provided
herein, Manager will perform all of its obligations, covenants,
conditions and agreements under the Agreement for the benefit of
Allstate and its successors and assigns, so long as Allstate
performs the duties and obligations of Owner under the Agreement
accruing after the date Allstate exercises its rights under the
Mortgage.
INLAND NORTHWEST MANAGEMENT CORP.
By:
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Its
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