RIDER TO MULTIFAMILY INSTRUMENT
(FOR USE WITH EXCEPTIONS TO NON-RECOURSE GUARANTY)
XXXXXXX AT XXXXXXXX MILL
THIS RIDER TO MULTIFAMILY INSTRUMENT (the "Rider") is made as of this
2nd day of December 1996, and is incorporated into and shall be deemed to
amend and supplement the Multifamily Mortgage, Deed of Trust or Deed to
Secure Debt of the same date (the "Instrument"), given by the undersigned
Xxxxxxx Limited Partnership an Illinois limited partnership (the "Borrower"),
to secure Borrower's Multifamily Note of the same date (the "Note") to GMAC
COMMERCIAL MORTGAGE CORPORATION, a California corporation, 000 Xxxxxxx Xxxx,
Xxxxxxx, Xxxxxxxxxxxx 00000-8015, and its successors, assigns and transferees
(the "Lender"), covering the property described in the Instrument and defined
therein as the "Property," located at:
00000 XXXXXX XXXXXXX, Xxxxxx, Xxxxx
[Property Address]
The Property is located entirely within the state of Texas (the
"Property Jurisdiction").
The term "Loan Documents" when used in this Rider shall mean,
collectively, the following documents: (i) the Instrument, as modified by
this Rider and any other riders to the Instrument given by Borrower to Lender
and covering the Property; (ii) the Note, and (iii) all other documents or
agreements, including any Collateral Agreements (as defined below) or O&M
Agreements (as defined below), arising under, related to, or made in
connection with, the loan evidenced by the Note, as such Loan Documents may
be amended from time to time. Any conflict between the provisions of the
Instrument and the Rider shall be resolved in favor of the Rider.
The covenants and agreements of this Rider, and the covenants and
agreements of any other riders to the Instrument given by Borrower to Lender
and covering the Property, shall be incorporated into and shall amend and
supplement the covenants and agreements of the Instrument as if this Rider
and the other riders were a part of the Instrument and all references to the
Instrument in the Loan Documents shall mean the Instrument as so amended and
supplemented.
ADDITIONAL COVENANTS. In addition to the covenants and agreements made
in the Instrument, Borrower and Lender further covenant and agree as follows:
A. FUNDS FOR TAXES, INSURANCE AND OTHER CHARGES
Uniform Covenant 2 of the Instrument ("Funds for Taxes, Insurance and
Other Charges") is amended to change the title to "Funds for Taxes, Insurance
and Other Charges; Collateral Agreements." Existing Uniform Covenant 2 is
amended to become Uniform Covenant 2A. The following new Uniform Covenant 2B
is added at the end of Uniform Covenant 2A:
2B REPLACEMENT RESERVE AGREEMENT, COMPLETION/REPAIR AGREEMENT, ACHIEVEMENT
AGREEMENT AND OTHER COLLATERAL AGREEMENTS
(a) REPLACEMENT RESERVE AGREEMENT
Borrower shall deposit with Lender the amounts required by the
Replacement Reserve and Security Agreement (the "Replacement Reserve
Agreement") between Borrower and Lender, dated the date of the Note, at the
times required by the Replacement Reserve Agreement, and shall perform all
other obligations as and when required pursuant to the Replacement Reserve
Agreement.
(b) COMPLETION/REPAIR AGREEMENT
Borrower shall deposit with Lender the amount required by the
Completion/Repair and Security Agreement (the "Completion/Repair Agreement")
between Borrower and Lender (if any), dated the date of the Note, at the time
required by the Completion/Repair Agreement, and shall perform all other
obligations as and when required pursuant to the Completion/Repair Agreement.
(c) ACHIEVEMENT AGREEMENT
Borrower shall perform all of its obligations as and when required
pursuant to the Achievement Agreement between Borrower and Lender (if any),
dated the date of the Note.
(d) COLLATERAL AGREEMENTS
As used herein, the term "Collateral Agreement" shall mean any of the
Replacement Reserve Agreement, the Completion/Repair Agreement, the
Achievement Agreement and any similar agreement which has been entered into
between Borrower and Lender in connection with the loan evidenced by the Note.
B. APPLICATION OF PAYMENTS
Uniform Covenant 3 of the Instrument ("Application of Payments") is
amended to add the following sentence at the end thereof:
Notwithstanding the preceding sentence, (i) Lender shall be permitted to
apply any partial payment received from Borrower in any manner determined by
Lender and in any order of priority of application as determined by Xxxxxx,
in Xxxxxx's sole discretion, and (ii) upon any breach of any covenant or
agreement of Borrower in the Instrument, the Note or any other Loan Document,
Lender shall be permitted to apply any funds held pursuant to
RIDER TO MULTIFAMILY INSTRUMENT WITH SEPARATE EXCEPTIONS TO NON-RECOURSE
GUARANTY
- Xxxxxx Xxx Uniform Instrument FORM 4058 6/93 (PAGE 1 OF 8 PAGES)
any Collateral Agreement in any manner which is permitted pursuant to such
Collateral Agreement and in any order of priority of application as
determined by Xxxxxx, in Xxxxxx's sole discretion.
X. XXXXXX INSURANCE; RESTORATION OF PROPERTY
Uniform Covenant 5 of the Instrument ("Hazard Insurance") is amended to
add the following sentence at the end thereof:
Lender shall not exercise Lender's option to apply insurance proceeds to
the payment of the sums secured by the Instrument if all of the following
conditions are met: (i) Borrower is not in breach or default of any provision
of the Instrument, the Note or any other Loan Document; (ii) Lender
determines that there will be sufficient funds to restore and repair the
Property to a condition approved by Lender; (iii) Lender determines that the
rental income of the Property, after restoration and repair of the Property
to a condition approved by Xxxxxx, will be sufficient to meet all operating
costs and other expenses, payments for reserves and loan repayment
obligations relating to the Property; and (iv) Lender determines that
restoration and repair of the Property to a condition approved by Xxxxxx will
be completed prior to the earlier of either (1) the maturity date of the Note
or (2) within one year of the date of the loss or casualty to the Property.
D. ENVIRONMENTAL HAZARDS PROVISION
In addition to Borrower's covenants and agreements under Uniform
Covenant 6 of the Instrument ("Preservation and Maintenance of Property;
Leaseholds"), Borrower further covenants and agrees that Borrower shall not:
(a) cause or permit the presence, use, generation, manufacture,
production, processing, installation, release, discharge, storage
(including aboveground and underground storage tanks for petroleum
or petroleum products), treatment, handling, or disposal of any
Hazardous Materials (as defined below) (excluding the safe and
lawful use and storage of quantities of Hazardous Materials
customarily used in the operation and maintenance of comparable
multifamily properties or for normal household purposes) on or
under the Property, or in any way affecting the Property or its
value, or which may form the basis for any present or future
demand, claim or liability relating to contamination, exposure,
cleanup or other remediation of the Property or,
(b) cause or permit the transportation to, from or across the Property
of any Hazardous Material (excluding the safe and lawful use and
storage of quantities of Hazardous Materials customarily used in
the operation and maintenance of comparable multifamily properties
or for normal household purposes); or permit,
(c) cause or exacerbate any occurrence or condition on the Property
that is or may be in violation of Hazardous Materials Law (as
defined below).
(The matters described in (a), (b) and (c) above are referred to collectively
below as "Prohibited Activities or Conditions.")
Except with respect to any matters which have been disclosed in writing
by Xxxxxxxx to Lender prior to the date of the Instrument, or matters which
have been disclosed in an environmental hazard assessment report of the
Property received by Lender prior to the date of the Instrument, Borrower
represents and warrants that it has not at any time caused or permitted any
Prohibited Activities or Conditions and to the best of its knowledge, no
Prohibited Activities or Conditions exist or have existed on or under the
Property. Borrower shall take all appropriate steps (including but not
limited to appropriate lease provisions) to prevent its employees, agents,
and contractors, and all tenants and other occupants on the Property, from
causing, permitting or exacerbating any Prohibited Activities or Conditions.
Borrower shall not lease or allow the sublease of all or any portion of the
Property for non-residential use to any tenant or subtenant that, in the
ordinary course of its business, would cause, permit or exacerbate any
Prohibited Activities or Conditions, and all non-residential leases and
subleases shall provide that tenants and sub-tenants shall not cause, permit
or exacerbate any Prohibited Activities or Conditions.
If any Prohibited Activities or Conditions exist on the Property(1),
Borrower shall comply in a timely manner with, and cause all employees,
agents, and contractors of Borrower and any other persons present on the
Property to so comply with, (1) any program of operations and maintenance
("O&M Program") relating to the Property that is acceptable to Lender with
respect to one or more Hazardous Materials (which O&M Program may be set
forth in an agreement of Borrower (an "O&M Agreement")) and all other
obligations set forth in any O&M Agreement(2), and (2) all Hazardous
Materials Laws. Any O&M Program shall be performed by qualified personnel.
All costs and expenses of the O&M Program shall be paid by Xxxxxxxx,
including without limitation Lender's fees and costs incurred in connection
with the monitoring and review of the O&M Program and Xxxxxxxx's performance
thereunder. If Xxxxxxxx fails to timely commence or diligently continue and
complete the O&M Program and comply with any O&M Agreement, then Lender may,
at Xxxxxx's option, declare all of the sums secured by the Instrument to be
immediately due and payable, and Xxxxxx may invoke any remedies permitted by
paragraph 27 of the Instrument. Without limiting the foregoing, Borrower
shall take prompt remedial action in the event of the discovery of any
Prohibited Activities or Conditions and obtain Xxxxxx's prior written(3)
Borrower represents that Xxxxxxxx has not received, and has no
knowledge of the issuance of, any claim, citation or notice of any pending or
threatened suits, proceedings, orders, or governmental inquiries or opinions
involving the Property that allege the violation of any Hazardous Materials
Law ("Governmental Actions").
Borrower shall promptly notify Lender in writing of: (i) the occurrence
of any Prohibited Activity or Condition on the Property; (ii) Borrower's
actual knowledge of the presence on or under any adjoining property of any
Hazardous Materials which can reasonably be expected to have a material
adverse impact on the Property or the value of the Property, discovery of any
occurrence or condition on the Property or any adjoining real property that
could cause any restrictions on the ownership, occupancy, transferability or
use of the Property under Hazardous Materials
-------------
1 or if Lender shall require the same in accordance with reasonable commercial
practices
2 or other remedial action requested by Lender
3 approval of any such remedial action.
FORM 4058 6/93 (PAGE 2 OF 8 PAGES)
Law. Borrower shall cooperate with any governmental inquiry, and shall comply
with any governmental or judicial order which arises from any alleged
Prohibited Activities or Conditions; (iii) any Governmental Action: and
(iv) any claim made or threatened by any third party against Xxxxxxxx, Lender,
or the Property relating to loss or injury resulting from any Hazardous
Materials. Any such notice by Borrower shall not relieve Borrower of, or
result in a waiver of any obligation of Borrower under this paragraph D.
Borrower shall pay promptly the costs of any environmental audits,
studies or investigations (including but not limited to advice of legal
counsel) and the removal of any Hazardous Materials from the Property
required by Lender as a condition of its consent to any sale or transfer
under paragraph 19 of the Instrument of all or any part of the Property or any
transfer occurring upon a foreclosure or a deed in lieu of foreclosure or any
interest therein, or required by Lender following a reasonable determination
by Lender that there may be Prohibited Activities or Conditions on or under
the Property. Borrower authorizes Lender and its employees, agents and,
contractors to enter onto the Property for the purpose of conducting such
environmental audits, studies and investigations. Any such costs and expenses
incurred by Xxxxxx (including but not limited to fees and expenses of
attorneys and consultants, whether incurred in connection with any judicial
or administrative process or otherwise) which Borrower fails to pay promptly
shall become immediately due and payable and shall become additional
indebtedness secured by the Instrument pursuant to Uniform Covenant 8 of the
Instrument.
Borrower shall hold harmless, defend and indemnify Lender and its
officers, directors, trustees, employees, and agents from and against all
proceedings (including but not limited to Government Actions), claims,
damages, penalties, costs and expenses (including without limitation fees and
expenses of attorneys and expert witnesses, investigatory fees, and cleanup
and remediation expenses, whether or not incurred within the context of the
judicial process), arising directly or indirectly from (i) any breach of any
representation, warranty, or obligation of Borrower contained in this
paragraph D or (ii) the presence or alleged presence of Hazardous Materials
on or under the Property.
The term "Hazardous Materials," for purposes of this paragraph D,
includes petroleum and petroleum products, flammable explosives, radioactive
materials (excluding radioactive materials in smoke detectors),
polychlorinated biphenyls, lead, asbestos in any form that is or could become
friable, hazardous waste, toxic or hazardous substances or other related
materials whether in the form of a chemical, element, compound, solution,
mixture or otherwise including, but not limited to, those materials defined
as "hazardous substances," "extremely hazardous substances," "hazardous
chemicals," "hazardous materials," "toxic substances," "solid waste," "toxic
chemicals," "air pollutants," "toxic pollutants," "hazardous wastes,"
"extremely hazardous waste," or "restricted hazardous waste" by Hazardous
Materials Law or regulated by Hazardous Materials Law in any manner
whatsoever.
The term "Hazardous Materials Law," for the purposes of this
paragraph D, means all federal, state, and local laws, ordinances and
regulations and standards, rules, policies and other binding governmental
requirements and any court judgments applicable to Borrower or to the Property
relating to industrial hygiene or to environmental or unsafe conditions or to
human health including, but not limited to, those relating to the generation,
manufacture, storage, handling, transportation, disposal, release, emission
or discharge of Hazardous Materials, those in connection with the
construction, fuel supply, power generation and transmission, waste disposal
or any other operations or processes relating to the Property, and those
relating to the atmosphere, soil, surface and ground water, wetlands, stream
sediments and vegetation on, under, in or about the Property.
The representations, warranties, covenants, agreements, indemnities and
undertakings of Borrower contained in this paragraph D shall be in addition
to any and all other obligations and liabilities that Borrower may have to
Lender under applicable law.
The representations, warranties, covenants, agreements, indemnities and
undertakings of Borrower contained in this paragraph D shall continue and
survive notwithstanding the satisfaction, discharge, release, assignment,
termination, subordination or cancellation of the Instrument or the payment
in full of the principal of and interest on the Note and all other sums
payable under the Loan Documents or the foreclosure of the Instrument or the
tender or delivery of a deed in lieu of foreclosure or the release of any
portion of the Property from the lien of the Instrument, except with respect
to any Prohibited Activities or Conditions or violation of any of the
Hazardous Materials Laws which first commences and occurs after the
satisfaction, discharge, release, assignment, termination or cancellation of
the Instrument following the payment in full of the principal of and interest
on the Note and all other sums payable under the Loan Documents or which
first commences or occurs after the actual dispossession from the entire
Property of the Borrower and all entities which control, are controlled by,
or are under common control with the Borrower (each of the foregoing persons
or entities is hereinafter referred to as a "Responsible Party") following
foreclosure of the Instrument or acquisition of the Property by a deed in
lieu of foreclosure. Nothing in the foregoing sentence shall relieve the
Borrower from any liability with respect to any Prohibited Activities or
Conditions or violation of Hazardous Materials Laws where such Prohibited
Activities or Conditions or violation of Hazardous Materials Laws commences
or occurs, or is present as a result of, any act or omission by any
Responsible Party or by any person or entity acting on behalf of a
Responsible Party.
E. BOOKS, RECORDS AND FINANCIAL INFORMATION
Uniform Covenant 10 of the Instrument ("Books and Records") is amended to
read as follows:
Borrower shall keep and maintain at all times and upon Xxxxxx's request,
Borrower shall make available at the Property address, complete and accurate
books of accounts and records in sufficient detail to correctly reflect the
results of the operation of the Property and copies of all written contracts,
leases and other instruments which affect the Property (including but net
limited to all bills, invoices and contracts for electrical service, gas
service, water and
FORM 4058 6/93 (PAGE 3 OF 8 PAGES)
water and sewer service, waste management service, telephone service and
management services). These books, records, contracts, leases and other
instruments shall be subject to examination and inspection at any reasonable
time by Xxxxxx. Borrower shall furnish to Lender the following: and (iv)
promptly upon Xxxxxxxx's receipt, copies of any complaint filed against the
Borrower or the Property management alleging any violation of fair housing
law, handicap access or the Americans with Disabilities Act and any final
administrative or judicial dispositions of such complaints. If Borrower shall
fail to timely provide the financial statements required by clause (i) above,
Lender shall have the right to have the Borrower's books and records audited
in order to obtain such financial statements, and any such costs and expenses
incurred by Lender which Borrower fails to pay promptly shall become
immediately due and payable and shall become additional indebtedness secured
by the Instrument pursuant to paragraph 8 of the Instrument.
F. TRANSFERS OF THE PROPERTY OR SIGNIFICANT INTERESTS IN BORROWER; TRANSFER
FEES
Uniform Covenant 19 of the Instrument ("Transfers of the Property or
Beneficial Interests in Borrower, Assumption") is amended to read as set
forth below:
TRANSFERS OF THE PROPERTY OR SIGNIFICANT INTERESTS IN BORROWER; TRANSFER FEES
(a) DEFINITIONS
For purposes of the Instrument (and the Rider), the following terms have the
respective meanings set forth below:
(1) The term "Key Principal" means the entities who execute(s) the
Exceptions to Non-Recourse Guaranty to Lender dated as of the date
of the Note and any persons or entities who subsequently execute an
Exceptions to Non-Recourse Guaranty to Lender in connection with
the Note.
(2) The term "Transfer" means a sale, assignment, transfer or other
disposition (whether voluntary or by operation of law) of, or the
granting or creating of a lien, encumbrance or security interest
in, the Property or in ownership interests, and the issuance or
other creation of ownership interests in an entity and the
reconstitution of one type of entity to another type of entity.
(3) A "Significant Interest" in any entity shall mean the following:
(i) if the entity is a general partnership or a joint venture,
(A) any partnership interest in the general partnership, or
(B) any interest of a joint venturer in a joint venture;
(ii) if the entity is a limited partnership, (A) any limited
partnership interest in the entity or (B) any general
partnership interest in the entity;
(iii) if the entity is a limited liability company, any membership
interest;
(iv) if the entity is a corporation, any voting stock in the
corporation; or
(v) if the entity is a trust, any beneficial interest in such
trust
(b) ACCELERATION OF THE LOAN UPON TRANSFERS OF THE PROPERTY OR SIGNIFICANT
INTERESTS
Lender may, at Xxxxxx's option, declare all sums secured by the
Instrument immediately due and payable and Lender may invoke any remedies
permitted by paragraph 27 of the Instrument if, without the Lender's prior
written consent, any of the following shall occur.
(1) a Transfer of all or any part of the Property or any interest in
the Property;
(2) a Transfer of any Significant Interest in Borrower;
(3) a Transfer of any Significant Interest in a corporation,
partnership, limited liability company, joint venture, or trust
which owns a Significant Interest in the Borrower;
(4) if the Borrower is a trust, or if any trust owns a Significant
Interest in the Borrower, the addition, deletion or
substitution of a trustee of such trust, which addition,
deletion or substitution has not been approved by Xxxxxx; or
1 SEE SUPPLEMENTAL RIDER TO MULTIFAMILY INSTRUMENT. FORM 4058 6/93
(PAGE 4 OF 8 PAGES)
(5) a Transfer of all or any part of any Key Principal's ownership
interest (other than limited partnership interests) in the
general partner or limited partner of the Borrower, or in any
other entity which owns, directly or indirectly, through one
or more intermediate entities, an ownership interest in the
Borrower.
(d) NO ACCELERATION OF THE LOAN FOR TRANSFERS CAUSED BY CERTAIN EVENTS
Notwithstanding the foregoing provisions of this covenant, Xxxxxx shall
not be entitled to declare sums secured by the Instrument immediately due and
payable or to invoke any remedy permitted by paragraph 27 of the Instrument
solely upon the occurrence of any of the following:
(1) A Transfer that occurs by inheritance, devise, or bequest or by
operation of law upon the death of a natural person who is an
owner of the Property or the owner of a direct or indirect
ownership interest in the Borrower.
(2) The grant of a leasehold interest in individual dwelling units
for a term of two years or less and leases for commercial uses
as long as commercial leases do not exceed 20 percent of the
rentable space of the Property (measured as required by Lender)
and provided that all such leasehold interests do not contain
an option to purchase the Property.
(3) A sale or other disposition of obsolete or worn out personal
property which is contemporaneously replaced by comparable
personal property of equal or greater value which is free and
clear of liens, encumbrances and security interests other than
those created by the Loan Documents.
(4) The creation of a mechanic's or materialmen's lien or judgment
lien against the Property which is released of record or
otherwise remedied to Xxxxxx's satisfaction, within 30 days of
the date of creation.
(5) The grant of an easement, if prior to the granting of the
easement the Borrower causes to be submitted to Lender all
information required by Lender to evaluate the easement, and if
Lender determines that the easement will not materially affect
the operation of the Property or Xxxxxx's interest in the
Property and Borrower pays to Lender, on demand, all cost and
expenses incurred by Lender in connection with reviewing
Xxxxxxxx's request.
G. NOTICE
Uniform Covenant 20 of the Instrument ("Notice") is amended to read as
follows:
Each notice, demand, consent, or other approval (collectively, "notices"
and singly, "notice") given under the Note, the Instrument, and any other
Loan Document, shall be in writing to the other party, and if to Borrower, at
its address set forth below Borrower's signature on the Instrument, and if to
Lender at its address set forth at the beginning of the Rider, or at such
other address as such party may designate by notice to the other party and
shall be deemed given (a) three (3) Business Days after mailing, by certified
or registered U.S. mail, return receipt requested,
FORM 4058 6/93 (PAGE 5 OF 8 PAGES)
postage prepaid, (b) one (1) Business Day after delivery, fee prepaid, to a
national overnight delivery service, or (c) when delivered, if personally
delivered with proof of delivery thereof.
Xxxxxxxx and Xxxxxx each agrees that it will not refuse or reject
delivery of any notice given hereunder, that it will acknowledge, in writing,
the receipt of the same upon request by the other party and that any notice
rejected or refused by it shall be deemed for all purposes of this Agreement
to have been received by the rejecting party on the date so refused or
rejected, as conclusively established by the records of the U.S. Postal
Service or the courier service. As used in the Instrument, the term "Business
Day" means any day other than a Saturday, a Sunday or any other day on which
Lender is not open for business.
Lender shall not be required to deliver notice to Key Principal in
connection with any notice given to Borrower. However, if Xxxxxx shall
deliver notice to Key Principal, such notice shall be given in the manner
provided in this Uniform Covenant 20, at Key Principal's address set forth at
the foot of the Rider.
I. ACCELERATION; REMEDIES
Covenant 27 of the Instrument ("Acceleration: Remedies") is amended to add
the following at the end of the first paragraph:
Upon the breach of any covenant or agreement by Borrower in the
Instrument, (including, but not limited to, the covenants to pay when due
sums secured by the Instrument) or any other Loan Document, Lender, at
Xxxxxx's option may, in addition to any remedies specified in this covenant,
invoke any other remedies provided in any Collateral Agreement.
If Borrower is in default under any promissory note (other than the Note)
evidencing a loan (the "Subordinate Loan") secured by a security instrument
(other than the Instrument) covering all or any portion of the Property (the
"Subordinate Instrument") or under any Subordinate Instrument or other loan
document executed in connection with the Subordinate Loan, (and whether or
not the Borrower has obtained the prior approval of Lender to the placement
of such Subordinate Instrument on the Property) which default remains uncured
after any applicable cure period, Borrower also then will be in default under
the Note and the Instrument. In that event, the entire unpaid principal
balance of the Note, accrued interest and any other sums due Lender secured
by the Instrument then will become due and payable, at Lender's option. If
Lender exercises this option to accelerate, Lender will do so in accordance
with the provisions of the Note and the Instrument, and the Lender may invoke
any and all remedies permitted by applicable law, the Note, the Instrument,
or any of the other Loan Documents.
J. SINGLE ASSET BORROWER
Until the debt evidenced by the Note is paid in full, Borrower shall not
(1) acquire any real or personal property other than the Property and assets
(such as accounts) related to the operation and maintenance of the Property,
or (2) operate any business other than the management and operation of the
Property.
K. NON-RECOURSE LIABILITY
Subject to the provisions of paragraph L and notwithstanding any other
provision in the Note or Instrument, the personal liability of Borrower, any
general partner of Xxxxxxxx (if Borrower is a partnership), and any Key
Principal to pay the principal of and interest on the debt evidenced by the
Note and any other agreement evidencing Borrower's obligations under the Note
and the Instrument shall be limited to (1) the real and personal property
described as the "Property" in the Instrument, (2) the personal property
described in and pledged under any
FORM 4058 6/93 (PAGE 6 OF 8 PAGES)
Collateral Agreement executed in connection with the loan evidenced by the
Note, (3) the rents, profits, issues, products and income of the Property
received or collected by or on behalf of Borrower (the "Rents and profits")
to the extent such receipts are necessary, first, to pay the reasonable
expenses of operating, managing, maintaining and repairing the Property,
including but not limited to real estate taxes, utilities, assessments,
insurance premiums, repairs, replacements and ground rents, if any (the
"Operating Expenses") then due and payable as of the time of receipt of such
Rents and Profits, and then, to pay the principal and interest due under the
Note, and any other sums due under the Instrument or any other Loan Document
(including but not limited to deposits or reserves due under any Collateral
Agreement), except to the extent that Borrower did not have the legal right,
because of a bankruptcy, receivership or similar judicial proceeding, to
direct the disbursement of such sums.
Except as provided in paragraph L, Lender shall not seek (a) any judgment
for a deficiency against Borrower, any general partner of Borrower (if
Borrower is a partnership) or any Key Principal or Borrower's or any such
general partner's or Key Principal's heirs, legal representatives, successors
or assigns, in any action to enforce any right or remedy under the Instrument,
or (b) any judgment on the Note except as may be necessary in any action
brought under the Instrument to enforce the lien against the Property or to
exercise any remedies under any Collateral Agreement.
L. EXCEPTIONS TO NON-RECOURSE LIABILITY
If, without obtaining Lender's prior written consent, (i) a Transfer shall
occur which, pursuant to Uniform Covenant 19 of the Instrument, gives Lender
the right, at its option, to declare all sums secured by the Instrument
immediately due and payable, (ii) Borrower shall encumber the Property with
the lien of any Subordinate Instrument in connection with any financing by
Borrower, or (iii) Borrower shall violate the single asset covenant in
paragraph J of the Rider, any of such events shall constitute a default by
Borrower under the Note, the Instrument and the other Loan Documents and if
such event shall continue for 30 days, paragraph K shall not apply from and
after the date which is 30 days after such event and the Borrower, any
general partner of Borrower (if Borrower is a partnership) and Key Principal
(each individually on a joint and several basis if more than one) shall be
personally liable on a joint and several basis for full recourse liability
under the Note and the other Loan Documents.
Notwithstanding paragraph K, Borrower, any general partner of Borrower (if
Borrower is a partnership) and Key Principal (each individually on a joint
and several basis if more than one), shall be personally liable on a joint
and several basis, in the amount of any loss, damage or cost (including but
not limited to attorneys' fees) resulting from (A) fraud or material
misrepresentation by Borrower or Borrower's agents or employees or any Key
Principal or general partner of Borrower in connection with obtaining the
loan evidenced by the Note, or in complying with any of Borrower's
obligations under the Loan Documents, (B) insurance proceeds, condemnation
awards, security deposits from tenants and other sums or payments received by
or on behalf of Borrower in its capacity as owner of the Property and not
applied in accordance with the provisions of the Instrument (except to the
extent that Borrower did not have the legal right, because of a bankruptcy,
receivership or similar judicial proceeding, to direct disbursement of such
sums or payments), (C) all Rents and Profits (except to the extent that
Borrower did not have the legal right, because of a bankruptcy, receivership
or similar judicial proceeding, to direct the disbursement of such sums), and
not applied, first, to the payment of the reasonable Operating Expenses as
such Operating Expenses become due and payable, and then, to the payment of
principal and interest then due and payable under the Note and all other sums
due under the Instrument and all other Loan Documents (including but not
limited to deposits or reserves payable under any Collateral Agreement), (D)
Borrower's failure to pay transfer fees and charges due under paragraph 19(c)
of the Instrument, or (E) Borrower's failure following a default under any of
the Loan Documents to deliver to Lender on demand all Rents and Profits, and
security deposits (except to the extent that Borrower did not have the legal
right because of a bankruptcy, receivership or similar judicial proceeding to
direct disbursement of such sums), books and records relating to the
Property, or (F) or relating Hazardous Materials*
No provision of paragraphs K or L shall (i) affect any guaranty or similar
agreement executed in connection with the debt evidenced by the Note,
(ii) release or reduce the debt evidenced by the Note, (iii) impair the right
of Lender to enforce the provisions of paragraph D of the Rider, (iv) impair
the lien of the Instrument or (v) impair the right of Lender to enforce the
provisions of any Collateral Agreement.
X. XXXXXX OF JURY TRIAL
Xxxxxxxx and Key Principal (each for himself if more that one)
(i) covenant and agree not to elect a trial by jury with respect to any issue
arising under any of the Loan Documents triable by a jury and (ii) waive any
right to trial by jury to the extent that any such right shall now or
hereafter exist. This waiver of right to trial by jury is separately given,
knowingly and voluntarily with the benefit of competent legal counsel by the
Borrower and Key Principal, and this waiver is intended to encompass
individually each instance and each issue as to which the right to a jury
trial would otherwise accrue. Further, Borrower and Key Principal hereby
certify that no representative or agent of the Lender (including, but not
limited to, the Lender's counsel) has represented, expressly or otherwise, to
Borrower or Key Principal that Lender will not seek to enforce the provisions
of this paragraph M.
* or compliance with Hazardous Materials Laws to the full extent of any
losses or damages (including those resulting from diminution in value of the
Property) incurred by Xxxxxx as a result of the existence of such Hazardous
Materials or failure to comply with Hazardous Materials Laws or the
obligations of Borrower hereunder relating thereto.
FORM 4058 6/93 (PAGE 7 OF 8 PAGES)
BY SIGNING XXXXX, Xxxxxxxx accepts and agrees to the covenants and
agreements contained in this Rider.
Borrower:
XXXXXXX LIMITED PARTNERSHIP, an
Illinois limited partnership
By: AIMCO LT, L.P., a Delaware limited
partnership, its general partner
By: AIMCO HOLDINGS, L.P., a Delaware
limited partnership, its general
partner
By: AIMCO HOLDINGS QRS, INC., a
Delaware corporation, its
general partner
By: /s/ X. Xxxxxx
---------------------------
Name: Xxxxx Xxxxxx
-------------------------
Title: VP
-------------------------
FORM 4058 6/93 (PAGE 8 OF 8 PAGES)
