Exhibit 10.37
Loan No. 1000625
AMENDED AND RESTATED PROMISSORY
NOTE SECURED BY MORTGAGE
(100-200 Campus Drive –
Florham Park, NJ)
|
|
|
|
$89,800,000
|
|
Irvine, California
March 11, 2009
|
FOR VALUE RECEIVED, the undersigned
KBSII 100-200 CAMPUS DRIVE, LLC, a Delaware limited
liability company (“ Borrower ”) promise(s) to
pay to the order of WELLS FARGO BANK, NATIONAL ASSOCIATION
(“ Lender ”), at the Los Angeles Loan Center,
2120 East Park Place, Suite 100, El Segundo, California 90245, or
at such other place as may be designated in writing by Lender, the
principal sum of EIGHTY NINE MILLION EIGHT HUNDRED THOUSAND DOLLARS
($89,800,000) or so much thereof as may from time to time be owing
hereunder by reason of advances by Lender to or for the benefit or
account of Borrower, with interest thereon, per annum, at one or
more of the Effective Rates calculated in accordance with the terms
and provisions of the Fixed Rate Agreement attached hereto as
Exhibit A and a Fixed Rate Notice described on Exhibit
B attached hereto (based on a 360-day year and charged on the
basis of actual days elapsed). All sums owing hereunder are payable
in lawful money of the United States of America, in immediately
available funds without offset, deduction or counterclaim of any
kind.
Interest accrued on this Amended and
Restated Promissory Note Secured by Mortgage (“Note”)
shall be due and payable on the first Business Day (as defined in
Exhibit A ) of each month commencing with the first month
after the date of this Note.
The outstanding principal balance of
this Note, together with all accrued and unpaid interest, shall be
due and payable in full on June 9, 2009 (“ Maturity
Date ”). Unless expressly defined herein, all capitalized
terms used herein shall have the meanings ascribed to them in the
Loan Agreement (as defined in Exhibit A ). Principal amounts
outstanding hereunder, upon which repayment obligations exist and
interest accrues, shall be determined by the records of Lender,
which shall be deemed to be conclusive in the absence of clear and
convincing evidence to the contrary presented by
Borrower.
This Note is secured by, among other
things, that certain Mortgage with Absolute Assignment of Leases
and Rents, Security Agreement and Fixture Filing dated as of
September 9, 2008 (as the same may be amended or modified, the
“ Mortgage ”), executed by Borrower for the
benefit of Lender.
In order to assure timely payment to
Lender of accrued interest, principal, fees and late charges due
and owing under the loan evidenced by this Note, Borrower hereby
irrevocably authorizes Lender to directly debit Borrower’s
demand deposit account with Lender, account no. 4121-770986, for
payment when due of all such amounts payable to Lender. Borrower
represents and warrants to Lender that Borrower is the legal owner
of said account. Written confirmation of the amount and purpose of
any such direct debit shall be given to Borrower by Lender not less
frequently than monthly. In the event any direct debit hereunder is
returned for insufficient funds, Borrower shall pay Lender upon
demand, in immediately available funds, all amounts and expenses
due and owing to Lender.
If any interest payment required
hereunder is not received by Lender (whether by direct debit or
otherwise) on or before the fifteenth (15th) calendar day of
the month in which it becomes due, Borrower shall pay, at
Lender’s option, a late or collection charge equal to four
percent (4%) of the amount of such unpaid interest payment (“
Late Charge ”).
If: (a) Borrower shall fail to pay
when due any sums payable hereunder, subject to any grace or cure
period provided in the Loan Agreement; or (b) any other
Event of Default occurs under the Loan Agreement, the Mortgage or
any other Loan Document; or (c) the property which is subject
to the Mortgage, or any portion thereof or interest therein, is
sold, transferred, mortgaged, assigned, encumbered or leased,
whether voluntarily or involuntarily or by operation of law or
otherwise, other than as expressly permitted by Lender in writing;
THEN Lender may, at its sole option, declare all sums owing
under this Note immediately due and payable; provided ,
however , that if any document related to this Note provides
for automatic acceleration of payment of sums owing hereunder, all
sums owing hereunder shall be automatically due and payable in
accordance with the terms of that document.
Page 1 of 11
Loan No. 1000625
If any attorney is engaged by Lender
to enforce or defend any provision of this Note or the Mortgage, or
as a consequence of any Event of Default, with or without the
filing of any legal action or proceeding, then Borrower shall pay
to Lender immediately upon demand all attorneys’ fees and all
costs incurred by Lender in connection therewith, together with
interest thereon from the date of such demand until paid at the
rate of interest applicable to the principal balance owing
hereunder as if such unpaid attorneys’ fees and costs had
been added to the principal.
No previous waiver and no failure or
delay by Lender in acting with respect to the terms of this Note or
the Loan Agreement or any other Loan Document shall constitute a
waiver of any breach, default, or failure of condition under this
Note, the Loan Agreement or any other Loan Document. A waiver of
any term of this Note, the Mortgage or of any of the obligations
secured thereby must be made in writing and shall be limited to the
express written terms of such waiver. In the event of any
inconsistencies between the terms of this Note and the terms of any
other document related to the loan evidenced by this Note, the
terms of this Note shall prevail.
If this Note is executed by more
than one person or entity as Borrower, the obligations of each such
person or entity shall be joint and several. No person or entity
shall be a mere accommodation maker, but each shall be primarily
and directly liable hereunder. Except as otherwise provided in any
agreement executed in connection with this Note, Borrower waives:
presentment; demand; notice of dishonor; notice of default or
delinquency; notice of acceleration; notice of protest and
nonpayment; notice of costs, expenses or losses and interest
thereon; notice of late charges; and diligence in taking any action
to collect any sums owing under this Note or in proceeding against
any of the rights or interests in or to properties securing payment
of this Note.
Time is of the essence with respect
to every provision hereof. This Note shall be construed and
enforced in accordance with the laws of the State of California,
except to the extent that federal laws preempt the laws of the
State of California, and all persons and entities in any manner
obligated under this Note consent to the jurisdiction of any
federal or state court within the State of California having proper
venue and also consent to service of process by any means
authorized by California or federal law.
Borrower recognizes that its default
in making any payment as provided herein or in any other Loan
Document as agreed to be paid when due, or the occurrence of any
other Event of Default hereunder or under any other Loan Document,
will require Lender to incur additional expense in servicing and
administering the Loan, in loss to Lender of the use of the money
due and in frustration to Lender in meeting its other financial and
loan commitments and that the damages caused thereby would be
extremely difficult and impractical to ascertain. Borrower agrees
(a) that an amount equal to the Late Charge plus the accrual
of interest at the Alternate Rate (as defined in Exhibit A )
is a reasonable estimate of the damage to Lender in the event of a
late payment, and (b) that the accrual of interest at the
Alternate Rate following any Event of Default, other than that
arising out of a late payment, plus any Fixed Rate Price Adjustment
(as defined in Exhibit A ), is a reasonable estimate of the
damage to Lender in the event of such other Event of Default,
regardless of whether there has been an acceleration of the loan
evidenced hereby. Nothing in this Note shall be construed as an
obligation on the part of Lender to accept, at any time, less than
the full amount then due hereunder, or as a waiver or limitation of
Lender’s right to compel prompt performance.
All notices or other communications
required or permitted to be given pursuant to this Note shall be
given to the Borrower or Lender at the address and in the manner
provided for in the Loan Agreement, except as otherwise provided
herein.
The Loan Documents contain or
expressly incorporate by reference the entire agreement of the
parties with respect to the matters contemplated therein and
supersede all prior negotiations or agreements, written or oral.
The Loan Documents shall not be modified except by written
instrument executed by all parties. Any reference to the Loan
Documents includes any amendments, renewals or extensions now or
hereafter approved by Lender in writing.
The limitations on personal
liability of shareholders, partners and members of Borrower
contained in Section 11.21 of the Loan Agreement shall apply
to this Note.
Page 2 of 11
Loan No. 1000625
This Note renews, restates, amends,
replaces and supercedes that certain Promissory Note Secured by
Mortgage dated September 9, 2008 executed by Borrower and made
payable to the order of Lender in the original principal amount of
$89,800,000 (the “ Prior Note ”). It is the
intention of Borrower and Lender that while this Note amends,
restates, renews, replaces and supercedes the Prior Note, it is not
in payment of the Prior Note, but rather is the substitution of one
evidence of debt for another. This Note shall in no event be deemed
to constitute a waiver, novation, release, discharge or other
extinguishment of the indebtedness evidenced by the Prior Note,
which continues in full force in effect, as amended and restated by
the terms of this Note. The Prior Note is no longer separately
negotiable since it has been replaced by this Note.
Exhibits A and B are attached hereto and
incorporated herein by reference.
[Signature Follows on Next
Page]
Page 3 of 11
Loan No. 1000625
IN WITNESS WHEREOF, the Borrower has
executed this Note as of the date set forth above.
“BORROWER”
KBSII 100-200 CAMPUS DRIVE,
LLC,
a Delaware limited liability company
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
|
KBSII REIT
ACQUISITION I, LLC,
|
|
|
a Delaware limited liability company,
its sole member
|
|
|
|
|
|
By:
|
|
KBS REIT
PROPERTIES II, LLC,
|
|
|
|
|
a Delaware limited liability company,
its sole member
|
|
|
|
|
|
|
|
|
By:
|
|
KBS LIMITED PARTNERSHIP II,
|
|
|
|
|
|
|
a Delaware limited partnership,
its sole member
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
|
KBS REAL ESTATE INVESTMENT TRUST II, INC.,
|
|
|
|
|
|
|
|
|
a Maryland corporation,
general partner
|
|
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
|
/s/Charles J. Schreiber, Jr.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charles J. Schreiber, Jr.
|
|
|
|
|
|
|
Chief Executive Officer
|
|
|
Page 4 of 11
EXHIBIT A
Loan No. 1000625
FIXED RATE
AGREEMENT
Exhibit A to an Amended and Restated Promissory Note
Secured by Mortgage (“Note”), dated March 11,
2009, made by KBSII 100-200 CAMPUS DRIVE, LLC , a Delaware
limited liability company, as Borrower, to the order of WELLS
FARGO BANK, NATIONAL ASSOCIATION , as Lender.
Borrower has requested and Lender
has agreed to provide the option to fix the rate of interest for
specified periods on specified portions of the outstanding
principal balance as a basis for calculating the Effective Rate on
such portions of the principal amounts owing under this Note.
Borrower understands: (i) the process of exercising the fixed
rate option as provided herein; (ii) that amounts owing under
this Note may bear interest at different rates and for different
time periods; and (iii) that absent the terms and conditions
hereof, it would be extremely difficult to calculate Lender’s
additional costs, expenses, and damages upon the occurrence of an
Event of Default (as defined in the Loan Agreement) or prepayment
by Borrower hereunder. Given the above, Borrower agrees that the
provisions herein (including, without limitation, the Fixed Rate
Price Adjustment defined below) provide for a reasonable and fair
method for Lender to recover its additional costs, expenses and
damages for an Event of Default or prepayment by
Borrower.
|
1.
|
RATES AND
TERMS DEFINED .
Various rates and terms not otherwise defined herein are defined
and described as follows:
|
“ Alternate Rate
” is a rate of interest per annum five percent (5%) in
excess of the applicable Effective Rate.
“ Applicable LIBO Rate
” is the rate of interest, equal to the sum of:
(a) three and one-half percent (3.50%) plus
(b) the LIBO Rate, which rate is divided by one
(1.00) minus the Reserve Percentage:
|
|
|
|
|
|
|
|
Applicable LIBO Rate = 3.50%
|
|
+
|
|
|
|
|
|
|
|
|
|
|
|
|
(1 - Reserve Percentage)
|
|
|
“ Business Day ”
is a day of the week (but not a Saturday, Sunday or holiday) on
which the offices of Lender are open to the public for carrying on
substantially all of Lender’s business functions.
“ Effective Rate
” is the rate of interest calculated in accordance with
Section 2 herein.
“ Federal Funds Rate
” is, for any period, a fluctuating interest rate per annum
equal for each day during such period to the weighted average of
the rates on overnight Federal Funds transactions with members of
the Federal Reserve System arranged by Federal Funds brokers, as
published for such day (or, if such day is not a Business Day, for
the next preceding Business Day) by the Federal Reserve Bank of New
York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations for such day on such
transactions received by Lender from three (3) Federal Funds
brokers of recognized standing selected by Lender.
“ Fixed Rate ” is
the Applicable LIBO Rate as accepted by Borrower as an Effective
Rate for a particular Fixed Rate Period and Fixed Rate
Portion.
“ Fixed Rate Commencement
Date ” means the date upon which the Fixed Rate Period
commences.
“ Fixed Rate Notice
” is a written notice in the form shown on Exhibit B
attached to this Note which requests a Fixed Rate for a particular
Fixed Rate Period and Fixed Rate Portion.
“ Fixed Rate Period
” is the period or periods of (a) one (1), three
(3) or six (6) months; or (b) any other shorter
period which ends at the Maturity Date, which periods are selected
by Borrower and confirmed in the Fixed Rate Notice; provided that
no Fixed Rate Period shall extend beyond the Maturity Date and any
Fixed Rate Notice electing a Fixed Rate Period that would extend
beyond the Maturity Date shall be deemed to be a nullity and of no
force or effect.
Page 5 of 11