Exhibit 10.25
LOAN NUMBER 101076
PROMISSORY
NOTE
$23,000,000.00
Wilmington, North
Carolina
March 29, 2007
FOR VALUE RECEIVED,
the undersigned, CAPITOL HOTEL
ASSOCIATES, L.P., L.L.P., a Virginia limited liability limited
partnership, doing business in North Carolina as Capitol Hotel
Associates, Limited Partnership, L.L.P., promises to pay to the
order of MONY LIFE INSURANCE COMPANY, a New York corporation
(“Holder”), at its office at 1290 Avenue of the
Americas, New York, New York 10104, or at such other place as the
Holder may from time to time designate in writing, the principal
sum of Twenty-Three Million and 00/100 Dollars (
$23,000,000.00 ), with interest thereon from the date or
dates of disbursement of the aforesaid principal sum at the rate of
6.21% per annum, to be paid in lawful money of the United
States of America as follows:
In one hundred twenty
(120) successive monthly installments payable on the first day
of each calendar month commencing on the first day of the second
month following the date of disbursement, the first twenty-four
(24) installments to be in the amount of One Hundred Nineteen
Thousand Twenty-Five and NO/100 Dollars ($119,025.00) each and
consisting of interest only on the outstanding principal sum, the
next ninety-five (95) installments thereof to be in the amount
of One Hundred Fifty-One Thousand One Hundred Fifty-Five and 77/100
Dollars ($151,155.77) each and applied first to interest on the
unpaid principal sum and the balance to be applied to the principal
sum, with interest to be calculated on the basis of a 360 day year
with 12 months of 30 days each, and the last installment to be in
the amount of the entire outstanding principal balance and accrued
interest thereon. The undersigned acknowledges that there will be a
substantial principal payment due upon maturity and that Holder
shall have no obligation, expressed or implied, to refinance the
same. Interest from the date of disbursement hereof to the first
day of the next month shall be paid together with the first regular
installment of interest hereunder, to the extent not collected at
closing.
The undersigned
shall have no right to prepay, in whole or in part, the principal
sum hereof, except the undersigned shall have the right to prepay
in whole (but not in part) the principal sum hereof, together with
accrued interest thereon, on any date for the payment of interest
hereunder during the sixth (6 th
) loan year
(as hereinafter defined) and thereafter, provided that
(a) there shall exist no Event of Default under the provisions
of the Deed of Trust, (b) the Holder hereof shall have
received at least thirty (30) days prior written notice of
prepayment which notice shall be irrevocable, and (c) the
prepayment shall be accompanied by a fee (the “Prepayment
Fee”) (which the undersigned agrees is a fair and reasonable
method to compensate Holder for its loss of the benefits of this
loan transaction) equal to the greater of (1) one percent
(1%) of the amount being prepaid, or (2) an amount
computed as follows: (i) the product of the outstanding
principal loan balance on the prepayment date (designated as
“P” in the formula below) and the amount by which 6.29%
(i.e., the interest rate of 6.21% as adjusted for semi-annual
payments) exceeds the Base Rate (the yield rate as of the
prepayment date for a United States of America treasury obligation
having a maturity
date substantially contemporaneous with the loan
maturity date, designated as “b” in the formula below)
shall be divided by two to determine the semi-annual excess of
earned interest at the interest rate payable pursuant to the note
over the Base Rate, and (ii) the semi-annual excess of earned
interest shall be discounted to its present value determined with
reference to the number of semi-annual periods then remaining in
the loan term (the number of months then remaining in the loan term
divided by six and rounded up to the nearest whole number
(designated as “n” in the example below) and one-half
the Base Rate (to account for the fact the payments are made
semi-annually). The formula for computing the prepayment fee
is:
[GRAPHIC APPEARS
HERE]
For purposes of establishing the
Base Rate, there shall be utilized the yield to maturity on
appropriate (as determined solely by the Holder hereof) U.S.
Treasury obligations, either U.S. Treasury Notes or Bills, having
maturity dates closest to the maturity date of this Note, as quoted
in the Wall Street Journal, or if not so quoted, in some other
reputable publication selected by the Holder hereof, on the fifth
(5th) business day prior to the date of prepayment. The
Prepayment Fee shall be calculated by Holder and shall be binding
on the undersigned absent manifest error. Notwithstanding the
foregoing, the undersigned may prepay, without premium or charge,
the whole (but not a part) of the principal sum hereof, on any
business day during the final ninety (90) days of the term
hereof, provided that the Holder hereof shall have received at
least ten (10) business days prior written notice of such
prepayment.
The undersigned agrees that the
prepayment fee set forth herein, including the amount and method of
calculation, fairly and reasonably compensates Holder for its loss
of the benefits of this loan transaction and is consistent with
generally accepted lending practices in the state of North
Carolina. If such prepayment fee is determined to be unreasonable
or otherwise unenforceable by a court of competent jurisdiction,
then the undersigned agrees to pay a reduced prepayment fee equal
to the maximum amount permitted under applicable law.
The term “loan year” is
defined as any period of one year commencing on the date for the
payment of the first installment hereunder or on any anniversary of
such date.
If the maturity of
this Note is accelerated as a result of an Event of Default under
the provisions of the Deed of Trust, the Holder will be damaged
because of its loss of the benefits of this loan transaction.
Holder and the undersigned acknowledge that different methods could
be used to calculate Holder’s damages, but to avoid any
dispute, the undersigned agrees to pay as fair and reasonable
compensation to Holder an acceleration fee in an amount equal to
(1) the Prepayment Fee, or (2) if such acceleration
occurs prior to the sixth (6 th
) loan year,
the greater of two percent (2%) of the outstanding principal
amount due hereunder or one hundred twenty five percent
(125%) of the Prepayment Fee (with the Prepayment Fee computed
using the formula applicable during the sixth (6
th
) loan
year).
- 2 -
The whole of the principal sum and
interest shall become due and payable at the option of the Holder
hereof upon the occurrence of an Event of Default under the
provisions of the Deed of Trust (all of the terms and provisions of
such Deed of Trust being hereby incorporated herein by reference),
together with (to the extent permitted under applicable law) costs
of collection and attorneys’ fees incurred by the Holder
hereof in collecting or enforcing payment thereof, including all
costs associated with the default, any workout negotiations,
foreclosure and bankruptcy, whether or not suit is filed. The whole
of the principal sum and, to the extent permitted by law, any
accrued interest shall bear interest from and after maturity,
whether or not resulting from acceleration, at a rate per annum
equal to four percent (4.0%) plus the interest rate which
would be in effect hereunder absent such maturity (the
“Default Interest Rate”).
In the event that any installment of
interest or interest and principal due under this Note shall not be
paid for a period of fifteen (15) days after the same shall
become due and payable, a late charge of four cents ($.04) for each
one dollar ($1.00) so overdue may be charged by Holder for the
purpose of defraying the expense incident to handling such
delinquent payment. Time is of the essence of this Note.
The undersigned acknowledges that
such late charge is fair liquidated compensation to the Holder for
the time and expense of dealing with delinquent payments. If such
payment shall not be made for fifteen (15) days after the same
becomes due and payable, in addition to the late charge provided
for above, interest shall be payable on the whole of the principal
sum at the Default Interest Rate for the subsequent duration of
such default, whether or not there has been an acceleration
o
