ALLONGE
TO UNSECURED PROMISSORY NOTE
Effective as of
April 16, 2018, that certain Promissory Note, bearing a dated date
of March 30, 2017, made by HC Government Realty Holdings, L.P. and
payable to Baker Hill Holdings, LLC in the original principal
amount of $2,770,000.00, a specimen copy of which is attached
hereto as Exhibit A
(the “HCGRH Unsecured
Note”) is amended, as follows:
The
“Maturity Date”, as defined in the HCGRH Unsecured Note
is changed to, and the HCGRH Unsecured Note is amended to provide
that, the Maturity Date thereof is May 1, 2019, and if all
principal and accrued interest has not been paid and satisfied in
full on or before such date, then and in such event the outstanding
principal balance of this Note from and after such date shall bear
interest at the rate of fifteen percent (15.0%) per annum until
paid and satisfied in full.
The
undersigned holder of the HCGRH Unsecured Note hereby certifies
that he, she or it is the holder of the HCGRH Unsecured Note, which
is free and clear of any encumbrances and has not been assigned,
pledged, hypothecated or otherwise transferred in whole or in part
by the undersigned, who or which consents to the change and
amendment made hereby.
MAKER:
HC
GOVERNMENT REALTY HOLDINGS, L.P.
By: HC
Government Realty Trust, Inc.
Its:
General Partner
By:
/s/ Robert R.
Kaplan
Its:
Authorized Signatory
HOLDER:
BAKER
HILL HOLDINGS, LLC
By:
/s/ Philip
Kurlander
Its:
Manager
This
Allonge shall be deemed to be, and shall be a part of, the HCGRH
Unsecured Note whether or not physically attached
thereto.
UNSECURED
PROMISSORY NOTE
Sarasota,
Florida
$2,770,000.00
March 30, 2017
FOR
VALUE RECEIVED, HC Government Realty Holdings, L.P., a Delaware
limited partnership (“Borrower”),
promises to pay to the order of Baker Hill Holding, LLC, a New York
limited liability company (the “Lender”),
the principal amount of Two Million Seven Hundred-Seventy Thousand
and 00/100 U.S. Dollars ($2,770,000.00), plus interest on the
balance remaining from time to time unpaid in like money at the
rate Twelve percent (12.00%) per annum, (the “Rate”).
Accrued interest at the Rate will be calculated on the basis of a
360-day year and shall be paid monthly in arrears for the actual
number of days elapsed, the first such
interest payment being due and payable on May 1, 2017 and
thereafter on the first day of each succeeding month (if the first
day of any such month is not a business day, which is a weekday
that is not a holiday and on which financial institutions and other
deposit gathering institutions in the Borough of Manhattan, City
and State of New York are open for business generally, then the
interest payment otherwise due on such first day of the month shall
be paid on the next succeeding business day) through and including
March 27, 2018 (the “Maturity
Date”), on which date, if
not sooner paid, as hereinafter provided, the entire outstanding
principal balance of this Promissory Note (this
“Note”),
together with accrued but unpaid interest thereon, shall become and
be due and payable in full.
1. Prepayment.
At any time on or after One Hundred Eighty (180) days next
following the dated date of this Note, Borrower may prepay the
outstanding principal balance of this Note, notwithstanding
anything to the contrary contained herein, in whole or in part,
together with any interest accrued on the outstanding principal
balance hereof at the Rate that is unpaid to the time of
prepayment, at any time on or after such One Hundred Eightieth
(180th)
day but before the Maturity Date without penalty or premium of any
kind. All payments made under this Note shall be applied first to
accrued and unpaid interest and then to principal.
2. Default.
Each of the following shall constitute an “Event of
Default” hereunder:
(a) Failure
by Borrower to pay any principal of, or interest on, the
Note when due, whether at maturity or by reason of acceleration
following a default or otherwise, which default is not cured by
Borrower on or before the expiration of ten (10) days after the due
date therefor; or
(b) Breach
of any of Borrower’s representations, warranties or covenants
contained herein, which default is not cured by Borrower on or
before the expiration of thirty (30) days after written notice from
Lender.
3.
Remedies. Upon the occurrence of an
Event of Default hereunder and at any time thereafter, the Lender
may declare the entire outstanding principal balance of this Note
and all accrued but unpaid interest thereon to be immediately due
and payable without presentment, demand, protest, notice of
dishonor or any other notice of any kind (except as otherwise
expressly provided herein). The rights and remedies of Lender
following the occurrence of an Event of Default hereunder shall be
cumulative, and no failure or delay by Lender in exercising any
such right or remedy shall be deemed a waiver thereof or of any
other right or remedy which Lender may have against Borrower,
whether at law, in equity or by statute.
4.
Miscellaneous.
(a) Governing
Law; Consent to Jurisdiction and Venue. This Note shall be
construed and enforced under the laws of the State of Delaware
applicable to contracts to be wholly performed therein. Borrower
and Lender (by accepting this Note) irrevocably consent to the
jurisdiction of the state and federal courts sitting in or for the
City of Wilmington, Delaware, for any litigation instituted against
Borrower by Lender which arises out of, or is in any way connected
with, this Note. Borrower and Lender (by accepting this Note)
further agree that venue for any such action shall lie exclusively
with such courts sitting in the City of Wilmington, Delaware,
unless Borrower and Lender otherwise agree in writing.
(b)
Loss of Note. Upon
receipt of evidence satisfactory to Borrower of the loss, theft,
destruction or mutilation of this Note, and of indemnity reasonably
satisfactory to Borrower if lost, stolen or destroyed, and upon
surrender and cancellation of this Note if mutilated, Borrower
shall execute and deliver to Lender a new Note of like date, tenor
and denomination.
(c) Waiver
of Presentment, Etc. Borrower waives presentment, demand,
notice, protest and all other demands and notices in connection
with the delivery, acceptance, performance, default or enforcement
of this Note, and assents to any extension or postponement of the
time of payment or any other indulgence, to any substitution,
exchange or release of collateral available to Lender, if any, and
to the addition or release of any other party or person primarily
or secondarily liable.
(d)
Amendment.
This
Note may only be amended or modified by an instrument in writing
subscribed by the Lender and the Borrower.
(e)
Notices. Any
notices required to be given under the terms of this Note shall be
given in writing by United States certified or registered mail,
postage prepaid, return receipt requested, by email, or by
overnight private courier, addressed to the party to be served at
the address below:
If to
Borrower:
|
HC Government
Realty Holdings, LP
c/o
HC Government Realty Trust, Inc.,
General Partner
Attention:
Edwin M. Stanton, CEO
1819
Main Street
Suite
212
Sarasota,
Florida 34236
E-mail:
estanton@holmwoodcapita.co
|
If to Lender:
|
Baker Hill
Holdings, LLC
c/o
Dr. Philip Kurlander
54
Phipps Lane
Plainview,
New York 11803
Email:
pkurlander@holmwoodcapital.com
|
(g)
Section References.
The section references contained in this Note are for reference
purposes only and shall not influence the interpretation or
construction of this Note.
5.
Subordination. The payment of principal
of, and interest on, this Promissory Note is subordinated in all
respects to that certain $10,875,000.00 First Mortgage Loan (the
“First Mortgage
Loan”) from Park Sterling Bank (“Park
Sterling”) to GOV Norfolk, LLC, a Delaware limited
liability company (“GOV
Norfolk”), an entity wholly-owned by the Borrower,
which First Mortgage Loan is made of even date herewith, and which
First Mortgage Loan is secured by, among other things, a first and
prior lien on and security interest in, that certain real property
and improvements thereon located at 5850 Lake Herbert Drive,
Norfolk, Virginia (collectively, the “Property”).
Notwithstanding anything to the contrary contained in this Note,
the Borrower may make payments to Lender on the terms and
conditions set forth in this Note until such time as GOV Norfolk
receives written notice from Park Sterling that it is in default
under the First Mortgage Loan, or facts exist, which with the
giving of notice, the passage of time, or both, will result in a
default by GOV Norfolk under the First Mortgage Loan. Additionally,
Borrower will not repay this Note with the proceeds of replacement
financing without first obtaining the consent of Park Sterling,
which consent will not be unreasonably
withheld.
(Signature
Follows)
IN
WITNESS WHEREOF, Borrower has executed this Note effective as of
the date and year first above written.
BORROWER:
HC
Government Realty Holdings, L.P., a
Delaware limited
partnership
By:
HC
Government Realty Trust, Inc
Its: General Partner
By: /s/ Robert R
Kaplan
Name: Robert R Kaplan
Its: Authorized Signatory
(Signature Page to
$2,770,000 Note Made in Favor of Baker Hill Holdings,
LLC,
a New
York Limited Liability Company, as Lender)