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HomeMy WebLinkAboutCAG2001-0499 - Original - King County - Promissory Note - 02/09/2001 PROMISSORY NOTE $9,000,000.00 February 9, 2001 Seattle,Washington FOR VALUE RECEIVED, the undersigned, CITY OF KENT, a Washington municipal corporation, promises to pay to the order of KING COUNTY, a Washington municipal corporation, at its Office of Regional Policy and Planning, King County Courthouse, 516 Third Avenue, Room 402, Seattle, Washington 98104, or such other place as the holder of this Note may from time to time designate, the principal sum of NINE MILLION AND NO/100 DOLLARS ($9,000,000.00), or so much thereof as may from time to time be outstanding hereunder,together with interest on the unpaid balance of principal. Interest shall be at the rate of four percent (4%) per annum, calculated on the basis of a 365-day calendar year from February 9, 2001 until June 30, 2002 and two percent (2%)per annum, calculated on the basis of a 365-day calendar year after July 1, 2002. Interest shall be calculated for each day all or any part of the principal balance hereof shall remain outstanding. This Note shall be payable as follows: On the first(0) day of August, 2001, and on the first(P)day of every sixth calendar month thereafter,the undersigned shall pay to Lender all interest which has accrued during the previous six calendar months. In the event interest is not paid when due, the undersigned shall be in default and the interest that has not been paid when due shall be compounded by adding said unpaid interest to the principal balance hereof and thereafter said unpaid interest shall bear interest at the same rate as the unpaid balance hereof Notwithstanding the foregoing payment provisions to the contrary, the principal balance outstanding hereon,together with all accrued and unpaid interest and any other sums due hereunder, shall be due and payable in full on the earlier of(i) demand by the holder hereof(said demand to be made as set forth below) and (ii) August 1, 2003. Notwithstanding the foregoing, the holder of this Note shall have the absolute right to demand partial repayments of the principal balance of this Note not more often than once per calendar week nor five (5) times per calendar month (said demands to be made as set forth below). Demands for partial repayment may be made by the holder of this Note when funds are needed by the holder of this Note to pay for regular block grant activities. Provided that the undersigned shall first give the holder of this Note thirty (30) calendar days' prior notice, the indebtedness evidenced hereby may be prepaid in whole or in part from time to time without premium or penalty. Should default be made in any payment when due or in the performance or observance of any of the covenants and agreements of this Note, then, after the expiration of any applicable cure period, if any, the whole sum of principal and interest shall become immediately due and payable at the option of the holder. Failure to exercise such option shall not constitute a waiver of the right to exercise it in the event of a continuing or subsequent default. This Note is issued pursuant to and is entitled to the benefits of the Loan Agreement. An Event of Default under the Loan Agreement shall be deemed a default hereunder, whereupon the holder may at its option declare all sums as are then outstanding hereunder immediately due and payable. This Note shall be secured by an unconditional, irrevocable Direct Pay Letter of Credit, payable upon demand, issued by a banking institution approved by the holder of this Note (the "Direct Pay Letter of Credit"), all as more fully set forth in the Loan Agreement. Upon the sale, transfer or assignment, whether voluntary, involuntary or by operation of law, of all or substantially all of the "Project" (described in the Loan Agreement), then at its sole option the holder hereof may, by written notice to the undersigned, declare all sums as are then outstanding hereunder to be immediately due and payable. Notwithstanding the foregoing, Maker shall have the right to grant a deed of trust or mortgage in favor of the issuer of the Direct Pay Letter of Credit to secure Maker's obligations to the issuer in connection with its issuance of the Direct Pay Letter of Credit. As set forth above, the holder of this Note may demand partial repayments of principal from the undersigned for regular block grant activities. The holder of this Note shall make demand for partial repayments of principal upon the undersigned, in writing, by delivering or mailing said demand to the undersigned in the manner and at the address set forth in Section 7.3 of the Loan Agreement. The partial repayment of principal shall be due and payable on or before ten (10) days, excluding Saturdays, Sundays and legal holidays, from the date the undersigned receives or is deemed to have received the demand. In the event the holder of this Note fails to receive a partial repayment within said ten (10) day period, the holder of this Note shall have the right to draw upon the Direct Pay Letter of Credit without any further condition. As set forth above, this Note shall be due and payable in full upon demand. The holder of this Note shall make demand upon the undersigned, in writing, by delivering or mailing said demand to the undersigned in the manner and at the address set forth in Section 7.3 of the Loan Agreement. All principal, accrued interest and other charges due under this Note or the Loan Agreement shall be due and payable ten (10) days, excluding Saturdays, Sundays and legal holidays, from the date the undersigned receives or is deemed to have received the demand and the holder of this Note may, on said tenth (10) day or at any time thereafter, draw from the Direct Pay Letter of Credit all sums, including principal, accrued interest and other charges, necessary to fully satisfy the Note. Except for the demands described above, the undersigned hereby waives diligence, demand, presentment for payment, and notice of whatever kind or nature. Without discharging or in any way affecting the liability of the undersigned, the undersigned hereby consents to any and all extensions of this Note as the holder hereof may in its sole discretion grant from time to time, to the release of all or any part of the security for the payment hereof and to the release of any party liable for repayment of the obligations hereunder. 2 46247\04306\215341 V01 DNL All payments due on this Note shall be payable in lawful money of the United States of America at the time of payment, and shall be made to the holder at the address first hereinabove indicated, or such other address as the holder may hereafter designate. This Note shall be governed by the laws of the State of Washington, except to the extent that Federal laws may preempt the laws of the State of Washington. In the event that this Note is placed in the hands of an attorney at law for collection after maturity or upon default or in the event that proceedings at law or in equity are instituted in connection herewith, or in the event that this Note is placed in the hands of an attorney at law to enforce any of the rights or the agreements contained herein or in the Loan Agreement, the undersigned shall pay all costs of the holder hereof in collecting or attempting to collect this Note or protecting or enforcing such rights, including, without limitation, reasonable attorney's fees; and all such amounts shall be deemed to be secured by, and may be drawn from, the Direct Pay Letter of Credit. This Note and the Loan Agreement are by this reference subject to the limitation that in no event shall interest or any other amount paid or agreed to be paid to King County for the use, forbearance or detention of money to be advanced hereunder or pursuant to the Loan Agreement exceed the highest lawful rate permissible under applicable usury laws. If fulfillment of any provision hereof or of the Loan Agreement shall be deemed by a court of competent and final jurisdiction to violate any applicable usury restrictions, then Soso facto, the obligation to be fulfilled shall be reduced to the limmt of such validity, and any amount received in excess of such limit shall be applied to reduce the unpaid principal balance hereof and not to the payment of interest. Time is of the essence of this Note and of each and every provision hereof. IN WITNESS WHEREOF, the undersigned have executed this Promissory Note as of the date first above written. CITY OF KENT, a Washington municipal corporation Attest: � c By: Its: (AK'ViOtl MA Its: 3 462471043061215341 V01 DNL