Exhibit 10.433

 

ALLSTATE LIFE INSURANCE COMPANY

ALLSTATE PLAZA SOUTH, SUITE G5C

NORTHBROOK, ILLINOIS 60062

 

December 23, 2004

 

Inland Western Longmont Fox Creek, L.L.C.

2901 Butterfield Road

Oakbrook, Illinois 60523

 

Re:      Allstate Life Insurance Company

            Loan No. 122561

            Fox Creek Village, 1601-1645 Pace Street

            Longmont, Colorado(the “Property”)

 

Ladies and Gentlemen:

 

Reference is made to our Commitment Letter dated December 17, 2004, as amended
(the “Commitment”) with respect to a $11,485,000 loan (the “Loan”) to be
evidenced by a Mortgage Note of even date herewith payable to Allstate Life
Insurance Company in the principal amount the Loan (the “Note”), and to be
secured by a Deed of Trust, Assignment of Leases, Rents and Contracts, Security
Agreement and Fixture Filing of even date herewith (the “Deed of Trust”)
encumbering the Property. Initially capitalized terms used but not otherwise
defined in this letter agreement (the “Letter Agreement”) have the same meanings
given them in the Deed of Trust.

 

In consideration of your execution and delivery of the documents evidencing,
securing or otherwise pertaining to the Loan (the “Loan Documents”), you (the
“Borrower”) and we (“Lender”) hereby agree as follows:

 

1.             Related Agreement. This Letter Agreement shall constitute a
Related Agreement

 

2.             Impounds. With regard to the provisions contained in Section 1.06
of the Deed of Trust requiring Borrower to deposit 1/12 of the annual amounts of
real estate taxes, regular and special assessments and insurance premiums,
Lender hereby agrees to defer collection of such monthly deposits for so long as
(a) Borrower is the sole fee simple owner of the Property; and (b) no Event of
Default exists under the Loan Documents and no condition or event exists which
with notice, the passage of time, or both, would constitute an Event of Default;
and (c) at Lender’s election, Borrower either pays for a tax reporting service
or Borrower promptly and consistently furnishes evidence that taxes and
insurance are being currently paid.

 

3.             Earthquake Insurance. With regard to the provisions contained in
Section 1.02 of the Deed of Trust requiring Borrower obtain earthquake insurance
coverage on the Property, Lender hereby agrees to waive such requirement until
such time as such coverage is available at commercially reasonable rates and in
Lender’s reasonable opinion such coverage is generally required by other
institutional lenders.

 

4.             Borrower’s Right to Transfer the Property.    Notwithstanding the
provisions contained in Section 1.08 and other applicable provisions of the Deed
of Trust, Borrower shall have a one time right, provided there is no Event of
Default or default or event which, with notice or the passage of time, or both,
could result in an Event of Default by Borrower under the Loan Documents, to
assign, sell or transfer all of the Property (the “Permitted Transfer”) to a

 

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party with experience, reasonably satisfactory to Lender, in managing property
similar to the Property and whose financial condition is reasonably satisfactory
to Lender (“Permitted Transferee”). The Permitted Transfer shall be further
conditioned upon:

 

(a)           the payment by Borrower to Lender of a transfer fee equal to one
percent of the outstanding principal balance of the Note (a nonrefundable $5,000
deposit toward such transfer fee shall be due at the time Borrower initially
requests a Permitted Transfer, the balance of the transfer fee shall be due on
the closing of the transaction);

 

(b)           the reimbursement of all of Lender’s expenses, including legal
fees, incurred in connection with the Permitted Transfer;

 

(c)           the Permitted Transferee and such general partners or principals
of Permitted Transferee as Lender may request, assuming, in form and substance
satisfactory to Lender, all obligations  of Borrower  under the  Loan 
Documents,  including,  without  limitation,  the Environmental Indemnity
Agreement and any nonrecourse exception indemnity agreement, with the same
degree of recourse liability as Borrower and subject to the same exculpatory
provisions;

 

(d)           Lender’s receipt of a title policy complying with the requirements
of the Commitment, updated to the date of the Permitted Transfer, evidencing
that such Permitted Transfer will not adversely affect Lender’s first and prior
lien on the Property or any other rights or interests granted to Lender under
the Loan Documents;

 

(e)           Lender’s receipt of opinions of counsel acceptable to Lender that
all previous opinions, pertaining to Borrower are true with respect to the
Permitted Transferee and the Permitted Transferee has duly assumed the Loan
Documents, and same are valid and enforceable against Permitted Transferee and
the Property; and that Borrower has the requisite power and authority to
properly transfer the Property;

 

(f)            the Property having maintained a Debt Coverage Ratio of not less
than 180 percent for the 12 month period ending 30 days before the date of the
Permitted Transfer and the Property having a projected Debt Coverage Ratio for
the next 12 months based on the most recently approved and certified financial
statements and annual rent roll of not less than 180 percent;

 

(g)           the Permitted Transferee paying to Borrower at least 40 percent
cash down payment on the date of the Permitted Transfer;

 

(h)           Lender’s receipt and approval of the purchase and sale contract
and copies of the proposed transfer documentation;

 

(i)            Lender’s receipt and approval of the Permitted Transferee’s
resume and financial statements; and

 

(j)            Lender’s receipt and approval of an updated MAI appraisal by an
appraiser satisfactory to Lender (prepared at Borrower’s expense) specifically
confirming a loan to value ratio of no more than 60 percent.

 

In addition, Borrower shall have the right, provided there is no Event of
Default or default or event which, with notice or the passage of time, or both,
could result in an Event of Default by Borrower under the Loan Documents, to
make a Permitted Transfer to INLAND

 

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WESTERN RETAIL REAL ESTATE TRUST, INC., a Maryland corporation (“Member”), the
sole member of Borrower, so long as (x) Borrower pays to Lender a transfer fee
equal to $5,000, (y) the Member assumes, in form and substance satisfactory to
Lender, all obligations of Borrower under the Loan Documents, including, without
limitation, the Environmental Indemnity Agreement, with the same degree of
recourse liability as Borrower and subject to the same exculpatory provisions,
and (z) the conditions and requirements set forth in subparagraphs 4(b), (d) and
(e) above are satisfied.

 

Net Operating Income shall be certified to be true and correct by the managing
general partner, manager or chief financial officer of Borrower.

 

5.             Right to Change Ownership Interests in Borrower. Notwithstanding
the provisions contained in Section 1.08 and other applicable provisions of the
Deed of Trust, so long as Member maintains its status as a Real Estate
Investment Trust (a “REIT”), any encumbrance, security interest or assignment or
transfer of ownership of all types and classes of the shares of Member shall not
constitute an improper encumbrance or transfer.

 

6              Damage to Property. With regard to the provisions contained in
Section 1.04(A) of the Deed of Trust requiring Borrower to notify Lender of
damage to the Property, the cost threshold for notification shall be increased
to One Hundred Thousand Dollars ($100,000). With regard to the provisions
contained in Section 1.04(B) and 1.04(C) of the Deed of Trust regarding the
estimated cost of restoration, the threshold amounts shall be increased to Two
Hundred Fifty Thousand Dollars ($250,000).

 

7.             Insurance.   Lender hereby approves the insurance evidenced by
the certificates attached as Exhibit A hereto.

 

8.             Property Manager. Lender hereby approves Inland Southwest
Management LLC, as manager of the Property, subject to its execution of the
letter attached as Exhibit B hereto.

 

9.             Red Bug Loan.   In connection with the Loan, INLAND WESTERN
WINTER SPRINGS RED BUG, L.L.C., a Delaware limited liability company
(“Affiliated Borrower”), an affiliate of Borrower has applied to Allstate for a
loan to be evidenced and secured by (a) a Mortgage Note from Affiliated Borrower
to Lender (the “Other Note”), (b) a Mortgage, Assignment of Leases, Rents and
Contracts, Security Agreement and Fixture Filing of even date herewith (the
“Other Mortgage”) encumbering certain real property owned by Affiliated Borrower
and the respective improvements thereon and personal property associated
therewith located in Winter Springs, Seminole County, Florida, as described in
the Other Mortgage (the “Other Property”), and (c) the Related Agreements
defined in the Other Mortgage (collectively and as the same may be amended,
modified or supplemented from time to time, the “Other Loan Documents”).  
Borrower acknowledges and agrees that Lender is making the Loan with the
understanding that the Loan will also be secured by the Other Mortgage and that
an Event of Default under either the Loan Documents or the Other Loan Documents
shall constitute an Event of Default under both the Loan and the Other Loan.  
In connection with the Other Loan, Borrower shall execute an Amendment to Loan
Documents to be recorded in Boulder County, Colorado,  and any other
documentation necessary to ensure that the loans arc “cross- collateralized” and
“cross-defaulted”.

 

10.           Rights Personal to Borrower.    This Letter Agreement shall be
binding upon Borrower and its successors and assigns, except that the rights
granted to Borrower in this Letter Agreement shall be personal to Borrower and
shall not inure to the benefit of any subsequent

 

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owner of the Property. In the event Lender transfers all or any part of the Loan
or any interest in the Loan Documents to any other person or entity, Lender
agrees to notify such transferee(s) of the existence of this Letter Agreement
and the fact that it is binding upon Lender’s successors and assigns by
delivering such transferee(s) a true, correct and complete copy of this Letter
Agreement concurrently with such transfer accompanied by a letter of transmittal
from Lender advising such transferee(s) of the binding nature of the provisions
of this Letter Agreement. Lender will send a copy of its letter of transmittal
and the enclosure to Borrower, and Borrower’s name will be shown on the face of
the original letter of transmittal as an addressee thereof.

 

*           *           *           *           *

 

[Signature Page Follows]

 

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Very truly yours,

 

 

 

ALLSTATE LIFE INSURANCE COMPANY,

an Illinois insurance corporation

 

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

By:

 

 

 

          Its Authorized Signatories

 

 

 

Accepted and agreed:

 

 

 

INLAND WESTERN LONGMONT FOX CREEK, L.L.C.,
a Delaware limited liability company

 

 

 

By:

INLAND WESTERN RETAIL REAL ESTATE
TRUST, INC., a Maryland corporation,
Its sole member

 

 

By:

/s/ [ILLEGIBLE]

 

 

 

Its:

Asst. Secretary

 

Dated: December 23, 2004

 

 

 

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EXHIBIT A

 

INSURANCE CERTIFICATES

 

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EXHIBIT B

 

PROPERTY MANAGER LETTER

 

INLAND SOUTHWEST MANAGEMENT LLC

 

December 23, 2004

 

Inland Western Longmont Fox Creek, L.L.C.

290l Butterfield Road

Oakbrook, Illinois 60523

 

Re:      Allstate Life Insurance Company

            Loan No. 122561

            Fox Creek Village, 1601-1645 Pace Street

            Longmont, Colorado (the “Property”)

 

Ladies and Gentlemen:

 

The undersigned (“Manager”) is the current property manager of the Property
pursuant to that certain Management Agreement (the “Agreement”) dated as of
November 22, 2004, by and between INLAND WESTERN LONGMONT FOX CREEK, L.L.C., a
Delaware limited liability company (“Owner”) and Manager. In consideration of
your making the Loan to Owner (Manager being an affiliate of Owner), Manager
acknowledges and agrees to the following:

 

1.                                       Allstate, in its sole discretion, may
terminate the Agreement by notice to Manager upon acquisition by Allstate of
title to the Property by foreclosure, deed in lieu of foreclosure, or other
transfer of the Property or upon Allstate otherwise obtaining possession of the
Property by any lawful means. Upon the appointment of a receiver or court
appointed officer, either Allstate or such receiver or officer may terminate the
Agreement in its sole discretion by notice to Manager.

 

2                                          Manager waives any right to create a
lien against the Property to secure payment of unpaid management fees.

 

3.                                       Upon the occurrence of, and during the
continuation of, a default under any of the documents evidencing the Loan which
has not been cured in Allstate’s sole judgment, all management fees paid or
payable to Manager thereafter shall be subordinate to amounts owed to Allstate
under such Loan documents.

 

 

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4.                                       Upon the occurrence of, and during the
continuation of, a default under any of the documents evidencing the Loan which
has not been cured in Allstate’s sole judgment, all management fees and other
sums received by Manager thereafter in connection with management of the
Property shall be held in trust for the benefit of Allstate.

 

5.                                       Until Allstate elects to terminate the
Agreement as provided herein, Manager will perform all of its obligations,
covenants, conditions and agreements under the Agreement for the benefit of
Allstate and its successors and assigns, so long as Allstate performs the duties
and obligations of Owner under the Agreement accruing after the date Allstate
exercises its rights under the Deed of Trust.

 

 

INLAND SOUTHWEST MANAGEMENT LLC

 

 

 

 

 

By:

 

 

 

 

Its

 

 

 

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