Exhibit 10.2

First Amended and Restated
SECURED PROMISSORY NOTE

$27,450,000.00 September 30, 2016

1.       FOR VALUE RECEIVED, IRESI Frederick Market Square, L.L.C., a Delaware
limited liability company (“Borrower”), hereby promises to pay, to the order of
PARKWAY BANK AND TRUST COMPANY, an Illinois banking corporation (“Lender”),
having a principal place of business and post office address at 4800 N. Harlem
Avenue, Harwood Heights, IL 60706, or at such other place as Lender may
designate, the principal sum of TWENTY-SEVEN mILLION FOUR hundred fifty Thousand
and 00/100 Dollars ($27,450,000.00) (the “Loan Amount”) or so much thereof as
shall from time to time have been advanced, together with interest on the unpaid
balance of said sum from September 30, 2016 (the “Closing Date”), at the fixed
rate of three and 64/100ths percent (3.64%) per annum (the “Interest Rate”). Any
amount payable hereunder which is not paid when due shall, at Lender’s election,
bear interest at a rate equal to the Interest Rate plus three percent (3%) per
annum (the “Default Rate”).

 

This First Amended and Restated Secured Promissory Note (this “First Amended
Note”) is issued, in part, in exchange and replacement for, and evidences the
same indebtedness incurred to the date hereof under that certain Secured
Promissory First Amended Note dated as of September 30, 2015 from Borrower to
Lender in the original principal amount of Forty-five mILLION seven hundred
fifty Thousand and 00/100 Dollars ($45,750,000.00) (the “Initial Note”). The
indebtedness evidenced by the Initial Note is continuing indebtedness, and
nothing in this Note shall be deemed to constitute a payment, settlement, or
novation of the Initial Note, or the release of, or otherwise adversely affect,
any lien, mortgage, or security interest securing such indebtedness or any
rights of Lender against the undersigned, or any Guarantor of the Initial Note
or this Note. All of the obligations of Borrower shall, from and after execution
and delivery of this First Amended Note by Borrower, continue in full force and
effect as set forth herein. Any interest accrued and unpaid on such Initial Note
as of the date hereof will be included in the next monthly payment due
hereunder, and any interest adjustment payments or credits accrued on such
Initial Note as of the date hereof will be included in calculation of the next
interest adjustment payment or credit due hereunder.

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2       Interest on this First Amended Note shall be calculated in arrears on
the basis of a 360-day year and the actual number of days elapsed in any portion
of a month in which interest is due. Beginning on October 30, 2016, and
continuing on the last day of each successive month thereafter until the
Maturity Date (as defined below), Borrower shall pay to Lender consecutive
monthly payments of interest only through September 30, 2021 and thereafter
shall make consecutive monthly payments of principal based on a 30-year
amortization schedule, together with interest accrued at the Interest Rate. All
outstanding principal of and accrued and unpaid interest to and including the
date of payment and other Indebtedness shall be due and payable in full on
September 30, 2023, or such earlier date resulting from the acceleration of the
Indebtedness by Lender (“Maturity Date”). All principal and interest shall be
paid without setoff, counterclaim, or deduction of any kind, in lawful money of
the United States of America by automated clearinghouse transfer through such
bank or financial institution as shall be approved in writing by Lender, shall
be made to an account designated by Lender, and shall be initiated by Lender or
shall be made in such other manner as Lender may direct from time to time. Any
other monthly deposits or payments Borrower is required to make to Lender under
the terms of the Loan Documents (as defined in the Loan Agreement defined below)
shall be made by the same payment method and on the same date as the
installments of interest due under this First Amended Note. This First Amended
Note is the Note referred to in that certain Loan Agreement of even date
herewith (as amended form time to time the “Loan Agreement”), by and between
Lender and Borrower. Capitalized terms used and not otherwise defined herein
shall have the meanings ascribed to them in the Loan Agreement.

3.       Borrower may prepay the principal of this First Amended Note in whole
or part prior to the Maturity Date without premium or penalty in accordance with
the provisions of the Loan Agreement. Time is of the essence with respect to the
payment of this First Amended Note.

4.       If any payment of principal, interest, or other Indebtedness is not
made when due, damages will be incurred by Lender, including additional expense
in handling overdue payments, the amount of which is difficult and impractical
to ascertain. Borrower therefore agrees to pay, upon demand, to the extent
permitted by law, the sum of five cents ($.05) for each one dollar ($1.00) of
each said payment that becomes overdue (“Late Charge”) as a reasonable estimate
of the amount of said damages, subject, however, to the limitations contained in
Paragraph 5 hereof, and provided that no late charge shall be assessed for any
payment due on or after the Maturity Date.

Further, notwithstanding the hereinabove or anything in the Loan Documents to
the contrary, no Late Charge shall be incurred by or assessed against Borrower
with respect to amounts as to which interest at the Default Rate accrues.

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5.       If any Event of Default has occurred and is continuing under the Loan
Documents, the entire principal balance of the Loan, interest then accrued, and
all other Indebtedness whether or not otherwise then due, shall, at Lender’s
option, become immediately due and payable without demand or notice, and whether
or not Lender has exercised said option, interest shall accrue on the entire
principal balance, interest then accrued, and any other Indebtedness then due,
at a rate equal to the Default Rate until fully paid. Notwithstanding the
foregoing, in the case of any Event of Default specified in Section 4.1(B) of
the Loan Agreement with respect to the Borrower or any guarantor, including the
Guarantor, without any notice to Borrower or any other act by Lender, the entire
principal balance of the Loan, interest then accrued, and all other Indebtedness
whether or not otherwise then due, shall become immediately and automatically
due and payable without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by Borrower, and Borrower will pay the
same.

6.       Borrower agrees that Lender has all rights of set-off and bankers’ lien
provided by applicable law, and, in addition thereto, Borrower agrees that at
any time any Event of Default exists, Lender may apply to the payment of any
obligations of Borrower, whether or not then due, any and all balances, credits,
deposits, accounts or moneys of Borrower then or thereafter with Lender.

7.       Notwithstanding anything herein or in any of the other Loan Documents
to the contrary, no provision contained herein or therein that purports to
obligate Borrower to pay any amount of interest or any fees, costs or expenses
that are in excess of the maximum permitted by applicable law shall be effective
to the extent it calls for the payment of any interest or other amount in excess
of such maximum. All agreements between Borrower and Lender, whether now
existing or hereafter arising and whether written or oral, are hereby limited so
that in no contingency, whether by reason of demand for payment or acceleration
of the maturity hereof or otherwise, shall the interest contracted for, charged
or received by Lender exceed the maximum amount permissible under applicable
law. If, from any circumstance whatsoever, interest would otherwise be payable
to Lender in excess of the maximum lawful amount, the interest payable to Lender
shall be reduced to the maximum amount permitted under applicable law; and if
from any circumstance Lender shall ever receive anything of value deemed
interest by applicable law in excess of the maximum lawful amount, an amount
equal to any excessive interest shall, at Lender’s option, be refunded to
Borrower or be applied to the reduction of the principal hereof, and not to the
payment of interest or, if such excessive interest exceeds the unpaid balance of
principal hereof such excess shall be refunded to Borrower. This paragraph shall
control all agreements between Borrower and Lender.

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8.       Borrower and any endorsers or guarantors waive presentment, protest and
demand, notice of protest, demand and dishonor and nonpayment, and agree the
Maturity Date of this First Amended Note or any installment may be extended
without affecting any liability hereunder, and further promise to pay all
reasonable costs and expenses, including but not limited to, reasonable
attorney’s and paralegal’s fees incurred by Lender in connection with any
default or in any proceeding (whether incurred in any trial, appellate,
bankruptcy, condemnation or any other proceeding) to interpret and/or enforce
any provision of the Loan Documents. No release of Borrower from liability
hereunder shall release any other maker, endorser or guarantor hereof.

9.       This First Amended Note is secured by the Loan Documents, including,
without limitation, the instruments described on Schedule I attached to and made
a part of this First Amended Note. In no event shall such documents be construed
inconsistently with the terms of this First Amended Note, and in the event of
any discrepancy between any such documents and this First Amended Note, the
terms of this First Amended Note shall govern. The proceeds of this First
Amended Note are to be used for business, commercial, investment or other
similar purposes, and no portion thereof will be used for any personal, family,
or household use. This First Amended Note shall be governed by and construed in
accordance with the laws of the State of Illinois, without regard to its
conflict of law principles.

10.       Except as permitted pursuant to the Deed of Trust described in
Schedule I, and as permitted by the Loan Agreement, any sale, conveyance or
transfer of any right, title or interest in the Premises or any portion thereof,
or any other violation of any provisions of the Loan Agreement or the Deed of
Trust with respect to any transfers of the Premises without the prior written
consent of Lender, shall, at the option of Lender, constitute an Event of
Default hereunder and upon any such Event of Default Lender may declare the
entire indebtedness evidenced by this First Amended Note to be immediately due
and payable and foreclose the Deed of Trust securing this First Amended Note
immediately or at any time after such Event of Default occurs. The acceptance of
any payment due hereunder after any sale, transfer or assignment shall not be
deemed as the consent of Lender to a sale, transfer or assignment.

11.       If this First Amended Note is executed by more than one party, all
references herein to Borrower shall be deemed to each such party, individually
and collectively, and the obligations and liabilities of each Borrower under
this First Amended Note shall be joint and several and shall be binding upon and
enforceable against each Borrower and their respective successors and assigns.
This First Amended Note shall inure to the benefit of and may be enforced by
Lender and its successors and assigns.

12.       This First Amended Note may not be changed or terminated orally, but
only by an agreement in writing and signed by both the Borrower and the Lender.
All of the rights, privileges, and obligations hereunder shall inure to the
benefit of Lender’s successors, and assigns and shall bind Borrower’s permitted
successors and assigns.

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13.       TO INDUCE LENDER TO ACCEPT THIS FIRST AMENDED NOTE, BORROWER
IRREVOCABLY AGREES THAT, SUBJECT TO LENDER’S SOLE AND ABSOLUTE ELECTION, ALL
ACTIONS OR PROCEEDINGS IN ANY WAY ARISING OUT OF OR RELATED TO THIS FIRST
AMENDED NOTE WILL BE LITIGATED IN COURTS HAVING SITUS IN CHICAGO, ILLINOIS.
BORROWER HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF ANY COURT LOCATED
WITHIN CHICAGO, ILLINOIS, WAIVES PERSONAL SERVICE OF PROCESS UPON BORROWER, AND
AGREES THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY REGISTERED MAIL DIRECTED
TO BORROWER AT THE ADDRESS STATED IN THE DEED OF TRUST AND SERVICE SO MADE WILL
BE DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT.

14.       The parties hereto intend and believe that each provision of this
First Amended Note comports with all applicable law. However, if any provision
in this First Amended Note is found by a court of law to be in violation of any
applicable law, and if such court should declare such provision of this First
Amended Note to be unlawful, void or unenforceable as written, then it is the
intent of all parties hereto that such provision shall be given full force and
effect to the fullest possible extent that it is legal, valid and enforceable,
that the remainder of this First Amended Note shall be construed as if such
unlawful, void or unenforceable provision were not contained herein, and that
the rights, obligations and interests of Borrower and Lender under the remainder
of this First Amended Note shall continue in full force and effect.

15.       Borrower hereby waives and renounces for itself, its legal
representatives, and its successors and assigns, all rights to the benefits of
any appraisement, exemption and homestead now provided or that may hereafter be
provided by the Constitution and laws of the United States of America and of any
state thereof to and in all its property, real and personal, against the
enforcement and collection of the obligations evidenced by this First Amended
Note.

16.       Borrower hereby transfers, conveys and assigns to Lender a sufficient
amount of such homestead or exemption as may be set apart in bankruptcy, to pay
this First Amended Note in full, with all costs of collection, and does hereby
direct any trustee in bankruptcy having possession of such homestead or
exemption to deliver to Lender a sufficient amount of property or money set
apart as exempt to pay the Indebtedness evidenced hereby, or any renewal
thereof, and does hereby appoint Lender the attorney-in-fact for Borrower to
claim any and all such homestead or exemptions allowed by law.

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17.       AFTER CONSULTING WITH COUNSEL AND CAREFUL CONSIDERATION, BORROWER AND
LENDER (BY ITS ACCEPTANCE HEREOF) KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY
WAIVE THE RIGHT EITHER OF THEM MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY
LITIGATION ARISING OUT OF THIS FIRST AMENDED NOTE OR ANY OTHER INSTRUMENT OR
AGREEMENT BY WHICH THIS FIRST AMENDED NOTE IS, OR MAY HEREAFTER BE, SECURED, OR
OUT OF ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (ORAL OR WRITTEN),
OR ACTIONS OF BORROWER OR LENDER. THIS WAIVER IS A MATERIAL INDUCEMENT TO
LENDER'S ACCEPTANCE OF THIS FIRST AMENDED NOTE.

18.       Lender may at any time assign its rights in this First Amended Note
and the Loan Documents, or any part thereof and transfer its rights in any or
all of the Collateral, and Lender thereafter shall be relieved from all
liability with respect to such Collateral. In addition, Lender may at any time
sell one or more participations in the First Amended Note. Lender may at any
time pledge or assign a security interest in all or any portion of its rights
under this First Amended Note to secure obligations of Lender, including any
pledge or assignment to secure obligations to a Federal Reserve Bank; provided
that no such pledge or assignment of a security interest shall release Lender
from any of its obligations hereunder or substitute any such pledgee or assignee
for Lender as a party hereto. Except as otherwise permitted in the Loan
Documents, Borrower may not assign its interest in this First Amended Note, or
any other agreement with Lender or any portion thereof, either voluntarily or by
operation of law, without the prior written consent of Lender.

19.       The Loan is a business loan which comes within the purview of Section
205/4, paragraph (1)(c) of Chapter 815 of the Illinois Compiled Statutes, as
amended. Borrower agrees that the Loan evidenced by this First Amended Note is
an exempted transaction under the Truth In Lending Act, 15 U.S.C., §1601, et
seq.

20.       Lender hereby notifies Borrower that pursuant to the requirements of
the USA Patriot Act (Title III of Pub. L. 107-56, signed into law October 26,
2001) (the “Act”), and Lender’s policies and practices, Lender is required to
obtain, verify and record certain information and documentation that identifies
Borrower, which information includes the name and address of Borrower and such
other information that will allow Lender to identify Borrower in accordance with
the Act. In addition, Borrower shall (a) ensure that no person who owns a
controlling interest in or otherwise controls Borrower or any subsidiary of
Borrower is or shall be listed on the Specially Designated Nationals and Blocked
Person List or other similar lists maintained by the Office of Foreign Assets
Control (“OFAC”), the Department of the Treasury or included in any Executive
Orders, (b) not use or permit the use of the proceeds of the Loan to violate any
of the foreign asset control regulations of OFAC or any enabling statute or
Executive Order relating thereto, and (c) comply, and cause any of its
subsidiaries to comply, with all applicable Bank Secrecy Act (“BSA”) laws and
regulations, as amended.

[Remainder of page intentionally blank; signatures follow]

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IN WITNESS WHEREOF, Borrower has caused this First Amended and Restated Secured
Promissory Note to be duly executed and delivered to Lender as of the date first
set forth above.

  IRESI Frederick Market Square, L.L.C.,
a Delaware limited liability company           By:

Inland Residential Operating Partnership,

L.P., a Delaware limited partnership,

its sole member

            By:

Inland Residential Properties Trust,

Inc., a Maryland corporation,

its general partner

            By: /s/ David Z. Lichterman     Name: David Z. Lichterman     Its:

Vice President, Treasurer and

Chief Accounting Officer

 

 

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SCHEDULE I

A.       DEED OF TRUST:

Purchase Money Deed of Trust, Security Agreement, Assignment of Leases and Rents
and Fixture Filing dated as of September 30, 2015 executed by Borrower to and
for the benefit of Bank and recorded with the Frederick County, Maryland
Recorder’s Office on October 6, 2015 in Book 10795, Page 0060, encumbering
certain real estate located at 300 Cormorant Place, Frederick, Maryland.

 

B.ASSIGNMENTS OF LEASES AND RENTS:

Assignment of Leases and Rents dated as of September 30, 2015, executed by
Borrower to Lender and recorded with the Frederick County, Maryland Recorder’s
Office on October 6, 2015 in Book 10795, Page 0094, encumbering certain real
estate located at 300 Cormorant Place, Frederick, Maryland.

 

C.       SECURITY AGREEMENT:

 

Security Agreement dated as of September 30, 2015, executed by Borrower.

 

D.       GUARANTY:

 

Guaranty executed by INLAND RESIDENTIAL PROPERTIES TRUST, INC., a Maryland
corporation.