Exhibit 10.425


 


PROMISSORY NOTE


 


DEFINED TERMS


 


	
  Execution
  Date: December 7, 2004

  	
  City
  and State of Signing: Oak Brook, Illinois

  
	
   

  	
   

  
	
  Loan
  Amount:

  	
  Ten Million and
  No/100 Dollars ($10,000,000.00)

  	
  Interest
  Rate:  4.3% per annum

  
	
   

  	
   

  
	
  Borrower: Inland Western Denton Crossing Limited
  Partnership, an Illinois limited partnership

  
	
   

  
	
  Borrower’s
  Address:

  	
  2901 Butterfield
  Road 

  Oak Brook, Illinois 60523

  
	
   

  
	
  Holder: METLIFE BANK, N.A.

  
	
   

  
	
  Holder’s
  Address:

  	
  c/o
  Metropolitan Life Insurance Company 

  10 Park Avenue 

  Morristown, New Jersey 07960 

  Attention: Senior Vice President 

  Real Estate Investments

   

  and:

   

  Metropolitan
  Life Insurance Company 

  Two Lincoln Centre 

  5420 LBJ Freeway, Suite 1310 

  Dallas, Texas 75240 

  Attention: Director and OIC, Real Estate Investments

  
	
   

  	
   

  
	
  Maturity
  Date: January 1,
  2010

  	
   

  	
  Advance
  Date: The date
  funds arc disbursed to Borrower.

  
	
   

  	
   

  	
   

  
	
  Monthly
  Installment:
  Monthly installments of interest only at the Interest Rate (which monthly payments
  shall each be in the amount of $35,833.33)

  	
   

  	
  Permitted
  Prepayment Period:    During the 90 day period prior to the
  Maturity Date, Borrower may prepay the Loan without a Prepayment Fee on 30
  days prior written notice. In addition, commencing on the first day of the
  full 31st month following the Advance Date, Borrower may prepay
  the Loan with a Prepayment Fee on 30 days prior written notice to Holder.

  
	
   

  
	
  Liable Parties: Inland Western Retail Real Estate, Inc. 

   

  Addresses
  of Liable Parties:
  2901 Butterfield Road, Oak Brook, Illinois 60523

  
	
   

  
	
  Late
  Charge: An
  amount equal to four cents ($.04) for each dollar that is overdue, subject,
  however, to the limitations contained in Section 7 hereof, and provided,
  however, the balloon payment at the Maturity Date shall not be subject to a
  Late Charge.

  

  Default Rate: An annual rate equal to
  the Interest Rate plus four percent (4%).

  
					



 


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Note: This Promissory Note, Other Note: Promissory Note of
even date in the amount of $25,200,000.00 executed by Borrower to the order of Metropolitan
Life Insurance Company. Deed of Trust: Deed of Trust, Security Agreement, and
Fixture Filing dated as of the Execution Date granted by Borrower to the
Trustee named in the Deed of Trust for the benefit of Metropolitan Life
insurance Company and MetLife Bank, N.A. Loan Documents: This Note, the Other
Note, the Deed of Trust and any other documents related to this Note, the Other
Note and/or the Deed of Trust and all renewals, amendments, modifications,
restatements and extensions of these documents. Guaranty: Guaranty dated as of
the Execution Date and executed by Liable Parties. Indemnity Agreement:
Unsecured Indemnity Agreement dated as of the Execution Date and executed by
Borrower in favor of Metropolitan Life Insurance Company and MetLife Bank, N.A.
The Unsecured Indemnity Agreement and Guaranty are not Loan Documents and shall
survive repayment of the Loan or other termination of the Loan Documents. Loan:
The Loan evidenced by this Note. Other Loan: The Loan evidenced by the Other
Note.


 


FOR VALUE RECEIVED, Borrower promises to pay to the
order of Holder at Holder’s Address or such other place as Holder may from time
to time designate, the Loan Amount with interest payable in the manner
described below, in money of the United States of America that at the time of
payment shall be legal tender for payment of all obligations.


 


Capitalized terms which are not defined in this Note
shall have the meanings set forth in the Deed of Trust.


 


1.                                       Payment of Principal and Interest. Principal and interest under this Note
shall be payable as follows:


 


(a)                                  Commencing on the first day of the second
calendar month following the Advance Date (assuming stub interest for the month
of closing of the Loan is paid on the Execution Date) and on the first day of
each calendar month thereafter, to and including the first day of the calendar
month immediately preceding the Maturity Date, Borrower shall pay the Monthly
Installment; and


 


(b)                                 On the Maturity Date, a final payment in
the aggregate amount of the unpaid principal sum evidenced by this Note, all
accrued and unpaid interest, and all other sums evidenced by this Note or
secured by the Deed of Trust and/or any other Loan Documents as well as any
future advances under the Deed of Trust that may be made to or on behalf of
Borrower by Holder following the Advance Date (collectively, the “Secured Indebtedness”), shall become immediately payable in
full.


 


Borrower acknowledges and agrees that a substantial
portion of the original Loan Amount may be outstanding and due on the Maturity
Date.


 


Interest shall be calculated on the basis of a thirty
(30) day month and a three hundred sixty (360) day year, except that (i) if the
Advance Date occurs on a date other than the first day of a calendar month,
interest payable for the period commencing on the Advance Date and ending on
the last day of the month in which the Advance Date occurs shall be calculated
on the basis of the actual number of days elapsed over a 365 day or 366 day
year, as applicable, and (ii) if the Maturity Date occurs on a date other than
the last day of the month, interest payable for the period commencing on the
first day of the month in which the Maturity Date occurs and ending on the
Maturity Date shall he calculated on the basis of the actual number of days
elapsed over a 365 day or 366 day year, as applicable.


 


2.                                       Application of Payments. At the election of Holder, and to the
extent permitted by law, all payments shall be applied in the order selected by
Holder to any expenses, prepayment fees, late charges, escrow deposits and
other sums due and payable under the Loan Documents, and to unpaid interest at
the Interest Rate or at the Default Rate, as applicable. The balance of any
payments shall be applied to reduce the then unpaid Loan Amount.


 


3.                                       Security. The covenants of the Deed of Trust are incorporated
by reference into this Note. This Note shall evidence, and the Deed of Trust
shall secure the Secured Indebtedness and the Secured Indebtedness (as defined
in the Other Note) under the Other Note.


 


4.                                          Late Charge. If any payment of interest, any payment
of a Monthly Installment or any payment of a required escrow deposit is not
paid within 7 days of the due date, Holder shall have the option to charge
Borrower the Late Charge. The Late Charge is for the purpose of defraying the
expenses incurred in connection with


 


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handling
and processing delinquent payments and is payable in addition to any other
remedy Holder may have. Unpaid Late Charges shall become part of the Secured Indebtedness
and shall be added to any subsequent payments due under the Loan Documents.


 


5.                                       Acceleration Upon Default. At the option of Holder, if Borrower
fails to pay any sum specified in this Note within 7 days of the due date, or
if an Event of Default occurs, the Secured Indebtedness, and all other sums
evidenced and/or secured by the Loan Documents, including without limitation
any applicable prepayment fees (collectively, the “Accelerated
Loan Amount”) shall become immediately due and payable.


 


6.                                       Interest Upon Default. The Accelerated Loan Amount shall bear
interest at the Default Rate which shall never exceed the maximum rate of
interest permitted to be contracted for under the laws of the State of Texas.
The Default Rate shall commence upon the occurrence of an Event of Default and
shall continue until all defaults are cured.


 


7.                                       Limitation on Interest.


 


(a)                                  Sayings Clause. It is expressly stipulated and agreed
to be the intent of Borrower and Holder at all times to comply strictly with
the applicable Texas law governing the maximum rate or amount of interest
payable on this Note or the Related Indebtedness (as herein defined) (or
applicable United States federal law to the extent that it permits Holder to
contract for, charge, take, reserve or receive a greater amount of interest
than under Texas law). If the applicable law is ever judicially interpreted so
as to render usurious any amount (i) contracted for, charged, taken, reserved
or received pursuant to this Note, any of the other Loan Documents or any other
communication or writing by or between Borrower and Holder related to the
transaction or transactions that are the subject matter of the Loan Documents,
(ii) contracted for, charged or received by reason of Holder’s exercise of the
option to accelerate the maturity of this Note and/or the Related Indebtedness,
or (iii) Borrower will have paid or Holder will have received by reason of any
voluntary prepayment by Borrower of this Note and/or the Related Indebtedness,
then it is Borrower’s and Holder’s express intent that all amounts charged in
excess of the Maximum Lawful Rate shall be automatically cancelled, ab
initio, and all amounts in excess of the Maximum Lawful Rate theretofore
collected by Holder shall be credited on the principal balance of this Note
and/or the Related Indebtedness without payment of the Prepayment Fee (or, if
this Note and all Related Indebtedness have been or would thereby be paid in
full, refunded to Borrower), and the provisions of this Note and the other Loan
Documents immediately be deemed reformed and the amounts thereafter collectible
hereunder and thereunder reduced, without the necessity of the execution of any
new document, so as to comply with the applicable law, but so as to permit the
recovery of the fullest amount otherwise called for hereunder and thereunder;
provided, however, if this Note has been paid in full before the end of the
stated term of this Note, then Borrower and Holder agree that Holder shall,
with reasonable promptness after Holder discovers or is advised by Borrower
that interest was received in an amount in excess of the Maximum Lawful Rate,
either refund such excess interest to Borrower and/or credit such excess
interest against this Note and/or any Related Indebtedness then owing by Borrower
to Holder without payment of the Prepayment Fee, Borrower hereby agrees that as
a condition precedent to any claim seeking usury penalties against Holder,
Borrower will provide written notice to Holder, advising Holder in reasonable
detail of the nature and amount of the violation, and Holder shall have sixty
(60) days after receipt of such notice in which to correct such usury
violation, if any, by either refunding such excess interest to Borrower or
crediting such excess interest against this Note and/or the Related
Indebtedness then owing by Borrower to Holder without payment of the Prepayment
Fee. All sums contracted for, charged or received by Holder for the use,
forbearance or detention of any debt evidenced by this Note and/or the Related
Indebtedness shall, to the extent permitted by applicable law, be amortized or
spread, using the actuarial method, throughout the stated term of this Note
and/or the Related Indebtedness (including any and all renewal and extension
periods) until payment in full so that the rate or amount of interest on
account of this Note and/or the Related Indebtedness does not exceed the
Maximum Lawful Rate from time to time in effect and applicable to this Note
and/or the Related Indebtedness for so long as debt is outstanding. In no event
shall the provisions of Chapter 346 of the Texas Finance Code (which regulates
certain revolving credit loan accounts and revolving triparty accounts) apply
to this Note and/or the Related Indebtedness. Notwithstanding anything to the
contrary contained herein or in any of the other Loan Documents, it is not the
intention of Holder to accelerate the maturity of any interest that has not
accrued at the time of such acceleration or to collect unearned interest at the
time of such acceleration.


 


(b)                                 Definitions. As used herein, the term “Maximum
Lawful Rate” shall mean the maximum lawful rate of interest which may be
contracted for, charged, taken, received or reserved by Holder in accordance
with the applicable laws of the State of Texas (or applicable United States
federal law to the extent that it permits Holder to contract for, charge, take,
receive or reserve a greater amount of interest than under Texas law), taking
into account all Charges (as herein defined) made in connection with the transaction
evidenced by this Note and the other Loan Documents. As used herein, the term “Charges”
shall mean all fees, charges and/or any other things of value, if


 


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any,
contracted for, charged, received, taken or reserved by Holder in connection
with the transactions relating to this Note and the other Loan Documents, which
are treated as interest under applicable law. As used herein, the term “Related
Indebtedness” shall mean any and all debt paid or payable by Borrower to
Holder pursuant to the Loan Documents or any other communication or writing by
or between Borrower and Holder related to the transaction or transactions that
arc the subject matter of the Loan Documents, except such debt which has been
paid or is payable by Borrower to Holder under this Note.


 


(c)                                  Ceiling Election. To the extent that Holder is relying on
Chapter ID of the Texas Credit Title to determine the Maximum Lawful Rate
payable on this Note and/or the Related Indebtedness, Holder will utilize the
weekly ceiling from time to time in effect as provided in such Chapter ID, as
amended. To the extent United States federal law permits Holder to contract
for, charge, take, receive or reserve a greater amount of interest than under
Texas law, Holder will rely on United States federal law instead of such
Chapter ID for the purpose of determining the Maximum Lawful Rate.
Additionally, to the extent permitted by applicable law now or hereafter in
effect, Holder may, at its option and from time to time, utilize any other
method of establishing the Maximum Lawful Rate under such Chapter ID or under
other applicable law by giving notice, if required, to Borrower as provided by
applicable law now or hereafter in effect.


 


8.                                       Prepayment. Borrower shall not have the right to prepay all or
any portion of the Loan Amount at any time during the term of this Note except
as expressly set forth in the Defined Terms. If Borrower provides notice of its
intention to prepay, the Accelerated Loan Amount shall become due and payable
on the date specified in the prepayment notice. In addition to the above
limitations upon prepayment, this Note may not be prepaid without the
simultaneous prepayment of the Other Note in accordance with its terms.


 


9.                                       Prepayment Fee.


 


(a)                                  Any tender of payment by Borrower or any
other person or entity of the Secured Indebtedness, other than as expressly
provided in the Loan Documents, shall constitute a prohibited prepayment. If a
prepayment of all or any part of the Secured Indebtedness is made following (i)
an Event of Default and an acceleration of the Maturity Date, or (ii) in
connection with a purchase of the Property or a repayment of the Secured
Indebtedness at any time before, during or after, a judicial or non-judicial
foreclosure or sale of the Property, then to compensate Holder for the loss of
the investment, Borrower shall pay an amount equal to the Prepayment Fee (as
hereinafter defined).


 


(b)                                 The “Prepayment Fee”
shall be the greater of (A) the Prepayment Ratio (as hereinafter defined)
multiplied by the difference between (x) and (y), where (x) is the present
value of all remaining payments of principal and interest including the
outstanding principal due on the Maturity Date, discounted at the rate which,
when compounded monthly, is equivalent to the Treasury Rate plus fifty basis
points (.5%) compounded semi-annually, and (y) is the amount of the principal
then outstanding, or (B) one percent (1%) of the amount of the principal being
prepaid.


 


(c)                                  The “Treasury Rate”
shall be the annualized yield on securities issued by the United States
Treasury having a maturity equal to the remaining stated term of this Note, as
quoted in the Federal Reserve Statistical Release [H. 15 (519)] under
the heading “U.S. Government Securities - Treasury Constant Maturities” for the
date on which prepayment is being made. If this rate is not available as of the
date of prepayment, the Treasury Rate shall be determined by interpolating
between the yield on securities of the next longer and next shorter maturity.
If the Treasury Rate is no longer published, Holder shall select a comparable
rate. Holder will, upon request, provide an estimate of the amount of the
Prepayment Fee two weeks before the date of the scheduled prepayment.


 


(d)                                 The “Prepayment Ratio”
shall be a fraction, the numerator of which shall be the amount of principal
being prepaid, and the denominator of which shall be the principal then
outstanding.


 


10.                                 Waiver of Right to Prepay Note Without
Prepayment Fee.
Borrower acknowledges that Holder has relied upon the anticipated investment
return under this Note in entering into transactions with, and in making
commitments to, third parties and that the tender of any prohibited prepayment,
shall, to the extent permitted by law, include the Prepayment Fee. Borrower
agrees that the Prepayment Fee represents the reasonable estimate of Holder and
Borrower of a fair average compensation for the loss that may be sustained by
Holder as a result of a prohibited prepayment of this Note and it shall be paid
without prejudice to the right of Holder to collect any other amounts provided
to be paid under the Loan Documents.


 


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BORROWER EXPRESSLY (A) WAIVES ANY RIGHTS IT MAY HAVE
UNDER TEXAS LAW TO PREPAY THIS NOTE, IN WHOLE OR IN PART, WITHOUT FEE OR
PENALTY, UPON ACCELERATION OF THE MATURITY DATE OF THIS NOTE, AND (B) AGREES
THAT IF, FOR ANY REASON, A PREPAYMENT OF THIS NOTE IS MADE, UPON OR FOLLOWING
ANY ACCELERATION OF THE MATURITY DATE OF THIS NOTE BY HOLDER ON ACCOUNT OF ANY
DEFAULT BY BORROWER UNDER ANY LOAN DOCUMENT, INCLUDING BUT NOT LIMITED TO ANY
TRANSFER, FURTHER ENCUMBRANCE OR DISPOSITION WHICH IS PROHIBITED OR RESTRICTED
BY THE DEED OF TRUST, THEN BORROWER SHALL BE OBLIGATED TO PAY CONCURRENTLY THE PREPAYMENT
FEE SPECIFIED IN SECTION 9. BY EXECUTING THIS NOTE, BORROWER AGREES THAT
HOLDER’S AGREEMENT TO MAKE THE LOAN AT THE INTEREST RATE AND FOR THE TERM SET
FORTH IN THIS NOTE CONSTITUTES ADEQUATE CONSIDERATION FOR THIS WAIVER AND
AGREEMENT.


 


11.                                Liability of Borrower. Upon the occurrence of an Event of
Default, except as provided in this Section 11, Holder will look solely to
the Property and the security under the Loan Documents for the repayment of the
Loan and will not enforce a deficiency judgment against Borrower. However,
nothing contained in this section shall limit the rights of Holder to
proceed against Borrower and the general partners of Borrower and/or the Liable
Parties, if any, (i) to enforce any Leases entered into by Borrower or its
affiliates as tenant, guarantees, or other agreements entered into by Borrower
in a capacity other than as borrower or any policies of insurance; (ii) to
recover damages for fraud, material misrepresentation, material breach of
warranty or waste; (iii) to recover any Condemnation Proceeds or Insurance
Proceeds or other similar funds which have been misapplied by Borrower or
which, under the terms of the Loan Documents, should have been paid to Holder;
(iv) to recover any tenant security deposits, tenant letter of credit or other
deposits or fees paid to Borrower that are part of the collateral for the Loan
or prepaid rents for a period of more than 30 days which have not been
delivered to Holder; (v) to recover Rents and Profits received by Borrower
after the first day of the month in which an Event of Default occurs and prior
to the date Holder acquires title to the Property which have not been applied
to the Loan or in accordance with the Loan Documents to operating and
maintenance expenses of the Property; (vi) to recover damages, costs and
expenses arising from, or in connection with Article VI of the Deed of
Trust pertaining to hazardous materials or the Indemnity Agreement; (vii) to
recover all amounts due and payable pursuant to Sections 11.06 and 11.07 of the
Deed of Trust and any amount expended by Holder in connection with the
foreclosure of the Deed of Trust; (viii) to recover damages arising from
Borrower’s failure to comply with Section 8.01 of the Deed of Trust
pertaining to ERlSA; and/or (ix) to recover any damages for Borrower’s failure
to comply with Section 2.05 of the Deed of Trust pertaining to Premiums
and Impositions; and/or (x) to recover all amounts due and payable, or to
recover any damages for Borrower’s failure to comply with, the provisions of Article XV
of the Deed of Trust.


 


The limitation of liability set forth in this Section 11
shall not apply and the Loan shall be fully recourse to Borrower and Liable
Parties (i) in the event that prior to the repayment of the Secured
Indebtedness, Borrower commences a voluntary bankruptcy or insolvency
proceeding or an involuntary bankruptcy or insolvency proceeding is commenced
against Borrower and is not dismissed within 90 days of filing or (ii) to
recover damages arising from Borrower’s failure to comply with Sections 10.02
and ll.0l(g) of the Deed of Trust pertaining to subordinate financing and
Transfers, respectively. In addition, this agreement shall not waive any rights
which Holder would have under any provisions of the U.S. Bankruptcy Code to
file a claim for the full amount of the Secured Indebtedness or to require that
the Property shall continue to secure all of the Secured Indebtedness.


 


12.                                Waiver by Borrower. Borrower and others who may become
liable for the payment of all or any part of this Note, and each of them, waive
diligence, demand, presentment for payment, notice of nonpayment, protest,
notice of dishonor and notice of protest, notice of intent to accelerate and
notice of acceleration and specifically consent to and waive notice of any
amendments, modifications, renewals or extensions of this Note, including the
granting of extension of time for payment, whether made to or in favor of
Borrower or any other person or persons.


 


13.                                Exercise of Rights. No single or partial exercise by
Holder, or delay or omission in the exercise by Holder, of any right or remedy
under the Loan Documents shall waive or limit the exercise of any such right or
remedy. Holder shall at all times have the right to proceed against any portion
of or interest in the Property in the manner that Holder may deem appropriate,
without waiving any other rights or remedies. The release of any party under
this Note shall not operate to release any other party which is liable under
this Note and/or under the other Loan Documents or under the Indemnity
Agreement.


 


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14.                                Fees and Expenses. If Borrower defaults under this Note,
Borrower shall be personally liable for and shall pay to Holder, in addition to
the sums stated above, the costs and expenses of enforcement and collection,
including a reasonable sum as an attorney’s fee. This obligation is not limited
by Section 11.


 


15.                                No Amendments. This Note may not be modified or
amended except in a writing executed by Borrower and Holder. No waivers shall
be effective unless they are set forth in a writing signed by the party which
is waiving a right. This Note and the other Loan Documents are the final
expression of the lending relationship between Borrower.


 


16.                                Governing Law. This Note is to be construed and
enforced in accordance with the laws of the State of Texas.


 


17.                                Construction. The words “Borrower” and “Holder” shall
be deemed to include their respective heirs, representatives, successors and
assigns, and shall denote the singular and/or plural, and the masculine and/or
feminine, and natural and/or artificial persons, as appropriate. The provisions
of this Note shall remain in full force and effect notwithstanding any changes
in the shareholders, partners or members of Borrower. If more than one party is
Borrower, the obligations of each party shall be joint and several. The
captions in this Note are inserted only for convenience of reference and do not
expand, limit or define the scope or intent of any section of this Note.


 


18.                                Notices. All notices, demands, requests and consents
permitted or required under this Note shall be given in the manner prescribed
in the Deed of Trust.


 


19.                                Time of the Essence. Time shall be of the essence with
respect to all of Borrower’s obligations under this Note.


 


20.                                Severability. If any provision of this Note should be
held unenforceable or void, then that provision shall be deemed separable from
the remaining provisions and shall not affect the validity of this Note, except
that if that provision relates to the payment of any monetary sum, then Holder
may, at its option, declare the Secured Indebtedness (together with the
Prepayment Fee) immediately due and payable.


 


 


IN WITNESS WHEREOF, Borrower has executed this Note as
of the Execution Date.


 


	
   

  	
   

  	
  INLAND WESTERN
  DENTON CROSSING LIMITED

  
	
   

  	
   

  	
  PARTNERSHIP,

  
	
   

  	
   

  	
  an Illinois
  limited partnership

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Inland Western
  Denton Crossing GP, L.L.C., 

  a Delaware limited liability company,

  its sole general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Inland Western
  Retail Real Estate Trust, Inc., 

  a Maryland corporation,

  its sole member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   /s/ VALERIE MEDINA

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  VALERIE MEDINA

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Assistant Secretary

  	
   

  
										



 


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