Exhibit 10.119

 

November 3, 2003

 

 

Pleasant Lake Apts. Limited Partnership
c/o Ramat Securities
23811 Chagrin Boulevard, #200
Beachwood, Ohio 44122

 

Re:                              Purchase Agreement dated as of September 29, 2003 (the “Purchase Agreement”) by and between Horizon Group Properties, L.P., a Delaware limited partnership (“Horizon Group”), and Pleasant Lake Apts. Limited Partnership (“Pleasant Lake”)

 

Gentlemen:

 

This letter will confirm our understanding regarding certain issues in connection with the Purchase Agreement. Pursuant to Section 1(g) of the Purchase Agreement Horizon Group and Pleasant Lake acknowledged and agreed that Horizon Group is currently engaged in a restructuring of debt (the “Restructuring”) at Gretna, Sealy, Traverse City Outlet Centers, LLC, a Delaware limited liability company (“Gretna”).  In connection with the Restructuring, Horizon Group and Pleasant Lake hereby agree that the transaction in which Pleasant Lake will purchase from Horizon Group a total of forty-nine percent (49%) of the membership interests in Gretna (the “Gretna Transaction”) shall be completed prior to the closing on the remaining 49% Membership Interests as contemplated in the Purchase Agreement.

 

The Gretna Transaction shall be structured as follows:

 

(i) On November 3, 2003, Pleasant Lake shall pay One Million Nine Hundred and Sixty Thousand Dollars ($1,960,000) to Horizon Group for the 49% Membership Interest in Gretna.  Horizon Group shall deliver to Pleasant Lake an Assignment of Membership Interest evidencing the 49% Membership Interest in Gretna.

 

(ii) On November 3, 2003, Pleasant Lake shall lend Two Million Forty Thousand Dollars ($2,040,000) to Horizon Group pursuant to a promissory note (the “Note”).  The unpaid principal balance on the Note shall accrue interest at an annual rate equal to eight percent (8%). The Note shall mature on August  3, 2004. The Note shall be guaranteed by Horizon Group Properties, Inc., the general partner of Horizon Group.

 

(iii) Upon the completion of the Restructuring, which is anticipated to occur on or about November 5, 2003,  Pleasant Lake also shall acquire a forty-nine percent (49%) limited partnership interest in each of Sealy Outlet Center, L.L.C., a Texas limited liability company (“Sealy”) and Traverse City Outlet Center, L.L.C., a Delaware limited liability company (“Traverse City”). Sealy and Traverse City are currently wholly-owned by Gretna.  Horizon Group and/or Gretna shall deliver

 

1

 

to Pleasant Lake Assignments of Membership Interests, evidencing the forty-nine percent (49%) limited partnerships in each of Sealy and Traverse City.

 

(iv) Horizon Group and Pleasant Lake acknowledge and agree that Horizon Group may bid up to $1,600,000 in order to acquire the current note on Sealy.  In the event Horizon Group pays up to $1,600,000 to acquire the note, each partner agrees to contribute its pro rata share of any amount required to satisfy such bid.  In the event the acquisition of the note on Sealy is not to the lender’s satisfaction and Horizon Group does not acquire the current note, Horizon Group shall distribute all excess funds to the partners on a pro rata basis.

 

(v)All closing deliveries with respect to Gretna required under the Purchase Agreement will be delivered by Horizon Group to Pleasant Lake in connection with the closing of the Gretna Transaction.

 

(vi) Horizon Group and Pleasant Lake acknowledge and agree that on October 31, 2003 Horizon Group paid $84,000 to obtain its lender’s consent to terminate the Liz Claiborne lease at Sealy.  Horizon Group agrees to contribute the $1,956,000 (that is the $2,040,000 Note less $84,000) and the $1,960,000 into Gretna as a further capital contribution to maintain its fifty-one percent (51%) interest.

 

This letter agreement shall (a) be binding upon and inure to the benefit of Horizon Group and Pleasant Lake and their respective successors and assigns, (b) may be executed in one or more counterparts and each executed copy shall constitute an original, and (c) shall be governed by and construed in accordance with the laws of the State of Delaware.

 

If this letter correctly sets forth your understanding with respect to the foregoing, please indicate your acceptance by signing and dating this letter below.

 

	Horizon Group Properties, L.P., A Delaware limited partnership, By: Horizon Group Properties, Inc.,       Its General Partner
	By:
	Name:
	Its:
	Pleasant Lake Apts. Limited Partnership, an Ohio limited partnership, By:  Pleasant Lake Apt. Corp. Its General Partner
	By:
	Name:
	Its:

 

2

EXHIBIT 10.120

 

PROMISSORY NOTE

 

 

		Chicago, Illinois
$2,040,000.00		November 3, 2003

 

THIS PROMISSORY NOTE (this “Note”) is made as of the 3rd day of November, 2003, by HORIZON GROUP PROPERTIES, L.P., a Delaware limited partnership (“Borrower”), to the order of PLEASANT LAKE APTS. LIMITED PARTNERSHIP, an Ohio limited partnership (“Lender”).

 

DEFINITIONS

 

Borrower agrees that, for the purposes of this Note, the following terms shall have the following respective meanings ascribed thereto.

 

1.1                                “Dollars” shall mean dollars in lawful currency of The United States of America.

 

1.2                                “Default Rate” shall mean two percent (2%) per annum in excess of the Interest Rate but not in excess of the maximum interest rate permitted by law.

 

1.3                                “Interest Rate” shall mean eight percent (8%).

 

1.4                                “Loan” shall mean the loan made by the Lender to Borrower in the Original Principal Amount.

 

1.5                                “Maturity Date” shall mean August 3, 2004, or such earlier date the entire Outstanding Principal Balance and accrued and unpaid interest thereon, and any other sums which are due and payable pursuant to the terms and provisions of this Note are due and payable by reason of the acceleration of the maturity of this Note.

 

1.6                                “Original Principal Amount” shall mean TWO MILLION FORTY THOUSAND DOLLARS ($2,040,000.00).

 

1.7                                “Outstanding Principal Balance” shall mean the aggregate of all sums advanced by Lender to or for the benefit of Borrower hereunder and not repaid.

 

II
PAYMENT OF INTEREST AND PRINCIPAL

 

For Value Received, Borrower hereby promises to pay to the order of Lender the principal amount of Two Million Forty Thousand Dollars ($2,040,000.00), together with interest as provided herein below as follows:

 

1

 

2.1                                Payment of Interest and Principal .  The Outstanding Principal Balance evidenced by this Note shall accrue interest at the rate (“Interest Rate”) of eight percent (8%) per annum, based on a year of 365 days.

 

2.2                                Prepayment Privileges .  This Note may be prepaid in whole or in part at any time and from time to time during the term hereof upon at least fifteen (15) days’ prior written notice to Lender. All partial prepayments shall be applied in inverse order of maturity and shall not extend or reduce the next installment due hereunder.

 

2.3                                Default Interest .  Subsequent to an Event of Default until cured, interest shall accrue on the Outstanding Principal Balance at the Default Rate.

 

2.4                                Principal and Interest at Maturity .  The entire Outstanding Principal Balance and accrued and unpaid interest thereon, and any and all other sums which are due and payable pursuant to the terms and provisions of the Note shall be due and payable on the Maturity Date.

 

2.5                                Place of Payment .  Payments and prepayments to be made under this Note are to be made at such place as the legal holder of this Note may from time to time in writing appoint, and, in the absence of such appointment, then at the following address:

 

Pleasant Lake Apts. Limited Partnership
c/o Ramat Securities
23811 Chagrin Boulevard, #200
Beachwood, Ohio  44122

 

III
DEFAULTS AND REMEDIES

 

3.1                                Occurrence of Default; Acceleration of Maturity Date .  The failure by Borrower to make payment of principal or interest as same becomes due and payable or payment of any other amount due to Lender under this Note, within ten (10) days after written notice from Lender, shall constitute an event of default under this Note (an “Event of Default”).  Upon the occurrence of an Event of Default and at any time thereafter, at the election of the holder or holders hereof and without additional notice to Borrower, the principal sum remaining unpaid hereon, together with accrued interest thereon, shall become at once due and payable at the place of payment as aforesaid, and Lender may proceed to exercise any rights and remedies available to Lender against Borrower or with respect to this Note which Lender may have at law, in equity or otherwise.

 

3.2                                Nature of Remedies .  The remedies of Lender as provided herein shall be cumulative and concurrent, and may be pursued singularly, successively or together, at the sole discretion of Lender, and may be exercised as often as occasion therefor shall arise.  Failure of Lender, for any period of time or on more than one occasion, to exercise its option to accelerate the Maturity Date of this Note shall not constitute a waiver of the right to exercise the same at any time thereafter or in the event of any subsequent Event of Default.  No act of omission or commission of Lender, including specifically any failure to exercise any right, remedy or recourse, shall be deemed to be a waiver or release of the same; any such waiver or release is to be effected only through a written document executed by Lender and then only to the extent specifically recited therein.  A waiver or release in connection with any one event shall not be construed as a waiver or release of any

 

2

 

subsequent event or as a bar to any subsequent exercise of Lender’s rights or remedies hereunder.  Notice of the exercise of any right or remedy granted to Lender by this Note is not required to be given.

 

IV
OTHER GENERAL AGREEMENTS

 

4.1                                Notices .  Any notice which any party hereto may desire or may be required to give to any other party’ hereto shall be in writing, and shall be deemed given (i) if and when personally delivered, (ii) upon receipt if sent by a nationally recognized overnight courier addressed to a party at its address set forth below, or (iii) on the second (2nd) business day after being deposited in United States registered or certified mail, postage prepaid, addressed to a party at its address set forth below, or at such other place as such party may have designated to all other parties by notice in writing in accordance herewith:

 

(a)	If to Borrower:
C/o Horizon Group Properties, Inc.
77 West Wacker Drive, Suite 4200
Chicago, IL 60601
Attention:		Gary Skoien
Phone:		(312) 917-4227
Facsimile:		(312) 917-0911
	With a copy to:
	David A. Grossberg, Esq.
	Schiff Hardin & Waite
	6600 Sears Tower
	Chicago, IL  60606
	Phone:			(312) 258-5764
	Facsimile:			(312) 258-5700
(b)	If to Lender:
PLEASANT LAKE APTS. LIMITED PARTNERSHIP
c/o Ramat Securities
23811 Chagrin Boulevard, #200
Beachwood, Ohio  44122
Attention:			Howard Amster
Phone:			(216) 595-1047
Facsimile:			(216) 595-0989
	With a copy to:
	Jennifer Lawry Adams, Esq.
	Ulmer & Berne LLP
	1300 East Ninth Street, Suite 900

 

3

 

	Cleveland, Ohio  44114
	Phone:	(216) 902-8935
	Facsimile:	(216) 621-7488

 

4.2                                Governing Law .  Borrower agrees that this instrument and the rights and obligations of the parties hereunder shall be governed by the laws of the State of Ohio, without reference to the conflict of law principles of such state.

 

4.3                                Interpretation .  The headings of sections and paragraphs in this Note are for convenience only and shall not be construed in any way to limit or define the content, scope or intent of the provisions hereof.  As used in this Note, the singular shall include the plural, and masculine, feminine and neuter pronouns shall be fully interchangeable, where the context so requires.  The parties hereto intend and believe that each provision in this Note comports with all applicable law.  However, if any provision in this 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 Note to be unlawful, void or unenforceable as written, then it is the intent of all parties to the fullest possible extent that it is legal valid and enforceable, that the remainder of this Note shall be construed as if such unlawful, void or unenforceable provision were not contained therein, and that the rights, obligations and interests of Borrower and the holder hereof under the remainder of this Note shall continue in full force and effect.  Time is of the essence of this Note.

 

4.4                                Successors, Holders and Assigns .  Upon any endorsement, assignment or other transfer of this Note by Lender or by operation of law, the term “Lender,” as used herein, shall mean such endorsee, assignee or other transferee or successor to Lender then becoming the holder of this Note.  This Note shall inure to the benefit of Lender and its successors and assigns and shall be binding upon the undersigned and its successors and assigns.  The term “Borrower”, as used herein, shall include its successors and assigns.

 

4.5                                Guarantee .  This Note is guaranteed by Horizon Group Properties, Inc., the general partner of Borrower.

 

IN WITNESS WHEREOF, Borrower has, through its duly authorized officers, executed and delivered this Note as of the day and year first above written.

 

	BORROWER:
	HORIZON GROUP PROPERTIES, L.P. , a Delaware limited partnership
	By:
	Name:
	Title:

 

4

Exhibit 10.121

 

GUARANTY OF PAYMENT

 

THIS GUARANTY OF PAYMENT (this “Guaranty”) is dated as of November 3, 2003 and given by HORIZON GROUP PROPERTIES, INC. , a Maryland corporation (the “Guarantor”), to and for the benefit of PLEASANT LAKE APTS. LIMITED PARTNERSHIP (“Lender”).

 

R E C I T A L S:

 

A.                                    Pursuant to the terms and conditions of a certain Promissory Note, dated of even date herewith, between HORIZON GROUP PROPERTIES, L.P. , a Delaware limited partnership (“Borrower”) and Lender (as amended, modified, replaced or restated from time to time, the “Note”), Lender has agreed to make a Loan (as defined below) to Borrower.

 

B.                                      The loan to be made pursuant to the Note will consist of a term loan of Two Million Forty Thousand Dollars ($2,040,000) (the “Loan”).

 

C.                                      As a condition precedent to Lender’s extension of the Loan to Borrower and in consideration therefor, Lender has required, among other things, the execution and delivery of: (i) this Guaranty by Guarantor and (ii) that certain Promissory Note, dated of even date herewith, from Borrower to Lender in the original principal amount of Two Million Forty Thousand Dollars ($2,040,000) (as amended, modified, replaced or restated from time to time, the “Note”).

 

D.                                     Guarantor:  (i) is the general partner of Borrower and has a financial interest in Borrower, (ii) understands that Lender will not make the Loan to Borrower unless Guarantor executes and delivers this Guaranty to Lender, and (iii) has agreed to execute and deliver this Guaranty to Lender.

 

All terms not otherwise defined herein shall have the meaning set forth in the Note.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, Guarantor hereby agrees as follows:

 

1.                                       Guaranty of Payment .  Guarantor hereby unconditionally and irrevocably guaranties to Lender, the punctual payment and performance when due, whether at stated maturity or by acceleration or otherwise, of the indebtedness and other obligations of Borrower to Lender evidenced by the Note and any other amounts that may become owing by Borrower under the Note (such indebtedness, obligations and other amounts are hereinafter referred to as “Payment Obligations”).  This Guaranty is a present and continuing guaranty of payment and not of collectibility, and Lender shall not be required to prosecute collection, enforcement or other remedies against Borrower or any other guarantor of the Payment Obligations, or to enforce or resort to any collateral for the repayment of the Payment Obligations or other rights or remedies pertaining thereto, before calling on Guarantor for payment. If for any reason Borrower shall fail or be unable to pay, punctually and fully, any of the Payment Obligations, Guarantor shall pay such obligations to Lender in full immediately upon Lender’s written demand.  One or more successive actions may be brought against Guarantor, as often as Lender deems advisable, until all of the Payment Obligations are paid and performed in full.  The Payment Obligations, the Construction Obligations (defined below) together with all other payment

 

1

 

and performance obligations of Guarantor hereunder are referred to herein as “Borrower’s Obligations”.

 

2.                                       Performance Guaranty .  Upon the occurrence of an Event of Default under the Note which continues beyond any applicable grace or cure period, Guarantor agrees, on not more than ten (10) days written demand by Lender (a “Demand Notice”) to either cure or cause Borrower to cure the Event of Default.

 

3.                                       Representations and Warranties .  The following shall constitute representations and warranties of Guarantor and Guarantor hereby acknowledges that Lender intends to make the Loan in reliance thereon:

 

(a)                                   Guarantor is duly organized, validly existing and in good standing under the laws of the State of Maryland and has the full power and authority to enter into this Guaranty and to perform all of its duties and obligations under this Guaranty.  This Guaranty, when executed, will be a valid and legally binding obligation of Guarantor enforceable against Guarantor in accordance with its terms in all material respects.

 

(b)                                  To the best of Guarantor’s knowledge, neither the execution and delivery of this Guaranty nor compliance with the terms and provisions hereof will violate any applicable law, rule, regulation, judgment, decree or order, or will conflict with or result in any breach of any of the terms, covenants, conditions or provisions of any indenture, mortgage, deed of trust, instrument, document, agreement or contract of any kind that creates, represents, evidences or provides for any lien, charge or encumbrance upon any of the property or assets of Guarantor, or any other indenture, mortgage, deed of trust, instrument, document, agreement or contract of any kind to which Guarantor is a party or to which Guarantor or the property of Guarantor may be subject.

 

(c)                                   There is not any litigation, arbitration, governmental or administrative proceedings, actions, examinations, claims or demands pending, or to Guarantor’s knowledge, threatened that could adversely affect performance by Guarantor of his, her or its obligations under this Guaranty.

 

(d)                                  Neither this Guaranty nor any statement or certification as to facts previously furnished or required herein to be furnished to Lender by Guarantor, contains any material inaccuracy or untruth in any representation, covenant or warranty or omits to state a fact material to this Guaranty.

 

4.                                       Continuing Guaranty .  Guarantor agrees that performance of Borrower’s Obligations by Guarantor shall be a primary obligation, shall not be subject to any counterclaim, set-off, abatement, deferment or defense based upon any claim that Guarantor may have against Lender, Borrower, any other guarantor of Borrower’s Obligations or any other person or entity, and shall remain in full force and effect without regard to, and shall not be released, discharged or affected in any way by, any circumstance or condition (whether or not Guarantor shall have any knowledge thereof), including without limitation:

 

(a)                                   any lack of validity or enforceability of the Note, unless such lack of validity or enforceability arises from Lender’s willful misconduct;

 

2

 

(b)                                  any termination, amendment, modification or other change in any of the Note, including, without limitation, any modification of the interest rate(s) described therein;

 

(c)                                   any furnishing, exchange, substitution or release of any collateral securing repayment of the Loan, or any failure to perfect any lien in such collateral;

 

(d)                                  any failure, omission or delay on the part of Borrower, Guarantor, any other guarantor of Borrower’s Obligations or Lender to conform or comply with any term of the Note or any failure of Lender to give notice of any Event of Default (as defined in the Note);

 

(e)                                   any waiver, compromise, release, settlement or extension of time of payment or performance or observance of any of the obligations or agreements contained in the Note;

 

(f)                                     any action or inaction by Lender under or in respect of the Note, any failure, lack of diligence, omission or delay on the part of Lender to perfect, enforce, assert or exercise any lien, security interest, right, power or remedy conferred on it in the Note, or any other action or inaction on the part of Lender unless the act or failure to act is found to be gross negligence or willful misconduct on the part of Lender;

 

(g)                                  any voluntary or involuntary bankruptcy, insolvency, reorganization, arrangement, readjustment, assignment for the benefit of creditors, composition, receivership, liquidation, marshalling of assets and liabilities or similar events or proceedings with respect to Borrower or any other guarantor of Borrower’s Obligations, as applicable, or any of their respective property or creditors, or any action taken by any trustee or receiver or by any court in any such proceeding;

 

(h)                                  any merger or consolidation of Borrower into or with any entity, or any sale, lease or transfer of any of the assets of Borrower, Guarantor or any other guarantor of Borrower’s Obligations to any other person or entity;

 

(i)                                      any change in the ownership of Borrower or any change in the relationship between Borrower, Guarantor or any other guarantor of Borrower’s Obligations, or any termination of any such relationship;

 

(j)                                      any release or discharge by operation of law of Borrower, Guarantor or any other guarantor of Borrower’s Obligations from any obligation or agreement contained in the Note; or

 

(k)                                   any other occurrence, circumstance, happening or event, whether similar or dissimilar to the foregoing and whether foreseen or unforeseen, which otherwise might constitute a legal or equitable defense or discharge of the liabilities of a guarantor or surety or which otherwise might limit recourse against Borrower or Guarantor to the fullest extent permitted by law.

 

5.                                       Waivers .  Guarantor expressly and unconditionally waives:  (a) notice of any of the matters referred to in Section 4 above, (b) all notices which may be required by statute, rule of law or otherwise, now or hereafter in effect, to preserve intact any rights against Guarantor, including, without limitation, any demand, presentment and protest, proof of notice of non-payment under the

 

3

 

Note and notice of any Event of Default or any failure on the part of Borrower, Guarantor or any other guarantor of Borrower’s Obligations to perform or comply with any covenant, agreement, term or condition of the Note, (c) any right to the enforcement, assertion or exercise against Borrower, Guarantor or any other guarantor of Borrower’s Obligations of any right or remedy conferred under the Note, (d) any requirement of diligence on the part of any person or entity, (e) any requirement to exhaust any remedies or to mitigate the damages resulting from any default under the Note, and (f) any notice of any sale, transfer or other disposition of any right, title or interest of Lender under the Note.

 

6.                                       Subordination .  Guarantor agrees that any and all present and future debts and obligations of Borrower to Guarantor hereby are subordinated to the claims of Lender and hereby are assigned by Guarantor to Lender as security for Borrower’s Obligations and Guarantor’s obligations under this Guaranty.

 

7.                                       Subrogation Waiver .  Until Borrower’s Obligations are paid in full and all periods under applicable bankruptcy law for the contest of any payment by Guarantor or Borrower as a preferential or fraudulent payment have expired, Guarantor knowingly, and with advice of counsel, waives, relinquishes, releases and abandons all rights and claims to indemnification, contribution, reimbursement, subrogation and payment which Guarantor may now or hereafter have by and from Borrower and the successors and assigns of Borrower, for any payments made by Guarantor to Lender, including, without limitation, any rights which might allow Borrower, Borrower’s successors, a creditor of Borrower, or a trustee in bankruptcy of Borrower to claim in bankruptcy or any other similar proceedings that any payment made by Borrower or Borrower’s successors and assigns to Lender was on behalf of or for the benefit of Guarantor and that such payment is recoverable by Borrower, a creditor or trustee in bankruptcy of Borrower as a preferential payment, fraudulent conveyance, payment of an insider or any other classification of payment which may otherwise be recoverable from Lender.

 

8.                                       Reinstatement .  The obligations of Guarantor pursuant to this Guaranty shall continue to be effective or automatically be reinstated, as the case may be, if at any time payment of any of Borrower’s Obligations or Guarantor’s obligations under this Guaranty is rescinded or otherwise must be restored or returned by Lender upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of Guarantor or Borrower or otherwise, all as though such payment had not been made.

 

9.                                       Financial Statements .  Guarantor represents and warrants to Lender that:  (a) the financial statements of Guarantor contained in the Form 10-K for the year ended December 31, 2002 are true, complete and correct in all material respects, disclose all actual and contingent liabilities, and fairly present the financial condition of Guarantor, and do not contain any untrue statement of a material fact or omit to state a fact material to the financial statements submitted or this Guaranty and (b) no material adverse change has occurred in the financial statements from the dates thereof until the date hereof.  Guarantor shall furnish to Lender such additional financial information as Lender shall reasonably request from time to time.  Notwithstanding the foregoing sentence, Guarantor agrees to furnish, without the request of Lender, no later than ninety (90) days after the end of each calendar year, Guarantor’s annual financial statements for the prior calendar year.  Such annual financial statements shall be certified by an officer of Guarantor as true, complete and correct and shall be in a form substantially similar to the form of financial statements previously submitted by Guarantor to Lender, unless otherwise approved in writing by Lender or as required under

 

4

 

generally accepted accounting principles.

 

10.                                Transfers, Sales, Etc.   Guarantor shall not sell, lease, transfer, convey or assign any of its assets without the consent of Lender, which consent shall not be unreasonably withheld or delayed, unless (a) if Guarantor is an individual, such sale, lease, transfer, conveyance or assignment is of a non-material asset of such Guarantor or (b) if Guarantor is a corporation, partnership or other entity, such sale, lease, transfer, conveyance or assignment will not have a material adverse effect on the business or financial condition of Guarantor or its ability to perform its obligations hereunder.

 

11.                                Enforcement Costs .  If: (a) this Guaranty, is placed in the hands of one or more attorneys for collection or is collected through any legal proceeding; (b) one or more attorneys is retained to represent Lender in any bankruptcy, reorganization, receivership or other proceedings affecting creditors’ rights and involving a claim under this Guaranty, or (c) one or more attorneys is retained to represent Lender in any other proceedings whatsoever in connection with this Guaranty, then Guarantor shall pay to Lender upon demand all fees, costs and expenses incurred by Lender in connection therewith, including, without limitation, reasonable attorney’s fees, court costs and filing fees (all of which are referred to herein as “Enforcement Costs”), in addition to all other amounts due hereunder.

 

12.                                Successors and Assigns; Joint and Several Liability .  This Guaranty shall inure to the benefit of Lender and its successors and assigns.  This Guaranty shall be binding on Guarantor and the heirs, legatees, successors and assigns of Guarantor.  If this Guaranty is executed by more than one person, it shall be the joint and several undertaking of each of the undersigned.  Regardless of whether this Guaranty is executed by more than one person, it is agreed that the undersigned’s liability hereunder is several and independent of any other guarantees or other obligations at any time in effect with respect to Borrower’s Obligations or any part thereof and that Guarantor’s liability hereunder may be enforced regardless of the existence, validity, enforcement or non-enforcement of any such other guarantees or other obligations.

 

13.                                No Waiver of Rights .  No delay or failure on the part of Lender to exercise any right, power or privilege under this Guaranty or the Note shall operate as a waiver thereof, and no single or partial exercise of any right, power or privilege shall preclude any other or further exercise thereof or the exercise of any other power or right, or be deemed to establish a custom or course of dealing or performance between the parties hereto.  The rights and remedies herein provided are cumulative and not exclusive of any rights or remedies provided by law.  No notice to or demand on Guarantor in any case shall entitle Guarantor to any other or further notice or demand in the same, similar or other circumstance.

 

14.                                Modification .  The terms of this Guaranty may be waived, discharged, or terminated only by an instrument in writing signed by the party against which enforcement of the change, waiver, discharge or termination is sought.  No amendment, modification, waiver or other change of any of the terms of this Guaranty shall be effective without the prior written consent of Lender.

 

15.                                Joinder .  Any action to enforce this Guaranty may be brought against Guarantor without any reimbursement or joinder of Borrower or any other guarantor of Borrower’s Obligations in such action.

 

5

 

16.                                Severability .  If any provision of this Guaranty is deemed to be invalid by reason of the operation of law, or by reason of the interpretation placed thereon by any administrative agency or any court, Guarantor and Lender shall negotiate an equitable adjustment in the provisions of the same in order to effect, to the maximum extent permitted by law, the purpose of this Guaranty and the validity and enforceability of the remaining provisions, or portions or applications thereof, shall not be affected thereby and shall remain in full force and effect.

 

17.                                Applicable Law .  This Guaranty is governed as to validity, interpretation, effect and in all other respects by laws and decisions of the State of Illinois.

 

18.                                Notice .  All notices, communications and waivers under this Guaranty shall be in writing and shall be (i) delivered in person or (ii) mailed, postage prepaid, either by registered or certified mail, return receipt requested, or (iii) by overnight express carrier, addressed in each case as follows:

 

 

To Lender:		Pleasant Lake Apts. Limited Partnership c/o Ramat Securities 23811 Chagrin Boulevard, Suite 200 Beachwood, Ohio  44122 Attention:  Howard M. Amster
with a copy to:		Ulmer & Berne LLP Penton Media Building 1300 East Ninth Street, Suite 900 Cleveland, Ohio 44114 Attention:  Jennifer Lawry Adams, Esq.
to Guarantor:		Horizon Group Properties, Inc. 77 West Wacker Drive, Suite 4200 Chicago, Illinois 60601 Attention:  Gary J. Skoien
with a copy to:		Schiff Hardin & Waite 6600 Sears Tower Chicago, Illinois 60606 Attention:  David A. Grossberg, Esq.

 

or to any other address as to any of the parties hereto, as such party shall designate in a written notice to the other party hereto.  All notices sent pursuant to the terms of this Section 15 shall be deemed received (i) if personally delivered, then on the date of delivery, (ii) if sent by overnight, express carrier, then on the next federal banking day immediately following the day sent, or (iii) if sent by registered or certified mail, then on the earlier of the third federal banking day following the day sent or when actually received.

 

19.                                CONSENT TO JURISDICTION .  TO INDUCE LENDER TO ACCEPT THIS GUARANTY, GUARANTOR IRREVOCABLY AGREES THAT, SUBJECT TO LENDER’S SOLE AND ABSOLUTE ELECTION, ALL ACTIONS OR PROCEEDINGS IN ANY WAY

 

6

 

ARISING OUT OF OR RELATED TO THIS GUARANTY WILL BE LITIGATED IN COURTS HAVING SITUS IN CHICAGO, ILLINOIS.  GUARANTOR HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF ANY COURT LOCATED WITHIN CHICAGO, ILLIONOIS, WAIVES PERSONAL SERVICE OF PROCESS AND AGREES THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY REGISTERED MAIL DIRECTED TO GUARANTOR AT THE ADDRESS STATED HEREIN AND SERVICE SO MADE WILL BE DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT.

 

20.                                WAIVER OF JURY TRIAL .  GUARANTOR AND LENDER (BY ACCEPTANCE HEREOF), HAVING BEEN REPRESENTED BY COUNSEL, EACH KNOWINGLY AND VOLUNTARILY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS GUARANTY OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH AND AGREES THAT ANY SUCH ACTION OR PROCEEDING WILL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.  GUARANTOR AGREES THAT IT WILL NOT ASSERT ANY CLAIM AGAINST LENDER ON ANY THEORY OF LIABILITY FOR SPECIAL, INDIRECT, CONSEQUENTIAL, INCIDENTAL OR PUNITIVE DAMAGES.

[SIGNATURE PAGE FOLLOWS]

 

7

 

Guarantor has executed this Guaranty as of the date first above written.

 

	HORIZON GROUP PROPERITES, INC.
	By:
		David Tinkham,
		Senior Vice President / CFO

 

 

Certification

 

 

STATE OF					)
					)  SS:
COUNTY OF					)

 

 

The undersigned, a Notary Public in and for the aforementioned State and County, affirms that, on this         day of November, 2003, David Tinkham, in his capacity as Senior Vice President / CFO of Horizon Group Properties, Inc., a Maryland corporation, appeared before me and executed this Guaranty on behalf of said corporation.

 

 

	Notary Public

 

8