MORTGAGE AND SECURITY AGREEMENT
THIS SECURITY INSTRUMENT AND SECURITY AGREEMENT (this "Security
Instrument") is made as of this P. day of December, 2005, by RD ELMWOOD
ASSOCIATES, L.P., a Delaware limited partnership, having its principal place of
business at c/o Acadia Realty Trust, 0000 Xxxxxxxxxx Xxxxxx - Xxxxx 000, Xxxxx
Xxxxxx, Xxx Xxxx 00000, as mortgagor ("Borrower") for the benefit of MORTGAGE
ELECTRONIC REGISTRATION SYSTEMS, INC., A DELAWARE CORPORATION, HAVING AN ADDRESS
AT 0000 XXXXXX XXXX XXXX, XXXXX 000 XXXXXX, XXXXXXXX 00000 ("MERS"), AS NOMINEE
OF BEAR XXXXXXX COMMERCIAL MORTGAGE, INC., a New York corporation, having an
address at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, as mortgagee
("Lender").
WITNESSETH:
WHEREAS, this Security Instrument is given to secure a loan
(the "Loan") in the principal sum of Thirty-Four Million Six Hundred Thousand
and No/100 Dollars ($34,600,000.00) advanced pursuant to that certain Loan
Agreement, dated as of the date hereof, between Borrower and Lender (as the same
may hereafter be amended, restated, replaced, supplemented, renewed, extended or
otherwise modified from time to time, the "Loan Agreement") and evidenced by
that certain Promissory Note, dated the date hereof, made by Borrower in favor
of Lender (as the same may hereafter be amended, restated, replaced,
supplemented, renewed, extended or otherwise modified from time to time, the
"Note");
WHEREAS, Borrower desires to secure the payment of the Debt
(as defined in the Loan Agreement) and the performance of all of its obligations
under the Note, the Loan Agreement and the other Loan Documents (as herein
defined); and
WHEREAS, this Security Instrument is given pursuant to the
Loan Agreement, and payment, fulfillment, and performance by Borrower of its
obligations thereunder and under the other Loan Documents are secured hereby,
and each and every term and provision of the Loan Agreement, the Note, and that
certain Assignment of Leases and Rents of even date herewith made by Borrower in
favor of MFRS, as nominee of Lender delivered in connection with this Security
Agreement (as the same may be amended, restated, replaced, supplemented,
renewed, extended or otherwise modified from time to time, the "Assignment of
Leases"), including the rights, remedies, obligations, covenants, conditions,
agreements, indemnities, representations and warranties of the parties therein,
are hereby incorporated by reference herein as though set forth in full and
shall be considered a part of this Security Instrument (the Loan Agreement, the
Note, this Security Instrument, the Assignment of Leases and Rents and all other
documents evidencing or securing the Debt (including all additional mortgages,
deeds to secure debt and assignments of leases and rents) or executed or
delivered in connection therewith, are hereinafter referred to collectively as
the "Loan Documents").
NOW THEREFORE, in consideration of the making of the Loan by
Lender and the covenants, agreements, representations and warranties set forth
in this Security Instrument:
ARTICLE 1 - GRANTS OF SECURITY
SECTION 1.1 PROPERTY MORTGAGED. Borrower does hereby irrevocably
mortgage, grant, bargain, sell, pledge, assign, warrant, transfer and convey to
MERS, as nominee of Lender and its successors and assigns the following
property, rights, interests and estates now owned, or hereafter acquired by
Borrower (collectively, the "Property"):
(a) Land. The real property described in Exhibit A attached
hereto and made a part hereof (the "Land");
(b) Additional Land. All xxxxxxxxxx xxxxx, xxxxxxx and
development rights hereafter acquired by Borrower for use in connection with the
Land and the development of the Land and all additional lands and estates
therein which may, from time to time, by supplemental mortgage or otherwise be
expressly made subject to the lien of this Security Instrument;
(c) Improvements. The buildings, structures, fixtures,
additions, enlargements, extensions, modifications, repairs, replacements and
improvements now or hereafter erected or located on the Land (collectively, the
"Improvements");
(d) Easements. All easements, nights-of-way or use, rights,
strips and gores of land, streets, ways, alleys, passages, sewer rights, water,
water courses, water rights and powers, air rights and development rights, and
all estates, rights, titles, interests, privileges, liberties, servitudes,
tenements, hereditaments and appurtenances of any nature whatsoever, in any way
now or hereafter belonging, relating or pertaining to the Land and the
Improvements and the reversions and remainders, and all land lying in the bed of
any street, road or avenue, opened or proposed, in front of or adjoining the
Land, to the center line thereof and all the estates, rights, titles, interests,
rights of dower, rights of curtesy, property, possession, claim and demand
whatsoever, both at law and in equity, of Borrower of, in and to the Land and
the Improvements and every part and parcel thereof, with the appurtenances
thereto;
(e) Equipment. All "equipment," as such term is defined in
Article 9 of the Unifouuu Commercial Code (as hereinafter defined), now owned or
hereafter acquired by Borrower, which is used at or in connection with the
Improvements or the Land or is located thereon or therein (including, but not
limited to, all machinery, equipment, furnishings, and electronic
data-processing and other office equipment now owned or hereafter acquired by
Borrower and any and all additions, substitutions and replacements of any of the
foregoing), together with all attachments, components, parts, equipment and
accessories installed thereon or affixed thereto (collectively, the
"Equipment"). Notwithstanding the foregoing, Equipment shall not include any
property belonging to tenants under leases except to the extent that Borrower
shall have any right or interest therein;
-2-
(f) Fixtures. All Equipment now owned, or the ownership of
which is hereafter acquired, by Borrower which is so related to the Land and
Improvements founing part of the Property that it is deemed fixtures or real
property under the law of the particular state in which the Equipment is
located, including, without limitation, all building or construction materials
intended for construction, reconstruction, alteration or repair of or
installation on the Property, construction equipment, appliances, machinery,
plant equipment, fittings, apparatuses, fixtures and other items now or
hereafter attached to, installed in or used in connection with (temporarily or
permanently) any of the Improvements or the Land, including, but not limited to,
engines, devices for the operation of pumps, pipes, plumbing, call and sprinkler
systems, fire extinguishing apparatuses and equipment, heating, ventilating,
incinerating, electrical, air conditioning and air cooling equipment and
systems, gas and electric machinery, appurtenances and equipment, pollution
control equipment, security systems, disposals, dishwashers, refrigerators and
ranges, recreational equipment and facilities of all kinds, and water, gas,
electrical, storm and sanitary sewer facilities, utility lines and equipment
(whether owned individually or jointly with others, and, if owned jointly, to
the extent of Borrower's interest therein) and all other utilities whether or
not situated in easements, all water tanks, water supply, water power sites,
fuel stations, fuel tanks, fuel supply, and all other structures, together with
all accessions, appurtenances, additions, replacements, betteitnents and
substitutions for any of the foregoing and the proceeds thereof (collectively,
the "Fixtures"). Notwithstanding the foregoing, "Fixtures" shall not include any
property which tenants are entitled to remove pursuant to leases except to the
extent that Borrower shall have any right or interest therein;
(g) Personal Property. All furniture, furnishings, objects of
art, machinery, goods, tools, supplies, appliances, general intangibles,
contract rights, accounts, accounts receivable, franchises, licenses,
certificates and permits, and all other personal property of any kind or
character whatsoever as defined in and subject to the provisions of the Uniform
Commercial Code, whether tangible or intangible, other than Fixtures, which are
now or hereafter owned by Borrower and which are located within or about the
Land and the Improvements, together with all accessories, replacements and
substitutions thereto or therefor and the proceeds thereof (collectively, the
"Personal Property"), and the right, title and interest of Borrower in and to
any of the Personal Property which may be subject to any security interests, as
defined in the Uniform Commercial Code, as adopted and enacted by the state or
states where any of the Property is located (the "Uniform Commercial Code"),
superior in lien to the lien of this Security Instrument and all proceeds and
products of the above;
(h) Leases and Rents. All leases, subleases or subsubleases,
lettings, licenses, concessions or other agreements (whether written or oral)
pursuant to which any Person is granted a possessory interest in, or right to
use or occupy all or any portion of the Land and the Improvements, and every
modification, amendment or other agreement relating to such leases, subleases,
subsubleases, or other agreements entered into in connection with such leases,
subleases, subsubleases, or other agreements and every guarantee of the
performance and observance of the covenants, conditions and agreements to be
performed and observed by the other party thereto, heretofore or hereafter
entered into (collectively, the "Leases"), whether before or after the filing by
or against Borrower of any petition for relief under the Bankruptcy Code and all
right, title and interest of Borrower, its successors and assigns therein and
thereunder, including, without limitation, cash or securities deposited
thereunder to secure the performance by the lessees of their obligations
thereunder and all rents, additional rents, revenues, issues and profits
(including all oil and gas or other mineral royalties and bonuses) from the Land
and the Improvements whether paid or accruing before or after the filing by or
against Borrower of any petition for relief under the Bankruptcy Code
(collectively, the "Rents") and all proceeds from the sale or other disposition
of the Leases and the right to receive and apply the Rents to the payment of the
Debt;
-3-
(i) Condemnation Awards. All awards or payments, including
interest thereon, which may heretofore and hereafter be made with respect to the
Property, whether from the exercise of the right of eminent domain (including,
but not limited to, any transfer made in lieu of or in anticipation of the
exercise of the right), or for a change of grade, or for any other injury to or
decrease in the value of the Property;
(j) Insurance Proceeds,. All proceeds in respect of the
Property under any insurance policies covering the Property, including, without
limitation, the right to receive and apply the proceeds of any insurance,
judgments, or settlements made in lieu thereof, for damage to the Property;
(k) Tax Certiorari. All refunds, rebates or credits in
connection with reduction in real estate taxes and assessments charged against
the Property as a result of tax certiorari or any applications or proceedings
for reduction;
(1) Conversion. All proceeds of the conversion, voluntary or
involuntary, of any of the foregoing including, without limitation, proceeds of
insurance and condemnation awards, into cash or liquidation claims;
(m) Rights. The right, in the name and on behalf of Borrower,
to appear in and defend any action or proceeding brought with respect to the
Property and to commence any action or proceeding to protect the interest of
Lender in the Property;
(n) Agreements. All agreements, contracts, certificates,
instruments, franchises, permits, licenses, plans, specifications and other
documents, now or hereafter entered into, and all rights therein and thereto,
respecting or pertaining to the use, occupation, construction, management or
operation of the Land and any part thereof and any Improvements or any business
or activity conducted on the Land and any part thereof and all right, title and
interest of Borrower therein and thereunder, including, without limitation, the
right, upon the happening of any default hereunder, to receive and collect any
sums payable to Borrower thereunder;
(o) Trademarks. All tradenames, trademarks, servicemarks,
logos, copyrights, goodwill, books and records and all other general intangibles
relating to or used in connection with the operation of the Property;
(p) Accounts. All reserves, escrows and deposit accounts
maintained by Borrower with respect to the Property, including, without
limitation (i) all accounts established pursuant to the Cash Management
Agreement, including, without limitation, that and (ii) all accounts t,
including, without limitation, that certain Account Number [__________________
at-{;______ together with all deposits or wire transfers made to the Lockbox
Account or Cash Management Account and all cash, checks, drafts, certificates,
securities, investment property, financial assets, instruments and other
property held therein from time to time and all proceeds, products,
distributions or dividends or substitutions thereon and thereof; and
-4-
(q) Other Rights. Any and all other rights of Borrower in and
to the items set forth in Subsections (a) through (p) above.
AND without limiting any of the other provisions of this
Security Instrument, to the extent permitted by applicable law, Borrower
expressly grants to MERS, as nominee of Lender, as secured party, a security
interest in the portion of the Property which is or may be subject to the
provisions of the Uniform Commercial Code which are applicable to secured
transactions; it being understood and agreed that the Improvements and Fixtures
are part and parcel of the Land (the Land, the Improvements and the Fixtures
collectively referred to as the "Real Property") appropriated to the use thereof
and, whether affixed or annexed to the Real Property or not, shall for the
purposes of this Security Instrument be deemed conclusively to be real estate
and mortgaged hereby.
SECTION 1.2 ASSIGNMENT OF RENTS. Borrower hereby absolutely and
unconditionally assigns to MERS, as nominee of Lender all of Borrower's right,
title and interest in and to all current and future Leases and Rents; it being
intended by Borrower that this assignment constitutes a present, absolute
assignment and not an assignment for additional security only. Nevertheless,
subject to the terms of the Assignment of Leases, the Cash Management Agreement
and Section 7.1(h) of this Security Instrument, Lender grants to Borrower a
revocable license to collect, receive, use and enjoy the Rents and Borrower
shall hold the Rents, or a portion thereof sufficient to discharge all current
sums due on the Debt, for use in the payment of such sums.
SECTION 1.3 SECURITY AGREEMENT. This Security Instrument is both a real
property mortgage and a "security agreement" within the meaning of the Uniform
Commercial Code. The Property includes both real and personal property and all
other rights and interests, whether tangible or intangible in nature, of
Borrower in the Property. By executing and delivering this Security Instrument,
Borrower hereby grants to MERS, as nominee of Lender, as security for the
Obligations (hereinafter defined), a security interest in the Fixtures, the
Equipment and the Personal Property to the full extent that the Fixtures, the
Equipment and the Personal Property may be subject to the Uniform Commercial
Code (said portion of the Property so subject to the Uniform Commercial Code
being called the "Collateral"). If an Event of Default shall occur and be
continuing, Lender, in addition to any other rights and remedies which it may
have, shall have and may exercise immediately and without demand, any and all
rights and remedies granted to a secured party upon default under the Uniform
Commercial Code, including, without limiting the generality of the foregoing,
the right to take possession of the Collateral or any part thereof, and to take
such other measures as Lender may deem necessary for the care, protection and
preservation of the Collateral. Upon request or demand of Lender after the
occurrence and during the continuance of an Event of Default, Borrower shall, at
its expense, assemble the Collateral and make it available to Lender at a
convenient place (at the Land if tangible property) reasonably acceptable to
Lender. Borrower shall pay to Lender on demand any and all expenses, including
reasonable legal expenses and attorneys' fees, incurred or paid by Lender in
protecting its interest in the Collateral and in enforcing its rights hereunder
with respect to the Collateral after the occurrence and during the continuance
of an Event of Default. Any notice of sale, disposition or other intended action
by Lender with respect to the Collateral sent to Borrower in accordance with the
provisions hereof at least ten (10) business days prior to such action, shall,
except as otherwise provided by applicable law, constitute reasonable notice to
Borrower. The proceeds of any disposition of the Collateral, or any part
thereof, may, except as otherwise required by applicable law, be applied by
Lender to the payment of the Debt in such priority and proportions as Lender in
its discretion shall deem proper. Borrower's (debtor's) principal place of
business is as set forth on page one hereof and the address of Lender (secured
party) is as set forth on page one hereof.
-5-
SECTION 1.4 FIXTURE FILING. Certain of the Property is or will become
"fixtures" (as that term is defined in the Uniform Commercial Code) on the Land,
and this Security Instrument, upon being filed for record in the real estate
records of the city or county wherein such fixtures are situated, shall operate
also as a financing statement filed as a fixture filing in accordance with the
applicable provisions of said Uniform Commercial Code upon such of the Property
that is or may become fixtures.
SECTION 1.5 PLEDGES OF MONIES HELD. Borrower hereby pledges to Lender
any and all monies now or hereafter held by Lender or on behalf of Lender,
including, without limitation, any sums deposited in the Lockbox Account or Cash
Management Account, the Reserve Funds and Net Proceeds, as additional security
for the Obligations until expended or applied as provided in this Security
Instrument.
SECTION 1.6 Grants to MERS. This Security Instrument and the grants,
assignments and transfers made to MFRS in this Article 1 shall inure to MERS
solely in its capacity as Lender's nominee.
CONDITIONS TO GRANT
TO HAVE AND TO HOLD the above granted and described Property
unto and to the use and benefit of Lender and its successors and assigns,
forever;
PROVIDED, HOWEVER, these presents are upon the express
condition that, if Borrower shall well and truly pay to Lender the Debt at the
time and in the manner provided in the Note, the Loan Agreement and this
Security Instrument, shall well and truly perform the Other Obligations as set
forth in this Security Instrument and shall well and truly abide by and comply
with each and every covenant and condition set forth herein and in the Note, the
Loan Agreement and the other Loan Documents, these presents and the estate
hereby granted shall cease, terminate and be void; provided, however, that
Borrower's obligation to indemnify and hold harmless Lender pursuant to the
provisions hereof shall survive any such payment or release.
ARTICLE 2 - DEBT AND OBLIGATIONS SECURED
SECTION 2.1 DEBT. This Security Instrument and the grants, assignments
and transfers made in Article I are given for the purpose of securing the Debt.
SECTION 2.2 OTHER OBLIGATIONS. This Security Instrument and the
grants, assignments and transfers made in Article I are also given for the
purpose of securing the following (the "Other Obligations"):
-6-
(a) the performance of all other obligations of Borrower
contained herein;
(b) the performance of each obligation of Borrower contained
in the Loan Agreement and any other Loan Document; and
(c) the performance of each obligation of Borrower contained
in any renewal, extension, amendment, modification, consolidation, change of, or
substitution or replacement for, all or any part of the Note, the Loan Agreement
or any other Loan Document.
SECTION 2.3 DEBT AND OTHER OBLIGATIONS. Borrower's obligations for the
payment of the Debt and the performance of the Other Obligations shall be
referred to collectively herein as the "Obligations."
ARTICLE 3 - BORROWER
COVENANTS Borrower covenants and agrees
that:
SECTION 3.1 PAYMENT OF DEBT. Borrower will pay the Debt at the time and
in the manner provided in the Loan Agreement, the Note and this Security
Instrument.
SECTION 3.2 INCORPORATION BY REFERENCE. All the covenants, conditions
and agreements contained in (a) the Loan Agreement, (b) the Note and (c) all and
any of the other Loan Documents, are hereby made a part of this Security
Instrument to the same extent and with the same force as if fully set forth
herein.
SECTION 3.3 INSURANCE. Borrower shall obtain and maintain, or cause to
be maintained, in full force and effect at all times insurance with respect to
Borrower and the Property as required pursuant to the Loan Agreement.
SECTION 3.4 MAINTENANCE OF PROPERTY. Borrower shall cause the Property
to be maintained in a good and safe condition and repair. The Improvements, the
Fixtures, the Equipment and the Personal Property shall not be removed,
demolished or materially altered (except for noinal replacement of the Fixtures,
the Equipment or the Personal Property, tenant finish and refurbishment of the
Improvements) without the consent of Lender. Borrower shall promptly repair,
replace or rebuild any part of the Property which may be destroyed by any
Casualty or become damaged, worn or dilapidated or which may be affected by any
Condemnation, and shall complete and pay for any structure at any time in the
process of construction or repair on the Land.
SECTION 3.5 WASTE. Borrower shall not commit or suffer any waste of the
Property or make any change in the use of the Property which will in any way
materially increase the risk of fire or other hazard arising out of the
operation of the Property, or take any action that might invalidate or allow the
cancellation of any Policy, or do or permit to be done thereon anything that may
in any way materially impair the value of the Property or the security of this
Security Instrument. Borrower will not, without the prior written consent of
Lender, permit any drilling or exploration for or extraction, removal, or
production of any minerals from the surface or the subsurface of the Land,
regardless of the depth thereof or the method of mining or extraction thereof.
SECTION 3.6 PAYMENT FOR LABOR AND MATERIALS.
(a) Borrower will promptly pay when due all bills and costs
for labor, materials, and specifically fabricated materials ("Labor and Material
Costs") incurred in connection with the Property and never permit to exist
beyond the due date thereof in respect of the Property or any part thereof any
lien or security interest, even though inferior to the liens and the security
interests hereof, and in any event never permit to be created or exist in
respect of the Property or any part thereof any other or additional lien or
security interest other than the liens or security interests hereof except for
the Permitted Encumbrances.
-7-
(b) After prior written notice to Lender, Borrower, at its own
expense, may contest by appropriate legal proceeding, promptly initiated and
conducted in good faith and with due diligence, the amount or validity or
application in whole or in part of any of the Labor and Material Costs, provided
that (i) no Event of Default has occurred and is continuing under the Loan
Agreement, the Note, this Security Instrument or any of the other Loan
Documents, (ii) Borrower is permitted to do so under the provisions of any other
mortgage, deed of trust or deed to secure debt affecting the Property, (iii)
such proceeding shall suspend the collection of the Labor and Material Costs
from Borrower and from the Property or Borrower shall have paid all of the Labor
and Material Costs under protest, (iv) such proceeding shall be permitted under
and be conducted in accordance with the provisions of any other instrument to
which Borrower is subject and shall not constitute a default thereunder, (v)
neither the Property nor any part thereof or interest therein will be in danger
of being sold, forfeited, terminated, canceled or lost, and (vi) Borrower shall
have furnished the security as may be required in the proceeding, or as may be
reasonably requested by Lender to insure the payment of any contested Labor and
Material Costs, together with all interest and penalties thereon.
SECTION 3.7 PERFORMANCE OF OTHER AGREEMENTS. Borrower shall observe and
perform each and every term, covenant and provision to be observed or performed
by Borrower pursuant to the Loan Agreement, any other Loan Document and any
other agreement or recorded instrument affecting or pertaining to the Property
and any amendments, modifications or changes thereto.
SECTION 3.8 CHANGE OF NAME, IDENTITY OR STRUCTURE. Borrower shall not
change Borrower's name, identity (including its trade name or names) or, if not
an individual, Borrower's corporate, partnership or other structure without
notifying Lender of such change in writing at least thirty (30) days prior to
the effective date of such change and, in the case of a change in Borrower's
structure, without first obtaining the prior written consent of Lender. Borrower
shall execute and deliver to Lender, prior to or contemporaneously with the
effective date of any such change, any financing statement or financing
statement change required by Lender to establish or maintain the validity,
perfection and priority of the security interest granted herein. At the request
of Lender, Borrower shall execute a certificate in form satisfactory to Lender
listing the trade names under which Borrower intends to operate the Property,
and representing and warranting that Borrower does business under no other trade
name with respect to the Property.
-8-
SECTION 3.9 TITLE. Borrower has good, marketable and insurable fee
simple title to the real property comprising part of the Property and good title
to the balance of such Property, free and clear all Liens (as defined in the
Loan Agreement) whatsoever except the Permitted Encumbrances (as defined in the
Loan Agreement), such other Liens as are permitted pursuant to the Loan
Documents and the Liens created by the Loan Documents. The Permitted
Encumbrances in the aggregate do not materially and adversely affect the value,
operation or use of the Property or Borrower's ability to repay the Loan. This
Security Instrument, when property recorded in the appropriate records, together
with any Uniform Commercial Code financing statements required to be filed in
connection therewith, will create (a) a valid, perfected first priority lien on
the Property, subject only to Permitted Encumbrances and the Liens created by
the Loan Documents and (b) perfected security interests in and to, and perfected
collateral assignments of, all personalty (including the Leases), all in
accordance with the terms thereof, in each case subject only to any applicable
Permitted Encumbrances, such other Liens as are permitted pursuant to the Loan
Documents and the Liens created by the Loan Documents. There are no claims for
payment for work, labor or materials affecting the Property which are past due
and are or may become a lien prior to, or of equal priority with, the Liens
created by the Loan Documents unless such claims for payments are being
contested in accordance with the terms and conditions of this Security
Instrument.
ARTICLE 4 - OBLIGATIONS AND RELIANCES
SECTION 4.1 RELATIONSHIP OF BORROWER AND LENDER. The relationship
between Borrower and Lender is solely that of debtor and creditor, and Lender
has no fiduciary or other special relationship with Borrower, and no term or
condition of any of the Loan Agreement, the Note, this Security Instrument and
the other Loan Documents shall be construed so as to deem the relationship
between Borrower and Lender to be other than that of debtor and creditor.
SECTION 4.2 NO RELIANCE ON LENDER. The general partners, members,
principals and (if Borrower is a trust) beneficial owners of Borrower are
experienced in the ownership and operation of properties similar to the
Property, and Borrower and Lender are relying solely upon such expertise and
business plan in connection with the ownership and operation of the Property.
Borrower is not relying on Lender's expertise, business acumen or advice in
connection with the Property.
SECTION 4.3 NO LENDER OBLIGATIONS.
(a) Notwithstanding the provisions of Subsections 1.1(h) and
(n) or Section 1.2, Lender is not undertaking the performance of (i) any
obligations under the Leases; or (ii) any obligations with respect to such
agreements, contracts, certificates, instruments, franchises, permits,
trademarks, licenses and other documents.
(b) By accepting or approving anything required to be
observed, performed or fulfilled or to be given to Lender pursuant to this
Security Instrument, the Loan Agreement, the Note or the other Loan Documents,
including, without limitation, any officer's certificate, balance sheet,
statement of profit and loss or other financial statement, survey, appraisal, or
insurance policy, Lender shall not be deemed to have warranted, consented to, or
affirmed the sufficiency, the legality or effectiveness of same, and such
acceptance or approval thereof shall not constitute any warranty or affirmation
with respect thereto by Lender.
-9-
SECTION 4.4 RELIANCE. Borrower recognizes and acknowledges that in
accepting the Loan Agreement, the Note, this Security Instrument and the other
Loan Documents, Lender is expressly and primarily relying on the truth and
accuracy of the warranties and representations set forth in Section 4.1 of the
Loan Agreement without any obligation to investigate the Property and
notwithstanding any investigation of the Property by Lender; that such reliance
existed on the part of Lender prior to the date hereof, that the warranties and
representations are a material inducement to Lender in making the Loan; and that
Lender would not be willing to make the Loan and accept this Security Instrument
in the absence of the warranties and representations as set forth in Section 4.1
of the Loan Agreement.
ARTICLE 5 - FURTHER ASSURANCES
SECTION 5.1 RECORDING OF MORTGAGE, ETC. Borrower forthwith upon the
execution and delivery of this Security Instrument and thereafter, from time to
time, will cause this Security Instrument and any of the other Loan Documents
creating a lien or security interest or evidencing the lien hereof upon the
Property and each instrument of further assurance to be filed, registered or
recorded in such manner and in such places as may be required by any present or
future law in order to publish notice of and fully to protect and perfect the
lien or security interest hereof upon, and the interest of Lender in, the
Property. Borrower will pay all taxes, filing, registration or recording fees,
and all expenses incident to the preparation, execution, acknowledgment and/or
recording of the Note, this Security Instrument, the other Loan Documents, any
note, deed of trust or mortgage supplemental hereto, any security instrument
with respect to the Property and any instrument of further assurance, and any
modification or amendment of the foregoing documents, and all federal, state,
county and municipal taxes, duties, imposts, assessments and charges arising out
of or in connection with the execution and delivery of this Security Instrument,
any deed of trust or mortgage supplemental hereto, any security instrument with
respect to the Property or any instrument of further assurance, and any
modification or amendment of the foregoing documents, except where prohibited by
law so to do.
SECTION 5.2 FURTHER ACTS, ETC. Borrower will, at the cost of Borrower,
and without expense to Lender, do, execute, acknowledge and deliver all and
every further acts, deeds, conveyances, deeds of trust, mortgages, assignments,
notices of assignments, transfers and assurances as Lender shall, from time to
time, reasonably require, for the better assuring, conveying, assigning,
transferring, and confirming unto Lender the property and rights hereby
mortgaged, deeded, granted, bargained, sold, conveyed, confirmed, pledged,
assigned, warranted and transferred or intended now or hereafter so to be, or
which Borrower may be or may hereafter become bound to convey or assign to
Lender, or for carrying out the intention or facilitating the performance of the
terms of this Security Instrument or for filing, registering or recording this
Security Instrument, or for complying with all Legal Requirements. Borrower, on
demand, will execute and deliver, and in the event it shall fail to so execute
and deliver, hereby authorizes Lender to execute in the name of Borrower or
without the signature of Borrower to the extent Lender may lawfully do so, one
or more financing statements to evidence more effectively the security interest
of Lender in the Property. Borrower grants to Lender an irrevocable power of
attorney coupled with an interest for the purpose of exercising and perfecting
any and all rights and remedies available to Lender at law and in equity,
including without limitation, such rights and remedies available to Lender
pursuant to this Section 5.2.
-10-
SECTION 5.3 CHANGES IN TAX, DEBT, CREDIT AND DOCUMENTARY STAMP LAWS.
(a) If any law is enacted or adopted or amended after the date
of this Security Instrument which deducts the Debt from the value of the
Property for the purpose of taxation or which imposes a tax, either directly or
indirectly, on the Debt or Lender's interest in the Property, Borrower will pay
the tax, with interest and penalties thereon, if any. If Lender is advised by
counsel chosen by it that the payment of tax by Borrower would be unlawful or
taxable to Lender or unenforceable or provide the basis for a defense of usury
then Lender shall have the option by written notice of not less than one hundred
twenty (120) days to declare the Debt immediately due and payable.
(b) Borrower will not claim or demand or be entitled to any
credit or credits on account of the Debt for any part of the Taxes or Other
Charges assessed against the Property, or any part thereof, and no deduction
shall otherwise be made or claimed from the assessed value of the Property, or
any part thereof, for real estate tax purposes by reason of this Security
Instrument or the Debt. If such claim, credit or deduction shall be required by
law, Lender shall have the option, by written notice of not less than one
hundred twenty (120) days, to declare the Debt immediately due and payable.
(c) If at any time the United States of America, any State
thereof or any subdivision of any such State shall require revenue or other
stamps to be affixed to the Note, this Security Instrument, or any of the other
Loan Documents or impose any other tax or charge on the same, Borrower will pay
for the same, with interest and penalties thereon, if any.
SECTION 5.4 SEVERING OF MORTGAGE. This Security Instrument and the
Note shall, at any time until the same shall be fully paid and satisfied, at the
sole election of Lender, be severed into two or more notes and two or more
security instruments in such denominations as Lender shall determine in its sole
discretion, each of which shall cover all or a portion of the Property to be
more particularly described therein. To that end, Borrower, upon written request
of Lender, shall execute, acknowledge and deliver, or cause to be executed,
acknowledged and delivered by the then owner of the Property, to Lender and/or
its designee or designees substitute notes and security instruments in such
principal amounts, aggregating not more than the then unpaid principal amount of
this Security Instrument, and containing teiiiis, provisions and clauses similar
to those contained herein and in the Note, and such other documents and
instruments as may be required by Lender.
SECTION 5.5 REPLACEMENT DOCUMENTS. Upon receipt of an affidavit of an
officer of Lender as to the loss, theft, destruction or mutilation of the Note
or any other Loan Document which is not of public record, and, in the case of
any such mutilation, upon surrender and cancellation of such Note or other Loan
Document, Borrower will issue, in lieu thereof, a replacement Note or other
Loan Document, dated the date of such lost, stolen, destroyed or mutilated Note
or other Loan Document in the same principal amount thereof and otherwise of
like tenor.
-11-
ARTICLE 6 - DUE ON SALE/ENCUMBRANCE
SECTION 6.1 LENDER RELIANCE. Borrower acknowledges that Lender has
examined and relied on the experience of Borrower and its general partners,
members, principals and (if Borrower is a trust) beneficial owners in owning and
operating properties such as 'the Property in agreeing to make the Loan, and
will continue to rely on Borrower's ownership of the Property as a means of
maintaining the value of the Property as security for repayment of the Debt and
the perfoiiuuance of the Other Obligations. Borrower acknowledges that Lender
has a valid interest in maintaining the value of the Property so as to ensure
that, should Borrower default in the repayment of the Debt or the performance of
the Other Obligations, Lender can recover the Debt by a sale of the Property.
SECTION 6.2 NO SALE/ENCUMBRANCE. Neither Borrower nor any Restricted
Party shall Transfer the Property or any part thereof or any interest therein or
permit or suffer the Property or any part thereof or any interest therein to be
Transferred other than as expressly peiuiitted pursuant to the terms of the Loan
Agreement.
ARTICLE 7 - RIGHTS AND REMEDIES UPON DEFAULT
SECTION 7.1, REMEDIES. Upon the occurrence and during the continuance
of any Event of Default, Borrower agrees that Lender may take such action,
without notice or demand, as it deems advisable to protect and enforce its
rights against Borrower and in and to the Property, including, but not limited
to, the following actions, each of which may be pursued concurrently or
otherwise, at such time and in such order as Lender may determine, in its sole
discretion, without impairing or otherwise affecting the other rights and
remedies of Lender:
(a) declare the entire unpaid Debt to be immediately due and
payable;
(b) institute proceedings, judicial or otherwise, for the
complete foreclosure of this Security Instrument under any applicable provision
of law, in which case the Property or any interest therein may be sold for cash
or upon credit in one or more parcels or in several interests or portions and in
any order or manner;
(c) with or without entry, to the extent permitted and
pursuant to the procedures provided by applicable law, institute proceedings for
the partial foreclosure of this Security Instrument for the portion of the Debt
then due and payable, subject to the continuing lien and security interest of
this Security Instrument for the balance of the Debt not then due, unimpaired
and without loss of priority;
(d) sell for cash or upon credit the Property or any part
thereof and all estate, claim, demand, right, title and interest of Borrower
therein and rights of redemption thereof, pursuant to power of sale or
otherwise, at one or more sales, as an entirety or in parcels, at such time and
place, upon such terms and after such notice thereof as may be required or
permitted by law;
(e) institute an action, suit or proceeding in equity for the
specific perfoiinrance of any covenant, condition or agreement contained herein,
in the Note, the Loan Agreement or in the other Loan Documents;
(f) recover judgment on the Note either before, during or
after any proceedings for the enforcement of this Security Instrument or the
other Loan Documents;
-12-
(g) apply for the appointment of a receiver, trustee,
liquidator or conservator of the Property, without notice and without regard for
the adequacy of the security for the Debt and without regard for the solvency of
Borrower, any Guarantor, Indemnifying Person with respect to the Loan or of any
Person liable for the payment of the Debt;
(h) the license granted to Borrower under Section 1.2 hereof
shall automatically be revoked and Lender may enter into or upon the Property,
either personally or by its agents, nominees or attorneys and dispossess
Borrower and its agents and servants therefrom, without liability for trespass,
damages or otherwise and exclude Borrower and its agents or servants wholly
therefrom, and take possession of all books, records and accounts relating
thereto and Borrower agrees to surrender possession of the Property and of such
books, records and accounts to Lender upon demand, and thereupon Lender may (i)
use, operate, manage, control, insure, maintain, repair, restore and otherwise
deal with all and every part of the Property and conduct the business thereat;
(ii) complete any construction on the Property in such manner and form as Lender
deems advisable; (iii) make alterations, additions, renewals, replacements and
improvements to or on the Property; (iv) exercise all rights and powers of
Borrower with respect to the Property, whether in the name of Borrower or
otherwise, including, without limitation, the right to make, cancel, enforce or
modify Leases, obtain and evict tenants, and demand, xxx for, collect and
receive all Rents of the Property and every part thereof; (v) require Borrower
to pay monthly in advance to Lender, or any receiver appointed to collect the
Rents, the fair and reasonable rental value for the use and occupation of such
part of the Property as may be occupied by Borrower; (vi) require Borrower to
vacate and surrender possession of the Property to Lender or to such receiver
and, in default thereof, Borrower may be evicted by summary proceedings or
otherwise; and (vii) apply the receipts from the Property to the payment of the
Debt, in such order, priority and proportions as Lender shall deem appropriate
in its sole discretion after deducting therefrom all expenses (including
reasonable attorneys' fees) incurred in connection with the aforesaid operations
and all amounts necessary to pay the Taxes, Other Charges, insurance and other
expenses in connection with the Property, as well as just and reasonable
compensation for the services of Lender, its counsel, agents and employees;
(i) exercise any and all rights and remedies granted to a
secured party upon default under the Uniform Commercial Code, including, without
limiting the generality of the foregoing: (i) the right to take possession of
the Fixtures, the Equipment, the Personal Property or any part thereof, and to
take such other measures as Lender may deem necessary for the care, protection
and preservation of the Fixtures, the Equipment, the Personal Property, and (ii)
request Borrower at its expense to assemble the Fixtures, the Equipment, the
Personal Property and make it available to Lender at a convenient place
acceptable to Lender. Any notice of sale, disposition or other intended action
by Lender with respect to the Fixtures, the Equipment, the Personal Property
sent to Borrower in accordance with the provisions hereof at least five (5) days
prior to such action, shall constitute commercially reasonable notice to
Borrower;
-13-
(j) apply any sums then deposited or held in escrow or
otherwise by or on behalf of Lender in accordance with the teiiiis of the Loan
Agreement, this Security Instrument or any other Loan Document to the payment of
the following items in any order in. its uncontrolled discretion:
(i) Taxes and Other Charges;
(ii) Insurance Premiums;
(iii)Interest on the unpaid principal balance of the
Note;
(iv)Amortization of the unpaid principal balance of
the Note;
(v) All other sums payable pursuant to the Note, the
Loan Agreement, this Security Instrument and the other Loan Documents,
including without limitation advances made by Lender pursuant to the
terms of this Security Instrument;
(k) pursue such other remedies as Lender may have under
applicable law; or
(1) apply the undisbursed balance of any Net Proceeds
Deficiency deposit, together with interest thereon, to the payment of the Debt
in such order, priority and proportions as Lender shall deem to be appropriate
in its discretion.
In the event of a sale, by foreclosure, power of sale or otherwise, of less than
all of Property, this Security Instrument shall continue as a lien and security
interest on the remaining portion of the Property unimpaired and without loss of
priority.
SECTION 7.2 APPLICATION OF PROCEEDS. The purchase money, proceeds and
avails of any disposition of the Property, and or any part thereof, or any other
sums collected by Lender pursuant to the Note, this Security Instrument or the
other Loan Documents, may be applied by Lender to the payment of the Debt in
such priority and proportions as Lender in its discretion shall deem proper.
SECTION 7.3 RIGHT TO CURE DEFAULTS. Upon the occurrence and during the
continuance of any Event of Default, Lender may, but without any obligation to
do so and without notice to or demand on Borrower and without releasing Borrower
from any obligation hereunder, make any payment or do any act required of
Borrower hereunder in such manner and to such extent as Lender may deem
necessary to protect the security hereof. Lender is authorized to enter upon the
Property for such purposes, or appear in, defend, or bring any action or
proceeding to protect its interest in the Property or to foreclose this Security
Instrument or collect the Debt, and the cost and expense thereof (including
reasonable attorneys' fees to the extent permitted by law), with interest as
provided in this Section 73, shall constitute a portion of the Debt and shall be
due and payable to Lender upon demand. All such costs and expenses incurred by
Lender in remedying such Event of Default or such failed payment or act or in
appearing in, defending, or bringing any such action or proceeding shall bear
interest at the Default Rate, for the period after notice from Lender that such
cost or expense was incurred to the date of payment to Lender. All such costs
and expenses incurred by Lender together with interest thereon calculated at the
Default Rate shall be deemed to constitute a portion of the Debt and be secured
by this Security Instrument and the other Loan Documents and shall be
immediately due and payable upon demand by Lender therefor.
SECTION 7.4 ACTIONS AND PROCEEDINGS. Lender has the right to appear in
and defend any action or proceeding brought with respect to the Property and to
bring any action or proceeding, in the name and on behalf of Borrower, which
Lender, in its discretion, decides should be brought to protect its interest in
the Property.
-14-
SECTION 7.5 RECOVERY OF SUMS REQUIRED TO BE PAID. Lender shall have the
right from time to time to take action to recover any sum or sums which
constitute a part of the Debt as the same become due, without regard to whether
or not the balance of the Debt shall be due, and without prejudice to the right
of Lender thereafter to bring an action of foreclosure, or any other action, for
a default or defaults by Borrower existing at the time such earlier action was
commenced.
SECTION 7.6 EXAMINATION OF BOOKS AND RECORDS. At reasonable times and
upon reasonable notice, Lender, its agents, accountants and attorneys shall have
the right to examine the records, books, management and other papers of Borrower
which reflect upon their financial condition, at the Property or at any office
regularly maintained by Borrower where the books and records are located. Lender
and its agents shall have the right to make copies and extracts from the
foregoing records and other papers. In addition, at reasonable times and upon
reasonable notice, Lender, its agents, accountants and attorneys shall have the
right to examine and audit the books and records of Borrower pertaining to the
income, expenses and operation of the Property during reasonable business hours
at any office of Borrower where the books and records are located. This Section
7.6 shall apply throughout the term of the Note and without regard to whether an
Event of Default has occurred or is continuing.
SECTION 7.7 OTHER RIGHTS, ETC. (a) The failure of Lender to insist upon
strict performance of any term hereof shall not be deemed to be a waiver of any
term of this Security Instrument. Borrower shall not be relieved of Borrower's
obligations hereunder by reason of (i) the failure of Lender to comply with any
request of Borrower or any Guarantor or Indemnifying Person with respect to the
Loan to take any action to foreclose this Security Instrument or otherwise
enforce any of the provisions hereof or of the Note or the other Loan Documents,
(ii) the release, regardless of consideration, of the whole or any part of the
Property, or of any person liable for the Debt or any portion thereof, or (iii)
any agreement or stipulation by Lender extending the time of payment or
otherwise modifying or supplementing the terms of the Note, this Security
Instrument or the other Loan Documents.
(a) It is agreed that the risk of loss or damage to the
Property is on Borrower, and Lender shall have no liability whatsoever for
decline in value of the Property, for failure to maintain the Policies, or for
failure to determine whether insurance in force is adequate as to the amount of
risks insured. Possession by Lender shall not be deemed an election of judicial
relief if any such possession is requested or obtained with respect to any
Property or collateral not in Lender's possession.
-15-
(b) Lender may resort for the payment of the Debt to any other
security held by Lender in such order and manner as Lender, in its discretion,
may elect. Lender may take action to recover the Debt, or any portion thereof,
or to enforce any covenant hereof without prejudice to the right of Lender
thereafter to foreclose this Security Instrument. The rights of Lender under
this Security Instrument shall be separate, distinct and cumulative and none
shall be given effect to the exclusion of the others. No act of Lender shall be
construed as an election to proceed under any one provision herein to the
exclusion of any other provision. Lender shall not be limited exclusively to the
rights and remedies herein stated but shall be entitled to every right and
remedy now or hereafter afforded at law or in equity.
SECTION 7.8 RIGHT TO RELEASE ANY PORTION OF THE PROPERTY. Lender may
release any portion of the Property for such consideration as Lender may require
without, as to the remainder of the Property, in any way impairing or affecting
the lien or priority of this Security Instrument, or improving the position of
any subordinate lienholder with respect thereto, except to the extent that the
obligations hereunder shall have been reduced by the actual monetary
consideration, if any, received by Lender for such release, and may accept by
assignment, pledge or otherwise any other property in place thereof as Lender
may require without being accountable for so doing to any other lienholder. This
Security Instrument shall continue as a lien and security interest in the
remaining portion of the Property.
SECTION 7.9 VIOLATION OF LAWS. If the Property is not in material
compliance with Legal Requirements, Lender may impose additional requirements
upon Borrower in connection herewith including, without limitation, monetary
reserves or financial equivalents.
SECTION 7.10 RECOURSE AND CHOICE OF REMEDIES. Notwithstanding any other
provision of this Security Instrument or the Loan Agreement, including, without
limitation, Section 9.4 of the Loan Agreement, Lender and other Indemnified
Parties (as hereinafter defined) are entitled to enforce the obligations of
Borrower, any Guarantor and Indemnifying Person contained in Sections 9.2 and
9.3 herein without first resorting to or exhausting any security or collateral
and without first having recourse to the Note or any of the Property, through
foreclosure or acceptance of a deed in lieu of foreclosure or otherwise, and in
the event Lender commences a foreclosure action against the Property, Lender is
entitled to pursue a deficiency judgment with respect to such obligations
against Borrower and any Guarantor or Indemnifying Person with respect to the
Loan. The provisions of Sections 9.2 and 9.3 herein are exceptions to any
nonrecourse or exculpation provisions in the Loan Agreement, the Note, this
Security Instrument or the other Loan Documents, and Borrower and any Guarantor
or Indemnifying Person with respect to the Loan are fully and personally liable
for the obligations pursuant to Sections 9.2 and 9.3 herein. The liability of
Borrower and any guarantor or indemnitor with respect to the Loan pursuant to
Sections 9.2 and 9.3 herein is not limited to the original principal amount of
the Note. Notwithstanding the foregoing, nothing herein shall inhibit or prevent
Lender from foreclosing or exercising any other rights and remedies pursuant to
the Loan Agreement, the Note, this Security Instrument and the other Loan
Documents, whether simultaneously with foreclosure proceedings or in any other
sequence. A separate action or actions may be brought and prosecuted against
Borrower pursuant to Sections 9.2 and 9.3 herein whether or not action is
brought against any other Person or whether or not any other Person is joined in
the action or actions. In addition, Lender shall have the right but not the
obligation to join and participate in, as a party if it so elects, any
administrative or judicial proceedings or actions ini fated in connection with
any matter addressed in Article 8 or Section 9.4 herein.
-16-
SECTION 7.11 RIGHT OF ENTRY. Upon reasonable notice to Borrower, Lender
and its agents shall have the right to enter and inspect the Property at all
reasonable times.
SECTION 7.12 REFERENCES TO LENDER. Notwithstanding anything to the
contrary contained herein or in any of the other Loan Documents, all references
herein to "Lender" shall be deemed to collectively or individually (as the
context requires) refer to Lender or to MERS, acting on behalf of and at the
sole direction of Lender in its capacity as Lender's nominee, as each of their
interests may appear; provided, that, unless Lender, in its sole discretion,
shall determine otherwise, only Lender (and not MERS) shall be deemed to be
"Lender" with respect to (a) any consent or similar approval right granted to
Lender hereunder or under any of the other Loan Documents (including, without
limitation, any consent or similar approval right that is deemed granted if not
approved or denied within a specified time period), (b) any items, documents or
other information required to be delivered to Lender hereunder or under any of
the other Loan Documents (other than notices expressly required to be sent to
MERS) or (c) any future funding or other obligations of Lender to Borrower or
any affiliate of Borrower hereunder or under any of the other Loan Documents, if
any.
SECTION 7.13 FAILURE TO ACT. Notwithstanding anything to the contrary
contained herein or in any of the other Loan Documents, the failure of MERS to
take any action hereunder or under any of the other Loan Documents shall not (a)
be deemed to be a waiver of any term or condition of this Security Instrument or
any of the other Loan Documents, or (b) adversely affect any rights of Lender
hereunder or under any of the other Loan Documents.
ARTICLE 8 - ENVIRONMENTAL HAZARDS
SECTION 8.1 ENVIRONMENTAL REPRESENTATIONS AND WARRANTIES. Except as
otherwise disclosed by that certain Phase I environmental report (or Phase II
environmental report, if required) delivered to Lender by Borrower in connection
with the origination of the Loan (such report is referred to below as the
"Environmental Report"), (a) there are no Hazardous Substances (defined below)
or underground storage tanks in, on, or under the Property, except those that
are (i) in compliance with Environmental Laws (defined below) and with permits
issued pursuant thereto (to the extent such peunits are required under
Environmental Law), (ii) de-minimis amounts necessary to operate the Property
for the purposes set forth in the Loan Agreement which will not result in an
environmental condition in, on or under the Property and which are otherwise
permitted under and used in compliance with Environmental Law and (iii) fully
disclosed to Lender in writing pursuant the Environmental Report; (b) there are
no past, present or threatened Releases (defined below) of Hazardous Substances
in, on, under or from the Property which has not been fully remediated in
accordance with Environmental Law; (c) there is no threat of any Release of
Hazardous Substances migrating to the Property; (d) there is no past or present
non-compliance with Environmental Laws, or with permits issued pursuant thereto,
in connection with the Property which has not been fully remediated in
accordance with Environmental Law; (e) Borrower does not know of, and has not
received, any written or oral notice or other communication from any Person
(including but not limited to a Governmental Authority) relating to Hazardous
Substances or Remediation (defined below) thereof, of possible liability of any
Person pursuant to any Environmental Law, other environmental conditions in
connection with the Property, or any actual or potential administrative or
judicial proceedings in connection with any of the foregoing; and (f) Borrower
has truthfully and fully disclosed provided to Lender, in writing, any and all
information relating to environmental conditions in, on, under or from the
Property that is known to Borrower and has provided to Lender all information
that is contained in Borrower's files and records, including, but not limited
to, any reports relating to Hazardous Substances in, on, under or from the
Property and/or to the environmental condition of the Property.
-17-
"ENVIRONMENTAL LAW" means any present and future federal,
state and local laws, statutes, ordinances, rules, regulations and the like, as
well as common law, relating to protection of human health or the environment,
relating to Hazardous Substances, relating to liability for or costs of
Remediation or prevention of Releases of Hazardous Substances or relating to
liability for or costs of other actual or threatened danger to human health or
the environment. Environmental Law includes, but is not limited to, the
following statutes, as amended, any successor thereto, and any regulations
promulgated pursuant thereto, and any state or local statutes, ordinances,
rules, regulations and the like addressing similar issues: the Comprehensive
Environmental Response, Compensation and Liability Act; the Emergency Planning
and Community Right-to-Know Act; the Hazardous Substances Transportation Act;
the Resource Conservation and Recovery Act (including but not limited to
Subtitle I relating to underground storage tanks); the Solid Waste Disposal Act;
the Clean Water Act; the Clean Air Act; the Toxic Substances Control Act; the
Safe Drinking Water Act; the Occupational Safety and Health Act; the Federal
Water Pollution Control Act; the Federal Insecticide, Fungicide and Rodenticide
Act; the Endangered Species Act; the National Environmental Policy Act; and the
River and Harbors Appropriation Act. Environmental Law also includes, but is not
limited to, any present and future federal, state and local laws, statutes,
ordinances, rules, regulations and the like, as well as common law: conditioning
transfer of property upon a negative declaration or other approval of a
governmental authority of the environmental condition of the Property; requiring
notification or disclosure of Releases of Hazardous Substances or other
environmental condition of the Property to any governmental authority or other
Person, whether or not in connection with transfer of title to or interest in
property; imposing conditions or requirements in connection with permits or
other authorization for lawful activity; relating to nuisance, trespass or other
causes of action related to the Property; or relating to wrongful death,
personal injury, or property or other damage in connection with any physical
condition or use of the Property.
"HAZARDOUS SUBSTANCES" include but are not limited to any and
all substances (whether solid, liquid or gas) defined, listed, or otherwise
classified as pollutants, hazardous wastes, hazardous substances, hazardous
materials, extremely hazardous wastes, or words of similar meaning or regulatory
effect under any present or future Environmental Laws or that may have a
negative impact on human health or the environment, including but not limited to
petroleum and petroleum products, asbestos and asbestos-containing materials,
polychlorinated biphenyls, lead, radon, radioactive materials, flammables and
explosives, but excluding substances of kinds and in amounts ordinarily and
customarily used or stored in similar properties for the purpose of cleaning or
other maintenance or operations and otherwise in compliance with all
Environmental Laws.
"RELEASE" of any Hazardous Substance includes but is not
limited to any release, deposit, discharge, emission, leaking, spilling,
seeping, migrating, injecting, pumping, pouring, emptying, escaping, dumping,
disposing or other movement of Hazardous Substances.
-18-
"REMEDIATION" includes but is not limited to any response,
remedial, removal, or corrective action, any activity to cleanup, detoxify,
decontaminate, contain or otherwise remediate any Hazardous Substance, any
actions to prevent, cure or mitigate any Release of any Hazardous Substance, any
action to comply with any Environmental Laws or with any permits issued pursuant
thereto, any inspection, investigation, study, monitoring, assessment, audit,
sampling and testing, laboratory or other analysis, or evaluation relating to
any Hazardous Substances or to anything referred to in Article 8.
SECTION 8.2 ENVIRONMENTAL COVENANTS. Borrower covenants and agrees
that: (a) all uses and operations on or of the Property, whether by Borrower or
any other Person, shall be in compliance with all Environmental Laws and permits
issued pursuant thereto; (b) there shall be no Releases of Hazardous Substances
in, on, under or from the Property; (c) there shall be no Hazardous Substances
in, on, or under the Property, except those that are (i) in compliance with all
Environmental Laws and with permits issued pursuant thereto (to the extent such
permits are required by Environmental Law), (ii) de-minimis amounts necessary to
operate the Property for the purposes set forth in the Loan Agreement which will
not result in an environmental condition in, on or under the Property and which
are otherwise permitted under and used in compliance with Environmental Law and
(iii) fully disclosed to Lender in writing; (d) Borrower shall keep the Property
free and clear of all liens and other encumbrances imposed pursuant to any
Environmental Law, whether due to any act or omission of Borrower or any other
Person (the "Environmental Liens"); (e) Borrower shall, at its sole cost and
expense, fully and expeditiously cooperate in all activities pursuant to Section
8.3 below, including but not limited to providing all relevant information and
making knowledgeable persons available for interviews; (f) Borrower shall, at
its sole cost and expense, perform any environmental site assessment or other
investigation of environmental conditions in connection with the Property,
pursuant to any reasonable written request of Lender made in the event that
Lender has reason to believe that an environmental hazard exists on the Property
(including but not limited to sampling, testing and analysis of soil, water,
air, building materials and other materials and substances whether solid, liquid
or gas), and share with Lender the reports and other results thereof, and Lender
and other Indemnified Parties shall be entitled to rely on such reports and
other results thereof; (g) Borrower shall, at its sole cost and expense, comply
with all reasonable written requests of Lender made in the event that Lender has
reason to believe that an environmental hazard exists on the Property (i)
reasonably effectuate Remediation of any condition (including but not limited to
a Release of a Hazardous Substance) in, on, under or from the Property; (ii)
comply with any Environmental Law; (iii) comply with any directive from any
Governmental Authority; and (iv) take any other reasonable action necessary or
appropriate for protection of human health or the environment; (h) Borrower
shall not do or allow any tenant or other user of the Property to do any act
that materially increases the dangers to human health or the environment, poses
an unreasonable risk of harm to any Person (whether on or off the Property),
impairs or may impair the value of the Property, is contrary to any requirement
of any insurer, constitutes a public or private nuisance, constitutes waste, or
violates any covenant, condition, agreement or easement applicable to the
Property; and (i) Borrower shall immediately notify Lender in writing of (A) any
presence or Releases or threatened Releases of Hazardous Substances in, on,
under, from or migrating towards the Property; (B) any non-compliance with any
Environmental Laws related in any way to the Property; (C) any actual or
potential Environmental Lien; (D) any required or proposed Remediation of
environmental conditions relating to the Property; and (E) any written or oral
notice or other communication of which Borrower becomes aware from any source
whatsoever (including but not limited to a governmental entity) relating in any
way to Hazardous Substances or Remediation thereof, possible liability of any
Person pursuant to any Environmental Law, other environmental conditions in
connection with the Property, or any actual or potential administrative or
judicial proceedings in connection with anything referred to in this Article 8.
-19-
SECTION 8.3 LENDER'S RIGHTS. In the event that Lender has reason to
believe that an environmental hazard exists on the Property that does not, in
Lender's sole discretion, endanger any tenants or other occupants of the
Property or their guests or the general public or materially and adversely
affect the value of the Property, upon reasonable notice from Lender, Borrower
shall, at Borrower's expense, promptly cause an engineer or consultant
satisfactory to Lender to conduct an environmental assessment or audit (the
scope of which shall be determined in Lender's sole and absolute discretion) and
take any samples of soil, groundwater or other water, air, or building materials
or any other invasive testing requested by Lender and promptly deliver the
results of any such assessment, audit, sampling or other testing; provided,
however, if such results are not delivered to Lender within a reasonable period
or if Lender has reason to believe that an environmental hazard exists on the
Property that, in Lender's sole judgment, endangers any tenant or other occupant
of the Property or their guests or the general public or may materially and
adversely affect the value of the Property, upon reasonable notice to Borrower,
Lender and any other Person designated by Lender, including but not limited to
any receiver, any representative of a governmental entity, and any environmental
consultant, shall have the right, but not the obligation, to enter upon the
Property at all reasonable times to assess any and all aspects of the
environmental condition of the Property and its use, including but not limited
to conducting any environmental assessment or audit (the scope of which shall be
determined in Lender's sole and absolute discretion) and taking samples of soil,
groundwater or other water, air, or building materials, and reasonably
conducting other invasive testing. Borrower shall cooperate with and provide
Lender and any such Person designated by Lender with access to the Property.
ARTICLE 9 - INDEMNIFICATION
SECTION 9.1 GENERAL INDEMNIFICATION. Borrower shall, at its sole cost
and expense, protect, defend, indemnify, release and hold harmless the
Indemnified Parties from and against any and all claims, suits, liabilities
(including, without limitation, strict liabilities), actions, proceedings,
obligations, debts, damages, losses, costs, expenses, diminutions in value,
fines, penalties, charges, fees, expenses, judgments, awards, amounts paid in
settlement, punitive damages, foreseeable and unforeseeable consequential
damages, of whatever kind or nature (including but not limited to reasonable
attorneys' fees and other costs of defense) (collectively, the "Losses") imposed
upon or incurred by or asserted against any Indemnified Parties and directly or
indirectly arising out of or in any way relating to any one or more of the
following: (a) ownership of this Security Instrument, the Property or any
interest therein or receipt of any Rents; (b) any amendment to, or restructuring
of, the Debt, the Note, the Loan Agreement, this Security Instrument, or any
other Loan Documents; (c) any and all lawful action that may be taken by Lender
in connection with the enforcement of the provisions of this Security
Instrument, the Loan Agreement, the Note or any of the other Loan Documents,
whether or not suit is filed in connection with same, or in connection with
Borrower, any Guarantor or Indemnifying Person and/or any partner, joint
venturer or shareholder thereof becoming a party to a voluntary or involuntary
federal or state bankruptcy, insolvency or similar proceeding; (d) any accident,
injury to or death of persons or loss of or damage to property occurring in, on
or about the Property or any part thereof or on the adjoining sidewalks, curbs,
adjacent property or adjacent parking areas, streets or ways; (e) any use,
nonuse or condition in, on or about the Property or any part thereof or on the
adjoining sidewalks, curbs, adjacent property or adjacent parking areas, streets
or ways; (f) any failure on the part of Borrower to perform or be in compliance
with any of the teinis of this Security Instrument, the Note, the Loan Agreement
or any of the other Loan Documents; (g) perfounnance of any labor or services or
the furnishing of any materials or other property in respect of the Property or
any part thereof; (h) the failure of any person to file timely with the Internal
Revenue Service an accurate Form 0000-X, Xxxxxxxxx for Recipients of Proceeds
from Real Estate, Broker and Barter Exchange Transactions, which may be required
in connection with this Security Instrument, or to supply a copy thereof in a
timely fashion to the recipient of the proceeds of the transaction in connection
with which this Security Instrument is made; (i) any failure of the Property to
be in compliance with any Legal Requirements; (j) the enforcement by any
Indemnified Party of the provisions of this Article 9; (k) any and all claims
and demands whatsoever which may be asserted against Lender by reason of any
alleged obligations or undertakings on its part to perform or discharge any of
the terms, covenants, or agreements contained in any Lease; (1) the payment of
any commission, charge or brokerage fee to anyone claiming through Borrower
which may be payable in connection with the funding of the Loan; or (m) any
misrepresentation made by Borrower in this Security Instrument or any other Loan
Document. Any amounts payable to Lender by reason of the application of this
Section 9.1 shall become immediately due and payable and shall bear interest at
the Default Rate from the date loss or damage is sustained by Lender until paid.
-20-
For purposes of this Article 9, the term "Indemnified Parties" means Lender and
any Person who is or will have been involved in the origination of the Loan, any
Person who is or will have been involved in the servicing of the Loan secured
hereby, any Person in whose name the encumbrance created by this Security
Instrument is or will have been recorded, any Person who may hold or acquire or
will have held a full or partial interest in the Loan secured hereby (including,
but not limited to, investors or prospective investors in the Securities, as
well as custodians, trustees and other fiduciaries who hold or have held a full
or partial interest in the Loan secured hereby for the benefit of third parties)
as well as the respective directors, officers, shareholders, partners,
employees, agents, servants, representatives, contractors, subcontractors,
affiliates, subsidiaries, participants, successors and assigns of any and all of
the foregoing (including, but not limited to, any other Person who holds or
acquires or will have held a participation or other full or partial interest in
the Loan, whether during the term of the Loan or as a part of or following a
foreclosure of the Loan and any successors by merger, consolidation or
acquisition of all or a substantial portion of Lender's assets and business).
SECTION 9.2 MORTGAGE AND/OR INTANGIBLE TAX. Borrower shall, at its sole
cost and expense, protect, defend, indemnify, release and hold harmless the
Indemnified Parties from and against any and all Losses imposed upon or incurred
by or asserted against any Indemnified Parties and directly or indirectly
arising out of or in any way relating to any tax on the making and/or recording
of this Security Instrument, the Note or any of the other Loan Documents, but
excluding any income, franchise or other similar taxes.
SECTION 9.3 ERISA INDEMNIFICATION. Borrower shall, at its sole cost and
expense, protect, defend, indemnify, release and hold harmless the Indemnified
Parties from and against any and all Losses (including, without limitation,
reasonable attorneys' fees and costs incurred in the investigation, defense, and
settlement of Losses incurred in correcting any prohibited transaction or in the
sale of a prohibited loan, and in obtaining any individual prohibited
transaction exemption under ERISA that may be required, in Lender's sole
discretion) that Lender may incur, directly or indirectly, as a result of a
default under Sections 4.1.9 or 5.2.12 of the Loan Agreement.
SECTION 9.4 ENVIRONMENTAL INDEMNIFICATION. Borrower shall, at its sole
cost and expense, protect, defend, indemnify, release and hold harmless the
Indemnified Parties from and against any and all Losses and costs of Remediation
(whether or not perfonned voluntarily), engineers' fees, environmental
consultants' fees, and costs of investigation (including but not limited to
sampling, testing, and analysis of soil, water, air, building materials and
other materials and substances whether solid, liquid or gas) imposed upon or
incurred by or asserted against any Indemnified Parties, and directly or
indirectly arising out of or in any way relating to any one or more of the
following: (a) any presence of any Hazardous Substances in, on, above, or under
the Property; (b) any past, present or threatened Release of Hazardous
Substances in, on, above, under or from the Property; (c) any activity by
Borrower, any Person affiliated with Borrower or any tenant or other user of the
Property in connection with any actual, proposed or threatened use, treatment,
storage, holding, existence, disposition or other Release, generation,
production, manufacturing, processing, refining, control, management, abatement,
removal, handling, transfer or transportation to or from the Property of any
Hazardous Substances at any tine located in, under, on or above the Property;
(d) any activity by Borrower, any Person affiliated with Borrower or any tenant
or other user of the Property in connection with any actual or proposed
Remediation of any Hazardous Substances at any time located in, under, on or
above the Property, whether or not such Remediation is voluntary or pursuant to
court or administrative order, including but not limited to any removal,
remedial or corrective action; (e) any past or present non-compliance or
violations of any Environmental Laws (or permits issued pursuant to any
Environmental Law) in connection with the Property or operations thereon,
including but not limited to any failure by Borrower, any Affiliate of Borrower
or any tenant or other user of the Property to comply with any order of any
Governmental Authority in connection with any Environmental Laws; (f) the
imposition, recording or filing of any Environmental Lien encumbering the
Property; (g) any administrative processes or proceedings or judicial
proceedings in any way connected with any matter addressed in Article 8 and this
Section 9.4; (h) any past, present or threatened injury to, destruction of or
loss of natural resources in any way connected with the Property, including but
not limited to costs to investigate and assess such injury, destruction or loss;
(i) any acts of Borrower or other users of the Property in arranging for
disposal or treatment, or arranging with a transporter for transport for
disposal or treatment, of Hazardous Substances owned or possessed by such
Borrower or other users, at any facility or incineration vessel owned or
operated by another Person and containing such or any similar Hazardous
Substance; (j) any acts of Borrower or other users of the Property, in accepting
any Hazardous Substance for transport to disposal or treatment facilities,
-21-
incineration vessels or sites selected by Borrower or such other users, from
which there is a Release, or a threatened Release of any Hazardous Substance
which causes the incurrence of costs for Remediation; (k) any personal injury,
wrongful death, or property damage arising under any statutory or common law or
tort law theory, including but not limited to damages assessed for the
maintenance of a private or public nuisance or for the conducting of an
abnormally dangerous activity on or near the Property; and (1) any
misrepresentation or inaccuracy in any representation or warranty or material
breach or failure to perform any covenants or other obligations pursuant to
Article 8. This indemnity shall survive any termination, satisfaction or
foreclosure of this Security Instrument, subject to the provisions of Section
10.5. Notwithstanding the foregoing, Borrower shall have no liability for any
Losses imposed upon or incurred by or asserted against any Indemnified Parties
and described in this Section 9.4 to the extent that such Losses arose solely by
actions, conditions or events relating to the Hazardous Substances placed in,
on, above or under the Property after the date that Lender (or any purchaser at
a foreclosure sale) actually acquired title to the Property and were not caused
by the direct or indirect actions of Borrower or any officer or director of
Borrower or any employee, agent, contractor or Affiliate of Borrower.
SECTION 9.5 DUTY TO DEFEND; ATTORNEYS' FEES AND OTHER FEES AND
EXPENSES. Upon written request by any Indemnified Party, Borrower shall defend
such Indemnified Party (if requested by any Indemnified Party, in the name of
the Indemnified Party) by attorneys and other professionals approved by the
Indemnified Parties. Notwithstanding the foregoing, if the defendants in any
such claim or proceeding include both Borrower and any Indemnified Party and
Borrower and such Indemnified Party shall have reasonably concluded that there
are any legal defenses available to it and/or other Indemnified Parties that are
different from or additional to those available to Borrower, such Indemnified
Party shall have the right to select separate counsel to assert such legal
defenses and to otherwise participate in the defense of such action on behalf of
such Indemnified Party, provided that no compromise or settlement shall be
entered without Borrower's consent, which consent shall not be unreasonably
withheld. Upon demand, Borrower shall pay or, in the sole and absolute
discretion of the Indemnified Parties, reimburse, the Indemnified Parties for
the payment of reasonable fees and disbursements of attorneys, engineers,
environmental consultants, laboratories and other professionals in connection
therewith.
ARTICLE 10 - WAIVERS
SECTION 10.1 WAIVER OF COUNTERCLAIM. To the extent permitted by
applicable law, Borrower hereby waives the right to assert a counterclaim, other
than a mandatory or compulsory counterclaim, in any action or proceeding brought
against it by Lender arising out of or in any way connected with this Security
Instrument, the Loan Agreement, the Note, any of the other Loan Documents, or
the Obligations.
SECTION 10.2 MARSHALLING AND OTHER MATTERS. To the extent permitted by
applicable law, Borrower hereby waives the benefit of all appraisement,
valuation, stay, extension, reinstatement and redemption laws now or hereafter
in force and all rights of marshalling in the event of any sale hereunder of the
Property or any part thereof or any interest therein. Further, Borrower hereby
expressly waives any and all rights of redemption from sale under any order or
decree of foreclosure of this Security Instrument on behalf of Borrower, and on
behalf of each and every person acquiring any interest in or title to the
Property subsequent to the date of this Security Instrument and on behalf of all
persons to the extent permitted by applicable law.
-22-
SECTION 10.3 WAIVER OF NOTICE. To the extent permitted by applicable
law, Borrower shall not be entitled to any notices of any nature whatsoever from
Lender except with respect to matters for which this Security Instrument
specifically and expressly provides for the giving of notice by Lender to
Borrower and except with respect to matters for which Lender is required by
applicable law to give notice, and Borrower hereby expressly waives the right to
receive any notice from Lender with respect to any matter for which this
Security Instrument does not specifically and expressly provide for the giving
of notice by Lender to Borrower.
SECTION 10.4 WAIVER OF STATUTE OF LIMITATIONS. To the extent pet titted
by applicable law, Borrower hereby expressly waives and releases to the fullest
extent permitted by law, the pleading of any statute of limitations as a defense
to payment of the Debt or performance of its Other Obligations.
SECTION 10.5 SURVIVAL. The indemnifications made pursuant to Sections
9.3 and 9.4 herein and the representations and warranties, covenants, and other
obligations arising under Article 8, shall continue indefinitely in full force
and effect and shall survive and shall in no way be impaired by any of the
following: any satisfaction or other teunination of this Security Instrument,
any assignment or other transfer of all or any portion of this Security
Instrument or Lender's interest in the Property (but, in such case, shall
benefit both Indemnified Parties and any assignee or transferee), any exercise
of Lender's rights and remedies pursuant hereto including, but not limited to,
foreclosure or acceptance of a deed in lieu of foreclosure, any exercise of any
rights and remedies pursuant to the Loan Agreement, the Note or any of the other
Loan Documents, an.y transfer of all or any portion of the Property (whether by
Borrower or by Lender following foreclosure or acceptance of a deed in lieu of
foreclosure or at any other time), any amendment to this Security Instrument,
the Loan Agreement, the Note or the other Loan Documents, and any act or
omission that might otherwise be construed as a release or discharge of Borrower
from the obligations pursuant hereto.
ARTICLE 11 - EXCULPATION
The provisions of Section 9.3 of the Loan Agreement are
hereby incorporated by reference into this Security Instrument to the same
extent and with the same force as if fully set forth herein.
ARTICLE 12 - NOTICES
All notices or other written communications hereunder shall
be delivered in accordance with Section 10.6 of the Loan Agreement.
Notices to Mortgagee hereunder and under any of the other
Loan Documents shall include a copy thereof to Lender (to be addressed and
delivered in accordance with this Section 10.6 of the Loan Agreement) and shall
be sent as follows:
Mortgagee: MERS Commercial
X.X. Xxx 0000
Xxxxx, Xxxxxxxx 00000-0000
-23-
ARTICLE 13 - APPLICABLE LAW
SECTION 13.1 GOVERNING LAW. This Security Instrument shall be governed
in accordance with the terms and provisions of Section 10.3 of the Loan
Agreement.
SECTION 13.2 USURY LAWS. Notwithstanding anything to the contrary, (a)
all agreements and communications between Borrower and Lender are hereby and
shall automatically be limited so that, after taking into account all amounts
deemed interest, the interest contracted for, charged or received by Lender
shall never exceed the maximum lawful rate or amount, (b) in calculating whether
any interest exceeds the lawful maximum, all such interest shall be amortized,
prorated, allocated and spread over the full amount and term of all principal
indebtedness of Borrower to Lender, and (c) if through any contingency or event,
Lender receives or is deemed to receive interest in excess of the lawful
maximum, any such excess shall be deemed to have been applied toward payment of
the principal of any and all then outstanding indebtedness of Borrower to
Lender, or if there is no such indebtedness, shall immediately be returned to
Borrower.
SECTION 13.3. PROVISIONS SUBJECT TO APPLICABLE LAW. All rights, powers
and remedies provided in this Security Instrument may be exercised only to the
extent that the exercise thereof does not violate any applicable provisions of
law and are intended to be limited to the extent necessary so that they will not
render this Security Instrument invalid, unenforceable or not entitled to be
recorded, registered or filed under the provisions of any applicable law. If any
term of this Security Instrument or any application thereof shall be invalid or
unenforceable, the remainder of this Security Instrument and any other
application of the term shall not be affected thereby.
ARTICLE 14 - DEFINITIONS
All capitalized terms not defined herein shall have the
respective meanings set forth in the Loan Agreement. Unless the context clearly
indicates a contrary intent or unless otherwise specifically provided herein,
words used in this Security Instrument may be used interchangeably in singular
or plural form and the word "Borrower" shall mean "each Borrower and any
subsequent owner or owners of the Property or any part thereof or any interest
therein," the word "Lender" shall mean "Lender and any subsequent holder of the
Note," the word "Note" shall mean "the Note and any other evidence of
indebtedness secured by this Security Instrument," the word "Property" shall
include any portion of the Property and any interest therein, and the phrases
"attorneys' fees", "legal fees" and "counsel fees" shall include any and all
attorneys', paralegal and law clerk fees and disbursements, including, but not
limited to, fees and disbursements at the pre-trial, trial and appellate levels
incurred or paid by Lender in protecting its interest in the Property, the
Leases and the Rents and enforcing its rights hereunder.
ARTICLE 15 - MISCELLANEOUS PROVISIONS
SECTION 15.1 NO ORAL CHANGE. This Security Instrument, and any
provisions hereof, may not be modified, amended, waived, extended, changed,
discharged or terminated orally or by any act or failure to act on the part of
Borrower or Lender, but only by an agreement in writing signed by the party
against whom enforcement of any modification, amendment, waiver, extension,
change, discharge or termination is sought.
-24-
SECTION 15.2 SUCCESSORS AND ASSIGNS. This Security Instrument shall be
binding upon and inure to the benefit of Borrower and Lender and their
respective successors and assigns forever.
SECTION 15.3 INAPPLICABLE PROVISIONS. If any term, covenant or
condition of the Loan Agreement, the Note or this Security Instrument is held to
be invalid, illegal or unenforceable in any respect, the Loan Agreement, the
Note and this Security Instrument shall be construed without such provision.
SECTION 15.4 HEADINGS, ETC. The headings and captions of various
Sections of this Security Instrument are for convenience of reference only and
are not to be construed as defining or limiting, in any way, the scope or intent
of the provisions hereof.
SECTION 15.5 NUMBER AND GENDER. Whenever the context may require, any
pronouns used herein shall include the corresponding masculine, feminine or
neuter focus, and the singular form of nouns and pronouns shall include the
plural and vice versa.
SECTION 15.6 SUBROGATION. If any or all of the proceeds of the Note
have been used to extinguish, extend or renew any indebtedness heretofore
existing against the Property, then, to the extent of the funds so used, Lender
shall be subrogated to all of the rights, claims, liens, titles, and interests
existing against the Property heretofore held by, or in favor of, the holder of
such indebtedness and such fotuier rights, claims, liens, titles, and interests,
if any, are not waived but rather are continued in full force and effect in
favor of Lender and are merged with the lien and security interest created
herein as cumulative security for the repayment of the Debt, the performance and
discharge of Borrower's obligations hereunder, under the Loan Agreement, the
Note and the other Loan Documents and the performance and discharge of the Other
Obligations.
SECTION 15.7 ENTIRE AGREEMENT. The Note, the Loan Agreement, this
Security Instrument and the other Loan Documents constitute the entire
understanding and agreement between Borrower and Lender with respect to the
transactions arising in connection with the Debt and supersede all prior written
or oral understandings and agreements between Borrower and Lender with respect
thereto. Borrower hereby acknowledges that, except as incorporated in writing in
the Note, the Loan Agreement, this Security Instrument and the other Loan
Documents, there are not, and were not, and no persons are or were authorized by
Lender to make, any representations, understandings, stipulations, agreements or
promises, oral or written, with respect to the transaction which is the subject
of the Note, the Loan Agreement, this Security Instrument and the other Loan
Documents.
SECTION 15.8 LIMITATION ON LENDER'S RESPONSIBILITY. No provision of
this Security Instrument shall operate to place any obligation or liability for
the control, care, management or repair of the Property upon Lender, nor shall
it operate to make Lender responsible or liable for any waste committed on the
Property by the tenants or any other Person, or for any dangerous or defective
condition of the Property, or for any negligence in the management, upkeep,
repair or control of the Property resulting in loss or injury or death to any
tenant, licensee, employee or stranger. Nothing herein contained shall be
construed as constituting Lender a "mortgagee in possession.
-25-
ARTICLE 16 - STATE-SPECIFIC PROVISIONS
SECTION 16.1 PRINCIPLES OF CONSTRUCTION. In the event of any
inconsistencies between the terms and conditions of this Article 16 and the
terms and conditions of this Security Instrument, the terms and conditions of
this Article 16 shall control and be binding.
SECTION 16.2 HAZARDOUS SUBSTANCES. Borrower shall not conduct or cause
or permit to be conducted on the Property any activity which constitutes an
Industrial Establishment (as such teen is defined in the New Jersey Industrial
Site Recovery Act, as amended ("ISRA")) without the prior written consent of
Lender, which consent shall not be unreasonably withheld. In the event that the
provisions of ISRA become applicable to the Property subsequent to the date
hereof, Borrower shall give prompt written notice thereof to Lender and shall
take immediate requisite action to insure compliance with ISRA. Borrower shall
deliver to Lender copies of all correspondence, notices and submissions that it
sends to or receives from the New Jersey Department of Environmental Protection
in connection with such ISRA compliance. Borrower's obligation to comply with
ISRA shall, notwithstanding its general applicability, also specifically apply
to sale, transfer, closure or termination of operations associated with any
foreclosure action respecting the Property, including, without limitation, a
foreclosure action brought with respect to this Security Instrument. Borrower
hereby represents and warrants to Lender the Property is not located within a
"freshwater wetlands" or a "transition area," each as defined by N.J.S.A.
13:9B-3, and is not subject to the terms of the New Jersey Freshwater Wetlands
Protection Act, as amended, N.J.S.A. 13:9B-1 et. Ms or the rules and regulations
promulgated thereunder.
SECTION 16.3 CONTINUING ENFORCEMENT OF SECURITY INSTRUMENT. If, after
receipt of any payment of all or any part of the obligations under the Note,
this Security Instrument, and the other Loan Documents, Lender is compelled or
agrees, for settlement purposes, to surrender such payment to any Person for any
reason (including, without limitation, a determination that such payment is void
or voidable as a preference or fraudulent conveyance, an impeiuniissible setoff,
or a diversion of trust funds), then this Security Instrument and the other Loan
Documents shall continue in full force and effect, and Borrower shall be liable
for, and shall indemnify, defend and hold harmless Lender with respect to the
full amount so surrendered. The provisions of this Section shall survive the
cancellation or discharge of this Security Instrument and shall remain effective
notwithstanding the payment of the obligations, under the Note, this Security
Instrument and the other Loan Documents, the cancellation of the Note, the
release of any security interest, lien or encumbrance securing the obligations
under the Note, this Security Instrument and the other Loan Documents, or any
other action which Lender may have taken in reliance upon its receipt of such
payment. Any cancellation, release or other such action by Lender shall be
deemed to have been conditioned upon any payment of the obligations under the
Note, this Security Instrument and the other Loan Documents, having become final
and irrevocable.
-26-
SECTION 16.4 MODIFICATION OF SECURITY INSTRUMENT. This Security
Instrument is subject to "modification" as such term is defined in P.L. 1985
c.353 (N.J.S.A. 46:9-8.1 et.see .} and shall be subject to the priority
provisions thereof.
SECTION 16.5 NO CREDIT FOR TAXES PAID. Borrower waives any right it may
have to a credit against interest due under the Debt secured by the Security
Instrument pursuant to N.J.S.A. 54:4 - 33.
SECTION 16.6 RECEIPT OF COPY. Borrower hereby acknowledges receipt of a
true copy of this Security Instrument without charge.
-27-
IN WITNESS WHEREOF, this Security Instrument has been executed by
Borrower as of the day and year first above written.
RD ELMWOOD ASSOCIATES, L.P.,
a Delaware limited partnership
BY: Aca ood Park LLC, Its ge
By:
--------------------------------
Name: Xxxxxx Xxxxxxx Title:
Senior Vice President
STATE OF NEW YORK COUNTY OF
On the_________, day of ~D 005, before me, the undersigned, a
Notary Public in and for said State, personally appeared
known to me on the basis of satisfactory evidence
to be the individual(s) whose name(s) is/are subscribed to the within instrument
and acknowledged that he/she/they executed the same in his/her/theix
capacity(ies), and that by his/her/their signature(s) on the instrument, the
individual(s), or the person upon behalf of which the individual(s) acted,
executed the instrument.
-28-
}
: ss.:
)
Iff.a.1
XXXXXXXXXX
ch0
Notary Public
B 5294P25-3,
EXHIBIT A
(LEGAL DESCRIPTION)
ALL that certain tract or parcel of land and premises, situate, lying and being
in the Borough of Elmwood Park, in the County of Bergen, and State of New
Jersey, more particularly described as .follows:
TRACT I (Lot 2, Block 301:
BEGINNING at a point in the westerly right-of-way line of Xxxxx Terrace (60 feet
wide), said point being measured South 19 degrees and 45 minutes and 40 seconds
East, a distance of 24.56 feet from the intersection of the said westerly
right-of-way line of Xxxxx Terrace with the southerly right-of-way line of New
Jersey State Highway Route 4, also known as Broadway (110 feet wide), and from
said point proceeding; thence
Continuing along the said westerly right-of-way line of lozia Terrace, South 19
degrees and 45 minutes and 40 seconds East, a distance of 275.92 feet to its
intersection with the northerly line of Lot 3 in Block 301; thence
(2) Departing the westerly right-of-way line of Xxxxx Terrace along the
northerly line of Xxxx 0 xxx X xx Xxxxx 000, Xxxxx 71 degrees and 11
minutes and 40 seconds West, a distance of 762.53 feet to the intersection
of the said northerly line of Lot 1 in Block 301 with the easterly
right-of-way line of Boulevard (70 feet wide) and a point of curvature;
thence
Continuing along the said easterly right-of-way line of Boulevard and a curve to
the right having a radius of 868.83 feet and a central angle of 00 degrees and
44 minutes and 50 seconds, and an arc length of 11.33 feet to a point; thence
(4) Continuing along the same, North 19 degrees and 11 minutes and 00 seconds
West, a distance of 264.77 feet to a point; thence
(1)
(3)
(5)
Continuing along the same and a curve to the right having a radius of 25.00
feet and a central angle of 90 degrees and 26 minutes and 30 seconds, a
distance along an arc of 39.46 feet to a point on the southerly
right-of-way line of New Jersey State Highway Route No. 4, also known as
Broadway; thence
(6) Along the said southerly right-of-way line of New Jersey State Highway
Route No. 4, also known as Broadway, North 71 degrees and 15 minutes and 30
seconds East, a distance of 709.83 feet to a point of curvature; thence
(7)
Continuing along the same and a curve to the right having a radius of 25.00
feet and a central angle of 88 degrees and 58 minutes and 50 seconds, a
distance along an arc of 38.83 feet to the point or place of BEGINNING.
EXH. A-i
NJOI /KEENP/68031.1
1529 P - 4
The above description is in accordance with a survey drawn by Xxxxxxx
Associates, Inc. dated November 17, 2005.
TRACT II (Lots 3 and 4. Block 201):
BEGINNING at a point in the westerly right-of-way line of Boulevard (70 feet
wide), said point being measured South 19 degrees and 11 minutes and 00 seconds
East, a distant of 24.81 feet from the intersection of the said westerly
right-of-way line of Boulevard with the southerly rightof-way line of New Jersey
State Highway Route 4, also known as Broadway (110 feet wide), and from said
point proceeding; thence,
(1)
Continuing along the said westerly right-of-way line of Boulevard, South 19
degrees and 11 minutes and 00 seconds East, a distance of 265.69 feet to a point
of curvature; thence
(2) Continuing along the same and a curve to the left having a radius of
938.83 feet and a central angle of 00 degrees and 39 minutes and 52
seconds, a distance along an arc of 10.89 feet to its intersection with
the northerly line of Lot 5 in Block 201; thence
(3)
Departing the westerly right-of-way line of Boulevard along the said
northerly line of Xxx 0 xx Xxxxx 000, Xxxxx 71 degrees and 11 minutes and
40 seconds West, a distance of 90.01 feet to an angle point; thence
(4) Continuing along the same, North 18 degrees and 48 minutes and 20 seconds
West, a distance of 1.10 feet to an angle point; thence
Continuing along the same, South 70 degrees and 12 minutes and 00 seconds West a
distance of 63.22 feet to an angle point; thence
(6) Continuing along the same, South 71 degrees and 11 minutes and 40 seconds
West, a distance of 436.87 feet to its intersection with the easterly line
of Lot 2 in Block 201; thence
Along the said easterly line of Xxx 0 xx Xxxxx 000, Xxxxx 19 degrees and 16
minutes and 30 seconds West, a distance of 300.00 feet to its intersection with
the southerly night-ofway line of New Jersey State Highway Route No. 4, also
known as Broadway; thence
Along the said southerly right-of-way line of New Jersey State Highway Route No.
4, also known as Broadway, North 70 degrees and 43 minutes and 30 seconds East,
a distance of 219.59 feet to an angle point in same; thence
Continuing along the same, North 71 degrees and 15 minutes and 30 seconds East,
a distance of 346.10 feet to a point of curvature; thence
(10) Continuing along the same and a curve to the right having a radius of
25.00 feet and a central angle of 89 degrees and 33 minutes and 30
seconds, a distance along an arc of39.08 feet to the point or place
of BEGINNING.
EXH. A-2
(5)
(7) (8)
(9)
The above description is in accordance with a survey drawn by Xxxxxxx
Associates, Inc. dated November 17, 2005.
Being known as Xxxx 0 & 0 xx Xxxxx 201, and Lot 2 in Block 301, on the Official
Tax Map of the Borough of Elmwood Park in the County of Bergen and State of New
Jersey. Being also known as 58, 80 and 000 Xxxxxxxx.
XXX. X-0
XX XXXXXXX ASSOCIATES, L.P., as Borrower
(Borrower)
to
MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., as nominee of Lender (Lender)
MORTGAGE AND
SECURITY AGREEMENT
Dated: As of December 9, 2005
Location: 000 Xxxxxxxx, X xxxxxx Xxxx Xxxxxxxx Xxxxxx, Xxxxxxx, XX
Xxxxxx: Bergen
MFRS MIN: 800010100000022938
PREPARED BY AND UPON RECORDATION RETURN TO:
LAND TITLE AGENCY, INC.
000 XXXXXX XXXXX XXXXXX
XXXXXXXXX, XX 00000
(000) 000.0000
