Exhibit 10.18
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MORTGAGE
By
XXXXXXX X. XXXX-XXXXXXXX
In Favor of
IIG EQUITY OPPORTUNITIES FUND LTD.
Dated: April 3, 2003
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Record and Return to: Xxxxxxxx Xxxxxxxx, Esq.
Loeb & Loeb LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
MORTGAGE
THIS MORTGAGE ("Mortgage"), made the 3 day of April, 2003 between XXXXXXX
X. XXXX-XXXXXXXX with a mailing address of 000 Xxxxx 000, Xxxxx Xxxxx, Xxx Xxxx
00000 ("Mortgagor") and IIG EQUITY OPPORTUNITIES FUND LTD., having offices at
0000 Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("Mortgagee"),
WITNESSETH, that to secure the payment to the extent of Two Hundred and
Seventy Five Thousand and 00/100 Dollars ($275,000) lawful money of the United
States of America of all sums which may now or hereafter be owing by the
Mortgagor to the Mortgagee pursuant to that certain Limited Guaranty dated as of
the date hereof made by Mortgagor in favor of Mortgagee (as amended, restated,
extended, modified, supplemented and substituted the "Guaranty") pursuant to
which Mortgagor has guaranteed to Mortgagee the payment of all of the
obligations and the indebtedness evidenced by a certain Term Loan and Security
Agreement dated as of the date hereof among Frontline Communications
Corporation, Proyecciones y Ventas Organizadas, S.A. de C.V. (collectively,
"Borrowers") and Mortgagee (as such may hereafter be amended, restated,
extended, modified or substituted for the "Loan Agreement") and which Guaranty
is by this reference made a part hereof as said Guaranty may be amended,
extended, renewed or substituted for, and any and all sums, amounts and expenses
paid hereunder or thereunder by the Mortgagee according to the terms hereof and
all other obligations and liabilities of the Mortgagor under this Mortgage and
the Guaranty, together with all interest on the said indebtedness, obligations,
liabilities, sums, amounts and expenses and any and all other obligations and
liabilities now due and owing or which may hereafter be or become due and owing
by the Mortgagor to the Mortgagee hereunder or under the Guaranty, provided,
however, that the maximum principal sum secured by this Mortgage at execution or
which under any contingency may be secured hereby at any time in the future
shall not exceed the principal sum stated above and provided, further, that any
payments made from time to time in reduction of the principal amount of the
Obligations (as such term is defined in the Guaranty) shall be applied first in
reduction of that portion of the Obligations in excess of the sum secured
hereby, in such order as Mortgagee shall elect, it being the intention of the
Mortgagor and the Mortgagee that the payments in reduction of the Obligations
shall not reduce the sums secured hereby until such time as (a) the Obligations
shall have been reduced to Two Hundred and Seventy Thousand and 00/100 Dollars
($275,000) or less and (b) the Mortgagee shall have no further obligation to
make loans to Borrowers under the Loan Agreement, the Mortgagor hereby mortgages
to the Mortgagee and grants to the Mortgagee a security interest in:
All that certain plot, piece or parcel of land, with the buildings and
improvements thereon erected, situate, lying and being at 00 Xxxxx Xxxx in the
Town of Stony Point, County of Rockland and State of New York, bounded and
described on Exhibit A attached hereto and made a part hereof, together with:
All right, title and interest of the Mortgagor in and to the land lying in
the streets and road in front of and adjoining said premises;
All fixtures, chattels and articles of personal property now or hereafter
attached to or used in connection with said premises, including but not limited
to furnaces, boiler, oil burners,
radiators and piping, coal stokers, plumbing and bathroom fixtures,
refrigeration, air conditioning and sprinkler systems, wash tubs, sinks, gas and
electric fixtures, stoves, ranges, awnings, screens, windows shades, elevators,
motors, dynamos, refrigerators, kitchen cabinet, incinerators, plants and
shrubbery and all other equipment and machinery, appliances, fittings, and
fixtures of every kind in or used in the operation of the buildings standing on
said premises, together with any and all replacements thereof and additions
thereto; and
All awards heretofore and hereafter made to the Mortgagor for taking by
eminent domain the whole or any part of said premises or any easement therein,
including any awards for changes of grade of streets, which said awards are
hereby assigned to the Mortgagee, who is hereby authorized to collect and
receive the proceeds of such awards and to give proper receipts and acquittances
therefor, and to apply the same toward the payment of the mortgage debt,
notwithstanding the fact that the amount owing thereon may not then be due and
payable; and the said Mortgagor hereby agrees, upon request, to make, execute
and deliver any and all assignments and other instruments sufficient for the
purpose of assigning said awards to the Mortgagee, free, clear and discharged of
any encumbrances of any kind or nature whatsoever.
And the Mortgagor covenants with the Mortgagee as follows:
1. That the Mortgagor will pay the indebtedness as hereinbefore provided.
2. That the Mortgagor will keep the buildings on the premises insured
against loss by fire for the benefit of the Mortgagee; that he will assign and,
upon the request of the Mortgagee, deliver the policies to the Mortgagee; and
that he will reimburse the Mortgagee for any premiums paid for insurance made by
the Mortgagee on the Mortgagor's default in so insuring the buildings or in so
assigning and delivering the policies.
3. That no building on the premises shall be substantially altered, removed
or demolished without the consent of the Mortgagee.
4. That the whole of said principal sum and interest shall become due at
the option of the Mortgagee upon the occurrence of any of the following events:
(a) if Mortgagor shall default in the payment of any amounts payable
by Mortgagor under the Guaranty; or
(b) if Mortgagor shall default in the performance of any other
obligation of Mortgagor hereunder.
5. That the holder of this Mortgage, in any action to foreclose it, shall
be entitled to the appointment of a receiver.
6. That the Mortgagor will pay all taxes, assessments, sewer rents or water
rates, and in default thereof, the Mortgagee may, but shall not have the
obligation to, pay the same at the expense of Mortgagor.
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7. That the Mortgagor within five (5) days upon request in person or within
ten (10) days upon request by mail will furnish a written statement duly
acknowledged of the amount due on this Mortgage and whether any offsets or
defenses exist against the mortgage debt.
8. That notice and demand or request may be in writing and may be served in
person or by certified mail, return receipt requested.
9. That the Mortgagor warrants the title to the premises.
10. That the fire insurance policies required by paragraph No. 2 above
shall contain the usual extended coverage endorsement; that in addition thereto
the Mortgagor, within thirty days after notice and demand, will keep the
premises insured against war risk and any other hazard that may reasonably be
required by the Mortgagee. All of the provisions of paragraph No. 2 above
relating to fire insurance and the provisions of Section 254 of the Real
Property Law construing the same all apply to the additional insurance required
by this paragraph.
11. That in case of a foreclosure sale, said premises, or so much thereof
as may be affected by this Mortgage, may be sold in one parcel.
12. That if any action or proceeding be commenced (except an action to
foreclose this Mortgage or to collect the debt secured thereby), to which action
or proceeding the Mortgagee is made a party or in which it becomes necessary to
defend or uphold the lien of this Mortgage, all sums paid by the Mortgagee for
the expense of any litigation to prosecute or defend the rights and lien created
by this Mortgage (including reasonable counsel fees), shall be paid by the
Mortgagor, together with interest thereon at the rate of twelve per cent, per
annum, and any such sum and the interest thereon shall be a lien on said
premises, prior to any right, or title to, interest in or claim upon said
premises attaching or accruing subsequent to the lien of this Mortgage, and
shall be deemed to be secured by this Mortgage. In any action or proceeding to
foreclose this Mortgage, or to recover or collect the debt secured thereby, the
provisions of law respecting the recovering of costs, disbursements and
allowances shall prevail, unaffected by this covenant.
13. That the Mortgagor hereby assigns to the Mortgagee the rents, issues
and profits of the premises, and the Mortgagor grants to the Mortgagee the right
to enter upon and take possession of the premises for the purpose of collecting
the same and to let the premises or any part thereof, and to apply the rents,
issues and profits, after payment of all necessary charges and expenses, on
account of said indebtedness. This assignment and grant shall continue in effect
until this Mortgage is paid. Until a default by the Mortgagor, the Mortgagee
hereby waives the right to enter upon and take possession of said premises for
the purpose of collecting said rents, issues and profits, and the Mortgagor
shall be entitled to collect and receive said rents, issues and profits until
default under any of the covenants, conditions or agreements contained in this
Mortgage and agrees to use such rents, issues and profits in payment of
principal and interest becoming due on this Mortgage and in payment of taxes,
assessments, sewer rents, water rates and carrying charges becoming due against
said premises, but such right of the Mortgagor may be revoked by the Mortgagee
upon any default. The Mortgagor will not, without the written consent of the
Mortgagee, receive or collect rent from any tenant of said premises or any part
thereof for a period of more than one month in advance, and in the event of any
default under this Mortgage will pay monthly in advance to the Mortgagee, or to
any receiver appointed to
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collect said rents, issues and profits, the fair and reasonable rental value for
the use and occupation of said premises or of such part thereof as may be in the
possession of the Mortgagor, and upon default in any such payment will vacate
and surrender the possession of said premises to the Mortgagee or to such
receiver, and in default thereof may be evicted by summary proceedings.
14. That the whole of said principal sum and the interest shall become due
at the option of the Mortgagee: (a) after failure to exhibit to the Mortgagee,
within thirty days after demand, receipts showing payment of all taxes, water
rates, sewer rents and assessments; or (b) after the actual or threatened
alteration, demolition or removal of any building on the premises without the
written consent of the Mortgagee or if the Mortgagor shall further encumber the
premises or any interest therein; or (c) after the assignment of the rents of
the premises or any part thereof without the written consent of the Mortgagee;
or (d) if the buildings on said premises are not maintained in reasonably good
repair; or (e) after failure to comply with any requirement or order or notice
of violation of law or ordinance issued by any governmental department claiming
jurisdiction over the premises within three months from the issuance thereof; or
(f) in the event of the removal, demolition or destruction in whole or in part
of any of the fixtures, chattels or articles of personal property covered hereby
unless the same are promptly replaced by similar fixtures, chattels and articles
or personal property at least equal in quality and condition to those replaced,
free from chattel mortgages or other encumbrances thereon and free from any
reservation of title thereto; or (g) after thirty days' notice to the Mortgagor,
in the event of the passage of any law deducting from the value of land for the
purpose of taxation any lien thereon, or changing in any way the taxation of
mortgages or debts secured thereby for state or local purposes; or (h) if all or
any part of the premises or an interest therein is sold, conveyed or otherwise
transferred by Mortgagor without Mortgagee's prior written consent; or (i) if
the Mortgagor fails to keep, observe and perform any of the other covenants,
conditions or agreements contained in this Mortgage and/or Lease.
15. That the Mortgagor will, in compliance with Section 13 of the Lien Law,
receive the advances secured hereby and will hold the right to receive such
advances as a trust fund to be applied first for the purpose of paying the cost
of the improvement and will apply the same first to the payment of the cost of
the improvement before using any part of the total of the same for any other
purpose.
16. That the premise herein mortgaged is of a nature so that a security
interest can be perfected under the Uniform Commercial Code, as in effect from
time to time in the State of New York (the "UCC"), this instrument shall
constitute a security agreement and Mortgagor authorizes Mortgagee to file any
financing statements and to execute any other instruments that may be required
for the perfection or renewal of such security interest under the UCC. A
satisfaction of this Mortgage, when recorded, shall constitute a satisfaction of
any financing statement filed in connection with this instrument, or renewal
thereof.
17. This Mortgage may not be changed or terminated orally. The covenants
contained in this Mortgage shall run with the land and bind the Mortgagor,
successors and assigns of the Mortgagor and all subsequent owners,
encumbrancers, tenants and subtenants of the premises, and shall inure to the
benefit of the Mortgagee, the personal representatives, successors and assigns
of the Mortgagee and all subsequent holders of this Mortgage. The word
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"Mortgagor" shall be construed as if it read "Mortgagors" and the word
"Mortgagee" shall be construed as if it read " Mortgagees" whenever the sense of
this Mortgage so requires.
18. The Mortgagor, for himself and his successors and assigns, waives trial
by jury and the right thereto in any action or proceeding of any kind arising
on, out of, or by reason of, or relating in any way to the Guaranty or this
Mortgage.
19. If any default shall occur hereunder or any sums due under the Guaranty
not be paid in full when due, then (1) beginning on the date of such default,
interest shall continue to be computed and shall be paid by the Mortgagor at the
default rate provided by the Guaranty; and (2) if the Mortgagee or its
successors or assigns retains attorneys to xxx under the Guaranty or to
foreclose this Mortgage; or one or more of the foregoing, the Mortgagor shall
pay the reasonable fees of Mortgagee's attorneys and all disbursements incurred
by them. This Mortgage shall also secure the full payment of any such interest,
reasonable attorneys' fees and disbursements which may become payable; and the
amount thereof shall be a lien upon the Premises, in the same manner and with
the same force as if that interest and those fees and disbursements were part of
the original principal sum secured by this Mortgage. Such interest, fees and
disbursements shall be payable by Mortgagor in addition to any court costs or
allowances to which the Mortgagee or its successors or assigns may be entitled.
20. The failure of the Mortgagee to seek redress for any default under this
Mortgage, or to insist upon the strict performance of any covenant or condition
of this Mortgage shall not prevent any subsequent act or omission of the
Mortgagor which constitutes a default from having all the force and effect of a
default. The receipt by the Mortgagee of any payment, with knowledge of the
violation or default of any covenant or condition of this Mortgage, shall not be
deemed a waiver of such violation or default, nor shall the Mortgagee's
acceptance of any payment after the expiration of any grace period relating
thereto be deemed to estop the Mortgagee from exercising its rights with respect
to any default arising hereafter out of any other late payment. No provision of
this Mortgage shall be deemed to have been waived by the Mortgagee unless the
waiver is in writing and signed by the Mortgagee.
21. No delay or omission by the Mortgagee in exercising any right, power or
remedy accruing under this Mortgage shall be or be deemed to be a waiver of any
default, or acquiescence thereto. A waiver of any default in any one or more
instances shall not be deemed a waiver, in any manner or to any extent, of any
subsequent default.
22. The Mortgagor shall pay any and all mortgage recording taxes in
connection with the recording of this Mortgage.
23. The Mortgagor shall do, execute, acknowledge and deliver, at the sole
cost and expense of the Mortgagor, all and every such further acts, deeds,
conveyances, mortgages, assignments, estoppel certificates, notices of
assignment, transfers and assurances as the Mortgagee or its counsel may require
from time to time in order to better assure, convey, grant, assign, transfer and
confirm unto the Mortgagee, the rights now or hereafter intended to be granted
to the Mortgagee under this Mortgage, any other instrument executed in
connection with this Mortgage or any other instrument under which the Mortgagor
may be or may hereafter
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become bound to convey, mortgage or assign to the Mortgagee for carrying out the
intention of facilitating the performance of the terms of this Mortgage.
[THE REMAINDER OF THIS PAGE WAS INTENTIONALLY LEFT BLANK.]
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IN WITNESS WHEREOF, this Mortgage has been duly executed by the Mortgagor.
MORTGAGOR:
/s/
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XXXXXXX X. XXXX-XXXXXXXX
State of New York )
) ss.:
County of ______ )
On the ___ day of April in the year two thousand and three, before me, the
undersigned, personally appeared Xxxxxxx X. Xxxx-Xxxxxxxx, personally known to
me or proved to me on the basis of satisfactory evidence to the individual whose
name is subscribed to the within instrument and acknowledged to me that he
executed the same in his capacity and that by his signature on the instrument,
the individual or the person upon behalf of which the individual acted executed
the instrument.
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Notary Public
