1
Record and Return to:
Xxxxxx Beach pllc
Recording Fee: $ 70.00
Mortgage Tax: $ 3,656.00
Spec. Mtg. Tax: $ 1,828.00
Tax Map No.: 96-2-1.9
XXXXXXXX TRUST COMPANY CONSOLIDATED
LEASEHOLD MORTGAGE
Ithaca, New York
October 2, 2006
THIS MORTGAGE made October 2, 2006, by EVAPORATED METAL
FILMS CORP. a New York corporation, maintaining its office at 000
Xxxxxx Xxxxxx, Xxxxxx, Xxx Xxxx 00000 ("Company"), and XXXXXXXX
TRUST COMPANY, a New York banking corporation with offices at 000
Xxxxx Xxxxx Xxxxxx, Xxxxxx, Xxx Xxxx 00000 ("Mortgagee"),
W I T N E S S E T H :
That to secure the payment of Company's indebtedness to
Mortgagee, outstanding from time to time, up to the maximum
principal sum of SEVEN HUNDRED THIRTY-ONE THOUSAND ONE HUNDRED
EIGHTY-FIVE AND 71/100 DOLLARS ($731,185.71) secured hereby in
lawful money of the United States of America, (said indebtedness,
interest and all other sums which may or shall become due
hereunder being hereinafter collectively referred to as the
"Debt") according to a certain commercial line of credit
agreement and any extensions or renewals thereof (the "Note")
entered into by and between Company and Mortgagee concurrently
herewith, Company hereby mortgages to the Mortgagee all right,
title and interest of Company in and to the property described in
Schedule A attached hereto (the "Premises"), pursuant to a ground
lease by and between the Ithaca Urban Renewal Agency, as lessor,
and Evaporated Metal Films Corp. (incorrectly designated as
Evaporated Metal Films, Inc., as a result of a clerical error),
as lessee, dated May 26, 1988, and amended on August 12, 1988,
and recorded in the Xxxxxxxx County Clerk's Office in Liber 637
of Deeds at page 231 and Liber 639 of Deeds at page 531,
respectively, (the lease being referred to herein as the "Ground
Lease"), and the buildings, structures, fixtures and improvements
now or hereafter located thereon (the "Improvements").
TOGETHER WITH all right, title and interest of Company
in and to the following property, rights and interests (the
Premises and the Improvements together with such property, rights
and interests being hereinafter collectively called the
"Mortgaged Property");
(a) all easements, rights-of-way, gores of land, streets,
ways, alleys, passages, sewer rights, waters, water courses,
water rights and powers, and all estates, rights, titles,
interests, privileges, liberties, tenements, hereditaments, and
appurtenances of any nature whatsoever, in any way belonging,
relating or pertaining to the Mortgaged Property and all land
lying in the bed of any street, road or avenue, opened or
proposed, in front of or adjoining the Premises to the center
line thereof;
(b) all fixtures and articles of personal property now or
hereafter owned by the Company and affixed to, or appurtenant to
or used in connection with the operation of, the Mortgaged
Property;
(c) all awards or payments, including interest thereon, and
the right to receive the same, which may be made with respect to
the Mortgaged Property, whether from the exercise of the right of
eminent domain (including any transfer made in lieu of the
exercise of said right), or for any other injury to or decrease
in the value of the Mortgaged Property;
(d) all leases, subleases and other agreements affecting
the use or occupancy of the Mortgaged Property now or hereafter
entered into (the "Leases") and the right to receive and apply
the rents, issues and profits of the Mortgaged Property (the
"Rents") to the payment of the Debt;
(e) all proceeds of and any unearned premiums on any
insurance policies covering the Mortgaged 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 Mortgaged Property;
(f) the right, in the name and on behalf of Company to
appear in and defend any action or proceeding brought with
respect to the Mortgaged Property and to commence any action or
proceeding to protect the interest of Mortgagee in the Mortgaged
Property.
TO HAVE AND TO HOLD the above granted and described
Mortgaged Property unto and to the proper use and benefits of
Mortgagee, and the successors and assigns of Mortgagee, forever.
Company covenants, agrees, warrants and represents to
Mortgagee as follows:
1. Payment of Debt. Company will pay the Debt at the time and
in the manner provided for in the Note and in this Mortgage.
2. Warranty of Title. Company warrants that (i) the Ground
Lease is a valid and subsisting lease of the Premises, demised
for the term set forth, is in full force and effect in accordance
with its terms, has not been modified, and there are no existing
or anticipated defaults or offsets by the Ground Lessor or by the
Company thereunder, (ii) the Company is the owner and holder of
the Ground Lease and of the leasehold estates created thereby,
(iii) all sublease(s) in effect affecting the Premises are: (a)
subordinate to this Mortgage, or (b) contain non-disturbance and
attornment provisions, (iv) the Ground Lessor has good and
marketable title to and indefeasible fee title in the Premises
free and clear of all liens and encumbrances subject only to
Permitted Encumbrances as defined in the Building Loan Agreement
and the Ground Lease and (v) Company has title to all buildings
and other leasehold improvements on the Premises.
3. Insurance. Company will keep the Mortgaged Property insured
against loss or damage by fire, flood and such other risks and
matters, including without limitation, business interruption,
rental loss, public liability and boiler insurance, as Mortgagee
shall from time to time require in amounts required by Mortgagee,
not exceeding in the aggregate 100% of the full insurable value
of the Mortgaged Property and shall pay the premiums for such
insurance as same become due and payable. Notwithstanding the
foregoing, Mortgagee acknowledges and agrees that the insurance
policies currently maintained by the Company are such as are
currently required by Mortgagee. All policies for such insurance
(the "Policies") shall be issued by insurance companies rated A
or better by A. M. Best Company, Inc. in Best's Key Rating Guide
selected by the Company and shall contain the standard New York
mortgagee non-contribution clause endorsement naming Mortgagee as
the person to which all payments made by such insurance company
shall be paid. Company will assign and deliver the Policies or
certificates evidencing the required coverage to Mortgagee. Not
later than fifteen (15) days prior to the expiration date of each
of the Policies, Company will deliver to Mortgagee satisfactory
evidence of the renewal of each of the Policies. If the
Mortgaged Property shall be damaged or destroyed, in whole or in
part, by fire, or other casualty, Company shall give prompt
notice thereof to Mortgagee. If Company is not in default under
this Mortgage, Building Loan Agreement or the Note, and if
promptly after the insurance claims are settled, and the Company
obtains the permits required and Company proceeds with the
restoration, replacement, rebuilding or repair (hereinafter
collectively referred to as "Restoration") of the Mortgaged
Property as nearly as possible to the condition the Mortgaged
Property was in immediately prior to such fire or other casualty,
the net amount of all insurance proceeds received by Mortgagee
with respect to such damage or destruction after deduction of its
reasonable costs and expenses, if any, in collecting the same
(hereinafter referred to as the "Net Proceeds") will be disbursed
by Mortgagee to pay for the costs and expenses of Restoration.
The Net Proceeds shall be held in trust without obligation on
Mortgagee to pay interest thereon and shall be paid by Mortgagee
to, or as directed by, Company from time to time during the
course of the Restoration, upon receipt of evidence, satisfactory
to Mortgagee, that (i) all materials installed and work and labor
performed (except to the extent they are to be paid for out of
the requested payment) in connection with the Restoration have
been paid for in full, (ii) there exist no notices of mechanics'
or other liens or encumbrances on the Mortgaged Property arising
out of the Restoration, and (iii) the balance of the Net Proceeds
plus the balance of any deficiency deposits given by Company to
Mortgagee pursuant to the provisions of this paragraph
hereinafter set forth shall be sufficient to pay in full the
balance of the cost of Restoration. The Restoration shall be
done and completed in compliance with all applicable laws, rules
and regulations, and all plans and specifications required in
connection with the Restoration shall be subject to review and
approval in all respects by Mortgagee. All costs and expenses
incurred by Mortgagee in connection with making the Net Proceeds
available for Restoration of the Mortgaged Property, including,
without limitation, reasonable counsel fees and inspecting
engineers' fees incurred by Mortgagee, shall be paid by Company.
The excess, if any, of the Net Proceeds after payment to Company
as hereinabove provided, shall be applied by Mortgagee in
reduction of the Debt in such priority and proportions as
Mortgagee in its discretion shall deem proper. If the Net
Proceeds shall be less than Fifty Thousand ($50,000.00) Dollars,
only one disbursement shall be required upon the completion of
the Restoration to the satisfaction of Mortgagee. If at any time
the Net Proceeds, or the undisbursed balance thereof, shall not
in the opinion of Mortgagee be sufficient to pay in full the
balance of the cost of Restoration, Company shall deposit the
deficiency with Mortgagee before any further disbursement of the
Net Proceeds shall be made. All insurance proceeds received by
Mortgagee and not required to be disbursed for Restoration
pursuant to the provisions of this paragraph hereinabove set
forth may be retained and applied by Mortgagee toward the payment
of the Debt whether or not then due and payable in such priority
and proportions as Mortgagee in its discretion shall deem proper
or, at the discretion of Mortgagee, the same may be paid, either
in whole or in part, to Company for such purposes as Mortgagee
shall designate. If Mortgagee shall receive and retain such
insurance proceeds, the lien of the Mortgage shall be reduced
only by the amount thereof received and retained by the Mortgagee
and actually applied by Mortgagee in reduction of the Debt. The
provisions of subsection 4 of Section 254 of the Real Property
Law of New York covering the insurance of buildings against loss
by fire shall not apply to this Agreement.
4. (a) Payment of Taxes, etc. Company shall pay all taxes,
assessments, water rates, sewer rents and other charges,
including vault charges and license fees for the use of vaults,
chutes and similar areas adjoining the Premises, and contractual
payments in lieu of any of the foregoing charges, now or
hereafter levied, existing or assessed against the Mortgaged
Property (the "Taxes") prior to the date upon which any fine,
penalty, interest or cost may be added thereto or imposed by law
for the nonpayment thereof. Company shall deliver to Mortgagee,
upon request, receipted bills, canceled checks and other evidence
satisfactory to Mortgagee evidencing the payment of the Taxes
prior to the date upon which any fine, penalty, interest or cost
may be added thereto or imposed by law for the nonpayment
thereof.
(b) Escrow Fund. Company shall, in the Event of Default,
at the option of Mortgagee, pay to Mortgagee on the first day of
each calendar month (i) one-twelfth of an amount which would be
sufficient to pay the Taxes payable, or estimated by Mortgagee to
be payable, during the next ensuing twelve (12) months and (ii)
one-twelfth of an amount which would be sufficient to pay the
premiums due for the renewal of the coverage afforded by the
Policies upon the expiration thereof (said amounts in (i) and
(ii) above hereinafter called the "Escrow Fund"). The Escrow
Fund and the payments of interest or principal or both, payable
pursuant to the Note shall be added together and shall be paid as
an aggregate sum by Company to Mortgagee. Company hereby pledges
to Mortgagee any and all monies now or hereafter deposited in the
Escrow Fund as additional security for the payment of the Debt.
Mortgagee will apply the Escrow Fund to payments required to be
made by Company pursuant to paragraphs 3 and 4 of this Mortgage.
If the amount of the Escrow Fund shall exceed the amounts due
pursuant to paragraphs 3 and 4 hereof, Mortgagee shall, in its
discretion, (1) return any excess to Company, (2) credit such
excess against the Debt in such priority and proportions as
Mortgagee in its discretion shall deem proper, or (3) credit such
excess against future payments to be made to the Escrow Fund. In
allocating such excess, Mortgagee may deal with the person shown
on the records of Mortgagee to be the owner of the Mortgaged
Property. If the Escrow Fund is not sufficient to pay the items
set forth in paragraphs 3 and 4 above, Company shall promptly pay
to Mortgagee, upon demand, an amount which Mortgagee shall
estimate as sufficient to make up the deficiency. Upon the
occurrence of an Event of Default (hereinafter defined) Mortgagee
may apply any sums in its hands to the payment of the following
items in any order in its uncontrolled discretion:
I. Taxes;
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 charges payable pursuant to the Note and the
Mortgage, including without limitation advances made by
Mortgagee pursuant to the terms of this Mortgage.
Until expended or applied as above provided, any amounts in the
Escrow Fund shall constitute additional security for the Debt.
The Escrow Fund shall not constitute a trust fund and may be
commingled with other monies held by Mortgagee. No earnings or
interest on the Escrow Fund shall be payable to Company.
(c) Escrow Fund Late Charge. In the event that any such
payments due to the Escrow Fund shall become overdue for a period
in excess of fifteen days, a "late charge" not to exceed an
amount equal to six percent (6%) of any such payment or payments
so overdue may be charged by the holder hereof for the purpose of
defraying the expense incident to handling such delinquent escrow
payment or payments.
5. Condemnation. Notwithstanding any taking by any public or
quasi-public authority through eminent domain or otherwise,
Company shall continue to pay the Debt at the time and in the
manner provided for its payment in the Note and in this Mortgage
and the Debt shall not be reduced until any award or payment
therefor shall have been actually received and applied by
Mortgagee to the discharge of the Debt. Mortgagee may apply any
such award or payment to the discharge of the Debt whether or not
then due and payable in such priority and proportions as
Mortgagee in its discretion shall deem proper. In the event the
Company is not in default under this mortgage and elects to
restore the Improvements pursuant to any applicable provision of
either Ground Lease, then the net amount of such proceeds shall
be disbursed to pay for the costs of such restoration. If the
Mortgaged Property is sold, through foreclosure or otherwise,
prior to the receipt by Mortgagee of such award or payment,
Mortgagee shall have the right, whether or not a deficiency
judgment on the Note shall have been sought, recovered or denied,
to receive such award or payment, or a portion thereof sufficient
to pay the Debt, whichever is less. Company shall file and
prosecute its claim or claims for any such award or payment in
good faith and with due diligence and cause the same to be
collected and paid over to Mortgagee subject to the rights of any
prior mortgagee, and hereby irrevocably authorize and empower
Mortgagee, in the name of Company or otherwise to collect and
receipt for any such award or payment and to file and prosecute
such claim or claims, and although it is hereby expressly agreed
that the same shall not be necessary in any event, Company shall,
upon demand of Mortgagee, make, execute and deliver any and all
assignments and other instruments sufficient for the purpose of
assigning any such award or payment to Mortgagee, free and clear
of any encumbrances of any kind or nature whatsoever.
6. Leases and Rents. To the extent not inconsistent with any
Collateral Assignment of Leases and Rents executed simultaneously
herewith, Company hereby assigns to Mortgagee the rents under
each tenancy or subtenancy of the Premises. Mortgagee has the
right to enter the Mortgaged Property for the purpose of
enforcing its interest in the Leases and the Rents. Subject to
the terms of this paragraph, Mortgagee waives the right to enter
the Mortgaged Property for the purpose of collecting the Rents,
and grants Company the right to collect the Rents. Company shall
hold the Rents, or an amount sufficient to discharge all current
sums due on the debt, in trust for use in payment of the Debt.
The right of Company to collect the Rents may be revoked by
Mortgagee upon the occurrence of an Event of Default by Company
under the terms of the Note or this Mortgage by giving notice of
such revocation to Company. Following such notice Mortgagee may
retain and apply the Rents toward payment of the Debt in such
priority and proportions as Mortgagee, in its discretion, shall
deem proper, or to the operation, maintenance and repair of the
Mortgaged Property. Company shall not, without the consent of
Mortgagee, make, or suffer to be made, any Leases for a term in
excess of five (5) years or cancel or modify any Leases or accept
prepayment of installments of the Rents for a period of more than
one (1) month in advance or further assign the whole or any part
of the Rents. Mortgagee shall have all of the rights against
tenants of the Mortgaged Property as set forth in Section 291-f
of the Real Property Law of New York. Company shall (a) fulfill
or perform each and every provision of the Leases on the part of
Company to be fulfilled or performed, and (b) enforce the
performance or observance of the provisions thereof by the
tenants thereunder. In addition to the rights which Mortgagee
may have herein, in the Event of Default under this Mortgage,
Mortgagee, at its option, may require Company to pay monthly in
advance to Mortgagee, or any receiver appointed to collect the
Rents, the fair and reasonable rental value for the use and
occupation of such part of the Mortgaged Property as may be in
possession of Company. Upon default in any such payment, Company
will vacate and surrender possession of the Mortgaged Property to
Mortgagee, or to such receiver and, in default thereof, Company
may be evicted by summary proceedings or otherwise. Nothing
contained in this paragraph shall be construed as imposing on
Mortgagee any of the obligations of the lessor or sublessor under
the Leases.
7. Maintenance of the Mortgaged Property. Company shall cause
the Mortgaged Property to be maintained in good condition and
repair and will not commit or suffer to be committed any waste of
the Mortgaged Property. The Improvements shall not be removed,
demolished or materially altered, without the consent of
Mortgagee, which consent shall not unreasonably be withheld or
delayed. Company shall promptly comply with all laws, orders and
ordinances affecting the Mortgaged Property, or the use thereof,
and shall promptly repair, replace or rebuild any part of the
Mortgaged Property which may be damaged or destroyed by any
casualty (including any casualty for which insurance was not
obtained or obtainable) or which may be affected by any
proceeding of the character referred to in paragraph 5 hereof and
shall complete and pay for, within a reasonable time, any
structure at any time in process of construction or repair on the
Premises. If such casualty shall be covered by the Policies,
Company's obligation to repair, replace or rebuild such portion
of the Mortgaged Property shall be contingent upon Mortgagee
paying Company the proceeds of the Policies or such portion
thereof as shall be sufficient to complete such repair,
replacement or rebuilding, whichever is less. Company will not,
without obtaining the prior consent of the Mortgagee, initiate,
join in or consent to any private restrictive covenant, zoning
ordinance, or other public or private restrictions, limiting or
defining the uses which may be made of the Mortgaged Property or
any part thereof.
8. Estoppel Certificates. Company, within ten (10) days after
request by Mortgagee and at its expense, will furnish Mortgagee
with a statement, duly acknowledged and certified, setting forth
the amount of the Debt and the offsets or defenses thereto, if
any.
9. Transfer or Encumbrance of the Mortgaged Property. Company
acknowledges that Mortgagee has examined and relied on the
creditworthiness of Company and experience of Company in owning
and operating properties such as the Mortgaged Property in
agreeing to make the loan secured hereby, and that Mortgagee will
continue to rely on Company's ownership interest of the Mortgaged
Property as a means of maintaining the value of the Mortgaged
Property as security for repayment of the Debt. Company
acknowledges that Mortgagee has a valid interest in maintaining
the value of the Mortgaged Property so as to ensure that, should
Company default in the repayment of the Debt, Mortgagee can
recover the Debt by a sale of the Mortgaged Property. Company
agrees, without the prior written consent of Mortgagee, which
shall not unreasonably be withheld or delayed, not to further
encumber (including any mortgage, deed of trust or wrap-around
mortgage or like security interest) the Mortgaged Property or any
part thereof or permit the further encumbrance of the Mortgaged
Property or any part thereof, or to sell, transfer or convey the
Mortgaged Property or any part thereof or the right to manage or
control the operation of the Mortgaged Property or any part
thereof or permit the Mortgaged Property or any part thereof to
be sold, transferred or conveyed, or pledge the Mortgaged
Property or any part thereof. A sale, transfer or conveyance
within the meaning of this paragraph 9 shall be deemed to include
(a) an installment sales agreement wherein Company agrees to sell
the Mortgaged Property or any part thereof for a price to be paid
in installments; (b) an agreement by Company leasing all or a
substantial part of the Mortgaged Property (except such leases as
are approved by Mortgagee) or a sale, assignment or other
transfer of, or the grant of a security interest in, Company's
right, title and interest in and to any Leases or any Rents; and
(c) if Company is a corporation, the voluntary or involuntary
sale, conveyance or transfer of Company's stock or the creation
or issuance of new stock by which an aggregate of more than 10%
of Company's stock shall be vested in a party or parties who are
not now stockholders. Mortgagee reserves the right to condition
the consent required hereunder upon a modification of the terms
hereof and on assumption of the Mortgage as so modified by the
proposed transferee, payment of a transfer fee, or such other
conditions as Mortgagee shall determine in its sole discretion to
be in the interest of Mortgagee. Mortgagee shall not be required
to demonstrate any actual impairment of its security or any
increased risk of default hereunder in order to declare the Debt
immediately due and payable upon the sale, transfer, conveyance
or further encumbrance of the Mortgaged Property without
Mortgagee's consent. This provision shall apply to every sale,
transfer, conveyance, or further encumbrance of the Mortgaged
Property or any part thereof regardless of whether voluntary or
not, or whether or not Mortgagee has consented to any previous
sale, transfer, conveyance, or further encumbrance of the
Mortgaged Property. Company shall give immediate written notice
to the Mortgagee of any such sale, transfer, conveyance or
further encumbrance.
10. Notice. Any notice, request, demand, statement or consent
made hereunder shall be in writing and shall be sent by mail to
the partys address, as listed in the Mortgage. Each party may
designate a change of address by notice to the other party, given
at least fifteen (15) days before such change of address is to
become effective.
11. Sale of Mortgaged Property. If this Mortgage is foreclosed,
the Mortgaged Property, may, at the discretion of Mortgagee, be
sold separately and in any order or manner, provided that if such
parcel shall be subdivided and offered for sale in separate
parcels, then the Ground Lessors written consent or an Order of a
court of competent jurisdiction shall be required.
12. Changes in the Laws Regarding Taxation. If any law is
enacted or adopted after the date of this Mortgage which deducts
the Debt from the value of the Mortgaged Property for the purpose
of taxation or which changes the laws now in force for the
taxation of mortgages, security instruments or debts secured
thereby or the manner of the operation of any such taxes or which
otherwise imposes a tax, either directly or indirectly, on the
Note, the Debt or the Mortgage, Company will pay such tax, with
interest and penalties thereon, if any. In the event Mortgagee
is advised by counsel chosen by it that the payment of such tax
or interest and penalties by Company would be unlawful, or
taxable to Mortgagee or unenforceable or provide the basis for a
defense of usury, then in any such event, Mortgagee shall have
the option, by written notice of not less than ninety (90) days,
to declare the Debt immediately due and payable.
13. Credits on Account of the Debt. Company will not claim or
demand or be entitled to any credit or credits on account of the
Debt for any part of the Taxes assessed against the Mortgaged
property or claimed from the taxable value of the Mortgaged
Property, or any part thereof, by reason of this Mortgage or the
Debt.
14. Offsets, Counterclaims and Defenses. Any assignee of this
Mortgage and the Note shall take the same free and clear of all
offsets, counterclaims or defenses of any nature whatsoever which
Company may have against any assignor of this Mortgage and the
Note and no such offset, counterclaim or defense shall be
interposed or asserted by Company in any action or proceeding
brought by any such assignee upon this Mortgage and/or the Note
and any such right to interpose or assert any such offset,
counterclaim or defense in any such action or proceeding is
hereby expressly waived by Company.
15. Other Security for the Debt. Company shall observe and
perform all of the terms, covenants and provisions contained in
the Note and in all other mortgages and other instruments or
documents evidencing, securing or guaranteeing payment of the
Debt, in whole or in part, or otherwise executed and delivered in
connection with the Note, this Mortgage or the loan evidenced and
secured thereby.
16. Documentary Stamps. If at any time the United States of
America, any state thereof or any governmental subdivision of any
such state, shall require revenue or other stamps to be affixed
to the Note or this Mortgage, Company will pay for the same, with
interest and penalties thereon, if any.
17. Right of Entry. Mortgagee and its agents shall have the
right to enter and inspect the Mortgaged Property at all
reasonable times and upon reasonable notice, so as to not
unreasonably interfere with the conduct of any tenant's business
activities upon the Mortgaged Property.
18. Books and Records. Company will keep and maintain or will
cause to be kept and maintained on a fiscal year basis in
accordance with generally accepted accounting practices
consistently applied and generally accepted for cash basis
taxpayers proper and accurate books, records and accounts
reflecting all of the financial affairs of Company and all items
of income and expense in connection with the operation of the
Mortgaged Property or in connection with any services, equipment
or furnishings provided in connection with the operation of the
Mortgaged Property, whether such income or expense be realized by
Company or by any other person whatsoever excepting lessees
unrelated to and unaffiliated with Company who have leased from
Company portions of the Mortgaged Property for the purpose of
occupying the same. On reasonable notice, Mortgagee shall have
the right from time to time at all times during normal business
hours to examine such books, records and accounts at the office
of Company or other person maintaining such books, records and
accounts and to make copies or extracts thereof as Mortgagee
shall desire. Upon request, Company will furnish Mortgagee
annually, within one hundred twenty (120) days next following the
end of each fiscal year of Company, with a complete copy of its
financial statement the accuracy of which is certified by Company
covering the Company and the operation of the Mortgaged Property
for such fiscal year and containing a fully itemized statement of
profit and loss and of surplus and a balance sheet. Upon
request, within one hundred twenty (120) days after the end of
each fiscal year of Company, Company shall furnish to Mortgagee a
certificate signed by Company certifying on the date thereof
either that there does or does not exist an event which
constitutes, or which upon notice or lapse of time or both would
constitute, a default under the Note or this Mortgage and if such
event exists, the nature thereof and the period of time it has
existed. Company shall furnish to Mortgagee, within ten (10)
days after request, such further detailed information covering
the operation of the Mortgaged Property and the financial affairs
of Company, as may be reasonably requested by Mortgagee.
19. Performance of Other Agreements. Company shall observe and
perform each and every term to be observed or performed by
Company pursuant to the terms of any agreement or recorded
instrument affecting or pertaining to the Mortgaged Property.
20. Events of Default. The Debt shall become immediately due at
the option of Mortgagee upon any one or more of the following
events ("Event of Default"):
(a) if any portion of the Debt is not paid within ten (10)
days after the same is due;
(b) if any of the Taxes is not paid within thirty (30) days
after notice and demand therefore, unless such Taxes are
being contested in good faith by Company in appropriate
proceedings;
(c) if the Policies are not kept in full force and effect,
or if the Policies are not assigned and delivered to
Mortgagee within fifteen (15) days after receipt of
Mortgagee's written request;
(d) if Company violates or does not comply in all material
respects with any of the material provisions of paragraph 6,
7, or 9 of this Mortgage;
(e) if any representation or warranty of Company or
performance by Company of any of the terms of the Mortgage,
made herein or in any report, financial statement or other
instrument furnished to Mortgagee shall prove false or
misleading in any material respect;
(f) if Company shall make an assignment for the benefit of
creditors;
(g) if a receiver, liquidator or trustee of Company shall
be appointed or if Company shall be adjudicated a bankrupt
or insolvent, or if any petition for bankruptcy,
reorganization or arrangement pursuant to federal bankruptcy
law, or any similar federal or state law, shall be filed by
or against Company or if any proceeding for the dissolution
or liquidation of Company shall be instituted and, if such
appointment, adjudication, petition or proceeding was
involuntary and not consented to by Company or such
Guarantor, upon the same not being discharged, stayed or
dismissed within sixty (60) days or if Company shall
generally not be paying its debts as they become due;
(h) if Company shall continue to be in default under any of
the other terms, covenants or conditions of this Mortgage
for ten (10) days after notice from Mortgagee in the case of
any default which can be cured by the payment of a sum of
money or for thirty (30) days after notice from Mortgagee in
the case of any other default, provided that if such default
cannot reasonably be cured within such thirty (30) day
period and thereafter Company diligently and expeditiously
proceeds to cure the same, such thirty (30) day period shall
be extended for so long as it shall require Company in the
exercise of due diligence to cure such default, it being
agreed that no such extension shall be for a period in
excess of ninety (90) days;
(i) if Company shall be in default, beyond applicable grace
periods, if any, under any other mortgage or security
agreement covering any part of the Mortgaged Property
whether it be superior or junior in lien to this Mortgage;
(j) if the Mortgaged Property shall become subject (i) to
any lien which is superior to the lien of the Mortgage,
other than a lien for local real estate taxes and
assessments not due and payable, or (ii) to any mechanic's,
materialman's or other lien which is or is asserted to be
superior to the lien of the Mortgage and such lien shall
remain undischarged for thirty (30) days;
(k) if Company fails to cure promptly any violation of laws
or ordinances, the violation of which is reasonably likely
to materially and adversely affect the Mortgaged Property;
(l) if an Event of Default occurs under the Ground Lease
in effect on the Premises; or
(m) if the Ground Lessor shall deliver to Company notice of
default under the terms of the Ground Lease and Company
shall not have commenced and thereafter proceeded with
diligence and in good faith to cure such default in
accordance with the terms of such Ground Lease.
21. Right to Cure Defaults. If an Event of Default herein
occurs, or in the event the Company shall default in the
performance of any of the covenants of any Senior Mortgage, the
Mortgagee may, at its discretion, remedy the same and for such
purpose shall have the right to enter upon the Mortgaged Property
or any portion thereof without thereby becoming liable to Company
or any person in possession thereof holding under Company,
provided that such entry shall not unreasonably interfere with
the conduct of any tenant's business activities upon the
Mortgaged Property. If Mortgagee shall remedy such a default or
appear in, defend, or bring any action or proceeding to protect
its interest in the Mortgaged Property or to foreclose this
Mortgage or collect the Debt, the costs and expenses thereof
(including reasonable attorneys' fees to the extent permitted by
law), with interest as provided in this paragraph, shall be paid
by Company to Mortgagee upon demand. All such costs and expenses
incurred by Mortgagee in remedying such default or in appearing
in, defending, or bringing any such action or proceeding shall be
paid by Company to Mortgagee upon demand, with interest at the
rate set forth in the Note for the period after notice from
Mortgagee that such costs or expenses were incurred to the date
of payment to Mortgagee. All such costs and expenses incurred by
Mortgagee pursuant to the terms of this Mortgage, with interest,
shall be secured by this Mortgage.
22. Late Payment Charge. If any portion of the Debt is not paid
within ten (10) days after the date on which it is due, Company
shall pay to Mortgagee upon demand a late payment charge of six
cents ($.06) for each dollar ($1) of such unpaid portion of the
Debt to defray the expense incurred by Mortgagee in handling and
processing such delinquent payment, and such amount shall be
secured by this Mortgage.
23. Appointment of Receiver. Mortgagee, in any action to
foreclose this Mortgage or upon the actual or threatened waste to
any part of the Mortgaged Property or upon the occurrence of any
default hereunder, shall be at liberty, without notice, to apply
for the appointment of a receiver of the Rents, and shall be
entitled to the appointment of such receiver as a matter of
right, without regard to the value of the Mortgaged Property as
security for the Debt, or the solvency or insolvency of any
person then liable for the payment of the Debt.
24. Non-Waiver. The failure of Mortgagee to insist upon strict
performance of any term of this Mortgage shall not be deemed to
be a waiver of any term of this Mortgage. Company shall not be
relieved of Company's obligation to pay the Debt at the time and
in the manner provided for its payment in the Note and this
Mortgage by reason of (i) failure of Mortgagee to comply with any
request of Company to take any action to foreclose this Mortgage
or otherwise enforce any of the provisions hereof or of the Note
or any other mortgage, instrument or document evidencing,
securing or guaranteeing payment of the Debt or any portion
thereof, (ii) the release, regardless of consideration, of the
whole or any part of the Mortgaged Property or any other security
for the Debt or (iii) any agreement or stipulation between
Mortgagee and any subsequent owner or owners of the Mortgaged
Property or other person extending the time of payment or
otherwise modifying or supplementing the terms of the Note, this
Mortgage or any other mortgage, instrument or document
evidencing, securing or guaranteeing payment of the Debt or any
portion thereof, without first having obtained the consent of
Company, and in the latter event, Company shall continue to be
obligated to pay the Debt at the time and in the manner provided
in the Note and this Mortgage, as so extended, modified and
supplemented, unless expressly released and discharged by
Mortgagee. Regardless of consideration, and without the
necessity for any notice to or consent by the holder of any
subordinate lien, encumbrance, right, title or interest in or to
the Mortgaged Property, Mortgagee may release any person at any
time liable for the payment of the Debt or any portion thereof or
any part of the security held for the Debt and may extend the
time of payment or otherwise modify the terms of the Note and/or
this Mortgage, including, without limitation, a modification of
the interest rate payable on the principal balance of the Note,
without in any manner impairing or affecting this Mortgage or the
lien thereof or the priority of this Mortgage, as so extended and
modified, as security for the Debt over any such subordinate
lien, encumbrance, right, title or interest. Mortgagee may
resort for the payment of the Debt to any other security held by
Mortgagee in such order and manner as Mortgagee, in its dis
cretion, may elect. Mortgagee may take action to recover the
Debt, or any portion thereof, or to enforce any covenant hereof
without prejudice to the right of Mortgagee thereafter to
foreclose this Mortgage. Mortgagee shall not be limited
exclusively to the rights and remedies herein stated but shall be
entitled to every additional right and remedy now or hereafter
afforded by law. The rights of Mortgagee under this Mortgage
shall be separate, distinct and cumulative and none shall be
given effect to the exclusion of the others. No act of Mortgagee
shall be construed as an election to proceed under any one
provision herein to the exclusion of any other provision.
25. Liability. All obligations or liabilities, if there is more
than one mortgagor, shall be joint and several.
26. Construction. The terms of this Mortgage shall be construed
in accordance with the laws of the State of New York.
27. Further Acts, etc. Company will, at the cost of Company,
and without expense to Mortgagee, do, execute, acknowledge and
deliver all and every such further acts, deeds, conveyances,
mortgages, assignments, notices of assignments, transfers and
assurances as Mortgagee shall, from time to time, require, for
the better assuring, conveying, assigning, transferring and
confirming unto Mortgagee the property and rights hereby
mortgaged or intended now or hereafter so to be, or which Company
may be or may hereafter become bound to convey or assign to
Mortgagee, or for carrying out the intention or facilitating the
performance of the terms of this Mortgage or for filing,
registering or recording this Mortgage and, on demand, will
execute and deliver and hereby authorizes Mortgagee to execute in
the name of Company to the extent Mortgagee may lawfully do so,
one or more financing statements, chattel mortgages or comparable
security instruments, to evidence more effectively the lien
hereof upon the Mortgaged Property.
28. Headings, etc. The headings and captions of various
paragraphs of this Mortgage 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.
29. Filing of Mortgage, etc. Company forthwith upon the
execution and delivery of this Mortgage and thereafter, from time
to time, will cause this Mortgage, and any security instrument
creating a lien or evidencing the lien hereof upon the Mortgaged
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 the lien hereof upon, and the
interest of Mortgagee in, the Mortgaged Property. Company will
pay all filing, registration or recording fees, and all expenses
incident to the preparation, execution and acknowledgment of this
Mortgage, any mortgage supplemental hereto, any security
instrument with respect to the Mortgaged property and any
instrument of further assurance, and all Federal, state, and
county and municipal taxes, duties, impost, assessments and
charges arising out of or in connection with the execution and
delivery of this Mortgage, any mortgage supplemental hereof, any
security instrument with respect to the Mortgaged Property or any
instrument of further assurance. Company shall hold harmless and
indemnify Mortgagee, its successors and assigns, against any
liability incurred by reason of the imposition of any tax on the
making and recording of this Mortgage.
30. Usury Laws. This Mortgage and the Note are subject to the
express condition that at no time shall Company be obligated or
required to pay interest on the principal balance due under the
Note at a rate which could subject the holder of the Note to
either civil or criminal liability as a result of being in excess
of the maximum interest rate which Company is permitted by law to
contract or agree to pay. If by the terms of this Mortgage or
the Note, Company is at any time required or obligated to pay
interest on the principal balance due under the Note at a rate in
excess of such maximum rate, the rate of interest under the Note
shall be deemed to be immediately reduced to such maximum rate
and the interest payable shall be computed at such maximum rate
and all prior interest payments in excess of such maximum rate
shall be applied and shall be deemed to have been payments in
reduction of the principal balance of the Note.
31. Sole Discretion of Mortgagee. Wherever pursuant to this
Mortgage, Mortgagee exercises any right given to it to approve or
disapprove, or any arrangement or term is to be satisfactory to
Mortgagee, the decision of Mortgagee to approve or disapprove or
to decide that arrangements or terms are satisfactory or not
satisfactory shall be in the sole discretion of Mortgagee and
shall be final and conclusive.
32. Recovery of Sums Required To Be Paid. Mortgagee 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 Mortgagee thereafter
to bring an action of foreclosure, or any other action, for a
default or defaults by Company existing at the time such earlier
action was commenced.
33. Marshalling and Other Matters. Company hereby waives, to
the extent permitted by law, 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 Mortgaged Property or any part
thereof or any interest therein. Further, Company hereby
expressly waives any and all rights of redemption from sale under
any order or decree of foreclosure of the Mortgage on behalf of
Company, and on behalf of each and every person acquiring any
interest in or title to the Mortgaged Property subsequent to the
date of the Mortgage and on behalf of all persons to the extent
permitted by applicable law.
34. Authority. Company (and the undersigned representative of
Company, if any) has full power, authority and legal right to
execute this Mortgage and to mortgage, give, grant, bargain,
sell, alien, convey, confirm and assign the Mortgaged Property
pursuant to the terms hereof and to keep and observe all of the
terms of this Mortgage on Company's part to be performed. If
Company is a corporation, neither its certificate of
incorporation nor any amendment thereto nor its by-laws requires
the consent of shareholders to the execution and delivery of this
Mortgage and the execution and delivery of this Mortgage have
been duly authorized by its Board of Directors.
35. Actions and Proceedings. Mortgagee shall have the right to
appear in and defend any action or proceeding brought with
respect to the Mortgaged Property and to bring any action or
proceeding, Mortgagee in its discretion, determines should be
brought to protect its interest in the Mortgaged Property.
36. Inapplicable Provisions. If any term, covenant or condition
of this Mortgage shall be held to be invalid, illegal or
unenforceable in any respect, this Mortgage shall be construed
without such provision.
37. Certain Definitions. Unless the context clearly indicates a
contrary intent or unless otherwise specifically provided herein,
words used in this Mortgage shall be used interchangeably in
singular or plural form and the word "Company" shall mean each
and/or any subsequent owner or owners of the Mortgaged Property
or any part thereof or interest therein, the word "Mortgagee"
shall mean Mortgagee or any subsequent holder of the Note, the
word "Note" shall mean the Note or any other evidence of
indebtedness secured by this Mortgage, the word "person" shall
include an individual, corporation, partnership, trust, limited
liability company, unincorporated association, government,
governmental authority, or other entity, the words "Mortgaged
Property" shall include any portion of the Mortgaged Property or
interest therein, and the word "Debt" shall mean all sums secured
by this Mortgage. Whenever the context may require, any pronouns
used herein shall include the corresponding masculine, feminine
or neuter forms, and the singular form of nouns and pronouns
shall include the corresponding masculine, feminine or neuter
forms, and the singular form of nouns and pronouns shall include
the plural and vice versa.
38. Waiver of Notice. Company shall not be entitled to any
notices of any nature whatsoever from Mortgagee except with
respect to matters for which this Mortgage specifically and
expressly provides for the giving of notice by Mortgagee to
Company, and Company hereby expressly waives the right to receive
any notice from Mortgagee with respect to any matter for which
this Mortgage does not specifically and expressly provide for the
giving of notice by Mortgagee to Company.
39. No Oral Change. This document may not be modified, amended,
changed, discharged or terminated orally, but only by an
agreement in writing signed by the party against whom the
enforcement of the modification, amendment, change, discharge or
termination is sought.
40. Trust Fund. Pursuant to Section 13 of the Lien Law of New
York, Company shall receive the advances secured hereby and shall
hold the right to receive such advances as a trust fund to be
applied first for the purpose of paying the cost of any
improvement on the Mortgaged Property and shall apply such
advances first to the payment of the cost of any such improvement
on the Mortgaged Property before using any part of the total of
the same for any other purpose, but nothing contained herein
shall be construed as imposing upon Mortgagee any obligation to
ensure the proper allocation of such advances.
41. Attorneys' Fees. If an Event of Default occurs hereunder
the Company shall be responsible to pay court fees, filing fees,
costs and reasonable attorneys fees incurred by the Mortgagee to
remedy such default, to collect the Debt or to foreclose this
Mortgage. In addition, if any action or proceeding be commenced
to which the Mortgagee by virtue of being Mortgagee hereof,
becomes a party, or if a bankruptcy proceeding is filed by or
against Company, the Company will reimburse the Mortgagee for its
expenses in connection therewith, including reasonable attorneys'
fees.
42. Mortgage Tax. The Company shall pay any tax imposed under
Article 11 of the Tax Law or any law amendatory thereof in
relation to recording this Mortgage or the recording of any
supplementary mortgage or other documents relating thereto, or
relating in any manner to the Debt. If the Company defaults in
paying such tax, the Mortgagee may pay the same and the Company
shall reimburse the Mortgagee therefor together with interest at
the rate specified in the Note, and the sums so paid by the
Mortgagee and interest shall be added to and become part of the
indebtedness secured by this Mortgage and any such supplement
thereto.
43. Environmental Matters. Company represents and covenants
that, except to the extent permitted or contemplated by
applicable law (i) to the best of Company's knowledge, the
Mortgaged Property complies in all respects with all
environmental laws and regulations, (ii) any medical waste,
pollutants, contaminants, solid wastes, hazardous or toxic
substances, petroleum products and other waste (herein,
collectively, "contaminants") will at all times be handled,
stored, treated and disposed of by Company or any subtenant of
Company or occupant of the Mortgaged Property in strict
compliance with all applicable environmental or other laws,
ordinances, rules and regulations (herein, collectively,
"environmental laws" and, except as permitted herein, all of such
contaminants shall be removed from and off the Mortgaged
Property, (iii) no contaminants will be discharged, released,
stored, treated, generated, disposed of, or allowed to escape or
exist on the Mortgaged Property, except as permitted herein, (iv)
no asbestos has been or will be incorporated into or disposed of
on the Mortgaged Property, (v) no underground fuel or chemical
storage tanks are, will be, or have been located on the Mortgaged
Property, and (vi) to the best of Company's knowledge, no
investigation, order, agreement, notice, demand, or settlement
with respect to any of the above-mentioned is threatened,
anticipated, in existence, or will be in existence. Company upon
receiving any information or notice contrary to the
representations contained in this paragraph shall immediately
notify the Mortgagee in writing with full details regarding the
same. Company hereby releases Mortgagee from liability with
respect to, and agrees to defend, indemnify, and hold harmless
Mortgagee, its directors, officers, employees, agents, representa
tives, successors, and assigns from and against any and all
claims, demands, damages, costs, orders, liabilities, penalties,
and expenses (including attorneys' fees) relating in any way to
any violation of the covenants or failure to be accurate of the
representations contained in this paragraph. In the event
Mortgagee in its reasonable discretion deems it necessary to
perform due diligence with respect to any of the above, or to
have an environmental audit performed with respect to the
Mortgaged Premises, Company agrees to permit the same to be
conducted and agrees to pay the expenses of same to Mortgagee
upon demand, and agrees that upon failure to do so its obligation
for such expenses shall be secured by this Mortgage.
44. Ground Lease Rental. That the Company will pay or cause to
be paid, not later than the day when the same becomes due and
payable all rent, additional rent, and other payments required to
be paid by the Company under the Ground Lease in a timely and
effective manner.
45. No Impairment. In no event shall the Company do or permit
to be done, or omit to be done, an act which would impair the
security of Mortgage, or would constitute grounds for the
termination of the Ground Lease; or would entitle the Ground
Lessor thereunder to declare a forfeiture of said Ground Lease,
or to re-enter the Premises.
46. No Modification. Company will not release, surrender,
terminate, or modify the Ground Lease in any manner without the
prior written consent of the Mortgagee.
47. Separate Estates. Company shall not, without the prior
written consent of the Mortgagee, permit the fee title to the
Premises and the leasehold estate created thereby to merge, but
shall always keep such interests separate and distinct, and if
the Company acquires the fee title or any other interest in the
Premises, the Mortgage shall attach to, cover, spread to, and be
a lien upon such interest, and such interest shall be considered
as mortgaged to Mortgagee as fully and to the same effect as if
specifically herein mortgaged.
48. Notifications. Company agrees to: (a) promptly notify
Mortgagee in writing of any default by the Ground Lessor in the
performance of any of the terms, covenants, or conditions on the
part of the Ground Lease to be performed; (b) promptly (i) advise
the Mortgagee in writing of the delivery of any notice by the
Ground Lessor to the Company of any default by the Company, in
the performance of any terms, covenants, or conditions of either
Ground Lease on the part of the Company to be performed and (ii)
deliver to the Mortgagee a true copy of each such notice; (c)
promptly after the execution and delivery of this Mortgage or of
any instrument or agreement supplemental thereof, notify the
Ground Lessor in writing of the execution and delivery thereof
and deliver to the Ground Lessor a copy of each such instrument
or agreement; (d) promptly notify the Mortgagee in writing in the
event of the initiation of any arbitration proceeding or other
legal action pursuant to the provisions of either Ground Lease,
it being expressly agreed that if, at the time any such
arbitration proceeding be initiated, the Company shall be in
default in the performance of any term, covenant, condition, or
other requirement of this Mortgage, or of the Ground Lease, the
Mortgagee shall have, the sole and exclusive right to designate
and appoint the arbitrator to be appointed by the Company in such
arbitration proceeding; and in all events Mortgagee has the right
but not the obligation to participate in such proceedings; (e)
within ten (10) days after written demand by the Mortgagee to
furnish to Company a written estoppel certificate certified to be
true which certificate shall state: (i) whether or not there are
any defaults, anticipated defaults or offsets on the Ground Lease
and set forth such defaults, anticipated defaults or offsets,
(ii) the date to which such Ground Lease is in effect, (iii) the
fact that the Company or a third party intends to rely on such
statement in the granting of consideration; (f) not, without the
written consent of the Company, waive its right to renew the
Ground Lease for any renewal term provided in the Ground Lease;
(g) keep the Ground Lease in full force in effect while this
Mortgage is in effect and the Debt unpaid and without limiting
Companys obligations elsewhere in this Mortgage to execute and
put into effect such renewal terms as required to be put into
effect by Mortgagee.
49. Article 14 Foreclosure. In the event of default under
the Note or this Mortgage, Mortgagee shall have, without
limitation, all of the rights and remedies provided by Article 14
of the Real Property Actions and Proceedings Law of the State of
New York.
50. Consolidated Mortgage. This mortgage is consolidated
with a Mortgage given to Xxxxxxxx Trust Company in the principal
amount of $320,000.00 dated July 26, 2006 and recorded July 26,
2006 in said Clerk's Office as Instrument Number 494096-004
("Prior Mortgage"), which Prior Mortgage has a principal balance
of $318,814.29 as of the date hereof, so as to form a single,
consolidated mortgage lien securing the principal sum of
$1,050,000.00.
IN WITNESS WHEREOF, Company has duly executed this Mortgage
the day and year first above written.
EVAPORATED METAL FILMS CORP.
by: _______________________________
Xxxxx Xxxx, Authorized Officer
STATE OF NEW YORK )
COUNTY OF XXXXXXXX ) ss.:
On the 2nd day of October, 2006, before me, the undersigned,
a Notary Public in and for said State, personally appeared Xxxxx
Xxxx, personally known to me or proved to me on the basis of
satisfactory evidence to be the individual whose name is
subscribed to the within instrument and he 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 same.
_____________________________
Notary Public
SCHEDULE A
ALL THAT TRACT OR PARCEL OF LAND situate in the City of
Ithaca, County of Xxxxxxxx, and State of New York, bounded and
described as follows:
COMMENCING at a pin found in the southeasterly line of
Cherry Street a distance of 631 feet, more or less, southwesterly
from its intersection with the south line of West Clinton Street;
running thence south 47 degrees 9 minutes 14 seconds east along
premises reputedly of Ithaca Urban Renewal Agency (625/5) to a
point in the northwesterly line of premises reputedly of Norfolk
Southern Railroad; running thence along said Norfolk Southern
Railroad premises south 44 degrees 29 minutes 47 seconds west a
distance of 267.02 feet to a point; running thence along premises
reputedly of Ithaca Urban Renewal Agency (644/737) north 47
degrees 09 minutes 14 seconds west a distance of 237.63 feet to a
bent pin found in the southeasterly line of Cherry Street;
running thence along said line of Cherry Street north 42 degrees
53 minutes 17 seconds east a distance of 266.91 feet to the point
and place of beginning.
SUBJECT to an easement granted by Ithaca Urban Renewal
Agency to New York State Electric and Gas Corp. by instrument
dated November 28, 1988 and recorded on January 5, 1989 in the
Xxxxxxxx County Clerks Office in Liber 643 of Deeds at page 15.
This mortgage is SUBJECT AND SUBORDINATE to two (2)
Leasehold Mortgages given to Xxxxxxxx County Trust Company, as
follows: (1) in the original principal amount of $100,000, dated
December 22, 2004, and (2) in the original principal amount of
$115,000, dated December 22, 2005.
XXXXXXXX TRUST COMPANY MORTGAGE NOTE
$1,050,000.00 Ithaca, New York
Maturity Date: October 1, 2026
October 2, 2006
FOR VALUE RECEIVED, EVAPORATED METAL FILMS CORP., a New York
corporation, maintaining its office at 000 Xxxxxx Xxxxxx, Xxxxxx,
Xxx Xxxx 00000 (herein "Maker" or "Borrower") promises to pay to
the order of XXXXXXXX TRUST COMPANY, a New York banking
corporation having an office at The Commons, Ithaca, New York
14850 ("Payee" or "Bank"), or at such other place as may be
designated, from time to time, by Payee, the principal sum of ONE
MILLION FIFTY THOUSAND DOLLARS AND NO CENTS ($1,050,000.00) in
lawful money of the United States of America, with interest
thereon (the "Loan") from the date of this Note until paid.
Unless otherwise defined herein, all terms shall have the
meanings set forth in the Mortgage or Mortgages securing this
Note.
INTEREST RATE
Borrower will pay interest at the initial rate of 7.80% per
year (the "Initial Rate") on the unpaid principal. Interest will
be charged beginning on the date of this Note and continuing
until the debt has been paid in full. The interest rate may
increase or decrease during the life of this Note, as provided
herein.
Commencing on the date of the Note and continuing until
October 1, 2011 the interest rate will be 7.80%. The interest
rate will adjust on October 1, 2011, and every five (5) years
thereafter on October 1st (each, an "Interest Rate Adjustment
Date") and will correspond directly to changes in the Index. The
Index is the Federal Home Loan Bank of New York Advance Rate for
5-year maturities, as made available by the Federal Home Loan
Bank of New York on the 15th day of the month immediately prior
to the Interest Rate Adjustment Date, or, if such day is not a
business day, then on the first business day thereafter. On each
Interest Rate Adjustment Date, the new interest rate will be
determined by adding 2.80 percentage points to the Index and
rounding up to the next higher one quarter of a percentage point.
In the event the Federal Home Loan Bank of New York Advance Rate
is no longer available, the Index will be determined from any
other comparable source deemed satisfactory to the Payee.
Interest shall be computed on the basis of actual days elapsed
divided by a 360 day year.
The interest rate as provided in this section shall apply at
all times except during those periods of time, if any, when the
Default Interest Rate shall be applicable.
PRINCIPAL AND INTEREST PAYMENTS
Commencing on November 1, 2006 and on the first day of each
month thereafter up to and including October 1, 2011, Xxxxxxxx
will make monthly payments of interest and principal in the
amount of EIGHT THOUSAND SEVEN HUNDRED TWENTY-SIX DOLLARS and 54
CENTS ($8,726.54).
Commencing on November 1, 2011 (the first day of the month
following the determination of the new interest rate) and every
five (5) years thereafter on November 1st, the monthly payments
will be adjusted in order that the unpaid principal and accrued
interest shall be paid in full on the Maturity Date in
substantially equal monthly payments. All unpaid principal and
interest, if any, shall be due and payable on the Maturity Date.
Notwithstanding the payment schedule provided herein or
established herein, all amounts of principal and interest due
under this Note shall be due and payable on October 1, 2026
(herein the "Maturity Date").
DEFAULT INTEREST RATE
The interest rate hereunder shall be increased to three (3)
percentage points higher than the interest rate then in effect
(as so increased, herein "Default Interest Rate") in the event
of: (1) the failure by Maker to make any installment payment due
under this Note on or before the 30th day following the due date
thereof, or (2) the failure by Maker to comply with any of the
other terms, covenants or conditions of this Note or any Mortgage
securing this Note, within 30 days following the earliest date of
such noncompliance. In the case of nonpayment, the Default
Interest Rate shall apply commencing on the 31st day following
the due date of such unpaid installment payment and continue
thereafter unless and until all regularly scheduled past due
monthly payments shall have been paid by Maker. In the case of
noncompliance with any of the other terms, covenants or
conditions of this Note or any Mortgage securing this Note, the
Default Interest Rate shall apply commencing on the 31st day
following the earliest date of such noncompliance and continue
thereafter unless and until such default has been fully cured.
Nothing contained herein shall be construed as limiting Payee's
rights of acceleration upon an Event of Default as provided
herein.
MORTGAGE
The term "Mortgage" as used in this Note shall mean the
mortgage of even date herewith in the principal sum of
$731,185.71, intended to be duly recorded in the Xxxxxxxx County
Clerk's Office, on premises situate at 000 Xxxxxx Xxxxxx, xx xxx
Xxxx xx Xxxxxx, Xxxxxxxx Xxxxxx, Xxx Xxxx, as more particularly
described therein, as consolidated with a Mortgage given to
Xxxxxxxx Trust Company in the principal amount of $320,000.00
dated July 26, 2006 and recorded July 26, 2006 in said Clerk's
Office as Instrument Number 494096-004 ("Prior Mortgage"), which
Prior Mortgage has a principal balance of $318,814.29, so as to
form a single, consolidated mortgage lien securing the principal
sum of $1,050,000.00. All property subject to the lien of this
mortgage shall be known herein as the "Premises" or "Mortgaged
Property." This Note is secured by the Mortgage.
LATE PAYMENT CHARGE
If any sum payable under this Note is not paid within ten
(10) days after the date on which it is due, Maker shall pay a
late charge of six percent (6%) of such unpaid sum.
PREPAYMENTS
A prepayment premium shall be paid by Maker in the event of
a Prepayment, as hereinafter defined, made on or before October
2, 2012. The amount of the prepayment premium shall be equal to
the amount of the Prepayment multiplied by the Prepayment
Percentage, as hereinafter defined. The Prepayment Percentage
shall vary based upon the date of the Prepayment in accordance
with the following schedule:
Date of Prepayment Prepayment Percentage
------------------ ---------------------
On or prior to October 2, 2007 5%
After October 2, 2007 and on
or prior to October 2, 2008 4%
After October 2, 2008 and on
or prior to October 2, 2009 3%
After October 2, 2009 and on
or prior to October 2, 2010 2%
After October 2, 2010 and on
or prior to October 2, 2012 1%
There shall be no prepayment premium after October 2, 2012. The
term Prepayment shall mean any non-scheduled payment of principal
which results from a refinancing of the Loan, or a portion
thereof, with any party other than Xxxxxxxx Trust Company. All
Prepayments shall be applied to the reduction and payment of
principal in inverse order of maturity. No Prepayment shall
extend the time for payment of any subsequent installment.
ACCELERATION
IT IS HEREBY EXPRESSLY AGREED that the entire unpaid
principal balance of this Note, together with all interest
accrued and unpaid thereon and all other sums due under this Note
and the Mortgage shall become immediately due and payable at the
option of the Payee on the happening of any Event of Default
hereunder or under the terms of the Mortgage, and that all of the
terms, covenants and provisions contained in the Mortgage which
are to be kept and performed by Maker are hereby made part of
this Note to the same extent and with the same force and effect
as if they were fully set forth herein.
WAIVER OF PRESENTMENT, ETC.
Maker hereby waives presentment and demand for payment,
notice of dishonor, protest and notice of protest of this Note.
No release of any security for the principal sum due under this
Note or extension of time for payment of this Note, or any
installment hereof, or acceptance of partial payments hereunder,
and no alteration, amendment or waiver of any provision of this
Note or the Mortgage made by agreement between Payee and any
other person or party shall release, discharge, modify, change or
affect the liability of the Maker under this Note and the
Mortgage.
USURY REQUIREMENTS COMPLIANCE
This Note is subject to the express condition that at no
time shall Maker be obligated or required to pay interest on the
principal balance of this Note at a rate which could subject
Payee to either civil or criminal liability as a result of being
in excess of the maximum rate that Maker is permitted by law to
contract for or agree to pay. If by the terms of this Note, the
Maker is at any time required or obligated to pay interest on the
principal balance of this Note at a rate in excess of such
maximum rate, the rate of interest under this Note shall be
deemed to be immediately reduced to such maximum rate and
interest payable hereunder shall be computed at such maximum rate
and the portion of all prior interest payments in excess of such
maximum rate shall be applied to principal and shall be deemed to
have been payments in reduction of the principal balance of this
Note.
BUSINESS DAYS
If any payment hereunder becomes due on a Saturday, Sunday,
or other holiday on which banks doing business in the State of
New York are authorized to close, the due date for this Note or
the payment may be extended to the next succeeding business day,
and interest and fees shall be calculated based upon the time of
actual payment.
AFFIRMATIVE AND NEGATIVE COVENANTS
For as long as any of the principal of this Note shall be
outstanding:
X. Xxxxxx and Financial Information. Borrower will
provide copies of any and all leases affecting the mortgaged
premises upon request by Bank. Within 120 days of each fiscal
year end, Borrowers must furnish annual financial statements and
tax returns in form and content satisfactory to the Bank.
Borrower shall provide interim financial statements every six
months.
Borrower shall furnish such additional information,
reports or statements relating to the operation and management of
the mortgaged Premises and Borrower as the Bank from time to time
may reasonably require.
B. Notification of Adverse Changes. The Maker shall
promptly notify the Payee of any material and adverse: (1) court
or administrative determination, or (2) business development
reasonably affecting the mortgaged Premises; provided, however,
that Maker shall not be obligated to provide the Payee with
material nonpublic information without reasonable assurance from
the Payee as to Payee's use, disclosure or disposition of that
information in compliance with applicable securities laws.
C. Compliance with Laws. The Maker shall maintain
compliance in all material respects with all applicable laws,
regulations, ordinances, rules and orders which affect the
mortgaged Premises.
D. Further Assurances. The Maker will cooperate with the
Payee and execute, acknowledge (if appropriate) and deliver such
further instruments and documents, and take such other action as
the Payee shall reasonably request to carry out to its
satisfaction the transactions contemplated by this Note.
EVENTS OF DEFAULT
The entire outstanding principal balance of, and all accrued
and unpaid interest on, this Note, together with any amount which
may become due because of prepayment, shall immediately become
due at the option of Payee upon the occurrence and during the
continuation of any one of the following events (each, an "Event
of Default"):
(a) Any principal or accrued interest due
under this Note is not paid within ten (10) days after
the same is due.
(b) The failure of Maker to pay within
thirty (30) days after the due date thereof, any
installment of any assessment against the Premises for
local real estate taxes, improvements heretofore or
hereafter laid or any payment in lieu of taxes, which
assessment or payment is or may become payable in
annual or periodic installments and is or may become a
lien on the Premises; provided, however, that Maker may
delay the making of any such payment for so long as it:
(i) is contesting in good faith in appropriate
proceedings the obligation to make such a payment and
(ii) has established sufficient reserves for the
payment of such amounts that may become due in the
event such contest is not successful, provided further
that such payment may not be delayed beyond the tome of
commencement of proceedings to enforce or foreclose
such lien.
(c) Any judgment, State tax lien or Federal
tax lien is filed against the Premises and the same is
not paid or discharged of record within sixty (60)
days; provided, however, that Maker may delay the
making of any such payment or discharge for so long as
it: (i) is contesting in good faith in appropriate
proceedings the obligation to make such a payment or
discharge, and (ii) has established sufficient reserves
for the payment of such amounts that may become due in
the event such contest is not successful, provided
further that such payment may not be delayed beyond the
tome of commencement of proceedings to enforce or
foreclose such lien..
(d) Except as permitted herein or in the
Mortgage, any part of the Mortgaged Property or any
interest therein is in any manner further mortgaged,
encumbered, sold, transferred, conveyed or subjected to
a lien (not removed within thirty (30) days), or any
portion of the Mortgaged Property is removed,
demolished or materially altered, or the Mortgaged
Property is not kept in good condition and repair.
(e) Any representation or warranty of Maker
made herein or in any certificate, report, financial
statement or other instrument furnished in connection
with the making of any instrument evidencing the Loan
shall prove to have been false or misleading in any
material respect when made.
(f) Maker shall fail to observe in any
material respect any of the other material terms,
covenants or conditions of this Note or the Mortgage.
(g) Maker shall undergo liquidation or
dissolution or take any action in preparation or
furtherance thereof.
(h) Maker shall make an assignment for the
benefit of creditors.
(i) A court of competent jurisdiction enters
a decree or order for relief with respect to Maker
under the United States Bankruptcy Code as now
constituted or hereafter amended or under any other
applicable Federal or state bankruptcy law or other
similar law, or such court enters a decree or order
appointing a receiver, liquidator, assignee, trustee
sequestrator (or similar official) of Maker, or of any
substantial part of its properties, or such court
decrees or orders the winding up or liquidation of the
affairs of Maker, and any such court order is not
vacated or stayed within ninety (90) days of entry.
(j) Maker files a petition or answer or
consent seeking relief under the United States
Bankruptcy Code as now constituted or hereafter
amended, or under any other applicable Federal or state
bankruptcy law or other similar law, or Maker consents
to the institution of proceedings thereunder or to the
filing of any such petition or to the appointment of or
taking possession by a receiver, liquidator, assignee,
trustee, custodian, sequestrator (or other similar
official) of Maker, or of any substantial part of its
properties, or Maker fails generally to pay its debts
as such debts become due, or Maker takes any action in
furtherance of any action described in this
subparagraph (j).
(k) There shall have occurred an event of
default under the Mortgage.
MAKER TO PAY EXPENSES
If Payee deems it necessary to take any legal action to
collect the indebtedness evidenced by this Note or any part
thereof, or to foreclose the Mortgage, or if this Note is placed
in the hands of an attorney for collection, Maker agrees to pay
all reasonable costs of collection when incurred, including
reasonable attorney's fees, which costs may be added to the
amount due under this Note and be receivable therewith. Costs of
collection include, but are not limited to reasonable attorney's
fees incurred, whether or not a lawsuit is commenced, including
reasonable attorney's fees for bankruptcy proceedings (such as,
for example, applications to modify or vacate any automatic stay,
object to any plan of reorganization and participation in any
hearing held in connection with such proceedings), appeals and
post-judgment collection proceedings.
MISCELLANEOUS
Payee may set off toward payment of any obligations under
this Note any indebtedness due or to become due from Payee to
Maker and any moneys or other property of Maker in possession of
Payee at any time.
The terms of this Note shall be governed by and construed
under the laws of the State of New York.
This Note may not be changed or terminated orally, but only
by an agreement in writing signed by the party against whom
enforcement of such change or termination is sought.
To the extent permitted by law, Maker waives the right to
trial by jury in any foreclosure or other action brought under
the Mortgage or any action brought by the Payee with respect to
the indebtedness evidenced by this Note. Maker agrees to submit
to personal jurisdiction in the State of New York in any action
or proceeding arising out of this Note, with venue in Xxxxxxxx
County, and, in furtherance of such agreement, Maker agrees and
consents that without limiting other methods of obtaining
jurisdiction, personal jurisdiction over them in any such action
or proceeding may be obtained within or without the jurisdiction
of any court located in New York and that any process or notice
of motion or other application to any such court in connection
with any such action or proceeding may be served upon Maker by
registered or certified mail to or by personal service at the
last known address of Maker, whether such address be within or
without the jurisdiction of any such court.
Maker (and the undersigned representative of Maker, if any)
represents that Maker has full power, authority and legal right
to execute and deliver this Note and that the Debt hereunder
constitutes a valid and binding obligation of Maker.
Whenever used, the singular number shall include the plural,
the plural the singular, and the words "Payee" and "Maker" shall
include their respective successors and assigns.
NO COURSE OF DEALING BETWEEN THE BORROWER AND THE BANK SHALL
CHANGE OR MODIFY OR DISCHARGE IN WHOLE OR IN PART THIS NOTE. NO
WAIVER OF ANY RIGHTS OR POWERS OF THE BANK OR CONSENT BY IT SHALL
BE VALID UNLESS IN WRITING AND SIGNED BY THE BANK.
IN WITNESS WHEREOF, Xxxxx has duly executed this Note as of
the day and year first above written.
EVAPORATED METAL FILMS CORP.
by: _______________________________
Xxxxx Xxxx, Authorized Officer
STATE OF NEW YORK )
COUNTY OF XXXXXXXX ) ss.:
On the 2nd day of October, 2006, before me, the undersigned,
a Notary Public in and for said State, personally appeared Xxxxx
Xxxx, personally known to me or proved to me on the basis of
satisfactory evidence to be the individual whose name is
subscribed to the within instrument and he 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 same.
__________________________________
Notary Public
XXXXXXXX TRUST COMPANY GUARANTEE
Dated: October 2, 2006 Ithaca, New York
Given by: Dynasil Corporation of America
FOR VALUABLE CONSIDERATION the undersigned Guarantor
unconditionally guarantees the payment when due, upon maturity,
acceleration or otherwise, of any and all indebtedness of
EVAPORATED METAL FILMS CORP. ("Borrower") to Xxxxxxxx Trust
Company (herein "Bank"), including all indebtedness now existing
or hereafter incurred pursuant to: (i) a note, dated concurrently
herewith, in the consolidated principal amount of $1,050,000.00,
made, executed and delivered by Xxxxxxxx ("Mortgage Note") and
(ii) a Commercial Line of Credit Agreement, dated December 22,
2005 in the consolidated principal amount of $215,000.00, made,
executed and delivered by Xxxxxxxx ("LOC"). The word Obligations
as used herein shall mean and include the principal sum, plus
interest thereon, reasonable attorneys' fees and costs of
collection incurred by Xxxxxxxx Trust Company in connection with
any action undertaken to enforce the terms of the Mortgage Note,
LOC, this Guarantee, and any and all such other amounts that may
be due from Borrower to Xxxxxxxx Trust Company pursuant to the
terms of the Mortgage Note, LOC, Mortgages, Security Agreements
and Collateral Assignments of Leases and Rents, and any other
instrument executed by Borrower in connection with the
Obligations (collectively the "Financing Documents").
This is a continuing, absolute and unconditional Guaranty
and shall continue in full force and effect until the date on
which all of the Obligations shall have been indefeasibly
satisfied in full by payment and performance of the Obligations
and shall not be affected or impaired by: (i) any transfer of all
or any part of the assets of Borrower to, or any consolidation or
merger of Borrower with or into, any other person, corporation or
legal entity, (ii) any bankruptcy, insolvency, reorganization or
similar proceeding involving or affecting Borrower, (iii) the
existence or non-existence of any security for the Obligations,
(iv) the invalidity or unenforceability of any of the Financing
Documents, (v) the existence or non-existence of any guaranty, or
right of set-off with respect to the Obligations at any time or
from time to time, (vi) any other defense, set-off or
counterclaim (other than a defense of payment or performance
strictly in accordance with the applicable terms of the Financing
Documents) that may at any time be available to or be asserted by
the Borrower or the Guarantor, (vii) any attempt, or failure to
attempt, to collect from any entity other than the Borrower or to
perfect or enforce any security, for the Obligations, or (vii)
any other action, occurrence or circumstance whatsoever.
Guarantor authorizes Bank, without notice or demand, and
without affecting or impairing Guarantor's liability hereunder,
from time to time to (a) renew, compromise, extend or otherwise
change the time for payment of, or otherwise change the terms of
the Obligations, to the extent permitted by the terms of the
Mortgage Note, including increasing or decreasing of the rate of
interest thereon; (b) take and hold security for the payment of
the Obligations and exchange, enforce, waive and release any such
security; (c) apply such security and direct the order or manner
of sale thereof as Xxxxxxxx Trust Company in its sole discretion
may determine; and (d) release or substitute any one or more
indorsers, Guarantor, borrowers or other obligors. Bank may
without notice assign this Guarantee in whole or in part.
This Guarantee shall not obligate Xxxxxxxx Trust Company to
do any of the following, each of which is specifically waived by
the Guarantor: (a) proceed against Borrower, the Guarantor or
any other party, (b) proceed against or exhaust any security held
from Borrowers, or (c) pursue any other remedy which might be
available to Xxxxxxxx Trust Company to collect the Obligations.
Guarantor waives any defense based on or arising out of any
defenses of Borrower other than payment in full of the
Obligations. Until all of the Obligations of Borrower pursuant
to the Financing Documents shall have been paid in full,
Guarantor shall have no rights to subrogation and Guarantor
waives any right to enforce any remedy which Xxxxxxxx Trust
Company now has or may hereafter have against Borrower and does
waive any benefit of, and any right to participate in any
security now or hereafter held by Xxxxxxxx Trust Company.
Guarantor waives all presentment, demand for performance, protest
and notice, including, without limitation, notice of non-
performance, notice of protest, notice of dishonor, and notice of
acceptance of this Guarantee, except that this waiver of notice
shall not relieve Xxxxxxxx County Trust Company from providing
such notices to Borrower, if any, as may be required pursuant to
the terms of the Mortgage Note.
No right or power of Xxxxxxxx Trust Company hereunder shall
be deemed to be waived by any act or conduct on the part of
Xxxxxxxx Trust Company, or by any neglect to exercise such right
or power, or by any delay in so doing, and right or power shall
continue in full force effect unless specifically waived or
released by an instrument in writing executed by Xxxxxxxx Trust
Company. This Guarantee shall remain in full force and effect
and the Guarantor shall be liable thereon until all Obligations
have been indefeasibly satisfied in full.
Guarantor agrees that all payments of any amounts in respect
of any Obligations owed by Xxxxxxxx to Guarantor ("Personal
Loans") shall be subordinated and junior, in the manner
hereinafter set forth, in right of payment to the prior payment
in full of the Obligations and the Personal Loans are hereby
subordinated as a claim against Borrower or any of Borrower's
assets, whether such claim be in the ordinary course of business
or in the event of any dissolution, liquidation, bankruptcy,
receivership or reorganization of Borrower, to the prior payment
in full of the Obligations. No payment of principal of or
interest on the Personal Loans shall be made (i) unless the
Obligations has been paid in full or (ii) unless immediately
after giving effect to such payment there shall exist no event of
default, or an event which with the passage of time or the giving
of notice or both would become an event of default, under any of
the Financing Documents. If a payment is made to the holder of
the Personal Loans in violation of the foregoing provisions, such
payment shall be held by such holder in trust for the benefit the
Bank.
This Guarantee shall be deemed to be made under and shall be
governed by the laws of the State of New York in all respects,
including matters of construction, validity and performance, and
the terms and provisions hereof may not be waived, altered,
modified or amended except in a writing duly signed by an
authorized officer of Xxxxxxxx Trust Company and by Guarantor.
If any of the provisions of this Guarantee shall contravene
or be held invalid under the laws of the jurisdiction, this
Guarantee shall be construed as if not containing those
provisions and the rights and obligations of the parties hereto
shall be construed and enforced accordingly.
The Guarantee shall bind the undersigned Guarantor, and its
legal representatives, successors and assigns, and this Guarantee
shall inure to the benefit of Xxxxxxxx Trust Company and its
successors and assigns.
NO COURSE OF DEALING BETWEEN THE GUARANTOR AND THE BANK SHALL
CHANGE OR MODIFY OR DISCHARGE IN WHOLE OR IN PART THIS GUARANTEE.
NO WAIVER OF ANY RIGHTS OR POWERS OF THE BANK OR CONSENT BY IT
SHALL BE VALID UNLESS IN WRITING AND SIGNED BY THE BANK.
IN WITNESS WHEREOF the undersigned Xxxxxxxxx has duly
executed this Guarantee on October 2, 2006.
Dynasil Corporation of America
by: _______________________________
Xxxxx X. Xxxxxx, President
STATE OF NEW YORK )
COUNTY OF XXXXXXXX ) ss.:
On the 2nd day of October, 2006, before me, the undersigned,
a Notary Public in and for said State, personally appeared Xxxxx
X. Xxxxxx, personally known to me or proved to me on the basis of
satisfactory evidence to be the individual whose name is
subscribed to the within instrument and he 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 same.
__________________________________
Notary Public
XXXXXXXX TRUST COMPANY SECURITY AGREEMENT
Ithaca, New York
October 2, 2006
FOR VALUE RECEIVED, EVAPORATED METAL FILMS CORP., a New York
Corporation maintaining an office at 000 Xxxxxx Xxxxxx, Xxxxxx,
Xxx Xxxx 00000 ("Borrower") hereby grants to XXXXXXXX TRUST
COMPANY, maintaining its office The Commons, Ithaca, New York
14850 (herein "TTC") a security interest in the following
described property upon the following terms and conditions:
1. Security Interest. As security for the Secured
Obligations described in section 2 hereof, Borrower hereby grants
to TTC a prior security interest in and valid lien on all of the
property described below, together with any and all additions
thereto and replacements and proceeds thereof: all now existing or
hereafter acquired machinery, furniture, equipment, fixtures and
leases used at or in connection with the real property located at
000 Xxxxxx Xxxxxx, Xxxx xx Xxxxxx, Xxxxxxxx Xxxxxx, Xxx Xxxx
(hereinafter referred to collectively as the "Collateral").
2. Secured Obligations. The security interest hereby
granted shall secure the due and punctual payment and performance
of the all liabilities and obligations of Borrower to TTC (herein
called the "Secured Obligations"), including the following:
(a) Principal and interest pursuant to note (the
"Note") made, executed and delivered by Borrower to TTC, dated
concurrently herewith, in the consolidated amount of
$1,050,000.00, together with any and all amendments, renewals and
modifications thereof.
3. Special Warranties and Covenants of Borrower. Borrower
hereby warrants and covenants to Bank that:
(a) The address shown at the beginning of this
Agreement is the principal place of residence or business of
Borrower. Borrower will not change its principal or any other
place of business without the prior written consent of the Bank,
which consent will not unreasonably be withheld or delayed.
(b) Borrower will not sell, encumber or otherwise
dispose of any of the Collateral or any interest therein, except
in the ordinary course of business or with the prior written
consent of the Bank, which consent will not unreasonably be
withheld or delayed.
(c) Borrower will promptly execute and deliver to Bank
such financing statements, certificates and other documents or
instruments as may be reasonably necessary to enable Bank to
perfect or from time to time renew the security interest granted
hereby.
(d) Upon request, Borrower will give Bank notice of
each office of Borrower at which records of Borrower pertaining to
the Collateral are kept. Except as such notice is given,
Xxxxxxxx's records concerning the Collateral are and will be kept
at the address shown at the beginning of this Agreement as the
principal place of business of Borrower. Bank may examine such
records, from time to time, upon Bank's reasonable notice to
Xxxxxxxx.
(e) Borrower irrevocably appoints Bank as his agent
with full authority to execute and file any financing statements
to perfect the security interest granted herein.
4. Rights of Bank. Upon the occurrence of any Event of
Default (as defined in Section 6 hereof), such default not having
previously been remedied or cured, Bank may declare all of the
Secured Obligations to be immediately due and payable and shall
then have the rights and remedies of a secured party under the
Uniform Commercial Code or under any other applicable laws,
including, without limitation, the right to:
(a) notify debtors or obligers, pursuant to U.C.C. Section 9-
502, on any accounts or chattel paper, or any buyers or lessees of
any of the Collateral of any other persons, of Bank's interest in
the Collateral and require such persons to deliver all proceeds to
Bank, or such other person as Bank may designate, at such time or
times and in such manner and form as Bank may direct;
(b) exercise any right of set-off which Bank may have
against Borrower, any other obligor or guarantor or any
Collateral;
(c) exercise all or any of the rights and remedies of a
secured party under the Uniform Commercial Code or as creditor
under any other applicable law including, without limitation, the
right to require Borrower to assemble the Collateral and any
records pertaining thereto and make them available to Bank at a
time and place designated by Bank;
(d) enter the premises of Borrower and take possession
of the Collateral and any records pertaining thereto; and also
take possession of all personal property located in or attached to
Collateral without liability to Borrower and hold such property
for Borrower at Borrower's expense;
(e) use, operate, manage, lease or otherwise control the
Collateral in any lawful manner, collect and receive all rents,
income, revenue, earnings, issues and profits therefrom and, in
its sole discretion but without any obligation to do so, insure,
maintain repair, renovate, alter or remove the Collateral;
(f) grant extensions or compromises or settle claims for
less than face value relative to the Proceeds without prior notice
to Borrower or any other guarantor or obligor;
(g) use, in connection with any assembly, use or
disposition of the Collateral, any trademark, trade name, trade
style, copyright, brand, patent, patent right, license or
technical process used or utilized by Borrower;
(h) take such actions as Bank may deem necessary or
advisable to preserve, process, develop, maintain, protect, care
for or insure the Collateral or any portion thereof, and Borrower
irrevocably appoints Bank its attorney-in-fact to do all acts and
things in connection therewith; or
(i) take any action which Bank may deem necessary or
desirable in order to realize on any of the Collateral, including
without limitation the power to perform and contract or to endorse
in the name of Borrower any checks, notes, drafts, receipts or
other instruments or documents received in payment of or on
account of, or constituting, any of the Collateral, and Borrower
irrevocably appoints Bank its attorney-in-fact with full power of
substitution for all or any such acts or purposes; and
(j) sell or otherwise dispose of all or any of the
Collateral at any public or private sale at any time or times with
or without advertisement or demand upon five (5) calendar days
prior written notice to Borrower or any other obligor or guarantor
or which Borrower acknowledges to be sufficient and commercially
reasonable, with the right of Bank or its nominee to become
purchaser at any sale (unless prohibited by statute) free from any
equity of redemption and from all other claims, and after
deducting all expenses for which Xxxxxxxx is responsible pursuant
to this Agreement, apply the remaining proceeds of any sale or pay
(or hold as a reserve against) any of the Secured Obligations.
Except to the extent limited by non-waivable provision of
statute, Bank shall not be liable to any person whatsoever, for,
or in connection with, the exercise, method of exercise, delay or
failure to exercise any of the remedies provided for herein, and
Borrower shall indemnify, and agrees to hold harmless and waives
and releases Bank from any and all claims, liabilities, actions,
costs, suits, demands or losses whatsoever occurring on account of
or in connection with such exercise, method or exercise, delay or
failure to exercise.
5. Rights of Bank to Use and Operate Collateral, Etc. Upon
the occurrence of any Event of Default, but subject to the
provisions of the Uniform Commercial Code or other applicable law,
Bank shall have the right and power to take possession of all or
any part of the Collateral, and to litigate, compromise, extend,
renew or otherwise deal with the Collateral and may endorse
Borrower's name on account or contract payments received by Bank.
6. Events of Default. Borrower shall be in default under
this Agreement if any of the following events (herein called
"Events of Default") shall occur:
(a) Default shall be made in the due and punctual
payment of any payment of principal or of interest on any of the
Liabilities as and when the same shall become due and payable
(whether at maturity or at a date fixed for any prepayment or
installment or by declaration or acceleration or otherwise) and
such default shall continue beyond the expiration of the
applicable period of grace, if any;
(b) Any other Event of Default (as defined or provided
in the Note or in any Mortgage or other agreement granted to Bank
to secure repayment of the Liabilities) shall occur and such Event
of Default shall continue beyond the expiration of the applicable
period of grace, if any;
(c) Failure by the Borrower to observe in all material
respects any material covenant, agreement, condition or term of
this Security Agreement;
(d) The occurrence of a material default under any
agreement or instrument now or hereafter in connection with any of
the Liabilities or breach by Borrower or any other Obligor (which
term shall refer to any maker, co-maker, endorser, guarantor or
surety of, or other person obligated under any statute for, any of
the Liabilities) of any obligation or duty to Bank;
(e) Any representation or warranty in any material
financial or other statement, schedule, certificate, or other
document of Borrower or any other Obligor delivered to Bank by or
on behalf of Borrower or any other Obligor shall prove to be
false, misleading or incomplete in any material respect;
(f) A material adverse change occurs in the financial
condition of Borrower or any other Obligor which is reasonably
unacceptable to Bank in its sole discretion from the condition
most recently disclosed to Bank in any manner;
(g) Borrower dissolves, liquidates, merges,
reorganizes, changes its name, sells or otherwise disposes of
substantially all of its assets or ceases to conduct operations,
or prepares or attempts to do any of the foregoing;
(h) A trustee or receiver is appointed for Borrower or
any other Obligor, or Borrower or any other Obligor or for all or
a substantial part of its or their property or Borrower or any
other Obligor commences any bankruptcy or other similar
proceedings under any insolvency law, state or federal, or any
such proceeding is commenced against Borrower or any other
Obligor, or Borrower or any other Obligor becomes insolvent, or
generally fails to pay or is generally unable to pay its debts, or
makes an assignment for the benefit of creditors or admits in
writing its insolvency or inability or failure to pay its debts
generally as they become due, or fails within 30 days to pay or
bond or otherwise discharge any judgment which is unstayed pending
appeal;
(i) Borrower or any other Obligor expresses an intent
to terminate or revoke responsibility for any Liabilities;
(j) Any Collateral becomes the subject of any
attachment, garnishment, levy or lien except for liens arising and
discharged in the ordinary course of business (unless expressly
permitted in writing signed by Bank which permission shall not
unreasonably be withheld or delayed);
(k) Except in the ordinary course of business, Borrower
or any other Obligor assigns or otherwise transfers, or attempts
to assign or transfer, any of its right, title and interest in any
of the Collateral without the prior written consent of the Bank;
or
(l) Borrower or any other Obligor fails to furnish
financial or other information as Bank may reasonably request.
7. Waivers, Etc. Borrower hereby waives presentment,
demand, notice, protest and, except as is otherwise provided
herein, all other demands and notices in connection with this
Agreement or the enforcement of the rights of Bank hereunder or in
connection with any Secured Obligations or any Collateral;
consents to and waives notice of the granting of renewals,
extensions of time for payment or other indulgences to Borrower,
or the substitution, release or surrender of any Collateral, the
addition or release of persons primarily or secondarily liable on
any Secured Obligation, the acceptance of partial payments on any
of the Secured Obligations. No delay or omission on the part of
Bank in exercising any right hereunder shall operate as a waiver
of such right or of any other right hereunder. Any waiver of any
such right on any one occasion shall not be construed as a bar to
or waiver of any such right on any such future occasion.
8. Termination; Assignment, Etc. This Agreement and the
security interest in the Collateral created hereby shall terminate
when all of the Secured Obligations have been paid and finally
discharged in full. No waiver by Bank or by any other holder of
Secured Obligations of any default shall be effective unless in
writing nor operate as a waiver of any other default or of the
same default on a future occasion. In the event of a sale or
assignment by Bank of all or any of the Secured Obligations held
by it such purchaser or assignee shall become vested with all of
the powers and rights of Bank hereunder, and Bank shall thereafter
be forever released and fully discharged from any liability or
responsibility hereunder with respect to the rights and interest
so assigned.
9. Notices. Except as otherwise provided herein, notice to
Borrower or to Bank shall be in writing and deemed to have been
sufficiently given or served for all purposes hereof if personally
delivered or mailed by first class mail, postage prepaid, to the
respective party at the address set forth hereinabove.
10. Miscellaneous. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their
respective heirs, successors and assigns. In case a court of
competent jurisdiction shall hold any provision in this Agreement
to be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any
way be affected or impaired thereby. This Agreement may be
executed in any number of counterparts and by the different
parties hereto on separate counterparts, each of which when
executed and delivered shall be an original, but all of which
together shall constitute one instrument.
11. Costs and Expenses. Upon the occurrence of an Event of
Default, or if Bank shall appear in, defend, or bring any action
or proceeding to protect its interest in the Collateral, to
foreclose upon the security interest granted herein, or collect
the Liabilities, the costs and expenses thereof (including
reasonable attorneys fees whether or not an action has been
commenced), with interest as provided in this paragraph, shall be
paid by Borrower to Bank upon demand. All such costs and expenses
incurred by Bank shall bear interest at the rate set forth in the
Note plus two (2) percentage points, from the date incurred.
These costs and expenses include, but are not limited to, the
reasonable expenses in retaking, holding, improving, repairing,
preparing for sale or lease, selling, leasing and the like. All
such costs and expenses, together with interest thereon, shall
constitute part of the Liabilities secured hereby.
12. Governing Law. This Agreement shall be construed in
accordance with and governed by the laws of the State of New York.
NO COURSE OF DEALING BETWEEN THE BORROWER AND THE BANK SHALL
CHANGE OR MODIFY OR DISCHARGE IN WHOLE OR IN PART THIS SECURITY
AGREEMENT. NO WAIVER OF ANY RIGHTS OR POWERS OF THE BANK OR
CONSENT BY IT SHALL BE VALID UNLESS IN WRITING AND SIGNED BY THE
BANK.
IN WITNESS WHEREOF, Xxxxxxxx has executed this Agreement
as of the date first above written.
EVAPORATED METAL FILMS CORP.
by: _______________________________
Xxxxx Xxxx, Authorized Officer
STATE OF NEW YORK )
COUNTY OF XXXXXXXX ) ss.:
On the 2nd day of October, 2006, before me, the undersigned,
a Notary Public in and for said State, personally appeared Xxxxx
Xxxx, personally known to me or proved to me on the basis of
satisfactory evidence to be the individual whose name is
subscribed to the within instrument and he 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 same.
__________________________________
Notary Public
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Agreement_9-21.doc
