THIS INSTRUMENT WAS PREPARED BY
AND AFTER RECORDING SHOULD BE
RETURNED TO:
Xxx X. Xxxxxx
Xxxxxx & Xxxxxx
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Xxxxxxxxxx County, Maryland
AMENDED AND RESTATED DEED OF TRUST,
WITH ABSOLUTE ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT, ASSIGNMENT OF EQUIPMENT LEASES,
ASSIGNMENT OF PERMITS AND FIXTURE FILING
THE PARTIES TO THIS AMENDED AND RESTATED DEED OF TRUST,
WITH ABSOLUTE ASSIGNMENT OF LEASES AND RENTS, SECURITY
AGREEMENT, ASSIGNMENT OF EQUIPMENT LEASES, ASSIGNMENT
OF PERMITS AND FIXTURE FILING ("Deed of Trust"), made
as of December 13, 1996, are MONTROSE OFFICE PARK JOINT
VENTURE, a Maryland joint venture ("Grantor"), having
its chief executive office at c/o Glenborough
Corporation, 000 Xxxxx Xx Xxxxxx Xxxx, 11th Floor, San
Mateo, California 94402, CHICAGO TITLE INSURANCE
COMPANY, a Missouri corporation ("Trustee"), having an
office at 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx
00000, and XXXXX FARGO
BANK, NATIONAL ASSOCIATION ("Beneficiary"), having an
office at 000 Xxxxx Xxxxx, Xxxxx 000, Xxx Xxxxxxx,
Xxxxxxxxxx 00000, (as may be modified, amended,
supplemented or restated from time to time the "Deed of
Trust").
Recitals
A. Grantor is the present owner of the fee simple
interest in and to all the land and premises situate in
Xxxxxxxxxx County, Maryland (the "Land"), as more
particularly described on Exhibit A attached hereto and
made a part hereof.
B. Grantor is the obligor of that certain
Promissory Note, dated as of December 17, 1986, in
original principal amount of Fourteen Million Two
Hundred Ten Thousand and No/100s Dollars
($14,210,000.00)(as heretofore modified, the "Original
Note") made and given by Grantor to and in favor of The
Variable Annuity Life Insurance Company, a Texas
corporation ("Original Lender"), which Original Note
was modified pursuant to that certain Note Modification
Agreement between Grantor and Original Lender filed of
record December 31, 1991, in the
Clerk's Office of Xxxxxxxxxx County, Maryland, in Liber
10102, Folio 144 (the "Modification Agreement").
C. The Original Note is secured by, inter alia,
(i) that certain Deed of Trust and Security Agreement
dated as of December 17, 1986, made and given by
Grantor, to Xxxx X. Xxxxxxx ("Original Trustee"), for
the benefit of Original Lender, as Beneficiary, filed
of record December 17, 1986, in the Clerk's Office of
Xxxxxxxxxx County, Maryland, in Liber 7449, Folio 416
(as modified by the Modification Agreement, the
"Original Deed of Trust"), and (ii) that certain
Assignment of Lessor's Interest in Lease dated as of
December 17, 1986, made and given by Borrower, as
Assignor, to Original Lender, as Assignee, filed of
record December 17, 1986, in the Clerk's Office of
Xxxxxxxxxx County, Maryland, in Liber 7449, Folio 455
(as modified by the Modification Agreement, the
"Original Assignment of Leases").
D. At the request of Grantor, Beneficiary has
purchased the Original Note from the Original Lender,
and received an assignment of the Original Note, the
Original Deed of Trust, the Original Assignment of
Leases and the other documents securing the Original
Note (collectively, the "Original Loan Documents") by
virtue of that certain Assignment of Deed of Trust and
Other Loan Documents dated of even date herewith and
recorded in the Land Records; provided that
Beneficiary's purchase of the Original Loan Documents
was conditioned upon the modification of the terms of
the Original Note as set forth in that certain Amended,
Restated and Consolidated Promissory Note of even date
herewith, in the aggregate principal amount of Twenty-Six
Million Six Hundred Fifty Thousand and No/100s
Dollars ($26,650,000.00), executed by Grantor and
Prudential-Bache/Equitec Real Estate Partnership, a
California limited partnership ("Co-Borrower; Grantor
and Co-Borrower being collectively referred to herein
as "Borrowers") and payable to the order of Beneficiary
(as the same may be modified, amended, supplemented,
replaced or restated from time to time, the "Note"),
and Grantor has agreed to such amendments.
E. Grantor desires to (i) modify the Original Deed
of Trust and Original Assignment of Leases for the
purpose of securing the Note and (ii) affirm its
intention that the Original Deed of Trust and Original
Assignment of Leases, as amended and restated by this
Deed of Trust, shall continue as a valid lien on the
Subject Property hereinafter described.
F. By a Deed of Appointment of Substitute Trustees
dated of even date herewith and recorded among the Land
Records, Beneficiary has appointed the Trustee to act
in place of the Original Trustee under the Original
Deed of Trust.
G. This Deed of Trust is not intended to be a
release or discharge of the lien of the Original Deed
of Trust.
H. These recitals are intended by the parties to
be and are hereby made a material part of this Deed of
Trust.
I. In order to secure to the Beneficiary the full
repayment of the Note, Grantor now wishes to modify and
restate the Original Deed of Trust, as hereinafter set
forth.
2
Agreement
NOW THEREFORE, in order to induce Beneficiary to
modify the Original Note, and to secure repayment to
Beneficiary by Borrowers of the total principal amount
of the Note, and for other good and valuable
consideration, the receipt and sufficiency of which are
hereby acknowledged, Grantor hereby modifies, reaffirms
and restates the Original Deed of Trust and the
Original Assignment of Leases in its entirety, in the
form and manner stated below, including as an integral
part thereof, the foregoing Recitals:
NOW, THEREFORE, THIS DEED OF TRUST WITNESSETH:
ARTICLE 1. GRANT IN TRUST
1.1 GRANT. For the purposes of and upon the terms
and conditions in this Deed of Trust, Grantor
irrevocably grants, conveys and assigns to
Trustee, in trust for the benefit of
Beneficiary, with power of sale and right of
entry and possession, all of Grantor's right,
title and interest in all of the real property
located in Xxxxxxxxxx County, Maryland and
described on Exhibit A attached hereto and made
a part hereof, together with all of Grantor's
right, title and interest in all development
rights or credits, air rights, water, water
rights and water stock related to the real
property, and all minerals, oil and gas, and
other hydrocarbon substances in, on or under
the real property, and all appurtenances,
easements, rights and rights of way appurtenant
or related thereto; all streets, roads and
alleys (whether open, proposed or vacated); all
buildings, other improvements and fixtures now
or hereafter located on the real property,
including, but not limited to, all apparatus,
equipment, and appliances used in the operation
or occupancy of the real property, it being
intended by the parties that all such items
shall be conclusively considered to be a part
of the real property, whether or not attached
or affixed to the real property (collectively,
the "Improvements"); all interest or estate
which Grantor may hereafter acquire in the
property described above, and all additions and
accretions thereto, and the proceeds of any of
the foregoing (all of the foregoing being
collectively referred to as the "Subject
Property"). The listing of specific rights or
property shall not be interpreted as a limit of
general terms.
1.2 NON-AGRICULTURAL USE. Grantor represents and
warrants to Beneficiary and Trustee that the
Subject Property is not used principally for
agricultural or farming purposes.
ARTICLE 2. OBLIGATIONS SECURED
2.1 OBLIGATIONS SECURED. Grantor makes this grant
and assignment for the purpose of securing the
following obligations ("Secured Obligations"):
(a) Payment to Beneficiary of all sums at any
time owing under the Note; and
3
(b) Payment and performance of all covenants
and obligations of Grantor under this Deed
of Trust; and
(c) Payment and performance of all covenants
and obligations on the part of Grantor
under that certain Loan Agreement, of even
date herewith, by and between Grantor and
Co-Borrower and Beneficiary (as may be
modified, amended, supplemented or
restated from time to time, the "Loan
Agreement") (capitalized terms used herein
but not defined herein shall have the
meaning provided for such terms in the
Loan Agreement); and
(d) Payment and performance of all covenants
and obligations on the part of each of the
Borrowers under all of the Loan Documents;
and
(e) Payment and performance of all future
advances and other obligations that the
then record owner of all or part of the
Subject Property may agree to pay and/or
perform (whether as principal, surety or
guarantor) for the benefit of Beneficiary,
when such future advance or obligation is
evidenced by a writing which recites that
it is secured by this Deed of Trust; and
(f) All modifications, extensions and renewals
of any of the obligations secured hereby,
however evidenced, including, without
limitation: (i) modifications of the
required principal payment dates or
interest payment dates or both, as the
case may be, deferring or accelerating
payment dates wholly or partly; and (ii)
modifications, extensions or renewals at a
different rate of interest whether or not
in the case of the Note, the modification,
extension or renewal is evidenced by a new
or additional promissory note or notes.
2.2 OBLIGATIONS. The term "obligations" is used
herein in its broadest and most comprehensive
sense and shall be deemed to include, without
limitation, all protective advances and all
sums advanced to protect the Subject Property
or the lien of this Deed of Trust or otherwise
disbursed or incurred under the terms of the
Loan Documents, all interest and charges,
prepayment charges (if any), late charges and
loan fees at any time accruing or assessed on
any of the Secured Obligations; provided,
however, that the terms "obligations" and
"Secured Obligations" as used herein shall in
no event include any obligations arising under
the Guaranty or the Hazardous Materials
Indemnity.
2.3 INCORPORATION. All terms of the Secured
Obligations and the documents evidencing such
obligations are incorporated herein by this
reference. All persons who may have or acquire
an interest in the Subject Property shall be
deemed to have notice of the terms of the
Secured Obligations and to have notice that the
rate of interest on one or more Secured
Obligations may vary from time to time.
4
ARTICLE 3. ASSIGNMENT OF LEASES AND RENTS
3.1 ASSIGNMENT. Grantor hereby irrevocably assigns
to Beneficiary all of Grantor's right, title
and interest in, to and under: (a) all leases
of the Subject Property or any portion thereof,
and all other agreements of any kind relating
to the use or occupancy of the Subject Property
or any portion thereof, whether now existing or
entered into after the date hereof ("Leases");
and (b) the rents, issues, deposits, profits
and revenues of the Subject Property and the
operations conducted thereon, including,
without limitation, all amounts payable and all
rights and benefits accruing to Grantor under
the Leases ("Payments"). The term "Leases"
shall also include all guarantees of and
security for the lessees' performance
thereunder, and all amendments, extensions,
renewals or modifications thereto which are
permitted hereunder. This is a present and
absolute assignment, not an assignment for
security purposes only, and Beneficiary's right
to the Leases and Payments is not contingent
upon, and may be exercised without possession
of, the Subject Property, and without the
commencement of a foreclosure action or the
appointment of a receiver. Furthermore, upon
any Default, Beneficiary shall be entitled to
receive pursuant to the foregoing assignment,
and Grantor shall be obligated to deliver to
Beneficiary or its designee (including any
receiver), any and all Payments collected by
Grantor which remain in the possession or
control of Grantor, whether or not commingled
with other funds or Grantor, and whether
collected by Grantor before or after the
occurrence of the Default.
3.2 GRANT OF LICENSE. Beneficiary confers upon
Grantor a license ("License") to collect and
retain the Payments as they become due and
payable, until the occurrence of a Default.
Upon a Default, the License shall be
automatically revoked and Beneficiary may
collect and apply the Payments pursuant to
Section 6.4 without notice and without taking
possession of the Subject Property. Grantor
hereby irrevocably authorizes and directs the
lessees under the Leases to rely upon and
comply with any notice or demand by Beneficiary
for the payment to Beneficiary of any rental or
other sums which may at any time become due
under the Leases, or for the performance of any
of the lessees' undertakings under the Leases,
and the lessees shall have no right or duty to
inquire as to whether any Default has actually
occurred or is then existing hereunder.
Grantor hereby relieves the lessees from any
liability to Grantor by reason of relying upon
and complying with any such notice or demand by
Beneficiary.
3.3 EFFECT OF ASSIGNMENT. The foregoing
irrevocable assignment shall (in and of itself)
not cause Beneficiary to be: (a) a mortgagee
in possession; (b) responsible or liable for
the control, care, management or repair of the
Subject Property or for performing any of the
terms, agreements, undertakings, obligations,
representations, warranties, covenants and
conditions of the Leases; (c) responsible or
liable for any waste committed on the Subject
Property by the
5
lessees under any of the Leases
or any other parties; (d) responsible or liable
for any dangerous or defective condition of the
Subject Property; or (e) responsible or liable
for any negligence in the management, upkeep,
repair or control of the Subject Property
resulting in loss or injury or death to any
lessee, licensee, employee, invitee or other
person. Beneficiary shall not directly or
indirectly be liable to Grantor or any other
person as a consequence of: (i) the exercise
or failure to exercise any of the rights,
remedies or powers granted to Beneficiary
hereunder; or (ii) the failure or refusal of
Beneficiary to perform or discharge any
obligation, duty or liability of Grantor
arising under the Leases.
3.4 COVENANTS. Grantor covenants and agrees at
Grantor's sole cost and expense to: (a)
perform the obligations of lessor contained in
the Leases and enforce by all available
remedies performance by the lessees of the
obligations of the lessees contained in the
Leases; (b) deliver to Beneficiary fully
executed, counterpart original(s) of each and
every Lease if requested to do so; and (c)
execute and record (or cause to be executed and
recorded) such additional assignments of any
Lease or specific subordinations of any Lease
to this Deed of Trust, in form and substance
acceptable to Beneficiary, as Beneficiary may
reasonably request. Grantor shall not, without
Beneficiary's prior written consent or as
otherwise permitted by any provision of the
Loan Agreement or as otherwise permitted above:
(i) execute any other assignment relating to
any of the Leases; (ii) discount any rent or
other sums due under the Leases or collect the
same in advance, other than to collect rent one
(1) month in advance of the time when it
becomes due; (iii) modify, amend (if such
modification or amendment would result in the
Lease being less favorable to Grantor or
Beneficiary than presently existing) or
terminate any of the Leases or in any manner
release or discharge the lessees from any
obligations thereunder; (iv) consent to any
assignment or subletting by any lessee; or (v)
subordinate or agree to subordinate any of the
Leases to any other deed of trust or encum-
brance. Any such attempted action in violation
of the provisions of this Section 3.4 shall be
null and void.
3.5 ESTOPPEL CERTIFICATES. Within thirty (30) days
after request by Beneficiary, Grantor shall use
its reasonable efforts to deliver to
Beneficiary and to any party designated by
Beneficiary estoppel certificates executed by
Grantor and by the lessees, certifying: (i)
that the foregoing assignment and the Leases
are in full force and effect; (ii) the date of
each lessee's most recent payment of rent;
(iii) that there are no defenses or offsets
outstanding, or stating those claimed by
Grantor or the lessees under said Leases; (iv)
that no default exists under any of the Leases
and no condition exists that after the giving
of notice, the passage of time or both would
constitute a default under any of the Leases;
and (v) any other information reasonably
requested by Beneficiary.
6
ARTICLE 4. SECURITY AGREEMENT, ASSIGNMENT OF EQUIPMENT LEASES,
ASSIGNMENT OF PERMITS AND FIXTURE FILING
4.1 SECURITY INTEREST. Grantor hereby grants and
assigns to Beneficiary, as of the Effective
Date, a security interest, to secure payment
and performance of all of the Secured
Obligations, in all of the following described
personal property in which Grantor now or at
any time hereafter has any interest
(collectively, the "Collateral"):
All goods, building and other
materials, supplies, work in process,
equipment, machinery, fixtures,
furniture, furnishings, signs and
other personal property, wherever
situated, which are or are to be
incorporated into, used in connection
with, or appropriated for use on the
real property described on Exhibit A
attached hereto and incorporated by
reference herein (to the extent the
same are not effectively made a part
of the real property pursuant to
Section 1.1 above); together with all
rents, issues, deposits and profits of
the Subject Property; all inventory,
accounts, cash receipts, deposit
accounts, accounts receivable,
contract rights, general intangibles,
judgments, chattel paper, instruments,
documents, notes, drafts, letters of
credit, insurance policies, insurance
and condemnation awards and proceeds,
any other rights to the payment of
money, trade names, trademarks and
service marks arising from or related
to the Subject Property or any
business now or hereafter conducted
thereon by Grantor; subject to Section
4.8, all permits, consents, approvals,
licenses, authorizations and other
rights granted by, given by or
obtained from, any governmental entity
with respect to the Subject Property;
all deposits or other security now or
hereafter made with or given to
utility companies by Grantor with
respect to the Subject Property; all
advance payments of insurance premiums
made by Grantor with respect to the
Subject Property; all plans, drawings
and specifications relating to the
Subject Property; all loan funds held
by Beneficiary, whether or not
disbursed; all funds deposited with
Beneficiary pursuant to any loan
agreement or any other document or
right of Beneficiary; all reserves,
deferred payments, deposits, accounts,
refunds, cost savings and payments of
any kind related to the Subject
Property or any portion thereof; all
other items of personal property (of
whatever kind or nature) used in the
operation of the Subject Property; all
of the rights and interest of Grantor
in and under all management
agreements, franchise agreements and
leasing agreements affecting all or
any portion of the Subject Property;
all of the rights and interest of
Grantor in and to those accounts that
have been (or may hereafter be)
established with Beneficiary; all of
the rights and interest of Grantor in
and to any interest rate protection
agreement that may
7
have been (or may
hereafter be) entered into by Grantor
in connection with the Loan; all
rents, revenues, issues, profits and
income generated from the operation of
the Subject Property; subject to
Section 4.7, all rights of Grantor as
lessee under all chattel leases
relating to furniture, fixtures,
equipment or any other item used in
connection with the operation of the
Subject Property; together with all
replacements and proceeds of, and
additions and accessions to, any of
the foregoing; together with all
books, records and files relating to
any of the foregoing.
As to all of the above described personal
property which is or which hereafter becomes a
"fixture" under applicable law, this Deed of
Trust constitutes a fixture filing under the
Maryland Uniform Commercial Code, as amended or
recodified from time to time ("UCC").
4.2 REPRESENTATIONS AND WARRANTIES. Grantor
represents and warrants that (subject to the
Permitted Encumbrances): (a) Grantor has good
title to the Collateral; and (b) Grantor has
not previously assigned or encumbered the
Collateral, and no financing statement covering
any of the Collateral has been delivered by
Grantor to any other person or entity.
4.3 RIGHTS OF BENEFICIARY. In addition to
Beneficiary's rights as a "Secured Party" under
the UCC, Beneficiary may, but shall not be
obligated to, at any time without notice
(except as provided below) and at the expense
of Grantor: (a) give notice to any person of
Beneficiary's rights hereunder and enforce such
rights at law or in equity; (b) insure,
protect, defend and preserve the Collateral or
any rights or interests of Beneficiary therein;
and (c) inspect the Collateral at reasonable
times and upon reasonable prior notice.
Notwithstanding the above, in no event shall
Beneficiary be deemed to have accepted any
property other than cash in satisfaction of any
obligation of Grantor to Beneficiary unless
Beneficiary shall make an express written
election of said remedy under the UCC, or other
applicable law.
4.4 RIGHTS OF BENEFICIARY ON DEFAULT. Upon the
occurrence of a Default, in addition to all of
Beneficiary's rights as a "Secured Party" under
the UCC or otherwise at law:
(a) Beneficiary may (i) upon written notice,
require Grantor to assemble any or all of
the Collateral and make it available to
Beneficiary at a place designated by
Beneficiary; (ii) without prior notice,
enter upon the Subject Property or other
place where any of the Collateral may be
located and take possession of, collect,
sell, and dispose of any or all of the
Collateral, and store the same at
locations acceptable to Beneficiary at
Grantor's expense; and (iii) sell, assign
and deliver at any place or in any lawful
8
manner all or any part of the Collateral
and bid and become purchaser at any such
sales; and
(b) Beneficiary may, for the account of
Grantor and at Grantor's expense: (i)
operate, use, consume, sell or dispose of
the Collateral as Beneficiary deems
appropriate for the purpose of performing
any or all of the Secured Obligations;
(ii) enter into any agreement, compromise,
or settlement, including insurance claims,
which Beneficiary may deem desirable or
proper with respect to any of the
Collateral; (iii) endorse, collect and
receive any right to payment of money
owing to Grantor under or from the
Collateral; and (iv) endorse and deliver
evidences of title for, and receive,
enforce and collect by legal action or
otherwise, all indebtedness and
obligations now or hereafter owing to
Grantor in connection with or on account
of any or all of the Collateral.
Any disposition of so much of the Collateral as
may constitute personal property subject to the
security interest created by this Deed of Trust
shall be considered commercially reasonable if
made pursuant to a public sale which is
advertised at least twice in a newspaper of
local circulation in the community where the
Collateral is located. Any notice required by
Section 9-504 of the Commercial Law Article of
the Annotated Code of Maryland, as amended, to
be given to the Grantor shall be considered
reasonable and properly given if given in the
manner and at the address provided in the
notice provisions of this Deed of Trust at
least ten (10) calendar days prior to the date
of any scheduled public sale.
4.5 POWER OF ATTORNEY. Grantor hereby irrevocably
appoints Beneficiary as Grantor's
attorney-in-fact (such agency being coupled
with an interest), and as such attorney-in-fact
Beneficiary may, without the obligation to do
so, in Beneficiary's name, or in the name of
Grantor, prepare, execute and file or record
financing statements, continuation statements,
applications for registration and like papers
necessary to create, perfect or preserve any of
Beneficiary's security interests and rights in
or to any of the Collateral, and, upon a
Default hereunder, take any other action
required of Grantor; provided, however, that
Beneficiary as such attorney-in-fact shall be
accountable only for such funds as are actually
received by Beneficiary.
4.6 POSSESSION AND USE OF COLLATERAL. Except as
otherwise provided in this Article or in the
other Loan Documents, so long as no Default
exists under this Deed of Trust or any of the
Loan Documents, Grantor may possess, use, move,
transfer or dispose of any of the Collateral in
the ordinary course of Grantor's business and
in accordance with the Loan Agreement.
4.7 ASSIGNMENT OF EQUIPMENT LEASES. To secure the
payment and performance of the Secured
Obligations, Grantor (to the extent assignable) hereby
9
sells, assigns, grants, transfers and
sets over to Beneficiary all of Grantor's
right, title and interest in and to the
Equipment Leases relating to the Subject
Property and in and to the furniture, fixtures,
equipment and other items (herein called the
"Leased Equipment") and any rights to acquire
the Leased Equipment as set forth in the
Equipment Leases relating thereto, or
otherwise, and any and all extensions and
renewals thereof and any and all substitutions
therefor. Grantor will, from time to time,
execute upon request of the Beneficiary, any
and all reasonable instruments requested by
Beneficiary to carry this instrument into
effect. Grantor agrees to pay all sums when
due and promptly perform all covenants and
obligations required of the lessee under each
Equipment Lease, including, to the extent
required by the lessor under any Equipment
Lease, keeping the Leased Equipment in good
condition and repair, and making all necessary
replacements or renewals thereof. Beneficiary
shall not be responsible for or liable upon any
of the agreements, undertakings or obligations
imposed upon Grantor under any Equipment Lease,
including, but not limited to, the payment of
rent, until such time as Beneficiary takes
actual possession of the Leased Equipment and
the Subject Property. So long as there shall
exist no Default, Beneficiary shall not demand
from the lessor under any Equipment Lease any
rights of Grantor thereunder, nor shall
Beneficiary be entitled to the use and
possession of the Leased Equipment. Upon or at
any time after a Default, Grantor agrees to
turn over and give up possession of the Leased
Equipment to Beneficiary at the Subject
Property, and Beneficiary may without notice,
either in person or by agent, with or without
bringing any action or proceeding, or by a
receiver to be appointed by a court or to the
extent permitted under the terms of this Deed
of Trust, enter upon the Subject Property, take
possession of, manage and operate the Leased
Equipment, and in connection therewith: (x)
Beneficiary may make, cancel, enforce or modify
any Equipment Lease, repair, maintain and
improve the Leased Equipment, employ agents,
attorneys and accountants in connection with
the enforcement of Beneficiary's rights
hereunder and pay the reasonable fees and
expenses thereof, and otherwise do and perform
any and all acts and things which Beneficiary
may deem necessary or appropriate in the
protection of the Leased Equipment or the
enforcement of Beneficiary's rights hereunder
or under the Loan Agreement or any other Loan
Document; and any and all amounts expended by
Beneficiary in connection with the exercise of
any rights granted under this Section 4.7 shall
constitute additional Secured Obligations
secured by this Deed of Trust; (y) the entering
upon the Subject Property and taking possession
of the Leased Equipment and the exercise of any
of the rights hereinabove specified shall not
cure, waive, modify or affect any Default
hereunder or under the Loan Agreement or any
other Loan Document; and (z) Beneficiary may
acquire the Leased Equipment in accordance with
the provisions of any Equipment Lease. Except
as otherwise permitted hereunder and except for
amendments that do not result in an Equipment
Lease being less favorable to Grantor or
Beneficiary, Grantor shall keep each Equipment
Lease in full force and effect and will not
modify, change, alter, supplement or amend any
Equipment Lease. Grantor hereby warrants and
represents that, with respect to each of the
Equipment Leases, the execution and
10
delivery of this Deed of Trust (and the performance
of Grantor's obligations hereunder) do not cause
or create a default under any Equipment Lease,
a right to terminate any Equipment Lease or any
other event that after the giving of notice,
the passage of time or both could constitute a
default (or provide the lessor under an
Equipment Lease with a right to terminate). At
the request of Beneficiary, Grantor shall cause
this Deed of Trust to be served upon the lessor
under any Equipment Lease and shall use
reasonable efforts to cause such lessor to
acknowledge receipt of such notice. Without
limiting anything herein contained, this Deed
of Trust shall vest in Beneficiary a security
interest in each Equipment Lease and Grantor's
interest in the Leased Equipment (subject to
the ownership and security interest in the
Leased Equipment of lessor, as provided for in
the Equipment Lease). The Equipment Leases and
Leased Equipment shall constitute "Collateral"
hereunder.
4.8 ASSIGNMENT OF PERMITS. To secure the payment
and performance of the Secured Obligations,
Grantor hereby sells, assigns, grants,
transfers and sets over to Beneficiary all of
Grantor's right, title and interest in and to
all Required Permits now or hereafter in
effect, but only to the extent that the
Required Permits may be lawfully assigned; and
any and all substitutions therefor (and said
Required Permits shall constitute "Collateral"
hereunder). Grantor will, from time to time,
execute upon request of the Beneficiary, any
and all reasonable instruments requested by
Beneficiary to carry this instrument into
effect. Grantor agrees to pay all sums when
due under each Required Permit relating to the
Subject Property and promptly perform all
covenants and obligations required of the
licensee or permittee, as the case may be,
under each such Required Permit. Beneficiary
shall not be responsible for or liable upon any
of the agreements, undertakings or obligations
imposed upon Grantor under any Required Permit,
including, but not limited to, the payment of
fees, until such time as Beneficiary takes
actual possession of the Subject Property and
the Required Permits relating thereto. Upon or
at any time after a Default, Grantor agrees (to
the extent not prohibited by law) to turn over
and give up possession of the assignable
Required Permits relating to the Subject
Property, and Beneficiary may without notice,
either in person or by agent, with or without
bringing any action or proceeding, or by a
receiver to be appointed by a court or to the
extent permitted under the terms of this Deed
of Trust, enter upon the Subject Property, take
possession of, and manage and operate the
Subject Property; and in connection therewith:
(x) Beneficiary may make, cancel, enforce or
modify any Required Permit relating to the
Subject Property or cause the same to be issued
or reissued in its own name or the name of its
designee or operator of the Subject Property or
receiver, and otherwise do and perform any and
all acts and things which Beneficiary may deem
necessary or appropriate in the protection of
such Required Permits or the enforcement of
Beneficiary's rights hereunder or under the
Loan Agreement or any other Loan Document; and
any and all amounts expended by Beneficiary in
connection with the foregoing shall constitute
additional Secured Obligations secured by this
Deed of Trust; and (y) the entering upon the
Subject Property and
11
taking possession of the
same and the operation thereof under the
assignable Required Permits relating thereto,
and the exercise of any of the rights
hereinabove specified shall not cure, waive,
modify or affect any Default hereunder or under
the Loan Agreement or any other Loan Document.
Grantor shall keep each Required Permit
relating to the Subject Property in full force
and effect and will renew the same prior to
expiration and pay all fees in connection
therewith. Grantor hereby warrants and
represents that with respect to each Required
Permit relating to the Subject Property, the
execution and delivery of this Deed of Trust
(and the performance of Grantor's obligations
hereunder) do not cause or create (1) a default
with respect to any such Required Permit, (2) a
right to terminate or revoke any such Required
Permit or (3) any other event that after the
giving of notice, the passage of time or both
could constitute a default (or give rise to a
right to terminate). At the request of
Beneficiary, Grantor shall cause this Deed of
Trust to be served upon the issuer of each
assignable Required Permit relating to the
Subject Property and shall use its best efforts
to cause such issuer to acknowledge receipt of
such notice. Without limiting anything
contained herein, this Deed of Trust shall vest
in Beneficiary a security interest in each such
assignable Required Permit.
ARTICLE 5. RIGHTS AND DUTIES OF THE PARTIES
5.1 TITLE. Grantor represents and warrants that,
except as disclosed to Beneficiary in a writing
which refers to this warranty and except for
the Permitted Encumbrances, Grantor lawfully
holds and possesses fee simple title to the
Subject Property without limitation on the
right to encumber, and that this Deed of Trust
is a first and prior lien on the Subject
Property.
5.2 TAXES AND ASSESSMENTS. Subject to Section 7.3
of the Loan Agreement, Grantor shall pay prior
to delinquency, all taxes, assessments, levies
and charges imposed by any public or
quasi-public authority or utility company which
are or which may become a lien upon or cause a
loss in value of the Subject Property or any
interest therein. Grantor shall also pay prior
to delinquency all taxes, assessments, levies
and charges imposed by any public authority
upon Beneficiary by reason of its interest in
any Secured Obligation or in the Subject
Property, or by reason of any payment made to
Beneficiary pursuant to any Secured Obligation;
provided, however, Grantor shall have no
obligation to pay taxes which may be imposed
from time to time upon Beneficiary and which
are measured by and imposed upon Beneficiary's
capital or net income.
5.3 TAX AND INSURANCE IMPOUNDS. At Beneficiary's
election and demand, Grantor shall, until all
Secured Obligations have been paid in full, pay
to Beneficiary monthly, annually or as
otherwise directed by Beneficiary an amount
estimated by Beneficiary to be equal to: (i)
all taxes, assessments and levies imposed by
any public or quasi-public authority or utility
company which are or
12
may become a lien upon the
Subject Property and will become due for the
tax year during which such payment is so
directed; and (ii) premiums for fire and other
hazard insurance next due. If Beneficiary
determines that any amounts paid by Grantor are
insufficient for the payment in full of such
taxes, assessments, levies and/or insurance
premiums, Beneficiary shall notify Grantor of
the increased amounts required to pay all
amounts due, whereupon Grantor shall pay to
Beneficiary within thirty (30) days thereafter
the additional amount as stated in
Beneficiary's notice. All sums so paid shall
earn interest at the rate then paid on current
market rate accounts maintained with
Beneficiary. The funds deposited with
Beneficiary may be commingled by Beneficiary
with its general funds. Beneficiary shall,
unless Grantor is otherwise in Default
hereunder or under any Secured Obligation,
apply said funds to the payment of, or at the
sole option of Beneficiary release said funds
to Grantor for the application to and payment
of, such sums, taxes, assessments, levies,
charges, and insurance premiums. Upon Default
by Grantor hereunder or under any Secured
Obligation, Beneficiary may apply all or any
part of said sums to any Secured Obligation
and/or to cure such Default, in which event
Grantor shall be required to restore all
amounts so applied, as well as to cure any
other events or conditions of Default not cured
by such application. Upon assignment of this
Deed of Trust, Beneficiary shall have the right
to assign all amounts collected and in its
possession to its assignee whereupon
Beneficiary shall be released from all
liability with respect thereto. Within ninety-five
(95) days following full repayment of the
Secured Obligations (other than full repayment
of the Secured Obligations as a consequence of
a foreclosure or conveyance in lieu of
foreclosure of the liens and security interests
securing the Secured Obligations) or at such
earlier time as Beneficiary may elect, the
balance of all amounts collected and in
Beneficiary's possession shall be paid to
Grantor and no other party shall have any right
or claim thereto.
5.4 PERFORMANCE OF SECURED OBLIGATIONS. Grantor
shall promptly pay and perform each Secured
Obligation when due.
5.5 LIENS, ENCUMBRANCES AND CHARGES. Subject to
Section 7.3 of the Loan Agreement, Grantor
shall immediately discharge any lien not
approved by Beneficiary in writing that has or
may attain priority over this Deed of Trust.
Subject to Section 7.3 of the Loan Agreement,
Grantor shall pay when due all obligations
secured by or reducible to liens and
encumbrances which shall now or hereafter
encumber or appear to encumber all or any part
of the Subject Property or any interest
therein, whether senior or subordinate hereto.
5.6 DAMAGES; INSURANCE AND CONDEMNATION PROCEEDS.
All insurance and condemnation proceeds shall
be paid and applied in accordance with the
terms contained in the Loan Agreement.
5.7 MAINTENANCE AND PRESERVATION OF THE SUBJECT
PROPERTY. Subject to the provisions of the
Loan Agreement, Grantor covenants:
13
(a) to maintain the insurance provided for in
the Loan Agreement, and to comply with the
requirements of any insurance companies
insuring the Subject Property; provided,
however, neither Beneficiary nor Trustee,
by reason of accepting, rejecting,
approving or obtaining insurance shall
incur any liability for (x) the existence,
nonexistence, form or legal sufficiency of
any insurance, (y) the solvency of any
insurer, or (z) the payment of claims;
(b) to keep the Subject Property in good
condition and repair, reasonable wear and
tear excepted;
(c) except as otherwise permitted under the
Loan Documents, not to remove or demolish
the Subject Property or any part thereof,
not to alter, restore or add to the
Subject Property and not to initiate or
acquiesce in any change in any zoning or
other land classification which affects
the Subject Property without Beneficiary's
prior written consent (which consent shall
not be unreasonably withheld or delayed);
(d) to complete or restore promptly and in
good and workmanlike manner the Subject
Property, or any part thereof which may be
damaged or destroyed, without regard to
whether Beneficiary elects to require that
insurance proceeds be used to reduce the
Secured Obligations as provided in the
Loan Agreement;
(e) to comply with all laws, ordinances,
regulations and standards, and all
covenants, conditions, restrictions and
equitable servitudes, whether public or
private, of every kind and character which
affect the Subject Property and pertain to
acts committed or conditions existing
thereon, including, without limitation,
any work, alteration, improvement or
demolition mandated by such laws,
covenants or requirements;
(f) not to commit or permit waste of the
Subject Property; and
(g) to do all other acts which from the
character or use of the Subject Property
may be necessary to maintain and preserve
its value.
5.8 DEFENSE AND NOTICE OF LOSSES, CLAIMS AND
ACTIONS. At Grantor's sole expense, Grantor
shall protect, preserve and defend the Subject
Property and title to and right of possession
of the Subject Property, the security hereof
and the rights and powers of Beneficiary and
Trustee hereunder against all adverse claims.
5.9 ACCEPTANCE OF TRUST; POWERS AND DUTIES OF
TRUSTEE. Trustee accepts this trust when this
Deed of Trust is recorded. From time to time
upon written request of Beneficiary and presen-
tation of this Deed of Trust or a
14
certified copy thereof for endorsement, and without
affecting the personal liability of any person
for payment of any indebtedness or performance
of any obligations secured hereby, Trustee may,
without liability therefor and without notice:
(i) release all or any part of the Subject
Property from the lien of this Deed of Trust;
(ii) consent to the making of any map or plat
thereof; and (iii) join in any grant of
easement thereon, any declaration of covenants
and restrictions, or any extension agreement or
any agreement subordinating the lien or charge
of this Deed of Trust. Except as may be
required by applicable law, Trustee or
Beneficiary may from time to time apply to any
court of competent jurisdiction for aid and
direction in the execution of the trust
hereunder and the enforcement of the rights and
remedies available hereunder, and may obtain
orders or decrees directing or confirming or
approving acts in the execution of said trust
and the enforcement of said remedies. Trustee
has no obligation to notify any party of any
pending sale or any action or proceeding,
including, without limitation, actions in which
Grantor, Beneficiary or Trustee shall be a
party unless held or commenced and maintained
by Trustee under this Deed of Trust. Trustee
shall not be obligated to perform any act
required of it hereunder unless the performance
of the act is requested in writing and Trustee
is reasonably indemnified and held harmless
against loss, cost, liability or expense.
5.10 COMPENSATION; EXCULPATION; INDEMNIFICATION.
(a) Grantor shall pay Trustee's fees and
reimburse Trustee and Beneficiary for
expenses in the administration of this
trust, including attorneys' fees.
Beneficiary shall not directly or
indirectly be liable to Grantor or any
other person as a consequence of (i) the
exercise of the rights, remedies or powers
granted to Beneficiary in this Deed of
Trust (unless the loss is caused by the
gross negligence or willful misconduct of
Beneficiary); (ii) the failure or refusal
of Beneficiary to perform or discharge any
obligation or liability of Grantor under
any agreement related to the Subject
Property or under this Deed of Trust; or
(iii) any loss sustained by Grantor or any
third party resulting from Beneficiary's
failure to lease the Subject Property
after a Default or from any other act or
omission of Beneficiary in managing the
Subject Property after a Default (unless
the loss is caused by the gross negligence
or willful misconduct of Beneficiary) and
no such liability shall be asserted
against or imposed upon Beneficiary, and
all such liability is hereby expressly
waived and released by Grantor.
(b) Grantor indemnifies Trustee and
Beneficiary against, and holds Trustee and
Beneficiary harmless from, all losses,
damages, liabilities, claims, causes of
action, judgments, court costs, reasonable
attorneys' fees and other legal expenses,
cost of evidence of title, cost of
evidence of value, and other expenses
which either may suffer or incur: (i) by
reason of this Deed of Trust; (ii) by
reason of the execution of this trust or
in performance of any act required or
permitted hereunder or by law; (iii) as a
result of any failure
15
of Grantor to perform Grantor's obligations
hereunder or under any other Loan Documents; or
(iv) by reason of any alleged obligation or
undertaking on Beneficiary's part to
perform or discharge any of the
representations, warranties, conditions,
covenants or other obligations contained
in any other document related to the
Subject Property. The above obligation of
Grantor to indemnify and hold harmless
Trustee and Beneficiary shall survive the
release and cancellation of the Secured
Obligations and the release and
reconveyance or partial release and
reconveyance of this Deed of Trust.
(c) Grantor shall pay all amounts and
indebtedness arising under this Section
5.10 immediately upon demand by Trustee or
Beneficiary together with interest thereon
from the date the indebtedness arises at
the rate of interest then applicable to
the principal balance of the Note as
specified therein.
5.11 PROHIBITION OF TRANSFER OF SUBJECT
PROPERTY OR INTERESTS IN Grantor. Grantor
acknowledges that Beneficiary has relied
upon the principals of Grantor and Co-Borrower and
their experience in owning
and operating properties similar to the
Subject Property in connection with the
closing of the Loan. Accordingly, except
with the prior written consent of
Beneficiary or as otherwise expressly
permitted in the Note, Grantor shall not
cause or permit any sale, exchange,
mortgage, pledge, hypothecation,
assignment, encumbrance or other transfer,
conveyance or disposition, whether
voluntarily, involuntarily, conditionally,
unconditionally or by operation of law
("Transfer") of all or any part of, or all
or any direct or indirect interest in, the
Subject Property or the Collateral (except
for equipment and inventory in the
ordinary course of its business), or cause
or permit a Transfer of any direct or
indirect interest (whether general or
limited partnership interest, stock,
limited liability company interest, trust,
or otherwise) in Grantor or Co-Borrower.
In the event of any Transfer that is not
expressly permitted in the Note and is
without the prior written consent of
Beneficiary, Beneficiary shall have the
absolute right at its option, without
prior demand or notice, to declare all of
the Secured Obligations immediately due
and payable, except to the extent
prohibited by law, and pursue its rights
and remedies under Section 6.2 herein.
Grantor agrees to pay any prepayment fee
as set forth in the Note in the event the
Secured Obligations are accelerated
pursuant to the terms of this Section.
Consent to one such Transfer shall not be
deemed to be a waiver of the right to
require the consent to future or
successive Transfers.
5.12 RELEASES, EXTENSIONS, MODIFICATIONS AND
ADDITIONAL SECURITY. Without notice to or
the consent, approval or agreement of any
persons or entities having any interest at
any time in the Subject Property or in any
manner obligated under the Secured
Obligations ("Interested Parties"),
Beneficiary may, from time to time,
release any person or entity from
liability for the payment or performance
of any Secured Obligation, take any action
or make any agreement
16
extending the maturity or otherwise altering
the terms or increasing the amount of any Secured
Obligation, or accept additional security
or release all or a portion of the Subject
Property and other security for the
Secured Obligations. None of the
foregoing actions shall release or reduce
the personal liability of any of said
Interested Parties, or release or impair
the priority of the lien of this Deed of
Trust upon the Subject Property.
5.13 RECONVEYANCE. Upon Beneficiary's written
request, and upon surrender to Trustee for
cancellation of this Deed of Trust or a
certified copy thereof, Trustee shall
reconvey or release, without warranty, the
Subject Property or that portion thereof
then held hereunder. To the extent
permitted by law, the reconveyance or
release may describe the grantee as "the
person or persons legally entitled
thereto" and the recitals of any matters
or facts in any reconveyance or release
executed hereunder shall be conclusive
proof of the truthfulness thereof.
Neither Beneficiary nor Trustee shall have
any duty to determine the rights of
persons claiming to be rightful grantees
of any reconveyance or release. When the
Subject Property has been fully reconveyed
or released, the last such reconveyance or
release shall operate as a reassignment of
all future rents, issues and profits of
the Subject Property to the person or
persons legally entitled thereto.
5.14 SUBROGATION. Beneficiary shall be
subrogated to the lien of all
encumbrances, whether released of record
or not, paid in whole or in part by
Beneficiary pursuant to this Deed of Trust
or by the proceeds of any loan secured by
this Deed of Trust.
5.15 RIGHT OF INSPECTION. Beneficiary, its
agents and employees, may enter the
Subject Property at any reasonable time,
upon reasonable advance notice, for the
purpose of inspecting the Subject Property
and ascertaining Grantor's compliance with
the terms hereof.
5.16 SUBSTITUTION OF TRUSTEES. From time to
time, by a writing, signed and
acknowledged by Beneficiary and recorded
in the Land Records of the County in which
the Subject Property is situated,
Beneficiary may appoint another trustee to
act in the place and stead of Trustee or
any successor. Such writing shall set
forth any information required by law.
The recordation of such instrument of
substitution shall discharge Trustee
herein named and shall appoint the new
trustee as the trustee hereunder with the
same effect as if originally named Trustee
herein. A writing recorded pursuant to
the provisions of this Section 5.16 shall
be conclusive proof of the proper substi-
tution of such new Trustee.
5.17 HAZARDOUS MATERIALS. Without limiting any
other provision of this Deed of Trust,
Grantor agrees as follows:
(a) Prohibited Activities. Grantor shall not
cause or permit the Subject Property to be
used as a site for the use, generation,
manufacture, storage,
17
treatment, release, discharge, disposal,
transportation or presence of any Hazardous Materials.
The foregoing to the contrary notwithstanding:
(i) Grantor may store, maintain and use on
the Subject Property janitorial and
maintenance supplies, paint and other
Hazardous Materials of a type and in a
quantity readily available for purchase by
the general public and normally stored,
maintained and used by owners and managers
of properties of a type similar to the
Subject Property; and (ii) tenants of the
Subject Property may store, maintain and
use on the Subject Property (and, if any
tenant is a retail business, hold in
inventory and sell in the ordinary course
of such tenant's business) Hazardous
Materials of a type and quantity readily
available for purchase by the general
public and normally stored, maintained and
used (and, if tenant is a retail business,
sold) by tenants in similar lines of
business on properties similar to the
Subject Property.
(b) Hazardous Materials Laws. Grantor shall
comply and cause the Subject Property to
comply with all Hazardous Materials Laws.
(c) Notices. Grantor shall immediately notify
Beneficiary in writing of: (i) the
discovery of any Hazardous Materials on,
under or about the Subject Property (other
than Hazardous Materials permitted under
Section 6.2 (a)); (ii) any knowledge by
Grantor that the Subject Property does not
comply with any Hazardous Materials Laws;
and (iii) any Hazardous Materials Claims
pending or threatened against Grantor or
the Subject Property by any governmental
entity or agency or any other person or
entity relating to Hazardous Materials or
pursuant to the Hazardous Materials Laws.
(d) Remedial Action. In response to the
presence of any Hazardous Materials on,
under or about the Subject Property,
Grantor shall immediately take, at
Grantor's sole expense, all remedial
action required by any Hazardous Materials
Laws or any judgment, consent decree,
settlement or compromise in respect to any
Hazardous Materials Claims.
(e) Inspection By Beneficiary. Upon
reasonable prior notice to Grantor,
Beneficiary, its employees and agents, may
from time to time (whether before or after
the commencement of a nonjudicial or
judicial foreclosure proceeding), enter
and inspect the Subject Property for the
purpose of determining the existence,
location, nature and magnitude of any past
or present release or threatened release
of any Hazardous Materials into, onto,
beneath or from the Subject Property.
ARTICLE 6. DEFAULT PROVISIONS
6.1 DEFAULT. For all purposes hereof, the term
"Default" shall mean the existence of any
Default as defined in the Loan Agreement.
18
6.2 RIGHTS AND REMEDIES. At any time after
Default, Beneficiary and Trustee shall each
have all the following rights and remedies (in
addition to (and without limiting) any rights
and remedies that are available under
applicable law):
(a) With or without prior notice, to declare
all Secured Obligations immediately due
and payable;
(b) With or without notice, and without
releasing Grantor from any Secured
Obligation, and without becoming a
mortgagee in possession, to enter upon the
Subject Property from time to time and to
do such acts and things as Beneficiary or
Trustee deem necessary or desirable in
order to inspect, investigate, assess and
protect the security hereof or to cure any
Default, including, without limitation:
(i) to appear in and defend any action or
proceeding purporting to affect the
security of this Deed of Trust or the
rights or powers of Beneficiary or Trustee
under this Deed of Trust; (ii) to pay,
purchase, contest or compromise any encum-
brance, charge, lien or claim of lien
which, in the sole judgment of either
Beneficiary or Trustee, is or may be
senior in priority to this Deed of Trust,
the judgment of Beneficiary or Trustee
being conclusive as between the parties
hereto; (iii) to obtain insurance; (iv) to
pay any premiums or charges with respect
to insurance required to be carried under
the Loan Documents; and (v) to employ
legal counsel, accountants, engineers,
consultants, contractors and other
appropriate persons to assist them;
(c) To commence and maintain an action or
actions in any court of competent
jurisdiction to foreclose this instrument
as a mortgage or to obtain specific
enforcement of the covenants of Grantor
hereunder, and Grantor agrees that such
covenants shall be specifically
enforceable by injunction or any other
appropriate equitable remedy and that for
the purposes of any suit brought under
this subparagraph, Grantor waives the
defense of laches and any applicable
statute of limitations. Grantor hereby,
upon the occurrence of a Default, (i)
declares its assent to the passing of a
decree for the sale of any or all of the
Subject Property or any estate or interest
therein in and by any equity court having
jurisdiction over the sale of the Subject
Property, and (ii) authorizes and empowers
the Beneficiary or such other person or
entity designated by Beneficiary to take
possession of any or all of the Subject
Property and to sell any or all of it or
any estate or interest therein in
accordance with the provisions of Rules
W70 and W77 of the Maryland Rules of
Procedure, as amended, and Section 7-105
of the Real Property Article of the
Annotated Code of Maryland (1988 Edition,
as amended), and/or any other applicable
general or local law, rule or regulation
of the United States of America or the
State of Maryland relating to or affecting
deeds of trust or security agreements,
including any amendments thereof or
additions thereto. Neither the foregoing
assent to decree nor the foregoing
19
power of sale shall be exhausted in the event
that such proceeding or sale is dismissed
or canceled before the secured debt is
paid in full. In the event of a sale of
the Subject Property under either the
power of sale or assent to decree, such
sale may be made, at the option of
Beneficiary, subject to one or more of the
tenancies entered into subsequent to the
recording of this Deed of Trust, in
accordance with the provisions of Section
7-105(f)(2) of the Real Property Article
of the Annotated Code of Maryland, as
amended.
(d) To apply to a court of competent
jurisdiction for and obtain appointment of
a receiver of the Subject Property as a
matter of strict right, ex parte and
without notice to Grantor (Grantor hereby
waiving any notice), and without regard to
the adequacy of the security for the
Secured Obligations, the existence of a
declaration that the Secured Obligations
are immediately due and payable, the
filing of a notice of default, or the
commencement of any foreclosure, and
Grantor hereby consents to such
appointment. Such receiver shall have the
right to take possession of and protect
the Subject Property and operate the same
and collect the rents, issues, profits,
revenues and Payments therefrom, which
receiver shall have the right to remain in
possession of the Subject Property
thereafter, during the pendency of any
foreclosure proceeding and all redemption
periods until the issuance of a Trustee's
deed. All expenses and costs incurred by
the receiver or its agents shall
constitute a part of the Secured
Obligations;
(e) To enter upon, possess, manage and operate
the Subject Property or any part thereof,
to take and possess all documents, books,
records, papers and accounts of Grantor or
the then owner of the Subject Property, to
make, terminate, enforce or modify Leases
of the Subject Property upon such terms
and conditions as Beneficiary deems
proper, to make repairs, alterations and
improvements to the Subject Property as
necessary, in Trustee's or Beneficiary's
sole judgment, all to protect or enhance
the security hereof;
(f) To execute a written notice of such
Default and of its election to cause the
Subject Property to be sold to satisfy the
Secured Obligations. As a condition
precedent to any such sale, Trustee and/or
Beneficiary shall give and record such
notices as the law then requires. When
the minimum period of time required after
such notices has elapsed, Trustee, without
notice to or demand upon Grantor, except
as required by law, shall sell the Subject
Property at the time and place of sale
fixed by it in the notice of sale, at one
or several sales, either as a whole or in
separate parcels and in such manner and
order, all as Beneficiary in its sole
discretion may determine, at public
auction to the highest bidder for cash, in
lawful money of the United States, payable
at time of sale. Neither Grantor nor any
other person or entity other than
Beneficiary shall have the right to direct
the order in which the Subject Property is
sold. Subject to requirements and
20
limits imposed by law, Trustee may from time to
time postpone sale of all or any portion
of the Subject Property by public
announcement at such time and place of
sale. Trustee shall deliver to the pur-
chaser at such sale a deed conveying the
Subject Property or portion thereof so
sold, but without any covenant or
warranty, express or implied. The
recitals in the deed of any matters or
facts shall be conclusive proof of the
truthfulness thereof. Any person (other
than Trustee), including Grantor or
Beneficiary may purchase at the sale;
(g) To resort to and realize upon the security
hereunder and any other security now or
later held by Beneficiary concurrently or
successively and in one or several
consolidated or independent judicial
actions or lawfully taken non-judicial
proceedings, or both, and to apply the
proceeds received upon the Secured Obliga-
tions all in such order and manner as
Trustee and Beneficiary, or either of
them, determine in their sole discretion.
6.3 APPLICATION OF FORECLOSURE SALE PROCEEDS.
After deducting all costs, fees and expenses of
Trustee, and of this trust (including, without
limitation, the payment of the Trustee's fees
and attorneys' fees, the cost of evidence of
title in connection with sale and costs and
expenses of sale and of any judicial proceeding
wherein such sale may be made), Trustee,
subject to applicable law, shall apply all
proceeds of any foreclosure sale: (i) to
discharge all taxes, levies and assessments,
with costs and interest if they have priority
over the lien of this Deed of Trust, including
the pro rata portion thereof due for the
current year; (ii) to payment of all sums
expended by Beneficiary under the terms hereof
and not then repaid, with accrued interest at
the rate of interest specified in the Note to
be applicable on or after maturity or
acceleration of the Note; (iii) to payment of
all other Secured Obligations; and (iv) the
remainder, if any, to Grantor or Grantor's
assigns.
6.4 ORDER OF APPLICATION OF PROCEEDS. All sums
received by Beneficiary under Section 6.2
(subject to Section 6.3) or Section 3.2, less
all costs and expenses incurred by Beneficiary
or any receiver under Section 6.2 or
Section 3.2, including, without limitation,
attorneys' fees, shall be applied in payment of
the Secured Obligations in such order as
Beneficiary shall determine in its sole
discretion; provided, however, Beneficiary
shall have no liability for funds not actually
received by Beneficiary.
6.5 NO CURE OR WAIVER. Neither Beneficiary's nor
Trustee's nor any receiver's entry upon and
taking possession of all or any part of the
Subject Property, nor any collection of rents,
issues, profits, insurance proceeds,
condemnation proceeds or damages, other
security or proceeds of other security, or
other sums, nor the application of any
collected sum to any Secured Obligation, nor
the exercise or failure to exercise of any
other right or remedy by Beneficiary or Trustee
or any receiver shall cure or waive any breach,
Default or notice of default under this
21
Deed of Trust, or nullify the effect of any notice of
default or sale (unless all Secured Obligations
then due have been paid and performed and
Grantor has cured all other defaults), or
impair the status of the security, or prejudice
Beneficiary or Trustee in the exercise of any
right or remedy, or be construed as an
affirmation by Beneficiary of any tenancy,
lease or option or a subordination of the lien
of this Deed of Trust.
6.6 PAYMENT OF COSTS, EXPENSES AND ATTORNEY'S FEES.
Grantor agrees to pay to Beneficiary
immediately and without demand all reasonable
costs and expenses incurred by Trustee and
Beneficiary in connection with the exercise of
the rights and remedies provided for herein
and/or in any of the other Loan Documents
(including, without limitation, court costs,
appraisal fees and reasonable attorneys' fees,
whether incurred in litigation or not) with
interest from the date of expenditure until
said sums have been paid at the rate of
interest then applicable to the principal
balance of the Note as specified therein. In
addition, Grantor shall pay to Trustee and/or
Beneficiary all Trustee's fees hereunder and
shall reimburse Trustee for all reasonable
expenses incurred in the administration of this
trust, including, without limitation, any
attorneys' fees.
6.7 POWER TO FILE NOTICES AND CURE DEFAULTS.
Grantor hereby irrevocably appoints Beneficiary
and its successors and assigns, as its
attorney-in-fact, which agency is coupled with
an interest, (a) to execute and/or record any
notices of completion, cessation of labor, or
any other notices that Beneficiary deems
appropriate to protect Beneficiary's interest,
(b) upon the issuance of a deed pursuant to the
foreclosure of this Deed of Trust or the
delivery of a deed in lieu of foreclosure, to
execute all instruments of assignment or
further assurance with respect to the Leases
and Payments in favor of the grantee of any
such deed, as may be necessary or desirable for
such purpose, (c) to prepare, execute and file
or record financing statements, continuation
statements, applications for registration and
like papers necessary to create, perfect or
preserve Beneficiary's security interests and
rights in or to any of the Collateral and any
other property or interests securing the
payment and the performance of the Secured
Obligations, and (d) upon the occurrence of a
Default, Beneficiary may perform any obligation
of Grantor hereunder; provided, however, that:
(i) Beneficiary as such attorney-in-fact shall
only be accountable for such funds as are
actually received by Beneficiary; and (ii)
Beneficiary shall not be liable to Grantor or
any other person or entity for any failure to
act under this Section.
6.8 REMEDIES CUMULATIVE. All rights and remedies
of Beneficiary and Trustee provided hereunder
are cumulative and are in addition to all
rights and remedies provided by applicable law
(including specifically that of foreclosure of
this instrument as though it were a mortgage)
or in any other agreements between Grantor and
Beneficiary. Beneficiary may enforce any one
or more remedies or rights hereunder
successively or concurrently.
22
ARTICLE 7. MISCELLANEOUS PROVISIONS
7.1 ADDITIONAL PROVISIONS. The Loan Documents
contain or incorporate by reference the entire
agreement of the parties with respect to
matters contemplated herein and supersede all
prior negotiations. The Loan Documents grant
further rights to Beneficiary and contain
further agreements and affirmative and negative
covenants by Grantor which apply to this Deed
of Trust and to the Subject Property and such
further rights and agreements are incorporated
herein by this reference.
7.2 MERGER. No merger shall occur as a result of
Beneficiary's acquiring any other estate in, or
any other lien on, the Subject Property unless
Beneficiary consents to a merger in writing.
7.3 WAIVER OF MARSHALLING RIGHTS. Grantor, for
itself and for all parties claiming through or
under Grantor, and for all parties who may
acquire a lien on or interest in the Subject
Property, hereby waives all rights to have the
Subject Property and/or any other property,
including, without limitation, the Collateral,
which is now or later may be security for any
Secured Obligation ("Other Property")
marshalled upon any foreclosure of this Deed of
Trust or on a foreclosure of any Other
Property. Beneficiary shall have the right to
sell, and any court in which foreclosure pro-
ceedings may be brought shall have the right to
order a sale of, the Subject Property and any
or all of the Collateral or Other Property as a
whole or in separate parcels, in any order that
Beneficiary may designate.
7.4 WAIVER OF RIGHTS OF REDEMPTION AND
REINSTATEMENT. To the fullest extent permitted
by applicable law, Grantor, for itself and for
all parties claiming through or under Grantor,
and for all parties who may acquire a lien on
or interest in the Subject Property, hereby
waives any and all rights of redemption and
reinstatement under law and under any order or
decree of foreclosure of this Deed of Trust,
and all such rights of redemption and
reinstatement of Grantor and of all other
persons, are and shall be deemed to be hereby
waived to the full extent permitted by the
provisions of the applicable law.
7.5 EXERCISE OF REMEDIES. Notwithstanding any of
the terms or provisions contained in this Deed
of Trust (or in any of the other Loan
Documents), if at any time after the occurrence
of a Default under any of the Loan Documents
(but prior to the time (if any) that said
Default has been cured to the satisfaction of
Beneficiary), Beneficiary has commenced to
exercise one or more of its remedies provided
for herein (or provided in any of the other
Loan Documents or available at law or in
equity), Beneficiary will not be precluded from
continuing to exercise all of its rights and
remedies upon said Default (notwithstanding the
fact that Grantor may have cured, attempted to
cure or be in the process of curing said
23
Default). It is the intention of the parties
hereto that (to the extent permitted by law)
once Beneficiary has commenced to exercise one
or more of its rights or remedies (upon a
Default), said Default cannot be cured, unless
Beneficiary expressly agrees in writing to
accept said cure and to cease the exercise of
said rights and remedies.
7.6 RULES OF CONSTRUCTION. The term "Subject
Property" means all and any part of the Subject
Property and any interest in the Subject
Property.
7.7 SUCCESSORS IN INTEREST. The terms, covenants,
and conditions herein contained shall be
binding upon and inure to the benefit of the
successors and assigns of the parties hereto;
provided, however, that this section does not
waive or modify any restrictions on transfer
contained herein or in any of the other Loan
Documents.
7.8 GOVERNING LAW. This Deed of Trust shall be
governed by and construed in accordance with
the laws of the State of Maryland.
7.9 INCORPORATION. Exhibit A, as attached, is
incorporated into this Deed of Trust by this
reference.
7.10 NOTICES. All notices, reports, demands,
requests and other communications
authorized or required under this Deed of
Trust to be given to Grantor or
Beneficiary, shall be given in the manner
and to the addresses specified in the Loan
Agreement for the giving of notices.
Grantor shall forward to Beneficiary,
without delay, any notices, letters or
other communications delivered to the
Subject Property or to Grantor naming
Beneficiary, "Lender" or any similar
designation as addressee, or which could
reasonably be deemed to affect the ability
of Grantor to perform its obligations to
Beneficiary under the Note, the Loan
Agreement or any other Loan Documents.
7.11 LIMITATION OF LIABILITY. The limitations
on liability set forth in Section 2.8 of
the Loan Agreement shall apply with equal
force to this Deed of Trust, and said
limitations are incorporated herein by
reference as fully and with the same
effect as if recited herein at length.
7.12 SEVERABILITY. If any provision or
obligation under this Deed of Trust shall
be determined by a court of competent
jurisdiction to be invalid, illegal or
unenforceable, that provision shall be
deemed severed from the Deed of Trust and
the validity, legality and enforceability
of the remaining provisions or obligations
shall remain in full force as though the
invalid, illegal or unenforceable
provision had never been a part of the
Deed of Trust.
7.13 TIME. Time is of the essence of each and
every term of this Deed of Trust.
24
7.14 RELATIONSHIP. The relationship of Grantor
and Beneficiary under this Deed of Trust
and the other Loan Documents is, and shall
at all times remain, solely that of
borrower and lender; and Beneficiary
neither undertakes nor assumes any
responsibility or duty to Grantor or to
any third party with respect to the
Subject Property. Notwithstanding any
other provisions of this Deed of Trust and
the other Loan Documents: (i) Beneficiary
is not, and shall not be construed to be,
a partner, joint venturer, member, alter
ego, manager, controlling person or other
business associate or participant of any
kind of Grantor, and Beneficiary does not
intend to ever assume such status; (ii)
Beneficiary does not intend to ever assume
any responsibility to any person for the
quality, suitability, safety or condition
of the Subject Property; and (iii)
Beneficiary shall not be deemed
responsible for or a participant in any
acts, omissions or decisions of Grantor.
7.15 COMMERCIAL LOANS. Grantor warrants and
represents that the liabilities secured by
this Deed of Trust are "commercial loans"
within the meaning of the Commercial Law
Article of the Annotated Code of Maryland.
7.16 EXECUTION IN COUNTERPARTS. This Deed of
Trust may be executed in any number of
counterparts, each of which when executed
and delivered shall be deemed to be an
original and all such counterparts
together, shall constitute one and the
same instrument.
25
IN WITNESS WHEREOF, Grantor, Trustee and Beneficiary
has executed this Deed of Trust as of the day and year
set forth above.
"Grantor"
MONTROSE OFFICE PARK JOINT VENTURE, a Maryland joint venture
By: Prudential-Bache/Equitec Real Estate Partnership, a
California limited partnership, its joint venturer
By: Prudential-Bache Properties, Inc., a Delaware
corporation, its general partner
By: /s/ C. A. Xxxxxxxxxxx
-------------------------
Its: Vice President
-------------------------
By: Glenborough Corporation, a California
corporation, its general partner
By: /s/ Xxxxxx Xxxxxxxxxx
-------------------------
Its: Chairman/CEO
-------------------------
By: /s/ Xxxxxx Xxxxxxxxxx
-----------------------------
Xxxxxx Xxxxxxxxxx, its general partner
By: Montrose Office Park Limited Partnership, a
Maryland limited partnership, its joint venturer
By: Prudential-Bache/Equitec Real Estate
Partnership, a California limited partnership,
its general partner
By: Prudential-Bache Properties, Inc., a
Delaware corporation, its general partner
By: /s/ C. A. Xxxxxxxxxxx
-------------------------
Its: Vice President
-------------------------
By: Glenborough Corporation, a California
corporation, its general partner
By: /s/ Xxxxxx Xxxxxxxxxx
-------------------------
Its: Chairman/CEO
By: /s/ Xxxxxx Xxxxxxxxxx
-----------------------------
Xxxxxx Xxxxxxxxxx, its general partner
"TRUSTEE"
CHICAGO TITLE INSURANCE COMPANY, a Missouri corporation
By:__________________________
Its:_________________________
"BENEFICIARY"
XXXXX FARGO BANK, NATIONAL ASSOCIATION
By: /s/ Xxxxx X. Xxxxx
--------------------------
Its: SVP
--------------------------
STATE OF_________________)
) SS
COUNTY OF________________)
On _______________, 1996, before me,
____________________________, a Notary Public in and
for the County and State aforesaid, personally appeared
_________________________, personally known to me (or
proved to me on the basis of satisfactory evidence) to
be the same person whose name is subscribed to the
within and acknowledged to me that _____ executed the
same in _____ authorized capacity, and that by _____
signature on the instrument the person or the entity
upon behalf of which the person acted, executed the
instrument.
WITNESS my hand and official.
_________________________________
Notary Public
My Commission Expires:
_____________________________
STATE OF_________________)
) SS
COUNTY OF________________)
On _______________, 1996, before me,
____________________________, a Notary Public in and
for the County and State aforesaid, personally appeared
_________________________, personally known to me (or
proved to me on the basis of satisfactory evidence) to
be the same person whose name is subscribed to the
within and acknowledged to me that _____ executed the
same in _____ authorized capacity, and that by _____
signature on the instrument the person or the entity
upon behalf of which the person acted, executed the
instrument.
WITNESS my hand and official.
_________________________________
Notary Public
My Commission Expires:
_____________________________
STATE OF_________________)
) SS
COUNTY OF________________)
On _______________, 1996, before me,
____________________________, a Notary Public in and
for the County and State aforesaid, personally appeared
_________________________, personally known to me (or
proved to me on the basis of satisfactory evidence) to
be the same person whose name is subscribed to the
within and acknowledged to me that _____ executed the
same in _____ authorized capacity, and that by _____
signature on the instrument the person or the entity
upon behalf of which the person acted, executed the
instrument.
WITNESS my hand and official.
_________________________________
Notary Public
My Commission Expires:
_____________________________
STATE OF_________________)
) SS
COUNTY OF________________)
On _______________, 1996, before me,
____________________________, a Notary Public in and
for the County and State aforesaid, personally appeared
_________________________, personally known to me (or
proved to me on the basis of satisfactory evidence) to
be the same person whose name is subscribed to the
within and acknowledged to me that _____ executed the
same in _____ authorized capacity, and that by _____
signature on the instrument the person or the entity
upon behalf of which the person acted, executed the
instrument.
WITNESS my hand and official.
_________________________________
Notary Public
My Commission Expires:
_____________________________
STATE OF_________________)
) SS
COUNTY OF________________)
On _______________, 1996, before me,
____________________________, a Notary Public in and
for the County and State aforesaid, personally appeared
_________________________, personally known to me (or
proved to me on the basis of satisfactory evidence) to
be the same person whose name is subscribed to the
within and acknowledged to me that _____ executed the
same in _____ authorized capacity, and that by _____
signature on the instrument the person or the entity
upon behalf of which the person acted, executed the
instrument.
WITNESS my hand and official.
_________________________________
Notary Public
My Commission Expires:
_____________________________
STATE OF_________________)
) SS
COUNTY OF________________)
On _______________, 1996, before me,
____________________________, a Notary Public in and
for the County and State aforesaid, personally appeared
_________________________, personally known to me (or
proved to me on the basis of satisfactory evidence) to
be the same person whose name is subscribed to the
within and acknowledged to me that _____ executed the
same in _____ authorized capacity, and that by _____
signature on the instrument the person or the entity
upon behalf of which the person acted, executed the
instrument.
WITNESS my hand and official.
_________________________________
Notary Public
My Commission Expires:
_____________________________
STATE OF_________________)
) SS
COUNTY OF________________)
On _______________, 1996, before me,
____________________________, a Notary Public in and
for the County and State aforesaid, personally appeared
_________________________, personally known to me (or
proved to me on the basis of satisfactory evidence) to
be the same person whose name is subscribed to the
within and acknowledged to me that _____ executed the
same in _____ authorized capacity, and that by _____
signature on the instrument the person or the entity
upon behalf of which the person acted, executed the
instrument.
WITNESS my hand and official.
_________________________________
Notary Public
My Commission Expires:
_____________________________
STATE OF_________________)
) SS
COUNTY OF________________)
On _______________, 1996, before me,
____________________________, a Notary Public in and
for the County and State aforesaid, personally appeared
_________________________, personally known to me (or
proved to me on the basis of satisfactory evidence) to
be the same person whose name is subscribed to the
within and acknowledged to me that _____ executed the
same in _____ authorized capacity, and that by _____
signature on the instrument the person or the entity
upon behalf of which the person acted, executed the
instrument.
WITNESS my hand and official.
_________________________________
Notary Public
My Commission Expires:
_____________________________
EXHIBIT A
Rockville Property
Montrose Office Park
0000-0000 Xxxxx Xxxx Xxxxxxxxx
Xxxxxxxxx, Xxxxxxxxxx Xxxxxx, Maryland
Recording Requirements
Parcel Identifier #: 4-201-1995656
County Tax Account #: ____________
Street Address: _________________________
_________________________
Grantor's Name and Address: Montrose Office Park Joint Venture
c/o Glenborough Corporation
000 Xxxxx Xx Xxxxxx Xxxx
00xx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Trustee: Chicago Title Insurance Company
Title Insurer: Chicago Title Insurance Company
Certification
I hereby certify that I am a member of the Bar of
the Court of Appeals of Maryland and that the foregoing
Amended and Restated Deed of Trust, with Absolute
Assignment of Leases and Rents, Security Agreement,
Assignment of Equipment Leases and Rents, Security
Agreement, Assignment of Equipment Leases, Assignment
of Permits and Fixture Filing was prepared under my
supervision.
/s/ Xxxx Xxxxxx Xxxxxxx
A:\MDDOT.WPD January 8, 1997 (6:10p)
