(For Recorder's Use Only)
RECORDING REQUESTED BY AND Mortgage and Security Agreement dated as of June
AFTER RECORDING RETURN TO: 5, 2003, executed by Seller in favor of Original
Midland Loan Services, Inc. Lender, filed for record on June 24, 2003, in the
10851 Xxxxxx, Suite 700 Commission of Records for the City and County of
Xxxxxxxx Xxxx, XX 00000 Philadelphia, Pennsylvania (the "Recording
Attention: Xxxxx X. Xxxxxx Office") as Instrument No. 50697188 (the "Security
Instrument"), as assigned to Lender pursuant to
that certain Assignment of Mortgage and Security
Agreement dated as of June 10, 2003, executed by
Original Lender, filed for record on August 4,
2004, in the Recording Office as Instrument No.
50985495 ("Assignment of Mortgage").
Loan Number 00-0000000
CONSENT AND ASSUMPTION
AGREEMENT WITH RELEASE
This Consent and Assumption Agreement With Release (this "Agreement") is
entered into as of June 16, 2006 by and among XXXX XXXXXXXX XXXX, XX, a Delaware
limited partnership, and XXXX XXXXXXXX HILL II, LP, a Delaware limited
partnership, jointly and severally, as tenants-in-common, having an address at
000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (collectively, "Seller"), XXXXXX X.
XXXX, an individual, having an address at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 ("Original Principal"), ACADIA CHESTNUT LLC, a Delaware limited liability
company, having an address at 0000 Xxxxxxxxxx Xxxxxx, Xxxxx 000, Xxxxx Xxxxxx,
Xxx Xxxx 00000 ("Buyer"), ACADIA REALTY LIMITED PARTNERSHIP, a Delaware limited
partnership, having an address at 0000 Xxxxxxxxxx Xxxxxx, Xxxxx 000, Xxxxx
Xxxxxx, Xxx Xxxx 00000 (referred to herein as "New Principal" or "New Property
Manager"), XXXXX FARGO BANK, N.A., successor by consolidation to Xxxxx
Fargo Bank Minnesota, N.A., as Trustee under the Pooling and Servicing Agreement
dated as of December 1, 2003, for the Registered Holders of Credit Suisse First
Boston Mortgage Securities Corp. Commercial Mortgage Pass-Through Certificates
Series 2003-C5, having an address at c/o Midland Loan Services, Inc., 00000
Xxxxxx, Xxxxx 000, Xxxxxxxx Xxxx, XX 00000, Re: Loan Number 00-0000000
("Lender").
RECITALS
A. Seller is the owner of certain real property located in Philadelphia
County, Commonwealth of Pennsylvania, commonly known as The Borders and Shoppes
at Chestnut Hill, which real property is more particularly described in Exhibit
"A" attached hereto and incorporated herein by reference. Such real property,
together with all improvements, fixtures and personal property located thereon,
is collectively referred to as the "Property".
B. By assignment, Lender is the owner and holder of certain documents (the
"Loan Documents") evidencing and securing a loan (the "Loan") made by Column
Financial, Inc., a Delaware corporation ("Original Lender"), to Seller,
including, without limitation, the:
(i) Promissory Note dated as of June 5, 2003, in the original
principal amount of $10,500,000.00, executed by Seller, as maker,
in favor of Original Lender (the "Note").
(ii) Mortgage and Security Agreement dated as of June 5, 2003,
executed by Seller in favor of Original Lender, filed for record
on June 24, 2003, in the Commission of Records for the City and
County of Philadelphia, Pennsylvania (the "Recording Office") as
Instrument No. 50697188 (the "Security Instrument"), as assigned
to Lender pursuant to that certain Assignment of Mortgage and
Security Agreement dated as of June 10, 2003, executed by
Original Lender, filed for record on August 4, 2004, in the
Recording Office as Instrument No. 50985495 ("Assignment of
Mortgage").
(iii) Assignment of Leases and Rents dated as of June 5, 2003,
executed by Seller in favor of Original Lender, filed for record
on June 24, 2003, in the Recording Office as Instrument No.
50697189 (the "Assignment of Leases"), as assigned to Lender
pursuant to that certain Assignment of Assignment of Leases and
Rents dated as of June 10, 2003, executed by Original Lender,
filed for record on June 24, 2003, in the Recording Office as
Instrument No. 50697189 ("Assignment of ALR").
(iv) Hazardous Substances Indemnity Agreement dated as of June 5,
2003, executed by Seller and Original Principal in favor of
Original Lender (the "Original Hazardous Substances Indemnity
Agreement").
(v) Indemnity and Guaranty Agreement dated as of June 5, 2003,
executed by Original Principal in favor of Original Lender (the
"Original Guaranty").
(vi) Certain UCC financing statements executed by Seller, as debtor,
in favor of Original Lender, as secured party, which financing
statements have been assigned of record to Lender ("Original
UCCs").
C. Midland Loan Services, Inc., a Delaware corporation, services the Loan
for Lender, as Master Servicer ("Servicer"), pursuant to that certain Pooling
and Servicing Agreement dated as
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of December 1, 2003, by and among Credit Suisse First Boston Mortgage Securities
Corp., as Depositor, Servicer, as Master Servicer, Clarion Partners, LLC, as
Special Servicer, Xxxxx Fargo Bank Minnesota, N.A., predecessor-in-interest to
Xxxxx Fargo Bank, N.A., as Trustee (the "Pooling and Servicing Agreement").
D. Seller and Buyer are parties to a Real Estate Purchase and Sale
Agreement dated as of March 15, 2006 (the "Purchase Agreement"), pursuant to
which the Property is to be transferred to Buyer and Buyer is to assume the Loan
(the "Transfer and Assumption"), and Seller and Buyer have requested that Lender
consent to the Transfer and Assumption.
E. Subject to the terms and conditions of this Agreement, Lender has agreed
to consent to the Transfer and Assumption.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the parties agree as follows:
1. CONSENT TO TRANSFER. Subject to satisfaction of all of the conditions
contained herein, Lender consents to the Transfer and Assumption and, in
connection therewith, to a change in management of the Property from Thor
Equities LLC, a Delaware limited liability company ("Original Property
Manager"), to New Property Manager. This consent is strictly limited to the
Transfer and Assumption described in this Agreement. This Agreement shall not
constitute a waiver or modification of any requirement of obtaining Lender's
consent to any future transfer of the Property or any portion thereof or
interest therein or future change in property management, nor shall it
constitute a modification of the terms, provisions, or requirements in the Loan
Documents in any respect except as expressly provided herein. Buyer specifically
acknowledges that any subsequent transfer of any interest in any of the Property
or interest in Buyer or change in property management in violation of the Loan
Documents shall be a default thereunder. The Loan Documents are hereby ratified
and, except as expressly modified in this Agreement, remain unmodified and are
in full force and effect.
2. LOAN INFORMATION. The parties hereto agree that as of the date hereof:
(a) The outstanding principal balance of the Note is $10,074,623.52.
(b) The interest rate of the Note is a fixed rate of 5.45% per annum.
(c) The maturity date of the Note is June 11, 2013.
(d) The following listed payments are due and payable on the eleventh
(11th) day of each and every calendar month as of the date of Closing
(as hereinafter defined):
(i) $59,288.87 principal and interest installments;
(ii) $19,491.75 Impound Account (as defined in the Security
Instrument) deposits;
(iii) $677.50 Replacement Reserve (as defined in the Security
Instrument) deposits; and
(e) Deposits to the TILC reserve shall be made in accordance with the
Loan Documents.
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(f) The current balance of each escrow account held by Lender with
respect to the Loan Note is:
(i) $105,045.85 Impound Account (as defined in the Security
Instrument);
(ii) $11,985.59 Replacement Reserve (as defined in the Security
Instrument);
(iii) $14,375.00 Repair and Remediation Reserve (as defined in the
Security Instrument) after the increase to such reserve
contemplated by Section 35(f) hereof; and
(iv) $0.00 TILC Reserve (as defined in the Security Instrument);
(g) All required payments due through June 11, 2006, under the Loan
Documents have been paid.
(h) Lender is the current owner and holder of the Loan Documents.
3. CONDITIONS. In addition to any other conditions set forth herein or required
by Lender, the following are conditions precedent that must be satisfied prior
to the closing of the Transfer and Assumption (the "Closing"):
(a) The execution, acknowledgment, delivery and recordation of this
Agreement by all of the parties concurrently with the Closing.
(b) The execution, delivery and recordation or filing, as applicable, of
one or more new financing statements, or amendments to existing
financing statements as required by Lender at Closing.
(c) Buyer's delivery to Lender of satisfactory evidence that all
insurance over the Property required by the Loan Documents (the
"Required Insurance") is in full force and effect as of the Closing,
with all required premiums paid, and contains a mortgagee's clause
(the "Mortgagee's Clause") satisfactory to Lender in favor of Xxxxx
Fargo Bank, N.A., successor by consolidation to Xxxxx Fargo Bank
Minnesota, N.A., as Trustee under the Pooling and Servicing Agreement
dated as of December 1, 2003, for the Registered Holders of Credit
Suisse First Boston Mortgage Securities Corp. Commercial Mortgage
Pass-Through Certificates Series 2003-C5, and its successors and/or
assigns, c/o Midland Loan Services, Inc., Master Servicer, 00000
Xxxxxx, Xxxxx 000, Xxxxxxxx Xxxx, XX 00000; re: Loan Number
030238961.
(d) Lender's receipt of satisfactory Title Endorsements (hereinafter
defined).
(e) The full release and reconveyance of any other liens or monetary
encumbrances against the Property.
(f) Lender's receipt of all of the Required Payments (hereinafter
defined).
(g) Lender's receipt of legal opinions from counsel for Buyer in form and
substance satisfactory to Lender.
(h) Lender's receipt of a W9 form from Buyer.
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(i) Execution by Buyer and New Principal and delivery to Lender of a new
Hazardous Substances Indemnity Agreement in form and substance
acceptable to Lender in its sole and absolute discretion (the "New
Hazardous Substances Indemnity Agreement").
(j) Execution by New Principal and delivery to Lender of a new Indemnity
and Guaranty Agreement in form and substance acceptable to Lender in
its sole and absolute discretion (the "New Guaranty").
(k) Buyer shall enter into a Cash Management Agreement in form and
substance acceptable to Lender.
(l) Bank of America shall enter into a Deposit Account Agreement in form
and substance acceptable to Lender.
(m) Dismissal with Prejudice of that certain lawsuit (the "Lawsuit"),
Xxxx Xxxxxxxx Hill, L.P., a Delaware limited partnership and Xxxx
Xxxxxxxx Xxxx, X.X., a Delaware limited partnership, Plaintiffs,
against Xxxxx Fargo Bank, N.A. f/k/a Xxxxx Fargo Bank Minnesota,
N.A., as trustee for the Registered Holders of Credit Suisse First
Boston Mortgage Security Corp. Commercial Mortgage Pass-Through
Certificates, Series 2003-C5, Case Number 2:05-CV-02765-LDD, pending
in the Untied States District Court, Eastern District of
Pennsylvania, pursuant to the Dismissal attached hereto.
4. FEES, PAYMENT AND EXPENSES. Buyer covenants and agrees to pay to Lender at
Closing the following (the "Required Payments"):
(a) $25,186.56, which represents an assumption fee for Lender's consent
to the Transfer and Assumption (the "Assumption Fee") and an
application fee of $5,000.00.
The Required Payments and any other fees and adjustments due and owing
under the Loan Documents or in connection with the Transfer and Assumption shall
be paid in accordance with Lender's settlement charges statement (the
"Settlement Statement") delivered at Closing for signature by Buyer and Seller.
In addition, at Closing, Buyer shall pay all of Lender's attorneys' fees
incurred in connection with this Agreement or the Transfer and Assumption in the
amount set forth on the Settlement Statement.
5. TITLE ENDORSEMENTS. At Closing, Buyer shall (a) cause First American Title
Insurance Company to issue such endorsements to Lender's mortgagee's title
insurance policy (Policy No. 294833) in such form as Lender may require ("Title
Endorsements"), including showing that the Buyer is the owner of the Property,
changing the effective date of such title policy to the date of the Closing, and
showing that the Loan Documents are in a first lien position, and (b) pay the
cost of the Title Endorsements, any escrow, filing or recording fees applicable
to this transaction, and any other costs and expenses incurred in connection
with this Agreement or this transaction, including, without limitation,
attorneys' fees.
6. BUYER'S ASSUMPTION OF LOAN; FINANCING STATEMENTS. Buyer hereby expressly
assumes the obligation to pay the unpaid balance due and owing on the Loan, all
interest thereon as provided in the Note and all other obligations under the
Loan Documents, with the same force and effect as if Buyer had been specifically
named therein as the original maker, borrower or grantor, as applicable. Without
limiting the generality of the foregoing, Buyer expressly assumes the obligation
to pay all loan installments as they become due and to observe all obligations
of the Loan Documents. Buyer's assumption of the foregoing obligations (a) is
absolute, unconditional and is not subject to any defenses, waivers, claims or
offsets, (b) shall not be affected or impaired by any agreement, condition,
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statement or representation of any person or entity other than Lender. Buyer
expressly agrees that it has read, approved and will comply with and be bound by
all of the terms, conditions, and provisions contained in the Loan Documents.
Buyer specifically agrees that if the Note is recourse, Lender's remedies shall
not in any respect or extent be limited solely to the Property or any other
collateral securing the Loan.
Buyer and New Principal, by their execution of this Agreement, jointly and
severally, agree to reimburse, defend, indemnify and hold Lender, its officers,
agents, loan servicers and employees harmless from and against any and all
liabilities, claims, damages, penalties, expenditures, losses or charges
(including, but not limited to, all legal fees and court costs), which may now
or in the future be undertaken, suffered, paid, awarded, assessed or otherwise
incurred as a result of or arising out of any fraudulent or tortious conduct of
Buyer or New Principal, in connection with this Agreement or the Property,
including the intentional misrepresentation of financial data presented to
Lender.
Buyer hereby authorizes Lender to file one or more new financing
statements, or amendments to existing financing statements, covering fixtures
and personal property collateral included in the Property and covered by the
security agreement contained in the Loan Documents, without signature of Buyer
where permitted by law. Buyer acknowledges and agrees that Lender continues to
have a security interest in all fixtures, personal property and other property
described in the Loan Documents (the "Collateral") transferred to Buyer by
Seller and further acknowledges and agrees that Lender shall continue to have a
security interest (and is hereby granted a security interest) in all Collateral
whether such Collateral is now owned by Buyer or is hereafter acquired by Buyer.
7. NO REPRESENTATIONS OF LENDER. The parties hereto agree that (a) Lender has
made no representations or warranty, either express or implied regarding the
Property and has no responsibility whatsoever with respect to the Property, its
condition, or its use, occupancy or status, and (b) no claims relating to the
Property, its condition, or its use, occupancy or status, will be asserted
against Lender or its agents, employees, professional consultants, affiliated
entities, successors or assigns, either affirmatively or as a defense.
8. ENVIRONMENTAL MATTERS. Buyer agrees, at its sole cost and expense, to keep or
cause the Property to be kept free of any hazardous, toxic or infectious
substance, material, gas or waste, including, without limitation, asbestos,
petroleum products and underground storage tanks, which is or becomes regulated
by any governmental authority with jurisdiction over the Property or Buyer, or
which has been identified as a toxic cancer-causing, or other hazardous
substance (collectively the "Hazardous Materials"), and to remove or take
remedial action with regard to any Hazardous Materials released into the
environment at, on or near the Property, provided that:
(a) Any such removal or remedial action shall be undertaken in a manner
so as to minimize any impact on tenants of the Property.
(b) Buyer shall indemnify Lender for any action taken by Buyer or Lender
to comply with this requirement.
(c) In the event Buyer fails to fully comply and satisfy this requirement
and fails to cure such failure within 30 days after Lender gives
written notice to Buyer, Lender may, at its sole option, declare the
Loan immediately due and payable and/or cause the Hazardous Materials
to be removed from the Property and add all costs incurred in
affecting the removal to the balance of the Loan. Buyer grants to
Lender and its agents and employees access to the Property and the
license to remove such Hazardous Materials.
6
9. ENVIRONMENTAL INDEMNIFICATION. Supplementing the terms of the Loan Documents
and any "New Loan Documents" (as hereinafter defined), Buyer acknowledges and
agrees that it will reimburse, defend, indemnify and hold Lender, its officers,
agents, loan servicers and employees harmless from and against any and all
liabilities, claims, damages, penalties, expenditures, losses or charges
(including, but not limited to, all costs of investigation, monitoring, legal
fees, remedial response, removal, restoration or permit acquisition) which may
now or in the future, be undertaken, suffered, paid, awarded, assessed or
otherwise incurred as a result of:
(a) any Hazardous Materials existing on, in, above or under the Property
at the time of execution of this Agreement or at any time in the
future;
(b) any investigation, monitoring, cleanup, removal, restoration,
remedial response or remedial work undertaken with regard to
Hazardous Materials on, in, above or under the Property.
10. SELLER'S AND ORIGINAL PRINCIPAL'S REPRESENTATIONS, WARRANTIES AND COVENANTS.
Seller and Original Principal hereby represent, warrant, and covenant that:
(a) Seller is the owner of the Property and Seller and Original Principal
are duly authorized to execute, deliver and perform this Agreement.
(b) Any court or third-party approvals necessary for Seller or Original
Principal to enter into this Agreement have been obtained.
(c) The entities and/or persons executing this Agreement on behalf of
Seller and Original Principal are duly authorized to execute and
deliver this Agreement.
(d) This Agreement and the Loan Documents are in full force and effect
and the transactions contemplated therein constitute valid and
binding obligations of Seller and Original Principal, as applicable,
enforceable against Seller and Original Principal, as applicable, in
accordance with their terms, and have not been modified either orally
or in writing.
(e) Lender has not waived any requirements of the Loan Documents nor any
of Lender's rights thereunder.
(f) There is no existing "Event of Default" (as defined in the Loan
Documents) or event or condition that, with the giving of notice or
passage of time or both, would constitute an Event of Default.
(g) All taxes and assessments applicable to the Property that are due and
payable as of the Closing have been paid.
(h) The next payment for real property taxes applicable to the Property
is due on or before December 31, 2006.
(i) To the best of Seller's knowledge, all representations and warranties
in the Purchase Agreement are true and correct.
(j) All representations and warranties referred to herein shall be true
as of the date of this Agreement and the Closing and shall survive
the Closing, provided that nothing herein shall mean or be deemed to
mean that the representations and warranties in the Purchase
7
Agreement, which are not also specifically set forth herein, shall
survive, except as may be expressly set forth in the Purchase
Agreement.
(k) Upon consummation of the Transfer and Assumption, Seller shall have
no further interest in the escrow accounts held by Lender and
described in subsection 2(e) of this Agreement.
Lender is entitled to rely, and has relied, upon these representations,
warranties and covenants in the execution and delivery of this Agreement and all
other documents and instruments executed and delivered by Lender in connection
with this Agreement.
11. BUYER'S AND NEW PRINCIPAL'S REPRESENTATIONS, WARRANTIES AND COVENANTS. Buyer
and New Principal hereby represent, warrant, and covenant that:
(a) Buyer and New Principal are duly authorized to execute, deliver and
perform this Agreement.
(b) Any court or third-party approvals necessary for Buyer or New
Principal to enter into this Agreement have been obtained.
(c) The entities and/or persons executing this Agreement on behalf of
Buyer or New Principal are duly authorized to execute and deliver
this Agreement.
(d) This Agreement, the "New Loan Documents" (as hereinafter defined),
and the Loan Documents are in full force and effect and the
transactions contemplated therein constitute valid and binding
obligations of Buyer and New Principal, as applicable, enforceable
against Buyer and New Principal, as applicable, in accordance with
their terms and have not been modified either orally or in writing.
(e) There is no existing Event of Default or event or condition that,
with the giving of notice or passage of time or both, would
constitute an Event of Default.
(f) All taxes and assessments applicable to the Property that are due and
payable as of the Closing have been paid.
(g) The next payment for real property taxes applicable to the Property
is due on or before December 31, 2006.
(h) All representations and warranties in the Purchase Agreement are true
and correct.
(i) There is no bankruptcy, receivership or insolvency proceeding pending
or threatened against Buyer or New Principal.
(j) Neither Buyer nor New Principal has Buyer does not have any intention
to do any of the following prior to the Closing or within the 180
days following the Closing: (i) seek entry of any order for relief as
debtor and a proceeding under the Code (hereinafter defined), (ii)
seek consent to or not contest the appointment of a receiver or
trustee for itself or for all or any part of its property, (iii) file
a petition seeking relief under any bankruptcy, arrangement,
reorganization or other debtor relief laws, or (iv) make a general
assignment for the benefit of its creditors.
8
(k) All of the Required Insurance is in full force and effect, with all
required premiums paid, and contains the required Mortgagee's Clause.
(l) The general partner of New Principal is Acadia Realty Trust (the
"Final Owner"). Final Owner owns 98% of New Principal and controls
New Principal.
(m) All representations and warranties referred to herein shall be true
as of the date of this Agreement and the Closing and shall survive
the Closing.
Lender is entitled to rely, and has relied, upon these representations,
warranties and covenants in the execution and delivery of this Agreement and all
other documents and instruments executed and delivered by Lender in connection
with this Agreement.
12. RELEASE OF SELLER AND ORIGINAL PRINCIPAL. Lender hereby releases Seller and
Original Principal from all liability and obligations under the Loan Documents
arising from and after the Closing, including, but not limited to, repayment of
the Loan, but excepting, without limitation (i) any environmental or other
damage to the Property occurring prior to the Closing, (ii) any obligations
arising from the Purchase Agreement, (iii) any liability related to or arising
from Seller's acts or omissions occurring prior to the Closing, and (iv) any
liability related to or arising from fraudulent or tortious conduct, including
intentional misrepresentation of financial data presented to Lender.
13. RELEASE OF LENDER. Seller, for itself and for its agents, employees,
representatives, officers, directors, general partners, limited partners, joint
shareholders, beneficiaries, trustees, administrators, subsidiaries, affiliates,
employees, servants and attorneys, and Original Principal, for itself and for
its agents, employees, representatives, officers, directors, general partners,
limited partners, joint shareholders, beneficiaries, trustees, administrators,
subsidiaries, affiliates, employees, servants and attorneys (collectively, the
"Seller Releasing Parties") jointly and severally release and forever discharge
Lender, Clarion Partners, LLC and Midland Loan Services, Inc., and their
respective successors, assigns, partners, directors, officers, employees,
agents, attorneys, administrators, trustees, subsidiaries, affiliates,
beneficiaries, shareholders and representatives from all liabilities,
obligations, costs, expenses, claims and damages, at law or in equity, known or
unknown, which any of the Seller Releasing Parties may now or hereafter hold or
claim to hold under common law or statutory right, arising in any manner out of
the Property, the Loan, any of the Loan Documents or any of the documents,
instruments or any other transactions relating thereto or the transactions
contemplated thereby. Without limiting the generality of the foregoing, this
release shall include the following matters: (a) the Lawsuit and any and all
claims that were or could have been brought therein, (b) all aspects of this
Agreement and the Loan Documents, any negotiations, demands or requests with
respect thereto, and (c) Lender's exercise or attempts to exercise any of its
rights under this Agreement, any of the Loan Documents, at law or in equity. In
connection with its release of any and all claims relating to the Lawsuit,
Seller has delivered to Lender the Dismissal and agrees to take any and all
actions necessary to fully dismiss the Lawsuit with prejudice. The Seller
Releasing Parties agree that this release is a full, final and complete release
and that it may be pleaded as an absolute bar to any or all suit or suits
pending or which may thereafter be filed or prosecuted by any of the Seller
Releasing Parties, or anyone claiming by, through or under any of the Seller
Releasing Parties. The Seller Releasing Parties agree that this release is
binding upon each of them and their respective agents, employees,
representatives, officers, directors, general partners, limited partners, joint
shareholders, beneficiaries, trustees, administrators, subsidiaries, affiliates,
employees, servants and attorneys.
Buyer, for itself and for its agents, employees, representatives, officers,
directors, general partners, limited partners, joint shareholders,
beneficiaries, trustees, administrators, subsidiaries, affiliates, employees,
servants and attorneys, and New Principal, for itself and for its agents,
employees,
9
representatives, officers, directors, general partners, limited partners, joint
shareholders, beneficiaries, trustees, administrators, subsidiaries, affiliates,
employees, servants and attorneys (collectively, the "Buyer Releasing Parties")
jointly and severally release and forever discharge Lender and Midland Loan
Services, Inc., and their respective successors, assigns, partners, directors,
officers, employees, agents, attorneys, administrators, trustees, subsidiaries,
affiliates, beneficiaries, shareholders and representatives from all
liabilities, obligations, costs, expenses, claims and damages, at law or in
equity, known or unknown, which arise out of any matters occurring prior to the
Closing in connection with the transactions contemplated hereby. The Buyer
Releasing Parties agree that this release is a full, final and complete release
and that it may be pleaded as an absolute bar to any or all suit or suits
pending or which may thereafter be filed or prosecuted by any of the Buyer
Releasing Parties, or anyone claiming by, through or under any of the Buyer
Releasing Parties. The Buyer Releasing Parties agree that this release is
binding upon each of them and their respective agents, employees,
representatives, officers, directors, general partners, limited partners, joint
shareholders, beneficiaries, trustees, administrators, subsidiaries, affiliates,
employees, servants and attorneys.
14. REFERENCES IN THE LOAN DOCUMENTS. Seller, Original Principal, Buyer, New
Principal, and Lender hereby acknowledge and agree that the terms "Mortgagee"
"Grantee", "Beneficiary", "Lender" and "Assignee" contained in the Loan
Documents shall be deemed to refer to Lender and its successors and/or assigns.
Seller, Original Principal, Buyer, New Principal, and Lender further acknowledge
and agree that from and after the date of this Agreement, the terms "Mortgagor"
"Grantor", "Borrower" and/or "Assignor" contained in the Loan Documents shall be
deemed to refer to Buyer.
15. RATIFICATION AND CONFIRMATION OF THE LOAN. Buyer and New Principal agree to
perform each and every obligation under the Loan Documents, as specifically
modified by this Agreement, and any other loan documents executed on or about
the date of this Agreement for the purpose of evidencing, securing or otherwise
relating to the Loan (the "New Loan Documents") in accordance with their
respective terms and conditions. Buyer and New Principal ratify, affirm,
reaffirm, acknowledge, confirm and agree that the Loan Documents, as
specifically modified by this Agreement, remain in full force and effect and,
together with any New Loan Documents, represent legal, valid and binding
obligations of Buyer and New Principal, as applicable, enforceable against Buyer
and New Principal, as applicable, in accordance with their terms. Buyer and New
Principal agree that this Agreement does not diminish, impair, release or
relinquish the liens, powers, titles, security interests and rights securing or
guaranteeing payment of the Loan, including the validity or first priority of
the liens and security interests encumbering the Property granted Lender by the
Loan Documents and the New Loan Documents.
16. NONWAIVER. The parties hereto acknowledge and agree that (a) any
performance or non-performance of the Loan Documents prior to the date of this
Agreement does not affect or diminish Lender's ability to require future
compliance with the Loan Documents, and (b) in the future, Lender will require
strict compliance with and performance of the Loan Documents. Nothing contained
herein shall be construed as a waiver of any of Lender's rights or remedies with
respect to any default under this Agreement or any Loan Document.
17. BANKRUPTCY OF BUYER OR NEW PRINCIPAL. Buyer covenants and agrees that in the
event Buyer shall (i) file any petition with any bankruptcy court or be the
subject of any petition under the United States Bankruptcy Code (11 U.S.C.
Section 101 et seq., the "Code"), (ii) file or be the subject of any petition
seeking any reorganization, arrangement, composition, readjustment, liquidation,
dissolution, or similar relief under any present or future federal or state act
or law relating to bankruptcy, insolvency, or other relief for debtors, (iii)
have sought or consented to or acquiesced in the appointment of any trustee,
receiver, conservator, or liquidator, or (iv) be the subject of any order,
judgment, or decree entered by any
10
court of competent jurisdiction approving a petition filed against such party
for any reorganization, arrangement, composition, readjustment, liquidation,
dissolution, or similar relief under any present or future federal or state act
or law relating to bankruptcy, insolvency, or relief for debtors, Lender shall
thereupon be entitled, and Buyer irrevocably consents, to the entry of an order
by a bankruptcy court granting to Lender relief from any automatic stay imposed
by Section 362 of the Code, or otherwise, on or against the exercise of the
rights and remedies otherwise available to Lender as provided in the Loan
Documents, this Agreement or as otherwise provided by law or in equity, and
Buyer irrevocably waives its right to object to, attempt to enjoin or otherwise
interfere with such relief and the exercise and enforcement by Lender of its
rights and remedies following entry of such order. Without limiting the
generality of the immediately preceding sentence, Buyer agrees that Lender will
be entitled to and it consents to immediate relief from the automatic stay
imposed by the Code to allow Lender to take any and all actions necessary,
desirable or appropriate to enforce any rights Lender may have under the Loan
Documents, including, but not limited to, the right to possession of the
Property, collection of rents, and/or the commencement or continuation of an
action to foreclose Lender's liens and security interests. Buyer further agrees
that the filing of any petition for relief under the Code which postpones,
prevents, delays or otherwise hinders Lender's efforts to collect the amounts
due under the Note or to liquidate any of the collateral therefor shall be
deemed to have been filed in bad faith and, therefore, shall be subject to
prompt dismissal or conversion to a liquidation case under the Code upon motion
therefor by Lender. Further, Buyer agrees that it will not seek, apply for or
cause the entry of any order enjoining, staying, or otherwise prohibiting or
interfering with Lender's obtaining an order granting relief from the automatic
stay and enforcement of any rights which Lender may have under the Loan
Documents, including, but not limited to, Lender's right to possession of the
Property, collection of rents and/or the commencement or continuation of an
action to foreclose Lender's liens and security interests under the Loan
Documents.
New Principal covenants and agrees that in the event New Principal shall
(i) file any petition with any bankruptcy court or be the subject of any
petition under the Code, (ii) file or be the subject of any petition seeking any
reorganization, arrangement, composition, readjustment, liquidation,
dissolution, or similar relief under any present or future federal or state act
or law relating to bankruptcy, insolvency, or other relief for debtors, (iii)
have sought or consented to or acquiesced in the appointment of any trustee,
receiver, conservator, or liquidator, or (iv) be the subject of any order,
judgment, or decree entered by any court of competent jurisdiction approving a
petition filed against such party for any reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or similar relief under any
present or future federal or state act or law relating to bankruptcy,
insolvency, or relief for debtors, Lender shall thereupon be entitled, and New
Principal irrevocably consents, to the entry of an order by a bankruptcy court
granting to Lender relief from any automatic stay imposed by Section 362 of the
Code, or otherwise, on or against the exercise of the rights and remedies
otherwise available to Lender as provided in the Loan Documents, this Agreement
or as otherwise provided by law or in equity, and New Principal irrevocably
waives its right to object to, attempt to enjoin or otherwise interfere with
such relief and the exercise and enforcement by Lender of its rights and
remedies following entry of such order. Without limiting the generality of the
immediately preceding sentence, New Principal agrees that Lender will be
entitled to and it hereby consents to immediate relief from the automatic stay
imposed by the Code to allow Lender to take any and all actions necessary,
desirable or appropriate to enforce any rights Lender may have under the Loan
Documents, including, but not limited to, the right to possession of the
Property, collection of rents, and/or the commencement or continuation of an
action to foreclose Lender's liens and security interests. New Principal further
agrees that the filing of any petition for relief under the Code which
postpones, prevents, delays or otherwise hinders Lender's efforts to collect the
amounts due under the Note or to liquidate any of the collateral therefor shall
be deemed to have been filed in bad faith and, therefore, shall be subject to
prompt dismissal or conversion to a liquidation case under the Code upon motion
therefor by Lender. Further, New Principal agrees that it will not seek, apply
for or cause the entry of any order enjoining, staying, or otherwise prohibiting
or interfering with Lender's obtaining an order granting relief from the
automatic stay and enforcement of any rights which Lender may have
11
under the Loan Documents, including, but not limited to, Lender's right to
possession of the Property, collection of rents and/or the commencement or
continuation of an action to foreclose Lender's liens and security interests
under the Loan Documents.
18. COMPLIANCE WITH INTEREST LAW. It is the intention of the parties hereto to
conform strictly to any present or future law which has application to the
interest and other charges under the Loan Documents (the "Interest Law").
Accordingly, notwithstanding anything to the contrary in the Loan Documents, the
parties hereto agree that the aggregate amount of all interest or other charges
taken, reserved, contracted for, charged or received under the Loan Documents or
otherwise in connection with the Loan shall under no circumstances exceed the
maximum amount of interest allowed by the Interest Law. If any excess interest
is provided for in the Loan Documents, then any such excess shall be deemed a
mistake and canceled automatically and, if theretofore paid, shall be credited
against the indebtedness evidenced and secured by the Loan Document (the
"Indebtedness") (or if the Indebtedness shall have been paid in full, refunded
by Lender), and the effective rate of interest under the Loan Documents shall be
automatically reduced to the maximum effective contract rate of interest that
Lender may from time to time legally charge under the then applicable Interest
Law with respect to the Loan. To the extent permitted by the applicable Interest
Law, all sums paid or agreed to be paid to Lender for the use, forbearance or
detention of the Indebtedness shall be amortized, prorated, allocated and spread
throughout the full term of the Loan.
19. FURTHER ASSURANCES. The parties hereto agree to do any act or execute any
additional documents required by Lender, from time to time, to correct errors in
the documenting of the Transfer and Assumption, to effectuate the purposes of
this Agreement or to better assure, convey, assign, transfer, perfect or confirm
unto Lender the property and rights intended to be given it in the Loan
Documents and the New Loan Documents.
20. LIABILITY. If any party hereto consists of more than one person, the
obligations and liabilities of each such person hereunder shall be joint and
several. This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective heirs, legal representatives, successors and
assigns forever.
21. SEVERABILITY. If any term, covenant or condition of this Agreement is held
to be invalid, illegal or unenforceable in any respect, this Agreement shall be
construed without such term, covenant or condition and the validity or
enforceability of the remaining terms, covenants or conditions shall not in any
way be affected.
22. APPLICABLE LAW; JURISDICTION. This Agreement shall be governed and construed
in accordance with the laws of the state in which the Property is located. The
parties hereto submit to personal jurisdiction in the state courts located in
said state and the federal courts of the United States of America located in
said state for the enforcement of any obligations hereunder and waive any and
all personal rights under the law of any other state to object to jurisdiction
within such state for the purposes of any action, suit, proceeding or litigation
to enforce such obligations.
23. NO RESTRICTIONS ON PERFORMANCE. The execution and delivery of this Agreement
and compliance with the provisions hereof, will not conflict with, or constitute
a breach of or a default under any agreement or other instrument to which any
party hereto is a party or by which it is bound.
24. DEFINITIONS. Unless the context clearly indicates a contrary intent or
unless otherwise specifically provided herein, words used in this Agreement
(including pronouns) shall include the corresponding masculine, feminine or
neuter forms, and the singular form of such words shall include the plural and
vice versa. The words "included", "includes" and "including" shall each be
deemed to be
12
followed by the phrase, "without limitation." The words "herein", "hereby",
"hereof", and "hereunder" shall each be deemed to refer to this entire Agreement
and not to any particular paragraph, article or section hereof. Not withstanding
the foregoing, if any law is amended so as to broaden the meaning of any term
defined in it, such broader meaning shall apply subsequent to the effective date
of such amendment. Where a defined term derives its meaning from a statutory
reference, any regulatory definition is broader than the statutory reference and
any reference or citation to a statute or regulation shall be deemed to include
any amendments to that statute or regulation and judicial and administrative
interpretations of it.
25. SECURITIES ACT OF 1933. Neither Seller nor Buyer nor any agent acting for
any of them has offered the Note or any similar obligation for sale to or
solicited any offers to buy the Note or any similar obligation from any person
or party other than Lender, and neither Seller nor Buyer nor any agent acting
for any of them will take any action which would subject the sale of the Note to
the provisions of Section 5 of the Securities Act of 1933, as amended.
26. COMPLIANCE WITH ERISA. As of the date of this Agreement, neither Seller,
Buyer nor New Principal maintains any employee benefit plan which require
compliance with ERISA. If at any xxxx Xxxxxx, Buyer or New Principal shall
institute any employee benefit plans, they shall at all times comply with the
requirements of ERISA.
27. SOLE DISCRETION OF LENDER. Wherever pursuant to this Agreement, Lender
exercises any right given to it to approve or disapprove, or any arrangement or
term is to be satisfactory to Lender, Lender's decision to approve or disapprove
or to decide that arrangements or terms are satisfactory or not satisfactory
shall be in the sole and absolute discretion of Lender and shall be final and
conclusive, except as may be otherwise expressly and specifically provided
herein.
28. HEADINGS, ETC. The headings and captions of various paragraphs of this
Agreement 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. COUNTERPARTS. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original and all of which when taken
together shall constitute one and the same Agreement.
30. INTEGRATION, SURVIVAL. This Agreement, any New Loan Documents, and the Loan
Documents embody the entire agreement by and between the parties hereto with
respect to the Loan, and any and all prior correspondence, discussions or
negotiations are deemed merged therein. Except as otherwise specifically
provided herein, all obligations of any party contained in this Agreement, the
New Loan Documents or the Loan Documents shall survive the Closing, and Lender
hereby preserves all of its rights against all persons or entities and all
collateral securing the Loan, including, without limitation, the Property.
31. NO ORAL CHANGE. This Agreement, and any provisions hereof, may not be
modified, amended, waived, extended, changed, discharged or terminated orally or
by any act or failure to act on the part of any party hereto, but only by an
agreement in writing signed by the party against whom enforcement of any
modification, amendment, waiver, extension, change, discharge or termination is
sought. In addition, nothing contained in any document submitted for Lender's
review, including, without limitation any organizational documents of Buyer, New
Principal or any of their general partners, managers/members or officers, shall
modify, amend, waive, extend, change, discharge or terminate any term or
provision of the Loan Documents or constitute Lender's consent to any matter in
the Loan Documents requiring Lender's consent unless and until such time, if
any, as an agreement specifically
13
allowing such modification, amendment, waiver, extension, change discharge or
termination or consenting to such matter has been executed in writing by Lender.
32. NOTICES. Except as otherwise specified herein, any notice, consent, request
or other communication required or permitted hereunder shall be in writing and
shall be deemed properly given if delivered in accordance with the notice
requirements contained in the Loan Documents using the address for a party
hereto set forth at the top of the first page of this Agreement. Any notices or
other communications required or permitted under the Loan Documents shall be
provided in accordance with the requirements therefor as set forth in the Loan
Documents; provided, however, that from and after the date hereof the addresses
of Lender and Buyer (identified as "BORROWER" in the Security Instrument),
shall, subject to change as provided in the Loan Documents, be as set forth at
the top of the first page of this Agreement.
33. WAIVER OF JURY TRIAL. THE PARTIES HERETO KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED ON THE LOAN OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
AGREEMENT, THE NEW LOAN DOCUMENTS, OR THE LOAN DOCUMENTS, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENT (WHETHER VERBAL OR WRITTEN) OR ACTION OF
ANY PARTY HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT FOR LENDER'S CONSENT
TO THE TRANSFER AND ASSUMPTION.
34. INSURANCE. At all times Buyer shall comply with all terms of the Loan
Documents, including without limitation, the insurance requirements of the
Security Instrument. Although the Lender may accept certain evidence of
insurance for purposes of closing this Transfer and Assumption, Lender or its
servicer may at any time and from time to time request additional insurance
information from Buyer to ensure or monitor Buyer's compliance with the
insurance provisions of the Security Instrument and may request that Buyer
provide such coverages as Lender or its servicer may require consistent with the
terms of the Security Instrument. By entering into this Agreement, Lender
specifically does not waive or modify any of the insurance requirements under
the Security Instrument nor any of the remedies provided therein for failure to
secure such required insurance coverage.
35. AMENDMENTS TO AND AGREEMENT REGARDING SECURITY INSTRUMENT.
(a) Buyer acknowledges and agrees that from and after the date of the
Security Instrument, the provisions of Section 1.13 of the Security
Instrument shall apply to New Principal as if New Principal is now the
sole member of Buyer.
(b) Section 1.13(a) is hereby modified and amended to delete the first
full paragraph following Section 1.13(a)(5) including subparagraphs
(x), (y), and (z). The deleted first full paragraph begins with the
words "Notwithstanding the foregoing, for so long as Xxxx Xxxxxxxx
Hill Equity, L.P." and ends at the end of subparagraph (z) with the
words "connection with the loan secured hereby".
(c) Section 1.22(c) of the Security Instrument is hereby amended by
deleting the addresses for Mortgagor and replacing them with the
following address:
"Acadia Chestnut LLC
0000 Xxxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxx Xxxx 00000 "
14
Section 1.22(c) of the Security Instrument is further amended by
deleting the address for Mortgagee and replacing it with the following
address:
"Xxxxx Fargo Bank, N.A. successor by consolidation to Xxxxx Fargo
Bank Minnesota, N.A., as Trustee for the Registered Holders of
Credit Suisse First Boston Mortgage Securities Corp. Commercial
Mortgage Pass-Through Certificates Series 2003-C5
% Midland Loan Services, Inc.
00000 Xxxxxx, Xxxxx 000
Xxxxxxxx Xxxx, XX 00000"
(d) Section 1.29 of the Security Instrument is hereby amended by deleting
all references to "Thor Equities LLC" as the acceptable property
manager and replacing them with "Acadia Realty Limited Partnership, a
Delaware limited partnership."
(e) Section 4.4 of the Security Instrument is hereby amended by deleting
the notice addresses provided therein and substituting the following
therefor:
"Mortgagee Xxxxx Fargo Bank, N.A. successor by consolidation to
Xxxxx Fargo Bank Minnesota, N.A., as Trustee for the
Registered Holders of Credit Suisse First Boston
Mortgage Securities Corp. Commercial Mortgage
Pass-Through Certificates Series 2003-C5
c/o Midland Loan Services, Inc.
00000 Xxxxxx, Xxxxx 000
Xxxxxxxx Xxxx, XX 00000
Servicer: Midland Loan Services, Inc.
00000 Xxxxxx, Xxxxx 000
Xxxxxxxx Xxxx, XX 00000
Mortgagor: Acadia Chestnut LLC
0000 Xxxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxx Xxxx 00000 "
(f) Section C-1 of the Repair and Remediation Reserve is hereby modified
and amended to delete from the fourth line thereof the reference to
the amount of "$6,875.00" and to replace it with the amount of
"$14,375.00". Further, the second sentence of Section C-1, which
begins with the words "Manager shall cause each of the" and replacing
it with the following:
Manager shall cause each of the items described in that certain
Limited Property Condition Review for Loan Number 00-0000000 The
Gallery at Chestnut Hill Nova Project Number B06-0867 prepared by
Nova Consulting Group, Inc., dated April 14, 2006 (the
"Engineering Report"), relative to the Property, a copy of which
has been provided to, and receipt of which is hereby acknowledged
by, Mortgagor (the "Deferred Maintenance") to be completed,
performed, remediated and corrected to the satisfaction of
Mortgagee and as necessary to bring the Property into compliance
with all applicable laws, ordinances, rules and regulations on or
before December 16, 2006, as such time period may be extended by
Mortgagee in its sole discretion.
15
(g) Section C-2 of the Security Instrument is hereby modified and amended
to delete from the 11th line hereof the reference to the amount of
"$517.83" and replace it with the amount of "$677.50."
36. ACKNOWLEDGEMENT BY BUYER AND NEW PRINCIPAL REGARDING 1031 EXCHANGE. Buyer
and New Principal have informed Lender that Buyer is acquiring the Property and
assuming the Loan as part of a transaction which Buyer and New Principal
anticipate will comply with the provisions of Section 1031 of the Internal
Revenue Code allowing the deferment of any taxable gain or loss as the exchange
of like kind property. Buyer and New Principal acknowledge that they have not
relied on any advice, representations or statements of Lender or Midland Loan
Services, Inc., a Delaware corporation, or their respective employees or agents
concerning the tax, legal or investment consequences of Buyer's acquisition of
the Property and the assumption of the Loan, including, without limiting the
generality of the foregoing, whether the acquisition of the Property and
assumption of the Loan will comply with the requirements of Section 1031 of the
Internal Revenue Code or whether the Buyer's and New Principal's investment in
the Property is suitable, but instead Buyer and New Principal have obtained such
tax, legal and investment advice as to the effect of Buyer's acquisition of the
Property and assumption of the Loan from their own legal and other financial
advisors.
All of the membership interests of Buyer ("INTERESTS") are currently owned
by CDECRE, Inc., an Illinois corporation ("ACCOMMODATOR"), which is wholly owned
by Chicago Deferred Exchange Corporation. The Property has been indirectly
acquired by Accommodator, as exchange accommodation titleholder, to effect a
reverse like-kind exchange under Section 1031 of the Internal Revenue Code and
Rev. Proc. 2000-37, 2000-2 C.B. 308. This arrangement is described in a
Qualified Exchange Accommodation Agreement of even date herewith, between
Accommodator and New Principal. Following the disposition by New Principal of
certain relinquished property, Accommodator will transfer all of the Interests
to New Principal.
In order to qualify for "like-kind" treatment under Revenue Procedure
2000-37, the disposition of the relinquished property and the transfer of the
Interests to New Principal must occur on or before 180 days following the
acquisition by Buyer of the Property. The Qualified Exchange Accommodation
Agreement also provides that the right to cause the Accommodator to complete the
transfer of the Interests to New Principal prior to the expiration of the 180
day period, and if New Principal does not exercise such right during the 180-day
exchange period, Accommodator will transfer the Interests to New Principal on or
before the expiration of the 180 days period.
Also, as part of the exchange transaction, the acquisition of the Property
by Buyer has been financed using the proceeds of a loan made by New Principal to
Accommodator and Buyer ("ACQUISITION LOAN"). The obligations of Accommodator
under the Acquisition Loan are evidenced by a Promissory Note ("ACCOMMODATION
NOTE") made and given by Accommodator and Buyer of even date herewith in the
principal amount of the Acquisition Loan. The obligations of Accommodator and
Buyer under the Acquisition Loan are secured by an assignment to New Principal
by Accommodator of all of the Interests pursuant to that certain Pledge and
Security Agreement dated of even date herewith ("PLEDGE AGREEMENT"). The
Acquisition Loan will be repaid in full at the time the Interests are
transferred to New Principal. Prior to such transfer, all or substantially all
of the net revenue of the Property will be paid to New Principal as interest
under the Acquisition Loan.
The failure by any one of Assuming Borrower, New Principal and/or
Accommodator to cause the transfer of Interests to occur within the 180 day
period shall constitute an Event of Default under the Loan Documents. Further,
any assignment or pledge or other transfer New Principal's interests under the
Accommodation Note or the Pledge Agreement shall constitute an Event of Default
under the Loan Documents. Buyer shall deliver written notice to Lender
acknowledging the date that such Exchange
16
Transfer occurred ("EXCHANGE NOTICE"). Furthermore, Buyer shall include all
documents evidencing and documenting the transfer of Interests with the Exchange
Notice. Furthermore, in connection with the delivery of the Exchange Notice,
Buyer and New Principal shall deliver a certificate to Lender, in a form
acceptable to Lender in its reasonable discretion, whereby Buyer and New
Principal ratify and reaffirm all of their respective obligations under the Loan
Documents and upon receipt of the items referred to herein, the Lender will
consent to such transfer of Interests. Buyer shall pay, or cause to be paid at
closing, all Lender's costs and expenses of Lender including reasonable
attorneys fees for the transfer of Interests.
37. ACKNOWLEDGEMENT OF LIMITED LIABILITY OF ACCOMMODATOR. Notwithstanding any
provisions of these Loan Documents to the contrary ("ACCOMMODATOR"), is acting
as an exchange Accommodator titleholder in connection with a like-kind exchange
under IRC Section 1031 and Revenue Procedure 2000-37 for the benefit of the New
Principal. As an Accommodator party, the general credit of Accommodator is not
obligated or available for the payment of the indebtedness secured by the Loan
Documents. Lender will not look to Accommodator or Accommodator's directors,
officers, and employees with respect to the indebtedness evidenced by the Loan
Documents or any covenant, stipulation, promise, indemnity, agreement or
obligation contained herein. The Lender will not seek a deficiency or other
money judgment against Accommodator or Accommodator's member's, directors,
officers, and employees and will not institute any separate action against
Accommodator by reason of any default that may occur in the performance of any
of the terms and conditions of the Loan Documents between Buyer and Lender. This
agreement on the part of the Lender shall not be construed in any way so as to
effect or impair the lien of the Loan Documents or the Lender's right to
foreclose hereunder as provided by law or foreclosure proceedings or other
enforcement of payment of the indebtedness secured hereby out of and from the
security given therefore.
[remainder of page intentionally left blank]
17
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives as of the day, month and year
first above written.
SELLER:
XXXX XXXXXXXX XXXX, XX, a Delaware
limited partnership
By: THOR XX XXXXXXXX HILL, LLC, a
Delaware limited liability company,
its general partner
By:
------------------------------------
Name:
------------------------------
Title:
-----------------------------
[signatures continue on next page]
XXXX XXXXXXXX XXXX II, LP, a Delaware
limited partnership
By: THOR XX XXXXXXXX HILL II, LLC, a
Delaware limited liability company,
its general partner
By:
------------------------------------
Name:
------------------------------
Title:
-----------------------------
[signatures continue on next page]
ORIGINAL PRINCIPAL:
----------------------------------------
XXXXXX X. XXXX, an individual
[signatures continue on next page]
BUYER:
ACADIA CHESTNUT LLC, a Delaware limited
liability company
By: ACADIA REALTY LIMITED
PARTNERSHIP, a Delaware limited
partnership, as its manager
By: ACADIA REALTY TRUST, as its
general partner
By:
---------------------------
Name: Xxxxxx Xxxxxxx
Title: Senior Vice
President
[signatures continue on next page]
NEW PRINCIPAL:
ACADIA REALTY LIMITED PARTNERSHIP,
a Delaware limited partnership
By: ACADIA REALTY TRUST, as its general
partner
By:
------------------------------------
Name:
------------------------------
Title:
-----------------------------
[signatures continue on next page]
LENDER:
XXXXX FARGO BANK, N.A., SUCCESSOR BY
CONSOLIDATION TO XXXXX FARGO BANK
MINNESOTA, N.A., AS TRUSTEE UNDER THE
POOLING AND SERVICING AGREEMENT DATED AS
OF DECEMBER 1, 2003 (THE "POOLING AND
SERVICING AGREEMENT"), FOR THE
REGISTERED HOLDERS OF CREDIT SUISSE
FIRST BOSTON MORTGAGE SECURITIES CORP.
COMMERCIAL MORTGAGE PASS-THROUGH
CERTIFICATES SERIES 2003-C5
By: MIDLAND LOAN SERVICES, INC., a
Delaware corporation, as Master Servicer
under the Pooling and Servicing
Agreement and its Attorney-in-Fact
By:
------------------------------------
Name:
------------------------------
Title:
-----------------------------
[acknowledgments continue on next page]
ACKNOWLEDGMENTS
State
County
On this, the _____ day of June, 2006, before me ________________, the
undersigned officer, personally appeared ______________________, known to me (or
satisfactory proven) to be the ___________________ of Thor XX Xxxxxxxx Xxxx,
LLC, a Delaware limited liability company, which is the general partner of Xxxx
Xxxxxxxx Hill, LP, a Delaware limited partnership, and acknowledged that he as
such _____________________ being duly authorized to do so, executed the
foregoing instrument on behalf of such limited liability company, as manager of
such limited partnership, for the purposes therein contained.
In witness whereof, I hereunto set my hand and official seal
(Seal)
----------------------------------------
Notary Public
[acknowledgments continue on next page]
A-1
State
County
On this, the _____ day of June, 2006, before me ________________, the
undersigned officer, personally appeared ______________________, known to me (or
satisfactory proven) to be the ___________________ of Thor XX Xxxxxxxx Xxxx II,
LLC, a Delaware limited liability company, which is the general partner of Xxxx
Xxxxxxxx Hill II, LP, a Delaware limited partnership, and acknowledged that he
as such _____________________ being duly authorized to do so, executed the
foregoing instrument on behalf of such limited liability company, as manager of
such limited partnership, for the purposes therein contained.
In witness whereof, I hereunto set my hand and official seal
(Seal)
----------------------------------------
Notary Public
[acknowledgments continue on next page]
A-2
State
County
On this, the _____ day of June, 2006, before me ________________, the
undersigned officer, personally appeared Xxxxxx X. Xxxx, an individual, known to
me (or satisfactory proven) to be the person who executed the foregoing
instrument, and acknowledged that he executed the foregoing instrument for the
purposes therein contained.
In witness whereof, I hereunto set my hand and official seal
(Seal)
----------------------------------------
Notary Public
[acknowledgments continue on next page]
A-3
State
County
On this, the _____ day of June, 2006, before me ________________, the
undersigned officer, personally appeared Xxxxxx Xxxxxxx, known to me (or
satisfactory proven) to be the Senior Vice President of Acadia Realty Trust,
which is the general partner of Acadia Realty Limited Partnership, a Delaware
limited partnership, which is the manager of Acadia Chestnut LLC, a Delaware
limited liability company, and acknowledged that he as such Senior Vice
President being duly authorized to do so, executed the foregoing instrument on
behalf of such trust, for the purposes therein contained.
In witness whereof, I hereunto set my hand and official seal
(Seal)
-------------------------------------
Notary Public
[acknowledgments continue on next page]
A-4
State
County
On this, the _____ day of June, 2006, before me ________________, the
undersigned officer, personally appeared ______________________, known to me (or
satisfactory proven) to be the ___________________ of Acadia Realty Trust, which
is the general partner of Acadia Realty Limited Partnership, a Delaware limited
partnership, and acknowledged that he as such _____________________ being duly
authorized to do so, executed the foregoing instrument on behalf of such limited
partnership, as _____________ of such trust, for the purposes therein contained.
In witness whereof, I hereunto set my hand and official seal
(Seal)
-------------------------------------
Notary Public
[acknowledgments continue on next page]
A-5
State
County
On this, the _____ day of June, 2006, before me ________________, the
undersigned officer, personally appeared ______________________, known to me (or
satisfactory proven) to be the ___________________ of Midland Loan Services,
INC., a Delaware corporation, as Master Servicer on behalf of Xxxxx Fargo Bank,
N.A., successor by consolidation to Xxxxx Fargo Bank Minnesota, N.A., as Trustee
under the Pooling and Servicing Agreement dated as of December 1, 2003, for the
Registered Holders of Credit Suisse First Boston Mortgage Securities Corp.
Commercial Mortgage Pass-Through Certificates Series 2003-C5 ("Lender"), and
acknowledged that he as such _____________________ being duly authorized to do
so, executed the foregoing instrument on behalf of such Lender, as _____________
of such corporation, for the purposes therein contained.
In witness whereof, I hereunto set my hand and official seal
(Seal)
-------------------------------------
Notary Public
A-6
EXHIBIT "A"
LEGAL DESCRIPTION
PARCEL ONE
ALL THAT CERTAIN lot or piece of ground, with improvements erected thereon,
situated in the Ninth Xxxx of the City of Philadelphia and described according
to an ALTA/ACSM Survey and Plan of Property made by Xxxx X. Xxxxxxx, Surveyor
and Regulator of the Ninth Survey District, dated 6/12/1998, last revised April
25, 2003:
BEGINNING at a point of intersection of the Southwesterly legally open side of
Germantown Avenue (on City Plan 70' wide, legally open 60' wide) and the
Northwesterly legally open side of Gravers Lane (on City Plan 50' wide, legally
open 33' wide); thence extending southwestwardly along the northwest legally
open line of Gravers Lane, South 39 degrees 07 minutes 25 seconds West, the
distance of 190.922' to a point; thence extending and crossing the unopened
portion of said Xxxxxxx Xxxx, Xxxxx 00 degrees 52 minutes 35 seconds West, the
distance of 8.500' to a point on the northwest confirmed line of said Gravers
Lane; thence extending North 50 degrees 52 minutes 35 seconds West, the distance
of 112.00 feet to a point; thence extending South 39 degrees 07 minutes 25
seconds West, the distance of 84.000' to a point; thence extending North 50
degrees 52 minutes 35 seconds West, the distance of 28.000' to a point; thence
extending South 39 degrees 07 minutes 25 seconds West, the distance of 45.385'
to a point; thence extending North 50 degrees 52 minutes 35 seconds West, the
distance of 47.531' to a point; thence extending North 39 degrees 05 minutes 08
seconds East, the distance of 0.083' to a point; thence extending North 50
degrees 32 minutes 15 seconds West, the distance of 152.062' to a point; thence
extending South 39 degrees 00 minutes 35 seconds West, the distance of 2.969' to
a point; thence extending North 50 degrees 32 minutes 15 seconds West, the
distance of 140.000' to a point on the Southeasterly side of Highland Avenue (on
City Plan 60' wide, legally open); thence extending along the Southeasterly side
of Highland Avenue, North 39 degrees 00 minutes 35 seconds East, the distance of
52.969' to a point; thence extending South 50 degrees 32 minutes 15 seconds
East,. the distance of 170.990' to a point; thence extending North 39 degrees 00
minutes 35 seconds East, the distance of 40.000' to a point; thence extending
South 50 degrees 32 minutes 15 seconds East, the distance of 25.000' to a point;
thence extending South 39 degrees 00 minutes 35 seconds West, the distance of
8.000' to a point; thence extending South 50 degrees 32 minutes 15 seconds East,
the distance of 38.094' to a point; thence extending South 39 degrees 05 minutes
08 seconds West, the distance of 22.000' to a point; thence extending South 50
degrees 32 minutes 15 seconds East, the distance of 58.083' to a point; thence
extending and partly passing thru a portion of a (3) three story building wall,
North 39 degrees 05 minutes 08 seconds East, the distance of 257.041' to a point
on the said Southwesterly confirmed line of Germantown Avenue; thence extending
and recrossing the unopened portion of Xxxxxxxxxx Xxxxxx, Xxxxx 00 degrees 05
minutes 08 seconds East, the distance of 5.000' to a point on the Southwesterly
legally open line of Germantown Avenue; thence extending along the said
Southwesterly legally open line of Xxxxxxxxxx Xxxxxx, Xxxxx 00 degrees 20
minutes 45 seconds East, the distance of 196.257' to a point on the said
northwesterly legally open line of Gravers Lane, the first mentioned point and
place of beginning.
BEING commonly known as: 0000 Xxxxxxxxxx Xxxxxx.
A-7
PARCEL TWO
ALL THAT CERTAIN lot or piece of ground, with improvements erected thereon,
situate in the Ninth Xxxx of the City of Philadelphia, and described according
to an ALTAIASCM Survey and Plan of Property made by Xxxx X. Xxxxxxx, Surveyor
and Regulator of the Ninth Survey District dated 6/18/1998, last revised April
25, 2003.
BEGINNING at the point of intersection of the Northwesterly side of Bethlehem
Pike (60 feet wide, legally opened) and the Northeasterly side of Germantown
Avenue (60 feet wide, legally open); thence extending along the said
Northeasterly side of Germantown Avenue, North 58 degrees 56 minutes 00 seconds
West, the distance of 169.031 feet to a point; thence extending North 30 degrees
42 minutes 40 seconds East, the distance of 123.793 feet to a point; thence
extending South 76 degrees 43 minutes 56 seconds East, the distance of 112.358
feet to a point on the said Northwesterly side of Bethlehem Pike; thence
extending along the said Xxxxxxxxxxxxx xxxx xx Xxxxxxxxx Xxxx, Xxxxx 0 degrees
24 minutes 05 seconds West, the distance of 170.156 feet to a point on the said
Northeasterly side of Germantown Avenue, the first mentioned point and place of
beginning.
BEING commonly known as: 0000-0000 Xxxxxxxxxx Xxxxxx.
A-8
WHEN RECORDED, RETURN TO:
Winston & Xxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000 Attn; Xxxxx X. Xxxxxxx, Esq.
MORTGAGE AND SECURITY AGREEMENT
Loan No. 271089
THIS MORTGAGE AND SECURITY AGREEMENT (this "Mortgage") is made as of June
_, 2003, between XXXX XXXXXXXX XXXX, XX, a Delaware limited partnership
("Chestnut I") and XXXX XXXXXXXX HILL II, LP, a Delaware limited partnership
("Chestnut II"), each having an address c/o Thor Equities, LLC, 000 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, (Chestnut I aid Chestnut II are, collectively,
"Mortgagor"), jointly and severally for the benefit of COLUMN FINANIAL, INC., a
Delaware corporation ("Mortgagee"), whose address Eleven Madison Avenue, 9th
Floor, New York, New York 1001.03629 Att: Xxxxxx Xxxxxx.
WITNESSETH:
THAT FOR AND IN CONSIDERATION OF THE SUM OF TEN AND NOT 100 DOLLARS
($10.00), AND OTHER VALUABLE CONSIDERATION, INCLUDING THE INDEBTEDNESS HEREIN
RECITED AND THE TRUST HEREIN CREATED, THE RECEIPT AND SUFFICIENCY OF WHICH ARE -
HEREBY ACKNOWLEDGED, MORTGAGOR HAS MORTGAGED, GRANTED, CONVEYED, BARGAINED,
SOLD, TRANSFERRED, PLEDGED, ALIENED, ENFEOFFED, RELEASED, CONFIRMED,
WARRANTED AND SET OVER AND HEREBY IRREVOCABLY MORTGAGES, GRANTS, CONVEYS,
BARGAINS, SELLS, TRANSFERS, PLEDGES, ALIENS, ENFEOFFS, RELEASES, CONFIRMS,
WARRANTS, SETS OVER AND ASSIGNS, AND GRANTS A SECURITY INTEREST, TO AND IN FAVOR
OF MORTGAGEE, ITS SUCCESSORS AND ASSIGNS, in all of Mortgagor's estate, right,
title and interest in, to and under any and all of the following described
property, whether now owned or hereafter acquired (collectively, the
"Property"):
(A) All that certain real property situated in the County of Philadelphia,
Commonwealth of Pennsylvania, more particularly described on Exhibit A attached
hereto and incorporated herein by this reference (the "Real Estate"), together
with all of the easements, rights, privileges, franchises, tenements,
hereditaments, and appurtenances now or hereafter thereunto belonging or in any
way appertaining thereto, and all of the estate, right, title, interest,
claim and demand whatsoever of Mortgagor therein or thereto, either at law or in
equity, in possession or in expectancy, now owned or hereafter acquired;
(B) All structures, buildings and improvements of every kind and
description now or at any time hereafter located or placed on the Real Estate
(the "Improvements");
(C) All easements, rights-of-way, strips and gores of land, vaults,
streets, ways, alleys, passages, sewer rights, and other emblements now or
hereafter located on the Real Estate or under or above the same or any part or
parcel thereof, and all estates, rights, titles, interests, tenements,
hereditaments and appurtenances, reversions. and remainders whatsoever, in any
way belonging, relating or appertaining to the Property or any part thereof, or
which hereafter shaft in any way belong, relate or be appurtenant thereto,
whether now owned or hereafter acquired by Mortgagor;
(D) All furniture, furnishings, fixtures, goods, equipment, inventory or
personal property owned by Mortgagor and now or hereafter located on, attached
to or used in or about the Improvements, including, but not limited to, all
machines, engines, boilers, dynamos, elevators, stokers, tanks, cabinets,
awnings, screens, shades, blinds, carpets, draperies, lawn mowers, and all
appliances, plumbing, heating, air conditioning, lighting, ventilating,
refrigerating, disposal and incinerating equipment, and all fixtures and
appurtenances thereto, and such other goods and chattels and personal property
owned by Mortgagor as are now or hereafter used or furnished in operating the
Improvements, or the activities conducted therein, and all building materials
and equipment hereafter situated on or about the Real Estate or Improvements,
and all warranties and guaranties relating thereto, and all additions thereto
and substitutions and replacements therefore (exclusive of any of the foregoing
owned or leased by tenants of space in the Improvements);
(E) All water, water courses, ditches, xxxxx, reservoirs and drains and all
water, ditch, well, reservoir and drainage rights and powers which are
appurtenant to, located on, under or above or used in connection with the Real
Estate or the Improvements, or any part thereof, together (i) with all
utilities, utility lines, utility commitments, utility capacity, capital
recovery charges, impact fees and other fees paid in connection with same, (ii)
reimbursements or other rights pertaining to utility or utility services.
provided to the Real Estate and/or Improvements and (iii) the present or future
use or availability of waste water capacity, or other utility facilities to the
extent same pertain to or benefit the Real Estate and/or Improvements,
including, without limitation, all reservations of or commitments or letters
covering any such use in the future, whether now existing or hereafter created
or acquired;
(F) All minerals, crops, timber, trees, shrubs, flowers and landscaping
features now or hereafter located on, under or above the Real Estate;
(G) All cash funds, deposit accounts and other rights and evidence of
rights to cash, now or hereafter created or held by Mortgagee pursuant to this
Mortgage or any other of the Loan Documents (as hereinafter defined) including,
without limitation, all funds now or hereafter on deposit in the Reserves (as
hereinafter defined);
-2-
(H) All leases, licenses, tenancies, concessions and occupancy agreements
of the Real Estate or the Improvements now or hereafter entered into and all
rents, royalties, issues, profits, revenue, income and other benefits
(collectively, the "Rents" or "Rents and Profits") of the Real Estate, the
Improvements, or the fixtures or equipment, now or hereafter arising from the
use or enjoyment of all or any portion thereof or from any present or future
lease, license, tenancy, concession, occupancy agreement or other agreement
pertaining thereto or arising from any of the Contracts (as hereinafter defined)
or any of the General Intangibles (as hereinafter defined) and all cash or
securities (the "Security Deposits".) that secure performance by the tenants, -
lessees or licensees, as -applicable, of their obligations under any such
leases, licenses, concessions or occupancy agreements, whether said cash or
securities are to be held until the expiration of the terms of said leases,
licenses, concessions or occupancy agreements or applied to one or more of the
installments of rent coming due prior to the expiration of said terms, subject
to, however, the provisions contained in Section 1.11 of this Mortgage;
(I) All contracts and agreements now or hereafter entered into covering any
part of the Real Estate or the Improvements (collectively, the "Contracts") and
all revenue, income and other benefits thereof, including, without limitation;
management agreements, service contracts, maintenance contracts, equipment.
leases, personal property leases and any contracts or documents relating to
construction on any part of the Real Estate or the Improvements (including
plans, specifications, studies, drawings, surveys, tests, operating and other
reports, bonds and governmental approvals) or to the management or operation of
any part of the Real Estate or the Improvements;
(J) All present and future monetary deposits given to any public or private
utility with respect to utility services furnished to any part of the Real
Estate or the Improvements;
(K) All present and future funds, accounts, instruments, accounts
receivable, documents, causes of action, claims, general intangibles (including,
without limitation, trademarks, trade names, servicemarks and symbols now or
hereafter used in connection with any part of the Real Estate or the
Improvements, all names by which the Real Estate or the Improvements may be
operated or known, all rights to carry on business under such names, and all
rights, interest and privileges which Mortgagor has or may have as developer or
declarant under any covenants, restrictions or declarations now or hereafter
relating to the Real Estate or the Improvements) and all notes or chattel paper
now or hereafter arising from or by virtue of any transactions related to the
Real Estate 'or the Improvements (collectively, the "General Intangibles");
(L) All water taps, sewer taps, certificates of occupancy, permits, special
permits, uses, licenses, franchises, certificates, consents, approvals and other
rights and privileges now or hereafter obtained in connection with the Real
Estate or the Improvements and all present and future; warranties and guaranties
relating to the Improvements or to any equipment, fixtures, furniture,
furnishings, personal property or components of any of the foregoing now or
hereafter located or installed on the Real Estate or the Improvements;
(M) All building materials, supplies and equipment now or hereafter placed
on the Real Estate or in the Improvements and all architectural renderings,
models, drawings, plans, specifications, studies and data now or hereafter
relating to the Real Estate or the Improvements;
-3-
(N) All right, title and interest of Mortgagor in any insurance policies or
binders now or hereafter relating to the Property including any unearned
premiums thereon;
(O) All proceeds, products, substitutions and accessions (including claims.
and demands therefore of the conversion, voluntary or involuntary, of any of the
foregoing into cash or liquidated claims, including, without limitation,
proceeds of insurance and condemnation awards; and
(P) All other or greater rights and interests of every nature in the Real
Estate or the Improvements and in the possession or use thereof and income
therefrom, whether now owned or hereafter acquired by Mortgagor.
FOR THE PURPOSE OF SECURING:
(1) The debt evidenced by that certain Promissory Note (such Promissory
Note, together with any and all renewals, modifications, amendments,
restatements, consolidations, substitutions, replacements, and extensions
thereof, is hereinafter referred to as the "Note") of even date with this
Mortgage, made by Mortgagor and payable to the order of Mortgagee in the
original principal amount of TEN MILLION FIVE HUNDRED THOUSAND AND NOI100
DOLLARS ($10,500,000.00) (the "Loan" or the "Loan Amount"), together with
interest and any fees as therein provided;
(2) The full and prompt payment and performance of all of the provisions,
agreements, covenants and obligations herein contained and contained in any
other agreements, documents or instruments now or hereafter evidencing, securing
or otherwise relating to the indebtedness evidenced by the Note (the Note, this
Mortgage, the Assignment (as hereinafter defined), and such other agreements,
documents and instruments, together with any and all renewals, modifications,
amendments, restatements, consolidations, substitutions, replacements, and
extensions and modifications thereof, are hereinafter collectively referred to
as the "Loan Documents") and the payment of all other sums therein covenanted to
be paid, including, without limitation, any applicable yield maintenance
premiums or prepayment fees;
(3) Any and all future or additional advances (whether or not obligatory)
made by Mortgagee to protect or preserve the Property, or the lien or security
interest created hereby on the Property, or for taxes, assessments or insurance
premiums as hereinafter provided or for performance of any of Mortgagor's
obligations hereunder or under the other Loan Documents or for any other'
purpose provided herein or in the other Loan Documents (whether or not the
original Mortgagor remains the owner of the Property at the time of such
advances), together with interest thereon at the Default Interest Rate (as
defined in the Note); and
(4) Any and all other indebtedness now owing or which may hereafter be
owing by Mortgagor to Mortgagee, however and whenever incurred or evidenced,
whether express or implied, direct or indirect, absolute or, contingent, or due
or to become due, and all renewals, modifications, amendments, restatements,
consolidations, substitutions, replacements and extensions thereof.
(All of the sums referred to in Paragraphs (1) through (4) above are
herein sometimes referred to as the "secured indebtedness" or the "indebtedness
secured hereby").
-4-
TO HAVE AND TO HOLD the Property unto Mortgagee, its successors and assigns
forever, for the purposes and uses herein set forth.
PROVIDED, HOWEVER, that if the principal and interest and all other sums
due or to become due under the Note, including, without limitation, any
prepayment fees required pursuant to the terms of the Note, shall have been paid
at the time and in the manner stipulated therein and all other sums payable
hereunder and all other indebtedness secured hereby shall have been paid and all
other covenants contained in the Loan Documents shall have been performed, then,
in such case, this Mortgage shall be satisfied and the estate, right, title and
interest of Mortgagee in the Property shall cease, and upon payment to Mortgagee
of all costs and expenses incurred for the preparation of the release
hereinafter referenced and all recording costs if allowed by law, Mortgagee
shall release this Mortgage and the lien hereof by proper instrument
ARTICLE I
COVENANTS OF MORTGAGOR
For the purpose of further securing the indebtedness secured hereby and for
the protection of the security of this Mortgage, for so long as the indebtedness
secured hereby or any part thereof remains unpaid; Mortgagor represents,
covenants and agrees as follows:
1.1. - Warranties of Mortgagor. Mortgagor, for itself and its successors
and assigns, does hereby represent, warrant and covenant to and with Mortgagee,
its successors and assigns, that:
(a) Mortgagor has good, marketable and indefeasible fee simple title
to the Property, subject only to those matters expressly set forth on Exhibit B
attached hereto and by this reference incorporated herein (the "Permitted
Exceptions"), and has full power and lawful authority to grant, bargain, sell,
convey, assign, transfer and encumber its interest in the Property in the manner
and form hereby done or intended. None of the Permitted Exceptions materially
interferes with the security intended to be provided by this Mortgage, the
current primary use of the Property, or the current ability of the Property to
generate income sufficient to service the Loan. Mortgagor will preserve its
interest in and title to the Property and will forever warrant and defend the
same to Mortgagee against any and all claims whatsoever and will forever warrant
and defend the validity and priority of the lien and security interest created
herein against the claims of all persons and parties whomsoever, subject to the
Permitted Exceptions. The foregoing warranty of title shall survive 'the
foreclosure, exercise of any power of sale or other enforcement of this Mortgage
and shall inure to the benefit of and be enforceable by Mortgagee in the event
Mortgagee acquires title to the Property pursuant to any foreclosure, exercise
of any power of sale or otherwise;
(b) No bankruptcy or insolvency proceedings are pending or
contemplated by Mortgagor or, to the best knowledge of Mortgagor, against
Mortgagor or by or against any endorser, cosigner or guarantor of the Note;
(c) All reports, certificates, affidavits, statements and other data
furnished by Mortgagor to Mortgagee in connection with the Loan evidenced by the
Note are true and correct
-5-
in all material respects and do not omit to state any fact or circumstance
necessary to make the statements contained therein not misleading;
(d) The execution, delivery and performance of this Mortgage, the Note
and all of the other Loan Documents have been duly authorized by all necessary
action to be taken, and are, binding and enforceable against Mortgagor in
accordance with the respective terms thereof and do not contravene, result in a
breach of or constitute (upon the giving of notice or the passage of time or
both) a default under the partnership agreement, certificate or articles of
incorporation or other organizational documents of Mortgagor, or any contract or
agreement of any nature to which Mortgagor is a party or by which Mortgagor or
any of its property may be bound, and do not violate, or contravene any law,
order, decree, rule or regulation to which Mortgagor is subject;
(e) Mortgagor is not required to obtain any consent, approval or
authorization from or to file any declaration or statement with, any
governmental authority or agency in connection with or as a condition to the
execution, delivery or performance of this Mortgage, the Note or the other Loan
Documents which has not been so obtained or filed;
(f) Mortgagor has obtained or made all necessary (i) consents,
approvals and authorizations and registrations and filings of or with all
governmental authorities or agencies and (ii) consents, approvals, waivers and
notifications of partners, stockholders, members, creditors, lessors and other
non-governmental persons and/or entities, in each case, which are required to be
obtained or made by Mortgagor in connection with the execution and delivery of,
and the performance by Mortgagor of its obligations under, the Loan Documents;
(g) Mortgagor is not an "investment company", or a company
"controlled" by an "investment company", as such terms are defined in the
Investment Company Act of 1940, as amended;
(h) No part of the proceeds of the indebtedness secured hereby will be
used for the purpose of purchasing or acquiring any "margin stock" within the
meaning of Regulations T, U or X of the Board of Governors of the Federal
Reserve System or for any other purpose which would be inconsistent with such
Regulations T, U or X or any other Regulations of such Board of Governors, or
for any purpose prohibited by legal requirements or by the terms and conditions
of the Loan Documents;
(i) Mortgagor and, if Mortgagor is a partnership, any general partner
of Mortgagor, has filed all federal, state and local tax returns required to be
filed and has paid or made adequate provision for the payment of all federal,
state and local taxes, charges and assessments, including sales and payroll
taxes, payable by Mortgagor and its general partners, if any. Mortgagor and its
general partners, if any, believe that their respective tax returns properly
reflect the income and taxes of Mortgagor and said general partners, if any, for
the periods covered thereby, subject only to reasonable adjustments required by
the Internal Revenue Service or other applicable tax authority upon audit;
(j) -Mortgagor is not an "employee benefit plan", as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), which is subject
-6-
to Title I of ERISA and the assets of Mortgagor do not constitute "plan assets"
of one or more such plans within the meaning of 29 C.F.R. Section 2510.3-103;
(k) Except as set forth in those certain confirmation statements from
the City of Philadelphia nos. 161534 and 161550 both dated May 29, 2003, the
Real Estate and the Improvements and the intended use thereof by Mortgagor
comply with all applicable restrictive covenants, zoning ordinances, subdivision
and building codes, flood disaster laws, applicable health and environmental
laws and regulations and all other ordinances, orders or requirements issued by
any state, federal or municipal authorities having or claiming jurisdiction over
the Property. The Real Estate and Improvements constitute a separate tax parcel
or parcels for purposes of ad valorem taxation. The Real Estate and Improvements
do not require any rights over, or restrictions against, other property in order
to comply with any of the aforesaid governmental ordinances, orders or
requirements;
(l) All utility services necessary and sufficient for the full use,
occupancy, operation and disposition of the Real Estate and the Improvements for
their intended purposes are available to the Property, including water, storm
sewer, sanitary sewer, gas, electric, cable and telephone facilities, through
public rights-of-way or perpetual private easements reflected in the title
insurance policy insuring the lien of this Mortgage and approved by Mortgagee
(the "Title Insurance Policy");
(m) All streets, roads, highways, bridges and waterways necessary for
access to and full use, occupancy, operation and disposition of the Real Estate
and the Improvements have been completed, have been dedicated to and accepted by
the appropriate municipal authority and are open and available to the Real
Estate and the Improvements without further condition or cost to Mortgagor;
(n) All curb cuts, driveways and traffic signals shown on the survey
delivered to Mortgagee prior to the execution and delivery of this Mortgage are
existing and have been fully approved by the appropriate governmental authority;
(o) There are no judicial, administrative, mediation or arbitration
actions, suits or proceedings pending or threatened against or affecting
Mortgagor, (and, if Mortgagor is a partnership, any of its general partners, or
if Mortgagor is a limited liability company, any member of Mortgagor) or the
Property which, if adversely determined, would have a material adverse effect on
(a) the Property, (b) the business, prospects, profits, operations or condition
(financial or otherwise) of Mortgagor, (c) the enforceability, validity,
perfection or priority of the lien of any Loan Document, or (d) the ability of
Mortgagor to perform any obligations under any Loan Document (collectively, a
"Material Adverse Effect");
(p) As of the date of this Mortgage (i) the Property is free from
delinquent water charges, sewer rents, taxes and assessments, and from
unrepaired damage caused by fire, flood, accident or other casualty, and (ii) no
part of the Real Estate or the Improvements has been taken in condemnation,
eminent domain or like proceeding nor is any such proceeding pending or to
Mortgagor's knowledge and belief, threatened or contemplated,
-7-
(q) Mortgagor possesses all franchises, patents, copyrights,
trademarks, trade navies, licenses and permits adequate for the conduct of its
business substantially as now conducted;
(r) Except as set forth in the Title Insurance Policy insuring the
lien of this Mortgage, no improvements on adjoining properties encroach upon the
Property. To the best of Mortgagor's knowledge, the Improvements are
structurally sound, in good repair and free of defects in materials and
workmanship and have been constructed and installed in substantial compliance
with the plans and specifications relating thereto. All major building systems
located within the Improvements, including without limitation the heating and
air conditioning systems and the electrical and plumbing systems, are in working
order and condition;
(s) Except as disclosed in writing to Mortgagee prior to the date
hereof, there are no security agreements or financing statements affecting any
of the Property other than the security agreements and financing statements
created in favor of Mortgagee;
(t) Mortgagor has delivered a true, correct and complete schedule (the
"Rent Roll") of all leases affecting the Property (collectively, 'Leases") as of
the date hereof, which accurately and completely sets forth in all material
respects for each such Lease, the following; the name of the tenant, the lease
expiration date, extension and renewal provisions, the base rent payable, and
the Security Deposit held thereunder. Mortgagor is in compliance with all legal
requirements relating to such Security Deposits;
(u) No tenant under any Lease has, as of the date hereof, paid rent
more than thirty (30) days in advance, and the rents under such Leases have not
been waived, released, or otherwise discharged or compromised;
(v) The Property is free and clear of any mechanics' or materialmen's
liens or liens in the nature thereof, and no rights are outstanding that under
law would give rise to any such liens, any of which liens are or may be prior
to, or equal with, the lien of this Mortgage, except those which are insured
against by the Title Insurance Policy;
(w) No Lease or Contract or easement, right of way, permit or
declaration (collectively, "Property Agreements") provides 'any party with the
right to obtain, a lien or encumbrance upon the Property superior to the lien of
this Mortgage;
(x) Mortgagor has delivered to Mortgagee true, correct and complete
copies of all Property Agreements and no default exists or to Mortgagor's
knowledge would exist, with the passing of time or the giving of notice, or
both, under any Property Agreement which would, in the aggregate, have a
Material Adverse Effect;
(y) To the best knowledge of Mortgagor, no offset or any right of
offset exists respecting continued contributions to be made by any party to any
Property Agreement except as expressly set forth herein. Except as previously
disclosed to Mortgagee in writing, no material exclusions or restrictions on the
utilization, leasing or improvement of the Property (including non-compete
agreements) exist in any Property Agreement;
-8-
(z) To the best of Mortgagor's knowledge, all work, if any, to be
performed by Mortgagor under each of the Property Agreements has been
substantially performed, all contributions to be made by Mortgagor to any party
to such Property Agreement have been made, and all other conditions to such
party's obligations thereunder have been satisfied;
(aa) The Property is taxed separately without regard to any other
real estate and constitutes a legally subdivided lot under all applicable legal
requirements (or, if not subdivided, no subdivision or platting of the Property
is required under applicable legal requirements), and for all purposes may be
mortgaged, conveyed, pledged, hypothecated, assigned or otherwise dealt with as
an independent parcel;
(bb) The Property forms no part of any property owned, used or
claimed by Mortgagor as a residence or business homestead and is not exempt
from' forced sale under the laws of the State in 'which the Property is located.
Mortgagor hereby disclaims and renounces each and every claim to all or any
portion of the Property as a homestead. The Loan evidenced by the Loan Documents
is made and transacted solely for business, investment, commercial or other
similar purposes;
(cc) There are no outstanding options or rights of first offer or
refusal to purchase all or any portion of the Property or Mortgagor's interest
therein or ownership thereof;
(dd) There are no actions, suits, proceedings or orders of
record or of which Mortgagor has notice, and, to the best of Mortgagor's
knowledge, there are no inquiries or investigations, pending or threatened, in
any such case against, involving or affecting the Property, at law or in equity,
or before or by any federal, state, municipal or other governmental department,
commission, board, bureau agency or instrumentality, domestic or foreign,
alleging the violation of any federal, state or local law, statute, ordinance,
rule or regulation relating to Environmental Laws. Furthermore, Mortgagor has
not received any written claim, notice or opinion that the ownership or
operation of the Property violates any federal, state or local law, statute,
ordinance, rule, regulation, decree, order, and/or permit relating to
Environmental Laws, and, to the best of Mortgagor's knowledge, no valid basis
for any proceeding, action or claim of such nature exists;
(ee) Each Lease constitutes the legal, valid and binding
obligation of Mortgagor and, to the best of Mortgagor's knowledge and belief, is
enforceable against the tenant thereof;
(ff) All work to be performed by Mortgagor under the Leases has
been substantially performed, all contributions to be made by Mortgagor to the
tenants thereunder have been made and all other conditions precedent to each
such tenant's obligations thereunder have been satisfied;
(gg) Each tenant under a Lease has entered into occupancy of the
demised premises;
(hh) To the best of Mortgagor's knowledge and belief, each tenant
is free from bankruptcy, reorganization or arrangement proceedings or a general
assignment for the benefit of creditors;
-9-
(ii) Except as previously disclosed in writing to Mortgagee,
there are no brokerage fees or commissions payable by Mortgagor with respect to
the leasing of the space at the Property, and there are no management fees
payable by Mortgagor with respect to the management of the Property; and
(jj) The representations and warranties contained in this
Mortgage, or the review and inquiry made on behalf of Mortgagor therefor, have
all been made by persons having the requisite expertise and knowledge to provide
such representations and warranties. No statement or fact made by or on behalf
of Mortgagor in this Mortgage or in any certificate, document or schedule
furnished to Mortgagee pursuant hereto, contains any untrue statement of a
material fact or omits to state any material fact necessary to make statements
contained therein or herein not misleading (which may be to Mortgagor's best
knowledge where so provided herein)_ (provided, however, that with respect to
certificates, documents and/or schedules prepared by or provided by a party
other than Mortgagor or one of its affiliates, the foregoing representation is
limited to the best of Mortgagor's knowledge). There is no fact presently known
to Mortgagor which has not been disclosed to Mortgagee and which would have a
Material Adverse Effect.
1.2. Defense of Title. If, while this Mortgage is in force, the title to
the Property or the interest of Mortgagee therein shall be the subject, directly
or indirectly, of any action at law or in equity, or be attached directly or
indirectly, or endangered, clouded or adversely affected in any manner,
Mortgagor, at Mortgagor's expense, shall take all necessary and proper steps for
the defense of said title or interest, including the employment of counsel
reasonably approved by Mortgagee, the prosecution or defense of litigation, and
the compromise or discharge of claims made against said title or interest
1.3. Performance of Obligations. Mortgagor shall pay when due the principal
of and the interest on the indebtedness secured hereby including all charges,
fees and other sums required to be paid by Mortgagor as provided in the Loan
Documents, and shall observe, perform and discharge all obligations, and
conditions, and comply with all prohibitions, covenants and agreements to be
observed, performed or discharged by Mortgagor set forth in the Loan Documents
in accordance with their terms. In the event that Mortgagee reasonably
determines that Mortgagor, is not adequately performing any of its obligations,
under this Mortgage or under any of the other Loan Documents, Mortgagee may,
without limiting or waiving any other rights or remedies of Mortgagee hereunder,
take such steps with respect thereto as Mortgagee shall deem necessary or
proper, and any and all costs and expenses reasonably incurred by Mortgagee in
connection therewith, together with interest thereon at the Default Interest
Rate (as defined in the Note) from the date incurred by Mortgagee until actually
paid by Mortgagor, shall be immediately paid by Mortgagor on demand and shall be
secured by this Mortgage and by all of the other Loan Documents securing all or
any part of the indebtedness evidenced by the Note.
1.4. Insurance. Mortgagor shall, at Mortgagor's expense, maintain in force
and effect on the Property at all times while this Mortgage continues in effect
the following insurance:
(a) "All-risk" coverage insurance against loss or damage to the
Property from all-risk perils including, without limitation, acts of
terrorism. The amount of such insurance shall be not less than one hundred
percent (100%), of the full replacement cost of the
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Improvements, furniture, furnishings, fixtures, equipment and other items
(whether personality or fir fixtures) included in the Property and owned by
Mortgagor from time to time, without reduction for depreciation. The
determination of the replacement cost amount shall be adjusted annually to
comply with the requirements of the insurer issuing such coverage or, at
Mortgagee's election, by reference to such indexes, appraisals or information as
Mortgagee determines in its reasonable discretion. Full replacement cost, as
used herein, means, with respect to the Improvements, the cost of replacing the
Improvements without regard to deduction for depreciation, exclusive of the cost
of excavations, foundations and footings below the lowest basement floor, and
means, with respect to such furniture, furnishings, fixtures, equipment and
other items, the cost of replacing the same. Each policy or policies shall
contain a replacement cost endorsement and either an agreed amount endorsement
(to avoid the operation of any coinsurance provisions) or a waiver of any
co-insurance provisions, all subject to Mortgagee's approval.
(b) Commercial general liability insurance for personal injury, bodily
injury, death and property damage liability in amounts not less than $1,000,000
per occurrence, $2,000,000 aggregate (inclusive of umbrella coverage) or such
lesser amount as Mortgagee in Mortgagee's sole discretion may accept, for bodily
injury, personal injury and property damage. Mortgagee hereby retains the right
to periodically review the amount of said liability insurance being maintained
by Mortgagor and to require an increase in the amount of said liability
insurance should Mortgagee deem an increase to be reasonably prudent under then
existing circumstances.
(c) Insurance covering the major components of the central heating, air
conditioning and ventilating systems, boilers, other pressure vessels, high
pressure piping and machinery, elevators and escalators, if any, and other
similar equipment installed in the Improvements, in an amount equal to one
hundred percent (100%) of the full replacement cost of the Improvements which
policies shall insure against physical damage to and loss of occupancy and use
of the Improvements arising out of an accident or breakdown covered thereunder.
(d) If the Real Estate or any part thereof is identified by the Secretary
of Housing and Urban Development as being situated in an area now or
subsequently designated as having special flood hazards (including, without
limitation, those areas designated as Zone A or Zone V), flood insurance in an
amount equal to one hundred percent (100%) of the replacement cost of the
Improvements or the maximum amount of flood insurance available, whichever is
the lesser.
(e) During the period of any construction on the Real Estate or renovation
or alteration of the Improvements, a so-called "Builder's All Risk Completed
Value" or "Course of Construction" insurance policy in non-reporting form for
any Improvements under construction, renovation or alteration in an amount
approved by Mortgagee and Worker's Compensation Insurance covering all persons
engaged in such construction, renovation or alteration.
(f) Rental value or rental income insurance in amounts sufficient to
compensate Mortgagor for all Rents during a period of not less than one (1) year
in which the Property may be damaged or destroyed.
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(g) Law and ordinance coverage in an amount satisfactory to Mortgagee if
the Property; or any part thereof, shall constitute a nonconforming use or
structure under applicable zoning ordinances, sub-division and building codes or
other laws, ordinances, orders and requirements.
(h) Such other insurance - on the Property or on any replacements or
substitutions thereof or additions thereto as may from time to time be required
by Mortgagee against other insurable hazards or casualties which at the time are
commonly insured against in the case of property similarly situated, due regard
being given to the height and type of buildings, their construction, location,
use and occupancy.
All such insurance shall (i) be issued by companies approved by Mortgagee
and licensed to do business in the state where the Property is located, with a
claims paying ability rating of "A" or better by Standard & Poor's Rating
Services, a division of The McGraw Hill Companies, Inc., (ii) contain the
complete address of the Real, Estate (or a complete legal description), (iii) be
for a term of at least one (1) year, (iv) contain deductibles no greater than
$10,000.00 or as otherwise required by Mortgagee, and (v) be subject to the
approval of Mortgagee as to insurance companies, amounts, content, forms of
policies, method by which premiums are paid and expiration dates.
The "all-risk" commercial property and rental income insurance required
under Section 1.4(a) and 1.4(f) above shall cover perils of terrorism and acts
of terrorism and Mortgagor shall maintain commercial property and rental income
insurance for loss resulting from perils and acts of terrorism on terms
(including amounts) consistent with those required under Section 1.4(a) and
1.4(f) above, to the extent such insurance covering terrorism and acts of
terrorism is available at commercially reasonable rates or to the extent
available under the Terrorism Risk Insurance Act of 2002, as same may be
amended, replaced or extended from time to time, at all times during the term of
the Loan, provided, however, Mortgagor's insurance coverage may exclude perils
and acts of terrorism if Mortgagor also obtains, at Mortgagor's sole cost and
expense, a Terrorism Policy (hereinafter defined). The term 'Terrorism Policy",
as used herein, shall mean a separate stand-alone terrorism insurance. policy
obtained by Mortgagor which corresponds to Mortgagor's primary insurance
exclusion relating to acts or perils of terrorism such that there are no gaps in
coverage and being otherwise acceptable to Mortgagee and consistent as to
coverage amounts, ratings and conditions with the requirements of this. Section
1.4 as it relates to other sorts of insurance coverage. Mortgagor shall not
decline or otherwise terminate any terrorism coverage offered under Mortgagor's
all risk policy unless a Terrorism Policy is already in place.
Mortgagor shall as of the date hereof deliver to Mortgagee evidence that
said insurance policies have been paid current as of the date hereof and
certified copies of such insurance policies and original certificates of
insurance signed by an authorized agent evidencing such insurance satisfactory
to Mortgagee. Mortgagor shall renew all such insurance and deliver to Mortgagee
certificates evidencing such renewals at least thirty (30) days before any such
insurance shall expire. Without limiting the required endorsements to insurance
policies, Mortgagor further agrees that all such policies shall provide that
proceeds thereunder shall be payable to Mortgagee, its successors and assigns,
pursuant and subject to a mortgagee clause (without contribution) of standard
form attached to, or otherwise made a part of, the applicable
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policy and that Mortgagee, its successors and assigns, shall be named as an
additional insured under all liability insurance policies. Mortgagor further
agrees that all such insurance policies: (i) shall provide for at least thirty
(30) days prior written notice to Mortgagee prior to any cancellation or
termination thereof and prior to any modification thereof which affects the
interest of Mortgagee; (ii) shall contain an endorsement or agreement by the
insurer that any loss shall be payable to Mortgagee in accordance with the terms
of such policy notwithstanding any act or negligence of Mortgagor which might
otherwise result in forfeiture of such insurance; and (iii) shall either name
Mortgagee as an additional insured or waive all rights of subrogation against
Mortgagee. The delivery to Mortgagee of the insurance policies or the
certificates of insurance as provided above shall constitute an assignment of
all proceeds payable under such insurance policies by Mortgagor to Mortgagee as
further security for the indebtedness secured hereby. In the, event of
foreclosure of this Mortgage, or other transfer of title to the Property in
extinguishment in whole or in part of the secured indebtedness, all right, title
and interest of Mortgagor in and to all proceeds payable under such policies
then in force concerning the Property shall thereupon vest in the purchaser at
such foreclosure, or in Mortgagee or other transferee in the event of such other
transfer of title. Approval of any insurance by Mortgagee shall not be a
representation of the solvency of any insurer or the sufficiency of any amount
of insurance. In the event Mortgagor fails to provide, maintain, keep in force
or deliver and furnish to Mortgagee the policies of insurance required by this
Mortgage or evidence of their renewal as required herein, Mortgagee may, but
shall not be obligated to, procure such insurance and Mortgagor shall pay all
amounts advanced by Mortgagee, together with interest thereon at the Default
Interest Rate (as defined in the Note) from and after the date advanced by
Mortgagee until actually repaid by Mortgagor, promptly upon demand by Mortgagee.
Any amounts so advanced by Mortgagee, together with interest thereon, shall be
secured by this Mortgage and by all of the other Loan Documents securing all or
any part of the indebtedness evidenced by the Note. Mortgagee shall not be
responsible for nor incur any liability for the insolvency of the insurer or
other failure of the insurer to perform, even though Mortgagee has caused the
insurance to be placed with the insurer after failure of Mortgagor to finish
such insurance.
1.5. Payment of Taxes. Mortgagor shall pay or cause to be paid, except to
the extent provision is actually made therefore pursuant to Section L6 of this
Mortgage, all taxes and assessments which are or may become a lien on the
Property or which are assessed against or imposed upon the Property. If not
being paid by Mortgagee pursuant to Section 1.6, Mortgagor shall furnish
Mortgagee with receipts (or if receipts are not immediately available, with
copies of canceled checks evidencing payment with receipts to follow promptly
after they become available) showing payment of such taxes and assessments at
least fifteen (15) days prior to the applicable delinquency date therefore.
Notwithstanding the foregoing, Mortgagor may in good faith, by appropriate
proceedings, and upon notice to Mortgagee, contest the validity, applicability
or amount of any asserted tax or assessment so long as (a) such contest is
diligently pursued, (b) Mortgagee determines, in its subjective opinion, that
such contest suspends the obligation to pay the tax or assessment and that
nonpayment of such tax or assessment will not result in the sale, loss,
forfeiture or diminution of the Property or any part thereof or any interest of
Mortgagee therein, and (c) prior to the earlier of the commencement of such
contest or the delinquency date of the asserted tax or assessment, Mortgagor
deposits in the Impound Account (as hereinafter defined) an amount reasonably
determined by Mortgagee to be adequate to cover the payment of such tax or
assessment and a reasonable additional sum to cover possible interest, costs and
penalties; provided, however, that Mortgagor shall promptly cause to be paid any
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amount adjudged by a court of competent jurisdiction to be due, with all
interest, costs and penalties thereon, promptly after such judgment becomes
final; and provided further that in any event each such contest shall be
concluded and the taxes, assessments, interest, costs and penalties shall be
paid prior to the date any writ or order is issued under which the Property may
be sold, lost or forfeited.
1.6. Tax and Insurance Impound Account. Mortgagor shall establish and
maintain at all times while this Mortgage continues in effect an impound account
(the "Impound Account") with Mortgagee for payment of real estate taxes and
assessments and insurance on the Property as additional security for the
indebtedness secured hereby. Mortgagor shall deposit in the -Impound Account an
amount determined by Mortgagee to be sufficient (when added to the monthly
deposits described herein) to pay the next due annual installment of real estate
taxes and assessments on the Property at least one (1) month prior to the
delinquency date thereof (if paid in one installment) and the next due annual
insurance premiums with respect to the Property at least one (1) month prior to
the due date thereof (if paid in one installment). Commencing on the first
monthly payment date under the Note and continuing thereafter on each monthly
payment date under the Note, Mortgagor shall pay to Mortgagee, concurrently with
the monthly payment due under the Note, deposits in an amount equal to
one-twelfth (1/12) of the amount of the annual real estate taxes and assessments
that will next become due and payable on the Property, plus one-twelfth (1)12)
of the amount of the annual premiums that will next become due and payable on
insurance policies which Mortgagor is required to maintain. hereunder, each as
estimated and determined by Mortgagee, So long as no default hereunder or under
the other Loan Documents has occurred and is continuing, all sums in the Impound
Account shall be held by Mortgagee in the Impound Account to pay said taxes,
assessments and insurance premiums in one installment before the same become
delinquent. Mortgagor shall be responsible for ensuring the receipt by
Mortgagee, at least thirty (30) days prior to the respective due date for
payment thereof, of all bills, invoices and statements for all taxes,
assessments and insurance premiums to be paid from the Impound Account, and so
long as no default hereunder or under the other Loan Documents has occurred and
is continuing, Mortgagee shall pay the governmental authority or other party
entitled thereto directly to the extent funds are available for such purpose in
the Impound Account. In making any payment from the Impound Account, Mortgagee
shall be entitled to rely on any xxxx, statement or estimate procured from. the
appropriate public office or insurance company or agent without any inquiry into
the accuracy of such xxxx, statement or estimate and without any inquiry into
the accuracy, validity, enforceability or contestability of any tax, assessment,
valuation, sale, forfeiture, tax lien or title or claim thereof. No interest on
funds contained in the Impound Account shall be paid by Mortgagee to Mortgagor
on the Impound Account shall be solely for the account of
Mortgagee. If the total funds in the Impound Account shall exceed the amount of
payments actually applied by Mortgagee for the purposes of the Impound Account,
such excess may be credited by Mortgagee on subsequent payments to be made
hereunder or, at the option of Mortgagee, refunded to Mortgagor. If, however,
the Impound Account shall, not contain sufficient funds to pay the sums required
when the same shall become due and payable, Mortgagor shall, within ten (1,0)
days after receipt of written notice thereof, deposit with Mortgagee the full
amount of any such deficiency.
1.7. Tenant Improvements and Leasing Commissions Reserve.
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As additional security for the indebtedness secured hereby, Mortgagor shall
establish and main at all times while this Mortgage continues in-effect a
reserve (the "TILC Reserve") with Mortgagee for the payment of costs and
expenses incurred by Mortgagor for Tenant
Improvements and Leasing Commissions. All such sums, together with any
interest thereon, are hereinafter collectively referred to as the "Funds." As
used herein, the term "Tenant Improvements" shall mean construction or
modification of improvements on or installation of. fixtures or equipment in the
Property as required to be performed by Mortgagor pursuant to the terms of any
lease which is hereafter approved or, if such lease does not require approval by
Mortgagee, is hereafter entered into by Mortgagor and tenant pursuant to Section
1.12 hereof ("Approved Lease"). As used herein, the term "Leasing Commissions"
shall mean reasonable and customary commissions paid to a real estate broker
licensed in the state where the Property is located in connection with an
Approved Lease, pursuant to commission agreements containing such terms and"
provisions including, without limitation, as to the timing of the payment of the
commission, as are then prevailing between third party, unaffiliated owners and
brokers for comparable leases of space at properties similar to the Property in
the market area in which the Property is located.
(a) Deposits Into the TLLC Reserve/Interest on Funds.
(i) Mortgagor shall deposit into the TILC Reserve any amounts
paid to Mortgagor under leases containing lease termination options or
otherwise paid by tenants in consideration of an early termination of
any lease, other than amounts paid for rent and other charges with
respect to periods prior to the lease termination. To the extent a
portion of the TILC Funds are deposited into the I ILC Reserve
pursuant to this Section 1.7(a)(i) relative to a lease termination,
(A) such portion of the TILC Funds shall only be available for
disbursement after Mortgagor's provision of a Disbursement Request (as
hereinafter defined) and only to pay Tenant Improvements and/or
Leasing Commissions for an Approved Lease (or Approved Leases) of the
space at the Property which was subject to such lease termination, (B)
Mortgagor shall provide Mortgagee with a fully executed copy of an
Approved Lease (or Approved Leases) over the space which was
previously subject to the lease termination arrangement, and (C)
Mortgagor must satisfy all of the requirements of Section 1.7(b)(i),
(ii), (iii) and (iv) as to the Approved Lease(s) for which the request
is made. So long as no default hereunder or under the other Loan
Documents has occurred and is continuing, all sums in the TILC Reserve
shall be held by Mortgagee in the TILC Reserve to pay and/or reimburse
Mortgagor for the costs and expenses of Tenant Improvements and for
paying Leasing Commissions as herein set forth. Upon retenanting (in
accordance with the terms of this Mortgage) of all tenant space
originally subject to the lease that was the subject of the
termination payment deposited into the TILC Reserve and the receipt by
Mortgagee of reasonably satisfactory evidence of the commencement of
the payment of rent by the tenants under the new leases for such
re-tenanted space(s) (i.e., after the expiration of all. free rent
periods and rent concessions), provided no Event of Default then
exists and provided no Express Sweep Period (as defined in the Cash
Management Agreement) or Borders Sweep Period (as defined in the Cash
Management Agreement) is then in effect, upon request by Mortgagor,
all sums on deposit in the 11LC Reserve shall
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be disbursed to Mortgagor. Interest on the funds contained in the TILC
Reserve shall be credited to Mortgagor as provided in Section 4.28
hereof.
(ii) During any Express Sweep Period (as defined in the Cash
Management Agreement) and/or any Borders Sweep Period (as defined in
the Cash Management Agreement), all Excess Cash Flow (as defined in
the Cash Management Agreement) shall be deposited into the TILC
Reserve. To the extent a portion of the TILC Funds are deposited into
the TILC Reserve pursuant to this Section 1.7(a)(ii), (A) such portion
of the TILC Funds shall only be available for disbursement after
Mortgagor's provision of a Disbursement Request and only to pay Tenant
Improvements and/or Leasing Commissions for an Approved Lease (or
Approved Leases) of the space at the Property previously leased to
Express, Inc. (the "Express Space") and/or to Borders, Inc. (the
"Borders Space"), as applicable (to the extent that both an Express
Sweep Period and a Borders Sweep Period exist at the same time,
Mortgagee may, at its option, reasonably allocate the Excess Cash Flow
deposited into the TILC Reserve between the retenanting of the Express
Space and Borders Space in amounts that Mortgagee shall reasonably
determine), (B) Mortgagor shall provide Mortgagee with a fully
executed copy of an Approved Lease (or Approved Leases) over the space
which was previously subject to the lease termination arrangement, and
(C) Mortgagor must satisfy all of the requirements of Section
1.7(b)(i), (ii), (iii) and (iv) as to the Approved Lease(s) for which
the request is made. Upon re-tenanting of all of the Express Space and
Borders Space (or, if the Express, Inc. lease or the Borders, Inc.
lease, as applicable, are extended in accordance with the terms of
this Mortgage and the other tenant space is re-tenanted) in accordance
with the terms of this Mortgage and the receipt by Mortgagee of
reasonably satisfactory evidence of the commencement- of the payment
of rent by all tenants under the new leases for the re-tenanted
space(s) (i.e., after the termination of all free rent periods and
rent concessions), then, provided no Event of Default then exists,
upon request by Mortgagor, any sums on deposit in the TILC Reserve
that were deposited into the TILC Reserve pursuant to this Section
1.7(a)(ii) shall be disbursed to Mortgagor (any sums deposited in the
TILC Reserve pursuant to Section l.7(a)(i) shall be governed by
Section 1.07(a)(i)).
(b) Disbursements from the TILC Reserve. So long as no Event of
Default hereunder has occurred and is continuing, and to the extent Funds
are on deposit in the TILC Reserve, Mortgagee shall, within ten (10) days
after receipt of a written request from Mortgagor specifying the amount
requested and the applicable Tenant Improvements or Leasing Commissions to
be paid for with the requested Funds ("Disbursement Request"), release to
Mortgagor Funds in the amount of the Disbursement Request; subject,
however, to the provisions of Sections I.07(a)(i) and (ii) above and the
following conditions precedent. Mortgagee shall not be required to make
advances from the TILC Reserve more frequently than once in any thirty (30)
day period. In making any payment from the TILL Reserve, Mortgagee" shall
be entitled to rely on such request from Mortgagor, and on any xxxx,
statement, or estimate from any third party, without any inquiry into the
accuracy, validity or contestability of any such amount,
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(i) With respect to a Disbursement Request to pay for Tenant
Improvements, Mortgagor shall provide evidence reasonably satisfactory
to Mortgagee (including, if requested by Mortgagee, access to the
Property by Mortgagee and/or an architect and/or an engineer specified
by Mortgagee for the purpose of inspecting the work done, at
Mortgagor's expense) that the Tenant Improvements, or such portion
thereof, for which the Funds are being requested have been completed
in accordance with Section 1.7(c) below. Mortgagor shall submit to
Mortgagee copies of invoices for which Funds are being requested, and
if required by Mortgagee, shall also submit waivers of lien. Mortgagor
shall execute and deliver to Mortgagee a certificate (in form and
substance reasonably satisfactory to Mortgagee) that the Tenant
Improvements covered by the applicable Disbursement Request comply
with, and have fully satisfied, the terms and provisions of Section
1.7(c) below. Mortgagor shall provide such additional documents,
certificates and affidavits as Mortgagee may reasonably request.
(ii) With respect to the final Disbursement Request relative to
any Approved Lease, Mortgagor shall provide Mortgagee with (A) an
original estoppel certificate executed by the tenant under the
Approved Lease for which such request relates, stating that such
tenant has accepted the Tenant Improvements, and has occupied the
space covered by the Tenant Improvements and that there are no
defaults under such lease (nor does there exist any event or
conditions, which with the passage of time or the giving of notice, or
both, could result in such a default), (B) if required by Mortgagee,
an original subordination, non-disturbance and attomment agreement in
form acceptable to Mortgagee executed by the tenant under the Approved
Lease in favor of Mortgagee, (C) evidence of payment of rent by the
tenant under the Approved Lease and (D) a copy of any and all
applicable permanent certificates of occupancy and other governmental
permits, if any be required, issued by applicable governmental
authorities with respect to the Tenant Improvements, which
certificates and permits allow the tenant to open for business as
contemplated under such lease..
(iii) With respect to a Disbursement Request to pay any portion
of the Leasing Commissions, Mortgagor shall provide evidence as
reasonably requested by Mortgagee that such Leasing Commissions are
then due and payable or have been properly paid, and such additional
documents, certificates and affidavits as Mortgagee may reasonably
request;
(iv) Notwithstanding any provision of this Section 1.7 to the
contrary, Funds disbursed with respect to any Approved Lease (i) for
Tenant Improvements shall be an amount not to exceed, under any
circumstances, the reasonable costs and expenses actually incurred '
by Mortgagor therefore; and (ii) for Leasing Commissions shall be an
amount not to exceed, under any circumstances, the commission actually
incurred by Mortgagor therefore which is reasonable and customary for
a licensed real estate broker in the market area in which the Property
is located.
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(c) Mortgagor shall construct and complete all Tenant Improvements
within the time periods and as required by, and in accordance with, the
Approved Leases. Mortgagor or tenant shall pay for and obtain or cause to be
paid for and obtained all permits, licenses and approvals required by all
applicable laws with regard to the Tenant Improvements, whether necessary for
commencement, completion, use or otherwise. Mortgagor shall perform or cause to
be performed all work in connection with the Tenant Improvements in a good and
workmanlike manner, in compliance with all applicable laws (including, without
limitation, any and all applicable life safety laws, environmental laws and laws
for the handicapped and/or disabled) and, with respect only to those leases
requiring Mortgagee approval, with the plans and specifications approved (in
writing) by Mortgagee covering the same, which performance by Mortgagor shall be
without regard to the sufficiency of the Funds. Mortgagor covenants and agrees
that Tenant Improvements shall be constructed, installed or completed, as
applicable, free and clear of any and all liens (including mechanic's,
materialman's or other liens), claims and encumbrances whatsoever.
1.8. Security Interest In Reserves. (a) As additional security for the
payment and performance by Mortgagor of all duties, responsibilities and
obligations under the Note and the other Loan Documents, Mortgagor hereby
unconditionally and irrevocably assigns, conveys, pledges, mortgages, transfers,
delivers, deposits, sets over and confirms unto. Mortgagee, and hereby grants to
Mortgagee a security interest in all sums on deposit or due under this Mortgage
and the other Loan Documents including, without limitation, (i) the Impound
Account, the TILC Reserve, and, to the extent set forth on Exhibit C attached
hereto, any Repair and Remediation Reserve, and any other reserve set forth on
Exhibit C attached hereto (collectively, the "Reserves"), (ii) the accounts into
which the Reserves have been deposited, (iii) all insurance on said accounts,
(iv) all accounts, contract rights and general intangibles or other rights and
interests pertaining thereto, (v). all sums now or hereafter therein or
represented thereby, (vi) all replacements, substitutions or proceeds thereof,
(vii) all instruments and documents now or hereafter evidencing the Reserves or
such accounts, (viii) all powers, options, rights, privileges and immunities
pertaining to the Reserves (including the right to make withdrawals therefrom),
and (ix) all proceeds of the foregoing. Mortgagor hereby authorizes and consents
to the account into which the Reserves have been deposited being held in
Mortgagee's name or the name of any entity servicing the Note for Mortgagee and
hereby acknowledges and agrees that Mortgagee, or at Mortgagee's election, such
servicing agent, shall have exclusive control over said account. Notice of the
assignment and security interest granted to Mortgagee herein may be delivered by
Mortgagee at any time to the financial institution wherein the Reserves have
been established, and Mortgagee, or such servicing entity, shall have possession
of all passbooks or other evidences of such accounts. Mortgagor hereby holds
Mortgagee harmless with respect to all risk of loss regarding amounts on deposit
in the Reserves, except to the extent that any such loss is caused by the gross
negligence or intentional misconduct of Mortgagee. Mortgagor hereby knowingly,
voluntarily and intentionally stipulates, acknowledges and agrees that the
advancement of the funds from the Reserves as set forth herein is at Mortgagor's
direction and is not the exercise by Mortgagee of any right of set off or other
remedy upon a default. If a default shall occur hereunder or under any other of
the Loan Documents which is not cured within any applicable grace or cure
period, then, for so long as such default is continuing, Mortgagee may, without
notice or demand on Mortgagor, at its option: (A) withdraw any or all of the
funds (including, without limitation, interest) then remaining in the Reserves
and apply the same, after deducting all costs and expenses of safekeeping,
collection and delivery (including, but not
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limited to, attorneys fees, costs and expenses) to the indebtedness evidenced
by the Note or any other obligations of Mortgagor under the other Loan Documents
in such manner or as Mortgagee shall deem appropriate in its sole discretion,
and the excess, if any, shall be paid to Mortgagor, (B) exercise any and all
rights and remedies of a secured party under any applicable Uniform Commercial
Code, or (C) exercise any other remedies available at law or in equity. No such
use or application of the funds contained in the Reserves shall be deemed to
cure any Event of Default hereunder.
(b) The Reserves are solely for the protection of Mortgagee and entail
no responsibility on Mortgagee's part beyond the payment of the respective costs
and expenses in accordance with the terms thereof and beyond the allowing of due
credit for the sums actually received. Upon assignment of this Mortgage by
Mortgagee, any funds in the Reserves shall be turned over to the assignee and
any responsibility of Mortgagee, as assignor, with respect thereto shall
terminate. The Reserves shall not, unless otherwise explicitly required by
applicable law, be or be deemed to be escrow or trust funds, but, at Mortgagee's
option and in Mortgagee's discretion, may either be held in a separate account
or be commingled by Mortgagee with the general funds of Mortgagee. Upon full
payment of the indebtedness secured hereby in accordance with its terms (or if
earlier, the completion of the applicable conditions to release of each Reserve
to Mortgagee's satisfaction) or at such earlier time as Mortgagee may elect, the
balance in the Reserves then in Mortgagee's possession shall be paid over to
Mortgagor and no - other party shall have any right or claim thereto.
(c) Any amounts received by Mortgagee from Mortgagor may be invested
by Mortgagee (or its servicer) for its benefit, and Mortgagee shall not be
obligated to pay, or credit, any interest earned thereon to Mortgagor except as
may be otherwise specifically provided in this Mortgage.
1.9. Casualty and Condemnation Mortgagor shall give Mortgagee prompt
written notice of the occurrence of any casualty affecting, or the institution:
of any proceedings for eminent domain or for the condemnation of, the Property
or any portion thereof (collectively, an "Insured Event"). All insurance
proceeds on the Property, and all causes of action, claims, compensation, awards
and recoveries for any damage, condemnation or taking of all or any part of the
Property or for any damage or injury to it for any loss or diminution in value
of the Property, are hereby assigned-to and shall be paid to Mortgagee.
Mortgagee may participate in any suits or proceedings relating to any such
proceeds, causes of action, claims, compensation., awards or recoveries and
Mortgagee is hereby authorized, in its own name or in Mortgagor's name, to
adjust any loss covered by insurance or any condemnation claim or cause of
action, and to settle or compromise any claim or cause of action in connection
therewith, and Mortgagor shall from tune to time deliver to Mortgagee any
instruments required to permit such participation; provided, however, that
Mortgagee shall not have the right to participate in the adjustment of any loss
which is not in excess of the lesser of (i) ten percent (10%) of the then
outstanding principal balance of the Note, and (ii) $400,000.00. Provided no
default is then continuing hereunder or under any of the other Loan Documents
and no event has occurred which, with the giving of notice or the passage of
time or both, would constitute a default hereunder or under any of the other
Loan Documents, Mortgagee shall apply any sums received by it under this Section
first to the payment of all of its costs and expenses (including, but not
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limited to reasonable legal fees and disbursements) incurred in obtaining those
sums, and then, as follows:
(a) In the event that Mortgagee receives insurance proceeds or
condemnation awards upon the occurrence of an Insured Event in an amount excess
of the lesser of (i) ten percent 10%) of the then outstanding principal balance
of the Note, and (ii) $400.,000.00 (collectively, the "Threshold Amount"),
Mortgagor shall repair or restore the Property, and Mortgagee shall, to the
extent such insurance proceeds or condemnation awards are available for such
purpose under the provisions of this Section 1.09, disburse to Mortgagor the
amount paid or incurred by Mortgagor as a result of any such Insured Event for
costs and expenses incurred by Mortgagor to repair or restore the Property
(collectively the "Repairs") in accordance with, and satisfaction of, the terms
and conditions for disbursement relative to the Replacement Reserve as described
on Exhibit C hereto.
(b) In the event any proceeds or awards from an Insured Event exceed
the Threshold Amount but less than fifty percent (50%) of the Improvements
located on the Real Estate have been taken or destroyed, then if
(1) the Property can, in Mortgagee's reasonable judgment, with
diligent restoration or repair, be returned to a condition at least equal
to the condition thereof that existed prior to the casualty or partial
taking causing the loss or damage by the earlier to occur of the following
dates: (i) six (6) months after the receipt of insurance proceeds or
condemnation awards by either Mortgagor or Mortgagee, and (ii) six (6)
months prior to the stated maturity date of the Note, and
(2) all necessary governmental approvals can be obtained to allow
the rebuilding and reoccupancy of the Property as described in subsection
(b)(1) above, and
(3) there are sufficient sums available (through insurance
proceeds or condemnation awards and contributions by Mortgagor, the fill,
amount of which shall at Mortgagee's option have been deposited with
Mortgagee) for such restoration or repair (including, without limitation,
for, any reasonable costs and expenses of Mortgagee to incurred in
administering said restoration or repair) and for payment of principal and
interest to become due and payable under the Note during such restoration
or repair, and
(4) the economic feasibility of the Improvements after such
restoration or repair will be such that income from their operation is
reasonably anticipated to be sufficient to pay operating expenses of the
Property and debt service on the indebtedness secured hereby in full with
the same coverage ratio considered by Mortgagee in its determination to
make the Loan, and
(5) Mortgagor shall have delivered to Mortgagee, at Mortgagor's
sole cost and expense, an appraisal report from an appraiser, in form and
substance, satisfactory to Mortgagee appraising the value of the Property
as proposed to be restored or repaired to be not less than the appraised
value of the Property considered
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by Mortgagee in its determination to make the Loan, then, Mortgagee shall,
solely for the purposes of such restoration or repair, advance so much of
the remainder of such sums as may be required to facilitate such
restoration or repair, and any funds deposited by Mortgagor therefor, to
Mortgagor in the manner and upon such terms and conditions as would be
required by a prudent interim construction lender, including, but not
limited to, the prior approval by Mortgagee of plans and specifications,
contractors and the form of construction contracts and the furnishing to
Mortgagee of permits, bonds, lien waivers, invoices, receipts and
affidavits from contractors and subcontractors in form and substance
reasonably satisfactory to Mortgagee. Any remaining proceeds shall be
applied by Mortgagee for payment of the indebtedness secured hereby
(without prepayment penalty or premium) in whatever order as Mortgagee
directs, or released to Mortgagor, in its absolute discretion. Mortgagor
shall, in good faith, undertake reasonable efforts to cause the conditions
described in this Section 1.9(b) to be fully satisfied (e.g., Mortgagor
shall timely make applications for necessary governmental permits, shall
order an appropriate appraisal report, etc.). If such conditions are
satisfied, Mortgagor shall be obligated to undertake restoration and repair
of the damaged improvements subject to the terms of this Section 1.9.
Any disbursement pursuant to this clause (b) of sums by Mortgagee shall,
subject to Mortgagor's satisfaction of the provisions hereof, be in a manner to
promptly facilitate the restoration or repair of the Property. In the event
Mortgagor fails to meet the requirements of this clause (b), then Mortgagee may
elect in its absolute discretion and without regard to the adequacy of
Mortgagee's security, to accelerate the maturity date of the Note and declare
any. and all of the indebtedness secured hereby to be immediately due and
payable and apply the remainder of such sums to the payment of the secured
indebtedness (without prepayment penalty or premium) in whatever order Mortgagee
directs in its sole discretion, with any remainder being paid to Mortgagor.
(c) In all other cases, namely, in the event That fifty percent (50%)
or more of the Improvements located on the Real Estate have been taken or
destroyed and/or the requirements of Section 1.09(b) are not all satisfied,
Mortgagee may elect, in Mortgagee's absolute discretion and without regard to
the adequacy of Mortgagee's security, to (1) accelerate the maturity date of the
Note and declare any and all indebtedness secured hereby to be immediately due
and payable and apply the remainder of such sums received pursuant to this
Section to the payment of the secured indebtedness in whatever order Mortgagee
directs in its absolute discretion (without prepayment penalty or premium), with
any remainder being paid to Mortgagor, or (ii) make insurance or condemnation
proceeds available to Mortgagor for repair or restoration if Mortgagor
establishes to the satisfaction of Mortgagee, in its sole discretion, that
Mortgagor otherwise satisfies the requirements of Section 1.9(b) above. Should
Mortgagee make the election described immediately above in item (ii) of this
Section 1.9(c), Mortgagor shall be obligated to undertake restoration and repair
of the damaged Improvements consistent with the provisions of this Section 1.9.
(d) Any reduction in the indebtedness secured hereby resulting from
Mortgagee's application of any sums received by it hereunder shall take effect
only when Mortgagee actually receives such sums and elects to apply such sums to
the indebtedness secured hereby and, in any event, the unpaid portion of the
indebtedness secured hereby shall remain in
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full force and effect and Mortgagor shall not be excused in the payment thereof
Partial payments received by Mortgagee, as described in the preceding sentence,
shall be applied as set forth in Section 1.02(c) of the Note. If Mortgagor
undertakes to restore or repair the Property after the occurrence of a casualty
or partial taking of the Property as provided above, Mortgagor shall promptly
and diligently, at Mortgagor's sole cost and expense and regardless of whether
the insurance proceeds or condemnation award, as appropriate, shall be
sufficient for the purpose, restore, repair, replace and rebuild the Property as
nearly as possible to its value, condition and character immediately prior to
such casualty or partial taking in accordance with the foregoing provisions and
Mortgagor shall pay to Mortgagee all costs and expenses of Mortgagee incurred in
administering said rebuilding, restoration or repair, provided that Mortgagee
makes such proceeds or award available for such purpose. Mortgagor agrees to
execute and deliver from time to time such further instruments as may be
requested by Mortgagee to confirm the foregoing assignment to Mortgagee of any
award, damage, insurance proceeds, payment or other compensation. Mortgagor
hereby irrevocably constitutes and appoints Mortgagee the attorney in- fact of
Mortgagor (which power of attorney shall be irrevocable so long as any
indebtedness secured hereby is outstanding, shall be deemed coupled with an
interest, shall survive the voluntary or involuntary dissolution of Mortgagor
and shall not be affected by any disability or incapacity suffered by Mortgagor
subsequent to the date hereof), with full power of substitution, subject to the
terms of this Section, to settle for, collect and receive any such awards,
damages, insurance proceeds, payments or other compensation from the parties or
authorities making the same, to appear in and prosecute any proceedings therefor
and to give receipts and acceptance therefor,
1.10. Mechanics Liens. Mortgagor shall pay when due all claims and demands
of mechanics, materialman laborers and others for any work performed or
materials delivered for the Real Estate or the Improvements; provided, however,
that Mortgagor shall have the right to contest in good faith any such claim or
demand, so long as it does so diligently, by appropriate proceedings and without
prejudice to Mortgagee and provided that neither the Property nor any interest
therein would be in any danger of sale, loss or forfeiture as a result of such
proceeding or contest. In the event Mortgagor shall contest any such claim or
demand, Mortgagor shall promptly notify Mortgagee of such contest and thereafter
shall, upon Mortgagee's request, promptly provide a bond, cash deposit or other
security satisfactory to Mortgagee to protect Mortgagee's interest and security
should the contest be successful. If Mortgagor, shall fail to immediately
discharge or provide security (after the aforementioned request) against any
such claim or demand as aforesaid, Mortgagee may do so and any and all expenses
incurred by Mortgagee, together with interest thereon at the Default Interest
Rate (as defined in the Note) from the date incurred by Mortgagee until actually
paid by Mortgagor, shall be immediately paid by Mortgagor on demand and shall be
secured by this Mortgage and by all of the other Loan Documents securing all or
any part of the indebtedness evidenced by the Note.
1.11. Assignment of Leases and Rents. Mortgagor acknowledges and confirms
that, as additional collateral security for the payment of the indebtedness
secured hereby, and cumulative of any and all rights and remedies herein
provided, it has executed and delivered to Mortgagee an Assignment of Leases
and Rents of even date herewith (the "Assignment"), intending such Assignment to
create a present, absolute assignment to Mortgagee of the leases and Rents. Upon
the occurrence of a default under this Mortgage which has not been cured within:
any applicable grace or cure period, Mortgagee shall be entitled to exercise any
or all of
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the remedies provided in this Mortgage and in the Assignment, including, without
limitation, the appointment of a receiver. The Assignment shall continue in full
force and effect during any period of foreclosure or redemption with respect to
the Property.
1.12 Leases and Licenses
(a) Mortgagor covenants and agrees that it shall not entere into any lease
affecting 6,000 square feet or more of the Property or having a term
(including any renewal or extension term) of more than 10 years without the
prior written approval of the Mortgagee, which approval shall not be
unreasonably withheld. The request for approval of each such proposed
Mortgage, failure to approve or disapprove such proposed lease within ten
(10) business days is deemed approval and Mortgagor shall furnish to
Mortgagee (and any loan servicer specified from time to time by Mortgagee):
(i) such biographical and financial information about the proposed tenant
as Mortgagee may reasonably require in conjunction with its review, (ii) a
copy of the proposed form: of lease, and (iii) a summary of the material
terms of such proposed lease (including, without limitation, rental terms
and the term of the proposed lease and any options). It is acknowledged
that Mortgagee intends to include among its criteria for approval of any
such proposed lease the following: (i) such lease shall be with a bona-fide
arm's-length tenant; (ii) such lease shall not contain any rental or other
concessions which are not then customary and reasonable for similar
properties and leases in the market area of the Real Estate; (iii) such
lease shall provide that the tenant pays for its expenses; (iv) the rental
shall be at least at the market rate then prevailing for similar properties
and leases in the market areas of the Real Estate; and (v) such lease shall
contain subordination and attornment provisions in form and content
acceptable to Mortgagee. Failure of Mortgagee to approve or disapprove any
such proposed lease within ten (10) business days after receipt of such
written request and all the documents and information required to be
furnished to Mortgagee with such request shall be deemed approval, provided
that the written request for approval specifically mentioned the same (any
disapproval by Mortgagee shall contain the reasons, in reasonable detail,
for such disapproval)
(b) All other leases shall be written on the standard form lease (without
any material changes) which Mortgagee has approved and shall be on
arm's-length terms consistent with the terms for similar leases in the
market area of the Real Estate, shall provide for free rent only if the
same is consistent with prevailing market conditions and shall provide for
market rents then prevailing in the market area of the Real Estate. Such
leases shall also provide for Security Deposits in reasonable amounts.
Mortgagor shall also submit to Mortgagee for Mortgagee's approval, which
approval shall not be unreasonably withheld, prior to the execution
thereof, any proposed lease, license or occupancy agreement of the
Improvements or any portion thereof that differs materially and adversely
from the aforementioned form lease. Mortgagor shall not execute any lease,
license or occupancy agreement for all or a substantial portion of the
Property, except for an actual occupancy by the tenant, lessee or licensee
thereunder, and shall at all times promptly and faithfully perform, or
cause to be performed, all of the covenants,. conditions and agreements
contained in all leases, licenses. and occupancy agreements with respect to
the Property, now or hereafter existing, on the part of the landlord,
lessor or licensor thereunder to be kept and performed. In addition to the
requirements set forth in Section 1.18(c) of this Mortgage, Mortgagor shall
furnish to Mortgagee, within ten (10)'days after a request by Mortgagee to
do. so (but not more frequently than once per calendar quarter), a current
rent roll
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certified by Mortgagor as being true and correct containing the names of all
tenants, lessees and licensees with respect to the Property, the terms of their
respective leases, licenses or occupancy agreements, the spaces occupied and
the rentals or fees payable thereunder and the amount of each tenant's security
deposit. Upon the request of Mortgagee, Mortgagor shall deliver to Mortgagee a
copy of each such lease, license and occupancy agreement. Mortgagor shall not do
or suffer to be done any act that might result in a default by the landlord,
lessor or licensor under any such lease, license or occupancy agreement or allow
the tenant, lessee or licensee thereunder to withhold payment or rent and,
except as otherwise expressly permitted by the terms of Section 1.13 hereof,
shall not further assign any such lease, license or occupancy agreement or any
such rents. Mortgagor, at no cost or expense to Mortgagee, shall enforce, short
of termination, the performance and observance of each and every condition and
covenant of each of the parties under such leases. Mortgagor shall not, without
the prior written consent of Mortgagee, modify any of the leases; terminate or
accept the surrender of any leases, waive or release any other party from the
performance or observance of any obligation or condition under such leases
except, with respect only to leases affecting less than 6,000 square feet and
having a term of ten (10) years or less, in the normal course of business in a
manner which is consistent with sound and customary leasing and management
practices for similar properties in the community in which the Property is
located. Mortgagor shall not permit the prepayment of any rents under any of the
leases for more than one (1) month prior to the due date thereof.
1.13. Alienation and Further Encumbrances.
(a) Mortgagor acknowledges that Mortgagee has relied upon the
principals of Mortgagor and their experience in owning and operating properties
similar to the Property in connection with the closing of - the Loan.
Accordingly, except as specifically allowed hereinbelow in this Section and
notwithstanding anything to the contrary contained in Section 4.5 hereof, in the
event that the Property or any part thereof or interest therein shall be sold
(including any installment sales agreement), conveyed, disposed of, alienated,
hypothecated, leased (except to tenants of space in the Improvements in
accordance with the provisions of Section 1.12 hereof), assigned, pledged,
mortgaged, further encumbered or otherwise transferred or Mortgagor shall be
divested of its title to the Property or any interest therein, in my manner or
way, whether voluntarily or involuntarily, without the prior written consent of
Mortgagee being first obtained, which consent may be withheld in Mortgagee's
sole discretion, then the same shall constitute a default hereunder and
Mortgagee sill have the right, at its option, to declare any or all of the
indebtedness secured hereby, irrespective of the maturity date specified in the
Note, immediately due and payable and to otherwise exercise any of its other
rights and remedies contained in Article III hereof If such acceleration is
during any period when a prepayment fee is payable pursuant to the provisions
set forth in the Note, then, in addition to all of the foregoing, such
prepayment fee shall also then be immediately due and payable to the same end as
though Mortgagor were prepaying the entire indebtedness secured hereby on the
date of such acceleration. For the purposes of this Section, the sale,
conveyance, transfer, disposition, alienation, hypothecation, pledge or
encumbering (whether voluntarily or involuntarily) of all or any portion of the
ownership interest in (or, directly or indirectly through constituent parties,
any of the ultimate beneficial ownership interest in) Mortgagor shall be deemed
to be a transfer of an interest in the Property. Notwithstanding the foregoing,
however, transfers or assignments of ownership interests in Mortgagor (or its
constituent parties) may be undertaken without the consent of Mortgagee in the
following circumstances:
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(1) In the case of a Mortgagor which is a limited partnership, up to 49% of
the limited partnership interests in Mortgagor shall be freely transferable
so long as those persons responsible for the management and control of
Mortgagor and the Property remain unchanged following such transfer.
(2) In the case of a Mortgagor which constitutes a limited liability
company, up to 49% of the non-managing membership interests in Mortgagor
shall be freely transferable so long as those persons responsible for the
management and control of Mortgagor and the Property remain unchanged
following such transfer.
(3) In the case of a Mortgagor which constitutes a corporation, up to 49%
of the aggregate of the issued and outstanding capital stock of Mortgagor
may be sold or assigned, taking into account (i) any prior sales or
assignments, and (ii) the effective change in ownership resulting from any
issuance of new shares of capital stock in Mortgagor or its constituent
party.
(4) Gifts for estate planning purposes of any individual's interests in
Mortgagor or in any of Mortgagor's general partners, members or joint
venturers to the spouse or any lineal descendant of such individual, or to
a trust for the benefit of any one or more of such individual, spouse or
lineal descendant, shall not be a default under this Mortgage so long as
Mortgagor is reconstituted, if required, following such gift and so long as
those persons responsible for the management of the Property and Mortgagor
remain unchanged following such gift or any replacement management is
approved by Mortgagee.
(5) Involuntary assignments or transfers caused by the death, incompetence
or dissolution of Mortgagor, one of its constituent parties or the owner of
one of its constituent parties are permitted if: (i) Mortgagor is
reconstituted, if required, following such death, incompetence or
dissolution, and (ii) those persons responsible for the management and
control of Mortgagor and the Property remain unchanged as a result of such
death, incompetence or dissolution or any replacement management is
approved by Mortgagee,
Notwithstanding the foregoing, for so long as Xxxx Xxxxxxxx Xxxx Equity, LP, a
Delaware limited partnership ("Thor Equity") is a limited partner in Xxxx
Xxxxxxxx Hill, LP and/or Xxxx Xxxxxxxx. Xxxx II, LP, the following provision
shall apply with respect to Xxxx Xxxxxxxx Hill, LP and interests in such entity
and with respect to Than Chestnut Hill II, LP and interests in such entity:
limited partnership interests in Thor Equity may be freely transferred (and
limited partnership interests in. one or both of the entities comprising
Mortgagor may thereby be indirectly transferred) in excess of the limitations
established in Section 1.13(x)(1) above so long as, following each such
transfer, all of the following conditions are satisfied:
(x) at all times, Xxxxxx X. Sift shall own, directly or indirectly, at
least twenty five percent (25%) of the ownership interests in each of the
entities comprising Mortgagor;
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(y) at all times, Xxxxxx X Xxxx shall possess, directly or indirectly,
the power to direct or cause the direction of the management, operations
and policies of each of the entities comprising Mortgagor and of the
Property; and
(z) (A) no person, together with its affiliates, shall acquire more
than a twenty-two percent (22%) direct and/or indirect interest in either
or both of the entities comprising Mortgagor without Mortgagee's prior
written consent and (B) no person, together with its affiliates, shall
acquire more than a forty-nine percent (49%) direct and/or indirect
interest in either or both of the entities comprising Mortgagor without
both (1) Mortgagee's prior written consent and (II) if required under the
operative documents with respect to a Secondary Market Transaction (as
hereinafter defined), Mortgagee shall have received evidence in writing
from the Rating Agency to the effect that the proposed transfer will not
result in a re-qualification, reduction, downgrade or withdrawal of any
rating initially assigned or to be assigned in a Secondary Market
Transaction or, if no such rating has been issued, in Mortgagee's good
faith judgment, such transfer shall not have an adverse effect on the level
of rating obtainable in connection with the loan secured hereby.
In all cases where assignment of ownership interests is allowed pursuant to
this Section 1.13 (a), the proportionate ownership which is proposed to be
transferred shall be calculated so as to take into account prior transfers
or assignments. Furthermore, the sale, conveyance, transfer, disposition,
alienation, hypothecation, pledge or encumbering (whether voluntarily or
involuntarily) of all or any portion of the ownership interest in (or,
directly or indirectly through constituent parties, any of the ultimate
beneficial ownership interest in) any guarantor of Mortgagor's obligation
hereunder or under any of the other Loan Documents shall constitute a
default hereunder and Mortgagee shall have the right to exercise its
various remedies described hereinabove; provided, however, ownership
interests in any such guarantor may be transferred in a manner consistent
with the allowable transfers of ownership interests in Mortgagor described
hereinabove.
(b) Notwithstanding the foregoing provisions of this Section, Mortgagee
shall consent to a sale, conveyance or transfer of the Property in its
entirety (hereinafter, a "Sale") to any person or entity provided that each
of the following terms and conditions are satisfied (by way of
clarification, transfers permitted under Section 1.13(a) above are not
subject to the requirement of this Section 1.13(b)):
(1) No defaults then continuing hereunder or under any of the other
Loan Documents;
(2) Mortgagor gives Mortgagee written notice of the terms of such
prospective Sale not less than forty-five (45) days before the date on
which such Sale is scheduled to close and, concurrently therewith, gives
Mortgagee all reasonable information concerning the proposed transferee of
the Property (hereinafter, a "Buyer") as Mortgagee would require in
evaluating an initial extension of credit to a borrower and pays to the
Mortgagee a non-refundable application fee in the amount of $5,000.00 (the
"Application Fee"). Mortgagee shall have the right, in its reasonable
discretion, to approve or disapprove the proposed Buyer. In determining
whether to give or withhold its approval of the proposed Buyer, Mortgagee
shall consider, among other things, the Buyer's experience and track record
in owning and operating facilities similar to the Property, the Buyer's
entity structure, the Buyer's financial strength, the Buyer's general
business standing and the Buyer's relationships and experience with
contractors, vendors, tenants, lenders and other business entities;
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(3) Morgagor pays Mortgagee, concurrently with the closing of such
Sale, a non-refundable assumption fee (the "Assumption fee") in an amount
equal to one quarter of one percent (1/4%) of the then outstanding
principal balance of the Note. The Application Fee shall be used to pay
Mortgagee's reasonable and customary out-of-pocket costs and expenses,
including, without limitation, reasonable attorneys fees incurred by
Mortgagee in connection with the Sales. Mortgagor's obligation to pay such
out-of-picket costs and expenses and attorneys fees of Mortgagee in
connection with such Sale shall not exceed the Application Fee;
(4) The Buyer assumes and agrees to pay the indebtedness secured
hereby subject to the provisions of Section 4.23 hereof and to perform the
covenants of Mortgagor under the Loan Documents, and, prior to or
concurrently with the closing of such Sale, the Buyer executes, without any
cost or expense to Mortgagee, such documents and agreements as Mortgagee
shall reasonable require to evidence and effectuate said assumption and
delivers such legal opinions as Mortgagee may require;
(5) Mortgagor and the Buyer execute, without any cost or expense to
Mortgagee, new financing statements or financing statement amendments and
any additional documents reasonably requested by Mortgagee;
(6) Mortgagor delivers to Mortgagee, without any cost or expense to
Mortgagee, such endorsements to Mortgagee's Title Insurance Policy, hazard
insurance endoresments or certificates and other similar materials as
Mortgagee may deem necessary at the time of the Sale, all in form and
substance satisfactory to Mortgagee, including, without limitation, an
endorsement or endorsements to Mortgagee's Title Insurance Policy insuring
the lien of this mortgage, extending the effective date of such policy to
the date of execution and delivery (or, if late, of recording) of the
assumption agreement referenced above in subparagraph (4) of this Section
1.13(b) with no additional exceptions added to such policy and insuring
that fee simple title to the Property is vested in the Buyer;
(7) Mortgagor executes and delivers to Mortgagee, without any cost or
expense to Mortgagee, a, release of Mortgagee, its officers, directors,
employees and agents, from all claims and liability relating to the
transactions evidenced by the Loan Documents through and including the date
of the closing of the Sale, which agreement shall be in form and substance
satisfactory to Mortgagee and shall be binding upon the Buyer;
(8) Subject to the provisions of Section 4.23 hereof, such Sale is not
construed so as to relieve Mortgagor of any personal liability under the
Note or any of the other Loan Documents for any acts or events occurring or
obligations arising prior to or simultaneously with the closing of such
Sale and Mortgagor executes, without any cost or expense to the Mortgagee,
such documents and agreements as Mortgagee shall reasonable require to
evidence and effectuate the ratification of said personal liability.
-27-
(9) Such Sale is not construed so as to relieve any current guarantor
or indemnitor of its obligations under any guaranty or indemnity agreement
executed in connection with the loan secured hereby and each such current
guarantor and indemnitor executes, without any cost or expense to
Mortgagee, such documents and agreements as Mortgagee shall reasonably
require to evidence and effectuate the ratification of each such guaranty
and indemnity agreement, provided that if the Buyer or a party associated
with the Buyer approved by Mortgagee in its sole discretion assumes the
obligations of the current guarantor or indemnitor under its guaranty or
indemnity agreement and the Buyer or such party associated with the Buyer,
as applicable, executes, without any cost or expense to Mortgagee, a new
guaranty or indemnity agreement in form and substance satisfactory to
Mortgagee, then Mortgagee shall released the current guarantor or
indemnitor from all obligations arising under its guaranty or indemnity
agreement after the closing of such Sale;
(10) The Buyer shall furnish, if the Buyer is a corporation,
partnership or other entity, all documents evidencing the Buyer's capacity
and good standing, and the qualification of the signets to execute the
assumption of the indebtedness secured hereby, which documents shall
include; but not in any way be limited to, certified copies of all
documents relating to the organization and formation of the Buyer and of
the entities, if any, which are partners or members of the Buyer. The Buyer
and such constituent partners, members or shareholders of Buyer (as the
case may be), as Mortgagee may require, shall be single-purpose,
single-asset "bankruptcy remote" entities, whose formation documents shall
be approved by counsel to Mortgagee;
(11) The Buyer, if required by Mortgagee, shall finish an opinion of
counsel satisfactory to Mortgagee and its counsel (i) that the Buyer's
formation documents provide for the matters described in subparagraph (10)
of this Section 1,13(b), (ii) that the assumption of the indebtedness
evidenced hereby has been duly authorized, executed and delivered, and that
the Loan Documents are valid, binding and enforceable against the Buyer in
accordance with their terms, (iii) that the Buyer and any entity which is a
controlling stockholder, member or general partner of Buyer, have been duly
organized, and are in existence and good standing, and (iv) with respect to
such other matters, as Mortgagee may request;
(12) If the Buyer is a single-member limited liability company, Buyer
must be formed in the state of Delaware, and the Buyer's operating
agreement must provide for the continued existence of the Buyer in the
event of the bankruptcy or dissolution of the sole member. The Buyer, if
required by Mortgagee, shall also furnish an opinion of counsel
satisfactory to Mortgagee and its counsel that if the Buyer is a
single-member limited liability company, that (i) the Buyer is a separate
legal entity formed in the state of Delaware, (ii) that the separate
existence of the Buyer shall continue until the cancellation of the
certificate of organization, (iii) that
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the Buyer's operating agreement provides for the continued existence of the
Buyer in the event of the bankruptcy or dissolution of the sole member, and
that such provisions would be enforceable notwithstanding the bankruptcy of
the sole member, and (iv) that any judgment creditor of the sole member may
not satisfy its claims against the sole member by asserting a claim against
the Property or any other assets of the Buyer;
(13) If required under the operative documents with respect to a
Secondary Market Transaction (as hereinafter defined), Mortgagee shall have
received evidence in writing from the Rating Agency to the effect that the
proposed transfer will not result in a re-qualification, reduction,
downgrade or withdrawal of any rating initially assigned or to be assigned
in a Secondary Market Transaction (as hereinafter defined) or, if no such
rating has been issued, in Mortgagee's good faith judgment, such transfer
shall not have an, adverse effect on the level of rating obtainable in
connection with the loan secured hereby; and
(14) Mortgagor's obligations under the contract of sale pursuant to
which such Sale, conveyance or transfer is proposed to occur tall expressly
be subject to the satisfaction of the terms and conditions of this Section
1.13(b).
1.14. Payment of Utilities, Assessments. Charges, Etc. Mortgagor shall pay
when due all utility charges which axe incurred by Mortgagor or which may become
a charge or lien against any portion of the Property for gas, electricity, water
and sewer services furnished to the Real Estate and/or the Improvements and all
other assessments or charges of a similar nature, or assessments payable
pursuant to any restrictive covenants, whether public or private, affecting the
Real Estate and/or the Improvements or any portion thereof, whether or not such
assessments or charges are or may become liens thereon.
1.15. Access Privileges and Inspections. Mortgagee and the agents,
representatives and employees of Mortgagee shall, subject to the rights of
tenants, have fall and free access to the Real Estate and the Improvements and
any other-location where books and records concerning the Property are kept at
all reasonable times and upon reasonable notice for the purposes of inspecting
the Property and of examining, copying and making extracts from the books and
records of Mortgagor relating to the Property. Mortgagor shall lend assistance
to all such agents, representatives and employees of Mortgagee.
1.16. Waste; Alteration of the Property. Mortgagor shall not commit, suffer
or permit any waste on the Property nor take any actions that might invalidate
any insurance carried on the Property. Mortgagor shall maintain the Property in
good condition, and repair. No part of the Improvements may be removed,
demolished or materially altered, without the prior written consent of
Mortgagee. Without the prior written consent of Mortgagee, Mortgagor shall not
commence construction of any improvements on the Real Estate other than
improvements required for the maintenance or repair of the Property.
1.17. Zoning; Use. Without the prior written consent of Mortgaged,
Mortgagor shall not seek, make, suffer, consent to or acquiesce in any change in
the zoning or conditions of use of the Real Estate or the Improvements.
Mortgagor shall comply with and make all payments required under the provisions
of any covenants, conditions or restrictions affecting the Real
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Estate or the Improvements. Mortgagor shall comply with all existing and future
requirements of all governmental authorities having jurisdiction over the
Property. Mortgagor shall keep all licenses, permits, franchises, certificates
of occupancy, consents, and other approvals necessary for the operation of the
Property in full force and effect. Mortgagor shall operate the Property as a
retail shopping center for so long as the indebtedness secured hereby is
outstanding. If, under applicable zoning provisions, the use of all or any part
of the Real Estate or the Improvements is or becomes a nonconforming use,
Mortgagor shall not cause or permit such use to be discontinued or abandoned
without the prior written consent of Mortgagee. Further, without Mortgagee's
prior written consent, Mortgagor shall not file or subject any part of the Real
Estate or the Improvements to any declaration of condominium or cooperative or
convert any part of the Real Estate or the Improvements to a condominium,
cooperative or other form of multiple ownership and governance.
1.18. Financial Statements and Books and Records. Mortgagor shall keep
accurate books and records of account of the Property and its own financial
affairs sufficient to permit the preparation of financial statements therefrom
in accordance with generally accepted accounting principles. Mortgagee and its
duly authorized representatives shall have the right to examine, copy and audit
Mortgagor's records and books of account at all reasonable times and upon
reasonable notice. So long as this Mortgage continues in effect, Mortgagor shall
provide to Mortgagee, in addition to any other financial statements required
hereunder or under any of the other Loan Documents, the following financial
statements and information, all of which must be certified to Mortgagee as being
true and correct by Mortgagor or the entity to which they pertain, as
applicable, be prepared in accordance with generally accepted accounting
principles consistently applied and be in form and substance acceptable to
Mortgagee:
(a) copies of all tax returns filed by Mortgagor, within thirty (30) days
after the date of filing;
(b) quarterly operating statements for the Property, within fifteen (15)
days after the end of each March, June, September and December;
(c) current rent rolls for the Property, within fifteen (15) days after the
end of
(d) annual balance sheets for the Property and annual financial statements
for Mortgagor, each principal or general partner in Mortgagor, and each
indenmitor and guarantor under any indemnity or guaranty executed in connection
with the loan secured hereby within ninety (90) days after the end of each
calendar year; and
(e) such other information with respect to the Property, Mortgagor, the
principals, members or general partners in Mortgagor, and each indenmitor and
guarantor under any indemnity or guaranty executed in connection with the loan
secured hereby, which may be reasonably requested from time to time by
Mortgagee, within a reasonable time after the applicable request.
If any of the aforementioned materials are not furnished to Mortgagee within the
applicable time periods, Mortgagor shall pay to Mortgagee a late fee of $250.00.
Further, if any of the
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aforementioned materials are not furnished to Mortgagee within the applicable
time periods set forth above and thereafter within an additional fifteen (15)
days after written request by Mortgagee, or if Mortgagee is dissatisfied with
the contents of any of the foregoing, in addition to any other rights and
remedies of Mortgagee contained herein, Mortgagee shall have the right, but not
the obligation, to obtain the same by means of an audit by an independent
certified public accountant selected by Mortgagee, in which event Mortgagor
agrees to pay, or to reimburse Mortgagee for, any expense of such audit and
further agrees to provide all necessary information to said accountant and to
otherwise cooperate in the making of such audit. Mortgagor agrees that any and
all materials furnished hereunder are the property of Mortgagee (and Mortgagee's
servicer) and may be released and made available to such parties as Mortgagee or
its servicer deems appropriate, including any Rating Agency responsible for
rating securities issued in any Secondary Market Transaction (as hereinafter
defined).
1.19. Further Documentation. Mortgagor shall, on the request of Mortgagee
in its reasonable discretion and at the expense of Mortgagor, promptly correct
any defect, error or omission which may be discovered in the contents of this
Mortgage or in any of the other Loan Documents and promptly execute,
acknowledge, deliver and record or file such further instruments and do such
further acts as may be necessary, desirable or proper to carry out more
effectively the purposes of this Mortgage and the other Loan Documents or as I
ray be deemed advisable by Mortgagee to protect, continue or preserve the liens
and security interests hereunder including, without limitation, security
instruments, financing statements and continuation statements.
1.20. (a) Payment of Costs. Mortgagor shall pay all reasonable costs and
expenses of every character incurred in connection with the closing of the Loan
or otherwise attributable or chargeable to Mortgagor as the owner of the
Property, including, without limitation, appraisal fees, recording fees,
documentary, stamp, mortgage or intangible taxes, brokerage fees and
commissions, title policy premiums and title search fees, uniform commercial
code/tax hen/litigation search fees, escrow fees and reasonable attorneys fees.
(b) Advances to protect Property: Without limiting or waiving any
other rights and remedies of Mortgagee hereunder, if Mortgagee reasonably
determines that Mortgagor is not adequately performing or has failed to perform
any of its obligations,. covenants or agreements contained in this Mortgage or
in any of the other Loan Documents and such inadequacy or failure is riot cured
within any applicable grace or cure period, or if any action or proceeding of
any kind (including, but not limited to, any bankruptcy, insolvency,
arrangement, reorganization or other debtor relief proceeding) is commenced
which might affect Mortgagee's interest in the Property or Mortgagee's right to
enforce its security, then Mortgagee may, at its option, with or without notice
to Mortgagor, make any appearances, disburse or advance any sums and take any
actions as may be necessary or desirable to protect or enforce the security of
this Mortgage or to remedy the failure of Mortgagor to perform its covenants and
agreements (without, however, waiving any default of Mortgagor). Mortgagor
agrees to pay on demand all expenses of Mortgagee reasonably incurred with
respect to the foregoing (including, but not limited to, fees and disbursements
of counsel), together with interest thereon at the Default Interest Rate (as
defined in the Note) from and after the date on which Mortgagee incurs such
expenses until reimbursement thereof by Mortgagor. Any such expenses so incurred
by Mortgagee, together with interest thereon as provided above, shall be
additional indebtedness of
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Mortgagor secured by this Mortgage and by all of the other Loan Documents
securing all or any part of the indebtedness evidenced by the Note. The
necessity for any such actions and of the amounts to be paid shall be determined
by Mortgagee in its sole and absolute discretion. Mortgagee is hereby empowered
to enter and to authorize others to enter upon the Property or any part thereof
for the purpose of performing or observing any such defaulted term, covenant or
condition without thereby becoming liable to Mortgagor or any person in
possession holding under Mortgagor. Mortgagor hereby acknowledges and agrees
that the remedies set forth in this Section 1.20(b) shall be exercisable by
Mortgagee, and any and all payments made or costs or expenses incurred by
Mortgagee in connection therewith shall be secured hereby and shall be, without
demand, immediately repaid by Mortgagor with interest thereon at the Default
Interest Rate (as defined in the Note), notwithstanding the fact that such
remedies were exercised and such payments made and costs incurred by Mortgagee
after the filing by Mortgagor of a voluntary case or the filing against
Mortgagor of an involuntary case pursuant to or within the meaning of the
Bankruptcy Reform Act of 1978, as amended (the "Act"), Title 11 U.S.C., or after
any similar action pursuant to any other debtor relief law (whether statutory,
common law, case law or otherwise) of any jurisdiction whatsoever, now or
hereafter in effect, which may be or become applicable to Mortgagor, Mortgagee,
any guarantor or indemnitor, the secured indebtedness or any of the Loan
Documents, This indemnity shall survive payment in full of the indebtedness
secured hereby. This Section 1.20(b) shall not be construed to require Mortgagee
to incur any expenses, make any appearances or take any actions.
1.21. Security Interest. This Mortgage is also intended to encumber and
create a security interest in, and Mortgagor hereby grants to Mortgagee a
security interest in, all Reserves (as hereinabove defined), fixtures, chattels,
accounts, equipment, inventory, contract rights, general intangibles and other
personal property included within the Property, all renewals, replacements of
any of the aforementioned items, or articles in substitution therefor or in
addition thereto or the proceeds thereof (said property is hereinafter referred
to collectively as the "Collateral"), whether or not the same shall be attached
to the Real Estate or the Improvements in any manner. It is hereby agreed that
to the extent permitted by law, all of the foregoing property is to be deemed
and held to be a part of and affixed to the Real Estate and the Improvements.
The foregoing security interest shall also cover Mortgagor's leasehold interest
in any of the foregoing property which is leased by Mortgagor. Notwithstanding
the foregoing, all of the foregoing property shall be owned by Mortgagor and no
leasing or installment sales or other financing or title retention agreement in
connection therewith shall be permitted without the prior written approval of
Mortgagee. Mortgagor shall promptly replace all of the Collateral subject to the
lien or security interest of this Mortgage when worn out or obsolete with
Collateral comparable to the worn out or obsolete Collateral when new and will
not, without the prior written consent of Mortgagee, remove from the Real Estate
or the Improvements any of the Collateral subject to the lien or security
interest of this Mortgage except such as is replaced by an article of equal
suitability and value as above provided, owned by Mortgagor free and clear of
any lien or security interest except that created by this Mortgage and the other
Loan Documents and except as otherwise expressly permitted by the terms of
Section 1.13 of this Mortgage. All of the Collateral shall be kept at the
location of the Real Estate except as otherwise required by the terms of the
Loan Documents. Mortgagor shall not use any of the Collateral in violation of
any applicable statute, ordinance or insurance policy.
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1.22. Security Agreement. This Mortgage constitutes a mortgage and a
"security agreement" between Mortgagor and Mortgagee with respect to the
Collateral in which Mortgagee is granted a security interest hereunder, and,
cumulative of all other rights and remedies of Mortgagee hereunder, Mortgagee
shall have all of the rights and remedies of a secured party tinder any
applicable Uniform Commercial Code. Mortgagor hereby agrees to execute and
deliver on demand and hereby irrevocably constitutes and appoints Mortgagee the
attorney-in fact of Mortgagor to execute and deliver and, if appropriate, to
file with the appropriate filing officer or office such security agreements,
financing statements, continuation statements or other instruments as Mortgagee
may request or require in order to impose, perfect or continue the perfection of
the lien or security interest created hereby. Expenses of retaking, holding,
preparing for sale, selling or the like (including, without limitation,
Mortgagee's reasonable attorneys' fees and legal expenses), together with
interest thereon at the Default Interest Rate from the date incurred by
Mortgagee until actually paid by Mortgagor, shall be paid by Mortgagor on demand
and shall be secured by this Mortgage and by all of the other Loan Documents
securing all or any part of the indebtedness evidenced by the Note. If notice is
required by law, Mortgagee shall give Mortgagor at least ten (10) days prior
written notice of the time and place of any public sale of such property or of
the time of or after which any private sale or any other intended disposition
thereof is to be made, and if such notice is sent to Mortgagor, as the same is
provided for the mailing of notices herein, it is hereby deemed that such notice
shall be and is reasonable notice to Mortgagor. No such notice is necessary for
any such property which is perishable, threatens to decline speedily in value or
is of a type customarily sold on a recognized market. Any sale made pursuant to
the provisions of this Section 1.22 shall be deemed to have been a public sale
conducted in a commercially reasonable manner if held contemporaneously with the
foreclosure sale as provided in Section 3.1(e) hereof upon giving the same
notice with respect to the sale of the property hereunder as is required under
said Section 3.1(e). Furthermore, to the extent permitted by law, in conjunction
with, in addition to or in substitution for the rights and remedies available to
Mortgagee pursuant to any applicable Uniform Commercial Code:
(a) hi the event of a foreclosure sale, the Property may, at the
option of Mortgagee, be sold as a whole; and
It shall not be necessary that Mortgagee take possession of the
aforementioned Collateral, or any part thereof, prior to the time that any safe
pursuant to the provisions of this Section 1.22 is conducted and it shall not be
necessary that said Collateral, or any part thereof, be present at the location
of such sale; and
(c) Mortgagee may appoint or delegate any one or more persons as agent
to perform any act or acts necessary or incident to any sale held by Mortgagee,
including the sending of notices and the conduct of the sale, but in the name
and on behalf of Mortgagee.
Mortgagor will not change the principal place of business or chief
executive office set forth below, or change the state of its organization or
registration, or change its name, without in each instance the prior written
consent of Mortgagee, which consent shall not be unreasonably withheld, delayed
or conditioned. Mortgagee's consent will, however, be conditioned upon, among
other things, the execution and delivery(,) of additional- financing statements,
security agreements and other instruments which may be necessary to effectively
evidence or perfect
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Mortgagee's security interest in the Collateral as a result of such changes. The
name, principal pla of business and chief executive office of Mortgagor (as
Debtor under any applicable Uniform Commercial Code), as of the date hereof,
are:
Xxxx Xxxxxxxx Xxxx, X.X.
c/o Thor Equities, LLC
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxx and Xxxx Xxxxx
Xxxx Xxxxxxxx Hill H, L.P.
c/o Thor Equities, LLC
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxx and Xxxx Xxxxx,
The name and address of Mortgagee (as Secured Party under any applicable Uniform
Commercial Code), as of the date hereof, are:
Column Financial, Inc.
Eleven Xxxxxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Xxxxxx Xxxxxx.
1.23. Easements and Rights-of-Way. Mortgagor shall not grant any easement
or right of-way with respect to all or any portion of the Real Estate or the
Improvements without the prior written consent of Mortgagee, which shall not be
unreasonably withheld. The purchaser at any foreclosure sale hereunder may, at
its discretion, disaffirm any easement or right-of-way granted in violation of
any of the provisions of this Mortgage and may take immediate possession of the
Property free from, and despite the terms of, such grant of easement or right-of
way. If Mortgagee consents to the grant of an easement or right-of-way,
Mortgagee agrees to grant such consent without charge to Mortgagor other than
reasonable expenses, including, without limitation, reasonable attorneys' fees,
incurred by Mortgagee in the review of Mortgagor's request and, if applicable,
in the preparation of documents relating to the subordination of this Mortgage
to such easement or right-of-way.
1.24. Compliance with Laws. (a) Mortgagor shall at all times comply with
all statutes, ordinances, regulations and other governmental or
quasi-governmental requirements and private covenants now or hereafter relating
to the ownership, construction, use or operation of the Property, including, but
not limited to, those concerning employment and compensation of persons engaged
in operation and maintenance bf the Property and any environmental or ecological
requirements, even if such compliance shall require structural changes to the
Property; provided, however, that Mortgagor may, upon providing Mortgagee with
security satisfactory to Mortgagee, proceed diligently. and in good faith to
contest the validity or applicability of any
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such statute, ordinance, regulation or requirement so long as during such
contest the Property shall not be subject to any lien, charge, fine or other
liability and shall not be in danger of being forfeited, lost or closed.
Mortgagor shall not use or occupy, or allow the use or occupancy of, the
Property in any manner which violates any lease of or any other agreement
applicable to the Property or any applicable law, rule, regulation or order or
which constitutes a public or private nuisance or which makes void, voidable or
cancelable, or increases the premium of, any insurance then in force with
respect thereto.
(b) Mortgagor agrees that the Property shall at all times comply to
the extent applicable with the requirements of the Americans with Disabilities
Act of 1990, the Fair Housing Amendments Act of 1988 and all other state and
local laws and ordinances related to handicapped access and all rules,
regulations,, and orders issued pursuant thereto including, without limitation,
the Americans with Disabilities Act Accessibility Guidelines for Buildings and
Facilities ("Access Laws"). Mortgagor agrees to give prompt notice to Mortgagee
of the receipt by Mortgagor of any complaints related to violations of any
Access Laws and of the commencement of any proceedings or investigations which
relate to compliance with applicable Access Laws.
1.25. Additional Taxes. In the event of the enactment after this date of
any law of the state where the Property is located or of any other governmental
entity deducting from the value of the Property for the purpose of taxation any
lien or security interest thereon, or imposing upon Mortgagee the payment of the
whole or any part of the taxes or assessments or charges or liens herein
required to be paid by Mortgagor, or changing in any way the laws relating to
the taxation of mortgages or security agreements or debts secured by mortgages
or security agreements or the interest of the mortgagee or secured party in the
property covered thereby, or the manner of collection of such taxes, so as to
adversely affect this Mortgage or the indebtedness secured hereby or Mortgagee,
then, and in any such event, Mortgagor, upon demand by Mortgagee, shall pay such
taxes, assessments, charges or liens, or reimburse Mortgagee therefor; provided,
however, that if in the opinion of counsel for Mortgagee (a) it might be
unlawful to require Mortgagor to make such payment, or (b) the making of such
payment might result in the imposition of interest beyond the maximum amount
permitted by law, then and in either such event, Mortgagee may elect, by notice
in writing given to Mortgagor, to declare all of the indebtedness secured
hereby to be and become due and payable in full, thirty (30) days from the
giving of such notice.
1.26. Mortgagor's Waivers. To the full extent permitted by law, Mortgagor
agrees that Mortgagor shall not at any time insist upon, plead, claim or take
the benefit or advantage of any law now or hereafter in force providing for any
appraisement, valuation, stay, moratorium or extension, or any law now or
hereafter in force providing for the reinstatement of the indebtedness secured
hereby prior to any sale of the Property to be made pursuant to any provisions
contained herein or prior to the entering of any decree, judgment or order of
any court of competent jurisdiction, or any right under any statute to redeem
all or any part of the Property so sold. To the full extent permitted by law,
Mortgagor shall not have or assert any right under any statute or rule of law
pertaining to the exemption of homestead or other exemption under any federal,
state or local law now or hereafter in effect, the administration of estates of
decedents or, any other matters whatsoever to defeat, reduce or affect the right
of Mortgagee under the terms of this Mortgage to a sale of the Property, for the
collection of the secured indebtedness without
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any nor or different resort for collection, or the right of Mortgagee under the
terms of this M gage to the payment of the indebtedness secured hereby out of
the proceeds of sale of the Property in preference to every other claimant
whatever. Mortgagor, for Mortgagor and Mortgagor's successors and assigns, and
for any and all persons ever claiming any interest in the Property, to the full
extent permitted by law, hereby knowingly, intentionally and voluntarily with
and upon the advice of competent counsel waives, releases, relinquishes and
forever forgoes: (a) all rights of valuation, appraisement, stay of execution,
reinstatement and notice of election or intention to mature or declare due the
secured indebtedness (except such notices as are specifically provided for
herein); (b) all right to a marshaling of the assets of Mortgagor, including the
Property, to a sale in the inverse order of alienation, or to direct the order
in which any of the Property shall be sold in the event of foreclosure of the
liens and security interests hereby created and agrees that any court having
jurisdiction to foreclose such hens and security interests may order the
Property sold as an entirety; (c) all rights and periods of redemption provided
under applicable law; and (d) all present and future statutes of limitations as
a defense to any action to enforce the provisions of this Mortgage or to collect
any of the indebtedness secured hereby to the fullest extent permitted by law
and agrees that it shall not solicit or aid the solicitation of the filing of
any Petition (as hereinafter defined) against Mortgagor, whether acting on its
own behalf or on behalf of any other party. Without limiting the generality of
the foregoing, Mortgagor shall not (i) provide information regarding the
identity of creditors or the nature of creditors claims to any third party
unless compelled to do so by order of a court of competent jurisdiction or by
regulation promulgated by a governmental agency; or (ii) pay the legal fees or
expenses of any creditor of or interest holder in Mortgagor with respect to any
matter whatsoever.
1.27. SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL.
(a) MORTGAGOR, TO 'I HJ,' FULL EXTENT PERMITTED BY LAW, HEREBY
KNOWINGLY, INTENTIONALLY AND VOLUNTARILY, WITH AND UPON THE ADVICE OF COMPETENT
COUNSEL, (z) SUBMTTS TO PERSONAL JURISDICTION IN THE COMMONWEALTH OF
PENNSYLVANIA OVER ANY SUIT, ACTION OR PROCEEDING BY ANY PERSON ARISING FROM OR
RELATING TO THE NOTE, THIS MORTGAGE OR ANY OTHER OF THE LOAN DOCUMENTS, (I3)
AGREES THAT ANY SUCH ACTION, SUIT OR PROCEEDING. MAY BE BROUGHT IN ANY STATE OR
FEDERAL COURT OF COMPETENT JURISDICTION SITTING IN PHILADELPHIA COUNTY,
PENNSYLVANIA, (iii) SUBMITS TO THE JURISDICTION OF SUCH COURTS, AND, (IV) AGREES
THAT IT WILL NOT BRING ANY ACTION, SUIT OR PROCEEDING IN ANY OTHER FORUM (BUT
NOTHING HEREIN SHALL AFFECT THE RIGHT OF MORTGAGEE TO BRING ANY ACTION, SUIT OR
PROCEEDING IN ANY OTHER FORUM). MORTGAGOR, TO THE FULL EXTENT PERMITTED BY LAW,
FURTHER CONSENTS AND AGREES TO SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER I.FGAL
PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING BY REGISTERED OR CERTIFIED U.S.
MAIL, POSTAGE PREPAID, TO MORTGAGOR AT THE ADDRESS FOR NOTICES DESCRIBED IN
SECTION 4.4 HEREOF, AND CONSENTS AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE
IN EVERY RESPECT VALID AND EFFECTIVE SERVICE (BUT NOTHING HEREIN SHALL AFFECT
THE
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VALIDITY OR EFFECTIVENESS OF PROCESS SERVED IN ANY OTHER MANNER PERATTED BY
LAW).
(b) MORTGAGOR, TO THE FULL EXTENT PERMITTED BY LAW, HEREBY KNOWINGLY,
INTENTIONALLY AND VOLUNTARILY, WITH AND UPON TJTE ADVICE OF COMPETENT COUNSEL,
WAIVES, RELINQUISHES AND FOREVER FORGOES THE RIGHT TO A TRIAL BY JURY IN ANY
ACTION OR PROCEEDING BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATING TO THE
INDEBTEDNESS SECURED HEREBY OR ANY CONDUCT, ACT OR OMISSION OF MORTGAGEE OR
MORTGAGOR, OR ANY OF THEIR DIRECTORS, OFFICERS, PARTNERS, MANAGERS, MEMBERS,
EMPLOYEES, AGENTS OR ATTORNEYS, OR ANY OTHER PERSONS AFFILIATED WITH MORTGAGEE
OR MORTGAGOR, IN EACH OF THE FOREGOING CASES, WHETHER SOUNDING IN CONTRACT, TORT
OR OTHERWISE.
1.28. Contractual Statute of Limitations. Mortgagor hereby agrees that any
claim or cause of action by Mortgagor against Mortgagee, or any of Mortgagee's
directors, officers, employees, agents, accountants or attorneys, based upon,
arising from or relating to the indebtedness secured hereby, or any other
matter, cause or thing whatsoever, whether or not relating thereto, occurred,
done, omitted or suffered to be done by Mortgagee or by Mortgagee's directors,
officers, employees, agents, accountants or attorneys, whether sounding in
contract or in tort or otherwise, shall be barred unless asserted by Mortgagor
by the commencement of an action or proceeding in a court of competent
jurisdiction by the filing of a complaint within one (1) year after Mortgagor
first acquires or reasonably should have acquired knowledge of the first act,
occurrence or omission upon- which such claim or cause of action, or any part
thereof, is based and service of a summons and complaint on an officer of
Mortgagee or any other person authorized to accept service of process on behalf
of Mortgagee, within thirty (30) days thereafter. Mortgagor. agrees that such
one (1) year period of time is reasonable and sufficient time for a borrower to
investigate and act upon any such claim or cause of action. The one (1) year
period provided herein shall not be waived, tolled or extended except by the
specific written agreement of Mortgagee. This provision shall survive any
termination of this Mortgage or any of the other Loan Documents.
1.29. Management. The management of the Property shall be by either: (a)
Mortgagor or an entity affiliated with Mortgagor approved by Mortgagee for so
long as Mortgagor or said affiliated entity is managing the Property in a first
class manner; or (b) a professional property management company approved by
Mortgagee. Such management by an affiliated entity or a professional property
management. company shall be pursuant to a written agreement approved by
Mortgagee. Thor Equities LLC has been approved by Mortgagee as an acceptable
property manager and the Asset Management Agreement dated on or about the date
hereof between Thor Equities, LLC has been approved by Mortgagee. In no event
shall any manager be removed or replaced or the terms of any management
agreement modified or amended without the prior written consent of Mortgagee. In
the event of default hereunder or under any management contract then in effect,
which default is not cured within any applicable grace or cure period, Mortgagee
shall have the right to terminate, or to direct Mortgagor to terminate, such
management contract upon thirty (30) days' notice and to retain, or to direct
Mortgagor to retain, a new management agent approved by Mortgagee. All Rents and
Profits generated by or derived
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From the Property shall first be utilized solely for current expenses directly
attributable to the own hip and operation of the Property, including, without
limitation, current expenses relating to Mortgagor's liabilities and obligations
with respect to this Mortgage and the other Loan Documents, and none of the
Rents and Profits generated by or derived from the Property shall be diverted by
Mortgagor and utilized for any other purposes unless all such current expenses
attributable to the ownership and operation of the Property have been fully paid
and satisfied.
1.30. Hazardous Materials and Environmental Concerns.
(a) Mortgagor hereby represents and warrants to Mortgagee, after due
inquiry and investigation, that, as of the date hereof, except as disclosed iii
that certain Phase I Environmental Site Assessment prepared by ConTech Services,
Inc. dated April 24, 2003 and that certain review of same prepared by Certified
Environments, Inc. and dated May 1, 2003 (the foregoing are, collectively, the
"Environmental Report"): (1) the Property is in full compliance with, and to the
best of Mortgagor's knowledge, information and belief, the Property has been in
full compliance with all local, state or federal laws, rules and regulations
pertaining to environmental regulation, contamination, remediation or human
health or safety (including the regulation or remediation of Hazardous
Substances as defined below) (collectively, "Environmental Laws"), all as
amended; (ii) no hazardous, toxic or harmful substances, wastes, materials,
pollutants or contaminants (including, without limitation, asbestos,
polychlorinated biphenyls, petroleum products, radon, lead-based paint,
flammable explosives, radioactive materials, infectious substances or raw
materials which may include hazardous constituents) or any other substances or
materials which are included under or regulated by Environmental Laws
(collectively, "Hazardous Substances") are located on or have been handled,
manufactured, generated, stored, processed, transported to or from, or disposed
of on or Released or discharged from the Property (including soil and
groundwater beneath the Property) except for those substances used by Mortgagor
in the ordinary course of its business and in compliance with all Environmental
Laws; (iii) the Property is not subject to any private or governmental lien or
judicial, administrative or other notice or action relating to Hazardous
Substances or noncompliance with Environmental Laws, nor is Mortgagor aware of
any basis for such lien,(,) notice or action; (iv) there are no underground
storage tanks or other underground storage receptacles (whether active or
abandoned) used to store Hazardous Substances on the Property; (v) Mortgagor has
received no notice of, and to the best of Mortgagor's knowledge and belief,
there does not exist any investigation, action, proceeding or claim by any
agency, authority or unit of government or by any third party which could
result in any liability, penalty, sanction or judgment under any Environmental
Laws with respect to any condition, use or operation of the Property, nor does
Mortgagor know of any basis for such investigation, action, proceeding or claim;
(vi) Mortgagor has received no notice that, and to the best of Mortgagor's
knowledge and belief, there has been no claim by any party that, any use,
operation or condition of the Property has caused any nuisance, trespass or any
other liability or adverse condition on any other property, nor does Mortgagor
know of any basis for such notice or claim; and (vii) there are no present
environmental conditions or events or, to the best of Mortgagor's knowledge,
past environmental conditions or events on or near the Property that could be
reasonably anticipated to materially adversely affect the value of the Property.
(b) Mortgagor shall keep or cause the Property to be kept free from
Hazardous Substances (except those substances used by Mortgagor in the ordinary
course of its business and
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in compliance with all Environmental Laws) and in fall compliance with all
Environmental Laws, shall not install or use any underground storage tanks,
shall expressly prohibit the use, generation, handling, storage, production,
processing and disposal of Hazardous Substances by all tenants (except those
substances used by tenants in the ordinary course of their activities and in
compliance with all Environmental Laws), invitees and trespassers, and, without
limiting the generality of the foregoing, during the term of this Mortgage,
shall not install in the Improvements or permit to be installed in the
Improvements asbestos or any substance containing asbestos. If required by
Mortgagee or under any Environmental Law, Mortgagor shall maintain an Operations
and Maintenance Program ("O&M Program") for the management of asbestos,
lead-based paint, radon or any other Hazardous Substances at the Property.
(c) Mortgagor shall promptly notify Mortgagee if Mortgagor shall
become aware of (i) any Release or threatened. Release of Hazardous Substances
at, on, under, from, or affecting or threatening to affect the Property (except
those substances used by Mortgagor or tenants in the ordinary course of their
business or activities, respectively, and in compliance with all Environmental
Laws), (ii) any lien or filing of lien, action or notice affecting or
threatening to affect the Property or Mortgagor resulting from any violation or
alleged violation of Environmental Law, (iii) any investigation, inquiry or
proceeding concerning Mortgagor or the Property pursuant to any Environmental
Law; or otherwise relating to Hazardous Substances, or (iv) any occurrence,
condition or state of facts which would render any representation or warranty in
this Section incorrect in any respect if made at the time of such discovery.
Further, immediately upon receipt of the same, Mortgagor shall deliver to
Mortgagee copies of any and all orders, notices, permits, applications, reports,
and other communications, documents and instruments pertaining to the actual,
alleged or potential non-compliance with any Environmental Laws in connection
with the Property or presence or existence of any Hazardous Substances at, on,
about, under, within, near or in connection with the Property (except those
substances used in the ordinary course of its business and in compliance with
all Environmental Laws). Mortgagor shall, promptly and when and as required, at
Mortgagor's sole cost and expense, take all actions as shall be necessary or
advisable for compliance with the terms of this Section 1.30 or for the
remediation of any and all portions of the Property or other affected property,
including, without limitation, all investigative, monitoring, removal,
containment, remedial and response actions in accordance with all applicable
Environmental Laws (and in all events in a manner satisfactory to Mortgagee),
and shall further pay or cause to be paid, at no expense to Mortgagee, all
remediation, response, administrative and enforcement costs of applicable
governmental agencies which may be asserted against the Property. In the event
Mortgagor fails to do so (i) Mortgagee may, but shall not be obligated to,
undertake rem ediation at the Property or other affected property necessary to
bring the Property into conformance with the terms of Environmental Laws, and
(ii) Mortgagor hereby grants to Mortgagee and its agents and employees access to
the Property and a license to do all things Mortgagee shall deem necessary to
bring the Property into conformance with Environmental Laws. Any and all costs
and expenses reasonably incurred by Mortgagee in connection therewith, together
with interest thereon at the Default Interest Rate from the date incurred by
Mortgagee until actually paid by Mortgagor, shall be immediately paid by
Mortgagor on demand and shall be secured by this Mortgage and by all of the
other Loan Documents securing all or any part of the indebtedness evidenced by
the Note. MORTGAGOR COVENANTS AND AGREES, AT MORTGAGOR'S SOLE COST AND EXPENSE,
TO INDEMNIFY, DEFEND (AT TRIAL AND APPELLATE LEVELS, AND WITH ATTORNEYS,
CONSULTANTS AND
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EXPERTS ACCEPTABLE TO MORTGAGEE), AND HOLD MORTGAGEE HARMLESS FROM AND AGAINST
ANY AND ALL LIENS, DAMAGES, LOSSES, LIABILITIES, OBLIGATIONS, SETTLEMENT
PAYMENTS, PENALTIES, ASSESSMENTS, CITATIONS, DIRECTIVES, CLAIMS, LITIGATION,
DEMANDS, DEFENSES, JUDGMENTS, SUITS, PROCEEDINGS, COSTS, DISBURSEMENTS AND
EXPENSES OF ANY KIND OR OF ANY NATURE WHATSOEVER (INCLUDING, WITHOUT LIMITATION,
REASONABLE ATTORNEYS', CONSULTANTS' AND EXPERTS' FEES AND DISBURSEMENTS ACTUALLY
INCURRED IN INVESTIGATING, DEFENDING, SETTLING OR PROSECUTING ANY CLAIM,
LITIGATION OR PROCEEDING) WHICH MAY AT ANY TIME BE IMPOSED UPON, INCURRED BY OR
ASSERTED OR AWARDED AGAINST MORTGAGEE OR THE PROPERTY, AND ARISING DIRECTLY OR
INDIRECTLY FROM OR OUT OF: (i) THE PRESENCE, RELEASE OR THREAT OF RELEASE OF ANY
HAZARDOUS SUBSTANCES ON, IN, UNDER, AFFECTING OR THREATENING TO AFFECT ALL OR
ANY PORTION OF THE PROPERTY OR ANY SURROUNDING AREAS, REGARDLESS OF WHETHER OR
NOT CAUSED BY OR WITHIN THE CONTROL OF MORTGAGOR; (ii) THE VIOLATION OF ANY
ENVIRONMENTAL LAWS RELATING TO, AFFECTING OR THREATENING TO AFFECT THE PROPERTY,
WHETHER OR NOT CAUSED BY OR WITHIN THE CONTROL OF MORTGAGOR; (iii) THE FAILURE
BY MORTGAGOR TO COMPLY FULLY WITH THE TERMS AND CONDITIONS OF THIS SECTION 1_30;
(iv) THE BREACH OF ANY REPRESENTATION OR WARRANTY CONTAINED IN THIS SECTION
1.30; OR (v) THE ENFORCEMENT OF THIS, SECTION 1.30, INCLUDING, WITHOUT
LIMITATION, THE COST OF ASSESSMENT, CONTAINMENT AND/OR REMOVAL OF ANY AND ALL
HAZARDOUS SUBSTANCES ON AND/OR FROM ALL OR ANY PORTION OF THE PROPERTY OR ANY
SURROUNDING AREAS, THE COST OF ANY ACTIONS TAKEN IN RESPONSE TO THE PRESENCE,
RELEASE OR THREAT OF RELEASE OF ANY HAZARDOUS SUBSTANCES ON, IN, UNDER OR
AFFECTING ANY PORTION OF THE PROPERTY OR ANY SURROUNDING AREAS -TO PREVENT OR
MINIMIZE SUCH RELEASE OR THREAT OF RELEASE SO THAT IT DOES NOT MIGRATE OR
OTHERWISE CAUSE OR THREATEN DANGER TO PRESENT OR FUTURE PUBLIC HEALTH, SAFETY,
WELFARE OR THE ENVIRONMENT, AND COSTS INCURRED TO COMPLY WITH THE ENVIRONMENTAL
LAWS IN CONNECTION WITH ALL OR ANY PORTION OF THE PROPERTY OR ANY SURROUNDING
AREAS. THE INDEMNITY SET FORTH-INN THIS SECTION 1.30(c) SHALL ALSO INCLUDE ANY
DIMINUTION IN THE VALUE OF THE SECURITY AFFORDED BY THE PROPERTY OR ANY FUTURE
REDUCTION IN THE SALES PRICE OF THE PROPERTY BY REASON OF ANY MATTER SET FORTH
IN THIS SECTION 1.30(c), AND ANY AND ALL LIENS, DAMAGES, LOSSES, LIABILITIES,
OBLIGATIONS, SETTLEMENT PAYMENTS, PENALTIES, ASSESSMENTS, CITATIONS, DIRECTIVES,
CLAIMS, LITIGATION, DEMANDS, DEFENSES, JUDGMENTS, SUITS, PROCEEDINGS, COSTS,
DISBURSEMENTS OR EXPENSES OF ANY KIND OR OF ANY NATURE WHATSOEVER ARISING OUT OF
OR RELATING TO INJURY OR DEATH DUE TO EXPOSURE FROM HAZARDOUS SUBSTANCES THAT
MAY BE PRESENT OR RELEASED AT, ON, UNDER OR FROM THE PROPERTY. MORTGAGEE'S
RIGHTS UNDER THIS SECTION SHALL SURVIVE PAYMENT IN FULL OF THE INDEBTEDNESS
SECURED HEREBY AND SHALL BE IN ADDITION TO ALL OTHER RIGHTS OF
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MORTGAGEE UNDER THIS MORTGAGE, THE NOTE AND THE OTHER LOAN DOC ENTS.
(d) Upon Mortgagee's request, at any time after the occurrence of a
default hereunder or at such other time as Mortgagee has reasonable grounds to
believe that Hazardous Substances are or have been handled, generated, stored,
processed, transported to or from, or released or discharged from or disposed of
on or around the Property (other than in the normal course of Mortgagor's or the
tenants' business or activities, respectively, and in compliance with all
Environmental Laws and other than items disclosed in the Environmental Report)
or that Mortgagor, any tenant or the Property may be in violation of
Environmental Laws, Mortgagor shall provide, at Mortgagor's sole cost and
expense, an environmental site assessment or environmental compliance audit of
the Property prepared by a hydrogeologist or environmental engineer or other
appropriate consultant approved by Mortgagee to determine whether there has been
a Release or threatened Release of Hazardous Substances at, on, under or from
the Property onto adjoining properties, and if the Property is in full
compliance with Environmental Laws (including asbestos-containing material or
lead-based paint). If Mortgagor fails to provide such assessment or audit within
thirty (30) days after such request, Mortgagee may order the same, and Mortgagor
hereby grants to Mortgagee and its employees and agents access to the Property
and a license to undertake such assessment or audit. The cost of such assessment
or audit, together with interest thereon at the Default Interest Rate (as
defined in the Note) from the date incurred by Mortgagee until actually paid by
Mortgagor, shall be immediately paid by Mortgagor on demand and shall be secured
by this Mortgage and by all of the other Loan Documents securing all or any part
of the indebtedness evidenced by the. Note.
(e) Without limiting the foregoing, Mortgagee and its authorized
representatives may, during normal business hours and at its own expense,
inspect the Property and Mortgagor's records related thereto for the purpose of
determining compliance with Environmental Laws and the terms and conditions of
this Section 1.30.
(f) As used herein, the term "Release" shall include, without
limitation, any intentional or unintentional placing, spilling, leaking,
pumping, pouring, emitting, emptying, discharging, injecting, escaping,
leaching, dumping, disposing, discarding or abandoning of any Hazardous
Substance.
(g) Prior to any demolition or renovation being performed at the
Property, Mortgagor shall cause a comprehensive survey of asbestos-containing
materials to be conducted by a reputable environmental consultant and shall
follow and observe all recommendations of such consultant with respect to the
handling of such materials.
(h) Mortgagor shall not make and shall not permit any modifications to
be made to that certain Agreement dated April. 29, 1992 made by and between
Mobil Oil corporation ("Mobil") and The Shops Partnership, Ltd. (the "Mobil
Indemnity") without Mortgagee's prior written consent, which consent Mortgagee
shall not unreasonably withhold.
(i) Mortgagor shall not sign the "Release" (as such term is defined in
the Mobil Indemnity) without Mortgagee's prior written consent, which consent
Mortgagee shall not unreasonably withhold.
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(j) Mortgagor covenants and agrees that it shall use commercially
reasonable efforts to cause Mobil to timely submit to the Pennsylvania
Department of Environmental Protection (the PADEP,") a Remedial Action
Completion Report (and any amendments thereto requested by the PAEDP) and obtain
the approval by the PADEP of such Remedial Action Completion Report within
ninety (90) days after the date hereof (but, as long as Mortgagor is using
commercially reasonable efforts to cause Mobil to take such actions, the failure
to obtain such final approval by the PADEP shall not constitute an Event of
Default hereunder). Mortgagor shall use commercially reasonable efforts to
obtain and provide to Mortgagee a copy of the final Remedial Action Completion
Report and a copy of the final approval by the PADEP of same.
1.31. INDEMNIFICATION; SUBROGATION.
(a) MORTGAGOR SHALL INDEMNIFY, DEFEND AND HOLD MORTGAGEE HARMLESS
AGAINST: (i) ANY AND ALL CLAIMS FOR BROKERAGE, LEASING, FINDER'S OR SIMILAR FEES
WHICH MAY BE MADE RELATING TO THE PROPERTY OR THE SECURED INDEBTEDNESS, (ii) ANY
AND ALL LIABILITY, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, CLAIMS, ACTIONS,
SUITS, LIENS, CHARGES, ENCUMBRANCES, COSTS AND EXPENSES (INCLUDING MORTGAGEE'S
ATTORNEYS' FEES, TOGETHER WITH APPELLATE COUNSEL FEES, IF ANY) OF WHATEVER KIND
OR NATURE WHICH MAY BE ASSERTED AGAINST, IMPOSED ON OR INCURRED BY MORTGAGEE
UNDER ANY LEASE OR OCCUPANCY AGREEMENT, FOR ANY LOSS ARISING FROM A FAILURE OR
INABILITY TO COLLECT RENTS AND PROFITS OR IN CONNECTION WITH THE SECURED
INDEBTEDNESS, THIS MORTGAGE, THE PROPERTY, OR ANY PART THEREOF, OR THE EXERCISE
BY MORTGAGEE OF ANY RIGHTS OR REMEDIES GRANTED TO IT UNDER THIS MORTGAGE, AND
ANY DEFAULT UNDER THIS MORTGAGE, (iii) ANY LIENS (WHETHER JUDGMENTS, MECHANICS',
MATERIALMEN'S OR OTHERWISE), CHARGES AND ENCUMBRANCES FILED AGAINST THE
PROPERTY, AND (iv) ANY CLAIMS AND DEMANDS FOR DAMAGES OR INJURY, INCLUDING
CLAIMS FOR PROPERTY DAMAGE, PERSONAL INJURY OR WRONGFUL DEATH, ARISING OUT OF OR
IN CONNECTION WITH ANY ACCIDENT OR FIRE OR OTHER CASUALTY ON THE REAL ESTATE OR
THE IMPROVEMENTS OR ANY NUISANCE OR TRESPASS MADE OR SUFFERED THEREON,
INCLUDING, IN ANY CASE, ATTORNEY'S FEES, COSTS AND EXPENSES AS AFORESAID,
WHETHER AT PRETRIAL, TRIAL OR APPELLATE LEVEL FOR ANY CIVIL, CRIMINAL OR
ADMINISTRATIVE PROCEEDINGS. SHOULD MORTGAGEE INCUR ANY LIABILITY UNDER THIS
MORTGAGE OR ANY OF THE OTHER LOAN DOCUMENTS, THE AMOUNT THEREOF, INCLUDING,
WITHOUT LIMITATION, COSTS, EXPENSES AND REASONABLE ATTORNEYS' FEES, TOGETHER
WITH INTEREST THEREON AT THE DEFAULT INTEREST RATE FROM THE DATE INCURRED BY
MORTGAGEE UNTIL ACTUALLY PAID BY MORTGAGOR, SHALL BE IMMEDIATELY DUE AND PAYABLE
TO MORTGAGEE BY MORTGAGOR ON DEMAND AND SHALL BE SECURED HEREBY AND BY ALL OF
THE OTHER LOAN DOCUMENTS SECURING ALL OR ANY PART OF THE INDEBTEDNESS EVIDENCED
BY THE NOTE. HOWEVER, NOTHING HEREIN SHALL BE CONSTRUED TO OBLIGATE MORTGAGOR TO
INDEMNIFY, DEFEND AND HOLD HARMLESS MORTGAGEE FROM AND - AGAINST ANY AND ALL
LIABILITIES, OBLIGATIONS.
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LOSES, DAMAGES, PENALTIES, CLAIMS, ACTIONS, SUITS, COSTS AND EXPENSES ENACTED
AGAINST, IMPOSED ON OR INCURRED BY MORTGAGEE BY REASON OF MORTGAGEE'S WILLFUL
MISCONDUCT OR GROSS NEGLIGENCE. THIS INDEMNITY SHALL SURVIVE PAYMENT IN FULL OF
THE INDEBTEDNESS SECURED HEREBY.
(b) MORTGAGEE MAY ENGAGE THE SERVICES OF ATTORNEYS IF IT IS MADE A
PARTY DEFENDANT TO ANY LITIGATION (OR THREATENED ACTION OR CLAIM) OR TO ENFORCE
THE TERMS OF THIS MORTGAGE OR TO PROTECT ITS RIGHTS HEREUNDER, AND IN THE EVENT
OF ANY SUCH ENGAGEMENT, MORTGAGOR SHALL PAY MORTGAGEE'S ATTORNEYS' FEES
(TOGETHER WITH REASONABLE APPELLATE COUNSEL FEES, IF ANY), CONSULTANTS' FEES,
EXPERTS' FEES, AND EXPENSES REASONABLY. INCURRED BY MORTGAGEE, WHETHER OR NOT
SUCH ACTION IS ACTUALLY COMMENCED AGAINST MORTGAGOR. ALL REFERENCES TO
"ATTORNEYS" IN THIS SUBSECTION AND ELSEWHERE IN THIS MORTGAGE SHALL INCLUDE
WITHOUT LIMITATION ANY ATTORNEY OR LAW FIRM ENGAGED BY MORTGAGEE AND MORTGAGEE'S
INHOUSE COUNSEL, AND ALL REFERENCES TO "FEES AND EXPENSES" IN THIS SUBSECTION
AND ELSEWHERE IN THIS MORTGAGE SHALL INCLUDE WITHOUT LIMITATION ANY FEES OF SUCH
ATTORNEY OR LAW FIRM AND ANY ALLOCATION CHARGES AND ALLOCATION COSTS OF
MORTGAGEE'S IN-HOUSE COUNSEL.
(c) A WAIVER OF SUBROGATION SHALL BE OBTAINED BY MORTGAGOR FROM ITS
INSURANCE CARRIER AND, CONSEQUENTLY, MORTGAGOR WAIVES ANY AND ALL RIGHT TO CLAIM
OR RECOVER AGAINST MORTGAGEE, ITS OFFICERS, EMPLOYEES, AGENTS AND
REPRESENTATIVES, FOR LOSS OF OR DAMAGE TO MORTGAGOR, THE PROPERTY, MORTGAGOR'S
PROPERTY OR THE PROPERTY OF OTHERS UNDER MORTGAGOR'S CONTROL FROM ANY CAUSE
INSURED AGAINST OR REQUIRED TO BE INSURED AGAINST BY THE PROVISIONS OF THIS
MORTGAGE.
1.32. Covenants with Respect to Indebtedness; Operations and Fundamental
Changes of Mortgagor. Mortgagor represents, warrants and covenants as of the
date hereof and until such time as the indebtedness secured hereby is paid in
full, that Mortgagor:
(a) does not own and will not own any encumbered asset other than (1)
the Property, and (ii) incidental personal property necessary for the operation
of the Property;
(b) is not engaged and will not engage in any business other than the
ownership, management and operation of the Property;
(c) will not enter into any contract or agreement with any general
partner, principal, member, manager or affiliate of Mortgagor or any affiliate
of any such general partner, principal, manager or member of Mortgagor, except
upon terms and conditions that are intrinsically fair and substantially similar
to those that would be available on an arms-length basis with third parties
other than an affiliate;
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(d) has not incurred and will not incur any debt, secured or
unsecured, direct or contingent (including guaranteeing any obligation), other
than (i) the secured indebtedness, and (ii) unsecured trade and operational debt
incurred in the ordinary course of business not outstanding for more than sixty
(60) days with trade creditors and in amounts as are normal and reasonable under
the circumstances, but, in no event, to exceed $315,000.00 in the aggregate; no
debt whatsoever may be secured (senior, subordinate or pari passu) by the
Property, except the Indebtedness;
(e) has not made and will not make any loans or advances to any third
party (including any general partner, principal, member, manager or affiliate of
Mortgagor, or any guarantor);
(f) is and will be solvent and pay its debts from its assets as the
same shall become due;
(g) has done or caused to be done and will do all things necessary to
preserve its existence and corporate, limited liability company and partnership
formalities (as applicable), and will not, nor will any partner, limited or
general, or member or shareholder thereof, amend, modify or otherwise change its
partnership certificate, partnership agreement, certificate or articles of
incorporation or organization, or by- laws or operating agreement or
regulations, in a manner which adversely affects Mortgagor's, or any such
partner's, member's or shareholder's existence as a single-purpose, single-asset
"bankruptcy remote" entity;
(h) will conduct and operate its business as presently conducted and
operated;
(i) will maintain books and records and bank accounts separate from
those of its affiliates, including its general partners, principals and members;
(j) will be, and at all, times will hold itself out to the public as,
a legal entity separate and distinct from any other entity (including any
affiliate of Mortgagor, any constituent party of Mortgagor, any guarantor, or
any affiliate of any constituent party or guarantor), shall correct any known
misunderstanding regarding its status as a separate entity, shall conduct
business in its own name, shall not identify itself or any of its affiliates as
a division or part of the other, and shall maintain and utilize a separate
telephone number and separate stationery, invoices and checks from any other
entity;
(k) will file its own tax returns;
(1) will maintain adequate capital for the normal obligations
reasonably foreseeable in a business of its size and character and in light of
its contemplated business operations;
(m) will not, nor will any shareholder, principal, partner, member,
manager or affiliate, seek the dissolution or winding up, in whole or in part,
of Mortgagor;
(n) will not enter into any transaction of merger or consolidation, or
acquire by purchase or otherwise all or substantially al of the business or
assets of, or any stock or beneficial ownership of, any entity;
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(o) will not commingle the funds and other assets of Mortgagor with
those of any general partner, principal, member, manager or affiliate, or any
other person;
(p) has and will maintain its assets in such a manner that it is not
costly or difficult to segregate, ascertain or identify its individual assets
from those of any affiliate or any other person;
(q) has, and any general partner or managing member of Mortgagor has,
at all times since its formation, observed all legal and customary formalities
regarding its formation and will continue to observe all legal and customary
formalities;
(r) does not and will not hold itself out to be responsible for the
debts or obligations of any other person; and -
(s) upon the commencement of a voluntary or involuntary bankruptcy
proceeding by or against Mortgagor, Mortgagor shall not seek a supplemental stay
or otherwise pursuant to 11 U.S.C. 105 or any other provision of the Act, or
any other debtor relief law (whether statutory, common law, case law, or
otherwise) of any jurisdiction whatsoever, now or hereafter in effect, which may
be or become applicable, to stay, interdict, condition, reduce or inhibit the
ability of Mortgagee to enforce any rights of Mortgagee against any guarantor or
indemnitor of the secured obligations or any other party liable with respect
thereto by virtue of any indemnity, guaranty or otherwise.
1.33. Litigation. Mortgagor will give prompt written notice to Mortgagee of
any litigation or governmental proceedings pending or threatened (in writing)
against Mortgagor which might have a Material Adverse Effect
1.34. ERISA. (a) Mortgagor shall not engage in any transaction which would
cause any obligation, or action taken or to be taken, hereunder (or the exercise
by Mortgagee of any of its rights under the Note, this Mortgage or any of the
other Loan Documents) to be a nonexempt (under a statutory or administrative
class exemption) prohibited transaction under ERISA.
(b) Mortgagor further covenants and agrees to deliver to Mortgagee
such certifications or other evidence from time to time throughout the term -of
this Mortgage, as requested by Mortgagee in its sole discretion, that (i)
Mortgagor is not an "employee benefit plan" as defined in Section 3(3) of ERISA,
which is subject to Title I of ERISA, or a "governmental plan" within the
meaning of Section 3(3) of ERISA; (ii) Mortgagor is not subject to state
statutes regulating investments and fiduciary obligations with respect to
governmental plans; and (iii) one or more of the following circumstances is
true:
(x) Equity interests in Mortgagor are publicly offered securities
within the meaning of 29 C.F.R. Section 2510.3-101(b)(2);
(y) Less than 25 percent of each outstanding class of equity interests
in Mortgagor are held by "benefit plan investors" within the meaning of 29
C.F.R Section 2510.3-101(1)(2); or
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(z) Mortgagor qualifies as an "operating company" or a "real estate
operating company" within the meaning of 29 C.F.R Section 2510.3-101-(c) or
(e) or an investment company registered under the Investment Company Act of
1940.
(c) MORTGAGOR SHALL INDEMNIFY MORTGAGEE AND DEFEND AND HOLD MORTGAGEE
HARMLESS FROM AND AGAINST ALL CIVIL PENALTIES, EXCISE TAXES, OR OTHER LOSS, COST
DAMAGE AND EXPENSE (INCLUDING, WITHOUT LIMITATION, REASONABLE ATTORNEYS' FEES
AND DISBURSEMENTS AND COSTS INCURRED IN THE INVESTIGATION, DEFENSE AND
SETTLEMENT OF CLAIMS AND LOSSES INCURRED IN CORRECTING ANY PROHIBITED
TRANSACTION OR IN THE SALE OF A PROHIBITED LOAN, AND IN OBTAINING ANY INDIVIDUAL
PROHIBITED TRANSACTION EXEMPTION UNDER ERISA THAT MAY BE REQUIRED, IN
MORTGAGEE'S SOLE DISCRETION) THAT MORTGAGEE MAY INCUR, DIRECTLY OR INDIRECTLY,
AS A RESULT OF A DEFAULT UNDER THIS SECTION. THIS INDEMNITY SHALL SURVIVE ANY
TERMINATION, SATISFACTION OR FORECLOSURE OF THIS MORTGAGE.
1.35. Defeasance.
(a) Notwithstanding anything to the contrary contained Mortgage or the
other Loan Documents, at any time after the earlier of anniversary of the date
that is the "startup day," within the meaning of Section 860G(a)(9) of the
Internal Revenue Code of 1986, as amended from time to time or any successor
statute (the "Code"), of a "real estate mortgage investment conduit," (a
"REMIC") within the meaning of Section 860D of the Code, that holds the Note and
this Mortgage and (ii) four (4) years after the date hereof) (such date that is
the earlier of (i) and (ii), the "Defeasance Lockout Expiration Date") and
provided (unless Mortgagee shall otherwise consent, in its sole discretion) no
default or Event. of Default has occurred and is continuing hereunder or under
any of the other Loan Documents, Mortgagor shall have the right to obtain the
release of the Property (or, for a Partial Release (as defined below), the
Individual Property (as defined below)) from the lien of this Mortgage and the
other Loan Documents (the "Defeasance") upon the satisfaction of each of the
following conditions precedent,
i) not less than thirty (30) days prior written notice to Mortgagee
specifying a regular Payment Date under the Note (the "Defeasance
Election Date") on which the Defeasance Deposit (hereinafter
defined) is to be made;
ii) the remittance to Mortgagee on the related Defeasance Election
Date of interest accrued and unpaid on the outstanding principal
amount of the Note (or, for a Partial Release, the Adjusted
Release Amount (as defined below)) to and including the
Defeasance Election Date and the scheduled amortization payment
due on such Defeasance Election Date, together with all other
amounts then due and payable under the Note, this Mortgage and
the other Loan Documents;
iii) the irrevocable deposit with Mortgagee of an amount (the
"Defeasance Deposit") of U.S. Government Securities (hereinafter
defined) which
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through the scheduled payment of principal and interest in
respect thereof in accordance with their terms will provide, not
later than the due date of any payment, cash in an amount
sufficient, without reinvestment, in the opinion of a nationally
recognized firm of independent certified public accountants
expressed in a written certification thereof delivered to
Mortgagee, to pay and discharge the Scheduled Defeasance Payments
(hereinafter defined); the delivery on or prior to the Defeasance
Election Date to Mortgagee of:
(A) a security agreement, in form and substance satisfactory to
Mortgagee, creating a first priority lien on the Defeasance Deposit (the
"Defeasance Security Agreement"), which Defeasance Security Agreement shall
be included within the definition of "Mortgage" for purposes of each Loan
Document from and after the date of its execution;
(B) a release of the Property (or, for a Partial Release, the
Individual Property) from this Mortgage, the Assignment and any TJCC
Financing Statements relating thereto (for execution by Mortgagee) in a
form appropriate for cancellation of such documents in the jurisdiction in
which the Property (or, fox a Partial Release, Individual Property) is
located;
(C) a certificate of an authorized representative of Mortgagor
certifying that the requirements set forth in this subparagraph (a) have
been satisfied;
(D) an opinion of counsel for Mortgagor in form and substance
satisfactory to Mortgagee to the effect that the Mortgagee has a perfected
first priority security interest in the Defeasance Deposit;
(E) an opinion of counsel for Mortgagee, prepared and delivered
by the servicer at. Mortgagor's reasonable expense, stating that any trust
formed as a REMIC in connection with any Secondary Market Transaction (as
hereinafter defined) will not fail to maintain its status as a REMIC as a
result of such Defeasance;
(F) in the event of a Partial Release (as defined below),
Mortgagee, at Mortgagor's expense, shall prepare all necessary additional
documents to modify this Mortgage (if deemed necessary by Mortgagee or if
required by the law of the state in which the Property is located) and
issue two substitute notes for the Note, one executed by the Released Party
(as defined below) having a principal balance equal to the defeased portion
of the original Note (the "Defeased Note") and the other note executed by
the other entity comprising Mortgage and. having a principal balance equal
to the undefeased portion of the original Note (the
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"Undefeased Note"). The Defeased Note and the Undefeased Note shall have
identical terms as the Note except for the principal balance and the
splitting of the two makers of the original Note, as set forth above. The
principal balance of the Defeased Note shall equal the Adjusted Release
Amount (as defined below) for the Individual Property, that is the subject
of the Partial Release; and
(G) such other certificates, documents or instruments as
Mortgagee may reasonably request; and
v) the payment by Mortgagor to Mortgagee of all reasonable
out-of-pocket costs and expenses (including, without limitation,
reasonable attorneys' fees and disbursements) incurred or
anticipated to be incurred by Mortgagee in connection with the
release of the Property (or, for a Partial Release, the
Individual Property) from the lien of this Mortgage and the other
Loan Documents pursuant to this Section 1.35 including, without
limitation, Mortgagee's determination of whether Mortgagor has
satisfied all of the related conditions and requirements set
forth in this Section 1.35.
(b) Upon compliance with the requirements of subparagraph (a) above,
the Property (or, for a Partial Release, the Individual Property) shall be
released from the lien of this Mortgage, the Assignment and any UCC Financing
Statements related thereto, the obligations hereunder and under the other Loan
Documents with respect to the Property (or, for a Partial Release, the
Individual Property) shall no longer be applicable and the Defeasance Deposit
shall be the sole source of collateral securing the Note (or, for a Partial
Release, the Defeased Note), Mortgagee shall apply the Defeasance Deposit and
tie payments received therefrom to the payment of all scheduled principal and
interest payments (the "Scheduled Defeasance Payments") due on all successive
Payment Dates under the Note (or, for a Partial Release, the Defeased Note)
after the Defeasance Election Date and the payment due on the final maturity
date of the Note (or, for a partial release, the Defeased Note). Mortgagor (or
for a partial release, the Released Parry), pursuant too the Defeasance Security
Agreement or other appropriate document, shall direct that the payments received
from the Defeasance Deposit shall be made directly to Mortgagee and applied to
satisfy the obligations of Mortgagor (or, for a Partial Release, the Released
Party) under the Note (or, for a Partial Release, the Defeased Note). In
connection with such release, if Mortgagor shall continue to own any assets
other than the Defeasance Deposit, and in all events in the case of a Partial
Release, Mortgagor (or, for a Partial Release, the Released Party) shall
establish or designate a single-purpose, bankruptcy-remote successor entity
acceptable to Mortgagee (the "Successor Trustor"), with respect to which a
nonconsolidation opinion satisfactory in form and substance to Mortgagee has
been delivered to Mortgagee (if such a nonconsolidation opinion was required of
Mortgagor in connection with the origination of the indebtedness secured hereby)
in which case Mortgagor (or, for a Partial Release, the Released Party) shall
transfer and assign to the Successor Trustor all obligations, rights and duties
under the Note (or, for a Partial Release, the Defeased Note) and the Defeasance
Security Agreement, together with the pledged Defeasance Deposit. The Successor
Trustor shall assume the obligations of Mortgagor (or, for a Partial Release,
the Released Party) under the Note (or, for a Partial Release, the Defeased
Note) and the. Defeasance Security Agreement, and Mortgagor (or, fat a Partial
Release, the Released Party) shall be relieved of its
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obligations hereunder and thereunder. Mortgagor (or, for a Partial Release, the
Released Party) shall pay One Thousand and No/100 Dollars ($1,000.00) to the
Successor Trustor as consideration for assuming such Mortgagor obligations.
(c) As used herein, the term "U.S. Government Securities" shall mean
securities that are direct obligations of the United States of America for the
full and timely payment of which its full faith and credit is pledged.
(d) On and after the Defeasance Lockout Expiration Date, Mortgagor may
obtain the release of either (but not both) the 0000 Xxxxxxxxxx parcel or the
0000 Xxxxxxxxxx parcel (each, an "Individual Property") from the lien of this
Mortgage and the other Loan Documents and the release of either (but not both)
Xxxx Xxxxxxxx Xxxx, LP's or Xxxx Xxxxxxxx Hill II, LP's obligations (whichever
is the owner of the released parcel, the "Released Party") under the Loan
Documents (other than those expressly stated to survive) (collectively, a
"Partial Release") upon the satisfaction of each of the following conditions:
(i) No Event of Default shall have occurred and be continuing;
(ii) Mortgagor shall submit, or cause to be submitted, to
Mortgagee, not less than twenty (20) days prior to the date requested
for such release, a release of lien (and related Loan Documents) for
such Individual Property for execution by Mortgagee. Such release
shall be in a form appropriate in each jurisdiction in which the
Individual Property is located and that contains standard provisions,
if any, protecting the rights of the releasing lender. In addition,
Mortgagor shall provide all other documentation Mortgagee reasonably
requires to be delivered by Mortgagor in connection with such release,
together with an Officer's Certificate (as defined below) certifying
that such documentation (i) is in compliance with all Legal
Requirements (as defined below), (ii) will effect such release in
accordance with the terms of this Mortgage. and (iii) will not impair
or otherwise adversely affect the liens, security interests and other
rights of Lender under the Loan Documents not being released (as to
the party to the Loan Documents and Property subject to the Loan
Documents not being released);
(iii) After giving effect to such release, the Debt Service
Coverage Ratio (as defined in the Cash Management Agreement) for the
Individual Property that will remain subject to the lien of this
Mortgage shall be equal to or greater than 1.60 to 1.0, such
calculation to be based on pro-forma Gross Income from Operations (as
defined in the Cash Management Agreement) on an annualized basis and
Underwritten. Operating Expenses (as defined in the Cash Management
Agreement) for the twelve (12) full calendar months immediately
preceding the release of the Individual Property (for purposes of this
calculation, pro-form Gross Income from Operations shall be based on
the then-current rent roll for the Property and, in addition to the
normal limitations contained within Gross Income from Operations,
shall only include income from tenants that are in place and will
remain in place and paying rent during the entire succeeding twelve
(12) month period and Underwritten Operating Expenses shall be the
Underwritten Operating Expenses for the prior twelve full calendar
months but
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reduced to reflect cost reductions after release of the Individual
Property, all of the foregoing in this parenthetical as reasonably
underwritten and determined by Mortgagee);
(iv) The Individual Property to be released shall be conveyed to
a person other than Mortgagor or any of its affiliates;
(v) On or before the date that is twenty (20) days prior to the
requested release date, Mortgagor shall provide Mortgagee with all
information reasonably required to calculate the Debt Service Coverage
Ratio; and
(vi) The Loan shall be defeased in accordance with the provisions
above in the amount of the Adjusted Release Amount (as defined below)
and Mortgagor shall pay to Mortgagee all other sutras due and payable
under this Mortgage in connection with such Defeasance.
(vii) As used herein, the following terms shall have the
following meanings-,
"Officer's Certificate" shall mean a certificate delivered to
Mortgagee by Mortgagor which is signed by an authorized senior
officer of the general partner or managing member of each entity
comprising Mortgagor, as applicable.
"Legal Requirements" shall mean shall mean, with respect to each
Individual Property, all federal, state, county, municipal and
other governmental statutes, laws, rules, orders, regulations,
ordinances, judgments, decrees and injunctions of governmental
authorities affecting such Individual Property or any part
thereof, or the construction, use, alteration or operation
thereof, or any part thereof, whether now or hereafter enacted
and in force, and all permits, licenses and authorizations and
regulations relating thereto, and all covenants, agreements,
restrictions and encumbrances contained in any instruments,
either of record or known to Mortgagor, at any time in. force
affecting such Individual Property or any part thereof,
incl-Ming, without limitation, any which may (a) require repairs,
modifications or alterations in or to such Individual Property or
any part thereof, or (b) in any way limit the use and enjoyment
thereof.
"Adjusted Release Amount" shall mean (i) for 0000 Xxxxxxxxxx,
$8,062,500.00 and (ii) for 0000 Xxxxxxxxxx, $5,062,500.00.
[NO FURTHER TEXT ON THIS PAGE]
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ARTICLE II
EVENTS OF DEFAULT
2.1. Events of Default. The occurrence of any of the following events shall
be a default hereunder (each, an "Event of Default"):
(a) Mortgagor fails to make any payment under the Note when due,
subject to any grace period set forth therein.
(b) Mortgagor fails to punctually perform any covenant, agreement,
obligation, term or condition hereof which requires payment of any money to
Mortgagee (except those regarding payments to be made under the Note, which
failure is subject to any grace periods set forth in the Note).
(c) Mortgagor fails to provide insurance as required by Section 1.4
hereof or fails to perform any covenant, agreement obligation, term or condition
set forth in Section 1.16 or Section 1.30 hereof.
(d) Mortgagor fails to perform any other covenant, agreement,
obligation, term or condition set forth herein other than those otherwise
described in this Section 2.1 and, to the extent such failure or default is
susceptible of being cured, the continuance of such failure or default for
thirty (30) days after written notice thereof from Mortgagee to Mortgagor;
provided, however that if such default is susceptible of cure but such cure
cannot be accomplished with reasonable diligence within said period of time, and
if Mortgagor commences to cure such default promptly after receipt of notice
thereof from Mortgagee, and thereafter prosecutes the curing of such default
with reasonable diligence, such period of time shall be extended for such period
of time as may be necessary to cure such default with reasonable diligence, but
not to exceed an additional ninety (90) days.
(e) Any representation or warranty made herein, in or in connection
with any application or commitment relating to the loan evidenced by the Note,
or in any of the other Loan Documents to Mortgagee by Mortgagor, by any
principal, managing member or general partner in Mortgagor or by any indemnitor
or guarantor under any indemnity or guaranty executed in connection with the
loan secured hereby is determined by Mortgagee to have been false or misleading
in any material respect at the time made.
(f) There shall be a sale, conveyance, disposition, alienation,
hypothecation, leasing, assignment, pledge, mortgage, granting of a security
interest in or other transfer or further encumbrancing of the Property,
Mortgagor or its owners, or any portion thereof or any interest therein, in
violation of Section 1.13 hereof.
(g) A default occurs under any of the other Loan Documents which has
not been cured within any applicable grace or cure period therein provided,
(h) Mortgagor, any principal, general partner or managing member (as
applicable) in Mortgagor or any indemnitor or guarantor under any indenuity or
guaranty
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executed in connection with the loan secured hereby becomes insolvent, or shall
make a transfer in fraud of creditors, or shall make an assignment for the
benefit of creditors, shall file a petition in bankruptcy, shall voluntarily be
adjudicated insolvent or bankrupt or shall admit in writing the inability to pay
debts as they mature, shall petition or apply to any tribunal for or shall
consent to or shall not contest the appointment of a receiver, trustee,
custodian or similar officer for Mortgagor, for any such principal, general
partner or managing member (as applicable) of Mortgagor or Br any such
indemnitor or guarantor or for a substantial part of the assets of Mortgagor, of
any such principal or general partner or managing member of Mortgagor or of any
such indemnitor or guarantor, or shall commence any case, proceeding or other
action under any bankruptcy, reorganization, arrangement, readjustment or debt,
dissolution or liquidation law or statute of any jurisdiction, whether now or
hereafter in effect.
(f) A petition ("Petition") is filed or any ease, proceeding or other
action is commenced against Mortgagor, against any principal, general partner or
managing member of Mortgagor or against any indemnitor or guarantor under any
indemnity or guaranty executed in connection with the loan secured hereby
seeking to have an order for relief entered against it as debtor or seeking
reorganization, arrangement, adjustment, liquidation, dissolution or composition
of it or its debts or other relief under any law relating to bankruptcy,
insolvency, arrangement, reorganization, receivership or other debtor relief
under any law or statute of any jurisdiction, whether now or hereafter in
effect, or a court of competent jurisdiction enters an order for relief against
Mortgagor, against any principal or general partner or managing member of
Mortgagor or against any indemnitor or guarantor under any indemnity or guaranty
executed in connection with the loan secured hereby, as debtor, or an order,
judgment or decree is entered appointing, with or without the consent of
Mortgagor, of any such principal or general partner or managing member of
Mortgagor or of any such indemnitor or guarantor, a receiver, trustee, custodian
or similar officer for Mortgagor, for any such principal or general partner or
managing member of Mortgagor or for any such indemnitor or guarantor, or for any
substantial part of any of the properties of Mortgagor, of any such principal,
general partner or managing member of Mortgagor or of any such indemnitor or
guarantor, and if any such event shall occur, such petition, case, proceeding,
action, order, judgment or decree shall not be dismissed within sixty (60) days
after being commenced.
(j) Mortgagor solicits or aids the solicitation of the filing of any
Petition against Mortgagor including, without limitation: (i) providing
information regarding the identity of creditors or the nature of creditors'
claims to any third party unless compelled to do so by order of a court of
competent jurisdiction or by regulation promulgated by a governmental agency; or
(ii) paying the legal fees or expenses of any creditor of or interest holder in
Mortgagor with respect to any matter whatsoever.
(k) The Property or any part thereof shall be taken on execution or
other process of law in any action against Mortgagor.
(l) Mortgagor abandons all or a portion of the Property.
(m) The holder of any lien or security interest on the Property
(without implying the consent of Mortgagee to the existence or creation of any
such lien or security interest), whether superior or subordinate to this
Mortgage or any of the other Loan Documents,
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declares a default and such default is not cured within any applicable grace or
cure period set forth in the applicable document or such holder institutes
foreclosure or other proceedings for the enforcement of its remedies thereunder.
(n) The Property, or any part thereof, is subjected to actual or
threatened waste or to removal, demolition or material alteration so that the
value of the Property is materially diminished thereby and Mortgagee determines
(in its subjective determination) that it is not adequately protected from any
loss, damage or risk associated therewith.
(o) Any dissolution, termination, partial or complete liquidation,
merger or consolidation of Mortgagor, any of its principals, members, or general
partners.
ARTICLE III
REMEDIES
3.1. Remedies Available. If there shall occur a default under this
Mortgage, and such default has not been cured within any applicable grace or
cure period, then this Mortgage is subject to foreclosure as provided by law and
Mortgagee may, at its option and by or through a trustee, nominee, assignee or
otherwise, to the fullest extent permitted by law, exercise any or all of the
following rights, remedies and recourses, either successively or concurrently.
(a) Acceleration Accelerate the maturity date of the Note and declare
any or all of the indebtedness secured hereby to be immediately due and payable
without any presentment, demand, protest, notice or action of any kind whatever
(each of which is hereby expressly waived. by Mortgagor), whereupon the same
shall become immediately due and payable. Upon any such acceleration, payment of
such accelerated amount shall constitute a prepayment of the principal balance
of the Note and any applicable prepayment fee provided for in the Note shall
then be immediately due and payable.
(b) Entry an the Property. Without in any way curing or waiving any
default of Mortgagor, either in person, by agent or by court appointed receiver,
with or without bringing any action or proceeding, or by a receiver appointed by
a court and without regard to the adequacy of its security, enter upon and take
possession of the Property, or any part thereof, in its own name, without force
or with such force as is permitted by law and without notice or process or with
such notice or process as is required by law unless such notice and process is
waivable, in which case Mortgagor hereby waives such notice and process, and do
any and all acts and perform any and all work which may be desirable or
necessary in Mortgagee's judgment to complete any unfinished construction on the
Real Estate, to preserve and/or enhance the value, marketability or rentability
of the Property, to increase the income therefrom, to manage and operate the
Property or to protect the security hereof and all sums expended by Mortgagee
therefor, together with interest thereon at the Default Interest Rate (as
defined in the Note), shall be immediately due and payable to Mortgagee by
Mortgagor on demand and shall be secured hereby and by all of the other Loan
Documents securing all or any part of the indebtedness evidenced by the Note.
(c) Collect Rents and Profits. With or without taking possession of
the Property, xxx for or otherwise collect the Rents and Profits, including
those past due and unpaid,
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and apply the same, less costs and expenses of operation and collection,
including reasonable attorney's fees, upon any indebtedness secured hereby, all
in such order as Mortgagee in its discretion may determine.
(d) Appointment of Receiver. Upon, or at any time prior or after,
initiating the exercise of any power of sale, instituting any judicial
foreclosure or instituting any other foreclosure of the liens and security
interests provided for herein or any other legal proceedings hereunder, make
application, ex parte, to a court of competent jurisdiction for appointment of a
receiver for all or any part of the Property, as a matter of strict right and
without notice to Mortgagor and without regard to the adequacy of the Property
for the repayment of the indebtedness secured hereby or the solvency of
Mortgagor or any person or persons liable for the payment of the indebtedness
secured hereby, and Mortgagor does hereby irrevocably consent to such
appointment, waives any and all notices of and defenses to such appointment and
agrees not to oppose any application therefor by Mortgagee, but nothing herein
is to be construed to deprive Mortgagee of any other right, remedy or privilege
Mortgagee may now have under the law to have a receiver appointed, provided,
however, that the appointment of such receiver, trustee or other appointee by
virtue of any court order, statute or regulation shall not impair or in any
manner prejudice the rights of Mortgagee to receive payment of the Rents and
Profits pursuant to other terms and provisions of this Mortgage or the
Assignment. Any such receiver shall have all of the usual powers and duties of
receivers in similar cases, including, without limitation, the full power to
hold, develop, rent, lease, manage, maintains operate and otherwise use or
permit the use of the Property upon such terms and conditions as said receiver
may deem to be prudent and reasonable under the circumstances as more fully set
forth in Section 3.3 below. Such receivership shall, at the option of Mortgagee,
continue until full payment of all of the indebtedness secured hereby or until
title to the Property shall have passed by foreclosure sale under this Mortgage
or deed in Lien of foreclosure.
(e) Foreclosure. Immediately commence an action to foreclose this
Mortgage or to specifically enforce its provisions or any of the indebtedness
secured hereby pursuant to the statutes in such case made and provided and sell
the Property or cause. the Property to be sold in accordance with the
requirements and procedures provided by said statutes in a single parcel or in
several parcels at the option of Mortgagee. In the event foreclosure proceedings
are filed by Mortgagee, all expenses incident to such proceedings, including,
but not limited to, attorneys fees and costs, shall be paid by Mortgagor and
secured by this Mortgage and by all of the other Loan Documents securing all or
any part of the indebtedness evidenced by the Note, The secured indebtedness and
all other obligations secured by this Mortgage, including, without limitation,
interest at the Default Interest Rate, any prepayment charge, fee or premium
required to be paid under the Note in order to prepay principal (to the extent
permitted by applicable law), reasonable attorneys fees and any other amounts
due and unpaid to Mortgagee under the Loan Documents, may be bid by Mortgagee in
the event of a foreclosure sale hereunder. In the event of a judicial sale
pursuant to a foreclosure decree, it is understood and agreed that Mortgagee or
its assigns may become the purchaser of the Property or any part thereof
(a) Confession of Judgment. FOR THE PURPOSE OF PROCURING POSSESSION OF
THE PROPERTY IN THE EVENT OF ANY DEFAULT HEREUNDER OR UNDER THE NOTE, MORTGAGOR
HEREBY AUTHORIZES AND EMPOWERS ANY ATTORNEY OF ANY COURT OF RECORD IN THE
COMMONWEALTH OF
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PENNSYLVANIA OR ELSEWHERE, AS ATTORNEY FOR MORTGAGOR AND ALL PERSONS CLAIMING
UNDER OR THROUGH MORTGAGOR, AND TO APPEAR FOR AND CONFESS JUDGMENT AGAINST
MORTGAGOR, AGAINST ALL PERSONS CLAIMING UNDER OR THROUGH MORTGAGOR, FOR THE
RECOVERY BY MORTGAGEE OF POSSESSION OF THE PROPERTY, WITHOUT ANY STAY OF
EXECUTION, FOR WHICH THIS MORTGAGE, OR A COPY THEREOF VERIFIED BY AFFIDAVIT,
SHALL BE A SUFFICIENT WARRANT; AND THEREUPON A WRIT OF POSSESSION MAY BE ISSUED
FORTHWITH, WITHOUT ANY PRIOR WRIT OR PROCEEDING WHATSOEVER MORTGAGOR HEREBY
RELEASES MORTGAGEE FROM ALL PROCEDURAL ERRORS AND DEFECTS WHATSOEVER IN ENTERING
SUCH ACTION AND JUDGMENT AND IN CAUSING SUCH WRIT OR WRITS TO BE ISSUED, AND
HEREBY AGREES THAT NO WRIT OF PROCEDURAL ERROR OR APPEAL SHALL BE FILED OR MADE
WITH RESPECT THERETO. IF FOR ANY REASON AFTER SUCH ACTION HAS BEEN COMMENCED THE
SAME SHALL BE DISCONTINUED OR POSSESSION OF THE PROPERTY SHALL REMAIN IN OR BE
RESTORED TO MORTGAGOR, MORTGAGEE SHALL HAVE THE RIGHT FOR THE SAME DEFAULT OR
ANY SUBSEQUENT DEFAULT TO BRING ONE OR MORE FURTHER ACTIONS- AS ABOVE PROVIDED
TO RECOVER POSSESSION OF THE PROPERTY. MORTGAGEE MAY BRING SUCH ACTION IN
EJECTMENT BEFORE OR AFTER THE INSTITUTION OF FORECLOSURE PROCEEDINGS UPON THIS
MORTGAGE, OR AFTER JUDGMENT HEREON OR ON THE NOTE, OR AFTER A SALE OF THE
PROPERTY BY THE SHERIFF.
MORTGAGOR CONFIRMS TO MORTGAGEE THAT (I) MORTGAGOR IS A BUSINESS ENTITY AND
THAT ITS PRINCIPALS ARE KNOWLEDGEABLE IN BUSINESS MATTERS; (II) THE TERMS OF
THIS MORTGAGE, INCLUDING THE FOREGOING WARRANT OF ATTORNEY TO CONFESS JUDGMENT,
HAVE BEEN NEGOTIATED AND AGREED UPON IN A COMMERCIAL CONTEXT; AND (III) IT HAS
FULLY REVIEWED THE AFORESAID WARRANT OF ATTORNEY TO CONFESS JUDGMENT WITH ITS
OWN COUNSEL AND IS KNOWINGLY AND VOLUNTARILY WAIVING CERTAIN RIGHTS IT WOULD
OTHERWISE POSSESS, INCLUDING, BUT NOT LIMITED TO, THE RIGHT TO ANY NOTICE OR A
HEARING PRIOR TO THE ENTRY OF JUDGMENT BY MORTGAGEE PURSUANT TO THE AFORESAID
WARRANT OF ATTOY.
Initials: /s/ XXX
-----------------
(f) Other. Exercise any other right or remedy available hereunder,
under any of the other Loan Documents or at law or in equity.
3.2. Application of Proceeds. To the fullest extent permitted by law, the
proceeds of any sale under this Mortgage shall be applied to the extent funds
are so available to the following items in such order as Mortgagee in its
discretion may determine:
(a) To payment of the costs, expenses and fees of taking possession of
the Property, and of holding, operating, maintaining, using, leasing, repairing,
improving, marketing and selling the same and of otherwise enforcing Mortgagee's
right and remedies hereunder and
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and the other Loan Documents, including, but not limited to, receivers fees,
court costs, attorneys, accountants, appraisers, auctioneers, managers and
other professional fees, title charges and transfer taxes.
(b) To payment of all sums expended by Mortgagee under the terms of
any of the Loan Documents and not yet repaid, together with interest on such
sums at the Default Interest Rate (as defined in the Note).
(c) To payment of the secured indebtedness and all other obligations
secured by this Mortgage, including, without limitation, interest at the Default
Interest Rate (as defined in the Note) and, to the extent permitted by
applicable law, any prepayment fee, charge or premium required to be paid under
the Note in order to prepay principal, in any order that Mortgagee chooses in
its sole discretion.
(d) The remainder, if any, of such funds shall be disbursed to
Mortgagor or to the person or persons legally entitled thereto.
3.3. Right and Authority of Receiver or Mortgagee in the Event of Default:
Power, of Attorney. Upon the occurrence of a default hereunder, which
default is not cured within any applicable grace or cure period, and entry upon
the Property pursuant to Section 3.1(b) hereof or appointment of a receiver
pursuant to Section 3.1(d) hereof, and under such terms and conditions as may be
prudent and reasonable under the circumstances in Mortgagee's or the receiver's
sole discretion, all at Mortgagor's expense, Mortgagee or said receiver, or such
other persons or entities as they shall hire, direct or engage, as the case may
be, may do or permit one or more of the following, successively or concurrently:
(a) enter upon and take possession and control of any and all of the Property;
(b) take and maintain possession of all documents, books, records, papers and
accounts relating to the Property; (c) exclude Mortgagor and its agents,
servants and employees wholly from the Property; (d) manage and operate the
Property; (e) preserve and maintain the Property; (f) make repairs and
alterations to the Property; (g) complete any construction or repair of the
Improvements, with such changes, additions or modifications of the plans and
specifications or intended disposition and use of the Improvements as Mortgagee
may in its sole discretion deem appropriate or desirable to place the Property
in such condition as will, in Mortgagee's sole discretion, make it or any part
thereof readily marketable or rentable; (h) conduct a marketing or leasing
program with respect to the Property, or employ a marketing or leasing agent or
agents to do so, directed to the leasing or sale of the Property under such
terms and conditions as Mortgagee may in its sole discretion deem appropriate or
desirable; (i) employ such contractors, subcontractors, materialmen, architects,
engineers, consultants, managers, brokers, marketing agents, or other employees,
agents, independent contractors or professionals, as Mortgagee may in its sole
discretion deem appropriate or desirable to implement and effectuate the rights
and powers herein granted; (j) execute and deliver, in the name of Mortgagee as
attorney- in- fact and agent of Mortgagor or in its own name as Mortgagee, such
documents and instruments as are necessary or appropriate to consummate
authorized transactions; (k) enter into such leases, whether of real or personal
property, or tenancy agreements, under such terms and conditions as Mortgagee
may in its sole discretion deem appropriate or desirable; (l) collect and
receive the Rents and Profits from the Property; (m) eject tenants or repossess
personal property, as provided by law, for breaches of the conditions of their
leases or other agreements; (n) xxx for unpaid Rents and Profits, payments,
income or proceeds
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in the name of Mortgagor or Mortgagee; (o) maintain actions in forcible entry
and detainer, ejectment for possession and actions in distress for rent; (p)
compromise or give acquittance for Rents and Profits, payments, income or
proceeds that may become due; (q) delegate or assign any and all rights and
powers given to Mortgagee by this Mortgage; and (r) do any acts which Mortgagee
in its sole discretion deems appropriate or desirable to protect the security
hereof and use such measures, legal or equitable, as Mortgagee may in its sole
discretion deem appropriate or desirable to implement and effectuate the
provisions of this Mortgage. This Mortgage shall constitute a direction to and
full authority to any lessee, or other third party who has heretofore dealt or
contracted or may hereafter deal or contract with Mortgagor or Mortgagee, at the
request of Mortgagee, to pay all amounts owing under any lease, contract,
concession, license or other agreement to Mortgagee without proof of the default
relied upon. Any such lessee or third party is hereby irrevocably authorized to
rely upon and comply with (and shall be fully protected by Mortgagor in so
doing) any request, notice or demand by Mortgagee for the payment to Mortgagee
of any Rents and Profits or other sums which may be or thereafter become due
under its lease, contract, concession, license or other agreement, or for the
performance of any undertakings under any such lease, contract, concession,
license or other agreement, and shall have no right or duty to inquire whether
any default under this Mortgage or under any of the other Loan Documents has
actually occurred or is then existing. Mortgagor hereby constitutes and appoints
Mortgagee, its assignees, successors, transferees and nominees, as Mortgagor's
true and lawful attorney-in fact and agent, with full power of substitution in
the Property, in Mortgagor's name, place and stead, to do or permit any one or
more of the foregoing described rights, remedies, powers and authorities,
successively or concurrently, and said power of attorney shall be deemed a power
coupled with an interest and irrevocable so long as any indebtedness secured
hereby is outstanding. Any money advanced by Mortgagee in connection with any
action taken under this Section 3_3, together with interest thereon at the
Default Interest Rate (as defined in the Note) from the date of making such
advancement by Mortgagee until actually paid by Mortgagor, shall be a demand
obligation owing by Mortgagor to Mortgagee and shall be secured by this Mortgage
and by every other instrument securing the secured indebtedness.
3.4. Occupancy After Foreclosure. In the event there is a sale or sales
pursuant to Section 3.1 hereof and at the time of such sale or sales, Mortgagor
or Mortgagor's representatives, successors or assigns, or any other persons
claiming any interest in the Property by, through or under Mortgagor (except
tenants of space in the Improvements subject to leases entered into prior to the
date hereof), are occupying or using the Property, or any part thereof, then, to
the extent not prohibited by applicable law, each and all shall, at the option
of Mortgagee or the purchaser at such sale, as the case may be, immediately
become the tenant of the purchaser at such sale, which tenancy shall be a
tenancy from day-to-day, terminable at the will of either landlord or tenant, at
a reasonable rental per day based upon the value of the Property occupied or
used, such rental to be due daily to the purchaser. Further, to the extent
permitted by applicable law, in the event the tenant fails to surrender
possession of the Property upon the termination of such tenancy, the purchaser
shall be entitled to institute and maintain an action for unlawful detainer of
the Property in the appropriate court of the county in which the Real Estate is
located.
3.5. Notice to Account Debtors. Mortgagee may, at any time after a default
hereunder, which default is not cured within any applicable grace or cure
period, notify the account debtors and obligors of any accounts, chattel paper,
negotiable instruments or other
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evidences of indebtedness to Mortgagor included in the Property to pay Mortgagee
directly. Mortgagor shall at any time or from time to time upon the request of
Mortgagee provide to Mortgagee a current list of all such account debtors and
obligors and their addresses.
3.6. Cumulative Remedies. All remedies contained in this Mortgage are
cumulative and Mortgagee shall also have all other remedies provided at law and
in equity or in any other Loan Documents. Such remedies may be pursued
separately, successively or concurrently at the sole subjective direction of
Mortgagee and may be exercised in any order and as often as occasion therefor
shall arise. No act of Mortgagee shall be construed as an election to proceed
under any particular provisions of this Mortgage to the exclusion of any other
provision of this Mortgage or as an election of remedies to the exclusion of any
other remedy which may then or thereafter be available to Mortgagee. No delay or
failure by Mortgagee to exercise any right or remedy under this Mortgage shall
be construed to be a waiver of that right or remedy or of any default hereunder.
Mortgagee may exercise any one or more of its rights and remedies at its option
without regard to the adequacy of its security.
3.7. Payment of Expenses. Mortgagor shall pay on demand all of Mortgagee's
expenses reasonably incurred in any efforts to enforce any terms of this
Mortgage, whether or not any lawsuit is filed and whether or not foreclosure is
commenced but not completed, including, but not limited to, reasonable legal
fees and disbursements, foreclosure costs and title charges, together with
interest thereon from and after the date incurred by Mortgagee until actually
paid by Mortgagor at the Default Interest Rate (as defined in, the Note), and
the same shall be secured by this Mortgage and by all of the other Loan
Documents securing all or any part of the indebtedness evidenced by the Note.
ARTICLE IV
MISCELLANEOUS TERMS AND CONDITIONS
4.1. Time of Essence. Time is of the essence with respect to all provisions
of this Mortgage.
4.2. Release of Mortgage. This instrument is granted upon express condition
that if Mortgagor punctually pays and performs all of the obligations under and
in accordance with thee terms of the Loan Documents and the terms hereof, then
this Mortgage and the estate granted hereby shall cease and become void, except
for those provisions hereof which by their terms survive, and the Property shall
become wholly clear of the liens, security interests, conveyances and
assignments evidenced hereby, which shall be released by Mortgagee in due form
at. Mortgagor's cost. No release of this Mortgage or the lien hereof shall be
valid unless executed
4.3. Action by Mortgagee. Without affecting Mortgagor's liability for the
payment of any of the indebtedness secured hereby, Mortgagee may from time to
time and without notice to Mortgagor: (a) release any person liable for the
payment of the indebtedness secured hereby; (b) extend or modify the terms of
payment of the indebtedness secured hereby; (c) accept additional real or
personal property of any kind as security or alter, substitute or release any
property securing the indebtedness secured hereby; (d) recover any part of the
Property; (e) consent in writing to the making of any subdivision map or plat
thereof; (f) join in granting any easement
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therein; bb(g) join in any extension agreement of this Mortgage or any agreement
subordinating the lien hereof.
4.4. Notices. Any notice, report, demand or other instrument authorized or
required to be given or furnished hereunder or as required by law ("Notices")
shall be in writing and shall be given as follows: (a) by band delivery; (b) by
deposit in the United States mail as first class certified mail, return receipt
requested, postage paid; (c) by overnight nationwide commercial courier service;
or (d) by telecopy transmission (other than for notices of default) with a
confirmation copy to be delivered by duplicate notice in accordance with any of
clauses (a)-(c) above, in each case, addressed to the party intended to receive
the same at the following address(es):
Mortgagee: Column Financial, Inc.
Eleven Madison Avenue
9th Floor
New York, New York 10010-3629
Attention: Xxxxxx Xxxxxx
Telecopier: (000) 000-0000
Re: Thor / Chestnut, Philadelphia, Pennsylvania
Loan Amount: $10,500,000
Column Loan Number: 271089
with copies to: Credit Suisse First Boston Mortgage Capital LLC
Legal & Compliance Department Xxx Xxxxxxx
Xxxxxx Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. XxXxxxxxx, Esq.
Vice President and Counsel
Telecopier: (000) 000-0000
Re: Thor I Chestnut, Philadelphia, Pennsylvania
Loan Amount: $10,500,000
Column Loan Number: 271089
Servicer: KeyCorp Real Estate Capital Markets, Inc.
dlb/a Key Commercial Mortgage
000 Xxxx Xxxxxx, Xxxxx 0000 Xxxxxx
Xxxx, Xxxxxxxx 00000
Attention: Xxxxx Xxxxxxx
Telecopier: 216-357-6543
or any successor servicer of the Loan.
Re: Thor / Chestnut, Philadelphia, Pennsylvania
Loan Amount: 510,500,000
Column Loan Number: 271089
Mortgagor: Xxxx Xxxxxxxx Hill, L.P.
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Xxxx Xxxxxxxx Xxxx XX, X.X.
c/o Thor Equities, LLC
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxx and Xxxx Xxxxx
Telecopier: (000) 000-0000 and (000) 000-0000
with a copy to:
Xxxxxx Xxxxxx, Esq.
Xxxxxxx & Masyr, LLP
000 X. 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier: (000) 000-0000
Any party may change the address to which any such Notice is to be
delivered to any other address within the United States of America, by
furnishing ten (10) days written notice of such change to the other parties in
accordance with the provisions of this Section 4.4. All notices, demands and
requests shall be effective upon personal delivery, or one (1) business day
after being deposited with the private courier service, or two (2) business days
after being deposited in the United States mail as required above. The inability
to deliver Notices because of a changed address of which no Notice was given, or
rejection or refusal to accept any Notice offered for delivery shall be deemed
to be receipt of the Notice as of the date of such inability to deliver or
rejection or refusal to accept delivery, Notice for either party may be given by
its respective counsel. Additionally, notice from Mortgagee may also be given by
the Servicer.
4.5. Successors and Assigns. The terms, provisions, indemnities, covenants
and conditions hereof shall be binding upon Mortgagor and the successors and
assigns of Mortgagor, including all successors in interest in and to all or any
part of the Property, and shall inure to the benefit of Mortgagee, and its
successors and assigns and shall constitute covenants running with the land. If
Mortgagor consists of more than one person or entity, each will be jointly and
severally liable to perform the obligations of Mortgagor.
4.6. Severability, A determination that any provision of this Mortgage is
unenforceable or invalid shall not affect the enforceability or validity of any
other provision.
4.7. Gender. Within this Mortgage, words of any gender shall be, held and
construed to include any other gender, and words in the singular shall be held
and construed to include the plural, and vice versa, unless the context
otherwise requires.
4.8. Waiver, Discontinuance of Proceedings. Mortgagee may waive any single
default by Mortgagor hereunder without waiving any other prior or subsequent
default, and may remedy any default by Mortgagor hereunder without waiving the
default remedied. Neither the failure or delay by Mortgagee in exercising, any
right, power or remedy upon any default by Mortgagor hereunder shall be
construed as a waiver of such default or as a waiver of the right to exercise
any such right, power or remedy at a later date. No single or partial exercise
by Mortgagee of any right, power or remedy hereunder shall exhaust the same or
shall preclude any other or
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Further exercise thereof, and every such right, power or remedy hereunder may be
exercised at any time and from time to time. No modification or waiver of any
provision hereof nor consent to any departure by Mortgagor therefrom shall in
any event be effective unless the same shall be in writing and signed by
Mortgagee, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose given. No notice to nor demand on
Mortgagor in any case shall of itself entitle Mortgagor to any other or further
notice or demand in similar or other circumstances. Acceptance by Mortgagee of
any payment in an amount less than the amount. then due on any of the secured
indebtedness shall be deemed an acceptance on account only and shall not in any
way affect the existence of a default hereunder.
4.9. Section Headings. The headings of the sections and paragraphs of this
Mortgage are for convenience of reference only, are not to be considered a part
hereof and shall not limit or otherwise affect any of the terms hereof.
4.10. GOVERNING LAW, THIS MORTGAGE WILL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA, PROVIDED HOWEVER
THAT TO THE EXTENT THAT ANY OF SUCH LAWS MAY NOW OR HEREAFTER BE PREEMPTED BY
FEDERAL LAW, IN WHICH CASE SUCH FEDERAL LAW SHALL SO GOVERN AND BE CONTROLLING.
4.11. Counting of Days. The term "days" when used herein shall mean
calendar days. If any time period ends on a Saturday, Sunday or holiday
officially recognized by the state within which the Real Estate is located, the
period shall be deemed to end on the next succeeding business day. The terra
"Business Day" or "Business Day" when used herein shall mean a weekday, Monday
through Friday, except a legal holiday or a day on which banking institutions in
New York, New York are authorized by law to be closed.
4.12. Application of the Proceeds of the Note. To the extent that proceeds
of the Note are used to pay indebtedness secured by any outstanding lien,
security interest, charged or prior encumbrance against the Property, such
proceeds have been advanced by Mortgagee at Mortgagor's request and Mortgagee
shall be subrogated to any and all rights, security interests and liens owned by
any owner or holder of such outstanding liens, security interests, charges or
encumbrances, irrespective of whether said liens, security interests, charges or
encumbrances are released.
4.13. Unsecured Portion of Indebtedness. If any part of the secured
indebtedness cannot be lawfully secured by this Mortgage or if any part of the
Property cannot be lawfully subject to the lien and security interest hereof to
the full extent of such indebtedness, then all payments made shall be applied on
said indebtedness first in discharge of that portion thereof which is unsecured
by this Mortgage.
4.14. Cross Default. A default hereunder which has not been cured within
any applicable grace or cure period shall be a default under each of the other
Loan Documents.
4.15. Interest After Sale. In the event the Property or any part thereof
shall be sold upon foreclosure as provided hereunder, to the extent permitted by
law, the sure for which the
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same shall have been sold shall, for purposes of redemption (pursuant to the
laws of the state in which the Property is located), bear interest at the
Default Interest Rate.
4.16. Construction of this Document. This document may be construed as a
mortgage, security deed, deed of trust, chattel mortgage, conveyance,
assignment, security agreement, pledge, financing statement, hypothecation or
contract, or any one or more of the foregoing, in order to fully effectuate the
liens and security interests created hereby and the purposes and agreements
herein set forth.
4.17. No Merger. It is the desire and intention of the parties hereto that
this Mortgage and the lien hereof do not merge in fee simple title to the
Property.
4.18. Rights With Respect to Junior Encumbrances. Any person or entity
purporting to have or to take a junior mortgage or other lien upon the Property
or any interest therein shall be subject to the rights of Mortgagee to amend,
modify, increase, vary, alter or supplement this Mortgage, the Note or any of
the other Loan Documents and to extend the maturity date of the indebtedness
secured hereby and to increase the amount of the indebtedness secured hereby and
to waive or forebear the exercise of any of its rights and remedies hereunder or
under any of the other Loan Documents and to release any collateral or security
for the indebtedness secured hereby, in each and every case without obtaining
the consent of the holder of such junior lien and without the lien or security
interest of this Mortgage losing its priority over the rights of any such junior
lien.
4.19. Mortgagee May File Proofs of Claim. In the case of any receivership,
insolvency, bankruptcy, reorganization, arrangement, adjustment, composition or
other proceedings affecting Mortgagor or the principals, members or general
partners in Mortgagor, or their respective creditors or property, Mortgagee, to
the extent permitted by law, shall be entitled to file such proofs of claim and
other documents as may be necessary or advisable in order to have the claims of
Mortgagee allowed in such proceedings for the entire secured indebtedness at the
date of the institution of such proceedings and for any additional amount which
may become due and payable by Mortgagor hereunder after such date.
4.20. After-Acquired Property. All property acquired by Mortgagor after the
date of this Mortgage which by the terms of this Mortgage shall be subject to
the lien and the security interest created hereby, shall immediately upon the
acquisition thereof by Mortgagor and without further deed, conveyance or
assignment become subject to the lien and security interest created by this
Mortgage.
4.21. No Representation By accepting delivery of any item required to be
observed, performed or fulfilled or to be given to Mortgagee pursuant to the
Loan Documents, including, but not limited to, any officer's certificate,
balance sheet, statement of profit and loss or other financial statement,
survey, appraisal or insurance policy, Mortgagee shall not be deemed to have
warranted, consented to, or affirmed the sufficiency, legality, effectiveness or
legal effect of the same, or of any term, provision or condition thereof, and
such acceptance of delivery thereof shall not be or constitute any warranty,
consent or affirmation with respect thereto by Mortgagee.
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4.22. Counterparts. This Mortgage may be executed in any number of
counterparts, each of which shall be effective only upon delivery and thereafter
shall be deemed an original, and all of which shall be taken to be one and the
same instrument, for the same effect as if all parties hereto had signed the
same signature page.
4.23. Personal Liability. Notwithstanding anything to the contrary
contained in this Mortgage, the liability of Mortgagor and its general partners
for the indebtedness secured hereby and for the performance of the other
agreements, covenants and obligations contained herein and in the Loan Documents
shall be limited as set forth in Section 1.05 of the Note; provided, however,
that nothing herein shall be deemed to be a waiver of any right which Mortgagee
may have under Sections 506(a), 506(b), 1111(b) or any other provisions of the
U.S. Bankruptcy Code to file a claim for the full amount of the indebtedness
secured hereby or to require that all collateral shall continue to secure all
indebtedness owing to Mortgagee in accordance with the Note, this Mortgage and
the other Loan Documents,
4.24. Recording and Filing. Mortgagor will cause the Loan Documents and all
amendments and supplements thereto and substitutions therefor to be recorded,
filed, re-recorded and re-filed in such manner and in such places as Mortgagee
shall reasonably request, and will pay on demand all such recording, filing,
re-recording and re-filing taxes, fees and other charges. Mortgagor shall
reimburse Mortgagee, or its servicing agent, for the costs incurred in obtaining
a tax service company to verify the status of payment of taxes and assessments
on the Property.
4.25. Entire Agreement and Modifications,. This Mortgage and the other Loan
Documents contain the entire agreements between the parties and supersede any
prior agreements (oral or written), and may not be amended, revised, waived,
discharged, released or terminated orally but only by a written instrument or
instruments executed by the party against which enforcement of the amendment,
revision, waiver, discharge, release or termination is asserted.
4.26. Maximum Interest. The provisions of this Mortgage and of all
agreements between Mortgagor and Mortgagee, whether now existing or hereafter
arising and whether written or oral, are hereby expressly limited so that in no
contingency or event whatsoever, whether by reason of demand or acceleration of
the maturity of the Note or otherwise, shall the amount paid; or agreed to be
paid ("Interest"), to Mortgagee for the use, forbearance or retention of the
money loaned under the Note exceed the maximum amount permissible under
applicable law. If, from any circumstance whatsoever, performance or fulfillment
of any provision hereof or of any agreement between Mortgagor and Mortgagee
shall, at the time performance or fulfillment of such provision shall be due,
exceed the limit for Interest prescribed by law or otherwise transcend the limit
of validity prescribed by applicable law, then ipso facto the obligation to be
performed or fulfilled shall be reduced to such limit and if, from any
circumstance whatsoever, Mortgagee shall ever receive anything of value deemed
Interest by applicable law in excess of the maximum lawful amount, an amount
equal to any excessive Interest shall be applied to the reduction of the
principal balance owing under the Note in the inverse order of its maturity
(whether or not then due) or at the option of Mortgagee be paid over to
Mortgagor, and not to the payment of Interest. All Interest (including any
amounts or payments judicially or otherwise under law deemed to be Interest)
contracted for, charged, taken, reserved, paid or agreed to be paid to Mortgagee
shall, to the extent permitted by applicable law,
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be, amortized, prorated, allocated and spread throughout the full term of the
Note, including any extensions and renewal thereof, until payment in full of the
principal balance of the Note so that the Interest thereon for such full term
will not at any time exceed the maximum amount permitted by applicable law. This
Section 4.26 will control all agreements between Mortgagor and Mortgagee.
4.27. Application of Default Interest Rate Not a Waiver. Application of the
Default Interest Rate shall not be deemed to constitute a waiver of any default
or any rights or remedies of Mortgagee under this Mortgage, any other Loan
Document or applicable legal requirements, or a consent to any extension of time
for the payment or performance of any obligation with respect to which the
Default Interest Rate may be invoked.
4.28. Interest Payable by Mortgagee. Mortgagee shall cause funds in the
Replacement Reserve and TIC Reserve (the "Funds") to be deposited into interest
bearing accounts of the type customarily maintained by Mortgagee or its
servicing agent for the investment of similar reserves, which accounts may not
yield the highest interest rate then available. The Funds shall be held in an
account in Mortgagee's name (or such other account name as Mortgagee may elect)
at a financial institution or other depository selected by Mortgagee (or its
servicer) in its sole discretion (collectively, the "Depository Institution").
Mortgagor shall earn no more than an amount of interest on the Funds equal to an
amount determined by applying to the average monthly balance of such Funds the
quoted interest rate for the Depository Institution's money market savings
account, as such rate is determined from time to time (such allocated amount
being referred to as "Mortgagor's Interest"). Mortgagee or its Depository
Institution shall be entitled to report under Mortgagor's Federal tax
identification number, Mortgagor's Interest on the Funds. If the Depository
Institution does not have an established money market savings account (or if an
interest rate for such account cannot otherwise be determined in connection with
the deposit of such Funds), a comparable interest rate quoted by the Depository
Institution and acceptable to Mortgagee (or its servicer) in its reasonable
discretion shall be used. The amount of Mortgagor's Interest allocated to Funds
shall be added to the balance in the applicable Reserve, and shall be disbursed
for payment of the items for which other Funds in the applicable Reserve axe to
be disbursed.
4.29. Further Stipulations. The additional covenants, agreements and
provisions set forth in Exhibit. C attached hereto, if any, shall be a part of
this Mortgage and shall, in the event of any conflict between such further
stipulations and any of the other provisions of this Mortgage, be deemed to
control.
4.30. Relationship of the Parties. The relationship between Mortgagor and
Mortgagee is that of a borrower and a lender only and neither of those parties
is, nor shall it hold itself out to be, the agent, employee, joint venturer or
partner of the other party.
4.31. Fixture Filing. This Mortgage shall be effective from the date of its
recording as a financing statement filed as a fixture filing with respect to all
goods constituting part of the Property which are or are to become fixtures. The
mailing address of Mortgagor and the address of Mortgagee from which information
concerning the security interests may be obtained are set forth in Section 1.22
above.
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4.32. Cooperation With Rating Agencies and Investors. Mortgagor covenants
and agrees that in the event Mortgagee decides to include the Loan as an asset
of a Secondary Market Transaction (as defined herein), Mortgagor shall (a) at
Mortgagee's request, meet with representatives of the Rating Agencies and/or
investors to discuss the business and operations of the Property, and (b) permit
Mortgagee or its representatives to provide related information to the Rating
Agencies and/or investors, and (c) cooperate with the reasonable requests of the
Rating Agencies and/or investors in connection with all of the foregoing. For
purposes hereof, a "Secondary Market Transaction" shall be (a) any sale or
assignment of this Mortgage, Note and other Loan Documents to one or more
investors as a whole loan; (b) a participation of the Loan to one or more
investors, (c) any deposit of this Mortgage, the Note and the other Loan
Documents with a trust or other entity which may sell certificates or other
instruments to investors evidencing an ownership interest in the assets of such
trust or other entity, or (d) any other sale, assignment or transfer of the Loan
or any interest therein to one or more investors. If at any time during which
the Loan is an asset of a securitization or is otherwise an asset of any rated
transaction, "Rating Agency" shall mean the rating agency or rating agencies
that from time to time rate the securities, certificates or other instruments
issued in connection with such securitization or other transaction.
4.33. Pennsylvania Provisions. Pursuant to 42 Pa. C.S.A. Section 8144, this
Mortgage secures the unpaid balance of advances made, with respect to the
Property, for the payment of taxes, assessments, maintenance charges, insurance
premiums or costs incurred by Mortgagee for the protection of the Property or
the lien of this Mortgage, and expenses incurred by Mortgagee by reason of an
Event of Default, and the priority of the lien of such advances shall relate
back to the date of the recording of this Mortgage.
[NO FURTHER TEXT ON THIS PAGE]
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In WITNESS WHEREOF, Mortgagor, intending to be legally bound hereby, has
duly executed this Mortgage under seal as of the day and year first above
written.
MORTGAGOR:
XXXX XXXXXXXX XXXX, XX,
a Delaware limited partnership
By: Thor XX Xxxxxxxx Hill, LLC,
a Delaware limited liability company,
its general partner
By: /s/ XXX
------------------------------------
Name: XXX
Title: Managing Member
XXXX XXXXXXXX XXXX II, LP,
a Delaware limited partnership
By: Thor XX Xxxxxxxx Hill II, LLC,
a Delaware limited liability company,
its general partner
By: /s/ XXX
------------------------------------
Name: XXX
Title: Managing Member
The address of the within Mortgagee is:
Column Financial, Inc.
00 Xxxxxxx Xxxxxx Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
-------------------------------------
On behalf of the Mortgagee
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State/ Commonwealth of New York
County of New York
On this, the 5th day of June, 2003, before me Xxxxxxxx Xxxxxxxx, the undersigned
officer, personally appeared Xxxxxx X. Xxxx- known to me (or satisfactorily
proven) to be the managing member of Thor XX Xxxxxxxx Xxxx, LLC, a Delaware
limited liability company, which is the general partner of Xxxx Xxxxxxxx Hill,
LP, a Delaware limited partnership, and acknowledged that he as such managing
member being duly authorized to do so, executed the foregoing instrument on
behalf of such limited liability company manager of such limited partnership,
for the purposes therein contained,
In witness whereof, I hereunto set may hand and official seal.
/s/ XXXXXXXX X. XXXXXXXX
----------------------------------------
Notary Public is
XXXXXXXX X. XXXXXXXX
Notary Public, State of New York
No. 01 MI6082687
(Seal) Qualified in New York County
Commission Expires November 04, 0000
XXXXX/XXXXXXXXXXXX XX XXX XXXX
XXXXXX XX XXX XXXX
Xx this, the 5th day of June, 2003, before me Xxxxxxxx Xxxxxxxx, the undersigned
officer, personally appeared Xxxxxx X. Xxxx- known to me (or satisfactorily
proven) to be the, managing member of Thor XX Xxxxxxxx Xxxx II, LLC, a Delaware
limited liability company, which is the general partner of Xxxx Xxxxxxxx Hill
II, LP, a Delaware limited partnership, and acknowledged that HE as such
managing member being duly authorized to do so, executed the foregoing
instrument on behalf of such limited liability company, as manager of such
limited partnership, for the purposes therein contained.
In witness whereof, I hereunto set may hand and official seal.
/s/ XXXXXXXX X. XXXXXXXX
----------------------------------------
Notary Public
XXXXXXXX X. XXXXXXXX
Notary Public, State of New York
No. 0lMI602687
Qualified in New York County
Commission Expires November 04, 2006
EXHIBIT A
LEGAL DESCRIPTION
EXHIBIT B
PERMITTED EXCEPTIONS
EXHIBIT C
ADDITIONAL STIPULATIONS
C-1 Repair and Remediation Reserve. Prior to the execution of this
Mortgage, Mortgagee has caused the Property to be inspected and such inspection
has revealed that the Property is in need of certain maintenance, repairs and/or
remedial or corrective work. Contemporaneously with the execution hereof,
Mortgagor has established with the Mortgagee a reserve in the amount of
$6,875.00 (the "Repair and Remediation Reserve"), which amount represents 125%
of the estimated cost to complete such items of Deferred Maintenance (as defined
herein), by depositing such amount with Mortgagee. Mortgagor shall cause each of
the items described in that certain engineering report dated April 24, 2003 and
prepared by ComTech Services, Inc. ComTech Services, Inc. as reviewed and
commented on by a desktop review prepared by Certified Environments, Inc. dated
April 29, 2003 (all of the foregoing, the "Engineering Report"), relative to the
Property, a copy of which has been provided to, and receipt of which is hereby
acknowledged by, Mortgagor (the "Deferred Maintenance") to be completed,
performed, remediated and corrected to the satisfaction of Mortgagee and as
necessary to bring the Property into compliance with all applicable laws,
ordinances, rules and regulations on or before one year from the date hereof, as
such time period may be extended by Mortgagee in its sole discretion. So long as
no default hereunder or under the other Loan Documents has occurred and is
continuing (i) all sums in the Repair and Remediation Reserve shall be held by
Mortgagee in the Repair and Remediation Reserve to pay the costs and expenses of
completing the Deferred Maintenance, and (ii) Mortgagee shall, to the extent
funds are available for such purpose in the Repair and Remediation Reserve,
disburse to Mortgagor the amount paid or incurred by Mortgagor in completing,
performing, remediating or correcting the Deferred Maintenance upon (a) the
receipt by Mortgagee of a written request from Mortgagor for disbursement from
the Repair' and Remediation Reserve which shall include a certification by
Mortgagor that the applicable item of Deferred Maintenance has been completed in
accordance with the terms of this Mortgage, (b) delivery to Mortgagee of
invoices, receipts or other evidence satisfactory to Mortgagee verifying the
costs of the Deferred Maintenance to be reimbursed, (c) for any single Deferred
Maintenance item in excess of $20,000.00 (or for any Deferred Maintenance item
structural in nature), and prior to disbursement of the final $20,000.00,
delivery to Mortgagee of a certification from an inspecting architect, engineer
or other consultant reasonably acceptable to Mortgagee describing the completed
work, verifying the completion of the work and the value of the completed work
and, if applicable, certifying that the Property is, as a result of such work,
in compliance with all applicable laws, ordinances, rules and regulations
relating to the Deferred Maintenance so performed, and (d) delivery to Mortgagee
of affidavits, lien waivers or other evidence reasonably satisfactory to
Mortgagee showing that all materialmen, laborers, subcontractors and any other
parties who might or could claim statutory or common law liens and are
furnishing or have furnished materials or labor to the Property have been paid
all amounts due for such labor and materials furnished to the Property,
Mortgagee shall not. be required to make advances from the Repair and
Remediation Reserve more frequently than one time in any calendar month. In
making any payment from the Repair and Remediation Reserve, Mortgagee shall be
entitled to rely on such request from Mortgagor without any inquiry into the
accuracy, validity or contestability of any such amount No interest or other
earnings on. the funds contained in the Repair and Remediation Reserve shall be
paid to
Mortgagor and any interest or other earnings on funds deposited into the Repair
and Remediation Reserve shall be solely for the account of Mortgagee, In the
event that the amounts on deposit or available in the Repair and Remediation
Reserve are inadequate to pay the costs of the Deferred Maintenance, Mortgagor
shall pay the amount of such deficiency.
C-2 Replacement Reserve. As additional security for the indebtedness
secured hereby, Mortgagor shall establish and maintain at all times while this
Mortgage continues in effect a repair reserve (the "Replacement Reserve"), with
Mortgagee for payment of costs and expenses incurred by Mortgagor in connection
with capital improvements, repairs and replacements, including the performance
of work to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps,
driveways, balconies, porches, patios, exterior walls, exterior doors and
doorways, windows, carpets, appliances, fixtures, elevators and mechanical and
HVAC equipment (collectively the "Repairs). Commencing on the first monthly
payment date under the Note and continuing thereafter on each monthly payment
date under the Note, Mortgagor shall pay to Mortgagee, concurrently with the
monthly payment due under the Note, a deposit to the Replacement Reserve in an
amount equal to $517.83. So long as no default here under or under the other
Loan Documents has occurred and is continuing, (i) all sums in the Replacement
Reserve shall be held by Mortgagee in the Replacement Reserve to pay the costs
and expense of Repairs, and (ii) Mortgagee shall, to the extent funds are
available for such purpose in the Replacement Reserve, disburse to Mortgagor the
amount paid or incurred by Mortgagor in performing such Repairs within ten (10)
days following: (a) the receipt by Mortgagee of a written request from Mortgagor
for disbursement from the Replacement Reserve and a certification by Mortgagor
to Mortgagee that the applicable item of Repair has been completed; (b) the
delivery to Mortgagee of invoices, receipts or other evidence verifying the cost
of performing the Repairs; and (c) for disbursement requests (i) in excess of
$20,000.00 with respect to any single Repair, or (ii) for any single Repair that
is structural in nature, delivery to Mortgagee of (I) affidavits, lien waivers
or other evidence reasonably satisfactory to Mortgagee showing that all
materialmen, laborers, subcontractors and any other parties who might or could
claim statutory or common law Liens and are furnishing or have furnished
material or labor to the Property have been paid all amounts due for labor and
materials furnished to the Property; (2) a certification from an inspecting
architect or other third party acceptable to Mortgagee describing the completed
Repairs and verifying the completion of the Repairs and the value of the
completed Repairs; and (3) a new (or amended) certificate of occupancy for the
portion of the Improvements covered by such Repairs, if said new certificate of
occupancy was required by law, or a certification by Mortgagor that no new
certificate of occupancy was required by law. Mortgagee shall not be required to
make advances from the Replacement Reserve more frequently than one time in any
calendar month. In malting any payment from the Replacement Reserve, Mortgagee
shall be entitled to rely on such request from Mortgagor without any inquiry
into the accuracy, validity or contestability of any such amount. Mortgagee may,
at Mortgagor's expense (not to exceed $2,500.00 annually), make or cause to be
made during the term of this Mortgage an annual inspection of the Property to
determine the need, as determined by Mortgagee in its reasonable judgment, for
further Repairs of the Property. In the event that such inspection reveals that
further Repairs of the Property are required, Mortgagee shall provide Mortgagor
with a written description of the required Repairs and Mortgagor shall complete
such Repairs to the reasonable satisfaction of Mortgagee within ninety (90) days
(subject to force maj xxxx) after the receipt of such description from
Mortgagee, or such later date as may be approved by Mortgagee in its reasonable
discretion. Interest or other earnings on the funds
contained in the Replacement Reserve shall be credited to Mortgagor as provided
in Section 4.28 hereof in the event that the amounts on deposit or available in
the Replacement Reserve are inadequate to pay the cost of the Repairs, Mortgagor
shall pay the amount of such deficiency.
ARTICLE I COVENANTS OF MORTGAGOR 5
1.1. Warranties of Mortgagor 5
1.2. Defense of Title 10
1.3. Performance of Obligations 10
1.4. Insurance 10
1.5. Payment of Taxes 13
1.6. Tax and Insurance Impound Account 14
1.7. Tenant Improvements and Leasing Commissions Reserve. 14
1.8. Security Interest In Reserves 18
1.9. Casualty and Condemnation 19
1.10. Mechanics' Liens 22
1.11. Assignment of Leases and Rents 22
1.12. Leases and Licenses. 23
1.13. Alienation and Further Encumbrances. 24
1.14. Payment of Utilities, Assessments, Charges, Etc 29
1.15. Access Privileges and Inspections 29
1.16. Waste; Alteration of the Property 29
1.17. Zoning; Use 29
1,18. Financial Statements and Books and Records 30
1.19. Further Documentation 31
1.20.(a) Payment of Costs 31
1.21. Security Interest 32
1.22. Security Agreement 33
1.23, Easements and Rights-of-Way 34
1.24. Compliance with Laws 34
1.25. Additional Taxes 35
1.26. Mortgagor's Waivers 35
1.27. SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL. 36
1.28. Contractual Statute of Limitations 37
1.29. Management 37
1.30. Hazardous Materials and Environmental Concerns. 38
1.31. INDEMNIFICATION; SUBROGATION. 42
1.32. Covenants with Respect to Indebtedness; Operations
and Fundamental. Changes of Mortgagor 43
1.33. Litigation 45
1.34. ERISA 45
1.35. Defeasance. 46
ARTICLE II EVENTS OF DEFAULT 51. 2.1. Events of Default 51
ARTICLE III REMEDIES' 53
3.1. Remedies Available 53
3.2. Application of Proceeds 55
3.3. Right and Authority of Receiver or Mortgagee in the Event of
Default; Power of Attorney 56
3.4. Occupancy After Foreclosure 57
3.5. Notice to Account Debtors 57
3.6. Cumulative Remedies 58
3.7. Payment of Expenses 58
ARTICLE IV MISCELLANEOUS TERMS AND CONDITIONS 58
4.1. Time of Essence 58
4.2. Release of Mortgage 58
4.3. Action by Mortgagee 58
4.4. Notices 59
4.5. Successors and Assigns 60
4.6. Severability 60
4.7. Gender 60
4.8. Waiver; Discontinuance of Proceedings 60
4.9. Section Headings 61
4.10. GOVERNING LAW 61
4.11. Counting of Days 61
4.12. Application of the Proceeds of the Note 61
4.13. Unsecured Portion of Indebtedness 61
4.14. Cross Default 61
4.15. Interest After Sale 61
4.16. Construction of this Document 62
4.17. No Merger 62
4.18. Rights With Respect to Junior Encumbrances 62
4.19. Mortgagee May File Proofs of Claim 62
4.20. After-Acquired Property 62
4.21. No Representation 62
4.22. Counterparts 63
4.23. Personal Liability 63
4.24. Recording and Filing 63
4.25. Entire Agreement and Modifications 63
4.26. Maximum Interest 63
4.27. Application of Default Interest Rate Not a Waiver 64
4.28: Interest Payable by Mortgagee 64
4.29. Further Stipulations 64
4.30. Relationship of the Parties 64
4.31. Fixture Filing 64
4.32. Cooperation With Rating Agencies and Investors 65
XXXX XXXXXXXX XXXX, XX and
XXXX XXXXXXXX HILL II, LP
(collectively, Borrower)
to
COLUMN FINANCIAL, INC.,
(Lender)
ASSIGNMENT OF LEASES AND RENTS
Dated: As of June_____, 2003
Location: Philadelphia County, Pennsylvania
PREPARED BY AND UPON
RECORDATION RETURN TO:
Winston & Xxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
ASSIGNMENT OF LEASES AND RENTS
Loan No. 271089
THIS ASSIGNMENT OF LEASES AND RENTS (this "Assignment") made as of
June______, 2003, is by XXXX XXXXXXXX XXXX, XX, a Delaware limited partnership
("Chestnut I") and XXXX XXXXXXXX HILL II, LP, a Delaware limited partnership
(Chestnut II"), each having an address do Thor Equities, LLC, 000 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, (Chestnut I and Chestnut are, collectively,
"Borrower"), jointly and severally, to and in favor of COLUMN FINANCIAL, INC., a
Delaware corporation ("Lender"), whose address is 00 Xxxxxxx Xxxxxx, 0xx Xxxxx,
Xxx Xxxx, Xxx Xxxx 10010, Att: Xxxxxx Xxxxxx.
WITNESSETH:
THAT, WHEREAS, Borrower has executed a certain Promissory Note dated of
even date herewith (the "Note"), payable to the order of Lender in the stated
principal amount of TEN MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS
($10,500,000.00) (the "Loan"); and
WHEREAS, the Note is secured by, among other things, that certain Mortgage
and Security Agreement dated of even date herewith (the "Security Instrument"),
from Borrower, as mortgagor, encumbering that certain real property situated in
the County of Philadelphia, Commonwealth of' Pennsylvania, as is more
particularly described on Exhibit A attached hereto and incorporated herein by
this reference, and together with all buildings and other improvements now or
hereafter located thereon (collectively, the 'Improvements) (said real property
and the Improvements are hereinafter sometimes collectively referred to as the
'Property'); and
WHEREAS, Borrower is desirous of further securing to Lender the performance
of the terms, covenants and agreements hereof and of the Note, the Security
Instrument and each other document and agreement evidencing, securing,
guaranteeing or otherwise relating to the indebtedness evidenced by the Note
(the Note, the Security Instrument and such other documents and agreements, as
each of the foregoing may from time to time be amended, consolidated, renewed or
replaced, being collectively referred to herein as the "Loan Documents").
NOW, THEREFORE, in consideration of the making of the Loan evidenced by the
Note by Lender to Borrower and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Borrower does hereby
irrevocably, absolutely and unconditionally transfer, sell, assign, pledge and
convey to Lender, its successors and assigns, all of the right, title and
interest of Borrower in and to:
(a) any and all leases, licenses, rental agreements and occupancy
agreements of whatever form now or hereafter affecting all or any part of the
Property and any and all guarantees, extensions, renewals, replacements and
modifications thereof (collectively, the "Leases"); and
(b) all deposits (whether for security or otherwise), rents, issues,
profits, revenues, royalties, accounts, rights, benefits, and income of every
nature of and from the Property, including, without limitation, minimum rents,
additional rents, termination payments, forfeited security deposits, liquidated
damages following default and all proceeds payable under any policy of insurance
covering loss of rents resulting from untenantability due to destruction or
damage to the Property, together with- the immediate and continuing right to
collect and receive the same, whether now due or hereafter becoming due, and
together with all rights and claims of any kind that Borrower may have against
any tenant, lessee or licensee under the Leases or against any other occupant of
the Property (collectively, the "Rents").
TO HAVE AND TO HOLD the same unto Lender, its successors and assigns.
IT IS AGREED that, notwithstanding that this instrument is a present,
absolute and executed assignment of the Rents and of the Leases arid a present,
absolute and executed grant of the powers herein granted to Lender, Borrower is
hereby permitted, at the sufferance of Lender and at its discretion, and is
hereby granted a license by Lender, to retain possession of the Leases and to
collect and retain the Rents unless and until there shall be a default under the
terms of any of the Loan Documents, which default has not been cured within any
applicable grace or cure period. In the event of such uncured default, the
aforementioned license granted to Borrower shall automatically terminate without
notice to Borrower, and Lender may thereafter, without taking possession of the
Property, demand, collect (by suit or otherwise), receive and give valid and
sufficient receipts for any and all of the Rents or take possession of the
Leases, for which purpose Borrower does hereby irrevocably make, constitute and
appoint Lender its attorney in fact with full power to appoint substitutes or a
trustee to accomplish such purpose (which power of attorney shall be irrevocable
so long as any portion of the Loan is outstanding shall be deemed to be coupled
with an interest, shall survive the voluntary or involuntary dissolution of
Borrower and shall not be affected by any disability or incapacity suffered by
Borrower subsequent to the date hereof). Further, from and after such
termination, Borrower shall be the agent of Lender in collection of the Rents,
and any Rents so collected by Borrower shall be held in trust by Borrower for
the sole and exclusive benefit of Lender and Borrower shall, within one (I)
business thy after receipt of any Rents, pay the same to Lender to be applied by
Lender as hereinafter set forth. Further, from and after such uncured default
and termination of the aforementioned license, Lender shall have the right and
authority, without any notice whatsoever to Borrower and without regard to the
adequacy of the security therefore, to: (a) manage and operate the Property,
with full power to employ agents to manage the same; (b) demand, collect,
receive and xxx for the Rents, including those past due and unpaid; and (c) do
all acts relating to such management of the Property, including, but not limited
to, negotiation of new Leases, making adjustments of existing Leases,
contracting and paying for repairs and replacements to the Improvements and to
the fixtures, equipment and personal property located in the Improvements or
used in any way in the operation, use and occupancy of the Property as in the
sole subjective judgment and discretion of Lender may be necessary to maintain
the same in a tenantable condition, purchasing and paying for such additional
furniture arid equipment as in the sole subjective judgment of Lender may be
necessary to maintain a proper rental income from the Property, employing
necessary managers and other employees, purchasing fuel, providing utilities and
paying for all other expenses incurred in the operation of the Property,
maintaining adequate insurance coverage over hazards customarily insured against
and paying the premiums therefore. Lender may apply the Rents received by Lender
from the Property, after deducting the
costs of collection thereof, including, without limitation, attorneys' fees and
a management fee for any management agent so employed, against amounts expended
for repairs, upkeep, maintenance, service, fuel, utilities, taxes, assessments,
insurance premiums and such other expenses as Lender incurs in connection with
the operation of the Property and against interest, principal, required escrow
deposits and other sums which have or which may become due, from time to time,
under the terms of the Loan Documents, in such order or priority as to any of
the items so mentioned as Lender, in its sole subjective discretion, may
determine. The exercise by Lender of the rights granted Lender in this
paragraph, and the collection of the Rents and the application thereof as herein
provided, shall not be considered a waiver by Lender of any default under the
Loan Documents or prevent foreclosure of any liens on the Property nor shall
such exercise make Lender liable under any of the Leases, Lender hereby
expressly reserving all of its rights and privileges under the Security
Instrument and the other Loan Documents as fully as though this Assignment had
not been entered into.
Without limiting the rights granted hereinabove, in the event Borrower
shall fall to make any payment or to perform any act required under the terms
hereof and such failure shall not be cured within any applicable grace or cure
period, then Lender may, but shall not be obligated to, without prior notice to
or demand on Borrower, and without releasing Borrower from any obligation
hereof, make or perform the same in such manner and to such extent as Lender may
deem necessary to protect the security hereof, including specifically, without
limitation, appearing in and defending any action or proceeding purporting to
affect the security hereof or the rights or powers of Lender, performing or
discharging any obligation, covenant or agreement of Borrower under any of the
Leases, and, in exercising any of such powers, paying all necessary costs and
expenses, employing counsel and incurring and paying attorneys' fees. Any sum
advanced or paid by Lender for any such purpose, including, without limitation,
attorneys' fees, together with interest thereon at the Default Interest Rate (as
defined in the Note) from the date paid or advanced by Lender until repaid by
Borrower, shall immediately be due and payable to Lender by Borrower on demand
and shall be secured by the Security Instrument and by all of the other Loan
Documents securing all or any part of the indebtedness evidenced by the Note.
IT IS FURTHER AGREED that this Assignment is made upon the following terms,
covenants and conditions:
I. This Assignment shall not operate to place responsibility for the
control, care, management or repair of the Property upon Lender, nor for the
performance of any of the terms and conditions of any of the Leases, nor shall
it operate to make Lender responsible or liable for any waste committed on the
Property by the tenants or any other party or for any dangerous or defective
condition of the Property or for any negligence in the management, upkeep,
repair or control of the Property. Lender shall not be liable for any loss
sustained by Borrower resulting from Lender's failure or inability to collect
Rents, proceeds or other payments, or to let the Property, or from any other act
or omission of Lender in managing the Property. BORROWER SHALL AND DOES HEREBY
INDEMNIFY AND HOLD LENDER HARMLESS FROM AND AGAINST ANY AND ALL LIABILITY, LOSS,
CLAIM, DEMAND OR DAMAGE WHICH MAY OR MIGHT BE INCURRED BY REASON OF THIS
ASSIGNMENT, INCLUDING, WITHOUT LIMITATION, CLAIMS OR DEMANDS FOR SECURITY
DEPOSITS PROM TENANTS OF SPACE IN THE IMPROVEMENTS DEPOSITED WITH BORROWER, AND
FROM AND. AGAINST ANY AND ALL CLAIMS AND DEMANDS
WHATSOEVER WHICH MAY BE ASSERTED AGAINST LENDER BY REASON OF ANY ALLEGED
OBLIGATIONS OR UNDERTAKING ON ITS PART TO PERFORM OR DISCHARGE ANY OF THE TERMS,
COVENANTS OR AGREEMENTS CONTAINED IN ANY OF THE LEASES. SHOULD LENDER INCUR ANY
LIABILITY BY REASON OF THIS ASSIGNMENT OR IN DEFENSE OF ANY CLAIM OR DEMAND FOR
LOSS OR DAMAGE AS PROVIDED ABOVE, THE AMOUNT THEREOF, INCLUDING, WITHOUT
LIMITATION, COSTS, EXPENSES AND ATTORNEYS' FEES, TOGETHER WITH INTEREST THEREOF
AT THE DEFAULT INTEREST RATE FROM THE DATE PAID OR INCURRED BY LENDER UNTIL
REPAID BY BORROWER, SHALL BE IMMEDIATELY DUE AND PAYABLE TO LENDER BY BORROWER
UPON DEMAND AND SHALL BE SECURED BY THE SECURITY INSTRUMENT AND BY ALL OF THE
OTHER LOAN DOCUMENTS SECURING ALL OR ANY PART OF THE INDEBTEDNESS EVIDENCED BY
THE NOTE.
2. This Assignment shall not be construed as making Lender a mortgagee in
possession.
3. Lender is obligated to account to Borrower only for such Rents as are
actually collected or received by Lender.
4. Borrower hereby further presently and absolutely assigns to Lender
subject to the terms and provisions of this Assignment: (a) any award or other
payment which Borrower may hereafter become entitled to receive with respect to
any of the Leases as a result of or pursuant to any bankruptcy, insolvency or
reorganization or similar proceedings involving the tenants under such Leases;
and (b) any and all payments made by or on behalf of any tenant of any part of
the Property in lieu of Rent. Borrower hereby irrevocably appoints Lender as its
attorney- in fact to, from and after the occurrence of a default by Borrower
hereunder or under any of the other Loan Documents which has not been cured
within any applicable grace or cure period, appear in any such proceeding and to
collect any such award or payment, which power of attorney is coupled with an
interest by virtue of this Assignment and is irrevocable so long as any sums are
outstanding under the loan evidenced by the Note.
5. Borrower represents, warrants and covenants to and for the benefit of
Lender: (a) that Borrower now is (or with respect to any Leases not yet in
existence, will be immediately upon the execution thereof) the absolute owner of
the landlord's interest in the Leases, with full right and title to assign the
same and the Rents due or to become due thereunder; (b) that, other than this
Assignment and those assignments if any, specifically permitted in the Security
Instrument, there are no outstanding pledges or assignments of the Leases or
Rents; (c) that no Rents have been anticipated, discounted, released, waived,
compromised or otherwise discharged except for prepayment of rent of not more
than one (1) month prior to the accrual thereof; (d) that there are no material
defaults now existing under any of the Leases by the landlord or tenant; and, to
the best of Borrowers knowledge, there exists no state of facts which, with the
giving of notice or lapse of time or both, would constitute a default under any
of the Leases by the landlord or tenant; except as disclosed in writing to
Lender; (e) that Borrower has and shall duly and punctually observe and perform
all covenants, conditions and agreements in the Leases on the part of the
landlord to be observed and performed thereunder; and (f) the Leases are in full
force
and effect and are the valid and binding obligations of Borrower, and, to the
knowledge of Borrower, are the valid and binding obligations of the tenants
thereto.
6. Borrower covenants and agrees that Borrower shall not, without the prior
written consent of Lender: (a) exclusive of security deposits, accept any
payment of Rent or installments of Rent for more than one (I) month in advance;
(b) enter into any Lease having a term of less than six (6) months or in excess
of ten (10) years or in excess of 6,000 square feet (c) cancel or terminate any
Lease (other than for - non-payment of Rent or any other material default
thereunder) or amend or modify any Lease; (d) take or omit to take any action or
exercise any right or option which would permit the tenant under any Lease to
cancel or terminate said Lease; (e) anticipate, discount, release, waive,
compromise or otherwise discharge any Rents payable or other obligations under
the Leases; (0 further pledge, transfer, mortgage or otherwise encumber or
assign the Leases or future payments of Rents except as otherwise expressly
permitted by the terms of the Security Instrument or incur any material
indebtedness, liability or other obligation to any tenant, lessee or licensee
under the Leases; or (g) permit any Lease to become subordinate to any lien
other than the lien of the Security Instrument provided, however, that Borrower
may take any of the actions described in subsection (c) or (e) above so long as
such actions are taken by Borrower in tie ordinary course of business and are
consistent with sound customary leasing and management practices for similar
properties.
7. Borrower covenants and agrees that Borrower shall, at its sole cost and
expense, appear in and defend any action or proceeding arising under, growing
out of, or in any manner connected with the Leases or the obligations, duties or
liabilities of the landlord or tenant thereunder, and shall pay on demand all
costs and expenses, including, without limitation, attorneys' fees, which Lender
may incur in connection with Lender's appearance, voluntary or otherwise, in any
such action or proceeding, together with interest thereon at the Default
Interest Rate from the date incurred by Lender until repaid by Borrower.
8. At any time, Lender may, at its option, notify any tenants or other
parties of the existence of this Assignment. Borrower does hereby specifically
authorize, instruct and direct each and every present and future tenant, lessee
and licensee of the whole or any part of the Property to pay all unpaid and
future Rents to Lender upon receipt of demand from Lender to so pay the sane and
Borrower hereby agrees that each such present and future tenant, lessee and
licensee may rely upon such written demand from Lender to so pay said Rents
without any inquiry into whether there exists a default hereunder or under the
other Loan Documents or whether Lender is otherwise entitled to said Rents,
Borrower hereby waives any right, claim or demand which Borrower may now or
hereafter have against any present or future tenant lessee or licensee by reason
of such payment of Rents to Lender, and any such payment shall discharge such
tenant's, lessee's or licensee's obligation to make such payment to Borrower.
9. Lender may take or release any security for the indebtedness evidenced
by the Note, may release any party primarily or secondarily liable for the
indebtedness evidenced by the Note, may grant extensions, renewals or
indulgences with respect to the indebtedness evidenced by the Note and may apply
any other security therefore held by it to the satisfaction of any indebtedness
evidenced by the Note without prejudice to any of its rights hereunder.
10. The acceptance of this Assignment and the collection of the Rents in
the event Borrower's license is terminated, as referred to above, shall be
without prejudice to Lender. The rights of Lender hereunder are cumulative and
concurrent, may be pursued separately, successively or together and may be
exercised as often as occasion therefore shall arise, it being agreed by
Borrower that the exercise of any one or more of the rights provided for herein
shall not be construed as a waiver of any of the other rights or remedies of
Lender, at law or in equity or otherwise, so long as any obligation under the
Loan Documents remains unsatisfied.
11. All rights of Lender hereunder shall inure to the benefit of its
successors and assigns, and all obligations of Borrower shall bind its
successors and assigns and any subsequent owner of the Property. All rights of
Lender in, to and under this Assignment shall pass to and may be exercised by
any assignee of such rights of Lender. Borrower hereby agrees that if Lender
gives notice to Borrower of an assignment of said rights, upon such notice the
liability of Borrower to the assignee of the Lender shall be immediate and
absolute. Borrower will not set up any claim against Lender or any intervening
assignee as a defense, counterclaim or set-off to any action brought by Lender
or any intervening assignee for any amounts due hereunder or for possession of
or the exercise of rights with respect to the Leases or the Rents.
12. It shall be a default hereunder (a) if any representation or warranty
made herein by Borrower is determined by Lender to have been false or misleading
in any material respect at the time made, or (b) upon any failure by Borrower to
comply with the provisions of Paragraph 6 above or (c) upon any failure by
Borrower in the performance or observance of any other covenant or condition
hereof and, to the extent such failure described in this subsection (c) is
susceptible of being cured, the continuance of such failure for thirty (30) days
after written notice thereof from Lender to Borrower; provided, however, that if
such default is susceptible of cure but such cure cannot be accomplished with
reasonable diligence within said period of time, and if Borrower commences to
cure such default promptly after receipt of notice thereof from Lender, and
thereafter prosecutes the curing of such default with reasonable diligence, such
period of time shall be extended for such period of time as may be necessary to
cure such default with reasonable diligence, but not to exceed an additional
ninety (90) days. Any such default not so cured shall be a default under each of
the other Loan Documents, entitling Lender to exercise any or all rights and
remedies available to Lender under the terms hereof or of any or all of the
other Loan Documents, and any default under any other Loan Document which is not
cured within any applicable grace or cure period shall be deemed a default
hereunder subject to no grace or cure period, entitling Lender to exercise any
or all rights provided for herein, -
13. Failure by Lender to exercise any right which it may have hereunder
shall not be deemed a waiver thereof unless so agreed in writing by Lender, and
the waiver by Lender of any default hereunder shall not constitute a continuing
waiver or a waiver of any other default or of the same default on any future
occasion, No collection by Lender of any Rents pursuant to this Assignment shall
constitute or result in a waiver of any default then existing hereunder or under
any of the other Loan Documents.
14. If any provision under this Assignment or the application thereof to
any entity, person or circumstance shall be invalid, illegal or unenforceable to
any extent, the remainder of this Assignment and the application of the
provisions hereof to other entities, persons or
circumstances shall not be affected thereby and shall be enforced to the fullest
extent permitted by law.
15. This Assignment may not be amended, modified or otherwise changed
except by a written instrument duly executed by Borrower and Lender.
16. This Assignment shall be in full force and effect continuously front
the date hereof to and until the Security Instrument shall be released of
record, and the release of the Security Instrument shall, for all purposes,
automatically terminate this Assignment and render this Assignment null and void
and of no effect whatsoever.
17. All notices, demands, requests or other communications to be sent by
one party to the other hereunder or required by law shall be given and become
effective as provided in the Security Instrument.
18. THIS ASSIGNMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE COMMONWEALTH OP PENNSYLVANIA, EXCEPT TO THE EXTENT THAT ANY OF
SUCH LAWS MAY NOW OR HEREAFTER BE PREEMPTED BY FEDERAL LAW, IN WHICH CASE SUCH
FEDERAL LAW SHALL SO GOVERN AND BE CONTROLLING; PROVIDED HOWEVER THAT THE LAWS
OF THE STATE IN WHICH THE REAL PROPERTY ON EXHIBIT A ATTACHED HERETO IS LOCATED
SHALL GOVERN AS TO THE CREATION, PRIORITY AND ENFORCEMENT OF LIENS AND SECURITY
INTERESTS IN PROPERTY LOCATED IN SUCH STATE.
19. This Assignment may be executed in any number of counterparts, each of
which shall be effective only upon delivery and thereafter shall be deemed an
original, and all of which shall be taken to be one and the same instrument, for
the same effect as if all parties hereto had signed the same signature page. Any
signature page of this Assignment may be detached front any counterpart of this
Assignment without impairing the legal effect of any signatures thereon and may
be attached to another counterpart of this Assignment identical in form hereto
but having attached to it one or more additional signature pages.
20. In addition to, but not in lieu of, any other rights hereunder, Lender
shall have the right to institute suit and obtain a protective or mandatory
injunction against Borrower to prevent a breach or default, or to enforce the
observance, of the agreements, covenants, terms and conditions contained herein,
as well as the right to damages occasioned by any breach or default This
Assignment shall continue and remain in full force and effect during any period
of foreclosure with respect to the Property.
21. Borrower hereby covenants and agrees that Lender shall be entitled to
all of the rights, remedies and benefits available by statute, at law, in equity
or as a matter of practice for the enforcement and perfection of the intents and
purposes hereof. Lender shall, as a matter of absolute right, be entitled, upon
application to a court of applicable jurisdiction, to the appointment of a
receiver to obtain and secure the rights of Lender hereunder and the benefits
intended to be provided to Lender hereunder.
22. Notwithstanding anything to the contrary contained in this Assignment,
the liability of Borrower and its general partners for the indebtedness secured
hereby and for the
performance of the other agreements, covenants and obligations contained herein
and in the Loan Documents shall be limited as set forth in Section 1.05 of the
Note; provided, however, that nothing herein shall be deemed to be a waiver of
any right which Assignee may have under Sections 506(a), 506(b), 1111(b) or any
other provisions of the U.S. Bankruptcy Code to file a claim for the full amount
of the indebtedness secured hereby or to require that all collateral shall
continue to secure all indebtedness owing to Lender in accordance with the Note,
this Assignment and the other Loan Documents.
[NO FURTHER TEXT ON THIS PAGE]
IN WITNESS WHEREOF, Borrower, intending to be legally bound hereby, has
executed this Assignment as of the day and year first above written.
XXXX XXXXXXXX XXXX, XX,
a Delaware limited partnership
By: Thor XX Xxxxxxxx Hill, LLC,
a Delaware limited liability
company, its general partner
By:
------------------------------------
Name:
Title:
XXXX XXXXXXXX XXXX II, LP,
a Delaware limited partnership
By: Thor XX Xxxxxxxx Hill II, LLC, a
Delaware limited liability company,
its general partner
By:
------------------------------------
Name:
Title:
State/Commonwealth of New York County of New York
On this, the __________ day of June, 2003 before me _____________________, the
undersigned officer, personally appeared_______________________________- known
to me (or satisfactorily proven) to be the ______________________ of Thor XX
Xxxxxxxx Xxxx, LLC, a Delaware limited liability company, which is the general
partner of Xxxx Xxxxxxxx Hill, LP, a Delaware limited duly authorized to do so
partnership, and acknowledged that he/she as such _______________being duly
authorized to do so, executed the foregoing instrument on behalf of such
___________________________ as manager of such limited partnership, for the
purposes therein contained.
In witness whereof, I hereunto set may hand and official seal.
(Seal)
----------------------------------------
Notary Public
XXXXXXXX X. XXXXXXXX
Notary Public, State of New York
No. 01M16082687
Qualified in New York County
Commission Expires November 04, 0000
Xxxxx/Xxxxxxxxxxxx xx Xxx Xxxx
Xxxxxx xx Xxx Xxxx
Xx this, the ______ day of June 2003, before me _________________the undersigned
officer, personally appeared ___________________________- known to me (or
satisfactorily proven) to be the________________________ of Thor XX Xxxxxxxx
Xxxx II, LLC, a Delaware limited liability company, which is the general partner
of Xxxx Xxxxxxxx Hill II, LP, a Delaware limited partnership, and acknowledged
instrument on behalf of such __________________, as manager of such limited
partnership, for the purposes therein contained.
In witness whereof, I hereunto set may hand and official seal.
(Seal)
----------------------------------------
Notary Public
XXXXXXXX X. XXXXXXXX
Notary Public, State of New York
No. 01M16082657
Qualified in New York County
Commission Expires November 04, 2006
EXHIBIT A
PROPERTY DESCRIPTION
