1
EXHIBIT 10.56
COMMERCIAL MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FINANCING STATEMENT
THIS MORTGAGE is made this 29th day of August, 1996, by XXXXXXX OF
ALABAMA, INC., a Michigan corporation ("Borrower"), whose address is 6200
Elmridge, Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000, to Standard Federal Bank, a federal
savings bank ("Standard Federal"), whose address is 0000 Xxxx Xxx Xxxxxx Xxxx,
Xxxx, Xxxxxxxx 00000.
Borrower is justly indebted to Standard Federal in the principal
amount of Eight Million Seven Hundred Nine Thousand Four Hundred Seven Dollars
($8,709,407), together with interest thereon in accordance with a Promissory
Note (Term Loan) in the principal amount of $5,300,000 from Borrower to
Standard Federal of even date herewith, and a Promissory Note (Term Loan) in
the original principal amount of $3,578,852.00, dated July 17, 1996, on which
the current outstanding principal balance as of the date hereof is
$3,409,407,the liability under which (as well as other indebtedness) the
Borrower has assumed pursuant to a Loan Modification and Assumption Agreement
of even date herewith (the foregoing promissory notes are herein collectively
referred to as the "Note").
Notwithstanding anything to the contrary contained herein: (1) the
maximum principal amount of indebtedness secured by this Mortgage shall not
exceed $2,000,000.00 (the "Maximum Principal Amount"); (2) the Maximum
Principal Amount of indebtedness secured by this Mortgage shall be deemed to be
the first principal indebtedness to be advanced and the last principal
indebtedness to be repaid; (3) the security afforded by this Mortgage for the
indebtedness shall not be reduced by any payments or other sums applied to the
reduction of indebtedness so long as the total amount of outstanding principal
indebtedness exceeds the Maximum Principal Amount, and thereafter shall be
reduced only to the extent that any payments and other sums are actually
applied by Standard Federal to reduce the outstanding principal indebtedness to
an amount less than the Maximum Principal Amount; and (4) the limitation
contained in this paragraph shall only pertain to the principal indebtedness
secured by this Mortgage, and shall not be construed as limiting the amount of
interest, fees, expenses, indemnified amounts, or other indebtedness (except
principal indebtedness) secured hereby.
THEREFORE, in order to secure payment of the principal and interest of
such indebtedness according to the terms of the Note, and all other amounts
payable by Borrower thereunder, and any and all extensions and renewals
thereof, however evidenced, and the performance of the covenants and conditions
hereof, Borrower does hereby grant, bargain, sell, assign and convey to
Standard Federal, its successors and assigns forever, certain real property
owned by Borrower and situated in the State of Alabama, as more particularly
described in Exhibit "A" attached hereto (the "premises"), together
2
with (1) all the estate, title, interest and rights of Borrower in and to the
premises and all buildings and improvements of every kind and description now
or hereafter placed upon the premises or any part thereof, (2) all heretofore
or hereafter vacated alleys and streets abutting the premises, (3) all
furniture, fixtures, equipment and appliances, regardless of their character as
personal property, including, but not limited to, all lighting, heating,
cooling, ventilating, air conditioning, plumbing, sprinkling, communicating and
electrical systems, and machinery, appliances, fixtures and equipment
pertaining thereto, awnings, stoves, refrigerators, dishwashers, disposals,
incinerators, carpeting and drapes, and all other furniture, fixtures,
equipment and appliances of every type, nature and description, owned by
Borrower and now or at any time hereafter related to, affixed to, attached to,
placed upon or used in any way in connection with the use, occupancy or
operation of the premises (except leased equipment and trade fixtures which, in
either case, are readily removable without damaging or reducing the value or
utility of the premises or the improvements thereto), all of which furniture,
fixtures, equipment and appliances shall be deemed to be a part of the premises
and covered by the lien hereof, and (4) all of the rents, profits, and leases
thereof and the tenements, hereditaments, easements, privileges and
appurtenances thereto. (Any reference herein to the "Project" shall be deemed
to apply to the above described premises and to such buildings, fixtures,
furniture, equipment and appliances, and to the rents, profits and leases
thereof, and to such tenements, hereditaments, easements, privileges and
appurtenances, unless the context shall require otherwise.)
To have and to hold the Project, with all of the tenements,
hereditaments, easements, appurtenances and other rights and privileges
thereunto belonging or in any manner now or hereafter appertaining thereto, for
the use and benefit of and unto Standard Federal its successors and assigns
upon the conditions hereinafter set forth.
Borrower does hereby covenant, promise and agree to and with Standard
Federal, which covenants, promises and agreements shall, to the extent
permitted by law, be deemed to run with the land, as follows:
1. Covenant to Pay Indebtedness. Borrower shall pay the
principal and interest of Borrower's indebtedness to Standard Federal according
to the terms of the Note and shall pay the indebtedness to Standard Federal
according to the terms of any future advances secured by this Mortgage and
shall pay all other amounts provided herein.
2. Covenant of Title. At the time of the execution and delivery
of this Mortgage, Borrower is well and truly seized of the Project in fee
simple, free of all easements, liens and encumbrances whatever (other than
those easements of record as of
-2-
3
the date hereof and the rights of the public in any part of the Project used or
taken for road purposes), and will forever warrant and defend the title to the
Project unto Standard Federal, it successors and assigns, against any and all
other claims whatever, and the lien created hereby is and will be kept as a
first lien upon the Project and every part thereof, subject only to the
foregoing exceptions.
3. Taxes and Assessments. Until the debt secured hereby is fully
satisfied, Borrower will pay all taxes, assessments and all other charges and
encumbrances levied on the Project before any penalty for nonpayment attaches
thereto, and will deliver to Standard Federal, upon request, official receipts
showing such payment. Borrower also shall pay when due all taxes, assessments
and other charges and encumbrances that may be levied upon or on account of
this Mortgage or the indebtedness secured hereby or upon the interest or estate
in the Project created or represented by this Mortgage, whether levied against
Standard Federal or otherwise. In the event payment by Borrower of any tax
referred to in the foregoing sentence would result in the payment of interest
in excess of the rate permitted by law, then Borrower shall have no obligation
to pay the portion of such tax which would result in the payment of such
excess; provided, however, in such event, at any time after the enactment of a
law providing for such tax, Standard Federal, at its option, may declare the
entire principal balance of the indebtedness secured hereby, together with all
interest thereon, to be due and payable immediately, without notice.
4. Insurance. Until the debt secured hereby is fully satisfied,
Borrower will keep the Project continuously insured against loss by fire,
windstorm and other hazards, casualties and contingencies, including vandalism
and malicious mischief, in such amounts and for such periods as may be required
by Standard Federal. Borrower shall pay promptly when due all premiums for
such insurance and deliver to Standard Federal, without request, receipts
showing such payment. All insurance shall be carried in companies approved by
Standard Federal and the policies and renewals thereof shall be held by, and
pledged to, Standard Federal (unless Standard Federal shall direct or permit
otherwise) as additional security hereunder, and shall have attached thereto a
mortgagee clause acceptable to Standard Federal, making all loss or losses
under such policies payable to Standard Federal, its successors and assigns, as
its or their interest may appear. In the event of loss or damage to the
Project, Borrower shall give immediate notice in writing by mail to Standard
Federal, who may make proof of loss if not made promptly by Borrower.
In the event the amount of the loss is $ 200,000.00 or less, the
insurance proceeds shall be released to the Borrower, upon request by the
Borrower. Borrower shall be obligated to use such proceeds to restore or repair
the Project unless Standard Federal otherwise specifies in writing.
-3-
4
In the event the amount of the loss is greater than $ 200,000.00, each
insurance company concerned is hereby authorized and directed upon request by
Standard Federal, to make payment for such loss, to the extent of the
indebtedness hereby secured, directly to Standard Federal instead of to
Borrower and Standard Federal jointly. Provided there has occurred no Event of
Default hereunder nor any event which with notice or the passage of time or
both would become an Event of Default hereunder and further provided that
Standard Federal shall reasonably determine that sufficient funds are available
from insurance proceeds and any funds to be provided by Borrower to repair or
restore the Project within a reasonable time and that such repair or
restoration is economically feasible, Standard Federal agrees, upon request by
the Borrower, to apply the insurance proceeds to repair or restore the Project,
after reimbursement of all costs and expenses of Standard Federal in collecting
such proceeds, subject to the following terms and conditions:
(a) Standard Federal shall retain all insurance proceeds
in an escrow account bearing interest at pass book rates to be
disbursed to pay the costs of repair or restoration in accordance with
procedures reasonably established by Standard Federal.
(b) All plans and specifications for repair or
restoration shall be approved by Standard Federal prior to the
commencement of any repair or restoration, which approval shall not be
unreasonably withheld or delayed.
(c) All repair or restoration shall be done by or under
the direction of Borrower, shall be in accordance with the approved
plans and specifications, shall be in a workmanlike manner free from
all defects, shall be in compliance with all statutes, ordinances,
rules and regulations applicable thereto and shall be completed free
of all construction liens except those being contested in good faith
by appropriate proceedings and with respect to which Borrower shall
have provided Standard Federal satisfactory security.
(d) Standard Federal shall have the right, at Borrower's
expense, to inspect all repairs and restoration and, if Standard
Federal reasonably determines that any work or materials are not in
conformity with the approved plans and specifications or other
requirements of sub-paragraph (c) above, to stop the work and order
replacement or correction thereof by Borrower.
(e) Standard Federal shall not be obligated to make
disbursements more frequently than monthly and the remaining
undisbursed proceeds shall always be sufficient to meet the total
estimated remaining costs to complete the repair or restoration plus
10% of such costs.
-4-
5
(f) All insurance proceeds in excess of the amounts
necessary to repair or restore the Project may be applied, at Standard
Federal's option, to the outstanding principal balance under the Note
(without penalty for prepayment), to fulfill any other covenant herein
or any other obligation of Borrower to Standard Federal, or released
to Borrower.
In the event all of the conditions to the use of the insurance
proceeds to repair or restore the Project which are outlined above are not
satisfied, Standard Federal, at its option, may apply the insurance proceeds or
any part thereof, first, toward reimbursement of all costs and expenses of
Standard Federal in collecting such proceeds, and then, to the outstanding
principal balance under the Note (without any penalty for prepayment), to
fulfill any other covenant herein or any other obligation of Borrower to
Standard Federal, or to the restoration or repair of the Project.
Application by Standard Federal of any insurance proceeds to the
outstanding principal balance under the Note shall not excuse Borrower from
making the regularly scheduled payments due thereunder, nor shall such
application extend or reduce the amount of such payments. In the event of
foreclosure of this Mortgage or other transfer of title to the Project in
extinguishment of the indebtedness secured hereby, all right, title and
interest of Borrower in and to any insurance policies then in force shall pass
to the purchaser or grantee and Borrower hereby appoints Standard Federal its
attorney-in-fact, in Borrower's name, to assign and transfer all such policies
and proceeds to such purchaser or grantee.
5. Standard Federal's Right to Make Expenditures. Should an
Event of Default occur hereunder as a result of Borrower's failure to pay any
taxes or assessments or procure and maintain insurance or make necessary
repairs to the Project, Standard Federal may pay such taxes and assessments,
effect such insurance and make such repairs, and the monies so paid by it shall
be a further lien on the Project, payable forthwith, with interest at the
default rate set forth in the Note. Standard Federal may make advances
pursuant to this paragraph or to paragraph 7 without curing the Event of
Default and without waiving Standard Federal's right of foreclosure or any
other right or remedy of Standard Federal under this Mortgage. The exercise of
the right to make advances pursuant to this paragraph shall be optional with
Standard Federal and not obligatory and Standard Federal shall not be liable in
any case for failure to exercise such right or for failure to continue
exercising such right once having exercised it. Borrower's failure to pay
taxes and/or assessments assessed against the Project, or any installment
thereof, or any insurance premium upon policies covering the Project or any
part thereof, shall constitute waste (although the meaning of the term "waste"
shall not necessarily be limited to such nonpayment), and shall entitle
Standard Federal to all remedies provided for therein. Borrower further agrees
to and
-5-
6
does hereby consent to the appointment of a receiver under such statute, should
Standard Federal elect to seek such relief thereunder.
6. Escrow for Taxes and Insurance. Standard Federal, after the
occurrence of an Event of Default, shall be entitled to require Borrower to pay
to Standard Federal monthly such amounts as Standard Federal from time to time
estimates as necessary to create and maintain a reserve fund from which to pay
before the same become due all taxes, assessments and other charges and
encumbrances levied on the Project and premiums for insurance as are herein
covenanted to be paid by Borrower and when such taxes, assessments and other
charges and encumbrances and insurance premiums become due and payable,
Standard Federal shall pay the same to the extent funds are available from the
reserve fund; provided, however, that Standard Federal shall have no liability
for any failure to so pay taxes, assessments and other charges and encumbrances
or insurance premiums for any reason whatsoever. In the event that sufficient
funds have not been deposited as aforesaid to cover the amount of such taxes,
assessments and other charges and encumbrances and insurance premiums when the
same become due and payable, Borrower shall forthwith upon request by Standard
Federal pay such balance to Standard Federal. Standard Federal shall not be
required to pay Borrower any interest or earnings whatever on the funds held by
Standard Federal for the payment of such taxes, assessments and other charges
and encumbrances or for the payment of insurance premiums, or on any other
funds deposited with Standard Federal in connection with this Mortgage. Upon
the occurrence of an Event of Default under this Mortgage, any of such monies
then remaining on deposit with Standard Federal may be applied against the
indebtedness hereby secured immediately upon or at any time after the
occurrence of an Event of Default, and without notice to Borrower. Further,
Standard Federal may make payments from any of such monies on deposit with
Standard Federal for taxes, assessments, other charges or encumbrances or
insurance premiums on or with respect to the Project notwithstanding that
subsequent owners of the Project may benefit thereby.
7. Waste and Inspection and Repair. Borrower will abstain from
and will not suffer the commission of waste on the Project and will keep the
buildings, improvements, fixtures, equipment and appliances now or hereafter
thereon in good repair and will make replacements thereto as and when the same
become necessary. Borrower will comply promptly with all laws, ordinances,
regulations and orders of all public authorities having jurisdiction over the
Project relating to the use, occupancy and maintenance thereof, and shall upon
request promptly submit to Standard Federal evidence of such compliance.
Nothing herein shall be deemed to prohibit Borrower from contesting the
enforceability or applicability of any law, ordinance, regulation or order;
provided, however, that Standard Federal, in its sole discretion, may require
-6-
7
that Borrower comply with any such law, ordinance, regulation or order during
the pendency of any such contest and all appeals therefrom. In the event the
Project or any part thereof, in the sole reasonable judgment of Standard
Federal, requires inspection, repair, care or attention of any kind or nature
not theretofore provided by Borrower within 30 days after notice thereof from
Standard Federal to Borrower, or within such longer time as may be necessary if
the repair, care or attention is of a kind which cannot be completed in 30
days, provided that Borrower undertakes the repair, care or attention within 30
days after notice thereof from Standard Federal and thereafter diligently
pursues the completion of same within a reasonable time, Standard Federal may
(without being obligated to do so) enter or cause entry to be made upon the
Project and inspect, repair, and/or maintain the same as Standard Federal may
deem necessary or advisable, and may (without being obligated to do so) make
such expenditures and outlays of money as Standard Federal may deem appropriate
for the preservation of the Project. All expenditures and outlays of money
made by Standard Federal pursuant hereto shall be secured hereby, shall be
payable forthwith, and shall bear interest at the default rate provided in the
Note. Standard Federal shall have the right at any time, and from time to
time, to enter the Project for the purpose of inspecting the same. Borrower
will not permit the Project or any portion thereof to be used for any unlawful
purpose. No building or other improvement on any part of the Project shall be
removed, demolished or materially altered without the prior written consent of
Standard Federal, except that Borrower shall have the right, without such
consent, to remove and dispose of, free from the lien of this Mortgage, such
personalty and equipment as from time to time may become worn out or obsolete,
provided that (a) simultaneously with or prior to such removal, any such
equipment shall be replaced with other new equipment of like kind and quality,
free from any security interest, lien or encumbrances, and by such removal and
replacement, Borrower shall be deemed to have subjected the replacement
equipment to the lien of this Mortgage; and (b) any net cash proceeds received
from such disposition shall be promptly paid over to Standard Federal to be
applied to the outstanding principal balance under the Note, without any charge
for prepayment.
8. Events of Default. The occurrences listed below shall be
deemed Events of Default hereunder and shall entitle Standard Federal, at its
option and without notice except where required by law and as otherwise
provided herein, to exercise any one or any combination of remedies described
in paragraph 9 or otherwise available to Standard Federal:
(a) If any indebtedness of the Borrower to Standard Federal
is not paid within 10 days after the date due, regardless of whether
such indebtedness has arisen pursuant to the terms of the Note, or any
loan agreement, promissory note,
-7-
8
mortgage, security agreement, guaranty, instrument or other agreement
or otherwise.
(b) If any warranty or representation made by or for the
Borrower and/or any endorser or guarantor of the Note ("Guarantor") in
connection with the loan(s) evidenced thereby, or if any financial
data or any other information now or hereafter furnished to Standard
Federal by or on behalf of the Borrower and/or any Guarantor shall
prove to be false, inaccurate or misleading in any material respect,
and such default is not cured within 15 days after written notice to
the Borrower of such default.
(c) If the Borrower and/or any Guarantor shall fail to
perform any obligation or covenant hereunder, or shall fail to comply
with any of the provisions of the Note or of any loan agreement or
other agreement with Standard Federal to which it may be a party, and
such failure is not cured within 15 days after written notice to the
Borrower of such failure.
(d) If any other Event of Default shall occur under the
Note.
(e) If foreclosure or other proceedings to enforce any
second mortgage or any junior security interest, lien or encumbrance
of any kind upon the Project or any portion thereof are instituted and
are not dismissed, or insured against or bonded over in a manner
reasonably acceptable to Standard Federal within ninety (90) days.
(f) If Borrower fails to substantially comply with all of
the material terms, covenants and provisions of any and all leases or
other agreements, documents or restrictions that now encumber, affect
or pertain to the Project or any portion thereof.
9. Remedies. Immediately upon the occurrence of an Event of
Default defined in paragraph 8, Standard Federal shall have the option, in
addition to and not in lieu of or substitution for, all other rights and
remedies provided by law, to do any or all of the following:
(a) Without notice except as expressly required by law,
to declare the principal sum secured by this Mortgage, with all
interest thereon and all other sums secured hereby, to be immediately
due and payable, and if the same is not paid on demand, at Standard
Federal's option, to bring suit therefor; to demand payment of and if
the same is not paid on demand, to bring suit for any delinquent
installment payment under the Note or otherwise; to take any and all
steps and institute any and all other proceedings that Standard
Federal deems
-8-
9
necessary to enforce the indebtedness and obligations secured hereby
and to protect the lien of this Mortgage.
(b) Upon the occurrence of any Event of Default arising
out of the existence of any lien upon the Project, Standard Federal
shall have the right (without being obligated to do so or to continue
to do so), without notice to Borrower, to advance on and for the
account of Borrower such sums as Standard Federal in its sole
discretion deems necessary to cure such Event of Default or to induce
the holder of any such lien to forbear from exercising its rights
thereunder. The repayment of all such advances, with interest thereon
at the default rate set forth in the Note from the date of each such
advance, shall be secured hereby and shall be immediately due and
payable without demand.
(c) Judicial Proceedings: Right to Receiver. If an Event
of Default exists, Standard Federal, in lieu of or in addition to
exercising the power of sale hereinafter given, may proceed by suit to
foreclose its Lien on the Project, to xxx the Borrower for damages on
account of said default, for specific performance of any provision
contained herein, or to enforce any other appropriate legal or
equitable right or remedy. Standard Federal shall be entitled, as a
matter of right (upon xxxx filed or other proper legal proceedings
being commenced for the foreclosure of this Mortgage, to the extent
required by law), to the appointment by any competent court or
tribunal, without notice to the Borrower or any other party, of a
receiver of the rents, issues, profits and revenues of the Project,
with power to lease and control the Project and with such other powers
as may be deemed necessary.
(d) Power of Sale. If an Event of Default exists, this
Mortgage shall be subject to foreclosure and may be foreclosed as now
provided by law in case of past-due mortgages, and Standard Federal
shall be authorized, at its option, whether or not possession of the
Project is taken, to sell the Project (or such part or parts thereof
as Standard Federal may from time to time elect to sell) under the
power of sale which is hereby given to Standard Federal, at public
outcry, to the highest bidder for cash, at the front or main door of
the courthouse of the county in which the premises to be sold, or a
substantial and material part thereof, is located, after first giving
notice by publication once a week for three successive weeks of the
time, place and terms of such sale, together with a description of the
Project to be sold, by publication in some newspaper published in the
county or counties in which the premises to be sold is located. If
there is premises to be sold in more than one county, publication
shall be made in all counties where the premises to be sold is
located, but if no newspaper is published in any such county, the
notice shall be published in a newspaper
-9-
10
published in an adjoining county for three successive weeks. The sale
shall be held between the hours of 11:00 a.m. and 4:00 p.m. on the day
designated for the exercise of the power of sale hereunder. Standard
Federal may bid at any sale held under this Montage and may purchase
the Project, or any part thereof, if the highest bidder therefor. The
purchaser at any such sale shall be under no obligation to see to the
proper application of the purchase money. At any sale all or any part
of the Project, real, personal or mixed, may be offered for sale in
parcels or en masse for one total price, and the proceeds of any such
sale en masse shall be accounted for in one account without
distinction between the items included therein and without assigning
to them any proportion of such proceeds, the Borrower hereby waiving
the application of any doctrine of marshalling or like proceeding. In
case Standard Federal, in the exercise of the power of sale herein
given, elects to sell the Project in parts or parcels, sales thereof
may be held from time to time, and the power of sale granted herein
shall not be fully exercised until all of the Project not previously
sold shall have been sold or all the obligations secured by this
Mortgage shall have been paid in full and this Mortgage shall have
been terminated as provided herein.
(e) Personal Property and Fixtures. If an Event or
Default exists, Standard Federal shall have with respect to the
personal property at the Project all rights and remedies of a secured
party under the Alabama Uniform Commercial Code, including the right
to sell it at public or private sale or otherwise dispose of, lease or
use it, without regard to preservation of the personal property or its
value and without thenecessity of a court order. At Standard
Federal's request, theBorrower shall assemble the personal property
and make it available to Standard Federal at any place designated by
Standard Federal. To the extent permitted by law, the Borrower
expressly waives notice and any other formalities prescribed by law
with respect to any sale or other disposition of the personal property
or exercise of any other right or remedy upon default. The borrower
agrees that Standard Federal may sell or dispose of both the premises
and the personal property in accordance with the rights and remedies
granted under this Mortgage with respect to premises.
(f) Rents and Leases. If an Event of Default exists,
Standard Federal, at its option, shall have the right, power and
authority to terminate the license granted to the Borrower in this
Montage to collect the rents, profits, issues and revenues of the
Project, whether paid or accruing before or after the filing of any
petition by or against the Borrower under the federal Bankruptcy Code,
and, without taking possession, in Standard Federal's own name to
demand, collect, receive, xxx for, attach and levy all of such rents,
profits,
-10-
11
issues and revenues, to give proper receipts, releases and
acquittances therefor, and to apply the proceeds thereof as set forth
in sub-paragraph (h) hereof.
(g) Foreclosure Deeds. To the extent permitted by applicable
law, the Borrower hereby authorizes and empowers Standard Federal or
the auctioneer at any foreclosure sale had hereunder, for and in the
name of the Borrower, to execute and deliver to the purchaser or
purchasers of any of the Project sold at foreclosure good and
sufficient deeds of conveyance or bills of sale thereto.
(h) Order of Application of Proceeds. All payments received
by Standard Federal as proceeds of any of the Project, as well as any
and all amounts realized by Standard Federal in connection with the
enforcement of any right or remedy under this Montage, shall be
applied by Standard Federal as follows: a. to the payment of all
expenses incident to the exercise of any remedies under this Mortgage,
including attorneys' fees and disbursements as provided in the Note,
appraisal fees, environmental site assessment fees, title search fees
and foreclosure notice costs, b. to the payment in full of any of the
obligations that are then due and payable (including principal,
accrued interest and all other sums accrued hereby) in such order as
Standard Federal may elect in its sole discretion, c. to a cash
collateral reserve fund to be held by Standard Federal in an amount
equal to, and as security for, any of the obligations that are not
then due and payable, and d. the remainder, if any, shall be paid to
the Borrower or such other persons as may be entitled thereto by law,
after deducting therefrom the cost of ascertaining their identity.
(i) Multiple Sales. If an Event of Default exists, Standard
Federal shall have the option to proceed with foreclosure, either
through the courts or by power of sale as provided for in this
Mortgage, but without declaring the whole obligations secured hereby
due. Any such sale may be made subject to the unmatured part of such
obligations, and such sale, if so made, shall not affect the unmatured
part of the obligations, but as to such unmatured part of the
obligations this Mortgage shall remain in full force and effect as
though no sale had been made under this subparagraph. Several sales
may be made hereunder without exhausting the right of sale for any
remaining part of the obligations secured hereby, whether then matured
or unmatured, the purpose hereof being to provide for a foreclosure
and sale of the Project for any matured part of the obligations
without exhausting the power of foreclosure and the power to sell the
Project for any other part of the obligations, whether matured at the
time or subsequently maturing.
-11-
12
(j) Waiver of Certain Laws. The Borrower waives, to the
fullest extent permitted by law, the benefit of all laws now existing
or hereafter enacted providing for any appraisement before sale of any
portion of the Project (commonly known as appraisement laws), or any
extension of time for the enforcement of the collection of the
obligations or any creation or extension of a period of redemption
from any sale made in collecting the obligations (commonly known as
stay laws and redemption laws). The Borrower also waives any and all
rights the Borrower may have to a hearing before any governmental
authority prior to the exercise by Standard Federal of any of its
rights or remedies under the Note and applicable law.
(k) Prerequisites of Sales. In case of any sale of the
Project as authorized by this paragraph, all prerequisites to the sale
shall be presumed to have been performed, and in any conveyance given
hereunder all statements of facts, or other recitals therein made, as
to the nonpayment of any of the obligations or as to the advertisement
of sale, or the time, place and manner of sale, or as to any other
fact or thing, shall be taken in all courts of law or equity as
rebuttable presumptive evidence that the facts so stated or recited
are true.
(l) Foreclosure Reports. Procure mortgage foreclosure or
title reports. Borrower covenants to pay forthwith to Standard
Federal all sums paid for such purposes with interest at the default
rate provided for in the Note, and such sums and the interest thereon
shall constitute a further lien upon the Project.
(m) Appraisals, etc. Procure appraisals, environmental
audits and such other investigations or analyses of the Project as
Standard Federal may determine to be required by regulatory or
accounting rules, procedures or practices or to otherwise be prudent
or necessary. Borrower shall grant Standard Federal free and
unrestricted access to the Project for such purposes. Borrower
covenants to pay forthwith to Standard Federal all sums paid for such
purposes with interest at the default rate provided for in the Note,
and such sums and the interest thereon shall constitute a further lien
upon the Project.
(n) Possession. To enter into peaceful possession of the
Project and/or to receive the rent, income and profits therefrom, and
to apply the same in accordance with paragraph 17 hereof.
In the event of any sale of the Project by foreclosure, through suit
in equity, by publication or otherwise, the proceeds of any such sale shall be
applied in the following order of
-12-
13
priority: (1) to all expenses incurred for the collection of Borrower's
indebtedness and the foreclosure of the Mortgage, including reasonable
attorneys' fees as are permitted by law; (2) to all sums expended or incurred
by Standard Federal directly or indirectly in carrying out the covenants and
agreements of Borrower under this Mortgage, together with interest thereon;
(3) to all interest accrued under the Note; (4) to the principal balance of
the Note and the principal balance of any other indebtedness due from Borrower
to Standard Federal; and (5) the surplus, if any, shall be paid to Borrower,
unless a court of competent jurisdiction decrees otherwise.
10. Costs of Legal Proceedings. The Borrower shall pay Standard
Federal a reasonable attorney's fee in addition to all other legal costs in
case Standard Federal shall become a party, either as plaintiff or defendant,
to any legal proceedings in relation to the Project or the lien created hereby,
which sums shall be secured hereby and shall be payable forthwith at the
default rate set forth in the Note.
11. Eminent Domain. In the event the entire Project is taken
under the power of eminent domain, the entire award or payment in lieu of
condemnation, to the full extent of the amount secured hereby, shall be paid to
Standard Federal. Standard Federal shall apply such award or payment, first,
toward reimbursement of all of Standard Federal's costs and expenses incurred
in connection with collecting such award or payment, and then, at Standard
Federal's option, to the outstanding principal balance under the Note (without
any penalty for prepayment), to fulfill any other covenant herein or to any
other obligation of Borrower to Standard Federal.
In the event of a partial taking of the Project under the power of
eminent domain, the entire award or payment in lieu of condemnation, to the
full extent of the amount secured hereby, shall be paid over to Standard
Federal. Provided there has occurred no Event of Default hereunder, nor any
event which with notice or the passage of time or both would become an Event of
Default hereunder, and Standard Federal shall reasonably determine that
sufficient funds are available from the award or payment and any funds to be
provided by Borrower to repair or restore the remaining portion of the Project
within a reasonable time and that such repair or restoration is economically
feasible, Standard Federal agrees, upon request by the Borrower, to apply the
award or payment to repair or restore the remaining portion of the Project,
after reimbursement of all costs and expenses of Standard Federal in collecting
the award or payment, subject to the following terms and conditions:
(a) Standard Federal shall retain the award or payment in
an escrow account bearing interest at pass book rates to be disbursed
to pay the costs of repair or restoration in
-13-
14
accordance with procedures reasonably established by Standard Federal.
(b) All plans and specifications for repair or
restoration shall be approved by Standard Federal prior to the
commencement of any repair or restoration, which approval shall not be
unreasonably withheld or delayed.
(c) All repair or restoration shall be done by or under
the direction of Borrower, shall be in accordance with the approved
plans and specifications, shall be in a workmanlike manner free from
all defects, shall be in compliance with all statutes, ordinances,
rules and regulations applicable thereto and shall be completed free
of all construction liens except those being contested in good faith
by appropriate proceedings and with respect to which Borrower shall
have provided Standard Federal satisfactory security.
(d) Standard Federal shall have the right, at Borrower's
expense, to inspect all repairs and restoration and, if Standard
Federal reasonably determines that any work or materials are not in
conformity with the approved plans and specifications or other
requirements of sub-paragraph (c) above, to stop the work and order
replacement or correction thereof by Borrower.
(e) Standard Federal shall not be obligated to make
disbursements more frequently than monthly and the remaining
undisbursed proceeds shall always be sufficient to meet the total
estimated remaining costs to complete the repair or restoration plus
10% of such costs.
(f) All proceeds of the award or payment in excess of the
amounts necessary to repair or restore the Project may be applied, at
Standard Federal's option, to the outstanding principal balance under
the Note (without penalty for prepayment), to fulfill any other
covenant herein or any other obligation of Borrower to Standard
Federal, or released to Borrower.
In the event all of the conditions to the use of the award or payment
to repair or restore the Project which are outlined above are not satisfied,
Standard Federal, at its option, may apply the award or payment or any part
thereof, first, toward reimbursement of all costs and expenses of Standard
Federal in collecting such award or payment, and then, to the outstanding
principal balance under the Note (without any penalty for prepayment), to
fulfill any other covenant herein or any other obligation of Borrower to
Standard Federal, or to the restoration or repair of the Project.
Application by Standard Federal of any condemnation award or payment
or portion thereof to the outstanding principal balance
-14-
15
under the Note shall not excuse Borrower from making the regularly scheduled
payments due thereunder, nor shall such application extend or reduce the amount
of such payments. Standard Federal is hereby empowered in the name of Borrower
to receive, and give acquittance for, any such award or payment, whether it is
joint or several; provided, however, that Standard Federal shall not be held
responsible for failure to collect any such award or payment, regardless of the
cause of such failure.
12. Books and Records. The Borrower covenants and agrees to
furnish to Standard Federal promptly certificates of occupancy and such other
books, records, documents, information and statements pertaining to the
Borrower, the Project and its operations and any guarantor(s) as Standard
Federal may request. All books, records and other information provided by
Borrower hereunder shall be in a form that is acceptable to Standard Federal
and all costs of providing the same shall be borne entirely by Borrower.
13. Secondary Financing. Borrower will not, without the prior
written consent of Standard Federal, mortgage or pledge the Project or any part
thereof as security for any other loan or obligation of Borrower. If any such
mortgage or pledge is entered into without the prior written consent of
Standard Federal, the entire indebtedness secured hereby, may, at the option of
Standard Federal, be declared immediately due and payable without notice.
Further, Borrower also shall pay any and all other obligations, liabilities or
debts which may become liens, security interests, or encumbrances upon or
charges against the Project for any repairs or improvements that are now or may
hereafter be made thereon, and shall not, without Standard Federal's prior
written consent, permit any lien, security interest, encumbrance or charge of
any kind to accrue and remain outstanding against the Project or any part
thereof, or any improvements thereon, irrespective of whether such lien,
security interest, encumbrance or charge is junior to the lien of this
Mortgage. Notwithstanding the foregoing, if any personal property by way of
additions, replacements or substitutions is hereafter purchased and installed,
affixed or placed by Borrower on the Project under a security agreement, the
lien or title of which is superior to the lien created by this Mortgage, all
the right, title and interest of Borrower in and to any and all such personal
property, together with the benefit of any deposits or payments made thereon by
Borrower, shall nevertheless be and are hereby assigned to Standard Federal and
are covered by the lien of this Mortgage.
14. Payment Upon Acceleration Subject to Any Prepayment Penalty.
Upon the occurrence of an Event of Default by Borrower hereunder and following
the acceleration of maturity as provided in paragraph 9 hereof, a tender of
payment of the amount necessary to satisfy the entire indebtedness secured
hereby, made at any time prior to the foreclosure sale by Borrower, or by
anyone in behalf of the Borrower, shall constitute an evasion of the payment
terms
-15-
16
of the Note and shall be deemed to be a voluntary prepayment thereunder, and
any such payment, to the extent permitted by law, will therefore include the
premium required under the prepayment privilege, if any, contained in the Note.
15. Security Agreement and Financing Statements. Borrower shall
execute, acknowledge and deliver any and all such further conveyances,
documents, mortgages and assurances as Standard Federal may reasonably require
for accomplishing the purposes hereof, including financing statements required
by Standard Federal to protect its interest under the provisions of the Uniform
Commercial Code, as amended, forthwith upon the written request of Standard
Federal. Upon any failure of Borrower to do so, Standard Federal may execute,
record, file, re- record and refile any and all such documents for and in the
name of Borrower, and Borrower hereby irrevocably appoints Standard Federal as
agent and attorney-in-fact of Borrower for the foregoing purposes. This
instrument is intended by the parties to be, and shall be construed as, a
security agreement, as that term is defined and used in Article Nine of the
Uniform Commercial Code, as amended, and shall grant to Standard Federal a
security interest in that portion of the Project with respect to which a
security interest can be granted under Article Nine of the Uniform Commercial
Code, as amended, which security interest shall include a security interest in
all personalty owned by Borrower, whether now owned or subsequently acquired,
which is or in the future may be physically located on or affixed to the
Project described in Exhibit "A" hereto, regardless of whether such personalty
consists of fixtures under applicable law, a security interest in the proceeds
and products of the proceeds of all insurance policies now or hereafter
covering all or any part of such collateral. For purposes of Article Nine of
the Uniform Commercial Code, (a) Borrower herein is the "debtor", (b) Standard
Federal herein is the "secured party", (c) information concerning the security
interest created hereby may be obtained from Standard Federal at its address
set forth on page 1 hereof, and (d) Borrower's mailing address is that set
forth on page 1 hereof.
This Mortgage shall also be effective as a financing statement filed
as a fixture filing for purposes of Article 9 of the Uniform Commercial Code.
The fixture filing covers all goods that are or are to become affixed to the
premises. The goods are described by item or type on pages 1 and 2 of this
Mortgage. This Mortgage is signed by the debtor (Borrower) also as a fixture
filing. The real estate to which the goods are or to be affixed is described
in Exhibit A. The Borrower is a record owner of the real estate.
16. Assignment of Contracts and Agreements. Borrower hereby
assigns to Standard Federal, as further security for the indebtedness secured
hereby, Borrower's interest in all agreements, contracts (including contracts
for the lease or sale of the Project or any portion thereof), licenses and
permits affecting the
-16-
17
Project. Such assignment shall not be construed as a consent by Standard
Federal to any agreement, contract, license, or permit so assigned, or to
impose upon Standard Federal any obligations with respect thereto. Borrower
shall not cancel or amend any of the agreements, contracts, licenses and
permits hereby assigned (nor permit any of the same to terminate if they are
necessary or desirable for the operation of the Project), except in the
ordinary course of business, without first obtaining, on each occasion, the
written approval of Standard Federal. This paragraph shall not be applicable
to any agreement, contract, license or permit that terminates if it is assigned
without the consent of any party thereto (other than Borrower) or issuer
thereof, unless such consent has been obtained or this assignment is ratified
by such party or issuer; nor shall this paragraph be construed as a present
assignment of any agreement, contract, license or permit that Borrower is
required by law to hold in order to operate the Project for the purposes
intended.
17. Absolute Assignment of Leases and Rents. In further
consideration of Standard Federal making the loans evidenced by the Note and as
additional security for the payment of the indebtedness evidenced by the Note,
including interest thereon, and the performance of all of Borrower's
obligations hereunder or secured hereby, and under any other document executed
simultaneously or in connection herewith, Borrower does hereby grant, bargain,
sell, assign, transfer and set over unto Standard Federal all the rents,
profits and income under all leases or occupancy agreements or arrangements,
however evidenced or denominated, upon or affecting the Project (including any
extensions, amendments or renewals thereof), whether such rents, profits and
income are due or are to become due, including all such leases in existence or
coming into existence during the period this Mortgage is in effect. This
assignment shall run with the land until this Mortgage is discharged in full
and be good and valid as against Borrower and those claiming by, under or
through Borrower, from the date of recording of this Mortgage. This assignment
shall continue to be operative during the foreclosure or any other proceedings
taken to enforce this Mortgage. In the event of a foreclosure sale which
results in a deficiency, this assignment shall stand as security during the
redemption period for the payment of such deficiency. This assignment is an
absolute assignment of the rents, profits and income, as described beforesaid,
but shall not be construed as obligating Standard Federal to perform any of the
covenants or undertakings required to be performed by Borrower in any leases.
Borrower covenants and agrees not to cancel, accept a surrender of,
modify or alter (orally or in writing), reduce the rental under or consent to
the assignment or subletting of the lessee's interest in, any lease affecting
the Project, except in the ordinary course of business and on commercially
reasonable terms, or to make any other assignment, pledge or other disposition
of such leases, or any of them, or of the rents, issues and profits
-17-
18
derived from the use of the mortgaged premises. Any of the above acts, if done
without the written consent of Standard Federal, shall be null and void.
Borrower warrants and represents that all leases or copies of leases
which have been delivered to Standard Federal are in full force and effect and
there are no defaults existing thereunder, and that Borrower has not: (a)
executed any prior assignments presently subsisting of any leases or rentals
pertaining to the Project, (b) performed any acts or executed any other
instruments which might prevent or limit Standard Federal's operating under any
of the terms and conditions of this Mortgage, (c) executed or granted any
modification whatever of any lease pertaining to the Project which has not been
disclosed to Standard Federal, or (d) subordinated any lease to the lien of
this Mortgage, except on terms acceptable to Standard Federal.
Until the occurrence of an Event of Default hereunder, Borrower may
receive, collect and enjoy the rents and income from the Project. Upon the
occurrence of an Event of Default under this Mortgage, Standard Federal shall
be entitled to, at its option, to enter upon the Project, or any part thereof,
by its officers, agents, or employees, and: (a) collect the rents and income
from the Project as long as an Event of Default exists and during the pendency
of any foreclosure proceedings and, if there is a deficiency, during any
redemption period, (b) rent or lease the Project or any portion thereof upon
such terms and for such time as it may deem best, (c) operate or maintain the
Project, (d) maintain proceedings to recover rents or possession of the Project
from any tenant or trespasser, and apply the net proceeds of such rent and
income, after payment of all proper charges and expenses, to the following
purposes: (1) payment of all of the costs and expenses incurred by Standard
Federal in exercising its rights under this paragraph; (2) payment of interest
and principal due under the Note; (3) payment of all other sums secured hereby;
(4) payment of expenses of preserving the Project, including taxes and
insurance premiums. Notwithstanding the foregoing, Standard Federal, in its
sole discretion, may change the priorities set forth above for the application
of the net proceeds of such rent and income. The Borrower hereby authorizes
Standard Federal in general to perform all acts necessary for the operation and
maintenance of the Project in the same manner and to the same extent that the
Borrower might reasonably so act. Standard Federal shall only be accountable
for money actually received by it pursuant to the assignment contained in this
paragraph. Such entry and taking possession of the Project, or any part
thereof, by Standard Federal, may be made by actual entry and possession, or by
written notice served personally upon or sent by certified mail to the last
address of the Borrower appearing on the records of Standard Federal, as
Standard Federal may elect, and no further authorization or notice shall be
required. BORROWER HEREBY WAIVES ANY RIGHT TO NOTICE, OTHER THAN THE NOTICE
PROVIDED ABOVE AND WAIVES ANY RIGHT TO ANY HEARING
-18-
19
JUDICIAL OR OTHERWISE PRIOR TO STANDARD FEDERAL EXERCISING ITS RIGHTS UNDER THE
ASSIGNMENT CONTAINED IN THIS PARAGRAPH.
Standard Federal and its duly authorized agents shall be entitled to
enter the Project for the purpose of delivering any and all such notices and
other communications to the tenants and occupiers thereof or to take such other
steps as shall be necessary or desirable in Standard Federal's discretion to
exercise its rights hereunder, and Standard Federal and its agents shall have
absolutely no liability to Borrower arising therefrom, except for gross
negligence or willful misconduct. Standard Federal shall not, however, be
obligated to give any tenant or occupier of the Project any notice by personal
delivery and Standard Federal may, in its sole discretion, deliver all such
notices and communications by ordinary first-class U.S. mail, postage prepaid,
or otherwise.
The Borrower irrevocably consents that any lessee or lessees under any
leases covering the Project, upon demand and notice from Standard Federal of
Borrower's default under the Note or this Mortgage, shall pay all rents, issues
and profits under such leases to Standard Federal without any obligation upon
any such lessee or lessees for the determination of the actual existence of any
default.
In the event that Borrower obstructs Standard Federal in its efforts
to collect the rents and income from the Project, or after requested by
Standard Federal, unreasonably refuses, fails or neglects to assist Standard
Federal in collecting such rent and income, Standard Federal shall be entitled
to the appointment of a receiver of the Project and of the income, rents and
profits therefrom, with such powers as the court making such appointment may
confer.
The Borrower covenants and agrees to perform and discharge each and
every obligation, covenant, and agreement required to be performed by the
landlord under all leases covering the Project, and should the Borrower fail so
to do, then Standard Federal, but without obligation to do so, and without
releasing the Borrower from any obligation hereof, may make or do the same in
such manner and to such extent as Standard Federal may deem necessary to
protect the security hereof. Nothing herein contained shall be construed to
bind Standard Federal to perform any of the terms and provisions contained in
the leases, or otherwise to impose any obligation upon Standard Federal. Any
default by the Borrower in the performance of any of the obligations contained
in this paragraph, which is not cured within 30 days after notice thereof from
Standard Federal to Borrower, or, if the default is of a kind which cannot be
cured within 30 days, if Borrower fails to undertake the cure of such default
within 30 days after notice thereof from Standard Federal to Borrower and
thereafter diligently pursue such cure and complete it within a reasonable
time, shall constitute and be deemed to be a default under the terms of this
-19-
20
Mortgage entitling Standard Federal to exercise the rights and remedies
provided by this Mortgage.
Standard Federal shall at no time have any obligation whatever to
attempt to collect rent from any tenant or occupier of the Project
notwithstanding that such tenants and occupiers may not be paying rent to
either Borrower or to Standard Federal. Further, Standard Federal shall at no
time have any obligation whatever to enforce any other obligations owed by
tenants or occupiers of the Project to Borrower. No action taken by Standard
Federal under this Mortgage shall put Standard Federal in the position of a
"mortgagee in possession."
Borrower shall at no time collect advance rent under any lease upon,
affecting or pertaining to the Project or any part thereof in excess of one
month (other than as a security deposit) and Standard Federal shall not be
bound in any respect by any rent prepayment made or received in violation of
the terms hereof.
Standard Federal shall have the right to assign the Borrower's right,
title and interest in all leases covering the Project to any subsequent holder
of this Mortgage or the Note, and to assign the same to any person acquiring
title to the Project through foreclosure or otherwise.
18. Environmental Representations and Indemnity. The Borrower
represents and warrants to Standard Federal:
(a) Neither the Borrower nor, to the best of Borrower's knowledge
after due inquiry, any prior owner of the Project or any other person has
caused or permitted any waste, oil, pesticides, or any substance or material of
any kind which is currently known or suspected to be toxic or hazardous,
including but not limited to any substance defined as a "Hazardous Waste" in
Title 40, Part 261 of the Code of Federal Regulations, (hereinafter referred to
as "Hazardous Material") to be discharged, dispersed, released, stored,
treated, generated, disposed of, or allowed to escape on, under or at the
Project, nor has the Project, or any part thereof ever been used by the
Borrower or, to the best of Borrower's knowledge after due inquiry, any prior
owner of the Project or any other person, as a dump, storage or disposal site
for any Hazardous Material.
(b) To the best of Borrower's knowledge, no asbestos or
asbestos-containing materials have been installed, used, incorporated into, or
disposed of on the Project.
(c) To the best of Borrower's knowledge, no polychlorinated
biphenyls ("PCBs") are located on or in the Project, in the form of electrical
transformers, fluorescent light fixtures with ballasts, cooling oils, or any
other device or form.
-20-
21
(d) To the best of Borrower's knowledge, no underground storage
tanks are located on the Project or were located on the Project and
subsequently removed or filled.
(e) The Borrower (1) has not received any notice of any release or
threatened release of any Hazardous Materials in, under or upon the Project or
of any violation of any environmental or ecological protection laws or
regulations with respect to the Project, and (2) does not know of any basis for
any such notice or violation with respect to the Project.
Borrower hereby indemnifies Standard Federal and agrees to hold
Standard Federal harmless from and against any and all losses, liabilities,
damages, injuries, costs, expenses and claims of any and every kind whatsoever
paid, incurred or suffered by, or asserted against, Standard Federal for, with
respect to, or as a direct or indirect result of (a) the presence on or under,
or the escape, seepage, leakage, spillage, discharge, emission or release from,
the Project of any Hazardous Material, including, without limitation, any
losses, liabilities, damages, injuries, costs, expenses or claims, asserted or
arising under the federal Comprehensive Environmental Response, Compensation
and Liability Act of 1980, 42 U.S.C. Section 9601 et seq., or any other
federal, state or local statute, law, ordinance, code, rule, regulation, order
or decree regulating, relating to or imposing liability or standards of conduct
concerning, any Hazardous Material, the costs of any required or necessary
clean-up or detoxification of the Project, the costs of the preparation of any
clean-up or closure plans and reasonable attorney's fees and costs, or (b) the
presence of any asbestos on the Project (including, without limitation, the
cost of removal) regardless of whether or not caused by, or within the control
of, Borrower.
19. Due on Sale. Standard Federal in making the loan secured by
this Mortgage is relying upon the integrity of Borrower and its undertaking to
maintain the Project. If Borrower should (a) sell, transfer, convey or assign
the Project, or any right, title or interest therein, whether legal or
equitable, whether voluntarily or involuntarily, by outright sale, deed,
installment sale contract, land contract, contract for deed, leasehold interest
(other than leases to tenants) with a term greater than three years, lease
option contract or any other method of conveyance of real property interests;
or (b) cause, permit or suffer any change in the current ownership or
management of the Borrower; or (c) cause, permit or suffer any change in the
current management and control of the Project or in the degree of control
Borrower exercises or is empowered to exercise over the decisions affecting the
ownership and operation of the Project as of the date hereof, then, and in any
such event, Standard Federal shall have the right at its sole option thereafter
to declare all sums secured hereby and then unpaid to be due and payable
forthwith although the period limited for the payment thereof shall not then
have expired,
-21-
22
anything contained to the contrary hereinbefore notwithstanding, and thereupon
to exercise all of its rights and remedies under this Mortgage. If the
ownership of the Project, or any part thereof, becomes vested in a person other
than the Borrower (with or without Standard Federal's consent), Standard
Federal may deal with such successor or successors in interest with reference
to this Mortgage, and the indebtedness hereby secured, in the same manner as
with the Borrower, without in any manner vitiating, releasing or discharging
the Borrower's liability hereunder or upon the indebtedness hereby secured. No
sale of the Project and no forbearance or extensions by Standard Federal of the
time for payment of the indebtedness hereby secured or the performance of the
covenants and agreements herein provided shall in any way operate to release,
discharge, modify, change or affect the lien of this Mortgage or the liability
of Borrower on the Note or for the performance hereof, either in whole or in
part, and the Borrower shall at all times continue primarily liable on the
indebtedness secured hereby until this Mortgage is fully discharged or Borrower
is formally released by an instrument in writing duly executed by Standard
Federal.
20. Binding Effect. Until this Mortgage is discharged in full,
all of the covenants and conditions hereof shall run with the land and shall be
binding upon the successors and assigns of Borrower, and shall inure to the
benefit of the successors and assigns of Standard Federal. Any reference
herein to "Borrower" or "Standard Federal" shall include their respective
successors and assigns.
21. Notices. All notices, demands and requests required or
permitted to be given to Borrower hereunder or by law shall be deemed delivered
when deposited in the United States mail, with full postage prepaid thereon,
addressed to Borrower at the last address of Borrower on the records of
Standard Federal.
22. No Waiver. No waiver by Standard Federal of any right or
remedy granted hereunder shall affect or extend to any other right or remedy of
Standard Federal hereunder, nor affect the subsequent exercise of the same
right or remedy by Standard Federal for any further or subsequent Event of
Default by Borrower hereunder, and all such rights and remedies of Standard
Federal hereunder are cumulative. Time is of the essence.
23. Severability. If any provision(s) hereof are in conflict with
any statute or rule of law or are otherwise unenforceable for any reason
whatever, then such provision(s) shall be deemed null and void to the extent of
such conflict or unenforceability, but shall be deemed separable from and shall
not invalidate any other provisions of this Mortgage.
24. Pronouns. If more than one person joins in the execution
hereof, or is of the feminine sex, or a corporation, the pronoun
-22-
23
and relative words herein used shall be read as if in plural, feminine or
neuter, respectively.
25. Defeasance. This Mortgage is made upon the condition that if (a)
all of the indebtedness of the Borrower secured hereunder, including all future
advances and other future indebtedness, obligations and liabilities included
therein are paid in full, and (b) the Borrower reimburses Standard Federal for
any amounts Standard Federal has paid in respect of liens, impositions, prior
mortgages, insurance premiums, repairing or maintaining the Project, performing
the Borrower's obligations under any lease related to the Project, performing
the Borrower's obligations under environmental matters, and any other
advancements hereunder, and interest thereon, and (c) the Borrower fulfills all
of the Borrower's other obligations under this Mortgage, and (d) Standard
Federal has no obligations to extend any further credit to or for the account
of the Borrower that is secured by this Mortgage, and (e) any other conditions
set forth in paragraph 26 hereof are fulfilled, this conveyance shall be null
and void upon the filing by Standard Federal of the written instrument of
termination described in Paragraph 26 hereof.
26. Termination. This Mortgage and Standard Federal's liens under
this Mortgage in the Project will not be terminated until a written mortgage
satisfaction instrument executed by one of Standard Federal's officers is filed
for record in the county in which the premises is located. Except as otherwise
expressly provided in this Mortgage, no satisfaction of this Montage shall in
any way affect or impair the representations, warranties, agreements or other
obligations of the Borrower or the powers, rights and remedies of Standard
Federal under this Mortgage with respect to any transaction or event occurring
prior to such satisfaction, all of which shall survive such satisfaction. Even
if any of the obligations owing to Standard Federal at any one time should be
paid in full this Mortgage will continue to secure any obligations that might
later be owed to Standard Federal until such mortgage satisfaction instrument
has been executed and recorded. In no event shall Standard Federal be
obligated to satisfy its liens under this Mortgage or return or release any of
the Project to the Borrower (a) until the payment in full or all obligations
then outstanding, (b) if Standard Federal is obligated to extend credit to the
Borrower, (c) if any contingent obligation of the Borrower to Standard Federal
remains outstanding or (d) until the expiration of any period for avoiding or
setting aside any payment to Standard Federal remains outstanding or (d) until
the expiration of any period for avoiding or setting aside any payment to
Standard Federal under bankruptcy or insolvency laws.
27. Assignments. Standard Federal shall have the right to assign
(in whole or in part), transfer or sell participation in its rights under this
Mortgage without limitation. Any assignee or
-23-
24
transferee shall be entitled to all the benefits afforded Standard Federal
under this Mortgage.
IN WITNESS WHEREOF, this Mortgage was executed and delivered by the
undersigned on the day and year first above written.
WITNESSES: BORROWER:
XXXXXXX OF ALABAMA, INC., a Michigan
corporation
By:
------------------------- --------------------------------
Xxxx X. Xxxxxxxx
Its: Secretary/Treasurer
------------------------- --------------------------
STATE OF MICHIGAN )
) ss
COUNTY OF OAKLAND )
I, the undersigned authority, a Notary Public in and for said County
in said State, hereby certify that Xxxx X. Xxxxxxxx, whose name as
Secretary/Treasurer of XxXxxxx of Alabama, Inc., a Michigan corporation, is
signed to the foregoing instrument, and who is known to me, acknowledged before
me on this day that, being informed of the contents of said instruments,
he/she, as such officer and with full authority, executed the same voluntarily
for and as the act of said corporation.
Given under my hand and official seal this 29th day of August, 1996
-----------------------------------
Notary Public,
---------------------
County, Michigan
My commission expires:
--------------
THIS INSTRUMENT PREPARED BY AND WHEN RECORDED RETURN TO:
Xxxxxx X. Xxxxxx, Esq.
Standard Federal Bank, a federal savings bank
0000 Xxxx Xxx Xxxxxx Xxxx
Xxxx, Xxxxxxxx 00000
-24-
25
"EXHIBIT A"
LEGAL DESCRIPTION
A partel of land lying and being in Section 11. Township 17 North, Range 1
East. Range 1 East, Marengo County, Alabama, containing 88.1 acres more or
less, and being more particularly described as follows:
Commence at the southwest corner of the Northeast Quarter of the Southwest
Quarter of said Section 11; thence run north Q1'50' west along the west
boundary of said Northeast Quarter of Southwest Quarter a distance of 82.6 feet
to a concrete monument set to xxxx the point of beginning; thence run north
40'29' east parallel to and 350 feet perpendicular from the centerline of the
existing runway No.4 of the Demopolis Airport a distance of 3,245.9 feet to a
concrete monument set 600 feet perpendicular from the centerline of existing
runway No.13 of the said Demopolis Airport; thence run north 51'55' west and
parallel to said runway No. 13 a distance of 1,568.8 feet to a concrete
monument set on the southeast boundary of a cemetery; thence run south 38'05'
west a distance of 20.0 feet to a concrete monument set at the southern most
corner of said cemetery; thence run north 51'55' west along the southwest
boundary of said cemetery a distance of 43.2 feet to a concrete monument set
near the left bank of the Tombigbee River; thence southwestwardly along the
southeast edge of said Tombinee River to the point of intersection of said
river and the west boundary of the Southeast Quarter of the Northwest Quarter
of Section 11, said course follows generally among amender line described as;
from last named concrete monument run south 47'04' est a distance of 515.2 feet;
thence run south 50'42' west a distance of 370.0 feet to a concrete monument
found on the said west boundary of the Southeast Quarter of the Northwest
Quarter near the left bank of said river; thence run south 01'50' east and
along the west boundary of said Southeast Quarter of Northwest Quarter and
Northeast Quarter of Southwest Quarter a distance of 2,590.2 feet to the point
of beginning.
LESS AND EXCEPT THE FOLLOWING DESCRIBED TRACT HERETOFORE CONVEYED TO ALABAMA
POWER COMPANY AND MORE PARTICULARLY DESCRIBED AS FOLLOWS:
