This document was
prepared by:
Xxxxxxx Xxxxxxxx, Esq.
MORTGAGE AND SECURITY AGREEMENT
USA DETERGENTS, INC.,
MORTGAGOR
IN FAVOR OF
101 REALTY ASSOCIATES, L.L.C.
MORTGAGEE
DATED: AS OF FEBRUARY 25, 1998
THIS INSTRUMENT AFFECTS REAL AND PERSONAL PROPERTY SITUATED IN THE STATE OF NEW
JERSEY, COUNTY XX XXXXXXXXX, XXXXXXXX XX XXXXX XXXXXXXXX, XXXXX 143, LOT 18.3.
KNOWN BY THE XXXXXX XXXXXXX XX 0000 XXXXX 0 XXXXX.
THIS INSTRUMENT IS TO BE FILED AND INDEXED IN THE REAL ESTATE RECORDS AND IS
ALSO TO BE INDEXED IN THE INDEX OF FINANCING STATEMENTS UNDER THE NAMES OF
MORTGAGOR, AS "DEBTOR", AND MORTGAGEE, AS "SECURED PARTY".
Record and Return to:
Fulbright & Xxxxxxxx L.L.P.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxxx, Esq.
THIS MORTGAGE AND SECURITY AGREEMENT (this "Mortgage") is
made as of the 25th day of February, 1998, by USA Detergents, Inc., a Delaware
corporation ("Mortgagor"), whose address is 0000 Xxxxxx Xxxxxx, Xxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000, in favor of 101 REALTY ASSOCIATES, L.L.C. a New
Jersey limited liability corporation ("Mortgagee"), whose address is 000
Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000.
W I T N E S S E T H:
THAT FOR AND IN CONSIDERATION OF THE SUM OF TEN AND NO/100
DOLLARS ($10.00), AND OTHER VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY
OF WHICH IS HEREBY ACKNOWLEDGED. MORTGAGOR HEREBY IRREVOCABLY MORTGAGES,
GRANTS, BARGAINS, SELLS, CONVEYS, TRANSFERS, PLEDGES, SETS OVER AND ASSIGNS,
AND GRANTS A SECURITY INTEREST, TO 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 at 0000 Xxxxx Xxx
Xxxxx, Xxxxxx of Middlesex, Township of North Brunswick, State of New Jersey,
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
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 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, air rights and other
development rights 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
Real Estate and/or Improvements or any part thereof, or which hereafter shall
in any way belong, relate or be appurtenant thereto, whether now owned or
hereafter acquired by Mortgagor;
D. All water, ditches, xxxxx, reservoirs and drains and all
water, ditch, well, reservoir and drainage rights which are appurtenant to,
located on, under or above or used in connection with the Real Estate or the
Improvements, or any part thereof, whether now existing or hereafter created or
acquired;
E. All minerals, crops, timber, trees, shrubs, flowers and
landscaping features now or hereafter located on, under or above the Real
Estate;
F. 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);
G. All leases (including, without limitation, oil, gas and
mineral leases), licenses, concessions and occupancy agreements of all or any
part of the Real Estate or the Improvements now or hereafter entered into
(each, a "Lease" and collectively, the "Leases") and all rents, royalties,
issues, profits, revenue, income and other benefits (collectively, the "Rents
and Profits") of the Real Estate or the Improvements, now or hereafter arising
from the use or enjoyment of all or any portion thereof or from any present or
future Lease 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 deposited to secure performance
by the tenants, lessees or licensees, as applicable (each, a "Tenant" and
collectively, the "Tenants"), of their obligations under any such Leases,
whether said cash or securities are to be held until the expiration of the
terms of said Leases 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 hereinbelow;
H. 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, drawings, surveys, tests, reports, bonds and
governmental approvals) or to the management or operation of any part of the
Real Estate or the Improvements;
I. 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;
J. 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");
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K. All water taps, sewer taps, certificates of occupancy,
permits, 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;
L. All architectural renderings, models, drawings, plans,
specifications, studies and data now or hereafter relating to the Real Estate
or the Improvements;
M. 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;
N. All proceeds, products, substitutions and accessions
(including claims and demands therefor) 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 proceeds
of refunds of any taxes or assessments levied against the Property with respect
to any period in which this Mortgage encumbers the Property;
O. 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; and
P. All sums held by or under the control of the holder of the
Prior Mortgage, as that term is defined in Section 4.30 hereof, that were
deposited on account of real estate taxes, insurance premiums or otherwise.
FOR THE PURPOSES OF SECURING:
(1) The debt evidenced by that certain promissory
note (such promissory note, together with any and all renewals, modifications,
consolidations and extensions thereof, is hereinafter referred to as the
"Note") of even date with this Mortgage, made by Mortgagor to the order of
Mortgagee in the original principal amount of Four Million and No/100 Dollars
($4,000,000), together with interest 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, guarantying, securing or otherwise relating to the
indebtedness evidenced by the Note, including, but not limited to, the
Hazardous Substances Indemnity Agreement, of even date herewith, from Mortgagor
to Mortgagee (as hereinafter defined) (the Note, this Mortgage, and such other
agreements, documents and instruments, together with any and all renewals,
amendments, 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;
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(3) Any and all additional advances 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); and
(4) Any and all other indebtedness now owing or
which may hereafter be owing by Mortgagor to Mortgagee, including, without
limitation, all prepayment fees, 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, consolidations, 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").
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 and the other Loan Documents,
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
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:
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(a) Mortgagor has good and marketable fee simple
title to the Property, subject only to those matters expressly listed as
exceptions to title or subordinate matters in the title insurance policy
accepted by Mortgagee in connection with this Mortgage, excepting therefrom all
preprinted and/or standard exceptions (the "Permitted Exceptions"), and has
full power and lawful authority to grant, bargain, sell, convey, assign,
transfer and mortgage its interest in the Property in the manner and form
hereby done or intended. 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 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;
(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, or any guarantor or indemnitor under any guaranty or indemnity agreement
executed in connection with the Note or the loan evidenced thereby and secured
hereby;
(c) All reports, certificates, affidavits,
statements and other data furnished by or on behalf of Mortgagor or any
guarantor or indemnitor to Mortgagee in connection with the loan evidenced by
the Note are true and correct 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, 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,
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) The Real Estate and the Improvements, and the
intended use thereof by Mortgagor comply in all material respects 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 one or more separate
tax parcels for purposes of ad valorem taxation. The Real Estate and
Improvements do not require any rights over, or restrictions against, other
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property in order to comply with any of the aforesaid governmental ordinances,
orders or requirements.
(f) 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 approved by Mortgagee;
(g) 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;
(h) 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;
(i) 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 the Property which, if adversely determined, would materially
impair either the Property or Mortgagor's ability to perform the covenants or
obligations required to be performed under the Loan Documents:
(j) The Property is free from delinquent water
charges, sewer rents, taxes and assessments:
(k) As of the date of this Mortgage, the Property is
free from unrepaired damage caused by fire, flood, accident or other casualty;
(l) As of the date of this Mortgage, 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;
(m) Mortgagor possesses all franchises, patents,
copyrights, trademarks, trade names, licenses and permits adequate for the
conduct of its business substantially as now conducted;
(n) 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
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heating and air conditioning systems and the electrical and plumbing systems,
are in good working order and condition;
(o) Mortgagor has delivered to Mortgagee true,
correct and complete copies of all Contracts and all amendments thereto or
modifications thereof;
(p) Mortgagor and the Property are free from any
past due obligations for sales and payroll taxes;
(q) Other than the Prior Mortgage, as defined in
Section 4.30 hereof, there are no security agreements or financing statements
affecting any of the Property other than (i) as disclosed in writing by
Mortgagor to Mortgagee prior to the date hereof and (ii) the security
agreements and financing statements created in favor of Mortgagee;
(r) 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 Real
Estate is located. Mortgagor hereby disclaims and renounces each and every
claim to all or any portion of the Property as a homestead;
(s) Each Contract constitutes the legal, valid and
binding obligation of Mortgagor and, to the best of Mortgagor's knowledge and
belief, is enforceable against any other party thereto. No default exists, or
with the passing of time or the giving of notice or both would exist, under any
Contract which would, in the aggregate, have a material adverse effect on
Mortgagor or the Property;
(t) No Contract provides any party with the right to
obtain a lien or encumbrance upon the Property superior to the lien of this
Mortgage; and
(u) Mortgagor is not a "foreign person" within the
meaning of ss. 1445(f)(3) of the Internal Revenue Code of 1986, as amended, and
the related Treasury Department Regulations, including temporary regulations;
and
(v) The Mortgagor further represents that no default
or event of default has occurred and is continuing under any Prior Mortgage and
that no event has occurred that with notice or passage of time or both would
constitute such a default or event of default.
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
subjects, 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 approved by Mortgagee, the prosecution or defense of
litigation, and the compromise or discharge of claims made against said
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title or interest. Notwithstanding the foregoing, in the event that Mortgagee
determines that Mortgagor is not adequately performing its obligations under
this Section, 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; any and all reasonable costs and
expenses 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.
1.3 Performance of Obligations. Mortgagor shall pay when due
the principal of and the interest on the indebtedness evidenced by the Note.
Mortgagor shall also pay 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, covenants and agreements to be observed, performed
or discharged by Mortgagor set forth in the Loan Documents in accordance with
their terms. Further, Mortgagor shall promptly and strictly perform and comply
with all covenants, conditions, obligations and prohibitions required of
Mortgagor in connection with any other document or instrument affecting title
to the Property, or any part thereof, regardless of whether which document or
instrument is superior or subordinate to this Mortgage.
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) Insurance against loss or damage to the Property
by fire, windstorm, tornado and hail and against loss and damage by such other,
further and additional risks as may be now or hereafter embraced by an
"all-risk" form of insurance policy. The amount of such insurance shall be not
less than one hundred percent (100%) of the full replacement (insurable) cost
of the Improvements, furniture, furnishings, fixtures, equipment and other
items (whether personalty or 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 indices, 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, in each case, with inflation guard
coverage to reflect the effect of inflation, or annual valuation. Each policy
or policies shall contain a replacement cost endorsement and either an agreed
amount endorsement (to avoid the operation of any
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co-insurance provisions) or a waiver of any co-insurance provisions, all subject
to Mortgagee's approval.
(b) Comprehensive Commercial General Liability
Insurance for personal injury, bodily injury death and property damage
liability in amounts not less than $1,000,000.00 per occurrence and
$5,000,000.00 in the aggregate (both inclusive of umbrella coverage) and Fire
Damage Legal Liability of not less than $100,000. During any construction on
the Property, Mortgagor's general contractor for such construction shall also
provide the insurance required in this Subsection (b). 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) General boiler and machinery insurance coverage
is required if steam boilers or other pressure-fired vessels are in operation
at the Property. Minimum liability amount per accident must equal the greater
of the replacement (insurable) value of the Improvements housing such boiler or
pressure-fired machinery or $1,000,000.00.
(d) If the Property 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 the lesser of: (i) the minimum amount
required, under the terms of coverage, to compensate for any damage or loss on
a replacement basis (or the unpaid balance of the indebtedness secured hereby
if replacement cost coverage is not available for the type of building
insured); or (ii) the maximum insurance available under the appropriate
National Flood Insurance Administration program.
(e) During the period of any construction on the
Property 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) Loss of rents or loss of business income
insurance in amounts sufficient to compensate Mortgagor for all Rents and
Profits during a period of not less than eighteen (18) months in which the
Property may be damaged or destroyed. The amount of coverage shall be adjusted
annually to reflect the Rents and Profits or income payable during the
succeeding eighteen (18) month period.
(g) 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
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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.
(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 including, without limitation, Sinkhole, Mine Subsidence,
Earthquake and Environmental insurance, due regard being given to the height
and type of buildings, their construction, location, use and occupancy.
(i) Statutory limits for worker's compensation
insurance and minimum $500,000 for employer's liability insurance for all
employees of Mortgagor engaged on or with respect to the Subject Premises. If
Mortgagor engages independent contractors, then Mortgagor shall be solely
responsible for verifying and maintaining any appropriate insurance as required
by law or contract for the independent contract.
All such insurance shall (i) be with insurers authorized to
do business in the state within which the Property is located and who have and
maintain a rating of at least "A" from AM Best, (ii) contain the complete
address of the Property (or a complete legal description), (iii) be for terms
of at least one year, (iv) contain deductibles which do not exceed $10,000.00
or, with respect to the policy described in clause (d) above $3,000, 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.
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 of the applicable
insurance companies 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 the insurance
policies, Mortgagor further agrees that all such policies shall include a
standard, non-contributory, mortgagee clause naming:
101 Realty Associates, L.L.C.
its successors and assigns as their
Interests may appear
(x) as an additional insured under all liability insurance policies, (y) as a
mortgagee on all property insurance policies and (z) as the loss payee on all
loss of rents or loss of business income insurance policies. Mortgagor further
agrees that all such insurance policies: (1) shall provide for at least thirty
(30) days' prior written notice to Mortgagee prior to any cancellation or
termination thereof and prior to any
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modification thereof which affects the interest of Mortgagee; (2) 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; (3) shall waive all rights of subrogation against Mortgagee; (4) in
the event that the Real Estate or the Improvements constitutes a legal
non-conforming use under applicable building, zoning or land use laws or
ordinances, shall include an ordinance or law coverage endorsement which will
contain Coverage A: "Loss Due to Operation of Law" (with a minimum liability
limit equal to Replacement Cost With Agreed Value Endorsement), Coverage B:
"Demolition Cost" and Coverage C: "Increased Cost of Construction" coverages;
and (5) may be in the form of a blanket policy provided that, in the event that
any such coverage is provided in the form of a blanket policy, Mortgagor hereby
acknowledges and agrees that failure to pay any portion of the premium therefor
which is not allocable to the Property or by any other action not relating to
the Property which would otherwise permit the issuer thereof to cancel the
coverage thereof, would require the Property to be insured by a separate,
single-property policy. The blanket policy must properly identify and fully
protect the Property as if a separate policy were issued for 100% of
Replacement Cost at the time of loss and otherwise meet all of Mortgagee's
applicable insurance requirements set forth in this Section 1.4. 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 relating to the Property 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 therefor, together with
interest thereon at the Default Interest Rate 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 secured hereby.
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 furnish such insurance. Mortgagor shall not obtain
insurance for the Property in addition to that required by Mortgagee without
the prior written consent of Mortgagee, which consent will not be unreasonably
withheld provided that (i) Mortgagee is a named insured on such insurance, (ii)
Mortgagee receives complete copies of all policies evidencing such instance,
and (iii) such insurance complies with all of the applicable requirements set
forth herein.
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1.5 Payment of Taxes. Mortgagor shall pay or cause to be
paid, except to the extent provision is actually made therefor pursuant to
Section 1.6 or Section 1.7 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. 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 therefor. 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 reasonable discretion, that such contest
suspends the obligation to pay the tax 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 an amount 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 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, 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. At Mortgagee's option
during the continuation of an Event of Default, 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 and as additional security for
the indebtedness secured hereby. After notice from Mortgagee that Mortgagee is
exercising its option hereunder, Mortgagor shall pay to Mortgagee, concurrently
with and in addition to the monthly payment due under the Note and until the
Note and all other indebtedness secured hereby is fully paid and performed,
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 event occurs, and no state of facts exists, which, with the
giving of notice and/or the passage of time, would constitute an Event of
Default (as fined in Section 2.1 hereunder) (such event or state of facts, a
"Default") 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
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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 has occurred and is continuing, Mortgagee shall pay the governmental
authority or other party entitled thereto directly to the extent finds 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 of 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. The Impound Account shall 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. Interest on the funds contained in the Impound
Account shall be paid by Mortgagee to Mortgagor. Upon assignment of this
Mortgage by Mortgagee, any funds in the Impound Account shall be turned over to
the assignee and any responsibility of Mortgagee, as assignor, with respect
thereto shall terminate. 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 refunded to Mortgagor at Mortgagor's option.
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 (10) days after receipt of written notice thereof, deposit with
Mortgagee the full amount of any such deficiency. If the Mortgagor shall fail
to deposit with Mortgagee the full amount of such deficiency as provided above,
Mortgagee shall have the option, but not the obligation, to make such deposit
and all amounts so deposited by Mortgagee, 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. Upon an Event of
Default, Mortgagee may, but shall not be obligated to, apply at any time the
balance then remaining in the Impound Account against the indebtedness secured
hereby in whatever order Mortgagee shall subjectively determine. No such
application of the Impound Account shall be deemed to cure any Default of Event
of Default hereunder, and any such application shall not limit Mortgagor's
obligation to deposit any deficiency of which Mortgagee gives notice. Upon full
payment of the indebtedness secured hereby in accordance with its terms or at
such earlier time as Mortgagee may elect, the balance of the Impound Account
then in Mortgagee's possession shall be paid over to Mortgagor and no other
party shall have any right or claim thereto.
1.7 Intentionally Omitted.
1.8 Intentionally Omitted.
1.9 Casualty and Condemnation. Mortgagor shall give
Mortgagee prompt written notice of the occurrence of any casualty affecting, or
the institution of
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any proceedings for eminent domain or for the condemnation of, the Property or
any portion thereof. 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 time 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)
$250,000.00. 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
limited to, legal fees and disbursements) incurred in obtaining those sums, and
then as follows:
(a) In the event that less than sixty percent (60%)
of the Improvements located on the Real Estate have been taken or destroyed,
then if:
(1) no Default or Event of Default is then
continuing hereunder, and
(2) the Property can, in Mortgagee's
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 within
the earlier to occur of (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
(3) all necessary governmental approvals
can be obtained to allow the rebuilding and reoccupancy of the
Property as described in Section 1.9(a)(2) above, and
(4) there are sufficient sums available
(through insurance proceeds or condemnation awards and contributions
by Mortgagor, the full amount of which shall at Mortgagee's option
have been deposited with Mortgagee) for such restoration or repair
(including, without limitation, for any costs and expenses of
Mortgagee to be 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
(5) the economic feasibility of the
Improvements after such restoration or repair (and including the
impact of the termination of any Leases due to such casualty or
condemnation) will be such that income from
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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 secured
hereby, and
(6) Mortgagor shall have delivered to
Mortgagee, at Mortgagor's sole cost and expense, an appraisal report
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 by Mortgagee in
its determination to make the loan secured hereby, and
(7) Mortgagor so elects by written notice
delivered to Mortgagee within five (5) days after settlement of the
aforesaid insurance or condemnation claim.
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 for 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 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 satisfactory to Mortgagee in its
discretion, with any remainder being applied by Mortgagee for payment of the
indebtedness secured hereby in whatever order Mortgagee directs in its absolute
discretion.
(b) In all other cases, namely, in the event that
sixty percent (60%) or more of the Improvements located on the Real Estate have
been taken or destroyed or Mortgagor does not elect to restore or repair the
Property pursuant to clause (a) above, or otherwise fails to meet the
requirements of clause (a) above, then in any of such events, Mortgagee shall
elect, in Mortgagee's absolute discretion and without regard to the adequacy of
Mortgagee's security, to do either of the following: (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 indebtedness secured hereby in
whatever order Mortgagee directs in its absolute discretion, with any remainder
being paid to Mortgagor, or (2) notwithstanding that Mortgagor may have elected
not to restore or repair the Property pursuant to the provisions of Section
1.9(a)(7) above, require Mortgagor to restore or repair the Property 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 deposit by
Mortgagor with Mortgagee, within thirty (30) days after demand therefor, of any
deficiency necessary in order to assure the availability of sufficient funds to
pay for such restoration or repair, including Mortgagee's costs and expenses to
be incurred in connection therewith, the prior
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approval by Mortgagee of plans and specifications, contractors and form of
construction contracts and the furnishing to Mortgagee of permits, bonds, lien
waivers, invoices, receipt and affidavits from contractors and subcontractors
in form and substance satisfactory to Mortgagee in its discretion, and apply
the remainder of such sums toward such restoration and repair, with any balance
thereafter remaining being applied by Mortgagee for payment of the indebtedness
secured hereby in whatever order Mortgagee directs in its absolute discretion.
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 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
first to the final payment due under the Note and thereafter to installments
due under the Note in the inverse order of their due date. If Mortgagor elects,
or Mortgagee directs Mortgagor, 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 the 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. Mortgagee is hereby irrevocably constituted and
appointed 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 party or authorities making the same, to appear in
and prosecute any proceedings therefore and to give receipts and acquitances
therefor.
1.10 Mechanics' Liens. Mortgagor shall pay when due all
claims and demands of mechanics, materialmen, laborers and others for any work
performed or materials delivered for the Real Estate or 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 Mortgagor, 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
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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
unsuccessful. If Mortgagor shall fail to immediately discharge or provide
security 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 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. The occurrence and
during the continuation of an Event of Default.
1.11 Rents and Profits. As additional and collateral security
for the payment of the indebtedness secured hereby and cumulative of any and
all rights and remedies herein provided for, Mortgagor hereby absolutely and
presently assigns to Mortgagee all existing and future Leases, and all existing
and future Rents and Profits upon the occurrence and during the continuation of
an Event of Default. Mortgagor hereby grants to Mortgagee the sole, exclusive
and immediate right, without taking possession of the Property, to demand,
collect (by suit or otherwise), receive and give valid and sufficient receipts
for any and all of said Rents and Profits, for which purpose Mortgagor does
hereby irrevocably make, constitute and appoint Mortgagee 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 indebtedness
secured hereby is outstanding, shall be deemed to be 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.) Mortgagee shall be without liability for any
loss which may arise from a failure or inability to collect Rents and Profits,
proceeds or other payments. However, until the occurrence of an Event of
Default under this Mortgage, Mortgagor shall have a license to collect and
receive the Rents and Profits when due and prepayments thereof for not more
than one month prior to due date thereof. Upon the occurrence of an Event of
Default, Mortgagor's license shall automatically terminate without notice to
Mortgagor and Mortgagee may thereafter, without taking possession of the
Property, collect the Rents and Profits itself or by an agent or receiver. From
and after the termination of such license, Mortgagor shall be the agent of
Mortgagee in collection of the Rents and Profits and all of the Rents and
Profits so collected by Mortgagor shall be held in trust by Mortgagor for the
sole and exclusive benefit of Mortgagee and Mortgagor shall, within one (1)
business day after receipt of any Rents and Profits, pay the same to Mortgagee
to be applied by Mortgagee as hereinafter set forth. Neither the demand for or
collection of Rents and Profits by Mortgagee, nor the exercise of Mortgagee's
rights as assignee of the Leases, shall constitute any assumption by Mortgagee
of any obligations under any Lease or other agreement relating thereto.
Mortgagee is obligated to account only for such Rents and Profits as are
actually collected or received by Mortgagee. Mortgagor irrevocably agrees and
consents that the respective payors of the Rents and Profits shall, upon demand
and notice from Mortgagee of an Event of Default hereunder, pay said Rents and
Profits to Mortgagee without liability to determine the actual existence of any
Event of Default claimed by Mortgagee.
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Mortgagor hereby waives any right, claim or demand which Mortgagor may now or
hereafter have against any such payor by reason of such payment of Rents and
Profits to Mortgagee, and any such payment shall discharge such payor's
obligation to make such payment to Mortgagor. All Rents and Profits collected
or received by Mortgagee shall be applied against all expenses of collection,
including, without limitation, attorneys' fees, against costs of operation and
management of the Property and against the indebtedness secured hereby, in
whatever order or priority as to any of the items so mentioned as Mortgagee
directs in its sole subjective discretion and without regard to the adequacy of
its security. Neither the exercise by Mortgagee of any rights under this
Section nor the application of any Rents and Profits to the secured
indebtedness shall cure or be deemed a waiver of any Default or Event of
Default hereunder. The assignment of Leases and of Rents and Profits
hereinabove granted shall continue in full force and effect during any period
of foreclosure or redemption with respect to the Property.
1.12 Leases.
(a) Lease Requirements. Each Lease executed after
the date hereof affecting any of the Real Estate or the Improvements must
provide, in a manner approved by Mortgagee, that (i) such Lease is subject and
subordinate to this Mortgage, and (ii) the tenant, lessee or licensee, as
appropriate, will attorn to, and recognize as its landlord, lessor or licensor,
any person succeeding to the interest of Mortgagor in such Lease upon any
foreclosure of this Mortgage or deed in lieu of foreclosure. Each such Lease
shall also provide that, upon request of said successor-in-interest, the
tenant, lessee or licensee shall execute and deliver an instrument or
instruments confirming its attornment as provided for in this Section;
provided, however, that neither Mortgagee nor any successor-in-interest shall
be bound by any payment of rental for more than one (1) month in advance, or
any amendment or modification of said Lease made without the express written
consent of Mortgagee or said successor-in-interest. No Lease shall contain any
option to purchase all or any portion of the Property. No Lease shall contain
any right of first refusal to lease or purchase all or any portion of the
Property. No Lease shall contain any right to terminate the term thereof
(except in the event of the destruction of all or substantially all of the
Property).
(b) Acts Requiring Consent of Mortgagee. Mortgagor
shall not, without the prior written consent of Mortgagee, (i) enter into any
Lease of all or any portion of the Property either (Y) for space in excess of
10,000 rentable square feet, or (Z) for a term (including, without limitation,
options exercisable by the lessee thereunder) of greater than five (5) years
(any such lease, a "Major Lease"); (ii) cancel, terminate, abridge or otherwise
modify the terms of any Major Lease, or accept a surrender thereof; (iii)
consent to any assignment of, or subletting of all or any portion of the
premises demised under, any Major Lease unless required by the terms thereof;
(iv) cancel, terminate abridge, release or otherwise modify any guaranty of any
Major Lease or the terms thereof; (v) enter into any Lease not meeting the
requirements of Section 1.12(a) of this Mortgage; or (vi) enter into any Lease
containing material
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adverse variations from the current form lease approved by Mortgagee. The
request for approval or each such proposed Lease shall be made to Mortgagee in
writing. As part of such request, Mortgagor shall furnish to Mortgagee (and any
loan services specified from time to time by Mortgagee): (1) such biographical
and financial information about the proposed tenant as Mortgagee may require in
conjunction with its review, (2) a copy of the proposed Lease, and (3) 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).
(c) Affirmative Covenants Regarding Leases.
Mortgagor shall at all times promptly and faithfully perform, or cause to be
performed, all of the covenants, conditions and agreements contained in all
Leases, now or hereafter existing, on the part of the landlord, lessor or
licensor thereunder to be kept and performed. Mortgagor shall promptly send
copies to Mortgagee of all notices of default which Mortgagor shall send or
receive under any Lease. 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 other parties under each Lease. Mortgagor
shall furnish to Mortgagee, within ten (10) days after a request by Mortgagee
to do so, but in any event by January 1 of each year, a current rent roll
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, 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 (i) a copy of each Lease;
and (ii) an estoppel certificate from the tenant under each Lease (provided
that Mortgagee shall not be required to deliver such certificates more
frequently than twice in any calendar year).
(d) Negative Covenants Regarding Leases. Mortgagor
shall not enter into any Lease (i) without the prior written consent of
Mortgagee where such consent is required pursuant to this Mortgage; (ii) except
on terms consistent with the terms for similar leases in the market area of the
Real Estate, including, without limitation, as to the rental rate, security
deposit, tenant improvement and work letter terms and free rent periods; (iii)
other than with a third-party tenant unrelated to Mortgagor or any Affiliate
(as defined herein) of Mortgagor; or (iv) except for an actual occupancy by the
tenant, lessee or licensee thereunder. Mortgagor shall not do or suffer to have
done any act that might result in a default by the landlord, lessor or licensor
under any Lease or allow the tenant, lessee or licensee thereunder to withhold
payment or rent and shall not further assign any Lease or any Rents and
Profits. Mortgagor shall not, without the prior written consent of Mortgagee:
(1) modify any Lease; (2) terminate or accept the surrender of any Lease; or
(3) waive or release any other party from the performance or observance of any
obligation or condition under any Lease; provided, however, that with respect
to all Leases other than Major Leases, provided no Default exists hereunder,
Mortgagor may do any of the foregoing 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 solicit or accept the prepayment of any rents
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under any Lease for more than one (1) month prior to the due date thereof.
Mortgagor shall not execute any other assignment of the lessor's interest in
the Leases or the Rents and Profits.
(e) Security Deposits. All security deposits of
tenants, whether held in cash or in any other form, shall not be commingled
with any other funds of Mortgagor or any other person and, if cash, shall be
deposited by Mortgagor at such commercial or savings bank or banks, or
otherwise held in compliance with applicable law, as may be reasonably
satisfactory to Mortgagee. Any bond or other instrument which Mortgagor is
permitted to hold in lieu of cash security deposits under any applicable legal
requirements shall be maintained in full force and effect in the full amount of
such deposits unless replaced by cash deposits as hereinabove described; shall
be issued by an institution reasonably satisfactory to Mortgagee; shall, if
permitted pursuant to any applicable legal requirements, name Mortgagee as
payee or mortgagee thereunder or, at Mortgagee's option, be assigned or fully
assignable to Mortgagee; and shall, in all respects, comply with any applicable
legal requirements and otherwise be reasonably satisfactory to Mortgagee.
Mortgagor shall, upon request, provide Mortgagee with evidence reasonably
satisfactory to Mortgagee of Mortgagor's compliance with the foregoing. Upon an
Event of Default under this Mortgage, Mortgagor shall, immediately upon
Mortgagee's request (if permitted by applicable law), deliver to Mortgagee the
security deposits (and any interest previously earned thereon and not disbursed
to the person(s) lawfully entitled to receive same) with respect to all or any
portion of the Property, to be held by Mortgagee subject to the terns of the
Leases.
(f) Rights of Mortgagee Upon Default. Upon an Event
of Default, whether before or after the whole principal sum secured hereby is
declared to by immediately due or whether before or after the institution of
legal proceedings to foreclose this Mortgage, forthwith upon demand of
Mortgagee, Mortgagor shall surrender to Mortgagee and Mortgagee shall be
entitled to take actual possession of the Property or any part thereof
personally, or by its agent or attorneys. In such event, Mortgagee shall have,
and Mortgagor hereby gives and grants to Mortgagee the right, power and
authority to make and enter into Leases for such rents and for such periods of
occupancy and upon conditions and provisions as Mortgagee may deem desirable in
its sole discretion, and Mortgagor expressly acknowledges and agrees that the
term of such Lease may extend beyond the date of any foreclosure sale at the
Property; it being the intention of Mortgagor that in such event Mortgagee
shall be deemed to be and shall be the attorney-in-fact of Mortgagor for the
purpose of making and entering into Leases for the rents and upon the terms,
conditions and provisions deemed desirable to Mortgagee in its sole discretion
and with like effect as if such Leases had been made by Mortgagor as the owner
in fee simple of the Property free and clear of any conditions or limitations
established by this Mortgage. The power and authority hereby given and granted
by Mortgagor to Mortgagee shall be deemed to be coupled with an interest, shall
not be revocable by Mortgagor so long as any indebtedness secured hereby is
outstanding, shall survive the voluntary or involuntary dissolution of
Mortgagor and shall not be affected by any disability or incapacity suffered by
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Mortgagor subsequent to the date hereof. In connection with any action taken by
Mortgagee pursuant to this Section, Mortgagee shall not be liable for any loss
sustained by Mortgagor resulting from any failure to let the Property, or any
part thereof, or from any other act or omission of Mortgagee in managing the
Property, nor shall Mortgagee be obligated to perform or discharge any
obligation, duty or liability under any Lease or under or by reason of this
instrument or the exercise of rights or remedies hereunder. Mortgagor shall,
and does hereby, indemnify Mortgagee for, and hold Mortgagee harmless from, any
and all claims, actions, demands, liabilities, loss or damage which may or
might be incurred by Mortgagee under any such Lease or under this Mortgage or
by the exercise of rights or remedies hereunder and from any and all claims and
demands whatsoever which may be asserted against Mortgagee by reason of any
alleged obligations or undertakings on its part to perform or discharge any of
the terms, covenants or agreements contained in any such Lease other than those
finally determined to have resulted solely from the gross negligence or willful
misconduct of Mortgagee. Should Mortgagee incur any such liability, the amount
thereof, including, without limitation, costs, expenses and 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. Nothing in this Section shall impose on
Mortgagee any duty, obligation or responsibility for the control, care,
management or repair of the Property, or for the carrying out of any of the
terms and conditions of any such Lease, nor shall it operate to make Mortgagee
responsible or liable for any waste committed on the Property by the tenants or
by any other parties or for any dangerous or defective condition of the
Property, or for any negligence in the management, upkeep, repair or control of
the Property. Mortgagor hereby assents to, ratifies and confirms any and all
actions of Mortgagee with respect to the Property taken under this Section. The
foregoing rights are in addition to all other rights and remedies granted to
Mortgagee pursuant to this Mortgage.
(g) Representations to Leases. Mortgagor hereby
represents and warrants as follows:
(i) Mortgagor has delivered a true, correct
and complete schedule (the "Rent Roll") of all Leases affecting the
Property as of the date hereof, which accurately and completely sets
forth in all material respects for each Lease the following: the name
of the Tenant, the Lease expiration date, extension and renewal
provisions, the base rent payable, the security deposit held
thereunder and any other material provisions of such Lease;
(ii) 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. No default exists, or with the passing of time or the giving
of notice or both would exist, under any Lease which would, in the
aggregate, have a material adverse effect on Mortgagor or the
Property;
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(iii) No Tenant under any Lease has, as of
the date hereof, paid rent more than one (1) month in advance, and the
rents under such Leases have not been waived, released, or otherwise
discharged or compromised;
(iv) 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;
(v) Such Tenant under a Lease has entered
into occupancy of the demised premises;
(vi) Mortgagor has delivered to Mortgagee
true, correct and complete copies of all Leases described in the Rent
Roll;
(vii) 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; and
(viii) No Lease provides any party with the
right to obtain a lien or encumbrance upon the Property superior to
the lien of this Mortgage.
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
evidenced by the Note. Accordingly, except as specifically allowed hereinbelow
in this Section and notwithstanding anything to the contrary contained in
Section 4.6 hereof, in the event that the Property or any part thereof or
interest therein shall be sold, conveyed, disposed of, alienated, hypothecated,
leased (except to Tenants under Leases which are approved, or deemed approved,
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 any 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 an Event of Default hereunder
and Mortgagee shall 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. For the purposes of this
Section 1.13(a): (i) in the event either Mortgagor or, if applicable, any of
its general partners or managing members is a corporation or trust, the sale,
conveyance, transfer or disposition of more than 50% of the issued and
outstanding capital stock of Mortgagor or any of its general partners or
managing members or of the beneficial interest of such trust (or the issuance
of new shares of capital stock in Mortgagor or any of its general partners or
managing
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members so that immediately after such issuance the total capital stock then
issued and outstanding is more than 110% of the total immediately prior to such
issuance) shall be deemed to be a transfer of an interest in the Property, and
(ii) in the event Mortgagor or any general partner or managing member of
Mortgagor is a limited or general partnership, a joint venture or a limited
liability company, a change in the ownership interests in any general partner,
any joint venturer or any member, either voluntarily, involuntarily or
otherwise, or the sale, conveyance, transfer, disposition, alienation,
hypothecation or encumbering of all or any portion of the interest of any such
general partner, joint venturer or member in Mortgagor or such general partner
(whether in the form of a beneficial or partnership interest or in the form of
a power of direction, control or management, or otherwise), shall be deemed to
be a transfer of an interest in the Property. Notwithstanding the foregoing,
however, (1) limited partnership and/or non-managing member interests in
Mortgagor or in any general partner or managing member of Mortgagor shall be
freely transferable without the consent of Mortgagee, and (2) any involuntary
transfer caused by the death of Mortgagor or any general partner, shareholder,
joint venturer, or beneficial owner of a trust shall not be a default under
this Mortgage so long as Mortgagor is reconstituted, if required, following
such death and so long as those persons responsible for the management of
Mortgagor and the Property remain unchanged as a result of such death or any
replacement management is approved by Mortgagee, and (3) gifts for estate
planning purposes of any individual's interests in Mortgagor or in any of
Mortgagor's general partners, managing 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
an Event of 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.
1.14 Payment of Utilities, Assessments, Charges, Etc.
Mortgagor shall pay when due all utility charges which are 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 full 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 business hours for the purposes of inspecting the Property
and of examining, copying 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.
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1.16 Waste; Alteration of Improvements. 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. Without the prior written consent of Mortgagee,
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 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 and other approvals
necessary for the operation of the Property in full force and effect. Mortgagor
shall operate the Property as a commercial property, in accordance with its
current usage, 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. Without limiting the foregoing, in no event shall
Mortgagor take any action that would reduce or impair either (a) the number of
parking spaces at the Property, or (b) the access to the Property from adjacent
public roads. 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 co-operative or convert any part of the Real
Estate or the Improvements to a condominium, co-operative 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. 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 person or 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;
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(b) if reasonably requested by Mortgagee quarterly
operating statements for the Property, within forty-five (45) days after the
end of each calendar quarter;
(c) annual financial statements for Mortgagor, each
principal or general partner, if applicable, in Mortgagor, and each indemnitor
and guarantor under any indemnity or guaranty executed in connection with the
loan secured hereby, and, if reasonably requested by Mortgagee, annual balance
sheets for the Property, all within ninety (90) days after the end of each
calendar year; and
(d) such other information with respect to the
Property, Mortgagor, the principals or general partners, if applicable, in
Mortgagor, and each indemnitor and guarantor under any indemnity or guaranty
executed in connection with the loan secured hereby, which may be requested
from time to time by Mortgagee, within a reasonable time after the applicable
request.
1.19 Further Documentation. (a) Mortgagor shall, on the
request of Mortgagee and at the reasonable expense of Mortgagor: (1) promptly
correct any defect, error or omission which may be discovered in the contents
of this Mortgage or in the contents of any of the other Loan Documents; (2)
promptly execute, acknowledge, deliver and record or file such further
instruments (including, without limitation, further mortgages, deeds of trust,
security deeds, security agreements, financing statements, continuation
statements and assignments of rents or leases) and promptly 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 and to subject to the
liens and security interests hereof and thereof any property intended by the
terms hereof and thereof to be covered hereby and thereby, including
specifically, but without limitation, any renewals, additions, substitutions,
replacements or appurtenances to the Property; (3) promptly execute,
acknowledge, deliver, procure and record or file any document or instrument
(including specifically any financing statement) deemed advisable by Mortgagee
to protect, continue or perfect the liens or the security interests hereunder
against the rights or interests of third persons; and (4) promptly furnish to
Mortgagee, upon Mortgagee's request, a duly acknowledged written statement and
estoppel certificate addressed to such party or parties as directed by
Mortgagee and in form and substance supplied by Mortgagee, setting forth all
amounts due under the Note, stating whether any Default or Event of Default has
occurred and stating whether all grace periods have expired hereunder, and
stating whether any offsets or defenses exist against the indebtedness secured
hereby and containing such other matters as Mortgagee may reasonably require.
(b) Mortgagor will promptly take all actions necessary to
remove or make other arrangements reasonably satisfactory to Mortgagee with
respect to the existing judgment lien of $50,000 in favor of Xxxxxxxx Xxxxxxx
currently in effect against the Property.
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1.20 Payment of Costs: Reimbursement to Mortgagee. Mortgagor
shall pay all reasonable costs and expenses of every character incurred in
connection with the closing of the loan evidenced by the Note and secured
hereby 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 lien/litigation search fees, escrow fees and reasonable attorneys'
fees. If Mortgagor defaults in any such payment, which default is not cured
within any applicable grace or cure period, Mortgagee may pay the same and
Mortgagor shall reimburse Mortgagee on demand for all such costs and expenses
incurred or paid by Mortgagee, together with such interest thereon at the
Default Interest Rate from and after the date of Mortgagee's making such
payment until reimbursement thereof by Mortgagor. Any such sums disbursed by
Mortgagee, together with such interest thereon, shall be additional
indebtedness of Mortgagor secured by this Mortgage and by all of the other Loan
Departments securing all or any part of the indebtedness evidenced by the Note.
Further, Mortgagor shall promptly notify Mortgagee in writing of any litigation
or threatened litigation affecting Mortgagee's interest in the Property, or any
other demand or claim which, if enforced, could impair or threaten to impair
Mortgagee's security hereunder. Without limiting or waiving any other rights
and remedies of Mortgagee hereunder, if Mortgagor fails to perform any of its
covenants or agreements contained in this Mortgage or in any of the other Loan
Documents and such failure is not 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
any sums and take any actions as may be necessary or desirable to protect or
enforce the security of this Mortgagee may, at its option, with or without
notice to Mortgagor, make any appearances, disburse 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 incurred with respect to the
foregoing (including, but not limited to, reasonable fees and disbursements of
counsel), together with interest thereon at the Default Interest Rate 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
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 discretion. Mortgagee is hereby empowered to
enter and to authorize others to enter upon the Property or any 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 shall be exercisable by
Mortgagee, and any and all payments
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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, 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, 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. Mortgagor hereby indemnifies and holds Mortgagee harmless from
and against all loss, cost and expenses with respect to any Event of Default
hereof, any liens (i.e., judgments, mechanics' and materialmen's liens, or
otherwise), charges and encumbrances filed against the Property, and from 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 made or suffered thereon, including, in any case, attorneys' fees,
costs and expenses as aforesaid, whether at pretrial, trial or appellate level,
and such indemnity shall survive payment in full of the indebtedness secured
hereby. This Section 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 sums on deposit with Mortgagee pursuant to
the provisions of Sections 1.6 and 1.7 hereof or any other Section hereof (said
property is hereinafter referred to collectively as the "Collateral"). 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. Mortgagor shall, from time to time upon the request of Mortgagee,
supply Mortgagee with a current inventory of all of the property in which
Mortgagee is granted a security interest hereunder, in such detail as Mortgagee
may require. Mortgagor shall promptly replace all of the Collateral subject to
the lien or security interest of this Mortgage when worn 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 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 under 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. Except with respect to Rents and
Profits to the extent specifically provided herein to the contrary, Mortgagee
shall have the right of possession of all cash, securities, instruments,
negotiable instruments, documents, certificates and any other evidences of cash
or other property or evidences of rights to cash rather than property, which
are now or hereafter a part of the Property and Mortgagor shall promptly
deliver the same to Mortgagee, endorsed to Mortgagee, without further notice
from Mortgagee. Mortgagor agrees to furnish Mortgagee with notice of any change
in the name, identity, organizational structure, residence, or principal place
of business or mailing address of Mortgagor within ten (10) days of the
effective date of any such change. Upon an Event of Default, Mortgagee shall
have the rights and remedies as prescribed in the Mortgage, or as prescribed by
general law, or as prescribed by any applicable Uniform Commercial Code, all at
Mortgagee's election. Any disposition of the Collateral may be conducted by an
employee or agent of Mortgagee. Any person, including both Mortgagor and
Mortgagee, shall be eligible to purchase any part or all of the Collateral at
any such disposition. Expenses of retaking, holding, preparing for sale,
selling or the like (including, without limitation, Mortgagee's 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. Mortgagee shall have the right to enter upon the Real Estate and
the Improvements or any real property where any of the property which is the
subject of the security interest granted herein is located to take possession
of, assemble and collect the same or to render it unusable, or Mortgagor, upon
demand of Mortgages, shall assemble such property and make it available to
Mortgagee at the Real Estate, a place which is hereby deemed to be reasonably
convenient to Mortgagee and Mortgagor. 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 shall be deemed to have been a public sale conducted in a commercially
reasonable manner if held contemporaneously with
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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) In the event of a foreclosure sale, the Property
may, at the option of Mortgagee, be sold as a whole or in parts, as determined
by Mortgagee in its sole discretion; and
(b) It shall not be necessary that Mortgagee take
possession of the aforementioned Collateral, or any part thereof, prior to the
time that any sale pursuant to the provisions of this Section 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.
The name and address of Mortgagor (as Debtor under any
applicable Uniform Commercial Code) are:
USA Detergents, Inc.
0000 Xxxxxx Xxxxxx
Xxxxx Xxxxxxxxx, Xxx Xxxxxx 00000
The name and address of Mortgagee (as Secured Party under any
applicable Uniform Commercial Code) are;
101 Realty Associates, L.L.C.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
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. 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 provided that Mortgagee is paid a standard review fee together
with all other expenses, including, without limitation, attorneys' fees,
incurred by Mortgagee in the review of Mortgagor's request and in the
preparation of documents effecting the subordination.
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1.24 Compliance with Laws. Mortgagor shall at all times
comply with all statutes, ordinances, orders, 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 of 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
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.
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 of
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 Secured Indebtedness. It is understood and agreed that
this Mortgage shall secure payment of not only the indebtedness evidenced by
the Note but also any and all substitutions, replacements, renewals and
extensions of the Note, any and all indebtedness and obligations arising
pursuant to the terms hereof and any and all indebtedness and obligations
arising pursuant to the terms of any of the other Loan Documents, all of which
indebtedness is equally secured with and has the same priority as any amounts
advanced as of the date hereof. It is agreed that any future advances made by
Mortgagee to or for the benefit of Mortgagor from time to time under this
Mortgage or the other Loan Documents and whether or not such advances are
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obligatory or are made at the option of Mortgagee, or otherwise, made for any
purpose, and all interest accruing thereon, shall be equally secured by this
Mortgage and shall have the same priority as all amounts, if any, advanced as
of the date hereof and shall be subject to all of the terms and provisions of
this Mortgage.
1.27 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. 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: (a) waives, releases, relinquishes and forever
foregoes 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 and specifically provided for
herein); (b) waives, releases, relinquishes and forever foregoes all right to a
marshalling 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 liens and security interests may order the Property sold as an
entirety; and (c) waives, releases, relinquishes and forever foregoes all
rights and periods of redemption provided under applicable law. 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 other matters whatever 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
any prior or different resort for collection, or the right of Mortgagee under
the terms of this Mortgage to the payment of the indebtedness secured hereby
out of the proceeds of sale of the Property in preference to every other
claimant whatever. Further, Mortgagor hereby knowingly, intentionally and
voluntarily, with and upon the advice of competent counsel waives, releases
relinquishes and forever foregoes 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. Mortgagor covenants and agrees that upon the
commencement of a voluntary or involuntary bankruptcy proceeding by or against
Mortgager, Mortgagor shall not seek a supplemental stay or otherwise shall not
seek pursuant to 11 U.S.C. ss. 105 or any other provision of the Bankruptcy
Reform Act of 1978, as amended, 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
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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.
1.28 SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL.
(a) MORTGAGOR, TO THE FULL EXTENT PERMITTED BY LAW, HEREBY
KNOWINGLY, INTENTIONALLY AND VOLUNTARILY, WITH AND UPON THE ADVICE OF COMPETENT
COUNSEL, (i) SUBMITS TO PERSONAL JURISDICTION IN THE STATE IN WHICH THE REAL
ESTATE IS LOCATED 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,
(ii) AGREES THAT ANY SUCH ACTION, SUIT OR PROCEEDING MAY BE BROUGHT IN ANY
STATE OR FEDERAL COURT OF COMPETENT JURISDICTION OVER THE COUNTY IN WHICH THE
REAL ESTATE IS LOCATED, (iii) SUBMITS TO THE JURISDICTION OF SUCH COURTS, AND,
(iv) TO THE FULLEST EXTENT PERMITTED BY LAW, 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 FURTHER CONSENTS AND AGREES TO SERVICE OF ANY SUMMONS,
COMPLAINT OR OTHER LEGAL PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING BY
REGISTERED OR CERTIFIED U.S. MAIL, POSTAGE PREPAID, TO THE MORTGAGOR AT THE
ADDRESS FOR NOTICES DESCRIBED IN SECTION 4.5 HEREOF, AND CONSENTS AND AGREES
THAT SUCH SERVICE SHALL CONSTITUTE IN EVERY RESPECT VALID AND EFFECTIVE SERVICE
(BUT NOTHING HEREIN SHALL AFFECT THE VALIDITY OR EFFECTIVENESS OF PROCESS
SERVED IN ANY OTHER MANNER PERMITTED BY LAW).
(b) MORTGAGEE AND MORTGAGOR, TO THE FULL EXTENT PERMITTED BY
LAW, HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY, WITH AND UPON THE ADVICE
OF COMPETENT COUNSEL, WAIVE, RELINQUISH AND FOREVER FOREGO 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, 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.
1.29 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
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shall be pursuant to a written agreement 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.
After an Event of Default hereunder or a default 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 from the Property
shall first be utilized solely for current expenses directly attributable to
the ownership 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. It shall be a condition of Mortgagee's consent to any
management agreement, whether with an affiliate of Mortgagor or a professional
property management company, that such manager enter into an agreement with
Mortgagee whereby the manager acknowledges and agrees to the aforesaid rights
of Mortgagee, and as to such other matters as Mortgagee may require.
1.30 Hazardous Waste and Other Substances.
The terms and provisions of the Hazardous Substances
Indemnity Agreement are incorporated by reference as if fully set forth herein.
1.31 Indemnification; Subrogation.
(a) Mortgagor shall indemnify, defend and hold
Mortgagee harmless against: (i) any and all claims for brokerage, leasing,
finders or similar fees which may be made relating to the Property or the
secured indebtedness, and (ii) any and all liability, obligations, losses,
damages, penalties, claims, actions, suits, costs and expenses (including
Mortgagee's reasonable attorneys' fees, together with reasonable appellate
counsel fees, if any) of whatever kind or nature which may be asserted against,
imposed on or incurred by Mortgagee 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;
provided, however, that nothing herein shall be construed to obligate Mortgagor
to indemnify, defend and hold harmless Mortgagee from and against any and all
liabilities, obligations, losses, 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.
(b) If Mortgagee is made a party defendant to any
litigation or any claim is threatened or brought against Mortgagee concerning
the secured indebtedness, this Mortgage, the Property, or any part thereof, or
any interest therein,
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or the construction, maintenance, operation or occupancy or use thereof, then
Mortgagor shall indemnify, defend and hold Mortgagee harmless from and against
all liability by reason of said litigation or claims, including reasonable
attorneys' fees (together with reasonable appellate counsel fees, if any) and
expenses incurred by Mortgagee in any such litigation or claim, whether or not
any such litigation or claim is prosecuted to judgment. If Mortgagee commences
an action against Mortgagor to enforce any of the terms hereof or to prosecute
any breach by Mortgagor of any of the terms hereof or of any of the other Loan
Documents, or to recover any sum secured hereby, Mortgagor shall pay to
Mortgagee its reasonable attorneys' fees (together with reasonable appellate
counsel fees, if any) and expenses. The right to such reasonable attorneys'
fees (together with reasonable appellate counsel fees, if any) and reasonable
expenses shall be deemed to have accrued on the commencement of such action,
and shall be enforceable whether or not such action is prosecuted to judgment.
If Mortgagor breaches any term of this Mortgage, Mortgagee may engage the
services of an attorney or attorneys to protect its rights hereunder, and in
the event of such engagement following any breach by Mortgagor, Mortgagor shall
pay Mortgagee reasonable attorneys' fees (together with reasonable appellate
counsel fees, if any) and reasonable expenses incurred by Mortgagee, whether or
not an action is actually commenced against Mortgagor by reason of such breach.
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 in-house 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.
ARTICLE II
EVENTS OF DEFAULT
2.1 Events of Default. The occurrence of any of the following
shall be an "Event of Default" hereunder:
(a) Mortgagor fails to punctually perform any
covenant, agreement, obligation, term or condition of the Note, this Mortgage
or any other Loan Document which requires payment of any money to Mortgagee,
and such failure continues for the applicable period set forth therein or, if
no period is set forth, for ten (10) days after such payment becomes due or, if
due on demand, is demanded (except those regarding payments to be made under
the Note, which failure is subject to any grace periods set forth in the Note).
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(b) 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 1.5 or 1.16 hereof.
(c) 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 sixty (60) days.
(d) 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 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.
(e) 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, if applicable, its general partners, or any portion
thereof or any interest therein, in violation of Section 1.13 hereof.
(f) A default occurs under any of the other Loan
Documents which has not been cured within any applicable grace or cure period
therein provided.
(g) Mortgagor, any principal or general partner in
Mortgagor, if applicable, or any indemnitor or guarantor under any indemnity or
guaranty 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 or
general partner of Mortgagor or for any such indemnitor or guarantor or for a
substantial part of the assets of Mortgagor, of any such principal or general
partner 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,
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dissolution or liquidation law or statute of any jurisdiction, whether now or
hereafter in effect.
(h) A petition is filed or any case, proceeding or
other action is commenced against Mortgagor, against any principal or general
partner of Mortgagor, if applicable, 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 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 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 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 or general partner 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.
(i) The Property or any part thereof shall be taken
on execution or other process of law in any action against Mortgagor.
(j) Mortgagor abandons all or a portion of the
Property.
(k) 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, including without limitation the Prior Mortgage,
as that term is defined in Section 4.30 hereof or any of the other Loan
Documents, 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.
(l) 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.
(m) Any dissolution, termination, partial or
complete liquidation, merger or consolidation of Mortgagor.
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(n) Any Event of Default occurs under any of the
other Loan Documents.
(o) Mortgagor defaults under any Major Lease, and
such default continues beyond any applicable notice and/or cure period under
such Major Lease.
ARTICLE III
REMEDIES
3.1 Remedies Available. If there shall occur an Event of
Default under this Mortgage, 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 on the Property. Either in person or by
agent, 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, 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 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, 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 or otherwise collect the Rents and
Profits, including those past due and unpaid.
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(d) Appointment of Receiver. Upon, or at any time
prior to 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 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 hereof.
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, maintain. 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 lieu 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.
(1) In the event foreclosure proceedings are filed
by Mortgagee, all expenses incident to such proceeding, 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 (as defined in the Note), 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), 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.
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(2) Mortgagee may, by following the
procedures and satisfying the requirements prescribed by applicable
law, foreclose on only a portion of the Property and, in such event,
said foreclosure shall not affect the lien of this Mortgage on the
remaining portion of the Property foreclosed.
(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 under the
other Loan Documents, including, but not limited to, receivers' fees, court
costs, attorneys', accountants', appraisers', 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.
(c) To payment of the secured indebtedness and all
other obligations secured by this Mortgage, including, without limitation,
interest at the Default Interest Rate 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.
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 an Event of Default
hereunder, 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, which shall include Mortgagee's right to enforce all contracts
affecting the Property;
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(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, 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; (n) xxx for unpaid Rents and Profits,
payments, income or proceeds 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 Tenant,
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 or other
agreement to Mortgagee without proof of the Event of Default relied upon. Any
such Tenant, 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 or other agreement, or for the performance of any undertakings
under any such Lease, contract or other agreement, and shall have no right or
duty to inquire whether any Event of Default under this Mortgage, or any
default 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
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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 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
foreclosure sale hereunder and at the time of such sale, 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 an Event of Default hereunder, notify the account debtors and obligors of
any accounts, chattel paper, negotiable instruments or other 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 Event of 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 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
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not completed, including, but not limited to, 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, 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. If all of the secured indebtedness
be paid, then and in that event only, all rights under this Mortgage shall
terminate 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 by Mortgagee.
4.3 Certain Right of 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 therein; or (g) join in
any extension agreement of the Mortgage or any agreement subordinating the lien
hereof.
4.4 Waiver of Certain Defenses. No action for the enforcement
of the lien hereof or of any provision hereof shall be subject to any defense
which would not be good and available to the party interposing the same in an
action at law upon the Note or any of the other Loan Documents.
4.5 Notices. All notices, demands, requests or other
communications to be sent by one party to the other hereunder or required by
law shall be in writing and shall be deemed to have been validly given or
served by delivery of the same in person to the intended addressee, or by
depositing the same with Federal Express or another reputable private courier
service for next business day delivery, or by depositing the same in the United
States mail, postage prepaid, registered or certified mail, return receipt
requested in any event addressed to the intended addressee at its address set
forth on the first page of this Mortgage or at such other address as may be
designated by such party as herein provided. All notices, demands and requests
shall be effective upon such personal delivery, or one (1) business day after
being deposited
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with the private courier service, or two (2) business days after being
deposited in the United States mail as required above. Rejection or other
refusal to accept or the inability to deliver because of changed address of
which no notice was given as herein required shall be deemed to be receipt of
the notice, demand or request sent. By giving to the other party hereto at
least fifteen (15) days' prior written notice thereof in accordance with the
provisions hereof, the parties hereto shall have the right from time to time to
change their respective addresses and each shall have the right to specify as
its address any other address within the United States of America.
4.6 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 of Mortgagor in and to all or any part of the Property, and shall
inure to the benefit of Mortgagee, its directors, officers, shareholders,
employees and agents and their respective successors and assigns and shall
constitute covenants running with the land. All references in this Mortgage to
Mortgagor or Mortgagee shall be deemed to include all such parties' successors
and assigns, and the term "Mortgagee" as used herein shall also mean and refer
to any lawful holder or owner, including pledgees and participants, of any of
the indebtedness secured hereby. If Mortgagor consists of more than one person
or entity, each will be jointly and severally liable to perform the obligations
of Mortgagor.
4.7 Severability. A determination that any provision of this
Mortgage is unenforceable or invalid shall not affect the enforceability or
validity of any other provision, and any determination that the application of
any provision of this Mortgage to any person or circumstance is illegal or
unenforceable shall not affect the enforceability or validity of such provision
as it may apply to any other persons or circumstances.
4.8 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.
4.9 Waiver; Discontinuance of Proceedings. Mortgagee may
waive any single Event of Default by Mortgagor hereunder without waiving any
other prior or subsequent Event of Default. Mortgagee may remedy any Event of
Default by Mortgagor hereunder without waiving the Event of Default remedied.
Neither the failure by Mortgagee to exercise, nor the delay by Mortgagee in
exercising, any right, power or remedy upon any Event of Default by Mortgagor
hereunder shall be construed as a waiver of such Event of 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 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 bc effective only in the
specific instance and for the
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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 or an Event of Default hereunder. In case Mortgagee
shall have proceeded to invoke any right, remedy or recourse permitted
hereunder or under the other Loan Documents and shall thereafter elect to
discontinue or abandon the same for any reason, Mortgagee shall have the
unqualified right to do so and, in such an event, Mortgagor and Mortgagee shall
be restored to their former positions with respect to the indebtedness secured
hereby, the Loan Documents, the Property and otherwise, and the rights,
remedies, resources and powers of Mortgagee shall continue as if the same had
never been invoked.
4.10 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.
4.11 Governing Law. This Mortgage will be governed by and
construed in accordance with the laws of the State in which the Real Estate is
located, provided that to the extent 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.
4.12 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 term
"business day" when used herein shall mean a weekday, Monday through Friday,
except a legal holiday or a day on which banking institutions in the State in
which the Real Estate is located are authorized by law to be closed.
4.13 Relationship of the Parties. The relationship between
Mortgagor and Mortgagee is that of a borrower and a lender only and, in the
context of this Mortgage and the Property and Loan Documents, neither of those
parties is, nor shall it hold itself out to be, the agent, employee, joint
venturer or partner of the other party.
4.14 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, charge 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.
4.15 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
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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.
4.16 Cross Default. An Event of Default shall be a default
under each of the other Loan Documents.
4.17 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 sum for which the 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.
4.18 Inconsistency with Other Loan Documents. In the event of
any inconsistency between the provisions hereof and the provisions in any of
the other Loan Documents, it is intended that the provisions selected by
Mortgagee in its sole subjective discretion shall be controlling.
4.19 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.
4.20 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. It is hereby understood and agreed that should Mortgagee
acquire any additional or other interests in or to the Property or the
ownership thereof, then, unless a contrary intent is manifested by Mortgagee as
evidenced by an appropriate document duly recorded, this Mortgage and the lien
hereof shall not merge in such other or additional interests in or to the
Property, toward the end that this Mortgage may be foreclosed as if owned by a
stranger to said other or additional interests.
4.21 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 closing its priority
over the rights of any such junior lien.
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4.22 Mortgagee May File Proofs of Claim. In the case of any
receivership, insolvency, bankruptcy, reorganization, arrangement, adjustment,
composition or other proceedings affecting Mortgagor or, if applicable, the
principals or general partners or members 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.
4.23 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.
4.24 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
mortgage, conveyance or assignment become subject to the lien and security
interest created by this Mortgage. Nevertheless, Mortgagor shall execute,
acknowledge, deliver and record or file, as appropriate, all and every such
further mortgages, security agreements, financing statements, assignments and
assurances, as Mortgagee shall require for accomplishing the purposes of this
Mortgage.
4.25 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
certificates 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.
4.26 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. Any signature page of this Mortgage may be
detached from any counterpart of this Mortgage without impairing the legal
effect of any signatures thereon and may be attached to another counterpart of
this Mortgage identical in form hereto but having attached to it one or more
additional signature pages.
4.27 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
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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.
4.28 Entire Agreement and Modification. This Mortgage and the
other Loan Documents contain the entire agreements between the parties relating
to the subject matter hereof and thereof and all prior agreements relative
hereto and thereto which are not contained herein or therein are terminated.
This Mortgage and the other Loan Documents 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. Any alleged
amendment, revision, waiver, discharge, release or termination which is not so
documented shall not be effective as to any party.
4.29 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 deemed to be Interest) paid or agreed to be
paid to Mortgagee shall, to the extent permitted by applicable law, be
amortized, prorated, allocated and spread throughout the full period until
payment in full of the principal balance of the Note so that the Interest
thereon for such full period will not exceed the maximum amount permitted by
applicable law. This paragraph will control all agreements between Mortgagor
and Mortgagee.
4.30 Second Mortgage.
1. Certain Definitions:
(a) "Prior Mortgage" means the mortgage or
mortgages of all or part of the Property to which
this Mortgage is subordinate as set forth in the
title policy insuring the lien of this Mortgage,
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together with the note or notes secured thereby and
all other documents securing said note or notes.
(b) "Prior Mortgagee" means the holder or
holders of the Prior Mortgage.
2. With respect to the Prior Mortgage, the following
terms, covenants, conditions, representations and warranties shall apply:
(1) the Mortgagor hereby warrants and represents as
follows: (i) all interest payments, principal payments and
other payments and charges required thereby have been paid to
the extent they are payable to the date hereof; (ii) the
Mortgagor is not in default under any of the terms or
provisions of the Prior Mortgage required to be observed or
performed; (iii) no term, covenant or provisions of the Prior
Mortgage prohibits or imposes a limitation upon the grant and
demise of this Mortgage; and (iv) the Mortgagor has, prior to
its execution hereof, delivered to the Mortgagee true and
correct duplicate original copies of the Prior Mortgage and
of any and all amendments and modifications thereof.
(2) The Mortgagor covenants and agrees as follows:
(i) to promptly pay when due, all payments, additional
payments and other sums or charges required to be paid by the
Mortgagor under the Prior Mortgage; (ii) to perform and
observe all covenants and conditions to be performed and/or
observed by the Mortgagor under the Prior Mortgage and shall
immediately deliver to Mortgagee photocopies of all notices
received by Mortgagor from any holder of a Prior Mortgage
within three (3) days after receipt thereof by Mortgagor;
(iii) not to do, permit, suffer or refrain from doing
anything as a result of which, there could be a default under
or breach of any of the terms of the Prior Mortgage; and (iv)
not to modify, amend or in any way alter or permit the
alteration of any of the terms of the Prior Mortgage without
the prior written consent of the Mortgagee, nor to surrender
the property demised thereunder; (v) not to waive, excuse or
discharge any of the obligations and agreements of the Prior
Mortgagee; (vi) to do all things necessary to preserve
unimpaired all of Mortgagor's rights under the Prior
Mortgage; (vii) to furnish to the Mortgagee such information
and evidence as the Mortgagee may reasonably require
concerning the Mortgagor's due observance, performance and
compliance with the terms, covenants and provisions of the
Prior Mortgage.
(3) In the event of any default beyond the
applicable grace period set forth in the Prior Mortgage by
the Mortgagor in the performance of any of its obligations
under the Prior Mortgage, including, without limitation, any
default in the terms of repayment thereunder
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including but not limited to charges and impositions made
payable by the Prior Mortgagee thereunder, then, in each and
every case, the Mortgagee may, at its option and without
notice, cause the default or defaults to be remedied and
otherwise exercise any and all of the rights of the Mortgagor
thereunder in the name of and on behalf of the Mortgagor. The
Mortgagor shall, on demand, reimburse the Mortgagee for all
advances made and expenses incurred by the Mortgagee in
curing any such default (including, without limitation,
reasonable attorney's fees), together with interest thereon
computed at the Default Interest Rate as that term is defined
in the Note dated the date hereof made by Mortgagor to
Mortgagee in the original principal amount of $4,000,000 (the
"Note") from the date that an advance is made or expense is
incurred to and including the date the same is paid.
(4) The Mortgagor shall use its best efforts to
obtain and deliver to the Mortgagee within thirty (30) days
after request by the Mortgagee, an estoppel certificate from
the Prior Mortgagee under the Prior Mortgage setting forth
(i) the names of the parties thereto, (ii) that the Prior
Mortgage has not been modified or, if it has been modified,
the date of each modification (together with copies of each
such modification certified as true and correct by the Prior
Mortgagee), (iii) the terms of payment under the Prior
Mortgage, (iv) the date to which all payments and charges of
any type required pursuant to the terms thereof have been
paid by the Mortgagor under the Prior Mortgage, and (v)
whether there are any alleged defaults of the Mortgagor under
the Prior Mortgage and, if there are, setting forth the
nature thereof in reasonable detail.
(5) The Mortgagor hereby irrevocably designates the
Mortgagee its agent and attorney-in-fact to perform or
observe on behalf of the Mortgagor any covenant or condition
which the Mortgagor fails to perform or observe under the
Prior Mortgage within any applicable grace period specified
in the Prior Mortgage, including, but not limited to, the
payment of any principal and/or interest payable under the
Prior Mortgage, and any advances made by the Mortgagee in
connection with such performance or observance shall be
repaid by the Mortgagor within ten (10) days of demand with
interest at the Default Interest Rate and the amount so
advanced with interest, shall be a lien upon the Property and
shall be secured by this Mortgage. The performance or
observance of such covenant or condition by the Mortgagee
shall not prevent the Mortgagor's failure so to perform or
observe from constituting an Event of Default. In performing
or observing any such covenant or condition, the Mortgagee
shall have the right to enter upon the Property. Upon receipt
by the Mortgagee from the Mortgagor and/or the holder of the
Prior Mortgage of any notice of default under the Prior
Mortgage, the Mortgagee may rely thereon and take any action
permitted by this Section 4.30 to remedy such default
notwithstanding that the existence of such default or the
nature
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thereof may be questioned or denied by the Mortgagor. Nothing
contained in this Section 4.30 shall be deemed to create any
duty or obligation on the part of the Mortgagee to take any
action with respect to the Prior Mortgage and/or the curing
of any defaults thereunder.
(6) If the Mortgagor or any subsequent owner of the
Property becomes the Prior Mortgagee then notwithstanding
anything to the contrary contained in any document, agreement
or the law, the lien of the Prior Mortgage shall merge with
the fee ownership of the Property and the lien of this
Mortgage shall automatically become a first mortgage lien on
the Property.
(7) To the extent that the rights of the Prior
Mortgagee preclude or preempt the Mortgagee from exercising
any of its rights given Mortgagee under this Mortgage then
the rights of the Prior Mortgagee shall control and to the
extent that the terms of the Prior Mortgage are inconsistent
with the terms of this Mortgage then the Mortgagee
acknowledges that the terms provided for in this Mortgage are
subordinate to the terms of the Prior Mortgage for so long as
the Prior Mortgage remains a lien on the Property prior to
the lien of this Mortgage.
THE MORTGAGOR HEREBY REPRESENTS AND ACKNOWLEDGES
THAT THE MORTGAGOR HAS RECEIVED, WITHOUT CHARGE, A TRUE COPY
OF THIS MORTGAGE.
IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as
of the day and year first above written.
ATTEST: USA DETERGENTS, INC.
By /s/ Xxxxxxx X. Xxxxxx
---------------------
Xxxxxxx X. Xxxxxx
Xx. Vice President
/s/ Uri Evan
--------------------
Uri Evan
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