RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
Xxxxxxxx Xxxxxxxx & Xxxxxx P.C.
Xxxxxxx X. Xxxxxxxx, Esq.
5400 Renaissance Tower
0000 Xxx Xxxxxx
Xxxxxx, Xxxxx 00000
DEED OF TRUST
WITH ABSOLUTE ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FIXTURE FILING
THE PARTIES TO THIS DEED OF TRUST WITH ABSOLUTE ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FIXTURE FILING ("Deed of Trust"), made as of June 3, 2004
(the "Effective Date"), are INTERVOICE, INC., a Texas corporation ("Grantor"),
whose address is 00000 Xxxxxxxxx Xxxxxxx, Xxxxxx, Xxxxx 00000, XXXXXXX X.
XXXXXXXX, ESQ., whose address is 5400 Renaissance Tower, 0000 Xxx Xxxxxx,
Xxxxxx, Xxxxx 00000 ("Trustee"), and XXXXX FARGO BANK, NATIONAL ASSOCIATION
("Beneficiary"), whose address is North Dallas RCBD, 0000 Xxxxxxx Xxxx
Xxxxxxxxx, Xxxxx 000, Xxxxx, Xxxxx 00000.
ARTICLE 1. GRANT IN TRUST
1.1 GRANT. For the purposes of and upon the terms and conditions in this Deed
of Trust and to secure the full and timely payment, performance and
discharge of the Secured Obligations (as herein defined), Grantor
irrevocably GRANTS, CONVEYS, ASSIGNS, BARGAINS and SELLS and has by these
presents GRANTED, CONVEYED, ASSIGNED, BARGAINED and SOLD, to Trustee, in
trust for the benefit of Beneficiary, with power of sale and right of
entry and possession, all of that real property located in the City of
Dallas, County of Collin, State of Texas, described on Exhibit A attached
hereto, together with all right, title interest, and privileges of Grantor
in and to all streets, ways, roads and alleys used in connection with or
pertaining to such real property or the improvements thereon, all
development rights or credits, air rights, water, water rights and water
stock related to the real property, all timber, and all minerals, oil and
gas, and other hydrocarbon substances in, on or under the real property,
and all licenses, appurtenances, reversions, remainders, easements, rights
and rights of way appurtenant or related thereto; all buildings, other
improvements and fixtures now or hereafter located on the real property,
including, but not limited to, all heating and air conditioning equipment
and other equipment included in building systems or necessary for the
operation or occupancy of the real property, it being intended by the
parties that all such items shall be conclusively considered to be a part
of the real property, whether or not attached or affixed to the real
property (the "Improvements"); all interest or estate which Grantor may
hereafter acquire in the property described above, and all additions and
accretions thereto, and the proceeds of any of the foregoing; (all of the
foregoing being collectively referred to as the "Subject Property"); the
listing of specific rights or property shall not be interpreted as a limit
of general terms; TO HAVE AND TO HOLD the Subject Property unto Trustee,
forever, and Grantor does hereby bind itself, its successors and assigns,
to WARRANT AND FOREVER DEFEND the title to the Subject Property unto
Trustee against every person whomsoever lawfully claiming or to claim the
same or any part thereof; provided, however, that if Grantor shall pay (or
cause to be paid) and shall perform and discharge (or cause to be
performed and discharged) the Secured Obligations on or before the date
same are to be paid, performed and discharged, then the liens, security
interests, estates, rights and titles granted by this Deed of Trust shall
terminate in accordance with the provisions hereof, otherwise same shall
remain in full force and effect. A certificate or other written statement
executed on behalf of Trustee or Beneficiary confirming that the Secured
Obligations have not been fully and finally paid, performed or discharged
shall be sufficient evidence thereof for the purpose of reliance by third
parties on such fact.
DEED OF TRUST - Page 1
ARTICLE 2. OBLIGATIONS SECURED
2.1 OBLIGATIONS SECURED. Grantor makes this Deed of Trust for the purpose of
securing the following obligations ("Secured Obligations"):
(a) Payment to Beneficiary of all sums at any time owing under: (i) that
certain Revolving Line of Credit Note, dated January 26, 2004, in
the stated principal amount of Five Million Five Hundred Thousand
and No/100 Dollars ($5,500,000.00) executed by Grantor (the
"Revolving Credit Note"), and (ii) that certain Term Note of even
date herewith in the stated principal amount of Eight Million and
No/100 Dollars ($8,000,000.00) executed by Grantor (the "Term
Note"); and
(b) Payment and performance of all covenants and obligations of Grantor
under this Deed of Trust; and
(c) Payment and performance of all covenants and obligations of Grantor
under that certain Amended and Restated Credit Agreement of even
date herewith by and between Grantor and Beneficiary, as lender (the
"Loan Agreement"); and
(d) Payment and performance of all covenants and obligations of Grantor
pursuant to any other documents executed in connection with the
loans evidenced, governed or secured by the Revolving Credit Note
and the Term Note (collectively, the "Note") or the Loan Agreement
(collectively, the "Loan Documents"), and
(e) Payment and performance of all future advances and other obligations
that Grantor may agree to pay and/or perform (whether as principal,
surety or guarantor) for the benefit of Beneficiary, when such
future advance or obligation is evidenced by a writing signed by
Grantor which recites that it is secured by this Deed of Trust; and
(f) All modifications, extensions and renewals of any of the obligations
secured hereby, however evidenced, including, without limitation:
(i) modifications of the required principal payment dates or
interest payment dates or both, as the case may be, deferring or
accelerating payment dates wholly or partly; or (ii) modifications,
extensions or renewals at a different rate of interest whether or
not in the case of a note, the modification, extension or renewal is
evidenced by a new or additional promissory note or notes.
2.2 OBLIGATIONS. The term "obligations" is used herein in its broadest and
most comprehensive sense and shall be deemed to include, without
limitation, all interest and charges, prepayment charges (if any), late
charges and loan fees at any time accruing or assessed on any of the
Secured Obligations.
2.3 INCORPORATION. All terms of the Secured Obligations and the documents
evidencing such obligations are incorporated herein by this reference. All
persons who may have or acquire an interest in the Subject Property shall
be deemed to have notice of the terms of the Secured Obligations and to
have notice, if provided therein, that: (a) the Note or the Loan Agreement
may permit borrowing, repayment and re-borrowing so that repayments shall
not reduce the amounts of the Secured Obligations; and (b) the rate of
interest on one or more Secured Obligations may vary from time to time.
ARTICLE 3. ASSIGNMENT OF LEASES AND RENTS
3.1 ASSIGNMENT. Grantor hereby irrevocably assigns to Beneficiary all of
Grantor's right, title and interest in, to and under: (a) all leases of
the Subject Property or any portion thereof, and all other agreements of
any kind relating to the use or occupancy of the Subject Property or any
portion thereof, whether now existing or entered into after the date
hereof ("Leases"); and (b) the rents, revenue, income, issues, deposits
and profits of the Subject Property, including, without limitation, all
amounts payable and all rights and benefits accruing to Grantor under the
Leases ("Payments"). The term "Leases" shall also include all guarantees
of and security for
DEED OF TRUST - Page 2
the lessees' performance thereunder, and all amendments, extensions,
renewals or modifications thereto which are permitted hereunder. This is a
present and absolute assignment, not an assignment for security purposes
only, and Beneficiary's right to the Leases and Payments is not contingent
upon, and may be exercised without possession of, the Subject Property.
3.2 GRANT OF LICENSE. Beneficiary confers upon Grantor a license ("License")
to collect and retain the Payments as they become due and payable.
However, at any time when an Event of Default (hereinafter defined) has
occurred and is continuing, the License shall be automatically revoked and
Beneficiary may collect and apply the Payments pursuant to Section 6.4
without notice and without taking possession of the Subject Property.
Grantor hereby irrevocably authorizes and directs the lessees under the
Leases to rely upon and comply with any notice or demand by Beneficiary
for the payment to Beneficiary of any rental or other sums which may at
any time become due under the Leases, or for the performance of any of the
lessees' undertakings under the Leases, and the lessees shall have no
right or duty to inquire as to whether any Event of Default has actually
occurred or is then existing. Grantor hereby relieves the lessees from any
liability to Grantor by reason of relying upon and complying with any such
notice or demand by Beneficiary.
3.3 EFFECT OF ASSIGNMENT. The foregoing irrevocable assignment shall not cause
Beneficiary to be: (a) a mortgagee in possession; (b) responsible or
liable for the control, care, management or repair of the Subject Property
or for performing any of the terms, agreements, undertakings, obligations,
representations, warranties, covenants and conditions of the Leases; or
(c) responsible or liable for any waste committed on the Subject Property
by the lessees under any of the Leases or any other parties; for any
dangerous or defective condition of the Subject Property; or for any
negligence in the management, upkeep, repair or control of the Subject
Property resulting in loss or injury or death to any lessee, licensee,
employee, invitee or other person. Beneficiary and Trustee shall not
directly or indirectly be liable to Grantor or any other person as a
consequence of: (i) the exercise or failure to exercise by Beneficiary or
Trustee, or any of their respective employees, agents, contractors or
subcontractors, any of the rights, remedies or powers granted to
Beneficiary or Trustee hereunder; or (ii) the failure or refusal of
Beneficiary to perform or discharge any obligation, duty or liability of
Grantor arising under the Leases.
3.4 REPRESENTATIONS AND WARRANTIES. Grantor represents that as of the date
hereof, there are no Leases in effect.
3.5 COVENANTS. Grantor covenants and agrees at Grantor's sole cost and expense
to: (a) perform the obligations of lessor contained in any Leases and
enforce by all available remedies performance by the lessees of the
obligations of the lessees contained in the Leases; (b) give Beneficiary
prompt written notice of any default or termination (or notice thereof)
which occurs with respect to any of the Leases, whether the default be
that of the lessee or of the lessor; (c) deliver to Beneficiary fully
executed, counterpart original(s) of each and every Lease if requested to
do so; and (e) execute and record such additional assignments of any Lease
or specific subordinations (or subordination, attornment and
non-disturbance agreements executed by the lessor and lessee) of any Lease
to the Deed of Trust, in form and substance acceptable to Beneficiary, as
Beneficiary may request. Grantor shall not, without Beneficiary's prior
written consent or as otherwise permitted by any provision of the Loan
Agreement: (i) enter into any Leases after the date hereof; (ii) execute
any other assignment relating to any of the Leases; (iii) discount any
rent or other sums due under the Leases or collect the same in advance,
other than to collect rentals one (1) month in advance of the time when it
becomes due; (iv) terminate, modify or amend any of the terms of the
Leases or in any manner release or discharge the lessees from any
obligations thereunder; (v) consent to any assignment or subletting by any
lessee; or (vi) subordinate or agree to subordinate any of the Leases to
any other deed of trust or encumbrance. Any such attempted action in
violation of the provisions of this Section 3.5 shall be null and void.
Without in any way limiting the requirement of Beneficiary's consent
hereunder, any sums received by Grantor in consideration of any
termination (or the release or discharge of any lessee), modification or
amendment of any Lease shall be applied to reduce the outstanding Secured
Obligations and any such sums received by Grantor shall be held in trust
by Grantor for such purpose.
3.6 ESTOPPEL CERTIFICATES. Within thirty (30) days after written request by
Beneficiary, Grantor shall deliver to Beneficiary and to any party
designated by Beneficiary estoppel certificates executed by Grantor and by
each of the lessees, in recordable form, certifying (if such be the case):
(a) that the foregoing assignment
DEED OF TRUST - Page 3
and the Leases are in full force and effect; (b) the date of each lessee's
most recent payment of rent; (c) that there are no defenses or offsets
outstanding, or stating those claimed by Grantor or lessees under the
foregoing assignment or the Leases, as the case may be; and (d) any other
information reasonably requested by Beneficiary.
ARTICLE 4. SECURITY AGREEMENT AND FIXTURE FILING
4.1 SECURITY INTEREST. Grantor hereby grants and assigns to Beneficiary as of
the "Effective Date" a security interest, to secure payment and
performance of all of the Secured Obligations, in all of the following
described personal property in which Grantor now or at any time hereafter
has any interest (collectively, the "Collateral"):
All goods, building and other materials, supplies, work in process,
equipment, machinery, fixtures, furniture, furnishings, signs and
other personal property, wherever situated, which are or are to be
incorporated as fixtures into (i) the real property described on
Exhibit A attached hereto and incorporated by reference herein (to
the extent the same are not effectively made a part of the real
property pursuant to Section 1.1 above) or (ii) the Improvements
(which real property and Improvements are collectively referred to
herein as the Subject Property); together with all rents generated
by the Subject Property (to the extent, if any, they are not subject
to Article III); all insurance policies providing coverage against
damage to the Subject Property or any other Collateral and any
insurance and condemnation awards and proceeds resulting from any
damage to or taking of the Subject Property or other Collateral; all
permits, consents, approvals, licenses, authorizations and other
rights granted by, given by or obtained from, any governmental
entity with respect to the Subject Property; all deposits or other
security now or hereafter made with or given to utility companies by
Grantor with respect to the Subject Property; all advance payments
of insurance premiums made by Grantor with respect to the Subject
Property; all plans, drawings and specifications relating to the
Subject Property; and together with all replacements and proceeds
of, and additions and accessions to, any of the foregoing and all
books, records and files relating to any of the foregoing.
As to all of the above described personal property which is or which
hereafter becomes a "fixture" under applicable law, this Deed of
Trust constitutes a fixture filing under the Uniform Commerce Code
of the state in which the Subject Property is located, as amended or
recodified from time to time (the "UCC").
Neither the "Subject Property" nor the "Collateral" will include patents,
trademarks or other intellectual property of Grantor, it being understood
that Grantor is not granting a lien against or security interest in any
such patents, trademarks or other intellectual property.
4.2 REPRESENTATIONS AND WARRANTIES. Grantor represents and warrants that: (a)
Grantor has, and will have, good title to the Collateral, subject to title
exceptions listed in any title insurance policy provided to Grantor to
insure the lien of this Deed of Trust; (b) Grantor has not previously
assigned or encumbered the Collateral by any other lien or security
interest which will continue beyond the date of this Deed of Trust; and
(c) Grantor's principal place of business is located at the address shown
in Section 4.7.
4.3 RIGHTS OF BENEFICIARY. In addition to Beneficiary's rights as a "Secured
Party" under the UCC, Beneficiary may, but shall not be obligated to, at
any time when an Event of Default has occurred and is continuing, without
notice and at the expense of Grantor: (a) give notice to any person of
Beneficiary's rights hereunder and enforce such rights at law or in
equity; (b) insure, protect, defend and preserve the Collateral or any
rights or interests of Beneficiary therein; (c) inspect the Collateral;
and (d) endorse, collect and receive any right to payment of money owing
to Grantor under or from the Collateral. Notwithstanding the above, in no
event shall Beneficiary be deemed to have accepted any property other than
cash in satisfaction of any obligation of Grantor to Beneficiary unless
Beneficiary shall make an express written election of said remedy under
the UCC, or other applicable law.
DEED OF TRUST - Page 4
4.4 RIGHTS OF BENEFICIARY WHEN AN EVENT OF DEFAULT IS OUTSTANDING. When any
Event of Default has occurred and is continuing, in addition to all of
Beneficiary's rights as a "Secured Party" under the UCC or otherwise at
law:
(a) Beneficiary may (i) upon written notice, require Grantor to assemble
any or all of the Collateral and make it available to Beneficiary at
a place designated by Beneficiary; (ii) without prior notice, enter
upon the Subject Property or other place where any of the Collateral
may be located and take possession of, collect, sell, and dispose of
any or all of the Collateral, and store the same at locations
acceptable to Beneficiary at Grantor's expense; (iii) sell, assign
and deliver at any place or in any lawful manner all or any part of
the Collateral and bid and become the purchaser at any such sales;
and
(b) Beneficiary may, for the account of Grantor and at Grantor's
expense: (i) operate, use, consume, sell or dispose of the
Collateral as Beneficiary deems appropriate for the purpose of
performing any or all of the Secured Obligations; (ii) enter into
any agreement, compromise, or settlement, including insurance
claims, which Beneficiary may deem desirable or proper with respect
to any of the Collateral; and (iii) endorse and deliver evidences of
title for, and receive, enforce and collect by legal action or
otherwise, all indebtedness and obligations now or hereafter owing
to Grantor in connection with or on account of any or all of the
Collateral.
Notwithstanding any other provision hereof, Beneficiary shall not be
deemed to have accepted any property other than cash in satisfaction
of any obligation of Grantor to Beneficiary unless Grantor shall
make an express written election of said remedy under the UCC, or
other applicable law.
4.5 POWER OF ATTORNEY. Grantor hereby irrevocably appoints Beneficiary as
Grantor's attorney-in-fact (such agency being coupled with an interest),
and as such attorney-in-fact Beneficiary may, without the obligation to do
so, in Beneficiary's name, or in the name of Grantor, prepare, execute and
file or record financing statements, continuation statements, applications
for registration and like papers necessary to create, perfect or preserve
any of Beneficiary's security interests and rights in or to any of the
Collateral, and, when any Event of Default has occurred and is continuing,
take any other action required of Grantor; provided, however, that
Beneficiary as such attorney-in-fact shall be accountable only for such
funds as are actually received by Beneficiary.
4.6 POSSESSION AND USE OF COLLATERAL. Except as otherwise provided in this
Section or the other Loan Documents, so long as no Event of Default has
occurred and is continuing, Grantor may possess, use, move, transfer or
dispose of any of the Collateral in the ordinary course of Grantor's
business and in accordance with the Loan Agreement.
4.7 SECURITY AGREEMENT.
(a) The exact legal name and address of debtor is: Intervoice, Inc.,
00000 Xxxxxxxxx Xxxxxxx, Xxxxxx, Xxxxx 00000.
(b) Name and address of secured party: Xxxxx Fargo Bank, National
Association, North Dallas RCBD, 0000 Xxxxxxx Xxxx Xxxxxxxxx, Xxxxx
000, Xxxxx, Xxxxx 00000.
(c) Description of the types (or items) of property covered by this
Financing Statement: all of the property described in Section 4.1.
(d) Description of real estate to which collateral is attached or upon
which it is located: Described in Exhibit A.
(e) Organizational Number of debtor: 0068871100.
DEED OF TRUST - Page 5
(f) Debtor's chief executive office is located in the State of Texas,
and debtor's state of formation is the State of Texas.
ARTICLE 5. RIGHTS AND DUTIES OF THE PARTIES
5.1 TITLE. Grantor represents and warrants that, except as disclosed to
Beneficiary in a writing which refers to this warranty, Grantor lawfully
holds and possesses fee simple title to the Subject Property without
limitation on the right to encumber, and that this Deed of Trust is a
first and prior lien on the Subject Property. Grantor hereby represents
and warrants that all of the Subject Property is a single tax parcel, and
there are no properties included in such tax parcel other than the Subject
Property. Grantor further covenants and agrees that it shall not cause all
or any portion of the Subject Property to be replatted or for any lots or
boundary lines to be adjusted, changed or altered for either ad valorem
tax purposes or otherwise, and shall not consent to the assessment of the
Subject Property in more than one tax parcel or in conjunction with any
property other than the Subject Property.
5.2 TAXES AND ASSESSMENTS. Subject to Grantor's rights to contest payment of
taxes as may be provided in the Loan Agreement, Grantor shall pay prior to
delinquency all taxes, assessments, levies and charges imposed by any
public or quasi-public authority or utility company which are or which may
become a lien upon or cause a loss in value of the Subject Property or any
interest therein. Grantor shall also pay prior to delinquency all taxes,
assessments, levies and charges imposed by any public authority upon
Beneficiary by reason of its interest in any Secured Obligation or in the
Subject Property, or by reason of any payment made to Beneficiary pursuant
to any Secured Obligation; provided, however, Grantor shall have no
obligation to pay taxes which may be imposed from time to time upon
Beneficiary and which are measured by and imposed upon Beneficiary's net
income.
5.3 INTENTIONALLY DELETED.
5.4 PERFORMANCE OF SECURED OBLIGATIONS. Grantor shall promptly pay and
perform each Secured Obligation when due.
5.5 LIENS, ENCUMBRANCES AND CHARGES. Grantor shall immediately discharge any
lien not approved by Beneficiary in writing that has or may attain
priority over this Deed of Trust. Subject to the provisions of the Loan
Agreement regarding mechanics' liens, Grantor shall pay when due all
obligations secured by or which may become liens and encumbrances which
shall now or hereafter encumber or appear to encumber all or any part of
the Subject Property or Collateral or any interest therein, whether senior
or subordinate hereto.
5.6 DAMAGES; INSURANCE AND CONDEMNATION PROCEEDS.
(a) The following (whether now existing or hereafter arising) are all
absolutely and irrevocably assigned by Grantor to Beneficiary and,
at the request of Beneficiary, shall be paid directly to
Beneficiary: (i) all awards of damages and all other compensation
payable directly or indirectly by reason of a condemnation or
proposed condemnation for public or private use affecting all or any
part of, or any interest in, the Subject Property or Collateral;
(ii) all other claims and awards for damages to, or decrease in
value of, all or any part of, or any interest in, the Subject
Property or Collateral; (iii) all proceeds of any insurance policies
payable by reason of loss sustained to all or any part of the
Subject Property or Collateral; and (iv) all interest which may
accrue on any of the foregoing. Subject to applicable law, and
without regard to any requirement contained in Section 5.7(d), but
subject to the next subsection, Beneficiary may at its discretion
apply all or any of the proceeds it receives to its expenses in
settling, prosecuting or defending any claim and may apply the
balance to the Secured Obligations in any order acceptable to
Beneficiary, and/or Beneficiary may release all or any part of the
proceeds to Grantor upon any conditions Beneficiary may impose.
Beneficiary may commence, appear in, defend or prosecute any
assigned claim or action and may adjust, compromise, settle and
collect all claims and awards assigned to Beneficiary; provided,
however, in no event shall Beneficiary be responsible for any
failure to collect any claim or award, regardless of the cause of
the
DEED OF TRUST - Page 6
failure, including, without limitation, any malfeasance or
nonfeasance by Beneficiary or its employees or agents.
(b) At its sole option, Beneficiary may permit insurance or condemnation
proceeds held by Beneficiary to be used for repair or restoration
but may condition such application upon reasonable conditions,
including, without limitation: (i) the deposit with Beneficiary of
such additional funds which Beneficiary reasonably determines are
needed to pay all costs of the repair or restoration, (including,
without limitation, taxes, financing charges, insurance and rent
during the repair period); (ii) the establishment of an arrangement
for lien releases and disbursement of funds acceptable to
Beneficiary (any such arrangement contained in the Loan Agreement
for obtaining lien releases and disbursing loan funds shall be
deemed reasonable with respect to disbursement of insurance or
condemnation proceeds); (iii) the delivery to Beneficiary of plans
and specifications for the work, a contract for the work signed by a
contractor reasonably acceptable to Beneficiary, a cost breakdown
for the work and a payment and performance bond for the work, all of
which shall be reasonably acceptable to Beneficiary; and (iv) the
delivery to Beneficiary of evidence reasonably acceptable to
Beneficiary (aa) that upon completion of the work, the size,
capacity and total value of the Subject Property will be at least as
great as it was before the damage or condemnation occurred; (bb)
that there has been no material adverse change in the financial
condition or credit of Grantor since the date of this Deed of Trust;
and (cc) of the satisfaction of any additional conditions that
Beneficiary may reasonably establish to protect its security.
Grantor hereby acknowledges that the conditions described above are
reasonable, and, if such conditions have not been satisfied within
thirty (30) days of receipt by Beneficiary of such insurance or
condemnation proceeds, then Beneficiary may apply such insurance or
condemnation proceeds to pay the Secured Obligations in such order
and amounts as Beneficiary in its sole discretion may choose.
5.7 MAINTENANCE AND PRESERVATION OF THE SUBJECT PROPERTY. Subject to the
provisions of the Loan Agreement, Grantor covenants: (a) to insure the
Subject Property and Collateral against such risks as Beneficiary may
require and, at Beneficiary's request, to provide evidence of such
insurance to Beneficiary, and to comply with the requirements of any
insurance companies providing such insurance; (b) to keep the Subject
Property and Collateral in good condition and repair; (c) not to remove or
demolish the Subject Property or Collateral or any part thereof, not to
alter, restore or add to the Subject Property or Collateral and not to
initiate or acquiesce in any change in any zoning or other land
classification which affects the Subject Property without Beneficiary's
prior written consent or as provided in the Loan Agreement; (d) to
complete or restore promptly and in good and workmanlike manner the
Subject Property and Collateral, or any part thereof which may be damaged
or destroyed, without regard to whether Beneficiary elects to require that
insurance proceeds be used to reduce the Secured Obligations as provided
in Section 5.6; (e) to comply with all laws, ordinances, regulations and
standards, and all covenants, conditions, restrictions and equitable
servitudes, whether public or private, of every kind and character which
affect the Subject Property or Collateral and pertain to acts committed or
conditions existing thereon, including, without limitation, any work,
alteration, improvement or demolition mandated by such laws, covenants or
requirements; (f) not to commit or permit waste of the Subject Property or
Collateral; and (g) to do all other acts which from the character or use
of the Subject Property or Collateral may be reasonably necessary to
maintain and preserve its value.
5.8 DEFENSE AND NOTICE OF LOSSES, CLAIMS AND ACTIONS. At Grantor's sole
expense, Grantor shall protect, preserve and defend the Subject Property
and Collateral and title to and right of possession of the Subject
Property and Collateral, the security hereof and the rights and powers of
Beneficiary and Trustee hereunder against all adverse claims. Grantor
shall give Beneficiary and Trustee prompt notice in writing of the
assertion of any claim, of the filing of any action or proceeding, of the
occurrence of any damage to the Subject Property or Collateral and of any
condemnation offer or action.
5.9 ACCEPTANCE OF TRUST; POWERS AND DUTIES OF TRUSTEE.
(a) Trustee accepts this trust when this Deed of Trust is delivered by
Grantor to Beneficiary. Except as may be required by applicable law,
Trustee may from time to time apply to any court of competent
jurisdiction for aid and direction in the execution of the trust
hereunder and the enforcement of the
DEED OF TRUST - Page 7
rights and remedies available hereunder, and may obtain orders or
decrees directing or confirming or approving acts in the execution
of said trust and the enforcement of said remedies.
(b) Trustee shall not be required to take any action toward the
execution and enforcement of the trust hereby created or to
institute, appear in, or defend any action, suit, or other
proceeding in connection therewith where, in his opinion, such
action would be likely to involve him in expense or liability,
unless requested so to do by a written instrument signed by
Beneficiary and, if Trustee so requests, unless Trustee is tendered
security and indemnity satisfactory to Trustee against any and all
cost, expense, and liability arising therefrom. Trustee shall not be
responsible for the execution, acknowledgment, or validity of the
Loan Documents, or for the proper authorization thereof, or for the
sufficiency of the lien and security interest purported to be
created hereby, and Trustee makes no representation in respect
thereof or in respect of the rights, remedies, and recourses of
Beneficiary.
(c) With the approval of Beneficiary, Trustee shall have the right to
take any and all of the following actions: (i) to select, employ,
and advise with counsel (who may be, but need not be, counsel for
Beneficiary) upon any matters arising hereunder, including the
preparation, execution, and interpretation of the Loan Documents,
and shall be fully protected in relying as to legal matters on the
advice of counsel, (ii) to execute any of the trusts and powers
hereof and to perform any duty hereunder either directly or through
his agents or attorneys, (iii) to select and employ, in and about
the execution of his duties hereunder, suitable accountants,
engineers and other experts, agents and attorneys-in-fact, either
corporate or individual, not regularly in the employ of Trustee, and
Trustee shall not be answerable for any act, default, negligence, or
misconduct of any such accountant, engineer or other expert, agent
or attorney-in-fact, if selected with reasonable care, or for any
error of judgment or act done by Trustee in good faith, or be
otherwise responsible or accountable under any circumstances
whatsoever, except for Trustee's gross negligence or bad faith, and
(iv) any and all other lawful action as Beneficiary may instruct
Trustee to take to protect or enforce Beneficiary's rights
hereunder. Trustee shall not be personally liable in case of entry
by Trustee, or anyone entering by virtue of the powers herein
granted to Trustee, upon the Subject Property for debts contracted
for or liability or damages incurred in the management or operation
of the Subject Property. Trustee shall have the right to rely on any
instrument, document, or signature authorizing or supporting any
action taken or proposed to be taken by Trustee hereunder, believed
by Trustee in good faith to be genuine. Trustee shall be entitled to
reimbursement for expenses incurred by Trustee in the performance of
Trustee's duties hereunder and to reasonable compensation for such
of Trustee's services hereunder as shall be rendered. GRANTOR WILL,
FROM TIME TO TIME, PAY THE COMPENSATION DUE TO TRUSTEE HEREUNDER AND
REIMBURSE TRUSTEE FOR, AND INDEMNIFY AND HOLD HARMLESS TRUSTEE
AGAINST, ANY AND ALL LIABILITY AND EXPENSES WHICH MAY BE INCURRED BY
TRUSTEE IN THE PERFORMANCE OF TRUSTEE'S DUTIES.
(d) All moneys received by Trustee shall, until used or applied as
herein provided, be held in trust for the purposes for which they
were received, but need not be segregated in any manner from any
other moneys (except to the extent required by applicable law) and
Trustee shall be under no liability for interest on any moneys
received by Trustee hereunder.
(e) Should any deed, conveyance, or instrument of any nature be required
from Grantor by any Trustee or substitute Trustee to more fully and
certainly vest in and confirm to the Trustee or substitute Trustee
such estates, rights, powers, and duties, then, upon request by the
Trustee or substitute Trustee, any and all such deeds, conveyances
and instruments shall be made, executed, acknowledged, and delivered
and shall be caused to be recorded and/or filed by Grantor.
(f) By accepting or approving anything required to be observed,
performed, or fulfilled or to be given to Trustee pursuant to the
Loan Documents, including without limitation, any deed, conveyance,
instrument, officer's certificate, balance sheet, statement of
profit and loss or other financial statement, survey, appraisal, or
insurance policy, Trustee 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,
DEED OF TRUST - Page 8
or condition thereof, and such acceptance or approval thereof shall
not be or constitute any warranty or affirmation with respect
thereto by Trustee.
5.10 COMPENSATION; EXCULPATION; INDEMNIFICATION.
(a) Grantor shall pay Trustee's fees and reimburse Trustee for expenses
in the administration of this trust, including attorneys' fees.
Subject to the provisions of Section 7.12, Grantor shall pay to
Beneficiary reasonable compensation for services rendered concerning
this Deed of Trust, including without limit any statement of amounts
owing under any Secured Obligation. Beneficiary shall not directly
or indirectly be liable to Grantor or any other person as a
consequence of (i) the exercise of the rights, remedies or powers
granted to Beneficiary in this Deed of Trust; (ii) the failure or
refusal of Beneficiary to perform or discharge any obligation or
liability of Grantor under any agreement related to the Subject
Property or Collateral or under this Deed of Trust; or (iii) any
loss sustained by Grantor or any third party resulting from
Beneficiary's failure (whether by malfeasance, nonfeasance or
refusal to act) to lease the Subject Property after an Event of
Default or from any other act or omission (regardless of whether
same constitutes negligence) of Beneficiary in managing the Subject
Property after an Event of Default unless the loss is caused by the
gross negligence or willful misconduct of Beneficiary and no such
liability shall be asserted against or imposed upon Beneficiary, and
all such liability is hereby expressly waived and released by
Grantor.
(b) GRANTOR INDEMNIFIES TRUSTEE AND BENEFICIARY AGAINST, AND HOLDS
TRUSTEE AND BENEFICIARY HARMLESS FROM, ALL LOSSES, DAMAGES,
LIABILITIES, CLAIMS, CAUSES OF ACTION, JUDGMENTS, COURT COSTS,
ATTORNEYS' FEES AND OTHER LEGAL EXPENSES, COST OF EVIDENCE OF TITLE,
COST OF EVIDENCE OF VALUE, AND OTHER EXPENSES WHICH EITHER MAY
SUFFER OR INCUR: (I) BY REASON OF THIS DEED OF TRUST; (II) BY REASON
OF THE EXECUTION OF THIS TRUST OR IN PERFORMANCE OF ANY ACT REQUIRED
OR PERMITTED HEREUNDER OR BY LAW; (III) AS A RESULT OF ANY FAILURE
OF GRANTOR TO PERFORM GRANTOR'S OBLIGATIONS; OR (IV) BY REASON OF
ANY ALLEGED OBLIGATION OR UNDERTAKING ON BENEFICIARY'S PART TO
PERFORM OR DISCHARGE ANY OF THE REPRESENTATIONS, WARRANTIES,
CONDITIONS, COVENANTS OR OTHER OBLIGATIONS CONTAINED IN ANY OTHER
DOCUMENT RELATED TO THE SUBJECT PROPERTY AND COLLATERAL. THE ABOVE
OBLIGATION OF GRANTOR TO INDEMNIFY AND HOLD HARMLESS TRUSTEE AND
BENEFICIARY SHALL SURVIVE THE RELEASE AND CANCELLATION OF THE
SECURED OBLIGATIONS AND THE RELEASE OR PARTIAL RELEASE OF THE LIEN
OF THIS DEED OF TRUST.
(c) Grantor shall pay all amounts and indebtedness arising under this
Section 5.10 immediately upon demand by Trustee or Beneficiary
together with interest thereon from the date the indebtedness arises
at the rate of interest then applicable to the principal balance of
the Note as specified therein.
5.11 SUBSTITUTION OF TRUSTEES. Trustee may resign by the giving of notice of
such resignation in writing or verbally to Beneficiary. If Trustee shall
die, resign, or become disqualified from acting in the execution of this
trust, or if, for any reason, Beneficiary shall prefer to appoint a
substitute trustee or multiple substitute trustees, or successive
substitute trustees or successive multiple substitute trustees, to act
instead of the aforenamed Trustee, Beneficiary shall have full power to
appoint a substitute trustee (or, if preferred, multiple substitute
trustees) in succession who shall succeed (and if multiple substitute
trustees are appointed, each of such multiple substitute trustees shall
succeed) to all the estates, rights, powers, and duties of the aforenamed
Trustee. Such appointment may be executed by any authorized agent of
Beneficiary, and if such Beneficiary be a corporation and such appointment
be executed in its behalf by any officer of such corporation, such
appointment shall be conclusively presumed to be executed with authority
and shall be valid and sufficient without proof of any action by the board
of directors or any superior officer of the corporation. Grantor hereby
ratifies and confirms any and all acts which the aforenamed Trustee, or
his successor or successors in this trust, shall do lawfully by virtue
hereof. If multiple substitute Trustees are appointed, each of such
multiple
DEED OF TRUST - Page 9
substitute Trustees shall be empowered and authorized to act alone without
the necessity of the joinder of the other multiple substitute trustees,
whenever any action or undertaking of such substitute trustees is
requested or required under or pursuant to this Deed of Trust or
applicable law. Any substitute Trustee appointed pursuant to any of the
provisions hereof shall, without any further act, deed, or conveyance,
become vested with all the estates, properties, rights, powers, and trusts
of its or his predecessor in the rights hereunder with like effect as if
originally named as Trustee herein; but nevertheless, upon the written
request of Beneficiary or of the substitute Trustee, the Trustee ceasing
to act shall execute and deliver any instrument transferring to such
substitute Trustee, upon the trusts herein expressed, all the estates,
properties, rights, powers, and trusts of the Trustee so ceasing to act,
and shall duly assign, transfer and deliver any of the property and moneys
held by such Trustee to the substitute Trustee so appointed in the
Trustee's place.
5.12 DUE ON SALE OR ENCUMBRANCE. As used herein, the term "Loan" shall mean
both the "Line of Credit" and the "Term Loan" as such terms are defined in
the Loan Agreement. Grantor represents, agrees and acknowledges that:
(a) Ownership, operation and leasing of real property is a highly
complex activity which requires substantial knowledge of law and
business conditions and practices. Experience, financial stability,
managerial ability and a good reputation in the business community
enhance an owner's ability to obtain market rents and/or sales
prices and are taken into account by Beneficiary in approving loan
applications.
(b) Grantor has represented to Beneficiary, not only in the
representations and warranties contained in the Loan Documents, but
also in its initial loan application and in all of the negotiations
connected with Beneficiary making the Loan, certain facts concerning
Grantor's financial stability, managerial and operational ability,
reputation, skill, and credit worthiness. Beneficiary has relied
upon these representations and warranties as a substantial and
material consideration in its decision to make the Loan.
(c) The conditions and terms provided in the Loan Agreement were induced
by these representations and warranties and would not have been made
available by Beneficiary in the absence of these representations and
warranties.
(d) Beneficiary would not have made this Loan if Beneficiary did not
have the right to sell, transfer, assign, or grant participations in
the Loan and in the Loan Documents, and that such participations are
dependent upon the potential participants' reliance on such
representations and warranties.
(e) Grantor's financial stability and managerial and operational ability
and that of those persons or entities having a direct or beneficial
interest in Grantor are a substantial and material consideration to
any third parties who have entered or will enter into agreements
with Grantor.
(f) Beneficiary has relied upon the skills and services offered by such
third parties and the provision of such skills and services is
jeopardized if Grantor breaches its covenants contained below
regarding Transfers.
(g) A transfer of possession of or title to the Subject Property, or a
change in the person or entity operating or managing the Subject
Property would substantially increase the risk of an Event of
Default under the Loan Documents and significantly and materially
impair and reduce Beneficiary's security for the Note.
(h) As used herein, the term "Transfer" shall mean each of the following
actions or events: the sale, transfer, assignment, lease as a whole,
encumbrance, hypothecation, mortgage or pledge in any manner
whatsoever, whether voluntarily, involuntarily or by operation of
law of: (i) the Subject Property or Collateral or any interest
therein; (ii) title to any other security more specifically
described in any Loan Document; (iii) Grantor's right, title and/or
interest in the Loan Documents and any
DEED OF TRUST - Page 10
subsequent documents executed by Grantor in connection therewith; or
(iv) legal or beneficial ownership of any partnership interest in
Grantor if Grantor is a partnership.
(i) It is expressly agreed that Beneficiary may predicate Beneficiary's
decision to grant or withhold consent to a Transfer on such terms
and conditions as Beneficiary may require, in Beneficiary's sole
discretion, including without limitation (i) consideration of the
creditworthiness of the party to whom such Transfer will be made and
its management ability with respect to the Subject Property, (ii)
consideration of whether the security for repayment, performance and
discharge of the Secured Obligations, or Beneficiary's ability to
enforce its rights, remedies, and recourses with respect to such
security, will be impaired in any way by the proposed Transfer,
(iii) an increase in the rate of interest payable under the Note or
any other change in the terms and provisions of the Note and other
Loan Documents, (iv) reimbursement of Beneficiary for all costs and
expenses incurred by Beneficiary in investigating the
creditworthiness and management ability of the party to whom such
Transfer will be made and in determining whether Beneficiary's
security will be impaired by the proposed Transfer, (v) payment to
Beneficiary of a transfer fee to cover the cost of documenting the
Transfer in its records, (vi) payment of Beneficiary's reasonable
attorneys' fees in connection with such Transfer, (vii) endorsements
(to the extent available under applicable law) to any existing
mortgagee title insurance policies or construction binders insuring
Beneficiary's liens and security interests covering the Subject
Property, and (viii) require additional security for the payment,
performance and discharge of the Secured Obligations. If
Beneficiary's consent should be given, any Transfer shall be subject
to the Loan Documents and any transferee of Grantor's interest
shall: (i) assume all of Grantor's obligations thereunder; and (ii)
agree to be bound by all provisions and perform all obligations
contained therein; provided, however, that such assumption shall not
release Grantor or any maker or any guarantor of the Note from any
liability thereunder without the prior written consent of
Beneficiary. In the event of any Transfer without the prior written
consent of Beneficiary, whether or not Beneficiary elects to enforce
its right to accelerate the Loan pursuant to Sections 6.1 and 6.2,
all sums owing under the Note, as well as all other charges,
expenses and costs owing under the Loan Documents, shall at the
option of Beneficiary, automatically bear interest at four percent
(4%) above the rate provided in the Note, but not in excess of the
Maximum Rate (as defined in the Loan Agreement), from the date (or
any date thereafter) of such unconsented to Transfer. Grantor
acknowledges that the automatic shift(s) to this alternate rate is
reasonable since the representations that Beneficiary relied upon in
making the Loan may no longer be relied upon. A consent by
Beneficiary to one or more Transfers shall not be construed as a
consent to further Transfers or as a waiver of Beneficiary's consent
with respect to future Transfers.
5.13 RELEASES, EXTENSIONS, MODIFICATIONS AND ADDITIONAL SECURITY. Without
notice to or the consent, approval or agreement of any persons or entities
having any interest at any time in the Subject Property and Collateral or
in any manner obligated under the Secured Obligations ("Interested
Parties"), Beneficiary may, from time to time, release any person or
entity from liability for the payment or performance of any Secured
Obligation, take any action or make any agreement extending the maturity
or otherwise altering the terms or increasing the amount of any Secured
Obligation, or accept additional security or release all or a portion of
the Subject Property and Collateral and other security for the Secured
Obligations. None of the foregoing actions shall release or reduce the
personal liability of any of said Interested Parties, or release or impair
the priority of the lien of and security interests created by this Deed of
Trust upon the Subject Property and Collateral.
5.14 RELEASES. If the Secured Obligations are paid, performed and discharged in
full in accordance with the terms of this Deed of Trust, the Note, and the
other Loan Documents, then this conveyance shall become null and void and
be released by Beneficiary at Grantor's request and expense, and
Beneficiary shall have no further obligation to make advances under and
pursuant to the provisions hereof or in the other Loan Documents.
In addition, provided no Event of Default has occurred and is continuing at the
time, upon request of Grantor made at any time after or contemporaneously with
the payment in full of all principal of the Term Note and all accrued, unpaid
interest thereon, Beneficiary will release this Deed of Trust by delivery of a
proper written release executed and acknowledged in recordable form.
DEED OF TRUST - Page 11
5.15 SUBROGATION. Beneficiary shall be subrogated to the lien of all
encumbrances, whether released of record or not, paid in whole or in part
by Beneficiary pursuant to the Loan Documents or by the proceeds of any
loan secured by this Deed of Trust.
5.16 RIGHT OF INSPECTION. Beneficiary, its agents and employees, may enter the
Subject Property at any reasonable time for the purpose of inspecting the
Subject Property and Collateral and ascertaining Grantor's compliance with
the terms hereof.
5.17 CONTRACTS. Grantor will deliver to Beneficiary a copy of each Contract
promptly after the execution of same by all parties thereto. Within twenty
(20) days after a request by Beneficiary, Grantor shall prepare and
deliver to Beneficiary a complete listing of all Contracts, showing date,
term, parties, subject matter, concessions, whether any defaults exist,
and other information specified by Beneficiary, of or with respect to each
of such Contracts, together with a copy thereof (if so requested by
Beneficiary). Grantor represents and warrants that none of the Contracts
encumber or create a lien on the Subject Property, but are personal with
Grantor. As used herein, the term "Contract" shall mean any management
agreement, leasing and brokerage agreement, and operating or service
contract with respect to the Subject Property or Collateral.
5.18 REPRESENTATIONS OF GRANTOR.
(a) Legal Status. Grantor is qualified or licensed to do business in all
jurisdictions in which such qualification or licensing is required
or in which the failure to so qualify or to be so licensed could
have a material adverse effect on Grantor.
(b) Authorization and Validity. This Deed of Trust has been duly
authorized, and upon its execution and delivery in accordance with
the provisions hereof will constitute legal, valid and binding
agreements and obligations of Grantor, enforceable in accordance
with its terms.
(c) No Violation. The execution, delivery and performance by Grantor of
this Deed of Trust does not violate any provision of any law or
regulation, or result in any breach of or default under any
contract, obligation, indenture or other instrument to which Grantor
is a party or by which Grantor may be bound.
ARTICLE 6. DEFAULT PROVISIONS
6.1 EVENT OF DEFAULT. For all purposes hereof, the term "Event of Default"
shall mean any Transfer to which Beneficiary has not given its consent and
any other event or circumstance that would constitute an Event of Default
under and as defined in the Loan Agreement.
6.2 RIGHTS AND REMEDIES. At any time when an Event of Default has occurred and
is continuing, Beneficiary may, at Beneficiary's option, and by or through
Trustee, by Beneficiary itself or otherwise, do any one or more of the
following:
(a) Right to Accelerate. Beneficiary may, without notice, demand,
presentment, notice of nonpayment or nonperformance, protest, notice
of protest, notice of intent to accelerate, notice of acceleration,
or any other notice or any other action, all of which are hereby
waived by Grantor and all other parties obligated in any manner
whatsoever on the Secured Obligations, declare the entire unpaid
balance of the Secured Obligations immediately due and payable, and
upon such declaration, the entire unpaid balance of the Secured
Obligations shall be immediately due and payable. The failure to
exercise any remedy available to the Beneficiary shall not be deemed
to be a waiver of any rights or remedies of the Beneficiary under
the Loan Documents, at law or in equity.
(b) Right to Perform Grantor's Covenants. If Grantor has failed to keep
or perform any covenant whatsoever contained in this Deed of Trust
or the other Loan Documents, Beneficiary may, but shall not be
obligated to any person to do so, perform or attempt to perform said
covenant, and any
DEED OF TRUST - Page 12
payment made or expense incurred in the performance or attempted
performance of any such covenant shall be and become a part of the
Secured Obligations, and Grantor promises, upon demand, to pay to
Beneficiary, at the place where the Note is payable, all sums so
advanced or paid by Beneficiary, with interest from the date when
paid or incurred by Beneficiary at the rate of interest then
applicable on the outstanding principal balance of the Note. No such
payment by Beneficiary shall constitute a waiver of any Event of
Default. In addition to the liens and security interests hereof,
Beneficiary shall be subrogated to all rights, titles, liens, and
security interests securing the payment of any debt, claim, tax, or
assessment for the payment of which Beneficiary may make an advance,
or which Beneficiary may pay.
(c) Right of Entry. Beneficiary may, prior or subsequent to the
institution of any foreclosure proceedings, enter upon the Subject
Property, or any part thereof, and take exclusive possession of the
Subject Property and Collateral and of all books, records, and
accounts relating thereto and to exercise without interference from
Grantor any and all rights which Grantor has with respect to the
management, possession, operation, protection, or preservation of
the Subject Property and Collateral, including without limitation
the right to rent the same for the account of Grantor and to deduct
from such Payments all costs, expenses, and liabilities of every
character incurred by the Beneficiary in collecting such Payments
and in managing, operating, maintaining, protecting, or preserving
the Subject Property and Collateral and to apply the remainder of
such Payments on the Secured Obligations in such manner as
Beneficiary may elect. All such costs, expenses, and liabilities
incurred by the Beneficiary in collecting such Payments and in
managing, operating, maintaining, protecting, or preserving the
Subject Property and Collateral, if not paid out of Payments as
hereinabove provided, shall constitute a demand obligation owing by
Grantor and shall bear interest from the date of expenditure until
paid at the rate of interest then applicable on the outstanding
principal balance of the Note, all of which shall constitute a
portion of the Secured Obligations. If necessary to obtain the
possession provided for above, the Beneficiary may invoke any and
all legal remedies to dispossess Grantor, including specifically one
or more actions for forcible entry and detainer, trespass to try
title, and restitution. In connection with any action taken by the
Beneficiary pursuant to this subsection, the Beneficiary shall not
be liable for any loss sustained by Grantor resulting from any
failure to let the Subject Property, or any part thereof, or from
any other act or omission of the Beneficiary in managing the Subject
Property and Collateral unless such loss is caused by the willful
misconduct of the Beneficiary, nor shall the Beneficiary be
obligated to perform or discharge any obligation, duty, or liability
under any Lease or under or by reason hereof or the exercise of
rights or remedies hereunder. GRANTOR SHALL AND DOES HEREBY AGREE TO
INDEMNIFY BENEFICIARY FOR, AND TO HOLD HARMLESS BENEFICIARY FROM,
ANY AND ALL LIABILITY, LOSS, OR DAMAGE, WHICH MAY OR MIGHT BE
INCURRED BY BENEFICIARY UNDER ANY SUCH LEASE OR UNDER OR BY REASON
HEREOF OR THE EXERCISE OF RIGHTS OR REMEDIES HEREUNDER, AND FROM ANY
AND ALL CLAIMS AND DEMANDS WHATSOEVER WHICH MAY BE ASSERTED AGAINST
BENEFICIARY 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. Should Beneficiary incur any
such liability, the amount thereof, including without limitation
costs, expenses, and reasonable attorneys' fees, together with
interest thereon from the date of expenditure until paid at the rate
of interest then applicable on the outstanding principal balance of
the Note, shall be secured hereby, and Grantor shall reimburse the
Beneficiary therefor immediately upon demand. Nothing in this
subsection shall impose any duty, obligation, or responsibility upon
Beneficiary for the control, care, management, leasing, or repair of
the Subject Property and Collateral, nor for the carrying out of any
of the terms and conditions of any such Lease; nor shall it operate
to make Beneficiary responsible or liable for any waste committed on
the Subject Property and Collateral by the tenants or by any other
parties, or for any environmentally hazardous substances on or under
the Subject Property or Collateral, or for any dangerous or
defective condition of the Subject Property or Collateral or for any
negligence in the management, leasing, upkeep, repair, or control of
the Subject Property or Collateral resulting in loss or injury or
death to any tenant, licensee, employee, or stranger. Grantor hereby
assents to, ratifies, and confirms any and all actions of
Beneficiary with respect to the Subject Property and Collateral
taken under this subsection.
DEED OF TRUST - Page 13
The remedies in this subsection are in addition to other remedies
available to the Beneficiary and the exercise of the remedies in
this subsection shall not be deemed to be an election of nonjudicial
or judicial remedies otherwise available to the Beneficiary. The
remedies in this Section 6.2 are available under and governed by the
real property laws and by the personal property laws of the state in
which the Subject Property is located, including but not limited to,
the power to dispose of personal property in a commercially
reasonable manner under the UCC. No action by Beneficiary, taken
pursuant to this subsection, shall be deemed to be an election to
dispose of personal property under the UCC. Any receipt of
consideration received by Beneficiary pursuant to this subsection
shall be immediately credited against the Secured Obligations (in
the inverse order of maturity) and the value of said consideration
shall be treated like any other payment against the Secured
Obligations.
(d) Foreclosure-Power of Sale. Beneficiary may request Trustee to
proceed with foreclosure under the power of sale which is hereby
conferred, such foreclosure to be accomplished in accordance with
the following provisions:
(i) Public Sale. Trustee is hereby authorized and empowered, and
it shall be Trustee's special duty, upon such request of
Beneficiary, to sell the Subject Property and Collateral, or
any part thereof, at public auction to the highest bidder for
cash, with or without having taken possession of same. Any
such sale (including notice thereof) shall comply with the
applicable requirements, at the time of the sale, of Section
51.002 of the Texas Property Code or, if and to the extent
such statute is not then in force, with the applicable
requirements, at the time of the sale, of the successor
statute or statutes, if any, governing sales of Texas real
property under powers of sale conferred by deeds of trust. If
there is no statute in force at the time of the sale governing
sales of Texas real property under powers of sale conferred by
deeds of trust, such sale shall comply with applicable law, at
the time of the sale, governing sales of Texas real property
under powers of sale conferred by deeds of trust.
(ii) Right to Require Proof of Financial Ability and/or Cash Bid.
At any time during the bidding, the Trustee may require a
bidding party (A) to disclose its full name, state and city of
residence, occupation, and specific business office location,
and the name and address of the principal the bidding party is
representing (if applicable), and (B) to demonstrate
reasonable evidence of the bidding party's financial ability
(or, if applicable, the financial ability of the principal of
such bidding party), as a condition to the bidding party
submitting bids at the foreclosure sale. If any such bidding
party (the "Questioned Bidder") declines to comply with the
Trustee's requirement in this regard, or if such Questioned
Bidder does respond but the Trustee, in Trustee's sole and
absolute discretion, deems the information or the evidence of
the financial ability of the Questioned Bidder (or, if
applicable, the principal of such bidding party) to be
inadequate, then the Trustee may continue the bidding with
reservation; and in such event (1) the Trustee shall be
authorized to caution the Questioned Bidder concerning the
legal obligations to be incurred in submitting bids, and (2)
if the Questioned Bidder is not the highest bidder at the
sale, or if having been the highest bidder the Questioned
Bidder fails to deliver the cash purchase price payment
promptly to the Trustee, all bids by the Questioned Bidder
shall be null and void. The Trustee may, in Trustee's sole and
absolute discretion, determine that a credit bid may be in the
best interest of the Grantor and Beneficiary, and elect to
sell the Mortgaged Property for credit or for a combination of
cash and credit; provided, however, that the Trustee shall
have no obligation to accept any bid except an all cash bid.
In the event the Trustee requires a cash bid and cash is not
delivered within a reasonable time after conclusion of the
bidding process, as specified by the Trustee, but in no event
later than 3:45 p.m. local time on the day of sale, then said
contingent sale shall be null and void, the bidding process
may be recommenced, and any subsequent bids or sale shall be
made as if no prior bids were made or accepted.
(iii) Sale Subject to Unmatured Indebtedness. In addition to the
rights and powers of sale granted under the preceding
provisions of this subsection, if an Event of Default has
occurred and is continuing because of a failure of Grantor to
pay any portion of the Secured Obligations
DEED OF TRUST - Page 14
when due, Beneficiary may, at Beneficiary's option, at once or
at any time thereafter while any matured portion remains
unpaid, without declaring the entire Secured Obligations to be
due and payable, orally or in writing direct Trustee to
enforce this trust and to sell the Subject Property and
Collateral subject to such unmatured Secured Obligations and
to the rights, powers, liens, security interests, and
assignments securing or providing recourse for payment of such
unmatured Secured Obligations, in the same manner, all as
provided in the preceding provisions of this subsection. Sales
made without maturing the Secured Obligations may be made
hereunder whenever there is an Event of Default outstanding
because of a default in the payment of any portion of the
Secured Obligations, without exhausting the power of sale
granted hereby, and without affecting in any way the power of
sale granted under this subsection, the unmatured balance of
the Secured Obligations or the rights, powers, liens, security
interests, and assignments securing or providing recourse for
payment of the Secured Obligations.
(iv) Partial Foreclosure. Sale of a part of the Subject Property or
Collateral shall not exhaust the power of sale, but sales may
be made from time to time until the Secured Obligations is
paid, performed and discharged in full. It is intended by each
of the foregoing provisions of this subsection that Trustee
may, after any request or direction by Beneficiary, sell not
only the Subject Property, but also the Collateral and other
interests constituting security for the Loan under the Loan
Documents, or any part thereof, along with the Subject
Property and Collateral or any part thereof, as a unit and as
a part of a single sale, or may sell at any time or from time
to time any part or parts of the Subject Property and
Collateral separately from the remainder of the Subject
Property and Collateral. It shall not be necessary to have
present or to exhibit at any sale any of the Subject Property
and Collateral.
(v) Trustee's Deeds. After any sale under this subsection, Trustee
shall make good and sufficient deeds, assignments, and other
conveyances to the purchaser or purchasers thereunder in the
name of Grantor, conveying the Subject Property and Collateral
or any part thereof so sold to the purchaser or purchasers
with general warranty of title by Grantor. It is agreed that
in any deeds, assignments or other conveyances given by
Trustee, any and all statements of fact or other recitals
therein made as to the identity of Beneficiary, the occurrence
or existence of any Event of Default, the notice of intention
to accelerate, or acceleration of, the maturity of the Secured
Obligations, the request to sell, notice of sale, time, place,
terms and manner of sale, and receipt, distribution, and
application of the money realized therefrom, the due and
proper appointment of a substitute trustee, and without being
limited by the foregoing, any other act or thing having been
duly done by or on behalf of Beneficiary or by or on behalf of
Trustee, shall be taken by all courts of law and equity as
prima facie evidence that such statements or recitals state
true, correct, and complete facts and are without further
question to be so accepted, and Grantor does hereby ratify and
confirm any and all acts that Trustee may lawfully do in the
premises by virtue hereof.
(e) Beneficiary's Judicial Remedies. Beneficiary, or Trustee, upon
written request of Beneficiary, may proceed by suit or suits, at law
or in equity, to enforce the payment, performance and discharge of
the Secured Obligations in accordance with the terms hereof, of the
Note, and the other Loan Documents, to foreclose the liens and
security interests of this Deed of Trust as against all or any part
of the Subject Property and Collateral, and to have all or any part
of the Subject Property and Collateral sold under the judgment or
decree of a court of competent jurisdiction. This remedy shall be
cumulative of any other nonjudicial remedies available to the
Beneficiary with respect to the Loan Documents. Proceeding with a
request or receiving a judgment for legal relief shall not be or be
deemed to be an election of remedies or bar any available
nonjudicial remedy of the Beneficiary.
(f) Beneficiary's Right to Appointment of Receiver. Beneficiary, as a
matter of right and without regard to the sufficiency of the
security for payment, performance and discharge of the Secured
Obligations, without notice to Grantor and without any showing of
insolvency, fraud, or mismanagement on the part of Grantor, and
without the necessity of filing any judicial or other proceeding
other than the
DEED OF TRUST - Page 15
proceeding for appointment of a receiver, shall be entitled to the
appointment of a receiver or receivers of the Subject Property and
Collateral or any part thereof, and of the Payments, and Grantor
hereby irrevocably consents to the appointment of a receiver or
receivers. Any receiver appointed pursuant to the provisions of this
subsection shall have the usual powers and duties of receivers in
such matters.
(g) Beneficiary's UCC Remedies. The Beneficiary may exercise its rights
of enforcement with respect to the Collateral under the UCC, and in
conjunction with, in addition to or in substitution for the rights
and remedies under the UCC the Beneficiary may, and Grantor agrees,
as follows: (i) without demand or notice to Grantor, enter upon the
Subject Property to take possession of, assemble, receive, and
collect the Collateral, or any part thereof, or to render it
unusable; (ii) require Grantor to assemble the Collateral and make
it available at a place Beneficiary designates which is mutually
convenient to allow Beneficiary to take possession or dispose of the
Collateral; (iii) written notice mailed to Grantor as provided
herein at least ten (10) days prior to the date of public sale of
the Collateral or prior to the date after which private sale of the
Collateral will be made shall constitute reasonable notice; (iv) any
sale made pursuant to the provisions of this subsection shall be
deemed to have been a public sale conducted in a commercially
reasonable manner if held contemporaneously with the sale of the
Subject Property under power of sale as provided herein upon giving
the same notice with respect to the sale of the Collateral hereunder
as is required for such sale of the Subject Property under power of
sale, and such sale shall be deemed to be pursuant to a security
agreement covering both real and personal property under the UCC;
(v) in the event of a foreclosure sale, whether made by the Trustee
under the terms hereof, or under judgment of a court, the Collateral
and the Subject Property may, at the option of the Beneficiary, be
sold as a whole; (vi) it shall not be necessary that the Beneficiary
take possession of the Collateral, or any part thereof, prior to the
time that any sale pursuant to the provisions of this subsection is
conducted, and it shall not be necessary that the Collateral or any
part thereof be present at the location of such sale; (vii) prior to
application of proceeds of disposition of the Collateral to the
Secured Obligations, such proceeds shall be applied to the
reasonable expenses of retaking, holding, preparing for sale or
lease, selling, leasing and the like, and the reasonable attorneys'
fees and legal expenses incurred by the Beneficiary; (viii) after
notification, if any, hereafter provided in this subsection,
Beneficiary may sell, lease, or otherwise dispose of the Collateral,
or any part thereof, in one or more parcels at public or private
sale or sales, at Beneficiary's offices or elsewhere, for cash, on
credit, or for future delivery. Upon the request of Beneficiary,
Grantor shall assemble the Collateral and make it available to
Beneficiary at any place designated by Beneficiary that is
reasonably convenient to Grantor and Beneficiary. Grantor agrees
that Beneficiary shall not be obligated to give more than ten (10)
days' written notice of the time and place of any public sale or of
the time after which any private sale may take place and that such
notice shall constitute reasonable notice of such matters. Grantor
shall be liable for all expenses of retaking, holding, preparing for
sale, or the like, and all attorneys' fees, legal expenses, and all
other costs and expenses incurred by Beneficiary in connection with
the collection of the Secured Obligations and the enforcement of
Beneficiary's rights under the Loan Documents. Beneficiary shall
apply the proceeds of the sale of the Collateral against the Secured
Obligations in accordance with the requirements of this Deed of
Trust. Grantor shall remain liable for any deficiency if the
proceeds of any sale or disposition of the Collateral are
insufficient to pay, perform and discharge the Secured Obligations
in full. Grantor waives all rights of marshalling in respect of the
Personalty; (ix) any and all statements of fact or other recitals
made in any xxxx of sale or assignment or other instrument
evidencing any foreclosure sale hereunder, the nonpayment of the
Secured Obligations, the occurrence of any Event of Default, the
Beneficiary having declared all or a portion of such Secured
Obligations to be due and payable, the notice of time, place, and
terms of sale and of the properties to be sold having been duly
given, or any other act or thing having been duly done by
Beneficiary, shall be taken as prima facie evidence of the truth of
the facts so stated and recited; and (x) Beneficiary 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 Beneficiary, including the
sending of notices and the conduct of the sale, but in the name and
on behalf of Beneficiary.
DEED OF TRUST - Page 16
(h) Rights Relating to Leases and Rents. Grantor has, pursuant to
Article 3 of this Deed of Trust, assigned to Beneficiary all
Payments under each of the Leases covering all or any portion of the
Subject Property. Beneficiary, or Trustee on Beneficiary's behalf,
may at any time, and without notice, either in person, by agent, or
by receiver to be appointed by a court, enter and take possession of
the Subject Property or any part thereof, and in its own name, xxx
for or otherwise collect the Payments. All Payments collected by
Beneficiary, or Trustee acting on Beneficiary's behalf, shall be
applied as provided for in this Deed of Trust; provided, however,
that if the costs, expenses, and attorneys' fees shall exceed the
amount of Payments collected, the excess shall be added to the
Secured Obligations, shall bear interest at the rate of interest
then applicable on the outstanding principal balance of the Note,
and shall be immediately due and payable. The entering upon and
taking possession of the Subject Property, the collection of
Payments, and the application thereof as aforesaid shall not cure or
waive any Event of Default or notice of default, if any, hereunder
nor invalidate any act done pursuant to such notice, except to the
extent any such Event of Default is fully cured. Failure or
discontinuance by Beneficiary, or Trustee on Beneficiary's behalf,
at any time or from time to time, to collect said Payments shall not
in any manner impair the subsequent enforcement by Beneficiary, or
Trustee on Beneficiary's behalf, of the right, power and authority
herein conferred upon it. Nothing contained herein, nor the exercise
of any right, power, or authority herein granted to Beneficiary, or
Trustee on Beneficiary's behalf, shall be, or shall be construed to
be, an affirmation by it of any tenancy, lease, or option, nor an
assumption of liability under, nor the subordination of, the lien of
this Deed of Trust, to any such tenancy, lease, or option, nor an
election of judicial relief, if any such relief is requested or
obtained as to Leases or Payments, with respect to the Subject
Property or any other collateral given by Grantor to Beneficiary. In
addition, from time to time Beneficiary may elect, and notice hereby
is given to each lessee under any Lease, to subordinate the lien of
this Deed of Trust to any Lease by unilaterally executing and
recording an instrument of subordination, and upon such election the
lien of this Deed of Trust shall be subordinate to the Lease
identified in such instrument of subordination; provided, however,
in each instance such subordination will not affect or be applicable
to, and expressly excludes any lien, charge, encumbrance, security
interest, claim, easement, restriction, option, covenant and other
rights, titles, interests or estates of any nature whatsoever with
respect to all or any portion of the Subject Property and Collateral
to the extent that the same may have arisen or intervened during the
period between the recordation of this Deed of Trust and the
execution of the Lease identified in such instrument of
subordination.
(i) Other Rights. Beneficiary (i) may surrender the insurance policies
maintained pursuant hereto or the other Loan Documents or any part
thereof, and upon receipt shall apply the unearned premiums as a
credit on the Secured Obligations, in accordance herewith, and, in
connection therewith, Grantor hereby appoints Beneficiary as agent
and attorney-in-fact (which is coupled with an interest and is
therefore irrevocable) for Grantor to collect such premiums; and
(ii) apply the reserve for impositions, if any, required by the
provisions of this Deed of Trust, toward payment of the Secured
Obligations; and (iii) shall have and may exercise any and all other
rights and remedies which Beneficiary may have at law or in equity,
or by virtue of any Loan Document or under the UCC, or otherwise.
(j) Beneficiary as Purchaser. Beneficiary may be the purchaser of the
Subject Property and Collateral or any part thereof, at any sale
thereof, whether such sale be under the power of sale herein vested
in Trustee or upon any other foreclosure of the liens and security
interests hereof, or otherwise, and Beneficiary shall, upon any such
purchase, acquire good title to the Subject Property and Collateral
so purchased, free of the liens and security interests hereof,
unless the sale was made subject to an unmatured portion of the
Secured Obligations. The Beneficiary, as purchaser, shall be treated
in the same manner as any third party purchaser and the proceeds of
the Beneficiary's purchase shall be applied in accordance with the
requirements of this Deed of Trust.
(k) Possession After Foreclosure. If the liens or security interests
hereof shall be foreclosed by power of sale granted herein, by
judicial action, or otherwise, the purchaser at any such sale shall
receive, as an incident to purchaser's ownership, immediate
possession of the property purchased, and if Grantor or Grantor's
successors shall hold possession of said property or any part
thereof subsequent to
DEED OF TRUST - Page 17
foreclosure, Grantor and Grantor's successors shall be considered as
tenants at sufferance of the purchaser at foreclosure sale (without
limitation of other rights or remedies, at a reasonable rental per
day, due and payable daily, based upon the value of the portion of
the Subject Property and Collateral so occupied or possessed and
sold to such purchaser), and anyone occupying or possessing such
portion of the Subject Property and Collateral, after demand is made
for possession thereof, shall be guilty of forcible detainer and
shall be subject to eviction and removal, forcible or otherwise,
with or without process of law, and all damages by reason thereof
are hereby expressly waived.
(l) Abandonment of Sale. In the event a foreclosure hereunder is
commenced by Trustee in accordance with subsection (d) hereof, at
any time before the sale, Trustee may abandon the sale, and
Beneficiary may then institute suit for the collection of the
Secured Obligations and for the foreclosure of the liens and
security interests hereof and of the Loan Documents. If Beneficiary
should institute a suit for the collection of the Secured
Obligations and for a foreclosure of the liens and security
interests hereof, Beneficiary may, at any time before the entry of a
final judgment in said suit, dismiss the same and require Trustee to
sell the Subject Property and Collateral or any part thereof in
accordance with the provisions of this Deed of Trust.
6.3 APPLICATION OF FORECLOSURE SALE PROCEEDS. The proceeds from any sale,
lease, or other disposition made pursuant to Section 6.2, or the proceeds
from the surrender of any insurance policies pursuant hereto, or any
Payments collected by Beneficiary from the Subject Property and
Collateral, or the reserve for impositions, if any, required by the
provisions of this Deed of Trust or sums received pursuant to a
condemnation or proceeds from insurance which Beneficiary elects to apply
to the Secured Obligations, shall be applied by Trustee, or by
Beneficiary, as the case may be, to the Secured Obligations in the
following order and priority: (i) to the payment of all expenses of
advertising, selling, and conveying the Subject Property and Collateral or
part thereof, and/or prosecuting or otherwise collecting Payments,
proceeds, premiums, or other sums including reasonable attorneys' fees and
a reasonable fee or commission to Trustee, not to exceed five percent (5%)
of the proceeds thereof or sums so received; (ii) to the remainder of the
Secured Obligations; (iii) the balance, if any and to the extent
applicable, remaining after the full and final payment, performance and
discharge of the Secured Obligations to the holder or beneficiary of any
inferior liens covering the Subject Property and Collateral, if any, in
order of the priority of such inferior liens (Trustee and Beneficiary
shall hereby be entitled to rely exclusively upon a commitment for title
insurance issued to determine such priority); and (iv) the cash balance,
if any, to the Grantor. The application of proceeds of sale or other
proceeds as otherwise provided herein shall be deemed to be a payment of
the Secured Obligations like any other payment. The balance of the Secured
Obligations remaining unpaid, if any, shall remain fully due and owing in
accordance with the terms of the Note or the other Loan Documents.
6.4 APPLICATION OF OTHER SUMS. All sums received by Beneficiary under Section
6.2 or Section 3.2, less all costs and expenses incurred by Beneficiary or
any receiver under Section 6.2 or Section 3.2, including, without
limitation, attorneys' fees, shall be applied in payment of the Secured
Obligations in such order as Beneficiary shall determine in its sole
discretion; provided, however, Beneficiary shall have no liability for
funds not actually received by Beneficiary.
6.5 NO CURE OR WAIVER. Neither Beneficiary's nor Trustee's nor any receiver's
entry upon and taking possession of all or any part of the Subject
Property and Collateral, nor any collection of rents, issues, profits,
insurance proceeds, condemnation proceeds or damages, other security or
proceeds of other security, or other sums, nor the application of any
collected sum to any Secured Obligation, nor the exercise of or failure to
exercise any other right or remedy by Beneficiary or Trustee or any
receiver shall cure or waive any breach, Event of Default or notice of
default under this Deed of Trust, or nullify the effect of any notice of
default or sale (unless all Secured Obligations then due have been paid
and performed and Grantor has cured all other defaults), or impair the
status of the security, or prejudice Beneficiary or Trustee in the
exercise of any right or remedy, or be construed as an affirmation by
Beneficiary of any tenancy, lease or option or a subordination of the lien
of or security interest created by this Deed of Trust.
6.6 PAYMENT OF COSTS, EXPENSES AND ATTORNEYS' FEES. Grantor agrees to pay to
Beneficiary immediately and without demand all costs and expenses incurred
by Trustee and Beneficiary pursuant to
DEED OF TRUST - Page 18
Section 6.2 (including, without limitation, court costs and attorneys'
fees, whether incurred in litigation or not) with interest from the date
of expenditure until said sums have been paid at the rate of interest then
applicable to the principal balance of the Note as specified therein. In
addition, Grantor shall pay to Trustee all Trustee's fees hereunder and
shall reimburse Trustee for all expenses incurred in the administration of
this trust, including, without limitation, any attorneys' fees.
6.7 POWER TO FILE NOTICES AND CURE EVENTS OF DEFAULT. Grantor hereby
irrevocably appoints Beneficiary and its successors and assigns, as its
attorney-in-fact, which agency is coupled with an interest,: (a) to
execute and/or record, at any time when any Event of Default has occurred
and is continuing, any notices of commencement or completion of
construction of the Improvements, or any other notices that Beneficiary
deems appropriate to protect Beneficiary's interest, (b) upon the issuance
of a deed pursuant to the foreclosure of the lien of this Deed of Trust or
the delivery of a deed in lieu of foreclosure, to execute all instruments
of assignment or further assurance with respect to the Collateral, Leases
and Payments in favor of the grantee of any such deed, as may be necessary
or desirable for such purpose, (c) to prepare, execute and file or record
financing statements, continuation statements, applications for
registration and like papers necessary to create, perfect or preserve
Beneficiary's security interests and rights in or to any of the
Collateral, and (d) at any time when any Event of Default has occurred and
is continuing, to perform any obligation of Grantor hereunder; provided,
however, that: (i) Beneficiary as such attorney-in-fact shall only be
accountable for such funds as are actually received by Beneficiary; and
(ii) Beneficiary shall not be liable to Grantor or any other person or
entity for any failure to act (whether such failure constitutes
negligence) by Beneficiary under this Section.
ARTICLE 7. MISCELLANEOUS PROVISIONS
7.1 ADDITIONAL PROVISIONS. The Loan Documents grant further rights to
Beneficiary and contain further agreements and affirmative and negative
covenants by Grantor which apply to this Deed of Trust and to the Subject
Property and such further rights and agreements are incorporated herein by
this reference.
7.2 MERGER. No merger shall occur as a result of Beneficiary's acquiring any
other estate in, or any other lien on, the Subject Property unless
Beneficiary consents to a merger in writing.
7.3 OBLIGATIONS OF GRANTOR, JOINT AND SEVERAL. If more than one person has
executed this Deed of Trust as "Grantor", the obligations of all such
persons hereunder shall be joint and several.
7.4 RECOURSE TO SEPARATE PROPERTY. Any married person who executes this Deed
of Trust as a Grantor agrees that any money judgment which Beneficiary or
Trustee obtains pursuant to the terms of this Deed of Trust or any other
obligation of that married person secured by this Deed of Trust may be
collected by execution upon that person's separate property, and any
community property which may be executed upon or seized for satisfaction
of such obligations under applicable law.
7.5 WAIVER OF MARSHALLING RIGHTS. Grantor, for itself and for all parties
claiming through or under Grantor, and for all parties who may acquire a
lien on or interest in the Subject Property and Collateral, hereby waives
all rights to have the Subject Property and Collateral and/or any other
property which is now or later may be security for any Secured Obligation
("Other Property") marshalled upon any foreclosure of the lien of this
Deed of Trust or on a foreclosure of any other lien or security interest
against any security for any of the Secured Obligations. Beneficiary shall
have the right to sell, and any court in which foreclosure proceedings may
be brought shall have the right to order a sale of, the Subject Property
and any or all of the Collateral or Other Property as a whole or in
separate parcels, in any order that Beneficiary may designate.
7.6 RULES OF CONSTRUCTION. When the identity of the parties or other
circumstances make it appropriate the masculine gender includes the
feminine and/or neuter, and the singular number includes the plural. The
term "Subject Property" and "Collateral" means all and any part of the
Subject Property and Collateral, respectively, and any interest in the
Subject Property and Collateral, respectively.
DEED OF TRUST - Page 19
7.7 SUCCESSORS IN INTEREST. The terms, covenants, and conditions herein
contained shall be binding upon and inure to the benefit of the heirs,
successors and assigns of the parties hereto; provided, however, that this
Section 7.7 does not waive or modify the provisions of Section 6.1(d).
7.8 EXECUTION IN COUNTERPARTS. To facilitate execution, this instrument may be
executed in as many counterparts as may be convenient or required. It
shall not be necessary that the signature or acknowledgment of, or on
behalf of, each party, or that the signature of all persons required to
bind any party, or the acknowledgment of such party, appear on each
counterpart. All counterparts shall collectively constitute a single
instrument. It shall not be necessary in making proof of this instrument
to produce or account for more than a single counterpart containing the
respective signatures of, or on behalf of, and the respective
acknowledgments of, each of the parties hereto. Any signature or
acknowledgment page to any counterpart may be detached from such
counterpart without impairing the legal effect of the signatures or
acknowledgments thereon and thereafter attached to another counterpart
identical thereto except having attached to it additional signature or
acknowledgment pages.
7.9 GOVERNING LAW. THIS DEED OF TRUST, THE NOTE AND THE OTHER LOAN DOCUMENTS
(EXCEPT TO THE EXTENT, AND ONLY TO THE EXTENT, SPECIFICALLY PROVIDED
THEREIN) SHALL BE GOVERNED BY AND CONSTRUED ACCORDING TO THE LAWS OF THE
STATE OF TEXAS FROM TIME TO TIME IN EFFECT (OTHER THAN THE RULES GOVERNING
CONFLICTS OF LAWS), EXCEPT TO THE EXTENT (i) OF PROCEDURAL AND SUBSTANTIVE
MATTERS RELATING ONLY TO THE CREATION, PERFECTION, VALIDITY, FORECLOSURE
AND ENFORCEMENT OF RIGHTS, LIENS, SECURITY INTEREST AND REMEDIES AGAINST
THE SUBJECT PROPERTY, WHICH MATTERS SHALL BE GOVERNED BY THE LAWS OF THE
STATE IN WHICH THE SUBJECT PROPERTY IS LOCATED, AND (ii) THAT THE LAWS OF
THE UNITED STATES OF AMERICA AND ANY RULES, REGULATIONS OR ORDERS ISSUED
OR PROMULGATED THEREUNDER, APPLICABLE TO THE AFFAIRS AND TRANSACTIONS
ENTERED INTO BY THE PARTIES, OTHERWISE PREEMPT TEXAS LAW OR THE LAW OF THE
STATE IN WHICH THE SUBJECT PROPERTY IS LOCATED, IN WHICH EVENT SUCH
FEDERAL LAW SHALL CONTROL.
7.10 INCORPORATION. Exhibit A as attached is incorporated into this Deed
of Trust by this reference.
7.11 NOTICES. All notices or other communications required or permitted to be
given pursuant to this Deed of Trust shall be in writing and shall be
given in accordance with the provisions of the Loan Agreement.
7.12 INTEREST PROVISIONS. It is the intention of the parties to comply strictly
with applicable usury laws. Accordingly, notwithstanding any provision to
the contrary in the Loan Documents, in no event shall any Loan Documents
require the payment or permit the payment, taking, reserving, receiving,
collection or charging of any sums constituting interest under applicable
laws that exceed the maximum amount permitted by such laws, as the same
may be amended or modified from time to time (the "Maximum Rate"). If any
such excess interest is called for, contracted for, charged, taken,
reserved or received in connection with any Loan Documents, or in any
communication by or any other person to Grantor or any other person, or in
the event that all or part of the principal or interest hereof or thereof
shall be prepaid or accelerated, so that under any of such circumstances
or under any other circumstance whatsoever the amount of interest
contracted for, charged, taken, reserved or received on the amount of
principal actually outstanding from time to time under the Loan Documents
shall exceed the Maximum Rate, then in such event it is agreed that: (i)
the provisions of this paragraph shall govern and control; (ii) neither
Grantor nor any other person or entity now or hereafter liable for the
payment of any Loan Documents shall be obligated to pay the amount of such
interest to the extent it is in excess of the Maximum Rate; (iii) any such
excess interest which is or has been received by Beneficiary,
notwithstanding this paragraph, shall be credited against the then unpaid
principal balance hereof or thereof, or if any of the Loan Documents has
been or would be paid in full by such credit, refunded to Grantor; and
(iv) the provisions of each of the Loan Documents, and any other
communication to Grantor, shall immediately be deemed reformed and such
excess interest reduced, without the necessity of executing any other
document, to the Maximum Rate. The right to accelerate the maturity of the
Loan Documents does not include the right to accelerate, collect or charge
unearned interest, but only such interest that has otherwise accrued as of
the date of acceleration. Without limiting the foregoing, all calculations
of the rate of interest contracted for, charged,
DEED OF TRUST - Page 20
taken, reserved or received in connection with any of the Loan Documents
which are made for the purpose of determining whether such rate exceeds
the Maximum Rate shall be made to the extent permitted by applicable laws
by amortizing, prorating, allocating and spreading during the period of
the full term of such Loan Documents, including all prior and subsequent
renewals and extensions hereof or thereof, all interest at any time
contracted for, charged, taken, reserved or received by Beneficiary. The
terms of this paragraph shall be deemed to be incorporated into each of
the other Loan Documents. To the extent that either Chapter 303 or 306, or
both, of the Texas Finance Code apply in determining the Maximum Rate,
Beneficiary hereby elects to determine the applicable rate ceiling by
using the weekly ceiling from time to time in effect, subject to
Beneficiary's right subsequently to change such method in accordance with
applicable law, as the same may be amended or modified from time to time.
7.13 DEFICIENCY.
(a) In the event an interest in any of the Subject Property and
Collateral is foreclosed upon pursuant to a judicial or nonjudicial
foreclosure sale, Grantor agrees as follows. Notwithstanding the
provisions of Sections 51.003, 51.004, and 51.005 of the Texas
Property Code (as the same may be amended from time to time), and to
the extent permitted by law, Grantor agrees that Beneficiary shall
be entitled to seek a deficiency judgment from Grantor and any other
party obligated on the Note equal to the difference between the
amount owing on the Note and the amount for which the Subject
Property and Collateral was sold pursuant to judicial or nonjudicial
foreclosure sale. Grantor expressly recognizes that this section
constitutes a waiver of the above-cited provisions of the Texas
Property Code which would otherwise permit Grantor and other persons
against whom recovery of deficiencies is sought or any guarantor
independently (even absent the initiation of deficiency proceedings
against them) to present competent evidence of the fair market value
of the Subject Property and Collateral as of the date of the
foreclosure sale and offset against any deficiency the amount by
which the foreclosure sale price is determined to be less than such
fair market value. Grantor further recognizes and agrees that this
waiver creates an irrebuttable presumption that the foreclosure sale
price is equal to the fair market value of the Subject Property and
Collateral for purposes of calculating deficiencies owed by Grantor,
any guarantor, and others against whom recovery of a deficiency is
sought.
(b) Alternatively, in the event the waiver provided for in subsection
(a) above is determined by a court of competent jurisdiction to be
unenforceable, the following shall be the basis for the finder of
fact's determination of the fair market value of the Subject
Property and Collateral as of the date of the foreclosure sale in
proceedings governed by Sections 51.003, 51.004 and 51.005 of the
Texas Property Code (as amended from time to time): (i) the Subject
Property and Collateral shall be valued in an "as is" condition as
of the date of the foreclosure sale, without any assumption or
expectation that the Subject Property and Collateral will be
repaired or improved in any manner before a resale of the Subject
Property and Collateral after foreclosure; (ii) the valuation shall
be based upon an assumption that the foreclosure purchaser desires a
resale of the Subject Property and Collateral for cash promptly (but
no later than twelve (12) months) following the foreclosure sale;
(iii) all reasonable closing costs customarily borne by the seller
in commercial real estate transactions should be deducted from the
gross fair market value of the Subject Property and Collateral,
including, without limitation, brokerage commissions, title
insurance, a survey of the Subject Property, tax prorations,
attorneys' fees, and marketing costs; (iv) the gross fair market
value of the Subject Property and Collateral shall be further
discounted to account for any estimated holding costs associated
with maintaining the Subject Property and Collateral pending sale,
including, without limitation, utilities expenses, property
management fees, taxes and assessments (to the extent not accounted
for in (iii) above), and other maintenance, operational and
ownership expenses; and (v) any expert opinion testimony given or
considered in connection with a determination of the fair market
value of the Subject Property and Collateral must be given by
persons having at least five (5) years experience in appraising
property similar to the Subject Property and Collateral and who have
conducted and prepared a complete written appraisal of the Subject
Property and Collateral taking into consideration the factors set
forth above.
DEED OF TRUST - Page 21
7.14 ENTIRE AGREEMENT; AMENDMENT. THIS DEED OF TRUST AND THE OTHER LOAN
DOCUMENTS EMBODY THE FINAL, ENTIRE AGREEMENT AMONG THE PARTIES HERETO AND
SUPERSEDE ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS, AND
UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THE SUBJECT MATTER
HEREOF AND THEREOF AND MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF
THE PARTIES HERETO. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES HERETO.
The provisions of this Deed of Trust and the Loan Documents may be amended
or waived only by an instrument in writing signed by the Grantor and
Beneficiary.
DEED OF TRUST - Page 22
IN WITNESS WHEREOF, Grantor has executed this Deed of Trust as of the day
and year set forth above.
"GRANTOR"
INTERVOICE, INC.,
a Texas corporation
By:
----------------------------------------
Xxxxx X. Xxxxxx, Executive Vice President
and Chief Financial Officer
STATE OF TEXAS |
|
COUNTY OF |
-----------------
This instrument was ACKNOWLEDGED before me on June , 2004, by Xxxxx
X. Xxxxxx, the Executive Vice President and Chief Financial Officer of
INTERVOICE, INC., a Texas corporation, on behalf of said corporation.
[S E A L]
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Notary Public - State of Texas
My Commission Expires:
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Printed Name of Notary Public
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DEED OF TRUST - Page S-1
EXHIBIT A
DESCRIPTION OF SUBJECT PROPERTY
SCHEDULE 1 - Solo Page
