EXHIBIT 10.14.10
RECORD AND RETURN TO:
Xxxx X. Xxxxxx, Esq.
Xxxxx, Xxxxxxxx & Xxxxxxx, LLP
Suite 3100, Promenade II
0000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000-0000
DEED TO SECURE DEBT, SECURITY AGREEMENT
AND ASSIGNMENT OF LEASES AND RENTS
THIS DEED TO SECURE DEBT, SECURITY AGREEMENT AND ASSIGNMENT OF
LEASES AND RENTS (this "Security Deed") is made and delivered as of the 3rd
day of May, 2000, by XXXXXXX PROPERTIES RESIDENTIAL, L.P. ("Borrower"), a
Georgia limited partnership, having a mailing address of 0000 Xxxxxxx Xxxx,
Xxxxx 000, Xxxxxxx, Xxxxxxx 00000, to and for the benefit of FIRST UNION
NATIONAL BANK ("Lender"), a national banking association, having as its address
000 Xxxxxxxxx Xxxxxx, X.X., Xxxxx Xxxxx, Xxxxxxx, Xxxxxxx 00000, Attn: Real
Estate Portfolio Management, Mail Code 9068;
W I T N E S S E T H:
ARTICLE I. DEFINED TERMS
For purposes hereof, the following terms shall have the following meanings:
1.1 "Borrower": The above-defined Borrower, whether one or
more, and its approved successors, successors-in-title and assigns.
1.2 "Construction Contracts": Any and all contracts and
agreements, written or oral, between Borrower and any other party, and between
parties other than Borrower, in any way relating to the construction of the
Improvements (hereinafter defined) or the supplying of material, labor, supplies
or other services therefor and any and all permits, bonds, surveys, licenses or
other governmental approvals in any way related to the construction of the
Improvements.
1.3 "Environmental Laws": Any and all federal, state and local
environmental, health or safety laws, standards, ordinances, regulations and
rules of common law, including, but not limited to, the Comprehensive
Environmental Response, Compensation and Liability Act, as amended (42 USC ss.
9601, et seq.) ("CERCLA"), the Superfund Amendments and Reauthorization Act, as
amended (42 USC ss. 9601, et seq.), the Emergency Planning and Community
Right-to-Know
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Act, as amended (42 USC ss. 11001, et seq.), the Resource Conservation and
Recovery Act, as amended (42 USC ss. 6901, et seq.) ("RCRA"), the Clean Air Act,
as amended (42 USC ss. 7401, et seq.) ("Clean Air Act"), the Toxic Substances
Control Act, as amended (15 USC ss. 2601, et seq.) ("Substances Act"), the
Federal Water Pollution Control Act, as amended (33 USC ss. 1251, et seq.), the
Hazardous Materials Transportation Act, as amended (49 USC ss. 1802, et seq.)
("Transportation Act") and the Clean Water Act, as amended (33 USC ss. 466, et
seq.) ("Clean Water Act").
1.4 "Event of Default": Any failure, happening or occurrence
described in Article V hereinbelow.
1.5 "Fixtures": All materials, supplies, equipment, apparatus
and other items now owned or hereafter acquired by Borrower and now or hereafter
attached to, installed in or used in connection with (temporarily or
permanently) any of the Improvements or the Property (hereinafter defined),
including, but not limited to, any and all building and construction materials
and supplies, furniture, furnishings, apparatus, machinery, equipment, motors,
elevators, fittings, radiators, ranges, refrigerators, awnings, shades, screens,
blinds, carpeting, office equipment and other furnishings, and all plumbing,
heating, lighting, cooking, laundry, ventilating, refrigerating, incinerating,
air conditioning and sprinkler equipment, telephone systems, televisions and
televisions systems, computer systems, and fixtures and appurtenances thereto,
together with all accessions, replacements, betterments and substitutions for
any of the foregoing and the proceeds thereof.
1.6 "General Partner": Xxxxxxx Realty Investors, Inc.
1.7 "Governmental Authorities": Any and all courts, boards,
agencies, commissions, offices, officers, officials or authorities of any nature
whatsoever (including, without limitation, health and environmental) for any
governmental unit (federal, state or local).
1.8 Intentionally Omitted
1.9 "Hazardous Materials": Any hazardous substances, hazardous
wastes, regulated substances, toxic substances, or hazardous air pollutants,
including, without limitation, asbestos, PCBs, oil, petroleum products and
by-products, substances defined or listed as "hazardous substances" or "toxic
substances" or otherwise identified in or pursuant to CERCLA, hazardous
materials identified in or pursuant to the Transportation Act, hazardous wastes
identified in or pursuant to RCRA, any chemical substance or mixture regulated
under the Substances Act, any "toxic pollutant" under the Clean Water Act, any
hazardous air pollutant under the Clean Air Act, and any hazardous or toxic
substance or pollutant regulated under any other applicable federal, state or
local Environmental Laws.
1.10 "Impositions": (i) All real estate and personal property
taxes, charges, assessments, excises and levies and any interest, costs or
penalties with respect thereto, general and special, ordinary and extraordinary,
foreseen and unforeseen, of any kind and nature whatsoever, which at any time
prior to or after the execution hereof may be assessed, levied or imposed upon
the
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Mortgaged Property (hereinafter defined) or the ownership, use, occupancy or
enjoyment thereof, or any portion thereof; (ii) any charges, fees, license
payments or other sums payable for any easement, license or agreement maintained
for the benefit of the Mortgaged Property; and (iii) water, gas, sewer,
electricity, telephone and other utility charges and fees related to the
Mortgaged Property.
1.11 "Improvements": Any and all improvements, additions,
alterations, betterments or appurtenances to the Property, whether now existing
or at any time hereafter situated, placed or constructed upon the Property, or
any part thereof.
1.12 "Indebtedness": (i) The principal of, interest on and all
other amounts, payments and premiums due under or secured by the Note
(hereinafter defined), this Security Deed and any and all other documents now or
hereafter executed by Borrower or any other person or party in connection with
the loan evidenced by the Note; (ii) any and all additional sums advanced by
Lender to preserve the Mortgaged Property or its security title in and to the
Mortgaged Property, or for taxes, assessments or insurance premiums; (iii) such
additional sums, with interest thereon, as may hereafter be borrowed from
Lender, its successors or assigns, by the then record owner of the Mortgaged
Property, when evidenced by a promissory note which, by its terms, is secured
hereby (it being contemplated that such future indebtedness may be incurred);
and (iv) such other and further indebtedness as may now be, or from time to time
hereafter shall become, owing to Lender by Borrower, or any one or more of them
either jointly or severally, including without limitation, any and all
obligations, liabilities, debts, indebtedness, etc. which may now or hereafter
be owing by Borrower to Lender or to any "affiliate" (as that term is
hereinafter defined) of Lender under any rate swap, zero cost collar, or any
other derivative contract or product ("Swap Agreement") entered into by and
between Borrower and Lender or Borrower and any affiliate of Lender, including
without limitation, that certain ISDA Master Agreement, dated March 23, 2000,
between Borrower and Lender. For purposes of this section (iv), "affiliate"
shall mean, as to Lender, any person or entity which, directly or indirectly,
owns or controls, on an aggregate basis, including all beneficial ownership and
ownership or control as a trustee, guardian or other fiduciary, at least five
percent (5%) of the outstanding shares of capital stock having ordinary voting
power to elect a majority of the board of directors or other governing body
(irrespective of whether, at the time, stock of any other class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) of such person or entity or at least five percent
(5%) of the partnership or other ownership interest of such person or entity; or
which controls, is controlled by or is under common control with such person or
entity; provided, however, that in no event shall Borrower and Lender be deemed
or regarded as affiliates of each other. For the purposes of this definition,
"control" means the possession, directly or indirectly, of the power to direct
or cause the direction of management and policies, whether through the ownership
of voting securities, by contract or otherwise.
1.13 "Leases": Any and all leases, subleases, licenses,
concessions or other agreements (written or oral, now or hereafter in effect)
which grant a possessory interest in and to, or the right to use, all or any
part of the Mortgaged Property, together with all security and other deposits
made in connection therewith.
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1.14 "Legal Requirements": (i) Any and all judicial decisions,
statutes, rulings, rules, regulations, permits, certificates or ordinances of
any Governmental Authority in any way applicable to Borrower or applicable to,
affecting or impacting in any way the Mortgaged Property, including, without
limiting the generality of the foregoing, the ownership, use, occupancy,
possession, operation, maintenance, alteration, repair or reconstruction
thereof; (ii) any and all covenants, conditions and restrictions contained in
any deed or other form of conveyance or in any other instrument of any nature
that relate in any way or are applicable to the Mortgaged Property or the
ownership, use or occupancy thereof; (iii) Borrower's presently or subsequently
effective bylaws and articles of incorporation, partnership agreement, joint
venture agreement, trust agreement or other form of business association
agreement; (iv) any and all Leases; and (v) any and all other contracts (written
or oral) of any nature that relate in any way to the Mortgaged Property and to
which Borrower may be bound, including, without limiting the generality of the
foregoing, any lease or other contract pursuant to which Borrower is granted a
possessory interest in the Property.
1.15 "Lender": The above-defined Lender, and any subsequent
holder or holders, from time to time, of the Note.
1.16 "Loan Documents": This Security Deed, the Note, that
certain Construction Loan Agreement of even date herewith between Borrower and
Lender (the "Loan Agreement), that certain Environmental Indemnity Agreement of
even date herewith from Borrower to Lender, any and all UCC Financing Statements
from Borrower to Lender, and any and all other documents now or hereafter
executed by Borrower or any other person or party to evidence or secure the
payment of the Indebtedness or the performance and discharge of the Obligations.
1.17 "Mortgaged Property": The Property, Improvements,
Fixtures, Personalty (hereinafter defined) together with:
(a) all rights, privileges, tenements, hereditaments,
royalties, minerals, oil and gas rights, rights-of-way, easements, appendages
and appurtenances in anywise appertaining thereto, and all right, title and
interest, if any, of Borrower, in and to any streets, ways, alleys, strips or
gores of land adjoining the Property or any part thereof; and
(b) all betterments, improvements, additions, alterations,
appurtenances, substitutions, replacements and revisions thereof and thereto,
and all reversions and remainders therein; and
(c) all of Borrower's right, title and interest in and to any
awards, remunerations, reimbursements, settlements or compensation heretofore
made or hereafter to be made by any Governmental Authority pertaining to the
Property, Improvements, Fixtures or Personalty including, but not limited to,
those for any vacation of, or change of grade in, any streets affecting the
Property or the Improvements and those for municipal utility district or other
utility costs incurred or deposits made in connection with the Property; and
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(d) all of Borrower's right, title and interest in and to any
proceeds of insurance required or maintained pursuant to the terms of Paragraph
3.19 hereof; and
(e) subject to the provisions of Paragraph 8.3 hereof, all of
the Leases and Rents; and
(f) the Construction Contracts and Plans; and
(g) any and all other security and collateral, of any nature
whatsoever, now or hereafter given for the repayment of the Indebtedness or the
performance and discharge of the Obligations.
As used in this Security Deed, the term "Mortgaged Property" shall be expressly
defined as meaning all or, where the context permits or requires, any portion of
the above, and all or, where the context permits or requires, any interest
therein.
1.18 "Note": The promissory note of even date herewith,
executed by Borrower payable to the order of Lender, in the principal amount of
TWENTY-TWO MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($22,500,000.00),
with final payment due on May 1, 2005, and any and all renewals, reinstatements,
extensions, enlargements or rearrangements thereof, amendments thereto, or any
promissory note or notes given therefor.
1.19 "Obligations": Any and all of the covenants, conditions,
warranties, representations and other obligations (other than to repay the
Indebtedness) made or undertaken by Borrower to Lender, as set forth in the Loan
Documents, the Leases and all other documents now or hereafter executed by
Borrower in connection with the loan evidenced by the Note and in any deed,
lease, sublease or other form of conveyance or any other agreement pursuant to
which Borrower is granted a possessory interest in the Property.
1.20 "Permitted Encumbrances": Those items listed on Exhibit
"B" attached hereto.
1.21 "Personalty": All of the right, title and interest of
Borrower in and to all furniture, furnishings, equipment, machinery, goods,
general intangibles, money, insurance proceeds, accounts, contract rights,
trademarks, trade names, inventory, all refundable, returnable or reimbursable
fees, deposits or other funds or evidences of credit or indebtedness deposited
by or on behalf of Borrower with any governmental agencies, boards, corporations
or providers of utility services, public or private, including specifically, but
without limitation, all refundable, returnable or reimbursable tap fees, utility
deposits, commitment fees and development costs, and all other personal property
(other than the Fixtures) of any kind or character as defined in and subject to
the provisions of the Uniform Commercial Code of Georgia, which are now or
hereafter located or to be located upon, within or about the Mortgaged Property
or which are or may be used in or related to
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the planning, development, financing or operation of the Mortgaged Property,
together with all accessories, replacements and substitutions thereto or
therefor and the proceeds thereof.
1.22 "Plans": Any and all plans, specifications, shop
drawings, and other technical descriptions prepared for construction of the
Improvements, and all amendments and modifications thereof.
1.23 "Property": The real estate or interest therein described
in Exhibit "A" attached hereto and incorporated herein by this reference, and
all rights, titles and interests appurtenant thereto.
1.24 "Rents": The rents, income, receipts, revenues, issues
and profits now due or which may become due or to which Borrower is now or
hereafter may become entitled or which Borrower may demand or claim, arising or
issuing from or out of the Leases, or from or out of the Mortgaged Property or
any part thereof, including, without limiting the generality of the foregoing,
minimum rents, additional rents, percentage rents, parking maintenance charges
or fees, tax and insurance contributions, proceeds of sale of electricity, gas,
chilled and heated water and other utilities and services, deficiency rents,
security deposits and other liquidated damages following default, premiums
payable by any Tenant upon the exercise of a cancellation privilege provided for
in any Lease and all proceeds payable under any policy of insurance covering
loss of rents resulting from untenantability caused by destruction or damage to
the Mortgaged Property, together with any and all rights and claims of any kind
which Borrower may have against any Tenant under any Lease or against any
subtenants or occupants of the Mortgaged Property.
1.25 "Tenant": The tenant or lessee under any Lease.
ARTICLE II. GRANT AND CONVEYANCE
2.1 Grant and Conveyance. For and in consideration of the sum of Ten
and No/100 Dollars ($10.00) and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Borrower does hereby
GRANT, BARGAIN, SELL, CONVEY, ASSIGN, TRANSFER, PLEDGE and SET OVER unto Lender
the Mortgaged Property, subject, however, to the Permitted Encumbrances, TO HAVE
AND TO HOLD the Mortgaged Property and all parts, rights, members and
appurtenances thereof, to the use, benefit and behoof of Lender and the
successors and assigns of Lender, IN FEE SIMPLE forever; and Borrower warrants
and covenants that Borrower is lawfully seized and possessed of the Mortgaged
Property as aforesaid, and has good right to convey the same subject only to the
Permitted Encumbrances, and that Borrower does warrant and shall forever defend
the title thereto against the claims of all persons whomsoever, except as to the
Permitted Encumbrances.
2.2 Security Deed. This Security Deed is intended to operate and is to
be construed as a deed passing the title to the Mortgaged Property to Lender and
is made under those provisions of the existing laws of the State of Georgia
relating to deeds to secure debt, and not as a mortgage, and
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is given to secure the Indebtedness and Obligations, and any and all renewals,
modifications, consolidations, replacements and extensions thereof.
2.3 Cancellation. Should the Indebtedness be paid according to the
tenor and effect thereof when the same shall become due and payable, and should
Borrower perform all Obligations in a timely manner, then this Security Deed
shall be canceled and surrendered.
2.4 Revolving Loan Account. If this Security Deed secures a "revolving
loan account" as defined in Section 44-14-3 of the Official Code of Georgia
Annotated, payment of all amounts outstanding on the Note from time to time
shall not cancel or release this Security Deed, and re-advances shall be secured
to the same extent as original obligations hereunder.
ARTICLE III. COVENANTS, WARRANTIES AND REPRESENTATIONS
Borrower hereby unconditionally covenants, warrants and represents to
Lender as follows (which covenants, warranties and representations have been and
will be relied upon by Lender in advancing funds to Borrower under the Loan
Documents, and shall be deemed to be continuing covenants, warranties and
representations made on a daily basis by Borrower):
3.1 Organization and Power. If Borrower, or any signatory who signs on
its behalf, is a corporation, general partnership, limited partnership, joint
venture, trust, or other type of business association, it (a) as the case may
be, is a corporation duly incorporated or a general partnership, limited
partnership, joint venture, trust or other type of business association duly
organized, validly existing and in good standing under the laws of the state of
its formation or existence, and has complied with all conditions prerequisite to
its doing business in the State of Georgia, and (b) has all requisite power and
all governmental certificates of authority, licenses, permits, qualifications
and documentation to own, lease and operate its properties and to carry on its
business as now being, and as proposed to be, conducted.
3.2 Validity of Loan Instruments. The execution, delivery and
performance by Borrower of the Loan Documents (a) if Borrower, or any signatory
who signs on its behalf, is a corporation, general partnership, limited
partnership, joint venture, trust or other type of business association, are
within Borrower's authority and have been duly authorized by Borrower's Board of
Directors, shareholders, partners, venturers, trustees or other necessary
parties, and all other requisite action for such authorization has been taken;
(b) have received all (if any) requisite prior governmental approval in order to
be legally binding and enforceable in accordance with the terms thereof; and (c)
will not violate, be in conflict with, result in a breach of or constitute (with
due notice or lapse of time, or both) a default under any Legal Requirement, or
result in the creation or imposition of any lien, charge or encumbrance of any
nature whatsoever upon any of Borrower's property or assets, except as
contemplated by the provisions of the Loan Documents. The Loan Documents
constitute the legal, valid and binding obligations of Borrower and others
obligated under the terms of the Loan Documents, enforceable in accordance with
their respective terms.
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3.3 Information. All information, reports, papers and data given to
Lender with respect to Borrower or others obligated under the terms of the Loan
Documents or the Mortgaged Property are, or at the time of delivery will be,
accurate, complete and correct in all material respects and do not omit any
fact, the inclusion of which is necessary to prevent the facts contained therein
from being materially misleading. Borrower has disclosed to Lender in writing
all pending or threatened litigation involving Borrower or the Mortgaged
Property.
3.4 Title to Mortgaged Property and Priority of this Instrument.
Borrower has good, marketable and indefeasible fee simple title to the Property
and Improvements, and good and marketable title to the Fixtures and Personalty,
free and clear of any liens, charges, encumbrances, security interests, claims,
easements, restrictions, options, leases (other than the Leases), covenants and
other rights, titles, interests or estates of any nature whatsoever except the
Permitted Encumbrances. This Security Deed constitutes a valid and subsisting
first priority deed to secure debt in and to the Property, Improvements and
Fixtures, a valid, subsisting first security interest in and to the Personalty,
Construction Contracts, Plans and, to the extent that the terms Leases and Rents
include items covered by Article 9 of the Uniform Commercial Code, Title 11 of
the Official Code of Ga. Xxx. (Xxxxxx 1982), Title 109A of Ga. Code Xxx.
(Xxxxxxxx 1977), in the Leases and Rents; and a valid, subsisting first priority
assignment of the Leases and Rents not covered by said Article 9, all in
accordance with the terms hereof.
3.5 Taxes and Other Payments. Borrower has filed all federal, state and
local income and other tax returns required to have been filed by them and have
paid all taxes owed by them, and Borrower knows of no basis for any additional
assessment in respect of any such taxes, except that which may result from
increased valuation resulting from the construction of the Improvements.
Borrower has paid or will pay in full (except for such retainages as may be
permitted or required by any Legal Requirement to be withheld by Borrower
pending completion of the Improvements and the Xxxxxxxx xxxx referenced in
paragraphs 6.36 and 6.37 of the Loan Agreement) all sums owing or claimed for
labor, material, supplies, personal property (whether or not a Fixture
hereunder) and services of every kind and character used, furnished or installed
in or on the Mortgaged Property and no lien for same exists or will be permitted
to be created.
3.6 Hazardous Materials. (a) Borrower has conducted all appropriate
inquiry and investigation into the presence of Hazardous Materials on the
Mortgaged Property and the compliance by the Mortgaged Property with all
Environmental Laws. The Mortgaged Property is, and at all times hereafter will
continue to be, in full compliance with all Environmental Laws. As of the date
of this Security Deed, the Mortgaged Property has not been used to treat, store
or dispose of any Hazardous Materials, and no such Hazardous Materials
(including without limitation, any materials containing asbestos), are located
on, in or under the Mortgaged Property or used or emitted in connection
therewith. Borrower has obtained and shall maintain all licenses, permits and
approvals required with respect to Hazardous Materials, and is in full
compliance with all of the terms, conditions and requirements of such licenses,
permits and approvals.
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(b) To the best of Borrower's knowledge and belief, no portion
of the Mortgaged Property is a wetland.
(c) Borrower shall promptly notify Lender of any change in the
nature or extent of any (i) Hazardous Materials, maintained on, in or under the
Mortgaged Property or used or emitted in connection therewith and (ii) wetlands
located on the Mortgaged Property. Borrower also has notified and shall notify
Lender of Borrower's receipt of any citations, orders, notices, consent
agreements, lawsuits, claims, or similar communication from a government agency
or third party alleging a violation of any Environmental Laws (including
allegations of a violation of the common law).
(d) Borrower shall indemnify and hold Lender harmless from and
against any and all damages, penalties, fines, claims, liens, suits,
liabilities, costs (including clean-up costs), judgments and expenses (including
attorneys', consultants' or experts' fees and expenses) of every kind and nature
suffered by or asserted against Lender as a direct or indirect result of any
warranty, representation, or portion thereof, made by Borrower in this Paragraph
3.6, being false or untrue in any respect or as a result of any requirement
under any Environmental Law, which requires the elimination, treatment, or
removal of any Hazardous Materials. Upon demand by Lender, Borrower shall
diligently defend any claim arising under any Environmental Laws or relating to
Hazardous Materials which affects the Property or is made or commenced against
Lender, whether alone or together with Borrower or any other person, all at
Borrower's own cost and expense and by counsel to be approved by Lender in the
exercise of its reasonable judgment. In the alternative, at any time Lender may
elect to conduct its own defense through counsel selected by Lender and at the
cost and expense of Borrower.
(e) Lender shall have the right at any time prior to full
payment and satisfaction of the Note that Lender has a good faith belief that
Hazardous Materials are present on the Premises or that the Premises are not in
full compliance with all Environmental Laws to arrange for or conduct
environmental inspections of the Mortgaged Property (including, but not limited
to, sampling of materials for laboratory analysis). The cost of such inspections
shall be borne as agreed between Borrower and Lender, except that the cost of
any such inspections conducted in contemplation of foreclosure or pursuant to
Paragraph 9.7 hereof shall be the obligation of Borrower.
(f) Borrower's obligations under this Section 3.6 to Lender
shall not be limited to any extent by the terms of the Note, and, as to any act
or occurrence prior to payment in full and satisfaction of the Note which gives
rise to liability hereunder, shall continue, survive and remain in full force
and effect notwithstanding payment in full and satisfaction of the Note and this
Security Deed or foreclosure under this Security Deed, or delivery of a deed in
lieu of foreclosure.
3.7 No Default. Borrower is not in default in the performance,
observance or fulfillment of any of the obligations, covenants or conditions
contained in any agreement or instrument to which it is a party.
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3.8 ERISA. Borrower does not have a defined benefit pension
plan under the Employee Retirement Income Security Act of 1974, as amended from
time to time, the unfunded liabilities of which upon termination could be held
to be a liability of Borrower by the Pension Benefit Guaranty Corporation.
3.9 Intentionally omitted.
3.10 Leases. (a) Borrower has good title to the Leases and
Rents and all requisite right, power and authority to assign the Leases and
Rents, and no other person, firm or corporation has any right, title or interest
therein;
(b) Borrower has duly and punctually performed, all and
singular, the terms, covenants, conditions and warranties of the Leases on
Borrower's part to be kept, observed and performed; and the Tenants thereunder
are not in material default of any of the terms or provisions of the respective
Leases;
(c) As of the date hereof the Leases now in existence are
valid and unmodified, except as indicated herein, and are in full force and
effect; Borrower has not previously sold, assigned, transferred, mortgaged or
pledged the Leases or the Rents, whether now due or hereafter to become due; the
Rents now due, or to become due, for any periods subsequent to the date hereof
have not been collected more than one (1) month in advance, and payment thereof
has not been anticipated more than one (1) month in advance, waived or released,
discounted, setoff or otherwise discharged or compromised; and Borrower has not
received any funds or deposits from any Tenant for which credit has not already
been made on account of accrued Rents.
(d) The form lease to be used by Borrower shall be approved by
Lender in writing and such form shall be used for all Leases. No material
modification of the form may be made to the form lease without Lender's prior
written approval.
3.11 Use. Borrower shall use the Mortgaged Property for
business purposes only. Borrower shall not use, maintain, operate or occupy, or
allow the use, maintenance, operation or occupancy of, the Mortgaged Property in
any manner or for any purpose which (a) violates any Legal Requirement, (b) may
be dangerous unless safeguarded as required by law, (c) constitutes a public or
private nuisance, or (d) makes void, voidable or cancelable, or increases the
premium of, any insurance then in force with respect thereto.
3.12 Alterations. Borrower shall not commit or permit any
waste of the Mortgaged Property and shall not (subject to the provisions of
Paragraphs 5.6 and 5.8 hereinbelow), without the prior written consent of
Lender, which consent shall not be unreasonably withheld, delayed or
conditioned, make or permit to be made any alterations or additions to the
Mortgaged Property of a material nature.
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3.13 Payment and Performance. Borrower shall pay the
Indebtedness, as and when called for in the Loan Documents, and on or before the
due dates thereof, and shall perform all of the Obligations in full and on or
before the dates same are to be performed.
3.14 Existence. Borrower shall preserve and keep in full force
and effect its existence, rights, franchises and trade names.
3.15 Compliance with Legal Requirements. Borrower shall
promptly and faithfully comply with, conform to and obey all present and future
Legal Requirements including, without limitation, the Americans with
Disabilities Act of 1990, as amended (42 USC ss. 12101, et seq.), the Federal
Architectural Barriers Act, as amended (42 USC ss. 4151, et seq.), the Fair
Housing Amendments Act of 1988, as amended (42 USC ss. 3601, et seq.) and the
Rehabilitation Act of 1973, as amended (29 USC ss. 794), whether or not same
shall necessitate structural changes in, improvements to, or interfere with the
use or enjoyment of the Mortgaged Property.
3.16 Prior Security Deed Status. Borrower shall protect the
prior security deed status of this Security Deed and the other Loan Documents
and shall not place, or permit to be placed, or otherwise convey, mortgage,
hypothecate or encumber the Mortgaged Property with, any other lien or security
deed or interest of any nature whatsoever, regardless of whether same is
allegedly or expressly inferior to the title created by this Security Deed. If
any such claim, lien or security interest is asserted against the Mortgaged
Property, Borrower shall promptly, and at its own cost and expense, (a) give
Lender verbal notice thereof immediately, together with written notice within
five (5) days from the date such claim, lien or security interest is asserted;
and (b) take such action so as to cause same to be released or bonded to
Lender's satisfaction. Such notice shall specify who is asserting such claim,
lien or security interest and shall detail the origin and nature of the
underlying facts giving rise to such asserted claim, lien or security interest.
3.17 Payment of Impositions. (a) Borrower shall duly pay and
discharge, or cause to be paid and discharged, the Impositions not later than
the date the same shall become delinquent; provided, however, that Borrower may,
if, to the extent and in the manner permitted by law, (i) pay the Impositions in
installments if such installment payment would not create or permit the filing
of a lien against the Mortgaged Property and (ii) contest the payment of any
Impositions in good faith and by appropriate proceedings on the following
conditions: (A) any such contests shall be prosecuted diligently and in a manner
not prejudicial to the rights, liens and security title of Lender, (B) Borrower
shall deposit funds with Lender or obtain a bond in form and substance and with
an issuing company satisfactory to Lender in an amount sufficient to cover any
amounts which may be owing in the event the contest may be unsuccessful
(Borrower shall make such deposit or obtain such bond, as the case may be,
within five (5) days after demand therefor and, if made by payment of funds to
Lender, the amount so deposited shall be disbursed in accordance with the
resolution of the contest either to Borrower or the adverse claimant), (C) no
contest may be conducted and no payment may be delayed beyond the date on which
the Mortgaged Property could be sold for nonpayment and (D) Lender may pay over
to the taxing authority entitled thereto any or all of the
11
funds at any time when, in the opinion of Lender's counsel, the entitlement of
such authority to such funds is established.
(b) In the event of the passage of any federal, state or local
law, order, rule or regulation, subsequent to the date hereof, in any manner
changing or modifying the laws now in force governing the taxation of deeds to
secure debt, or security agreements, or assignments of leases or debts secured
thereby or the manner of collecting such taxes so as to adversely affect Lender,
Borrower shall pay any such tax on or before the due date thereof. If Borrower
fails to make such prompt payment or if, in the opinion of Lender, any such
state, federal, municipal, or other governmental law, order, rule or regulation
prohibits Borrower from making such payment or would penalize Lender if Borrower
makes such payment or if, in the opinion of Lender, the making of such payment
might result in the imposition of interest beyond the maximum amount permitted
by applicable law, then the entire balance of the Indebtedness shall, at the
option of Lender, become immediately due and payable.
3.18 Repair. Borrower shall keep the Mortgaged Property in
first class order and condition and shall make all repairs, replacements,
renewals, additions, betterments, improvements and alterations thereof and
thereto, interior and exterior, structural and nonstructural, ordinary and
extraordinary, foreseen and unforeseen, which are necessary or reasonably
appropriate to keep same in such order and condition.
3.19 Insurance. (a) Types of Insurance. Borrower shall procure
for, deliver to, and maintain for the benefit of Lender during the term of this
Security Deed original paid up insurance policies or certified copies of paid up
insurance policies (or, if there is blanket coverage, Lender shall require an
underlier policy with the Mortgaged Property identified and specifically
allocated amounts shown) in such amounts, form and substance, and with such
expiration dates, as are acceptable to Lender, and containing non-contributory
standard mortgagee clauses (naming "First Union National Bank, its successors
and/or assigns" as first mortgagee), their equivalent, or a satisfactory
mortgagee loss payable endorsement in favor of Lender, and being addressed to
First Union National Bank, Attention: Insurance Group, X.X. Xxx 00000, XX0000,
Xxxxxxxxxxxx, Xxxxxxx 00000, providing the following types of insurance on the
Mortgaged Property:
(i) Non-reporting form "all risk" Builder's Risk Insurance
(including hazard and material stockpile clauses), without
co-insurance, in an amount equal to at least 100% of the replacement
cost of the Improvements. The policy term must concur with the
applicable construction period. In the event Lender provides any term
financing beyond the construction period, the policy must then be
converted to a Standard Fire Insurance Policy with Extended Coverage
Endorsement;
(ii) Standard Fire Insurance with Extended Coverage
Endorsement including Vandalism and malicious Mischief, without
co-insurance, in an amount equal to at least 100% of the replacement
cost of the Improvements;
(iii) Coverage for the peril of Sprinkler Leakage;
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(iv) Boiler and Machinery Insurance to cover the sudden and
accidental breakdown of specific types of equipment as required by
Lender;
(v) Rental Loss Insurance and Business Interruption Insurance
in an amount equal to the greater of (A) an amount sufficient to cover
debt service, real estate taxes, and insurance premiums for a period of
at least twelve (12) months, or (B) the rents and other amounts due
under all Leases for a period of at least twelve (12) months;
(vi) If any Improvements are or will be located in an area
identified by the U.S. Department of Housing and Urban Development as
an area having "special flood hazards", flood insurance in an amount
equal to the lesser of the maximum principal amount of the Note or the
maximum limit of coverage available under the National Flood Insurance
Act of 1968, the Flood Disaster Protection Act of 1973, and the Housing
and Community Development Acts of 1974 and 1977, all as amended;
(vii) Single limit comprehensive general liability insurance
in an amount satisfactory to Lender against claims and liability for
bodily injury or property damage to persons or property occurring on
the Mortgaged Property; and
(viii) Such other insurance on the Mortgaged Property or any
replacements or substitutions therefor and in such amounts as may from
time to time be reasonably required by Lender against other insurable
casualties which at the time are commonly insured against in the case
of premises similarly situated, due regard being given to the type of
the improvements, their construction, location, use, and occupancy, or
any replacements or substitutions therefor.
(b) Insurance Companies, Form of Policies. All insurance
policies maintained pursuant to this Paragraph 4.9 must be issued by insurance
companies and agencies licensed by the Georgia Insurance Commissioner, having a
rating of A- or better (Excellent or Superior) and Class IX or better in A.M.
Best's Insurance Reports, and otherwise acceptable to Lender. All such policies
shall require not less than thirty (30) days' prior written notice to Lender of
any cancellation, termination, expiration or change in coverage. Without
limiting the discretion of Lender with respect to required endorsements to
insurance policies, all such policies for loss of or damage to the Mortgaged
Property shall contain a standard mortgagee clause (without contribution) naming
Lender as mortgagee with loss proceeds payable to Lender notwithstanding (i) any
act, failure to act or negligence of or violation of any warranty, declaration
or condition contained in any such policy by any named insured; (ii) the
occupation or use of the Mortgaged Property for purposes more hazardous than
permitted by the terms of any such policy; (iii) any foreclosure or other action
by Lender under the Loan Documents; or (iv) any change in title to or ownership
of the Mortgaged Property or any portion thereof, such proceeds to be held for
application as provided in the Loan Documents.
13
(c) Proof of Insurance. At least thirty (30) days prior to the
expiration date of each policy maintained pursuant to this Paragraph 3.19,
Borrower shall deliver to Lender a renewal or replacement thereof satisfactory
to Lender. Borrower shall deliver to Lender receipts evidencing the payment for
all such insurance policies and renewals or replacements. The delivery of any
insurance policies hereunder shall constitute a collateral assignment of all
unearned premiums as further security hereunder. In the event of foreclosure of
this Security Deed or any other transfer of title to the Mortgaged Property in
extinguishment of the Indebtedness, all right, title, and interest of Borrower
in and to all insurance policies then in force with respect to the Mortgaged
Property shall pass to the purchaser or Lender.
(d) Borrower's Statement of Insurance Carried. Borrower shall
furnish to Lender on or before thirty (30) days after the close of each of
Borrower's fiscal year, a statement certified by Borrower or a duly authorized
officer of Borrower of the amounts of insurance maintained in compliance with
this Paragraph 3.19, of the risks covered by such insurance, and of the
insurance company or companies which carry such insurance.
(e) Payment of Proceeds to Lender ; Minor Loss. Lender is
hereby authorized and empowered, at its option, to adjust or compromise any loss
under any insurance policies maintained pursuant to this Paragraph 3.19 and to
collect and receive the proceeds from any such policy or policies; provided
however, in the event of a "Minor Loss" (being defined as a loss equal to or
less than $25,000.00, if the loan secured hereby is $10,000,000.00 or less, or a
loss equal to or less than $50,000.00, if the loan secured hereby is more than
$10,000,000.00), Borrower shall give Lender written notice of such loss but
shall retain all rights to adjust and compromise such loss with Borrower's
insurance company, to collect and receive the proceeds with respect thereto, and
to apply the same to the restoration of the Mortgaged Property. Borrower hereby
authorizes and directs each insurance company to make payment for all losses,
excepting only Minor Losses, directly to Lender. Except in the case of a minor
Loss, in the event any insurance company fails to disburse directly and solely
to Lender but disburses instead either solely to Borrower or to Borrower and
Lender jointly, Borrower agrees immediately to endorse and transfer such
proceeds to Lender. Upon the failure of Borrower to endorse and transfer such
proceeds as aforesaid, Lender may execute such endorsements or transfers for and
in the name of Borrower, and Borrower hereby irrevocably appoints Lender as
Borrower's agent and attorney-in-fact to do so, such appointment being coupled
with an interest and being irrevocable.
(f) Application of Proceeds. In the case of any loss which is
not a Minor Loss, after deducting from said insurance proceeds all of its
expenses incurred in the collection and administration of such sums, including
reasonable attorneys' fees actually incurred, Lender may apply the net proceeds
or any part thereof, at its option:
(i) to the payment of the Indebtedness, whether or
not due and in whatever order Lender elects;
(ii) to the repair or restoration of the Mortgaged
Property; or
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(iii) for any other purposes or objects for which
Lender is entitled to advance funds under the Loan Documents;
all without affecting the security title of this Security Deed, and any balance
of such moneys then remaining shall be paid to Borrower.
3.20 Restoration Following Casualty. If any act or occurrence
of any kind or nature, ordinary or extraordinary, foreseen or unforeseen
(including any casualty for which insurance was not obtained or obtainable),
shall result in damage to, or loss or destruction of, the Mortgaged Property,
Borrower shall give notice thereof to Lender immediately and, if so instructed
by Lender and provided that Lender elects to apply the insurance proceeds (if
any) to the restoration, repair or replacement of the Mortgaged Property, shall
promptly, at Borrower's sole cost and expense and regardless of whether the
insurance proceeds (if any) shall be sufficient for the purpose, commence and
continue diligently to completion to restore, repair, replace and rebuild the
Mortgaged Property in accordance with the requirements of Lender and all Legal
Requirements as nearly as possible to its value, condition and character
immediately prior to such damage, loss or destruction.
3.21 Disbursement of Proceeds for Repairs. If the proceeds of
the insurance described in Paragraph 3.19(f) hereinabove are to be used for
restoration, repair or replacement (hereinafter referred to as the "Work") of
the Mortgaged Property, such proceeds shall, in the case of a Minor Loss, be
paid directly to Borrower, and in all other cases be paid to Lender to be paid
out by Lender from time to time to Borrower (or, at the option of Lender,
jointly to Borrower and the persons furnishing labor and/or material incident to
the Work or directly to such persons) as the Work progresses, substantially in
accordance with the disbursement procedures under the Loan Agreement as if such
proceeds were loan proceeds subject to the following conditions:
(a) Prior to the commencement thereof (other than Work to be
performed on an emergency basis to protect the Mortgaged Property or
prevent interference therewith),
(i) Borrower shall retain, at Borrower's expense, an
architect or engineer, approved by Lender, who shall supervise
the Work;
(ii) Borrower shall have prepared, submitted to
Lender and secured Lender's written approval of the plans and
specifications for such Work; and
(iii) Borrower shall have obtained and submitted to
Lender all licenses and permits necessary to complete the
Work;
(b) Borrower shall submit requests for payment no more often
than once per month. Each request for payment by Borrower shall be made
on ten (10) days' prior written notice to Lender and shall be
accompanied by a certificate to be executed by the architect or
engineer supervising the Work (if one is required pursuant to Paragraph
3.21(a)
15
hereinabove), otherwise by Borrower or an executive officer of
Borrower, stating, among such other matters as may be reasonably
required by Lender, that:
(i) all of the Work completed has been done in
compliance with the approved plans and specifications
therefor;
(ii) the sum requested is justly required to
reimburse Borrower for payments by Borrower to, or is justly
due to, the contractor, subcontractors, materialmen, laborers,
engineers, architects or other persons rendering services or
materials for the Work (giving a brief description of such
services and materials);
(iii) when added to all sums previously paid out
Borrower, in connection with the Work, the sum requested does
not exceed the value of the Work done to the date of such
certificate; and
(iv) the balance of the insurance proceeds and other
funds deposited by Borrower with Lender in connection with the
Work will be sufficient to pay for the Work in full (giving,
in such reasonable detail as the Lender may require, an
estimate of the cost of completion of the Work);
(c) Each request shall be accompanied by waivers of lien,
satisfactory in form and substance to Lender, covering that part of the
Work for which payment or reimbursement is being requested, and by a
search prepared by a title company or licensed abstractor or by other
evidence satisfactory to Lender that there has not been filed with
respect to the Mortgaged Property any mechanic's lien or other lien,
affidavit or instrument asserting any lien or any lien rights with
respect to the Mortgaged Property;
(d) Each request shall be accompanied by such supporting
documentation, certificates and other instruments and materials as
Lender may require;
(e) No Event of Default shall have occurred since the hazard,
casualty or contingency giving rise to payment of the insurance
proceeds;
(f) In the case of the request for the final disbursement,
such request shall be accompanied by a copy of any Certificate of
Occupancy or other certificate required by any Legal Requirement to
render occupancy of the damaged portion of the Mortgaged Property
lawful; and
(g) if, in Lender's judgment, the amount of such insurance
proceeds will not be sufficient to complete the Work (which
determination may be made prior to or during the performance of the
Work), Borrower shall deposit with Lender, immediately upon a request
therefor, an amount of money which, when added to such insurance
proceeds, will be sufficient, in Lender's judgment, to complete the
Work.
16
If, upon completion of the Work, any portion of the insurance proceeds has not
been disbursed to Borrower (or one or more of the other aforesaid persons) in
connection therewith, Lender may, at Lender's option, disburse such balance to
Borrower or apply such balance toward the payment of the Indebtedness, whether
or not then due. Nothing herein shall be interpreted to prohibit Lender from (y)
withholding from each such disbursement ten percent (10%) (or such greater
amount, if permitted or required by any Legal Requirement) of the amount
otherwise herein provided to be disbursed, and from continuing to withhold such
sum, until the time permitted for perfecting liens against the Mortgaged
Property has expired (or such longer period of time as permitted or required by
any Legal Requirement), at which time the amount withheld shall be disbursed to
Borrower (or to Borrower and any person or persons furnishing labor or material
for the Work or directly to such persons), or (z) applying at any time the whole
or any part of such insurance proceeds to the curing of any Event of Default.
3.22 Inspection. Borrower shall permit Lender and its agents,
representatives and employees to inspect the Mortgaged Property at all
reasonable times.
3.23 Hold Harmless. Borrower shall defend, at its own cost and
expense, and hold Lender harmless from any action, proceeding or claim affecting
the Mortgaged Property or the Loan Documents, and all costs and expenses
incurred by Lender in protecting its interests hereunder in such an event
(including all court costs and attorneys' fees) shall be borne by Borrower and
secured hereby.
3.24 Books and Records. Borrower shall maintain full and
accurate books of account and other records reflecting its financial condition
and the results of its operations of the Mortgaged Property in accordance with
generally accepted accounting principles consistently applied and shall furnish,
or cause to be furnished, to Lender, the following information and reports:
(a) As to Borrower:
(i) within 120 days after the close of its fiscal
year, current audited financial statements (annual balance
sheet and a profit/loss statement) which must be certified to
First Union National Bank;
(ii) within 45 days after the close of each fiscal
quarter a copy of its current financial statements as prepared
for such reporting period by its General Partner, signed by an
authorized officer of General Partner and certified by such
officer to be true, correct and complete;
(iii) within 90 days after the close of its fiscal
year, a statement disclosing all contingent liabilities if
these are not addressed in the audited financial statement;
(iv) such interim statements as may reasonably be
required by Lender from time to time; and
17
(v) at the request of Lender, all registration
statements and reports filed by the General Partner with the
Securities and Exchange Commission, including Forms 10-K and
10-Q (or their equivalents).
(c) Borrower, at its cost and expense, shall quarterly furnish to
Lender an income and expense statement of the operation of the Mortgaged
Property within 45 days after the close of each fiscal quarter. Each statement
shall show the total minimum annual rent, total gross receipts from operations
and total expenses in detail satisfactory to the Lender. Borrower shall also
furnish such interim statements to Lender as may be reasonably required by
Lender from time to time.
(d) Borrower shall furnish to the Lender then-current signed rent rolls
or lease digests quarterly during the term of Note in a form satisfactory to
Lender, no later than 30 days after the close of each fiscal quarter, certified
by Borrower to be true, correct and complete, if the Lender requests such
information.
(e) Borrower shall advise Lender of Borrower's respective fiscal
year-end dates and shall notify Lender, in writing, of any change in such
year-end dates.
At Lender's option, the financial statements required to be delivered pursuant
to this Paragraph 3.24 shall be certified by an officer of General Partner. At
any time and from time to time, Borrower shall deliver to Lender such other
financial data as Lender shall reasonably request with respect to the ownership,
maintenance, use and operation of the Mortgaged Property, and Lender shall have
the right, at reasonable times and upon reasonable notice, to audit, examine and
make copies or extracts of Borrower's books of account and records relating to
the Mortgaged Property, all of which shall be maintained and made available to
Lender and Lender's representatives for such purpose at the address specified
herein for Borrower or at such other location as Lender may approve. Upon
Lender's request, Borrower shall also furnish Lender with convenient facilities
necessary for an audit of such statements. If Borrower is a partnership, joint
venture, trust or other type of business association, Borrower shall provide
Lender with any and all financial statements and other documents and make any
and all disclosures to Lender with respect to any of the parties comprising
Borrower as Borrower is required to provide and make, and in the manner required
to be provided and made, with respect to Borrower pursuant to this Paragraph
3.24.
3.25 Tax and Insurance Escrow. At Lender's option after any
Event of Default or Default Condition, in order to implement the provisions of
Paragraphs 3.17 and 3.19 hereinabove, Borrower shall pay to Lender monthly,
annually, or as otherwise directed by Lender, an amount ("Escrowed Sums") equal
to the sum of (a) the annual Impositions (estimated by Lender, wherever
necessary) to become due for the tax year during which such payment is so
directed and (b) the insurance premiums for the same year for those insurance
policies as are required hereunder. If Lender determines that any amounts
theretofore paid by Borrower are insufficient for the payment in full of such
Impositions and insurance premiums, Lender shall notify Borrower of the
increased amounts required to provide a sufficient fund, whereupon Borrower
shall pay to Lender within thirty (30)
18
days thereafter the additional amount as stated in Lender's notice. The Escrowed
Sums may be held by Lender in non-interest bearing accounts and may be
commingled with Lender's other funds. Upon assignment of this Security Deed,
Lender shall have the right to pay over the balance of the Escrowed Sums then in
its possession to its assignee whereupon the Lender shall then become completely
released from all liability with respect thereto. Within ninety-five (95) days
following the full payment of the Indebtedness (other than a full payment of the
Indebtedness as a consequence of a foreclosure or conveyance in lieu of
foreclosure of the liens and security title securing the Indebtedness) or at
such earlier time as Lender may elect, the balance of the Escrowed Sums in its
possession shall be paid over to Borrower and no other party shall have any
right or claim thereto. If no Event of Default shall have occurred and be
continuing hereunder, the Escrowed Sums shall, at the option of Lender, be
repaid to Borrower in sufficient time to allow Borrower to satisfy Borrower's
obligations under the Loan Documents to pay the Impositions and the required
insurance premiums or be paid directly to the Governmental Authority and the
insurance company entitled thereto. If an Event of Default shall have occurred
and be continuing hereunder, however, Lender shall have the additional option of
crediting the full amount of the Escrowed Sums against the Indebtedness.
3.26 Notice of Default. Borrower shall notify Lender of (a)
any condition that would constitute a default or Event of Default hereunder or
under any other Loan Document, (b) any litigation or proceeding that is brought
against Borrower or the Mortgaged Property and that has a stated claim of
$100,000.00 or more, and (c) any material adverse change in the business,
properties or condition (financial or otherwise) of Borrower.
3.27 Estoppel Certificate. Borrower shall, from time to time,
within ten (10) days after Lender's request, furnish Lender or any other person
or entity designated by Lender, an affidavit or certificate in a form
satisfactory to Lender which shall:
(i) indicate the unpaid principal balance and
accrued interest on the Note;
(ii) acknowledge either that Borrower is not in
default of the terms and conditions of the
Note and the Loan Documents or that a
default exists, in which case, any defaults
shall be described in detail; and
(iii) state that Borrower has no defense, right of
set-off or counterclaim to the payment of
the Indebtedness, or any part thereof, or
the performance of any obligation (or
describing any such defense, set-off, or
counterclaim).
Lender and any purchaser or assignee of the Note and Loan Documents or any
participating interest therein may rely on the representations of the Borrower
contained in such affidavit or certificate.
ARTICLE IV. CONDEMNATION
19
4.1 Condemnation. (a) If all or any portion of the Mortgaged
Property is taken by condemnation or eminent domain powers of any Governmental
Authority (or any transfer by private sale in lieu thereof), either temporarily
or permanently, then the award and other proceeds payable in connection
therewith shall be paid to Lender and applied to payment of the Indebtedness
after deducting any costs incurred by Lender in connection therewith. To the
extent that Lender determines that the remaining portion of the Mortgaged
Property is adequate to secure the Indebtedness, the proceeds will be held and
applied as provided on the conditions set forth in subparagraph (d) below.
(b) Participation in Proceedings. Borrower shall promptly
notify Lender of any actual or threatened initiation of any condemnation or
eminent domain proceeding as to any part of the Mortgaged Property and shall
deliver to Lender copies of any and all papers served or received in connection
with such proceedings, and Lender shall have the right, at its option, to
participate in such proceedings at the expense of Borrower (including without
limitation the Lender's attorneys' fees). Borrower shall execute such documents
and take such other steps as required to permit such participation.
(c) Right to Settle Claims. Lender is hereby authorized to
adjust, compromise and collect any condemnation or eminent domain award or
settle a claim for damages and to apply the same to the Indebtedness, subject to
the provisions of subparagraph (d) below.
(d) Use of Proceeds. Borrower hereby assigns to Lender any
proceeds or awards which may become due by reason of any condemnation or other
taking for public use of the whole or any part of the Mortgaged Property or any
rights appurtenant thereto, and Lender is authorized, at its option, to collect
and receive all such compensation, awards or damages and to give proper receipts
and acquittances therefor without any obligation to question the amount of any
such compensation, awards or damages. The proceeds of any such condemnation
award or proceeds or any part thereof may be applied by Lender to the
Indebtedness, whether or not due and in such order as Lender elects; provided
that subject to the provisions of subparagraph (a) above, such proceeds shall be
applied to restoration of the property taken if the following conditions are
met:
(i) there exists no Event of Default or any event or condition
which, upon the giving of notice or the passage of time or both, would
constitute an Event of Default;
(ii) Borrower presents sufficient evidence to the Lender that
(A) there are sufficient funds from the condemnation award or proceeds
and from equity funds, if needed, to completely restore the Mortgaged
Property to an architectural whole as well as to maintain relevant debt
service coverages and other operating expenses, and (B) the loss of the
property taken will. not materially diminish the value of the Mortgaged
Property;
(iii) all parties having existing or expected possessory
interests in the Mortgaged Property (excluding resident apartment
tenants) agree in a manner satisfactory to Lender that
20
they will continue or extend their interests and arrangements for
the contract terms then in effect following the restoration;
(iv) all parties having operating, management or franchise
interests in, or arrangements concerning, the Mortgaged Property agree
that they will continue their interests and arrangements for the
contract terms then in effect following the restoration;
(v) all parties having commitments to provide financing with
respect to all or any part of the Mortgaged Property, to purchase all
or any part of Borrower's interest in all or any part of the Mortgaged
Property, or to purchase all or any part of the Note agree in a manner
satisfactory to Lender that their commitments will continue in full
force and effect and, if necessary, the expiration of such commitments
will be extended by the time necessary to complete the restoration;
(vi) Borrower Presents sufficient evidence to Lender that the
Mortgaged Property will be restored to an architectural whole prior to
the maturity of the Note;
(vii) Lender will not incur any liability to any other person
as a result of such use or release of proceeds;
Lender shall hold and disburse the condemnation award or proceeds as restoration
progresses subject to the conditions of Paragraph 3.21 hereof as if such
proceeds were insurance proceeds.
(e) Further Assignment. Borrower agrees to execute such
further assignments of any compensation, awards, damages, claims, rights of
action and proceeds as Lender may require. If, prior to the receipt by Lender of
such award or proceeds, the Mortgaged Property shall have been bid on
foreclosure of this Security Deed, Lender shall have the right to receive such
award or proceeds to the extent of any unpaid Indebtedness following such sale,
with legal interest thereon, whether or not a deficiency judgment on this
Security Deed or the Note shall have been sought or recovered, and to the extent
of attorneys' fees, costs and disbursements incurred by Lender in connection
with the collection of such award or proceeds. If Borrower fails to assign such
compensation, awards, damages, claims, rights of action, and proceeds as
aforesaid, Lender may execute such endorsements or transfers for and in the name
of Borrower and Borrower hereby appoints Lender as Borrower's agent and
attorney-in-fact so to do, such appointment being coupled with an interest and
being irrevocable.
4.2 Release of Property from Security Deed. If all or any
portion of the Mortgaged Property is taken by condemnation or eminent domain (or
any transfer by private sale in lieu thereof), and the award and other proceeds
payable in connection therewith are paid to Lender as required by Paragraph 4.1
above, then, at the request of Borrower, Lender will release said portion of the
Mortgaged Property from this Security Deed upon satisfaction of, and in
accordance with, the following requirements and procedures:
21
(a) Borrower's request for a release shall be accompanied by
(i) a survey of the portion of the Mortgaged Property to be released,
(ii) a metes and bounds legal description of the portion of the
Mortgaged Property to be released, (iii) the quitclaim deed or other
instrument to be used to effect such release, and (iv) such other
documents and information as Lender may reasonably request in order to
process and effect such release, all in form and substance acceptable
to Lender.
(b) All costs and expenses of Lender associated with such
release (including, without limitation, attorneys' fees) shall be paid
by Borrower.
The execution and delivery of any such release shall not affect Borrower's
Obligations hereunder or under the other Loan Documents.
ARTICLE V. EVENTS OF DEFAULT
The term "Event of Default," as used herein and in the other Loan
Documents, shall mean the occurrence or happening, at any time and from time to
time, of any one or more of the following:
5.1 Failure in Payment of Indebtedness. If Borrower shall
fail, refuse or neglect to pay, in full, any installment or portion of the
Indebtedness within ten (10) days after written notice from Lender that the same
is due and payable, whether at the due date thereof stipulated in the Loan
Documents, or at a date fixed for prepayment, or by acceleration or otherwise;
provided, however, that if such installment or portion of the Indebtedness
becomes due and payable as a result of Lender's accelerating the maturity of the
Indebtedness in accordance with the Loan Documents, the ten (10) day notice and
cure period for payment set forth in this Paragraph 5.1 shall not apply to the
accelerated due date.
5.2 Failure in Performance of Obligations. If Borrower shall
fail, refuse or neglect to perform and discharge fully and timely any of the
Obligations as and when called for, and such failure, refusal or neglect shall
either be incurable or, if curable, shall remain uncured for a period of thirty
(30) days after the date of written notice thereof from Lender to Borrower;
provided, however, that if such default is curable but requires work to be
performed, acts to be done or conditions to be remedied which, by their nature,
cannot be performed, done or remedied, as the case may be, within such thirty
(30) day period, then Borrower shall submit a plan to Lender for the cure of
such default, and if Lender approves such plan (which approval may be granted,
withheld or conditioned in Lender's sole and absolute discretion), no Event of
Default shall be deemed to have occurred if Borrower commences such cure within
such thirty (30) day period and thereafter diligently and continuously
prosecutes the same to completion in accordance with the plan approved by
Lender.
5.3 False Representation. If any representation, warranty or
statement made by Borrower or others in, under or pursuant to the Loan
Commitment (as that term is defined in the Loan
22
Agreement), the Loan Documents or any affidavit, instrument or other document
executed or delivered in connection with the Loan Documents shall be false or
misleading in any material respect as of the date hereof or shall become so at
any time prior to the repayment in full of the Indebtedness.
5.4 Voluntary Bankruptcy. If Borrower or, if Borrower is a
partnership, joint venture, trust or other type of business association, if any
of the parties comprising Borrower shall (a) voluntarily be adjudicated as
bankrupt or insolvent, (b) file any petition or commence any case or proceeding
under any provision or chapter of the Federal Bankruptcy Code or any other
federal or state law relating to insolvency, bankruptcy, rehabilitation,
liquidation or reorganization, (c) make a general assignment for the benefit of
its creditors, (d) have an order for relief entered against it under the Federal
Bankruptcy code, (e) convene a meeting of its creditors, or any class thereof,
for the purpose of effecting a moratorium upon or extension or composition of
its debts, (f) fail to pay its debts as they mature, (g) admit in writing that
it is generally not able to pay its debts as they mature or generally not pay
its debts as they mature, or (h) become insolvent.
5.5 Involuntary Bankruptcy. If (a) a petition is filed or any
case or proceeding described in Paragraph 5.4 above is commenced against
Borrower, or, if Borrower is a partnership, joint venture, trust or other type
of business association, against any of the parties comprising Borrower or
against the assets of any such persons or entities, unless such petition and the
case or proceeding initiated thereby is dismissed within sixty (60) days from
the date of the filing, (b) an answer is filed by Borrower or, if Borrower is a
partnership, joint venture, trust or other type of business association, by any
of the parties comprising Borrower, admitting the allegations of any such
petition, or (c) a court of competent jurisdiction enters an order, judgment or
decree appointing, without the consent of Borrower or, if Borrower is a
partnership, joint venture, trust or other type of business association, of any
of the parties comprising Borrower, a custodian, trustee, agent or receiver for
it, or for all or any part of its property, or authorizing the taking possession
by a custodian, trustee, agent or receiver of such entity, or all or any part of
its property unless such appointment is vacated or dismissed or such possession
is terminated within sixty (60) days from the date of such appointment or
commencement of such possession, but not later than five (5) days before the
proposed sale of any assets of Borrower or, if Borrower is a partnership, joint
venture, trust or other business association, of any of the parties comprising
Borrower, by such custodian, trustee, agent or receiver, other than in the
ordinary course of the business of Borrower.
5.6 Intentionally Omitted
5.7 Dissolution, Change or Encumbrance of Ownership. (a) If
Borrower or if any of the parties directly or indirectly comprising Borrower
shall die, dissolve, terminate or liquidate, or merge with or be consolidated
into any other entity, or shall hypothecate, pledge, mortgage or otherwise
encumber all or any part of the beneficial ownership interest in Borrower or
shall attempt to do any of the same; or (b) if Borrower shall amend or modify,
in a manner which would adversely affect Lender, its articles of incorporation,
bylaws, partnership agreement, certificate of partnership or other charter or
enabling documents, and Lender has not given its prior written consent to such
23
amendments or modifications which approval shall not be unreasonably withheld,
delayed or conditioned. Lender acknowledges that (i) the limited partners of
Borrower and the shareholders of general partner of Borrower, Xxxxxxx Realty
Investors, Inc., a real estate investment trust (hereinafter "RRI") may, without
Lender's consent, transfer and assign limited partnership units in Borrower and
shares in RRI in the ordinary course of business; and (ii) Borrower or RRI may
complete any merger or consolidation involving Borrower or RRI when Borrower or
RRI is the surviving entity; provided, however, that nothing herein shall
release Borrower or RRI from its obligations under the Loan Documents.
5.8 Disposition of Mortgaged Property and Beneficial Interest
in Borrower. If Borrower sells, leases, exchanges, assigns, conveys, transfers
or otherwise disposes of (herein collectively called "Disposition") all or if
any portion of the Mortgaged Property (or any interest therein) or all or any
part of the beneficial ownership interest in Borrower (if Borrower is a
corporation, partnership, joint venture, trust or other type of business
association or legal entity) is sold, transferred or otherwise disposed of,
without the prior written consent of Lender. Lender acknowledges that (i) the
limited partners of Borrower and the shareholders of RRI may, without Lender's
consent, transfer and assign limited partnership units in Borrower and shares in
RRI in the ordinary course of business; and (ii) Borrower or RRI may complete
any merger or consolidation involving Borrower or RRI when Borrower or RRI is
the surviving entity; provided, however, that nothing herein shall release
Borrower or RRI from its obligations under the Loan Documents.
5.9 Encumbrance Upon Mortgaged Property. If Borrower shall,
without the prior written consent of Lender, create, place or permit to be
created or placed, or through any act or failure to act, acquiesce in the
placing of, or allow to remain, any mortgage, security deed, pledge, lien
(statutory, constitutional or contractual), security title or interest,
encumbrance or charge on, or conditional sale or other title retention
agreement, regardless of whether same are expressly subordinate to the liens of
the Loan Documents, with respect to the Mortgaged Property, the "Construction
Contracts" or the "Plans" (as those terms are defined in the Loan Agreement),
other than the Permitted Encumbrances.
5.10 Intentionally omitted
5.11 Foreclosure of Other Liens. If the holder of any lien or
security title, interest or deed on the Mortgaged Property (without hereby
implying Lender's consent to the existence, placing, creating or permitting of
any such lien or security title, interest or deed) institutes foreclosure or
other proceedings for the enforcement of its remedies thereunder.
5.12 Default Under Other Loan Documents. In the event an Event
of Default shall occur under any other Loan Document (even though not listed as
an Event of Default hereunder and the applicable cure period shall expire).
5.13 Default Under Other Loans. If Borrower should default in
the payment of any other loan from Lender to Borrower, whether now or hereafter
existing, or fail to perform any of its obligations in connection therewith.
24
5.14 Failure of Other Collateral. If Borrower shall fail to
deliver or maintain any collateral as required by the Loan Documents.
ARTICLE VI. LENDER'S REMEDIES
6.1 Remedies. If an Event of Default shall occur, Lender may,
at its sole election, exercise any or all of the following rights, remedies and
recourses:
(a) Acceleration: Declare the then unpaid principal balance on
the Note, the accrued interest and any other accrued but unpaid portion of the
Indebtedness to be immediately due and payable, without further notice,
presentment, protest, demand or action of any nature whatsoever (each of which
hereby is expressly waived by Borrower), whereupon the same shall become
immediately due and payable, time being of the essence in this Security Deed.
(b) Termination of License. (i) Terminate the License granted
to Borrower in Paragraph 8.3 hereof and exercise the rights, powers and
privileges of landlord under the Leases, and then and thereafter, with or
without taking possession of the Mortgaged Property, in Borrower's own name,
demand, collect, receive, xxx for, attach and levy on the Rents (including
demand for Rents collected for the period in which the demand occurs) and give
proper receipts, releases and acquittances therefor.
(ii) Deliver a written demand to any Tenant for
payment of Rents, which demand shall be sufficient evidence of each such
Tenant's obligation and authority to make all future payments of Rents to Lender
without the necessity for further consent by the Borrower. Borrower hereby
indemnifies and agrees to hold each Tenant free and harmless from and against
all liability, loss, cost, damage or expense suffered or incurred by such Tenant
by reason of its compliance with any demand for payment of Rents made by Lender
contemplated by the preceding sentence. Borrower, for itself and its agents,
covenants and agrees not to countermand any such written demand to Tenants for
payment of Rents.
(c) Entry on Mortgaged Property: (i) Demand that Borrower
shall forthwith surrender to Lender the actual possession of the Mortgaged
Property, and to the extent permitted by law, enter and take possession of all
of the Mortgaged Property without the appointment of a receiver, or an
application therefor, and exclude Borrower and its agents and employees wholly
therefrom, and have joint access with Borrower to the books, papers and accounts
of Borrower.
(ii) If Borrower shall for any reason fail to
surrender or deliver the Mortgaged Property or any part thereof after such
demand by Lender, Lender may seek a judgment or decree conferring upon Lender
the right to immediate possession or requiring Borrower to deliver immediate
possession of the Mortgaged Property to Lender, and Borrower hereby specifically
covenants and agrees that Borrower shall not oppose, contest or otherwise hinder
or delay Lender
25
in any action or proceeding by Lender to obtain such judgment or decree.
Borrower shall pay to Lender, upon demand, all expenses of obtaining such
judgment or decree, including reasonable compensation to Lender, its attorneys
and agents, and all such expenses and compensation shall, until paid, become
part of the Indebtedness and shall be secured by this Security Deed.
(iii) Upon every such entering upon or taking of
possession, Lender may hold, store, use, operate, manage and control the
Mortgaged Property and conduct the business thereof, and, from time to time, (A)
make all necessary and proper maintenance, repairs, renewals, replacements,
additions, betterments and improvements thereto and thereon and purchase or
otherwise acquire additional fixtures, personalty and other property, (B) insure
or keep the Mortgaged Property insured, (C) manage and operate the Mortgaged
Property and exercise all the rights and powers of Borrower to the same extent
Borrower could in its own name or otherwise act with respect to the same, and
(D) enter into any and all agreements with respect to the exercise by others of
any of the powers herein granted to Lender, all as Lender from time to time may
determine to be in its best interest. Anything in this Security Deed to the
contrary notwithstanding, Lender shall not be obligated to discharge or perform
the duties of the landlord to any Tenant or incur any liability as the result of
any exercise by Lender of its rights under this Security Deed, and Lender shall
be liable to account only for the Rents actually received by Lender.
(iv) Make, modify, enforce, cancel or accept
surrender of any Lease, remove and evict any Tenant, increase or decrease Rents
under any Lease, appear in and defend any action or proceeding purporting to
affect the Mortgaged Property, and perform and discharge each and every
obligation, covenant and agreement of Borrower contained in any Lease, whether
or not Lender takes possession of the Mortgaged Property.
(v) Neither the entering upon and taking possession
of the Mortgaged Property, nor the collection of any Rents and the application
thereof as aforesaid, shall cure or waive any Event of Default theretofore or
thereafter occurring, or affect any notice of an Event of Default hereunder or
invalidate any act done pursuant to any such notice. Lender shall not be liable
to Borrower, anyone claiming under or through Borrower, or anyone having an
interest in the Mortgaged Property by reason of anything done or left undone by
Lender hereunder. Nothing contained in this Paragraph 6.1(c) shall require
Lender to incur any expense or do any act. If the Rents are not sufficient to
meet the costs of taking control of and managing the Mortgaged Property and/or
collecting the Rents, any funds expended by Lender for such purposes shall
become Indebtedness of Borrower to Lender secured by this Security Deed. Such
amounts, together with interest at the Default Rate under the Note and
attorneys' fees, if applicable, shall be immediately due and payable.
Notwithstanding Lender's continuance in possession or receipt and application of
Rents, Lender shall be entitled to exercise every right provided for in this
Security Deed or by law upon or after the occurrence of an Event of Default. Any
of the actions referred to in this Paragraph 6. 1 (c) may be taken by Lender at
such time as Lender is so entitled, without regard to the adequacy of any
security for the Indebtedness hereby secured.
26
(vi) In the event that all interest, deposits and
principal installments and other sums due under any of the terms, covenants,
conditions and agreements of this Security Deed and the other Loan Documents
shall be paid and all Events of Default shall be cured, and as a result thereof
Lender surrenders possession of the Mortgaged Property to Borrower, the same
right herein given to Lender shall continue to exist if any subsequent Events of
Default shall occur.
(d) Foreclosure and Sale: Sell the Mortgaged Property or any
part thereof at one or more public sales before the door of the courthouse of
the county in which the Property or any part of the Property is situated,
without notice except as required or set forth herein, to the highest bidder for
cash, in order to pay the Indebtedness, and all expenses of sale and of all
proceedings in connection therewith, including reasonable attorneys' fees, after
advertising the time, place and terms of sale once a week for four (4) weeks
immediately preceding such sale (but without regard to the number of days) in a
newspaper in which Sheriff's sales are advertised in said county. At any such
public sale, Lender may execute and deliver to the purchaser or purchasers at
such sale or sales a conveyance of the Mortgaged Property or any part of the
Mortgaged Property in fee simple, with full warranties of title, and to this end
Borrower hereby constitutes and appoints Lender the agent and attorney-in-fact
of Borrower to make such sale and conveyance, and thereby to divest Borrower of
all right, title and equity that Borrower may have in and to the Mortgaged
Property and to vest the same in the purchaser or purchasers at such sale or
sales; and all the acts and doings of said agent and attorney-in-fact are hereby
ratified and confirmed and any recitals in said conveyance or conveyances as to
facts essential to a valid sale shall be binding upon Borrower. The aforesaid
power of sale and agency hereby granted are coupled with an interest and are
irrevocable by death or otherwise, are granted as cumulative of the other
remedies provided hereby or by law for collection of the Indebtedness, and shall
not be exhausted by one exercise thereof but may be exercised until full payment
of all of the Indebtedness. In the event of any sale under this Security Deed by
virtue of the exercise of the powers herein granted, or pursuant to any order in
any judicial proceedings or otherwise, the Mortgaged Property may be sold as an
entirety or in separate parcels and in such manner or order as Lender in its
sole discretion may elect, and if Lender so elects, Lender may sell the
Personalty covered by this Security Deed at one or more separate sales in any
manner permitted by the Uniform Commercial Code of the State of Georgia, and one
or more exercises of the powers herein granted shall not extinguish nor exhaust
such powers, until the entire Mortgaged Property is sold or the Indebtedness is
paid in full. If the Indebtedness is now or hereafter further secured by any
chattel mortgages, pledges, contracts of guaranty, assignments of lease or other
security instruments, Lender may at its option exhaust the remedies granted
under any of said security instruments, either concurrently or independently,
and in such order as Lender may determine.
Lender, may, in addition to and not in abrogation of the
rights covered under the immediately preceding subparagraph, or elsewhere in
this Article VI, either with or without entry or taking possession as herein
provided or otherwise, proceed by a suit or suits in law or in equity or by any
other appropriate proceeding or remedy (i) to enforce payment of the Note or the
performance of any term, covenant, condition or agreement of this Security Deed
or any other right and (ii) to pursue any other remedy available to it, all as
Lender at its sole discretion shall elect.
27
(e) Receiver: Lender, upon application to a court of competent
jurisdiction, shall be entitled as a matter of strict right, without notice and
without regard to the adequacy or value of any security for the Indebtedness or
the solvency of any party bound for its payment, to the appointment of a
receiver to take possession of and to operate the Mortgaged Property and to
collect and apply the incomes, rents, issues, profits and revenues thereof. The
receiver shall have all of the rights and powers permitted under the laws of the
State of Georgia. Borrower shall pay to Lender upon demand all expenses,
including receiver's fees, attorneys' fees, costs and agent's compensation,
incurred pursuant to the provisions of this Paragraph 6.1(e), and any such
amounts paid by Lender shall be added to the Indebtedness and shall be secured
by this Security Deed.
(f) Performance by Lender: Pay, perform or observe any term,
covenant or condition of this Security Deed not paid, performed or observed by
Borrower, and all payments made or costs or expenses incurred by Lender in
connection therewith shall be secured hereby and shall be, without demand,
immediately repaid by Borrower to Lender with interest thereon at the Default
Rate provided in the Note. Lender shall be the sole judge of the necessity for
any such actions and of the amounts to be paid. Lender is hereby empowered to
enter and to authorize others to enter upon the Mortgaged Property or any part
thereof for the purpose of performing or observing any such defaulted term,
covenant or condition without thereby becoming liable to Borrower or any person
in possession holding under Borrower.
(g) Relief From Automatic Stay. In the event that Borrower is
the subject of any insolvency, bankruptcy, receivership, dissolution,
reorganization, or similar proceeding, federal or state, voluntary or
involuntary, under any present or future law or act, Lender shall be entitled to
relief from the automatic stay as to the enforcement of its remedies under the
Loan Documents against the Mortgaged Property, including specifically, but not
limited to, the stay imposed by 11 U.S.C., Section 362, as amended, and Borrower
hereby consents to the immediate lifting of any such automatic stay and will not
contest any motion by Lender to lift such stay. Borrower expressly acknowledges
that (i) the Mortgaged Property is not now and will never be necessary to any
plan of reorganization of any type, and (ii) no reorganization of Borrower's
business is possible or feasible.
(h) Other: Exercise any and all other rights, remedies and
recourses granted under the Loan Documents (including, without limitation, those
set forth in Articles VII, VIII and IX hereinbelow) or now or hereafter existing
in equity, at law, by virtue of statute or otherwise.
6.2 Separate Sales. The Mortgaged Property may be sold in one
or more parcels and in such manner and order as Lender, in its sole discretion,
may elect, it being expressly understood and agreed that the right of sale
arising out of any Event of Default shall not be exhausted by any one or more
sales.
6.3 Remedies Cumulative, Concurrent and NonExclusive. Lender
shall have all rights, remedies and recourses granted in the Loan Documents and
available at law or equity (including specifically those granted by the Uniform
Commercial Code in effect and applicable to the
28
Mortgaged Property or any portion thereof); and same (a) shall be cumulative and
concurrent, (b) may be pursued separately, successively or concurrently against
Borrower or others obligated under the Note, or against the Mortgaged Property,
or against any one or more of them, at the sole discretion of Lender, (c) may be
exercised as often as occasion therefor shall arise, it being agreed by Borrower
that the exercise or failure to exercise any of same shall in no event be
construed as a waiver or release thereof or of any other right, remedy or
recourse, and (d) are intended to be, and shall be, nonexclusive.
6.4 No Conditions Precedent to Exercise of Remedies. Neither
Borrower nor any other person hereafter obligated for payment of all or any part
of the Indebtedness, or fulfillment of all or any of the Obligations, shall be
relieved of such obligation by reason of (a) the failure of Lender to comply
with any request of Borrower or of any other person so obligated, to foreclose
this Security Deed or to enforce any provisions of the other Loan Documents, (b)
the release, regardless of consideration, of the Mortgaged Property or the
addition of any other property to the Mortgaged Property, (c) any agreement or
stipulation between any subsequent owner of the Mortgaged Property and Lender
extending, renewing, rearranging or in any other way modifying the terms of the
Loan Documents without first having obtained the consent of, given notice to or
paid any consideration to Borrower or such other person, and in such event,
Borrower and all such other persons shall continue to be liable to make payment
according to the terms of any such extension or modification agreement unless
expressly released and discharged, in writing, by Lender, or (d) by any other
act or occurrence, save and except the complete payment of the Indebtedness and
the complete fulfillment of all of the Obligations.
6.5 Release of and Resort to Collateral. Lender may release,
regardless of consideration, any part of the Mortgaged Property without, as to
the remainder, in any way impairing, affecting, subordinating or releasing the
conveyance, lien, encumbrance or security interests created in or evidenced by
the Loan Documents or their stature as a first and prior security deed, lien,
encumbrance or security interest in and to the Mortgaged Property. For payment
of the Indebtedness, Lender may resort to any security therefor held by Lender
in such order and manner as Lender may elect.
6.6 Waiver of Appraisement, Valuation, etc. Borrower agrees,
to the full extent permitted by law, that, in case of an Event of Default,
neither Borrower nor anyone claiming through or under Borrower will set up,
claim or seek to take advantage of any moratorium, reinstatement, forbearance,
appraisement, valuation, stay, extension, homestead, exemption or redemption
laws now or hereafter in force in order to prevent or hinder the enforcement or
foreclosure of this Security Deed or the absolute sale of the Mortgaged
Property, the delivery of possession thereof immediately after such sale to the
purchaser at such sale, or the exercise of any other remedy hereunder; and
Borrower, for itself and all who may at any time claim through or under it,
hereby waives to the full extent that it may lawfully so do, the benefit of all
such laws, and any and all right to have assets subject to the security title of
this Security Deed marshalled upon any foreclosure or sale under the power
herein granted or a sale in inverse order of alienation.
29
6.7 Discontinuance of Proceedings. In case Lender shall have
proceeded to enforce any right, power or remedy under this Security Deed by
foreclosure, entry or otherwise, or in the event Lender commences advertising of
the intended exercise of the sale under power provided hereunder and such
proceeding or advertisement shall have been withdrawn, discontinued or abandoned
for any reason, or shall have been determined adversely to Lender, then in every
such case (a) Borrower and Lender shall be restored to their former positions
and rights, (b) all rights, powers and remedies of Lender shall continue as if
no such proceeding had been taken, (c) each and every Event of Default declared
or occurring prior or subsequent to such withdrawal, discontinuance or
abandonment shall be and shall be deemed to be a continuing Event of Default and
(d) neither this Security Deed, nor the Note, nor the Indebtedness, nor any
other Loan Document, shall be or shall be deemed to have been reinstated or
otherwise affected by such withdrawal, discontinuance or abandonment; and
Borrower hereby expressly waives the benefit of any statute or rule of law now
provided, or which may hereafter be provided, which would produce a result
contrary to or in conflict with the above.
6.8 Application of Proceeds. The proceeds of any sale of, and
the Rents and other amounts generated by the holding, leasing, operation or
other use of, the Mortgaged Property (including, without limitation, the Leases)
shall be applied by Lender (or the receiver, if one is appointed) to the extent
that funds are so available therefrom to the following in the order of priority
that Lender, in its sole discretion, may determine:
(a) To the payment of the costs and expenses of taking
possession of the Mortgaged Property and of holding, using, leasing, repairing,
improving and selling the same, including, without limitation, (i) receivers'
fees, (ii) court costs, (iii) attorneys' and accountants' fees, (iv) costs of
advertisement, and (v) the payment of any and all Impositions, liens, security
interests or other rights, titles or interests equal or superior to this
Security Deed (except those to which the Mortgaged Property has been sold
subject to and without in any way implying Lender's prior consent to the
creation thereof);
(b) To the payment of all amounts, other than the principal
balance of the Note and accrued but unpaid interest, which may be due to Lender
under the Loan Documents, together with interest on all such amounts as
provided;
(c) To the payment of all accrued but unpaid interest due on
the Note;
(d) To the payment of the principal balance of the Note and
any remaining portion of the Indebtedness;
(e) To the extent funds are available therefor out of the sale
proceeds or the Rents, and to the extent known by Lender, and permitted by law,
to the payment of any indebtedness or obligation secured by a subordinate
interest in the Mortgaged Property; and
30
(f) Any remaining funds to Borrower. Borrower SHALL BE LIABLE
FOR ANY DEFICIENCIES IN THE EVENT THE PROCEEDS ARE NOT SUFFICIENT TO COVER ITEMS
(a) THROUGH (d) ABOVE.
6.9 Leases. Lender, at its option, is authorized to foreclose
this Security Deed subject to the rights of any Tenants of the Mortgaged
Property under any Leases, and the failure to make any Tenants parties to any
such foreclosure proceedings and to foreclose their rights shall not be, nor be
asserted to be by Borrower, a defense to any proceedings instituted by Lender to
collect the Indebtedness.
6.10 Purchase by Lender. Upon any foreclosure sale or sales of
all or any portion of the Mortgaged Property under the power of sale herein
granted, Lender may bid for and purchase the Mortgaged Property and shall be
entitled to apply all or any part of the Indebtedness as a credit to the
purchase price.
6.11 Borrower as Tenant Holding Over. In the event of any such
foreclosure sale or sales under the power herein granted, Borrower shall be
deemed a tenant holding over and shall forthwith deliver possession to the
purchaser or purchasers at such sale or be summarily dispossessed according to
provisions of law applicable to tenants holding over.
6.12 Suits to Protect the Mortgaged Property. Lender shall
have the power to institute and maintain such suits and proceedings as it may
deem expedient (i) to prevent any impairment of the Mortgaged Property by any
acts which may be unlawful or constitute an Event of Default under this Security
Deed, (ii) to preserve or protect its interest in the Mortgaged Property and in
the Leases and Rents arising therefrom, and (iii) to restrain the enforcement of
or compliance with any legislation or other governmental enactment, rule or
order that may be unconstitutional or otherwise invalid, if the enforcement of
or compliance with such enactment, rule or order would impair the security
hereunder or be prejudicial to the interest of Lender.
6.13 Proofs of Claim. In the case of any receivership,
insolvency, bankruptcy, reorganization, arrangement, adjustment, composition or
other proceedings affecting Borrower, its creditors or its property, Lender, to
the extent permitted by law, shall be entitled to file such proofs of claim and
other documents as may be necessary or advisable in order to have the claims of
Lender allowed in such proceedings for the entire amount of the Indebtedness at
the date of the institution of such proceedings and for any additional amount of
the Indebtedness after such date.
6.14 Occupancy After Foreclosure. The purchaser at any
foreclosure sale pursuant to Paragraph 6.1(d) shall become the legal owner of
the Mortgaged Property or the portion thereof foreclosed. All occupants (except
those which have previously executed a prior written agreement with purchaser)
of the Mortgaged Property or any part thereof shall become tenants at sufferance
of the purchaser at the foreclosure sale and shall deliver possession thereof
immediately to the purchaser upon demand.
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6.15 Waiver of Borrower's Rights. BY EXECUTION OF THIS
SECURITY DEED AND BY INITIALING THIS PARAGRAPH 6.15, BORROWER EXPRESSLY: (A)
ACKNOWLEDGES THE RIGHT OF LENDER TO ACCELERATE THE INDEBTEDNESS EVIDENCED BY THE
NOTE AND ANY OTHER INDEBTEDNESS SECURED BY THIS SECURITY DEED AND THE POWER OF
ATTORNEY GIVEN HEREIN TO LENDER TO SELL THE MORTGAGED PROPERTY BY NONJUDICIAL
FORECLOSURE UPON AN EVENT OF DEFAULT BY BORROWER WITHOUT ANY JUDICIAL HEARING
AND WITHOUT ANY NOTICE OTHER THAN SUCH NOTICE (IF ANY) AS IS SPECIFICALLY
REQUIRED TO BE GIVEN UNDER THE PROVISIONS OF THIS SECURITY DEED; (B) WAIVES ANY
AND ALL RIGHTS WHICH BORROWER MAY HAVE UNDER THE CONSTITUTION OF THE UNITED
STATES OF AMERICA (INCLUDING, WITHOUT LIMITATION, THE FIFTH AND FOURTEENTH
AMENDMENTS THEREOF), THE VARIOUS PROVISIONS OF THE CONSTITUTIONS FOR THE SEVERAL
STATES, OR BY REASON OF ANY OTHER APPLICABLE LAW, (1) TO NOTICE AND TO JUDICIAL
HEARING PRIOR TO THE EXERCISE BY LENDER OF ANY RIGHT OR REMEDY HEREIN PROVIDED
TO LENDER, EXCEPT SUCH NOTICE (IF ANY) AS IS SPECIFICALLY REQUIRED TO BE GIVEN
UNDER THE PROVISIONS OF THIS SECURITY DEED AND (2) CONCERNING THE APPLICATION,
RIGHTS OR BENEFITS OF ANY STATUTE OF LIMITATION OR ANY MORATORIUM,
REINSTATEMENT, MARSHALLING, FORBEARANCE, APPRAISEMENT, VALUATION, STAY,
EXTENSION, HOMESTEAD, EXEMPTION OR REDEMPTION LAWS; (C) ACKNOWLEDGES THAT
BORROWER HAS READ THIS SECURITY DEED AND ANY AND ALL QUESTIONS OF BORROWER
REGARDING THE LEGAL EFFECT OF THIS SECURITY DEED AND ITS PROVISIONS HAVE BEEN
EXPLAINED FULLY TO BORROWER, AND BORROWER HAS CONSULTED WITH COUNSEL OF
BORROWER'S CHOICE PRIOR TO EXECUTING THIS SECURITY DEED AND INITIALING THIS
PARAGRAPH 6.15; AND (D) ACKNOWLEDGES THAT ALL WAIVERS OF THE AFORESAID RIGHTS OF
BORROWER HAVE BEEN MADE KNOWINGLY, INTENTIONALLY AND WILLINGLY BY BORROWER AS
PART OF A BARGAINED FOR LOAN TRANSACTION AND THAT THIS SECURITY DEED IS VALID
AND ENFORCEABLE BY LENDER AGAINST BORROWER IN ACCORDANCE WITH ALL THE TERMS AND
CONDITIONS HEREOF.
INITIALED BY BORROWER:
/s/ Xxxxxxx X. Xxxxxxx
--------------------------------
ARTICLE VII. SECURITY AGREEMENT
7.1 Security Interest. This Security Deed shall be construed
as a deed to secure debt on the Mortgaged Property, and it shall also constitute
and serve as a "Security Agreement" on personal property within the meaning of,
and shall constitute until this Security Deed shall terminate, as provided in
Article II hereinabove, a first and prior security interest under the Uniform
Commercial Code as enacted in the State of Georgia with respect to the
Personalty, Fixtures, Construction
32
Contract, Plans, Leases and Rents. To this end, Borrower has GRANTED, BARGAINED,
CONVEYED, ASSIGNED, TRANSFERRED and SET OVER, and by these presents, does GRANT,
BARGAIN, CONVEY, ASSIGN, TRANSFER and SET OVER, unto Lender a first and prior
security interest and all of Borrower's right, title and interest in, to, under
and with respect to the Personalty, Fixtures, Construction Contracts, Plans,
Leases and Rents ("Collateral") to secure the full and timely payment of the
Indebtedness and the full and timely performance and discharge of the
Obligations. It is the intent of Borrower and Lender that this Security Deed
encumber all Leases and Rents, that all items contained in the definition of
"Leases" and "Rents" which are included within Article 9 of the Uniform
Commercial Code of Georgia be covered by the security interest granted in this
Article VII and that all items contained in the definition of "Leases" and
"Rents" which are excluded from Article 9 of the Uniform Commercial Code of
Georgia be covered by the provisions of Article II and Article VIII hereof.
With regard to the Construction Contracts and the Plans, this
assignment is for the purposes of security only, and it does not and will not
operate or have the effect of delegating to the Lender any of Borrower's duties,
responsibilities or liabilities under any of the Loan Documents until such time
as Lender has notified the other party to a Construction Contract, if
applicable, and made independent arrangements with said party. Upon a default by
Borrower under any of the Loan Documents which is not cured within any
applicable cure period, as therein provided, Lender shall be and is hereby
permitted to, at its option, exercise the rights granted hereunder by notifying
one or more of said parties of its election. Borrower hereby authorizes any
other party to any Construction Contract to rely upon notice from Lender that
Borrower is in default under any of the Loan Documents.
7.2 Financing Statements. Borrower hereby agrees with Lender
to execute and deliver to Lender, in form and substance satisfactory to Lender,
such Financing Statements and such further assurances as Lender may, from time
to time, reasonably consider necessary to create, perfect and preserve Lender's
security interest herein granted, and Lender may cause such statements and
assurances to be recorded and filed, at such times and places as may be required
or permitted by law, to so create, perfect and preserve such security interest.
7.3 Uniform Commercial Code Remedies. Lender shall have all
the rights, remedies and recourses with respect to the Personalty, Fixtures,
Construction Contracts, Plans, Leases and Rents afforded to a "Secured Party" by
the Uniform Commercial Code of Georgia as to property within the scope thereof
and situated in the State of Georgia, in addition to, and not in limitation of,
the other rights, remedies and recourses afforded by the Loan Documents.
7.4 Warranty. Borrower warrants that Borrower shall promptly
execute any financing statements or other instruments deemed necessary by Lender
to prevent any filed financing statement from becoming misleading or losing its
perfected status.
7.5 Foreclosure of Security Interest. If an Event of Default
shall occur, Lender may elect, in addition to exercising any and all other
rights, remedies and recourses set forth in Article VI or
33
referred to in Paragraph 7.3 hereinabove or Article VIII hereinbelow, to proceed
in, the manner set forth in Article 9, Section 501 of the Uniform Commercial
Code of Georgia, relating the procedure to be followed when a Security Agreement
covers both real and personal property.
7.6 Construction Mortgage. If the term "construction mortgage"
is referenced on the first page hereof, this Security Deed secures future
advances to be used for construction of improvements on the Land pursuant to the
Loan Agreement and, accordingly, this Security Deed shall constitute a
construction mortgage.
7.7 No Obligation of Grantee. The assignment and security
interest herein granted shall not be deemed or construed to constitute Lender as
a trustee or mortgagee in possession of the Mortgaged Property, to obligate
Lender to lease the Mortgaged Property or attempt to do same, or to take any
action, incur any expense or perform or discharge any obligation, duty or
liability whatsoever under any of the Leases or otherwise.
ARTICLE VIII. ASSIGNMENT OF LEASES AND RENTS
8.1 Assignment. For and in consideration of the sum of TEN
DOLLARS ($10.00), and other good and valuable consideration, including the
Indebtedness, the receipt and sufficiency of which are hereby acknowledged, and
in order to secure the full and timely payment of the Indebtedness and the full
and timely performance and discharge of the Obligations, Borrower has GRANTED,
BARGAINED, SOLD, CONVEYED, ASSIGNED, TRANSFERRED, SET OVER and DELIVERED, and by
these, presents does hereby GRANT, BARGAIN, SELL, CONVEY, ASSIGN, TRANSFER, SET
OVER and DELIVER absolutely unto Lender the Leases (whether now existing or
entered into after the date hereof) and the Rents, subject only to the
hereinafter described License, TO HAVE AND TO HOLD the Leases and the Rents unto
Lender, its successors and assigns, forever, and Borrower does hereby bind
itself, its successors and assigns to WARRANT and FOREVER DEFEND the title to
the Leases and the Rents unto Lender against every person whomsoever lawfully
claiming or to claim the same or any part thereof. Upon the occurrence of an
Event of Default, Lender shall have the right, power and privilege (but shall be
under no duty) to demand possession of the Rents, which demand shall, to the
fullest extent permitted by applicable law, be sufficient action by Lender to
entitle Lender to immediate and direct payment of the Rents (including delivery
to Lender of Rents collected for the period in which the demand occurs and for
any subsequent period), for application as provided herein, all without the
necessity of any further action by Lender, including, without limitation, any
action to obtain possession of the Improvements or the Property. Borrower hereby
authorizes and directs the tenants under the Leases to pay Rents to Lender upon
written demand by Lender, without further consent of Borrower, without any
obligation to determine whether an Event of Default has in fact occurred and
regardless of whether Lender has taken possession of any portion of the
Property, and the tenants may rely upon any written statement delivered by
Lender to the tenants. Any such payment to Lender shall constitute payment to
Borrower under the Leases, and Borrower hereby appoints Lender as Borrower's
lawful
34
attorney-in-fact for giving, and Lender is hereby empowered to give,
acquittances to any tenants for such payments to Lender after a default.
8.2 Continuation and Termination of Assignment. If Borrower
shall pay or cause to be paid the Indebtedness as and when same shall become due
and payable and shall perform and discharge or cause to be performed and
discharged the Obligations on or before the date the same are to be performed
and discharged, then this assignment shall thereupon be terminated and of no
further force and effect, and all rights, titles and interests conveyed pursuant
to this assignment shall become revested in Borrower without the necessity of
any further act or requirement by Borrower or Lender; provided, however, the
affidavit, certificate, letter or statement of any officer of Lender stating
that any part of the Indebtedness or the Obligations remains unpaid and
undischarged shall be and constitute conclusive evidence of the validity,
effectiveness or continuing force of the within assignment, and any person, firm
or corporation may, and is hereby authorized to, rely thereon.
8.3 Limited License. Provided that there exists no Event of
Default hereunder or under or in any Loan Document, Borrower shall have the
right under a limited license granted hereby, and Lender hereby grants to
Borrower a limited license (the "License"), to collect upon, but not prior to
accrual, all of the Rents arising from or out of the Leases, or any renewals or
extensions thereof, or from or out of the Mortgaged Property or any part
thereof, and Borrower shall receive such Rents and hold the same, as well as the
right and license to receive such Rents, as a trust fund to be applied, and
Borrower hereby covenants to apply the Rents, to the payment of interest and
principal becoming due on account of the Indebtedness, to the satisfaction and
discharge of the Obligations, including specifically, but without limitation, to
the payment of taxes and assessments upon the Mortgaged Property before payment
of penalty or interest are due thereon, to the cost of such insurance,
maintenance and repairs as may be required by the terms of this Security Deed
and in satisfaction of all obligations under the Leases, all prior to the
application by Borrower of the Rents for any other purposes.
8.4 Borrower's Indemnities. Borrower hereby agrees to
indemnify and hold Lender free and harmless from and against any and all
liability, loss, cost, damage or expense which Lender may incur under or by
reason of this assignment, or for any action taken by the Lender hereunder, or
by reason or in defense of any and all claims and demands whatsoever which may
be asserted against Lender arising out of the Leases, including specifically,
but without limitation, any claim by any Tenant of credit for Rents paid to and
received by Borrower, but not delivered to Lender, for any period under any
Lease more than one (1) month in advance of the due date thereof. In the event
Lender incurs any such liability, loss, cost, damage or expense, the amount
thereof, including reasonable attorneys' fees, with interest thereon at the
Default Rate specified in the Note, shall be payable by Borrower to Lender
immediately, without demand, and shall be secured hereby and by all other Loan
Documents.
8.5 Appointment of Attorney-in-Fact. Borrower hereby further
constitutes and appoints Lender the true and lawful attorney, coupled with an
interest, of the Borrower, and in the name, place and stead of said Borrower, to
subject and subordinate at any time and from time to time any Lease
35
or any part thereof to the lien and security title of the Security Deed or any
other mortgage, security deed, deed of trust or security agreement on or to any
ground lease of the Mortgaged Property, or to request or require such
subordination, where such reservation, option or authority was reserved to the
Borrower under any such Lease, or in any case where the Borrower otherwise would
have the right, power or privilege so to do. The foregoing appointment is
irrevocable and continuing, and such rights, powers and privileges shall be
exclusive in Lender, its successors and assigns so long as any part of the
Indebtedness or the Obligations secured hereby remains unpaid and undischarged,
and Borrower hereby warrants that Borrower has not at any time prior to the date
hereof exercised any such rights, and Borrower hereby covenants not to exercise
any such right, to subordinate any such Lease to the lien of this Security Deed
or to any other security deed, mortgage, deed of trust or security agreement or
to any ground lease.
8.6 Exculpation of Lender. The acceptance by Lender of this
assignment of the Leases and Rents, with all of the rights, powers, privileges
and authority created hereby shall not, prior to entry upon and taking
possession of the Mortgaged Property by Lender, be deemed or construed to
constitute Lender a "mortgagee in possession", nor thereafter or at any time or
in any event obligate the Lender to appear in or defend any action or proceeding
relating to the Leases, the Rents or the Mortgaged Property or to take any
action hereunder or to expend any money or incur any expenses or perform or
discharge any obligation, duty or liability under any Lease or to assume any
obligation or responsibility for any security deposits or other deposits
delivered to Borrower by any Tenant and not assigned and delivered to Lender,
nor shall Lender be liable in any way for any injury or damage to persons or
property sustained by any person or persons, firm or corporation in or about the
Mortgaged Property.
ARTICLE IX. MISCELLANEOUS
9.1 Performance at Borrower's Expense. Borrower shall pay to
Lender immediately upon demand all costs and expenses incurred by Lender in
connection with: (1) the preparation of this Security Deed and any and all other
Loan Documents contemplated hereby (including any amendments hereto or thereto
or consents, releases or waivers hereunder or thereunder), and the closing of
the loan evidenced by the Note and secured hereby; (2) the administration of
this Security Deed and the other Loan Documents for the term of the Note; and
(3) the enforcement or satisfaction by Lender of any of Borrower's Obligations
under this Security Deed or under the Loan Documents. For all purposes of this
Security Deed, Lender's costs and expenses shall include, without limitation,
all appraisal and re-appraisal fees, legal fees (including, without limitation,
fees for trial, appeal or other proceedings), accounting fees, environmental
consultant fees (if any), auditor fees, and the cost to Lender of any
documentary taxes, recording fees, brokerage fees, title search fees, title
insurance premiums and title surveys (including any such title related fees and
premiums incurred in connection with title updates). In addition, Borrower
recognizes and agrees that formal written appraisals of the Mortgaged Property
by a licensed independent appraiser may be required by federal regulatory
reporting requirements on an annual or specialized basis. Except to the extent
that certain of these costs and expenses are included within the definition of
Indebtedness, the payment by Borrower of any of these costs and expenses shall
not be credited, in any way or to any extent,
36
against any portion of the Indebtedness. If any of the services described in
this Paragraph 9.1 are provided by an employee of Lender, Borrower shall
reimburse Lender its standard charge for such services.
9.2 Survival of Obligations. Each and all of the Obligations
shall survive the execution and delivery of the Loan Documents, and the
consummation of the loan called for therein, and shall continue in full force
and effect until the Indebtedness shall have been paid in full; provided
however, that nothing contained in this Paragraph 9.2 shall limit the
obligations of Borrower as set forth in Paragraphs 3.6, 3.23 and 8.4 herein.
9.3 Further Assurances. Borrower, upon the request of Lender,
shall execute, acknowledge, deliver and record or file, as appropriate, such
further instruments and do such further acts as may be necessary, desirable or
proper to carry out more effectively the purpose of the Loan Documents and to
subject to the liens and security interests thereof any property intended by the
terms thereof to be covered thereby, including specifically, but without
limitation, any renewals, additions, substitutions, replacements, betterments or
appurtenances to the Mortgaged Property.
9.4 Recording and Filing. Borrower shall cause the Loan
Documents and all amendments and supplements thereto and substitutions therefor
to be recorded, filed, re-recorded and refiled in such manner and in such places
as Lender shall reasonably request and shall pay all such recording, filing,
re-recording and refiling taxes, fees and other charges.
9.5 Notices. All notices or other communications required or
permitted to be given pursuant to this Security Deed shall be in writing and
shall be considered as properly given if mailed by first-class United States
mail, postage prepaid, registered or certified with return receipt requested, or
by delivering same in person to the intended addressee, or by prepaid telegram,
telex or telecopy or by Federal Express or other reputable overnight courier
service. Notice so mailed shall be effective two (2) days after its deposit.
Notice given in any other manner shall be effective only if and when received by
the addressee or receipt is refused. For purposes of notice, the addresses of
the parties shall be as set forth in the first paragraph of this Security Deed;
provided, however, that either party shall have the right to change its address
for notice hereunder to any other location within the continental United States
by the giving of thirty (30) days' notice to the other party in the manner set
forth hereinabove.
9.6 No Waiver. Any failure by Lender to insist, or any
election by Lender not to insist, upon strict performance by Borrower of any of
the terms, provisions or conditions of the Loan Documents shall not be deemed to
be a waiver of same or of any other term, provision or condition thereof, and
Lender shall have the right at any time or times thereafter to insist upon
strict performance by Borrower of any and all such terms, provisions and
conditions. No delay or omission by Lender, or by any holder of the Note, to
exercise any right, power or remedy accruing upon any breach or Event of Default
shall exhaust or impair any such right, power or remedy or shall be construed to
be a waiver of any such breach or Event of Default, or acquiescence therein, and
every right, power and remedy given by this Security Deed to Lender may be
exercised from time to
37
time and as often as may be deemed expedient by Lender. No consent or waiver,
expressed or implied, by Lender to or of any breach or Event of Default by
Borrower in the performance of the Obligations of Borrower hereunder or to any
other Event of Default shall be deemed or construed to be a consent or waiver to
or of any other breach or Event of Default in the performance of the same or any
other Obligations of Borrower hereunder. Failure on the part of Lender to
complain of any act or failure to act or to declare an Event of Default,
irrespective of how long such failure continues, shall not constitute a waiver
by Lender of its rights hereunder or impair any rights, powers, or remedies of
Lender hereunder.
No act or omission by Lender shall release, discharge, modify, change
or otherwise affect the original liability under the Note, this Security Deed or
any other Obligations of Borrower or any subsequent purchaser of the Mortgaged
Property or any part thereof, or any maker, cosigner, endorser, surety, or
preclude Lender from exercising any right, power or privilege herein granted or
intended to be granted in the event of any Event of Default then made or by any
subsequent Event of Default, or alter the security title, security interest or
lien of this Security Deed, except as expressly provided in an instrument or
instruments executed by Lender. Without limiting the generality of the
foregoing, Lender may:
(a) grant forbearance or an extension of time for the payment
of all or any portion of the Indebtedness;
(b) take other or additional security for the payment of the
Indebtedness;
(c) waive or fail to exercise any right granted hereunder or
in the Note;
(d) change any of the terms, covenants, conditions or
agreements of the Note or this Security Deed;
(e) consent to the filing of any map, plat or replat affecting
the Mortgaged Property;
(f) consent to the granting of any easement or other right
affecting the Mortgaged Property;
(g) make or consent to any agreement subordinating the
security title, security interest or lien hereof; or
(h) take or omit to take any action whatsoever with respect to
the Note, this Security Deed, the Mortgaged Property or any document or
instrument evidencing, securing or in-any way relating to the Indebtedness;
all without releasing, discharging, modifying, changing or affecting any such
liability, or precluding Lender from exercising any such right, power or
privilege, or affecting the security title, security
38
interest or lien of this Security Deed. In the event of the sale or transfer by
operation of law or otherwise of all or any part of the Mortgaged Property,
Lender, without notice, is hereby authorized and empowered to deal with any such
vendee or transferee with reference to the Mortgaged Property or the
Indebtedness, or with reference to any of the terms, covenants, conditions or
agreements hereof, as fully and to the same extent as it might deal with the
original parties hereto and without in any way releasing or discharging any
liabilities, obligations or undertakings.
9.7 Lender's Right to Perform the Obligations. If Borrower
shall fail, refuse or neglect to make any payment or perform any act required by
the Loan Documents, then at any time thereafter, and without notice to or demand
upon Borrower and without waiving or releasing any other right, remedy or
recourse Lender may have because of same, Lender may (but shall not be obligated
to) make such payment or perform such act for the account of and at the expense
of Borrower, and shall have the right to enter the Property and Improvements for
such purpose and to take all such action thereon and with respect to the
Mortgaged Property as it may deem necessary or appropriate. If Lender shall
elect to pay any Imposition or other sums due with reference to the Mortgaged
Property, Lender may do so in reliance on any xxxx, statement or assessment
procured from the appropriate Governmental Authority or other issuer thereof
without inquiring into the accuracy or validity thereof. Similarly, in making
any payments to protect the security intended to be created by the Loan
Documents, Lender shall not be bound to inquire into the validity of any
apparent or threatened adverse title, lien, encumbrance, claim or charge before
making an advance for the purpose of preventing or removing the same. Borrower
shall indemnify Lender for all losses, expenses, damages, claims and causes of
action, including reasonable attorneys' fees, incurred or accruing by reason of
any acts performed by Lender pursuant to the provisions of this Paragraph 9.7 or
by reason of any other provision in the Loan Documents. All sums paid by Lender
pursuant to this Paragraph 9.7, and all other sums expended by Lender to which
it shall be entitled to be indemnified, together with interest thereon at the
Default Rate (as defined in the Note) from the date of such payment or
expenditure, shall constitute additions to the Indebtedness, shall be secured by
the liens, security titles, security interests and rights created by the Loan
Documents and shall be paid by Borrower to Lender upon demand.
9.8 Covenants Running with the Land. All obligations contained
in the Loan Documents are intended by the parties to be, and shall be construed
as, covenants running with the Mortgaged Property.
9.9 Successors and Assigns. All of the terms of the Loan
Documents shall apply to, be binding upon and inure to the benefit of the
parties thereto, their successors, assigns, heirs and legal representatives, and
all other persons claiming by, through or under them.
9.10 Severability. The Loan Documents are intended to be
performed in accordance with, and only to the extent permitted by, all
applicable Legal Requirements. If any provision of any of the Loan Documents or
the application thereof to any person or circumstance shall, for any reason and
to any extent, be invalid or unenforceable, then neither the remainder of the
instrument in which such provision is contained nor the application of such
provision to other persons or circumstances
39
nor the other instruments referred to hereinabove shall be affected thereby, but
rather, shall be enforced to the greatest extent permitted by law.
9.11 Entire Agreement and Modification. This Security Deed and
the other Loan Documents contain the entire agreements between the parties
relating to the subject matter hereof and thereof, and all prior agreements
relative thereto which are not contained herein or therein are terminated. The
Loan Documents may not be amended, revised, waived, discharged, released or
terminated orally, but only by a written instrument or instruments executed by
the party against which enforcement of the amendment, revision, waiver,
discharge, release or termination is asserted. Any alleged amendment, revision,
waiver, discharge, release or termination which is not so documented shall not
be effective as to any party.
9.12 Assignment. This Security Deed is assignable by Lender
and any assignment hereof by Lender shall operate to vest in the assignee all
rights and powers herein conferred upon and granted to Lender.
9.13 Time is of the Essence. Time is of the essence with
respect to each and every covenant, agreement and obligation of Borrower under
this Security Deed, the Note and any and all other Loan Documents.
9.14 Counterparts. This Security Deed may be executed in any
number of counterparts, each of which shall be an original, but all of which
together shall constitute but one instrument.
9.15 Applicable Law. This Security Deed shall be governed by
and construed according to the laws of the State of Georgia from time to time in
effect, except that United States federal law shall govern to the extent that it
permits Lender to contract for, charge or receive a greater amount of interest,
and also giving effect to all other United States federal laws applicable to
national banks. It is expressly stipulated and agreed to be the intent of
Borrower and Lender at all times to comply with applicable law now or hereafter
governing the interest payable on the Note or-the loan evidenced thereby. If the
applicable law is ever revised, repealed or judicially interpreted so as to
render usurious any amount called for under the Note or under any of the Loan
Documents, or contracted for, charged, taken, reserved or received with respect
to the Indebtedness or the Obligations, or if Lender's exercise of the option to
accelerate the maturity of the Note or if any prepayment by Borrower results in
Borrower having paid Any interest in excess of that permitted by applicable law,
then it is Borrower's and Lender's express intent that all excess amounts
theretofore collected by Lender be credited on the principal balance of the Note
(or, if the Note and all other Indebtedness or the obligations have been paid in
full, refunded to Borrower), and the provisions of the Note and the Loan
Documents immediately be deemed reformed and the amounts thereafter collectible
hereunder and thereunder reduced, without the necessity of the execution of any
new documents, so as to comply with the then applicable law, but so as to permit
the recovery of the fullest amount otherwise called for hereunder or thereunder.
All sums paid or agreed to be paid by Borrower to Lender for the use,
forbearance or detention of the Indebtedness shall, to the extent permitted by
applicable law, be amortized, prorated, allocated and spread throughout the term
of the
40
Note until payment in full so that the rate or amount of interest on account of
such Indebtedness does not exceed the usury ceiling from time to time in effect
and applicable to the Indebtedness for so long as any Indebtedness is
outstanding.
9.16 Subrogation. If any or all of the proceeds of the Note
have been used to extinguish, extend or renew any Indebtedness heretofore
existing against the Mortgaged Property, then, to the extent of such funds so
used, the Indebtedness and this Security Deed shall be subrogated to all of the
rights, claims, liens, titles and interests heretofore existing against the
Mortgaged Property to secure the indebtedness so extinguished, extended or
renewed, and the former rights, claims, liens, titles and interests, if any, are
not waived, but rather, are continued in full force and effect in favor of
Lender and are merged with the lien and security title and interest created
herein as cumulative security for the repayment of the Indebtedness and the
satisfaction of the Obligations.
9.17 Headings. The Article, Paragraph and Subparagraph
entitlements hereof are inserted for convenience of reference only and shall in
no way alter, modify or define, or be used in construing, the text of such
Articles, Paragraphs or Subparagraphs.
9.18 No Joint Venture. Notwithstanding anything in any of the
Loan Documents or in any other agreement or commitment to the contrary, neither
the Loan Documents nor the transactions described in the Loan Documents nor the
rights and obligations granted therein shall in any way create or contribute to
the creation of a partnership or joint venture or similar arrangement between
Borrower and Lender.
9.19 Inspection Fee. Following completion of the Improvements
as provided in the Loan Agreement, in furtherance of Lender's rights hereunder,
Lender may, at its option, require an inspection of the Mortgaged Property, by
an agent of Lender or any other party contracted by Lender, semi-annually.
Borrower shall pay all fees incurred by Lender for inspections of the Mortgaged
Property. Furthermore, if Lender determines in connection with any such
inspection that extra services will be required, Borrower shall pay, in addition
to the fees for such inspection, the cost of all such extra services.
9.20 Brokerage. Borrower represents and warrants to Lender
that Borrower has not dealt with any person, firm or corporation who is or may
be entitled to any finder's fee, brokerage commission, loan commission or other
sum in connection with the execution of this Security Deed, the consummation of
the transactions contemplated hereby or the making of the loan secured hereby by
Lender to Borrower, and Borrower does hereby indemnify and agree to hold Lender
harmless from and against any and all loss, liability or expense, including
court costs and reasonable attorneys fees and expenses, which Lender may suffer
or sustain should such warranty or representation prove inaccurate in whole or
in part.
9.21 CONSENT TO JURISDICTION; WAIVER OF RIGHT TO TRIAL BY
JURY. BORROWER HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF
ANY UNITED STATES FEDERAL OR STATE OF GEORGIA COURT
41
SITTING IN XXXXXX COUNTY, GEORGIA, AND HEREBY EXPRESSLY WAIVES ANY RIGHT TO
TRIAL BY JURY OF, ANY CLAIM, DEMAND, PROCEEDING ACTION OR CAUSE OF ACTION (A)
ARISING UNDER THIS SECURITY DEED, ANY OTHER LOAN DOCUMENT OR ANY OTHER
INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH
OR THEREWITH, OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE
DEALINGS OF BORROWER AND LENDER WITH RESPECT TO THIS SECURITY DEED, ANY OTHER
LOAN DOCUMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR
DELIVERED IN CONNECTION HEREWITH OR THEREWITH, OR THE TRANSACTIONS RELATED
HERETO OR THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE; AND BORROWER HEREBY AGREES
AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE
DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT LENDER MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS PARAGRAPH WITH ANY COURT AS WRITTEN EVIDENCE OF
THE CONSENT OF BORROWER TO JURISDICTION AND THE WAIVER OF ITS RIGHT TO TRIAL BY
JURY. BORROWER ACKNOWLEDGES AND AGREES THAT THE WITHIN CONSENT AND WAIVER ARE
MATERIAL INDUCEMENTS TO LENDER TO MAKE THE LOAN.
9.22 Further Stipulations. The additional covenants,
agreements and provisions set forth in Exhibit "C" hereto shall, in the event of
any conflict between such further stipulations and any of the other provisions
of this Security Deed, be deemed to control.
IN WITNESS WHEREOF, Borrower has executed this Security Deed under
seal, as of the day and year first above written.
BORROWER
Signed, sealed and delivered
in the presence of:
XXXXXXX PROPERTIES RESIDENTIAL, L.P.,
a Georgia limited partnership
/s/ Xxxxxxx X. Xxxxxxx
-----------------------------
Unofficial Witness
By: Xxxxxxx Realty Investors, Inc., a Georgia
corporation, its sole general partner
/s/ Xxxxxx Xxxxxxx
-----------------------------
Notary Public By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
------------------------------------
Commission Expiration Date: Title: _________________________________
8/19/03
-----------------------------
(CORPORATE SEAL)
(NOTARIAL SEAL)
42
EXHIBIT "A"
(Description of the Property)
(Legal Description)
All that tract or parcel of land lying and being located in Land Xxxx 000, 000,
000, & 000, 0xx Xxxxxxxx, 0xx Section, Xxxxxx County, Georgia and being more
particularly described as follows:
BEGINNING at a 1/2" rebar set, said rebar being located South 88(degree)50'38"
East, a distance of 335.79 feet along the South line of Land Lot 231 from a 3/4"
iron bar found at the common corner of Land Lots 197, 198, 230, & 231; thence
continuing along said Land Lot line South 88(degree)50'38" East, a distance of
45.92 feet to a 1/2" rebar found; thence leaving said Land Lot line North
13(degree)49'19" East, a distance of 307.12 feet to a 1/2" rebar found; thence
North 40(degree)49'28" West, a distance of 290.92 feet to a 1/2" rebar set on
the Southeast right of way (R/W) line of Xxxxx Bridge Road (R/W varies); thence
following said R/W line North 40(degree)49'28" West, a distance of 8.93 feet to
a 1/2" rebar found; thence North 49(degree)24'30" East, a distance of 269.76
feet to a point; thence an arc distance of 375.03 feet along a curve to the
right, said curve having a chord of North 49(degree)12'38" East 374.91 feet and
a radius of 4217.21 feet to a point; thence North 50(degree)41'25" East, a
distance of 284.85 feet to a 1/2" rebar set; thence leaving said R/W line South
43(degree)17'02" East, a distance of 241.60 feet to a 1/2" rebar found; thence
South 31(degree)12'02" East, a distance of 269.95 feet to a 1/2" rebar found;
thence South 43(degree)12'02" East, a distance of 169.97 feet to a 1/2" rebar
found; thence South 35(degree)12'02" East, a distance of 199.96 feet to a 1/2"
rebar found; thence South 35(degree)06'54" East, a distance of 125.15 feet to a
1/2" rebar found; thence South 22(degree)26'33" East, a distance of 160.21 feet
to a 1/2" rebar found; thence South 29(degree)19'38" East, a distance of 149.93
feet to a 1/2" rebar found; thence South 37(degree)41'40" East, a distance of
154.92 feet to a 1/2" rebar found; thence South 47(degree)58'48" East, a
distance of 164.89 feet to a 1/2" rebar found; thence South 71(degree)07'02"
West, a distance of 134.90 feet to a 1/2" rebar found; thence South
86(degree)52'02" West, a distance of 299.77 feet to a 1/2" rebar found; thence
South 79(degree)37'02" West, a distance of 124.91 feet to a 1/2" rebar found;
thence North 73(degree)51'50" West, a distance of 173.42 feet to a 1/2" rebar
set; thence South 87(degree)15'00" West, a distance of 300.00 feet to a 1/2"
rebar set; thence South 75(degree)00'00" West, a distance of 190.00 feet to a
point in a lake; thence North 65(degree)22'41" West, a distance of 207.50 feet
to a 1/2" rebar found; thence South 51(degree)09'57" West, a distance of 243.72
feet to a 1/2" rebar set; thence North 33(degree)05'48" East, a distance of
258.89 feet to a 1/2" rebar set; thence North 11(degree)54'35" West, a distance
of 33.74 feet to a 1/2" rebar set; thence North 56(degree)54'17" West, a
distance of 178.55 feet to the POINT OF BEGINNING.
Said tract contains approximately 30.524 acres as shown on a plat of that
certain ATLA/ACSM Boundary Survey prepared for Xxxxxxx Properties Residential,
L.P., First Union National Bank and Fidelity Title Insurance Company by
Rochester & Associates, Inc., bearing the seal and certification of Xxxxx X.
Xxxxx, Georgia Registered Land Surveyor No. 2298, dated January 14, 2000, last
revised May 1, 2000.
TOGETHER WITH, a non-exclusive right, title and interest in and to the easements
appurtenant to the above described Tract created pursuant to that certain
Reciprocal Easement, Restrictive Covenant and Covenant Agreement by and between
Xxxxxx County, a political subdivision of the State of Georgia, Xxxxxxx Property
Xxxxx Bridge, L.L.C., a Georgia limited liability company, and Xxxxxxx Property
Residential, L.P., a Georgia limited partnership, dated December 22, 1999, filed
for record on December 27, 1999, and recorded at Deed Book 28224, page 083,
Xxxxxx County, Georgia records.
TOGETHER WITH, a non-exclusive right, title and interest in and to the easements
appurtenant to the above described Tract created pursuant to that certain
Declaration of Easements by Xxxxxxx Properties Residential, L.P., a Georgia
limited partnership, dated October 19, 1999, filed for record on October 21,
1999, and recorded at Deed Book 27850, page 046, Xxxxxx County, Georgia records;
as amended by that certain First Amendment to Declaration of Easements by
Xxxxxxx Properties Residential, L.P., dated May 2, 2000, recorded or to be
recorded in the aforesaid records.
EXHIBIT B
(Permitted Encumbrances)
1. Taxes and assessments for the year 2000 and subsequent years, a lien
not yet due and payable; and the lien of additional real property taxes
by reason of increased or amended assessments.
2. The following matters which are disclosed on that certain Survey for
Xxxxxxx Properties Residential, L.P., Fidelity National Title Insurance
Company and First Union National Bank, prepared by Xxxxx X. Xxxxx,
Georgia Registered Land Surveyor No. 2298 of Rochester & Associates,
Inc., dated January 14, 2000, last revised May 1, 2000:
(a) 25-foot building lines located along the southerly and westerly
boundary lines of subject property;
(b) 50-foot building line located along the northwesterly boundary line
of subject property;
(c) 50-foot undisturbed buffer line located along the northeasterly and
southerly boundary lines of subject property;
(d) 10-foot development setback line along the southerly and
northeasterly boundary lines of subject property;
(e) 20-foot sanitary sewer easement and 8-inch sanitary sewer line
running through the southerly portion of subject property and
traversing the westerly and southerly boundary lines of subject
property;
(f) three (3) 36-inch corrugated metal pipes and an outlet control
structure traverses the southerly boundary line of subject property;
(g) portion of lake traverses the southerly boundary line of subject
property;
(h) portion of detention pond traverses the southerly boundary line of
subject property;
(i) encroachment of three (3) 36-inch corrugated metal pipes and an
outlet control structure across the 10-foot development setback line
along the southerly boundary of the subject property;
(j) encroachment of wooden foot bridge onto subject property across the
northeasterly boundary line of subject property which bridge is located
southwest of Xxx 00, Xxx Xxxxxx, Xxxx X;
(k) encroachment of wooden foot bridge onto subject property across the
northeasterly boundary line of subject property which bridge is located
southwest of Xxx 00, Xxx Xxxxxx, Xxxx X;
(l) encroachment of wooden foot bridge onto subject property across the
northeasterly boundary line of subject property which bridge is located
southwest of Xxx 00, Xxx Xxxxxx, Xxxx XX;
(m) encroachment of wooden foot bridge onto subject property across the
southerly boundary line of subject property which bridge is located
north of Lot 19, Abbotts Cove Subdivision;
(n) encroachment of bridge onto the subject property across the
northeasterly boundary line of subject property which bridge is located
southwest of Xxx 00, Xxx Xxxxxx, Xxxx X;
(o) encroachment of block retaining wall onto the subject property
across the northeasterly boundary line of subject property which wall
is located southwest of Xxx 00, Xxx Xxxxxx, Xxxx XX;
(p) encroachment of 6-foot wooden fence onto the subject property
across the northeasterly boundary line of subject property which fence
is located southwest of Xxxx 00 xxx 00, Xxx Xxxxxx, Xxxx XX;
(q) encroachment of playhouse onto the subject property across the
northeasterly boundary line of subject property which playhouse is
located southwest of Xxx 00, Xxx Xxxxxx, Xxxx X;
(r) gravel walkway traverses the southerly boundary line of subject
property;
(s) power and telephone line located along the northwesterly boundary
line of subject property;
(t) creek meanders along the northeasterly and southerly boundary lines
of subject property;
(u) drainage facilities running throughout the subject property;
(v) sanitary sewer lines running throughout the subject property;
(w) encroachment of sanitary sewer easement across the southerly
boundary line of subject property.
3. Right-of-Way Easement from X.X. Xxxxxx to Sawnee Electric Membership
Corporation, dated March 15, 1963, filed for record March 26, 1963, and
recorded in Deed Book 4032, page 244, aforesaid records.
4. Right-of-Way Easement from Xxxxxx X. Xxxx to Sawnee Electric Membership
Corporation, dated June 4, 1964, field for record June 26, 1964, and
recorded in Deed Book 4256, page 561, aforesaid records.
5. Right-of-Way Easement from Xxxxxxx X. Xxxx to Sawnee Electric
Membership Corporation, dated September 11, 1974, field for record
October 31, 1974, and recorded in Deed Book 6164, page 173, aforesaid
records.
6. Right-of-Way Easement from Xxxxxxx X. Xxxxx and Xxxxx X. Xxxxx to
Sawnee Electric Membership Corporation, dated August 23, 1983, filed
for record September 26, 1983, and recorded in Deed Book 8661, page
201, aforesaid records.
NOTE: A containment letter has been obtained from Sawnee Electric
Membership Corporation stating that Sawnee Electric Membership
Corporation claims no further interest in the Easements described in
Exceptions 3 through 6 hereof except the right to operate, maintain,
rebuild and renew its existing facilities within its presently
maintained rights of way.
7. Floor Plain Indemnification from Xxxxxxx Properties Residential, L.P.
in favor of Xxxxxx County, dated August 18, 1998, filed August 19,
1998, recorded in Deed Book 24983, page 330, aforesaid records.
8. Declaration of Easements by Xxxxxxx Properties Residential, L.P., dated
October 19, 1999, filed October 21, 1999, recorded in Deed Book 27850,
page 046, aforesaid records; as amended by that certain First Amendment
to Declaration of Easements by Xxxxxxx Properties Residential, L.P.,
dated May 2, 2000, recorded or to be recorded in the aforesaid records.
9. Reciprocal Easement, Restrictive Covenant and Covenant Agreement among
Xxxxxx County, Xxxxxxx Properties Xxxxx Bridge, L.L.C. and Xxxxxxx
Properties Residential, L.P., dated December 22, 1999, recorded in Deed
Book 28224, page 83, aforesaid records; as affected by Affidavit
deposed by Xxxxx X. Xxxxxxxx, dated February 3, 2000, recorded in Deed
Book 28576, page 325, aforesaid records.
10. Grant of Easements from Xxxxxxx Properties Residential, L.P. to Xxxxxxx
Properties Xxxxx Bridge, L.L.C., dated May 2, 2000, recorded or to be
recorded in the aforesaid records.
11. Right-of-Way Easement from Xxxxxxx Properties Residential, L.P. to
Sawnee Electric Membership Corporation, dated February 5, 1999, filed
April 26, 1999, recorded in Deed Book 26823, page 85, aforesaid
records. (Affects only areas encumbered by either of the two easements
appurtenant to the Phase II Property).
NOTE: A containment letter has been obtained from Sawnee Electric
Membership Corporation stating that Sawnee Electric Membership
Corporation claims no further interest in the Easements described in
Exception 11 hereof except the right to operate, maintain, rebuild and
renew its existing facilities within its presently maintained rights of
way.
12. Easement contained in that certain Right-of-Way Deed from Xxxxxxx
Properties Residential, L.P. to Xxxxxx County, dated August 18, 1998,
filed September 21, 1998, recorded in Deed Book 25219, page 141,
aforesaid records. (Affects Appurtenant Easement only).
13. Rights of tenants in possession of individual apartment units under
unrecorded leases, as tenants only. (Affects Appurtenant Easement
only).
14. All matters shown on Plat of Survey for Xxxxxxx Properties Residential,
L.P. and Fidelity National Title Insurance Company by Xxxxxx Xxxxx &
Goulding, bearing the seal and certification of Xxxxxxx X. Xxxxxxx,
Georgia Registered Professional Land Surveyor No. 2351, dated September
23, 1999, last revised October 19, 1999, and all matters subsequent to
October 19, 1999 which may be disclosed by a current and accurate
survey and inspection of the subject property. (Affects only areas
encumbered by either of the two easements appurtenant to the Phase II
Property).
15. Rights of upper and lower riparian owners in and to the waters of
lakes, rivers, creeks or branches crossing or adjoining the subject
property, and the natural flow thereof, free from diminution or
pollution.
EXHIBIT "C"
FURTHER STIPULATIONS
1. Attorney's Fees. Whenever reference is made to the payment of "attorneys'
fees," "reasonable attorney's fees" or words of similar import in this Security
Deed and the Note, the Construction Loan Agreement and the other loan documents,
the same shall mean and refer to the payment of actual attorney's fees incurred
based upon the attorney's normal hourly rate and the number of hours worked, and
not the statutory attorney's fees defined in O.C.G.A.ss.13-1-11.
