Exhibit 99.8
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BEHRINGER HARVARD XXXXXX COMMONS, LLC,
a Delaware limited liability company as Borrower
(Borrower)
to
MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC.,
a Delaware corporation, as nominee of Lender
(Lender)
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MORTGAGE AND
SECURITY AGREEMENT
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Dated: As of July _27, 2005
Location: Xxxxxx Commons, St. Xxxx, Minnesota
County: Ramsey
MERS MIN: 8000101-0000001664-1
DOCUMENT PREPARED BY AND WHEN RECORDED, RETURN TO:
Xxxxxx Xxxx & Xxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxx, Esq.
NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, ENFORCEMENT OF THIS MORTGAGE IS
LIMITED TO A DEBT AMOUNT OF $58,300,000.00 UNDER CHAPTER 287 OF MINNESOTA
STATUTES, NOT INCLUDING ACCRUED INTEREST, AMOUNTS EXPENDED BY THE MORTGAGEE TO
PROTECT AND PRESERVE THE MORTGAGEE'S COLLATERAL HEREUNDER, ATTORNEYS FEES AND
OTHER FEES AND COSTS OF COLLECTION, AND ANY OTHER AMOUNTS ALLOWED BY THE LAWS OF
THE STATE OF MINNESOTA.
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MORTGAGE AND SECURITY AGREEMENT
THIS MORTGAGE AND SECURITY AGREEMENT (this "Mortgage") is made as of
this 27th day of July, 2005, by BEHRINGER HARVARD XXXXXX COMMONS, LLC, a
Delaware limited liability company, having its principal place of business c/o
Behringer Harvard Funds, 00000 Xxxxxx Xxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000,
as mortgagor ("Borrower") for the benefit of MORTGAGE ELECTRONIC REGISTRATION
SYSTEMS, INC., a Delaware corporation, having an address at 0000 Xxxxxx Xxxx
Xxxx, Xxxxx 000, Xxxxxx, Xxxxxxxx 00000 ("MERS"), as nominee of BEAR XXXXXXX
COMMERCIAL MORTGAGE, INC., a New York corporation, having an address at 000
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, as mortgagee ("Lender").
W I T N E S S E T H:
WHEREAS, this Mortgage is given to secure a loan (the "Loan") in the
principal sum of Fifty-Eight Million Three Hundred Thousand and No/100 Dollars
($58,300,000.00) advanced pursuant to that certain Loan Agreement, dated as of
the date hereof, between Borrower and Lender (as the same may hereafter be
amended, restated, replaced, supplemented, renewed, extended or otherwise
modified from time to time, the "Loan Agreement") and evidenced by that certain
Promissory Note, dated the date hereof, made by Borrower in favor of MERS, as
nominee of Lender (as the same may hereafter be amended, restated, replaced,
supplemented, renewed, extended or otherwise modified from time to time, the
"Note");
WHEREAS, Borrower desires to secure the payment of the Debt (as defined
in the Loan Agreement) and the performance of all of its obligations under the
Note, the Loan Agreement and the other Loan Documents (as herein defined); and
WHEREAS, this Mortgage is given pursuant to the Loan Agreement, and
payment, fulfillment, and performance by Borrower of its obligations thereunder
and under the other Loan Documents are secured hereby, and each and every term
and provision of the Loan Agreement, the Note, and that certain Assignment of
Leases and Rents of even date herewith made by Borrower in favor of MERS, as
nominee of Lender, delivered in connection with this Deed of Trust (as the same
may be amended, restated, replaced, supplemented, renewed, extended or otherwise
modified from time to time, the "Assignment of Leases"), including the rights,
remedies, obligations, covenants, conditions, agreements, indemnities,
representations and warranties of the parties therein, are hereby incorporated
by reference herein as though set forth in full and shall be considered a part
of this Mortgage (the Loan Agreement, the Note, this Mortgage, the Assignment of
Leases and Rents and all other documents evidencing or securing the Debt
(including all additional mortgages, deeds to secure debt and assignments of
leases and rents) or pursuant to which any Person incurs, has incurred or
assumes any obligation to or for the benefit of Lender in connection therewith,
are hereinafter referred to collectively as the "Loan Documents").
NOW THEREFORE, in consideration of the making of the Loan by Lender and
the covenants, agreements, representations and warranties set forth in this
Mortgage:
ARTICLE 1 - GRANTS OF SECURITY
SECTION 1.1 PROPERTY MORTGAGED. Borrower does hereby irrevocably
mortgage, grant, bargain, sell, pledge, assign, warrant, transfer and convey to
MERS, as nominee of Lender and its successors and assigns, all of Borrower's
right, title and interest in, to and under the following property, rights,
interests and estates now owned, or hereafter acquired by Borrower
(collectively, the "Property"):
(a) LAND. The real property described in EXHIBIT A attached
hereto and made a part hereof (the "Land");
(b) ADDITIONAL LAND. All xxxxxxxxxx xxxxx, xxxxxxx and
development rights hereafter acquired by Borrower for use in connection with the
Land and the development of the Land and all additional lands and estates
therein which may, from time to time, by supplemental mortgage or otherwise be
expressly made subject to the lien of this Mortgage;
(c) IMPROVEMENTS. The buildings, structures, fixtures,
additions, enlargements, extensions, modifications, repairs, replacements and
improvements now or hereafter erected or located on the Land (collectively, the
"Improvements");
(d) EASEMENTS. All easements, rights-of-way or use, rights,
strips and gores of land, streets, ways, alleys, passages, sewer rights, water,
water courses, water rights and powers, air rights and development rights, and
all estates, rights, titles, interests, privileges, liberties, servitudes,
tenements, hereditaments and appurtenances of any nature whatsoever, in any way
now or hereafter belonging, relating or pertaining to the Land and the
Improvements and the reversions and remainders, and all land lying in the bed of
any street, road or avenue, opened or proposed, in front of or adjoining the
Land, to the center line thereof and all the estates, rights, titles, interests,
rights of dower, rights of curtesy, property, possession, claim and demand
whatsoever, both at law and in equity, of Borrower of, in and to the Land and
the Improvements and every part and parcel thereof, with the appurtenances
thereto;
(e) EQUIPMENT. All "equipment," as such term is defined in
Article 9 of the Uniform Commercial Code (as hereinafter defined), now owned or
hereafter acquired by Borrower, which is used at or in connection with the
Improvements or the Land or is located thereon or therein (including, but not
limited to, all machinery, equipment, furnishings, and electronic
data-processing and other office equipment now owned or hereafter acquired by
Borrower and used at the Improvements or the Land and any and all additions,
substitutions and replacements of any of the foregoing), together with all
attachments, components, parts, equipment and accessories installed thereon or
affixed thereto (collectively, the "Equipment"). Notwithstanding the foregoing,
Equipment shall not include any property belonging to tenants under leases
except to the extent that Borrower shall have any right or interest therein;
(f) FIXTURES. All Equipment now owned, or the ownership of
which is hereafter acquired, by Borrower which is so related to the Land and
Improvements forming part of the Property that it is deemed fixtures or real
property under the law of the particular state in which the Land is located,
including, without limitation, all building or construction materials intended
for construction, reconstruction, alteration or repair of or installation on the
Property,
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construction equipment, appliances, machinery, plant equipment, fittings,
apparatuses, fixtures and other items now or hereafter attached to, installed in
or used in connection with (temporarily or permanently) any of the Improvements
or the Land, including, but not limited to, engines, devices for the operation
of pumps, pipes, plumbing, call and sprinkler systems, fire extinguishing
apparatuses and equipment, heating, ventilating, incinerating, electrical, air
conditioning and air cooling equipment and systems, gas and electric machinery,
appurtenances and equipment, pollution control equipment, security systems,
disposals, dishwashers, refrigerators and ranges, recreational equipment and
facilities of all kinds, and water, gas, electrical, storm and sanitary sewer
facilities, utility lines and equipment (whether owned individually or jointly
with others, and, if owned jointly, to the extent of Borrower's interest
therein) and all other utilities whether or not situated in easements, all water
tanks, water supply, water power sites, fuel stations, fuel tanks, fuel supply,
and all other structures, together with all accessions, appurtenances,
additions, replacements, betterments and substitutions for any of the foregoing
and the proceeds thereof (collectively, the "Fixtures"). Notwithstanding the
foregoing, "Fixtures" shall not include any property which tenants are entitled
to remove pursuant to leases except to the extent that Borrower shall have any
right or interest therein;
(g) PERSONAL PROPERTY. All furniture, furnishings, objects
of art, machinery, goods, tools, supplies, appliances, general intangibles,
contract rights, accounts, accounts receivable, franchises, licenses,
certificates and permits, and all other personal property of any kind or
character whatsoever as defined in and subject to the provisions of the Uniform
Commercial Code, whether tangible or intangible, other than Fixtures, which are
now or hereafter owned by Borrower and which are located within or about the
Land and the Improvements, together with all accessories, replacements and
substitutions thereto or therefor and the proceeds thereof (collectively, the
"Personal Property"), and the right, title and interest of Borrower in and to
any of the Personal Property which may be subject to any security interests, as
defined in the Uniform Commercial Code, as adopted and enacted by the state or
states where any of the Property is located (the "Uniform Commercial Code"),
superior in lien to the lien of this Mortgage and all proceeds and products of
the above;
(h) LEASES AND RENTS. All leases, subleases or subsubleases,
lettings, licenses, concessions or other agreements (whether written or oral)
pursuant to which any Person is granted a possessory interest in, or right to
use or occupy all or any portion of the Land and the Improvements, and every
modification, amendment or other agreement relating to such leases, subleases,
subsubleases, or other agreements entered into in connection with such leases,
subleases, subsubleases, or other agreements and every guarantee of the
performance and observance of the covenants, conditions and agreements to be
performed and observed by the other party thereto, heretofore or hereafter
entered into (collectively, the "Leases"), whether before or after the filing by
or against Borrower of any petition for relief under the Bankruptcy Code and all
right, title and interest of Borrower, its successors and assigns therein and
thereunder, including, without limitation, cash or securities deposited
thereunder to secure the performance by the lessees of their obligations
thereunder and all rents, additional rents, revenues, issues and profits
(including all oil and gas or other mineral royalties and bonuses) from the Land
and the Improvements whether paid or accruing before or after the filing by or
against Borrower of any petition for relief under the Bankruptcy Code
(collectively, the "Rents") and all proceeds from the sale or other disposition
of the Leases and the right to receive and apply the Rents to the payment of the
Debt;
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(i) CONDEMNATION AWARDS. All Awards, including interest
thereon, which may heretofore and hereafter be made with respect to the
Property, whether from the exercise of the right of eminent domain (including,
but not limited to, any transfer made in lieu of or in anticipation of the
exercise of the right), or for a change of grade, or for any other injury to or
decrease in the value of the Property;
(j) INSURANCE PROCEEDS. All Insurance Proceeds in respect of
the Property under any Policies covering the Property, including, without
limitation, the right to receive and apply the proceeds of any Policies,
judgments, or settlements made in lieu thereof, in connection with a Casualty to
the Property;
(k) TAX CERTIORARI. All refunds, rebates or credits in
connection with reduction in Taxes of Other Charges charged against the Property
as a result of tax certiorari or any applications or proceedings for reduction;
(l) CONVERSION. All proceeds of the conversion, voluntary or
involuntary, of any of the foregoing including, without limitation, Insurance
Proceeds and Awards, into cash or liquidation claims;
(m) RIGHTS. The right, in the name and on behalf of
Borrower, to appear in and defend any action or proceeding brought with respect
to the Property and to commence any action or proceeding to protect the interest
of Lender in the Property;
(n) AGREEMENTS. All agreements, contracts, certificates,
instruments, franchises, permits, licenses, plans, specifications and other
documents, now or hereafter entered into, and all rights therein and thereto,
respecting or pertaining to the use, occupation, construction, management or
operation of the Land and any part thereof and any Improvements or any business
or activity conducted on the Land and any part thereof and all right, title and
interest of Borrower therein and thereunder, including, without limitation, the
right, upon the happening of any default hereunder, to receive and collect any
sums payable to Borrower thereunder;
(o) TRADEMARKS. All tradenames, trademarks, servicemarks,
logos, copyrights, goodwill, books and records and all other general intangibles
relating to or used in connection with the operation of the Property;
(p) ACCOUNTS. All reserves, escrows and deposit accounts
maintained by Borrower with respect to the Property, including, without
limitation (i) all accounts established pursuant to the Cash Management
Agreement and (ii) all accounts established pursuant to the Lockbox Agreement;
together with all deposits or wire transfers made to the Lockbox Account or Cash
Management Account and all cash, checks, drafts, certificates, securities,
investment property, financial assets, instruments and other property held
therein from time to time and all proceeds, products, distributions or dividends
or substitutions thereon and thereof; and
(q) OTHER RIGHTS. Any and all other rights of Borrower in
and to the items set forth in Subsections (a) through (p) above.
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AND without limiting any of the other provisions of this Mortgage, to
the extent permitted by applicable law, Borrower expressly grants to MERS, as
nominee of Lender, as secured party, a security interest in the portion of the
Property which is or may be subject to the provisions of the Uniform Commercial
Code which are applicable to secured transactions; it being understood and
agreed that the Improvements and Fixtures are part and parcel of the Land (the
Land, the Improvements and the Fixtures collectively referred to as the "Real
Property") appropriated to the use thereof and, whether affixed or annexed to
the Real Property or not, shall for the purposes of this Mortgage be deemed
conclusively to be real estate and mortgaged hereby.
SECTION 1.2 ASSIGNMENT OF RENTS. Borrower hereby absolutely and
unconditionally assigns to MERS, as nominee of Lender all of Borrower's right,
title and interest in and to all current and future Leases and Rents; it being
intended by Borrower that this assignment constitutes a present, absolute
assignment and not an assignment for additional security only. Nevertheless,
subject to the terms of the Assignment of Leases, the Cash Management Agreement
and Section 7.1(h) of this Mortgage, Lender grants to Borrower a revocable
license to collect, receive, use and enjoy the Rents and Borrower shall hold the
Rents, or a portion thereof sufficient to discharge all current sums due on the
Debt, for use in the payment of such sums.
SECTION 1.3 SECURITY AGREEMENT. This Mortgage is both a real
property mortgage and a "security agreement" within the meaning of the Uniform
Commercial Code. The Property includes both real and personal property and all
other rights and interests, whether tangible or intangible in nature, of
Borrower in the Property. By executing and delivering this Mortgage, Borrower
hereby grants to MERS, as nominee of Lender, as security for the Obligations
(hereinafter defined), a security interest in the Fixtures, the Equipment and
the Personal Property to the full extent that the Fixtures, the Equipment and
the Personal Property may be subject to the Uniform Commercial Code (said
portion of the Property so subject to the Uniform Commercial Code being called
the "Collateral"). If an Event of Default shall occur and be continuing, Lender,
in addition to any other rights and remedies which it may have, shall have and
may exercise immediately and without demand, any and all rights and remedies
granted to a secured party upon default under the Uniform Commercial Code,
including, without limiting the generality of the foregoing, the right to take
possession of the Collateral or any part thereof, and to take such other
measures as Lender may deem necessary for the care, protection and preservation
of the Collateral. Upon request or demand of Lender after the occurrence and
during the continuance of an Event of Default, Borrower shall, at its expense,
assemble the Collateral and make it available to Lender at a convenient place
(at the Land if tangible property) reasonably acceptable to Lender. Borrower
shall pay to Lender on demand any and all expenses, including reasonable legal
expenses and attorneys' fees, incurred or paid by Lender in protecting its
interest in the Collateral and in enforcing its rights hereunder with respect to
the Collateral after the occurrence and during the continuance of an Event of
Default. Any notice of sale, disposition or other intended action by Lender with
respect to the Collateral sent to Borrower in accordance with the provisions
hereof at least ten (10) Business Days prior to such action, shall, except as
otherwise provided by applicable law, constitute reasonable notice to Borrower.
The proceeds of any disposition of the Collateral, or any part thereof, may,
except as otherwise required by applicable law, be applied by Lender to the
payment of the Debt in such priority and proportions as Lender in its discretion
shall deem proper. Borrower's (debtor's) principal place
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of business is as set forth on page one hereof and the address of Lender
(secured party) is as set forth on page one hereof. Borrower's organizational ID
no. is 00-0000000.
SECTION 1.4 FIXTURE FILING. Certain of the Property is or will
become "fixtures" (as that term is defined in the Uniform Commercial Code) on
the Land, and this Mortgage, upon being filed for record in the real estate
records of the city or county wherein such fixtures are situated, shall operate
also as a financing statement filed as a fixture filing in accordance with the
applicable provisions of said Uniform Commercial Code upon such of the Property
that is or may become fixtures.
SECTION 1.5 PLEDGES OF MONIES HELD. Borrower hereby pledges to
Lender any and all monies now or hereafter held by Lender or on behalf of
Lender, including, without limitation, any sums deposited in the Lockbox
Account, the Cash Management Account, the Reserve Funds and Net Proceeds, as
additional security for the Obligations until expended or applied as provided in
this Mortgage.
SECTION 1.6 Grants to MERS. This Mortgage and the grants,
assignments and transfers made to MERS in this Article 1 shall inure to MERS
solely in its capacity as Lender's nominee.
CONDITIONS TO GRANT
TO HAVE AND TO HOLD the above granted and described Property unto and to
the use and benefit of Lender and its successors and assigns, forever;
PROVIDED, HOWEVER, these presents are upon the express condition that,
if Borrower shall well and truly pay to Lender the Debt at the time and in the
manner provided in the Note, the Loan Agreement and this Mortgage, shall well
and truly perform the Other Obligations as set forth in this Mortgage and shall
well and truly abide by and comply with each and every covenant and condition
set forth herein and in the Note, the Loan Agreement and the other Loan
Documents, these presents and the estate hereby granted shall cease, terminate
and be void; provided, however, that Borrower's obligation to indemnify and hold
harmless Lender pursuant to the provisions hereof shall survive any such payment
or release.
ARTICLE 2 - DEBT AND OBLIGATIONS SECURED
SECTION 2.1 DEBT. This Mortgage and the grants, assignments and
transfers made in Article I are given for the purpose of securing the Debt.
SECTION 2.2 OTHER OBLIGATIONS. This Mortgage and the grants,
assignments and transfers made in Article I are also given for the purpose of
securing the following (the "Other Obligations"):
(a) the performance of all other obligations of Borrower
contained herein;
(b) the performance of each obligation of Borrower contained
in the Loan Agreement and any other Loan Document; and
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(c) the performance of each obligation of Borrower contained
in any renewal, extension, amendment, modification, consolidation, change of, or
substitution or replacement for, all or any part of the Note, the Loan Agreement
or any other Loan Document.
SECTION 2.3 DEBT AND OTHER OBLIGATIONS. Borrower's obligations for
the payment of the Debt and the performance of the Other Obligations shall be
referred to collectively herein as the "Obligations."
ARTICLE 3 - BORROWER COVENANTS
Borrower covenants and agrees that:
SECTION 3.1 PAYMENT OF DEBT. Borrower will pay the Debt at the time
and in the manner provided in the Loan Agreement, the Note and this Mortgage.
SECTION 3.2 INCORPORATION BY REFERENCE. All the covenants,
conditions and agreements contained in (a) the Loan Agreement, (b) the Note and
(c) all and any of the other Loan Documents, are hereby made a part of this
Mortgage to the same extent and with the same force as if fully set forth
herein.
SECTION 3.3 INSURANCE. Borrower shall obtain and maintain, or cause
to be maintained, in full force and effect at all times insurance with respect
to Borrower and the Property as required pursuant to the Loan Agreement.
SECTION 3.4 MAINTENANCE OF PROPERTY. Borrower shall cause the
Property to be maintained in a good and safe condition and repair. The
Improvements, the Fixtures, the Equipment and the Personal Property shall not be
removed, demolished or materially altered (except for normal replacement of the
Fixtures, the Equipment or the Personal Property, tenant finish and
refurbishment of the Improvements and for the disposal of Fixtures, Equipment or
Personal Property not material to the use or value of the Property as an office
building) without the consent of Lender. Borrower shall promptly repair, replace
or rebuild any part of the Property which may be destroyed by any Casualty or
become damaged, worn or dilapidated or which may be affected by any
Condemnation, and shall complete and pay for any structure at any time in the
process of construction or repair on the Land.
SECTION 3.5 WASTE. Borrower shall not commit or suffer any waste of
the Property or make any change in the use of the Property which will in any way
materially increase the risk of fire or other hazard arising out of the
operation of the Property, or take any action that might invalidate or allow the
cancellation of any Policy, or do or permit to be done thereon anything that may
in any way materially impair the value of the Property or the security of this
Mortgage. Borrower will not, without the prior written consent of Lender, permit
any drilling or exploration for or extraction, removal, or production of any
minerals from the surface or the subsurface of the Land, regardless of the depth
thereof or the method of mining or extraction thereof.
SECTION 3.6 PAYMENT FOR LABOR AND MATERIALS.
(a) Subject to Section 3.6(b), Borrower will promptly pay
when due all bills and costs for labor, materials, and specifically fabricated
materials ("Labor and Material
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Costs") incurred in connection with the Property and never permit to exist
beyond the due date thereof in respect of the Property or any part thereof any
lien or security interest, even though inferior to the liens and the security
interests hereof, and in any event never permit to be created or exist in
respect of the Property or any part thereof any other or additional lien or
security interest other than the liens or security interests hereof except for
the Permitted Encumbrances and other Liens permitted pursuant to the Loan
Documents.
(b) After prior written notice to Lender, Borrower, at its
own expense, may contest by appropriate legal proceeding, promptly initiated and
conducted in good faith and with due diligence, the amount or validity or
application in whole or in part of any of the Labor and Material Costs, provided
that (i) no Event of Default has occurred and is continuing under the Loan
Agreement, the Note, this Mortgage or any of the other Loan Documents, (ii)
Borrower is permitted to do so under the provisions of any other mortgage, deed
of trust or deed to secure debt affecting the Property, (iii) such proceeding
shall suspend the collection of the Labor and Material Costs from Borrower and
from the Property or Borrower shall have paid all of the Labor and Material
Costs (or such portion thereof as to which collection is not suspended) under
protest, (iv) such proceeding shall be permitted under and be conducted in
accordance with the provisions of any other instrument to which Borrower is
subject and shall not constitute a default thereunder, (v) neither the Property
nor any part thereof or interest therein will be in immediate danger of being
sold, forfeited, terminated, canceled or lost, and (vi) Borrower shall have
furnished the security as may be required in the proceeding, or as may be
reasonably requested by Lender to insure the payment of any contested Labor and
Material Costs, together with all interest and penalties thereon.
SECTION 3.7 PERFORMANCE OF OTHER AGREEMENTS. Borrower shall observe
and perform each and every term, covenant and provision to be observed or
performed by Borrower pursuant to the Loan Agreement, any other Loan Document
and any other agreement or recorded instrument affecting or pertaining to the
Property and any amendments, modifications or changes thereto.
SECTION 3.8 CHANGE OF NAME, IDENTITY OR STRUCTURE. Borrower shall
not change Borrower's name, identity (including its trade name or names) or, if
not an individual, Borrower's corporate, partnership or other structure without
notifying Lender of such change in writing at least thirty (30) days prior to
the effective date of such change and, in the case of a change in Borrower's
structure, without first obtaining the prior written consent of Lender. Borrower
shall execute and deliver to Lender, prior to or contemporaneously with the
effective date of any such change, any financing statement or financing
statement change required by Lender to establish or maintain the validity,
perfection and priority of the security interest granted herein. At the request
of Lender, Borrower shall execute a certificate in form satisfactory to Lender
listing the trade names under which Borrower intends to operate the Property,
and representing and warranting that Borrower does business under no other trade
name with respect to the Property.
SECTION 3.9 TITLE. Borrower has good, marketable and insurable fee
simple title to the real property comprising part of the Property and good title
to the balance of such Property, free and clear of all Liens (as defined in the
Loan Agreement) whatsoever except the Permitted Encumbrances (as defined in the
Loan Agreement), such other Liens as are permitted pursuant to
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the Loan Documents and the Liens created by the Loan Documents. The Permitted
Encumbrances in the aggregate do not materially and adversely affect the value,
operation or use of the Property or Borrower's ability to repay the Loan. This
Mortgage, when properly recorded in the appropriate records, together with any
Uniform Commercial Code financing statements required to be filed in connection
therewith, will create (a) a valid, perfected first priority lien on that
portion of the Property constituting interests in real estate, subject only to
Permitted Encumbrances and the Liens created by the Loan Documents and (b) to
the extent that a security interest therein may be perfected by the filing of
financing statements under the Uniform Commercial Code, perfected security
interests in and to, and perfected collateral assignments of, all personalty
(including, to the extent that they constitute personalty subject to the Uniform
Commercial Code, the Leases), all in accordance with the terms thereof, in each
case subject only to any applicable Permitted Encumbrances, such other Liens as
are permitted pursuant to the Loan Documents and the Liens created by the Loan
Documents. There are no claims for payment for work, labor or materials
affecting the Property which are past due and are or may become a lien prior to,
or of equal priority with, the Liens created by the Loan Documents unless such
claims for payments are being contested in accordance with the terms and
conditions of this Mortgage.
SECTION 3.10 PARTITION. Notwithstanding anything to the contrary
contained herein, for so long as the Loan is outstanding Borrower shall not
bring an action for partition with respect to such Borrower's ownership interest
in the Property or to compel any sale thereof and each Borrower hereby expressly
waives any and all rights to partition the Property.
ARTICLE 4 - OBLIGATIONS AND RELIANCES
SECTION 4.1 RELATIONSHIP OF BORROWER AND LENDER. The relationship
between Borrower and Lender is solely that of debtor and creditor, and Lender
has no fiduciary or other special relationship with Borrower, and no term or
condition of the Loan Agreement, the Note, this Mortgage and the other Loan
Documents shall be construed so as to deem the relationship between Borrower and
Lender to be other than that of debtor and creditor.
SECTION 4.2 NO RELIANCE ON LENDER. The general partners, members,
principals and (if Borrower is a trust) beneficial owners of Borrower are
experienced in the ownership and operation of properties similar to the
Property, and Borrower and Lender are relying solely upon such expertise and
business plan in connection with the ownership and operation of the Property.
Borrower is not relying on Lender's expertise, business acumen or advice in
connection with the Property.
SECTION 4.3 NO LENDER OBLIGATIONS.
(a) Notwithstanding the provisions of Subsections 1.1(h) and
(n) or Section 1.2, Lender is not undertaking the performance of (i) any
obligations under the Leases; or (ii) any obligations with respect to such
agreements, contracts, certificates, instruments, franchises, permits,
trademarks, licenses and other documents.
(b) By accepting or approving anything required to be
observed, performed or fulfilled or to be given to Lender pursuant to this
Mortgage, the Loan Agreement,
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the Note or the other Loan Documents, including, without limitation, any
Officer's Certificate, balance sheet, statement of profit and loss or other
financial statement, survey, appraisal, or Policy, Lender shall not be deemed to
have warranted, consented to, or affirmed the sufficiency, the legality or
effectiveness of same, and such acceptance or approval thereof shall not
constitute any warranty or affirmation with respect thereto by Lender.
SECTION 4.4 RELIANCE. Borrower recognizes and acknowledges that in
accepting the Loan Agreement, the Note, this Mortgage and the other Loan
Documents, Lender is expressly and primarily relying on the truth and accuracy
of the warranties and representations set forth in Section 4.1 of the Loan
Agreement without any obligation to investigate the Property and notwithstanding
any investigation of the Property by Lender; that such reliance existed on the
part of Lender prior to the date hereof, that the warranties and representations
are a material inducement to Lender in making the Loan; and that Lender would
not be willing to make the Loan and accept this Mortgage in the absence of the
warranties and representations as set forth in Section 4.1 of the Loan
Agreement.
ARTICLE 5 - FURTHER ASSURANCES
SECTION 5.1 RECORDING OF MORTGAGE, ETC. Borrower forthwith upon the
execution and delivery of this Mortgage and thereafter, from time to time upon
Lender's request, will cause this Mortgage and any of the other Loan Documents
creating a lien or security interest or evidencing the lien hereof upon the
Property and each instrument of further assurance to be filed, registered or
recorded in such manner and in such places as may be required by any present or
future law in order to publish notice of and fully to protect and perfect the
lien or security interest hereof upon, and the interest of Lender in, the
Property. Borrower will pay all taxes, filing, registration or recording fees,
and all expenses incident to the preparation, execution, acknowledgment and/or
recording of the Note, this Mortgage, the other Loan Documents, any note, deed
of trust or mortgage supplemental hereto, any security instrument with respect
to the Property and any instrument of further assurance, and any modification or
amendment of the foregoing documents, and all federal, state, county and
municipal taxes, duties, imposts, assessments and charges arising out of or in
connection with the execution and delivery of this Mortgage, any deed of trust
or mortgage supplemental hereto, any security instrument with respect to the
Property or any instrument of further assurance, and any modification or
amendment of the foregoing documents, except where prohibited by law so to do.
SECTION 5.2 FURTHER ACTS, ETC. Borrower will, at the cost of
Borrower, and without expense to Lender, do, execute, acknowledge and deliver
all and every further acts, deeds, conveyances, deeds of trust, mortgages,
assignments, notices of assignments, transfers and assurances as Lender shall,
from time to time, reasonably require, for the better assuring, conveying,
assigning, transferring, and confirming unto Lender the property and rights
hereby mortgaged, deeded, granted, bargained, sold, conveyed, confirmed,
pledged, assigned, warranted and transferred or intended now or hereafter so to
be, or which Borrower may be or may hereafter become bound to convey or assign
to Lender, or for carrying out the intention or facilitating the performance of
the terms of this Mortgage or for filing, registering or recording this
Mortgage, or for complying with all Legal Requirements. Borrower, on demand,
will execute and deliver, and in the event it shall fail to so execute and
deliver, hereby authorizes Lender to execute in the name of Borrower or without
the signature of Borrower to the extent
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Lender may lawfully do so, one or more financing statements to evidence more
effectively the security interest of Lender in the Property. Borrower grants to
Lender an irrevocable power of attorney coupled with an interest for the purpose
of exercising and perfecting any and all rights and remedies available to Lender
at law and in equity, including without limitation, such rights and remedies
available to Lender pursuant to this Section 5.2.
SECTION 5.3 CHANGES IN TAX, DEBT, CREDIT AND DOCUMENTARY STAMP LAWS.
(a) If any law is enacted or adopted or amended after the
date of this Mortgage which deducts the Debt from the value of the Property for
the purpose of taxation or which imposes a tax, either directly or indirectly,
on the Debt or Lender's interest in the Property (other than the inclusion of
such amounts as income for income tax purposes or taxes on Lender's capital),
Borrower will pay the tax, with interest and penalties thereon, if any. If
Lender is advised by counsel chosen by it that the payment of tax by Borrower
would be unlawful or taxable to Lender or unenforceable or provide the basis for
a defense of usury then Lender shall have the option by written notice of not
less than one hundred twenty (120) days to declare the Debt immediately due and
payable. If so accelerated, Borrower shall repay the Loan without premium or
penalty.
(b) Borrower will not claim or demand or be entitled to any
credit or credits on account of the Debt for any part of the Taxes or Other
Charges assessed against the Property, or any part thereof, and no deduction
shall otherwise be made or claimed from the assessed value of the Property, or
any part thereof, for real estate tax purposes by reason of this Mortgage or the
Debt. If such claim, credit or deduction shall be required by law, Lender shall
have the option, by written notice of not less than one hundred twenty (120)
days, to declare the Debt immediately due and payable. If so accelerated,
Borrower shall repay the Loan without premium or penalty.
(c) If at any time the United States of America, any State
thereof or any subdivision of any such State shall require revenue or other
stamps to be affixed to the Note, this Mortgage, or any of the other Loan
Documents or impose any other tax or charge on the same, Borrower will pay for
the same, with interest and penalties thereon, if any.
SECTION 5.4 SEVERING OF MORTGAGE. This Mortgage and the Note shall,
at any time until the same shall be fully paid and satisfied, at the sole
election of Lender, be severed into two or more notes and two or more security
instruments in such denominations as Lender shall determine in its sole
discretion, each of which shall cover all or a portion of the Property to be
more particularly described therein. To that end, Borrower, upon written request
of Lender, shall execute, acknowledge and deliver, or cause to be executed,
acknowledged and delivered by the then owner of the Property, to Lender and/or
its designee or designees substitute notes and security instruments in such
principal amounts, aggregating not more than the then unpaid principal amount of
this Mortgage, and containing terms, provisions and clauses similar to, and no
more onerous to Borrower than, those contained herein and in the Note, and such
other documents and instruments as may be required by Lender; provided that
Borrower's obligations are not materially increased thereby.
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SECTION 5.5 REPLACEMENT DOCUMENTS. Upon receipt of an affidavit of
an officer of Lender as to the loss, theft, destruction or mutilation of the
Note or any other Loan Document which is not of public record, and, in the case
of any such mutilation, upon surrender and cancellation of such Note or other
Loan Document, Borrower will issue, in lieu thereof, a replacement Note or other
Loan Document, dated the date of such lost, stolen, destroyed or mutilated Note
or other Loan Document in the same principal amount thereof and otherwise of
like tenor.
ARTICLE 6 - DUE ON SALE/ENCUMBRANCE
SECTION 6.1 LENDER RELIANCE. Borrower acknowledges that Lender has
examined and relied on the experience of Borrower and its general partners,
members, principals and (if Borrower is a trust) beneficial owners in owning and
operating properties such as the Property in agreeing to make the Loan, and will
continue to rely on Borrower's ownership of the Property as a means of
maintaining the value of the Property as security for repayment of the Debt and
the performance of the Other Obligations. Borrower acknowledges that Lender has
a valid interest in maintaining the value of the Property so as to ensure that,
should Borrower default in the repayment of the Debt or the performance of the
Other Obligations, Lender can recover the Debt by a sale of the Property.
SECTION 6.2 NO SALE/ENCUMBRANCE. Neither Borrower nor any Restricted
Party shall Transfer the Property or any part thereof or any interest therein or
permit or suffer the Property or any part thereof or any interest therein to be
Transferred other than as expressly permitted pursuant to the terms of the Loan
Agreement.
ARTICLE 7 - RIGHTS AND REMEDIES UPON DEFAULT
SECTION 7.1 REMEDIES. Upon the occurrence and during the continuance
of any Event of Default, Borrower agrees that Lender may take such action,
without notice or demand, as it deems advisable to protect and enforce its
rights against Borrower and in and to the Property, including, but not limited
to, the following actions, each of which may be pursued concurrently or
otherwise, at such time and in such order as Lender may determine, in its sole
discretion, without impairing or otherwise affecting the other rights and
remedies of Lender:
(a) declare the entire unpaid Debt to be immediately due and
payable;
(b) institute proceedings, judicial or otherwise, for the
complete foreclosure of this Mortgage under any applicable provision of law, in
which case the Property or any interest therein may be sold for cash or upon
credit in one or more parcels or in several interests or portions and in any
order or manner;
(c) with or without entry, to the extent permitted and
pursuant to the procedures provided by applicable law, institute proceedings for
the partial foreclosure of this Mortgage for the portion of the Debt then due
and payable, subject to the continuing lien and security interest of this
Mortgage for the balance of the Debt not then due, unimpaired and without loss
of priority;
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(d) sell for cash or upon credit the Property or any part
thereof and all estate, claim, demand, right, title and interest of Borrower
therein and rights of redemption thereof, pursuant to power of sale or
otherwise, at one or more sales, as an entirety or in parcels, at such time and
place, upon such terms and after such notice thereof as may be required or
permitted by law;
(e) institute an action, suit or proceeding in equity for
the specific performance of any covenant, condition or agreement contained
herein, in the Note, the Loan Agreement or in the other Loan Documents;
(f) recover judgment on the Note either before, during or
after any proceedings for the enforcement of this Mortgage or the other Loan
Documents;
(g) apply for the appointment of a receiver, trustee,
liquidator or conservator of the Property, without notice and without regard for
the adequacy of the security for the Debt and without regard for the solvency of
Borrower, any Guarantor, Indemnifying Person with respect to the Loan or of any
Person liable for the payment of the Debt;
(h) the license granted to Borrower under Section 1.2 hereof
shall automatically be revoked and Lender may enter into or upon the Property,
either personally or by its agents, nominees or attorneys and dispossess
Borrower and its agents and servants therefrom, without liability for trespass,
damages or otherwise and exclude Borrower and its agents or servants wholly
therefrom, and take possession of all books, records and accounts relating
thereto and Borrower agrees to surrender possession of the Property and of such
books, records and accounts to Lender upon demand, and thereupon Lender may (i)
use, operate, manage, control, insure, maintain, repair, restore and otherwise
deal with all and every part of the Property and conduct the business thereat;
(ii) complete any construction on the Property in such manner and form as Lender
deems advisable; (iii) make alterations, additions, renewals, replacements and
improvements to or on the Property; (iv) exercise all rights and powers of
Borrower with respect to the Property, whether in the name of Borrower or
otherwise, including, without limitation, the right to make, cancel, enforce or
modify Leases, obtain and evict tenants, and demand, xxx for, collect and
receive all Rents of the Property and every part thereof; (v) require Borrower
to pay monthly in advance to Lender, or any receiver appointed to collect the
Rents, the fair and reasonable rental value for the use and occupation of such
part of the Property as may be occupied by Borrower; (vi) require Borrower to
vacate and surrender possession of the Property to Lender or to such receiver
and, in default thereof, Borrower may be evicted by summary proceedings or
otherwise; and (vii) apply the receipts from the Property to the payment of the
Debt, in such order, priority and proportions as Lender shall deem appropriate
in its sole discretion after deducting therefrom all expenses (including
reasonable attorneys' fees) incurred in connection with the aforesaid operations
and all amounts necessary to pay the Taxes, Other Charges, Insurance Premiums
and other expenses in connection with the Property, as well as just and
reasonable compensation for the services of Lender, its counsel, agents and
employees;
(i) exercise any and all rights and remedies granted to a
secured party upon default under the Uniform Commercial Code, including, without
limiting the generality of the foregoing: (i) the right to take possession of
the Fixtures, the Equipment, the Personal
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Property or any part thereof, and to take such other measures as Lender may deem
necessary for the care, protection and preservation of the Fixtures, the
Equipment, the Personal Property, and (ii) request Borrower at its expense to
assemble the Fixtures, the Equipment, the Personal Property and make it
available to Lender at a convenient place acceptable to Lender. Any notice of
sale, disposition or other intended action by Lender with respect to the
Fixtures, the Equipment, the Personal Property sent to Borrower in accordance
with the provisions hereof at least ten (10) days prior to such action, shall
constitute commercially reasonable notice to Borrower;
(j) apply any sums then deposited or held in escrow or
otherwise by or on behalf of Lender in accordance with the terms of the Loan
Agreement, this Mortgage or any other Loan Document to the payment of the
following items in any order in its uncontrolled discretion:
(i) Taxes and Other Charges;
(ii) Insurance Premiums;
(iii) Interest on the unpaid principal balance of the Note;
(iv) Amortization of the unpaid principal balance of the Note;
(v) All other sums payable pursuant to the Note, the Loan Agreement,
this Mortgage and the other Loan Documents, including without limitation
advances made by Lender pursuant to the terms of this Mortgage;
(k) pursue such other remedies as Lender may have under
applicable law; or
(l) apply the undisbursed balance of any Net Proceeds
Deficiency deposit, together with interest thereon, to the payment of the Debt
in such order, priority and proportions as Lender shall deem to be appropriate
in its discretion.
In the event of a sale, by foreclosure, power of sale or otherwise, of less than
all of Property, this Mortgage shall continue as a lien and security interest on
the remaining portion of the Property unimpaired and without loss of priority.
SECTION 7.2 APPLICATION OF PROCEEDS. The purchase money, proceeds
and avails of any disposition of the Property, and or any part thereof, or any
other sums collected by Lender pursuant to the Note, this Mortgage or the other
Loan Documents, may be applied by Lender to the payment of the Debt in such
priority and proportions as Lender in its discretion shall deem proper.
SECTION 7.3 RIGHT TO CURE DEFAULTS. Upon the occurrence and during
the continuance of any Event of Default, Lender may, but without any obligation
to do so and without notice to or demand on Borrower and without releasing
Borrower from any obligation hereunder, make
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any payment or do any act required of Borrower hereunder in such manner and to
such extent as Lender may deem necessary to protect the security hereof. Lender
is authorized to enter upon the Property for such purposes, or appear in,
defend, or bring any action or proceeding to protect its interest in the
Property or to foreclose this Mortgage or collect the Debt, and the cost and
expense thereof (including reasonable attorneys' fees to the extent permitted by
law), with interest as provided in this Section 7.3, shall constitute a portion
of the Debt and shall be due and payable to Lender upon demand. All such costs
and expenses incurred by Lender in remedying such Event of Default or such
failed payment or act or in appearing in, defending, or bringing any such action
or proceeding shall bear interest at the Default Rate, for the period after
notice from Lender that such cost or expense was incurred to the date of payment
to Lender. All such costs and expenses incurred by Lender together with interest
thereon calculated at the Default Rate shall be deemed to constitute a portion
of the Debt and be secured by this Mortgage and the other Loan Documents and
shall be immediately due and payable upon demand by Lender therefor.
SECTION 7.4 ACTIONS AND PROCEEDINGS. Lender has the right to appear
in and defend any action or proceeding brought with respect to the Property and
to bring any action or proceeding, in the name and on behalf of Borrower, which
Lender, in its discretion, decides should be brought to protect its interest in
the Property.
SECTION 7.5 RECOVERY OF SUMS REQUIRED TO BE PAID. Lender shall have
the right from time to time to take action to recover any sum or sums which
constitute a part of the Debt as the same become due, without regard to whether
or not the balance of the Debt shall be due, and without prejudice to the right
of Lender thereafter to bring an action of foreclosure, or any other action, for
a default or defaults by Borrower existing at the time such earlier action was
commenced.
SECTION 7.6 EXAMINATION OF BOOKS AND RECORDS. At reasonable times
and upon reasonable notice, Lender, its agents, accountants and attorneys shall
have the right to examine the records, books, management and other papers of
Borrower which reflect upon the financial condition of the Property or of any
Borrower owning a 20% or greater undivided interest therein, at the Property or
at any office regularly maintained by Borrower where the books and records are
located. Lender and its agents shall have the right to make copies and extracts
from the foregoing records and other papers. In addition, at reasonable times
and upon reasonable notice, Lender, its agents, accountants and attorneys shall
have the right to examine and audit the books and records of Borrower pertaining
to the income, expenses and operation of the Property during reasonable business
hours at any office of Borrower where the books and records are located. This
Section 7.6 shall apply throughout the term of the Note and without regard to
whether an Event of Default has occurred or is continuing.
SECTION 7.7 OTHER RIGHTS, ETC. (a) The failure of Lender to insist
upon strict performance of any term hereof shall not be deemed to be a waiver of
any term of this Mortgage. Borrower shall not be relieved of Borrower's
obligations hereunder by reason of (i) the failure of Lender to comply with any
request of Borrower or any Guarantor or Indemnifying Person with respect to the
Loan to take any action to foreclose this Mortgage or otherwise enforce any of
the provisions hereof or of the Note or the other Loan Documents, (ii) the
release, regardless of consideration, of the whole or any part of the Property,
or of any person liable for the Debt or
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any portion thereof, or (iii) any agreement or stipulation by Lender extending
the time of payment or otherwise modifying or supplementing the terms of the
Note, this Mortgage or the other Loan Documents.
(a) It is agreed that the risk of loss or damage to the
Property is on Borrower, and Lender shall have no liability whatsoever for
decline in value of the Property, for failure to maintain the Policies, or for
failure to determine whether insurance in force is adequate as to the amount of
risks insured. Possession by Lender shall not be deemed an election of judicial
relief if any such possession is requested or obtained with respect to any
Property or collateral not in Lender's possession.
(b) Lender may resort for the payment of the Debt to any
other security held by Lender in such order and manner as Lender, in its
discretion, may elect. Lender may take action to recover the Debt, or any
portion thereof, or to enforce any covenant hereof without prejudice to the
right of Lender thereafter to foreclose this Mortgage. The rights of Lender
under this Mortgage shall be separate, distinct and cumulative and none shall be
given effect to the exclusion of the others. No act of Lender shall be construed
as an election to proceed under any one provision herein to the exclusion of any
other provision. Lender shall not be limited exclusively to the rights and
remedies herein stated but shall be entitled to every right and remedy now or
hereafter afforded at law or in equity.
SECTION 7.8 RIGHT TO RELEASE ANY PORTION OF THE PROPERTY. Lender may
release any portion of the Property for such consideration as Lender may require
without, as to the remainder of the Property, in any way impairing or affecting
the lien or priority of this Mortgage, or improving the position of any
subordinate lienholder with respect thereto, except to the extent that the
obligations hereunder shall have been reduced by the actual monetary
consideration, if any, received by Lender for such release, and may accept by
assignment, pledge or otherwise any other property in place thereof as Lender
may require without being accountable for so doing to any other lienholder. This
Mortgage shall continue as a lien and security interest in the remaining portion
of the Property.
SECTION 7.9 VIOLATION OF LAWS. If the Property is not in material
compliance with Legal Requirements, Lender may impose additional requirements
upon Borrower in connection herewith including, without limitation, monetary
reserves or financial equivalents.
SECTION 7.10 RECOURSE AND CHOICE OF REMEDIES. The provisions of
Section 9.4 of the Loan Agreement are hereby incorporated by reference into this
Deed of Trust to the same extent and with the same force as if fully set forth
herein.
SECTION 7.11 RIGHT OF ENTRY. Upon reasonable notice to Borrower,
Lender and its agents shall have the right to enter and inspect the Property at
all reasonable times.
SECTION 7.12 REFERENCES TO LENDER. Notwithstanding anything to the
contrary contained herein or in any of the other Loan Documents, all references
herein to "Lender" shall be deemed to collectively or individually (as the
context requires) refer to Lender or to MERS, acting on behalf of and at the
sole direction of Lender in its capacity as Lender's nominee, as each of their
interests may appear; provided, that, unless Lender, in its sole discretion,
shall
-16-
determine otherwise, only Lender (and not MERS) shall be deemed to be "Lender"
with respect to (a) any consent or similar approval right granted to Lender
hereunder or under any of the other Loan Documents (including, without
limitation, any consent or similar approval right that is deemed granted if not
approved or denied within a specified time period), (b) any items, documents or
other information required to be delivered to Lender hereunder or under any of
the other Loan Documents (other than notices expressly required to be sent to
MERS) or (c) any future funding or other obligations of Lender to Borrower or
any affiliate of Borrower hereunder or under any of the other Loan Documents, if
any.
SECTION 7.13 FAILURE TO ACT. Notwithstanding anything to the contrary
contained herein or in any of the other Loan Documents, the failure of MERS to
take any action hereunder or under any of the other Loan Documents, other than
such acts as it may be required to take under applicable law by virtue of its
capacity as lienholder or secured party of record, shall not (a) be deemed to be
a waiver of any term or condition of this Mortgage or any of the other Loan
Documents, or (b) adversely affect any rights of Lender hereunder or under any
of the other Loan Documents.
ARTICLE 8 - ENVIRONMENTAL HAZARDS
SECTION 8.1 ENVIRONMENTAL REPRESENTATIONS AND WARRANTIES. Except as
otherwise disclosed by that certain Phase I environmental report (or Phase II
environmental report, if required) delivered to Lender by Borrower in connection
with the origination of the Loan (such report is referred to below as the
"Environmental Report"), to Borrower's Knowledge (a) there are no Hazardous
Substances (defined below) or underground storage tanks in, on, or under the
Property, except those that are (i) in compliance with Environmental Laws
(defined below) and with permits issued pursuant thereto (to the extent such
permits are required under Environmental Law), (ii) de-minimis amounts necessary
to operate the Property for the purposes set forth in the Loan Agreement which
will not result in an environmental condition in, on or under the Property and
which are otherwise permitted under and used in compliance with Environmental
Law and (iii) fully disclosed to Lender in writing pursuant the Environmental
Report; (b) there are no past, present or threatened Releases (defined below) of
Hazardous Substances in, on, under or from the Property which has not been fully
remediated in accordance with Environmental Law; (c) there is no threat of any
Release of Hazardous Substances migrating to the Property; (d) there is no past
or present non-compliance with Environmental Laws, or with permits issued
pursuant thereto, in connection with the Property which has not been fully
remediated in accordance with Environmental Law; (e) Borrower does not know of,
and has not received, any written or oral notice or other communication from any
Person (including but not limited to a Governmental Authority) relating to
Hazardous Substances or Remediation (defined below) thereof, of possible
liability of any Person pursuant to any Environmental Law, other environmental
conditions in connection with the Property, or any actual or potential
administrative or judicial proceedings in connection with any of the foregoing;
and (f) Borrower has truthfully and fully disclosed to Lender, in writing, any
and all information relating to environmental conditions in, on, under or from
the Property that is known to Borrower and has provided to Lender all
information that is contained in Borrower's files and records, including, but
not limited to, any reports relating to Hazardous Substances in, on, under or
from the Property and/or to the environmental condition of the Property.
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"ENVIRONMENTAL LAW" means any present and future federal, state and
local laws, statutes, ordinances, rules, regulations and the like, as well as
common law, relating to protection of human health or the environment, relating
to Hazardous Substances, relating to liability for or costs of Remediation or
prevention of Releases of Hazardous Substances or relating to liability for or
costs of other actual or threatened danger to human health or the environment.
Environmental Law includes, but is not limited to, the following statutes, as
amended, any successor thereto, and any regulations promulgated pursuant
thereto, and any state or local statutes, ordinances, rules, regulations and the
like addressing similar issues: the Comprehensive Environmental Response,
Compensation and Liability Act; the Emergency Planning and Community
Right-to-Know Act; the Hazardous Substances Transportation Act; the Resource
Conservation and Recovery Act (including but not limited to Subtitle I relating
to underground storage tanks); the Solid Waste Disposal Act; the Clean Water
Act; the Clean Air Act; the Toxic Substances Control Act; the Safe Drinking
Water Act; the Occupational Safety and Health Act; the Federal Water Pollution
Control Act; the Federal Insecticide, Fungicide and Rodenticide Act; the
Endangered Species Act; the National Environmental Policy Act; and the River and
Harbors Appropriation Act. Environmental Law also includes, but is not limited
to, any present and future federal, state and local laws, statutes, ordinances,
rules, regulations and the like, as well as common law: conditioning transfer of
property upon a negative declaration or other approval of a governmental
authority of the environmental condition of the Property; requiring notification
or disclosure of Releases of Hazardous Substances or other environmental
condition of the Property to any governmental authority or other Person, whether
or not in connection with transfer of title to or interest in property; imposing
conditions or requirements relating to Hazardous Substances in connection with
permits or other authorization for lawful activity; relating to nuisance,
trespass or other causes of action in respect of Hazardous Substances related to
the Property; or, to the extent arising out of the presence of Hazardous
Substances, relating to wrongful death, personal injury, or property or other
damage in connection with any physical condition or use of the Property.
"HAZARDOUS SUBSTANCES" include but are not limited to any and all
substances (whether solid, liquid or gas) defined, listed, or otherwise
classified as pollutants, hazardous wastes, hazardous substances, hazardous
materials, extremely hazardous wastes, or words of similar meaning or regulatory
effect under any present or future Environmental Laws or that may have a
negative impact on human health or the environment, including but not limited to
petroleum and petroleum products, asbestos and asbestos-containing materials,
polychlorinated biphenyls, lead, radon, radioactive materials, flammables and
explosives, but excluding substances of kinds and in amounts ordinarily and
customarily used or stored in similar properties for the purpose of cleaning or
other maintenance or operations and otherwise in compliance with all
Environmental Laws.
"RELEASE" of any Hazardous Substance includes but is not limited to any
release, deposit, discharge, emission, leaking, spilling, seeping, migrating,
injecting, pumping, pouring, emptying, escaping, dumping, disposing or other
movement of Hazardous Substances.
"REMEDIATION" includes but is not limited to any response, remedial,
removal, or corrective action, any activity to clean-up, detoxify,
decontaminate, contain or otherwise remediate any Hazardous Substance, any
actions to prevent, cure or mitigate any Release of any Hazardous Substance, any
action to comply with any Environmental Laws or with any permits
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issued pursuant thereto, any inspection, investigation, study, monitoring,
assessment, audit, sampling and testing, laboratory or other analysis, or
evaluation relating to any Hazardous Substances or to anything referred to in
Article 8.
SECTION 8.2 ENVIRONMENTAL COVENANTS. Borrower covenants and agrees
that: (a) Borrower shall use commercially reasonable efforts to ensure that all
uses and operations on or of the Property shall be in compliance with all
Environmental Laws and permits issued pursuant thereto; (b) Borrower shall use
commercially reasonable efforts to prevent any Releases of Hazardous Substances
in, on, under or from the Property; (c) Borrower shall not permit any Hazardous
Substances in, on, or under the Property, except those that are (i) in
compliance with all Environmental Laws and with permits issued pursuant thereto
(to the extent such permits are required by Environmental Law), (ii) de-minimis
amounts necessary to operate the Property for the purposes set forth in the Loan
Agreement which will not result in an environmental condition in, on or under
the Property and which are otherwise permitted under and used in compliance with
Environmental Law and (iii) fully disclosed to Lender in writing; (d) Borrower
shall keep the Property free and clear of all liens and other encumbrances
imposed pursuant to any Environmental Law, whether due to any act or omission of
Borrower or any other Person (the "Environmental Liens"); (e) Borrower shall, at
its sole cost and expense, fully and expeditiously cooperate in all activities
pursuant to Section 8.3 below, including but not limited to providing all
relevant information and making knowledgeable persons available for interviews;
(f) Borrower shall, at its sole cost and expense, perform any environmental site
assessment or other investigation of environmental conditions in connection with
the Property, pursuant to any reasonable written request of Lender made in the
event that Lender has reason to believe that an environmental hazard exists on
the Property (including but not limited to sampling, testing and analysis of
soil, water, air, building materials and other materials and substances whether
solid, liquid or gas), and share with Lender the reports and other results
thereof, and Lender and other Indemnified Parties shall be entitled to rely on
such reports and other results thereof; (g) Borrower shall, at its sole cost and
expense, comply with all reasonable written requests of Lender made in the event
that Lender has reason to believe that an environmental hazard exists on the
Property to (i) reasonably effectuate Remediation of any condition (including
but not limited to a Release of a Hazardous Substance) in, on, under or from the
Property; (ii) comply with any Environmental Law; (iii) comply with any
directive from any Governmental Authority; and (iv) take any other reasonable
action necessary or appropriate for protection of human health or the
environment; (h) Borrower shall not do or allow any tenant or other user of the
Property to do any act with respect to Hazardous Substances that materially
increases the dangers to human health or the environment, poses an unreasonable
risk of harm to any Person (whether on or off the Property), impairs or may
impair the value of the Property, is contrary to any requirement of any insurer,
constitutes a public or private nuisance, constitutes waste, or violates any
covenant, condition, agreement or easement applicable to the Property; and (i)
Borrower shall immediately notify Lender in writing of (A) any presence or
Releases or threatened Releases of Hazardous Substances in, on, under, from or
migrating towards the Property; (B) any non-compliance with any Environmental
Laws related in any way to the Property; (C) any actual or potential
Environmental Lien; (D) any required or proposed Remediation of environmental
conditions relating to the Property; and (E) any written notice or other written
communication of which Borrower becomes aware from any source whatsoever
(including but not limited to a governmental entity) relating in any way to
Hazardous Substances or Remediation thereof, possible liability of any Person
pursuant to any Environmental Law, other environmental
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conditions in connection with the Property, or any actual or potential
administrative or judicial proceedings in connection with anything referred to
in this Article 8.
SECTION 8.3 LENDER'S RIGHTS. In the event that Lender has reason to
believe that an environmental hazard exists on the Property that does not, in
Lender's sole discretion, endanger any tenants or other occupants of the
Property or their guests or the general public or materially and adversely
affect the value of the Property, upon reasonable notice from Lender, Borrower
shall, at Borrower's expense, promptly cause an engineer or consultant
satisfactory to Lender to conduct an environmental assessment or audit (the
scope of which shall be determined in Lender's sole and absolute discretion) and
take any samples of soil, groundwater or other water, air, or building materials
or any other invasive testing requested by Lender and promptly deliver the
results of any such assessment, audit, sampling or other testing; provided,
however, if such results are not delivered to Lender within a reasonable period
or if Lender has reason to believe that an environmental hazard exists on the
Property that, in Lender's sole judgment, endangers any tenant or other occupant
of the Property or their guests or the general public or may materially and
adversely affect the value of the Property, upon reasonable notice to Borrower,
Lender and any other Person designated by Lender, including but not limited to
any receiver, any representative of a governmental entity, and any environmental
consultant, shall have the right, but not the obligation, to enter upon the
Property at all reasonable times to assess any and all aspects of the
environmental condition of the Property and its use, including but not limited
to conducting any environmental assessment or audit (the scope of which shall be
determined in Lender's sole and absolute discretion) and taking samples of soil,
groundwater or other water, air, or building materials, and reasonably
conducting other invasive testing. Borrower shall cooperate with and provide
Lender and any such Person designated by Lender with access to the Property.
ARTICLE 9 - INDEMNIFICATION
SECTION 9.1 GENERAL INDEMNIFICATION. Borrower shall, at its sole
cost and expense, protect, defend, indemnify, release and hold harmless the
Indemnified Parties from and against any and all claims, suits, liabilities
(including, without limitation, strict liabilities), actions, proceedings,
obligations, debts, damages, losses, costs, expenses, diminutions in value,
fines, penalties, charges, fees, expenses, judgments, awards, amounts paid in
settlement, punitive damages, foreseeable and unforeseeable consequential
damages, of whatever kind or nature (including but not limited to reasonable
attorneys' fees and other costs of defense) (collectively, the "Losses") imposed
upon or incurred by or asserted against any Indemnified Parties and directly or
indirectly arising out of or in any way relating to any one or more of the
following, except, in each case, to the extent arising out of any Indemnified
Party's gross negligence or willful misconduct: (a) ownership of this Mortgage,
the Property or any interest therein or receipt of any Rents; (b) any amendment
to, or restructuring of, the Debt, the Note, the Loan Agreement, this Mortgage,
or any other Loan Documents; (c) any and all lawful action that may be taken by
Lender in connection with the enforcement of the provisions of this Mortgage,
the Loan Agreement, the Note or any of the other Loan Documents, whether or not
suit is filed in connection with same, or in connection with Borrower, any
Guarantor or Indemnifying Person and/or any partner, joint venturer or
shareholder thereof becoming a party to a voluntary or involuntary federal or
state bankruptcy, insolvency or similar proceeding; (d) any accident, injury to
or death of persons or loss of or damage to property occurring in, on or about
the
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Property or any part thereof or on the adjoining sidewalks, curbs, adjacent
property or adjacent parking areas, streets or ways; (e) any use, nonuse or
condition in, on or about the Property or any part thereof or on the adjoining
sidewalks, curbs, adjacent property or adjacent parking areas, streets or ways;
(f) any failure on the part of Borrower to perform or be in compliance with any
of the terms of this Mortgage, the Note, the Loan Agreement or any of the other
Loan Documents; (g) performance of any labor or services or the furnishing of
any materials or other property in respect of the Property or any part thereof;
(h) the failure of any person to file timely with the Internal Revenue Service
an accurate Form 0000-X, Xxxxxxxxx for Recipients of Proceeds from Real Estate,
Broker and Barter Exchange Transactions, which may be required in connection
with this Mortgage, or to supply a copy thereof in a timely fashion to the
recipient of the proceeds of the transaction in connection with which this
Mortgage is made; (i) any failure of the Property to be in compliance with any
Legal Requirements; (j) the enforcement by any Indemnified Party of the
provisions of this Article 9; (k) any and all claims and demands whatsoever
which may be asserted against Lender by reason of any alleged obligations or
undertakings on its part to perform or discharge any of the terms, covenants, or
agreements contained in any Lease; (l) the payment of any commission, charge or
brokerage fee to anyone claiming through Borrower which may be payable in
connection with the funding of the Loan; or (m) any misrepresentation made by
Borrower in this Mortgage or any other Loan Document. Any amounts payable to
Lender by reason of the application of this Section 9.1 shall become immediately
due and payable and shall bear interest at the Default Rate from the date loss
or damage is sustained by Lender until paid. For purposes of this Article 9, the
term "Indemnified Parties" means Lender and any Person who is or will have been
involved in the origination of the Loan, any Person who is or will have been
involved in the servicing of the Loan secured hereby, any Person in whose name
the encumbrance created by this Mortgage is or will have been recorded, any
Person who may hold or acquire or will have held a full or partial interest in
the Loan secured hereby (including, but not limited to, investors or prospective
investors in the Securities, as well as custodians, trustees and other
fiduciaries who hold or have held a full or partial interest in the Loan secured
hereby for the benefit of third parties) as well as the respective directors,
officers, shareholders, partners, employees, agents, servants, representatives,
contractors, subcontractors, affiliates, subsidiaries, participants, successors
and assigns of any and all of the foregoing (including, but not limited to, any
other Person who holds or acquires or will have held a participation or other
full or partial interest in the Loan, whether during the term of the Loan or as
a part of or following a foreclosure of the Loan and any successors by merger,
consolidation or acquisition of all or a substantial portion of Lender's assets
and business).
SECTION 9.2 MORTGAGE AND/OR INTANGIBLE TAX. Borrower shall, at its
sole cost and expense, protect, defend, indemnify, release and hold harmless the
Indemnified Parties from and against any and all Losses imposed upon or incurred
by or asserted against any Indemnified Parties and directly or indirectly
arising out of or in any way relating to any tax on the making and/or recording
of this Mortgage, the Note or any of the other Loan Documents, but excluding any
income, franchise or other similar taxes.
SECTION 9.3 ERISA INDEMNIFICATION. Borrower shall, at its sole cost
and expense, protect, defend, indemnify, release and hold harmless the
Indemnified Parties from and against any and all Losses (including, without
limitation, reasonable attorneys' fees and costs incurred in the investigation,
defense, and settlement of Losses incurred in correcting any prohibited
transaction or in the sale of a prohibited loan, and in obtaining any individual
prohibited
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transaction exemption under ERISA that may be required, in Lender's sole
discretion) that Lender may incur, directly or indirectly, as a result of a
default under Sections 4.1.9 or 5.2.12 of the Loan Agreement.
SECTION 9.4 ENVIRONMENTAL INDEMNIFICATION. Borrower shall, at its
sole cost and expense, protect, defend, indemnify, release and hold harmless the
Indemnified Parties from and against any and all Losses and costs of Remediation
(whether or not performed voluntarily), engineers' fees, environmental
consultants' fees, and costs of investigation (including but not limited to
sampling, testing, and analysis of soil, water, air, building materials and
other materials and substances whether solid, liquid or gas) imposed upon or
incurred by or asserted against any Indemnified Parties, and arising out of or
in any way relating to any one or more of the following: (a) any presence of any
Hazardous Substances in, on, above, or under the Property; (b) any past, present
or threatened Release of Hazardous Substances in, on, above, under or from the
Property; (c) any activity by Borrower, any Person affiliated with Borrower or
any tenant or other user of the Property in connection with any actual, proposed
or threatened use, treatment, storage, holding, existence, disposition or other
Release, generation, production, manufacturing, processing, refining, control,
management, abatement, removal, handling, transfer or transportation to or from
the Property of any Hazardous Substances at any time located in, under, on or
above the Property; (d) any activity by Borrower, any Person affiliated with
Borrower or any tenant or other user of the Property in connection with any
actual or proposed Remediation of any Hazardous Substances at any time located
in, under, on or above the Property, whether or not such Remediation is
voluntary or pursuant to court or administrative order, including but not
limited to any removal, remedial or corrective action; (e) any past or present
non-compliance or violations of any Environmental Laws (or permits issued
pursuant to any Environmental Law) in connection with the Property or operations
thereon, including but not limited to any failure by Borrower, any Affiliate of
Borrower or any tenant or other user of the Property to comply with any order of
any Governmental Authority in connection with any Environmental Laws; (f) the
imposition, recording or filing of any Environmental Lien encumbering the
Property; (g) any administrative processes or proceedings or judicial
proceedings in any way connected with any matter addressed in Article 8 and this
Section 9.4; (h) any past, present or threatened injury to, destruction of or
loss of natural resources in any way connected with the Property, including but
not limited to costs to investigate and assess such injury, destruction or loss;
(i) any acts of Borrower or other users of the Property in arranging for
disposal or treatment, or arranging with a transporter for transport for
disposal or treatment, of Hazardous Substances owned or possessed by such
Borrower or other users, at any facility or incineration vessel owned or
operated by another Person and containing such or any similar Hazardous
Substance; (j) any acts of Borrower or other users of the Property, in accepting
any Hazardous Substance for transport to disposal or treatment facilities,
incineration vessels or sites selected by Borrower or such other users, from
which there is a Release, or a threatened Release of any Hazardous Substance
which causes the incurrence of costs for Remediation; (k) any personal injury,
wrongful death, or property damage arising under any statutory or common law or
tort law theory, including but not limited to damages assessed for the
maintenance of a private or public nuisance or for the conducting of an
abnormally dangerous activity on or near the Property (in each case, to the
extent arising out of the presence of Hazardous Substances); and (l) any
misrepresentation or inaccuracy in any representation or warranty or material
breach or failure to perform any covenants or other obligations pursuant to
Article 8. This indemnity shall survive any termination, satisfaction or
foreclosure of this Mortgage, subject to the provisions of
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Section 10.5. Notwithstanding the foregoing, Borrower shall have no liability
for any Losses imposed upon or incurred by or asserted against any Indemnified
Parties and described in this SECTION 9.4 to the extent that such Losses arose
solely by actions, conditions or events relating to the Hazardous Substances
placed in, on, above or under the Property after the date that Lender or any
Affiliate or nominee of Lender (or any purchaser at a foreclosure sale) actually
acquired title to the Property and were not caused by the direct or indirect
actions of Borrower or any officer or director of Borrower or any employee,
agent, contractor or Affiliate of Borrower.
SECTION 9.5 DUTY TO DEFEND; ATTORNEYS' FEES AND OTHER FEES AND
EXPENSES. Upon written request by any Indemnified Party, Borrower shall defend
such Indemnified Party (if requested by any Indemnified Party, in the name of
the Indemnified Party) by attorneys and other professionals approved by the
Indemnified Parties. Notwithstanding the foregoing, if the defendants in any
such claim or proceeding include both Borrower and any Indemnified Party and
Borrower and such Indemnified Party shall have reasonably concluded that there
are any legal defenses available to it and/or other Indemnified Parties that are
different from or additional to those available to Borrower, such Indemnified
Party shall have the right to select separate counsel to assert such legal
defenses and to otherwise participate in the defense of such action on behalf of
such Indemnified Party, provided that no compromise or settlement shall be
entered without Borrower's consent, which consent shall not be unreasonably
withheld. Upon demand, Borrower shall pay or, in the sole and absolute
discretion of the Indemnified Parties, reimburse, the Indemnified Parties for
the payment of reasonable fees and disbursements of attorneys, engineers,
environmental consultants, laboratories and other professionals in connection
therewith.
ARTICLE 10 - WAIVERS
SECTION 10.1 WAIVER OF COUNTERCLAIM. To the extent permitted by
applicable law, Borrower hereby waives the right to assert a counterclaim, other
than a mandatory or compulsory counterclaim, in any action or proceeding brought
against it by Lender arising out of or in any way connected with this Mortgage,
the Loan Agreement, the Note, any of the other Loan Documents, or the
Obligations.
SECTION 10.2 MARSHALLING AND OTHER MATTERS. To the extent permitted
by applicable law, Borrower hereby waives the benefit of all appraisement,
valuation, stay, extension, reinstatement and redemption laws now or hereafter
in force and all rights of marshalling in the event of any sale hereunder of the
Property or any part thereof or any interest therein. Further, Borrower hereby
expressly waives any and all rights of redemption from sale under any order or
decree of foreclosure of this Mortgage on behalf of Borrower, and on behalf of
each and every person acquiring any interest in or title to the Property
subsequent to the date of this Mortgage and on behalf of all persons to the
extent permitted by applicable law.
SECTION 10.3 WAIVER OF NOTICE. To the extent permitted by applicable
law, Borrower shall not be entitled to any notices of any nature whatsoever from
Lender except with respect to matters for which this Mortgage or any other Loan
Document specifically and expressly provides for the giving of notice by Lender
to Borrower and except with respect to matters for which Lender is required by
applicable law to give notice, and Borrower hereby expressly waives the
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right to receive any notice from Lender with respect to any matter for which
this Mortgage does not specifically and expressly provide for the giving of
notice by Lender to Borrower.
SECTION 10.4 WAIVER OF STATUTE OF LIMITATIONS. To the extent
permitted by applicable law, Borrower hereby expressly waives and releases to
the fullest extent permitted by law, the pleading of any statute of limitations
as a defense to payment of the Debt or performance of its Other Obligations.
SECTION 10.5 SURVIVAL. The indemnifications made pursuant to Sections
9.3 and 9.4 herein and the representations and warranties, covenants, and other
obligations arising under Article 8, shall continue indefinitely in full force
and effect and shall survive and shall in no way be impaired by any of the
following: any satisfaction or other termination of this Mortgage, any
assignment or other transfer of all or any portion of this Mortgage or Lender's
interest in the Property (but, in such case, shall benefit both Indemnified
Parties and any assignee or transferee), any exercise of Lender's rights and
remedies pursuant hereto including, but not limited to, foreclosure or
acceptance of a deed in lieu of foreclosure, any exercise of any rights and
remedies pursuant to the Loan Agreement, the Note or any of the other Loan
Documents, any transfer of all or any portion of the Property (whether by
Borrower or by Lender following foreclosure or acceptance of a deed in lieu of
foreclosure or at any other time), any amendment to this Mortgage, the Loan
Agreement, the Note or the other Loan Documents, and any act or omission that
might otherwise be construed as a release or discharge of Borrower from the
obligations pursuant hereto.
ARTICLE 11 - EXCULPATION
The provisions of Section 9.4 of the Loan Agreement are hereby
incorporated by reference into this Mortgage to the same extent and with the
same force as if fully set forth herein.
ARTICLE 12 - NOTICES
All notices or other written communications hereunder shall be delivered
in accordance with Section 10.6 of the Loan Agreement.
Notices to Lender hereunder and under any of the other Loan Documents
shall include a copy thereof to Lender (to be addressed and delivered in
accordance with Section 10.6 of the Loan Agreement) and shall be sent as
follows:
Lender: MERS Commercial
X.X. Xxx 0000
Xxxxx, Xxxxxxxx 00000-0000
ARTICLE 13 - APPLICABLE LAW
SECTION 13.1 GOVERNING LAW. This Deed of Trust shall be governed in
accordance with the terms and provisions of Section 10.3 of the Loan Agreement.
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SECTION 13.2 USURY LAWS. Notwithstanding anything to the contrary,
(a) all agreements and communications between Borrower and Lender are hereby and
shall automatically be limited so that, after taking into account all amounts
deemed interest, the interest contracted for, charged or received by Lender
shall never exceed the Maximum Legal Rate or amount, (b) in calculating whether
any interest exceeds the Maximum Legal Rate, all such interest shall be
amortized, prorated, allocated and spread over the full amount and term of all
principal indebtedness of Borrower to Lender, and (c) if through any contingency
or event, Lender receives or is deemed to receive interest in excess of the
Maximum Legal Rate, any such excess shall be deemed to have been applied toward
payment of the principal of any and all then outstanding indebtedness of
Borrower to Lender, or if there is no such indebtedness, shall immediately be
returned to Borrower.
SECTION 13.3 PROVISIONS SUBJECT TO APPLICABLE LAW. All rights, powers
and remedies provided in this Mortgage may be exercised only to the extent that
the exercise thereof does not violate any applicable provisions of law and are
intended to be limited to the extent necessary so that they will not render this
Mortgage invalid, unenforceable or not entitled to be recorded, registered or
filed under the provisions of any applicable law. If any term of this Mortgage
or any application thereof shall be invalid or unenforceable, the remainder of
this Mortgage and any other application of the term shall not be affected
thereby.
ARTICLE 14 - DEFINITIONS
All capitalized terms not defined herein shall have the respective
meanings set forth in the Loan Agreement. Unless the context clearly indicates a
contrary intent or unless otherwise specifically provided herein, words used in
this Mortgage may be used interchangeably in singular or plural form and the
word "Borrower" shall mean "each Borrower and any subsequent owner or owners of
a fee interest in the Property or any part thereof," the word "Lender" shall
mean "Lender and any subsequent holder of the Note," the word "Note" shall mean
"the Note and any other evidence of indebtedness secured by this Mortgage," the
word "Property" shall include any portion of the Property and any interest
therein, and the phrases "attorneys' fees", "legal fees" and "counsel fees"
shall include any and all attorneys', paralegal and law clerk fees and
disbursements, including, but not limited to, fees and disbursements at the
pre-trial, trial and appellate levels incurred or paid by Lender in protecting
its interest in the Property, the Leases and the Rents and enforcing its rights
hereunder.
ARTICLE 15 - MISCELLANEOUS PROVISIONS
SECTION 15.1 NO ORAL CHANGE. This Mortgage, and any provisions
hereof, may not be modified, amended, waived, extended, changed, discharged or
terminated orally or by any act or failure to act on the part of Borrower or
Lender, but only by an agreement in writing signed by the party against whom
enforcement of any modification, amendment, waiver, extension, change, discharge
or termination is sought.
SECTION 15.2 SUCCESSORS AND ASSIGNS. This Mortgage shall be binding
upon and inure to the benefit of Borrower and Lender and their respective
successors and assigns forever.
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SECTION 15.3 INAPPLICABLE PROVISIONS. If any term, covenant or
condition of the Loan Agreement, the Note or this Mortgage is held to be
invalid, illegal or unenforceable in any respect, the Loan Agreement, the Note
and this Mortgage shall be construed without such provision.
SECTION 15.4 HEADINGS, ETC. The headings and captions of various
Sections of this Mortgage are for convenience of reference only and are not to
be construed as defining or limiting, in any way, the scope or intent of the
provisions hereof.
SECTION 15.5 NUMBER AND GENDER. Whenever the context may require, any
pronouns used herein shall include the corresponding masculine, feminine or
neuter forms, and the singular form of nouns and pronouns shall include the
plural and vice versa.
SECTION 15.6 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 Property, then, to the extent of the funds so used, Lender
shall be subrogated to all of the rights, claims, liens, titles, and interests
existing against the Property heretofore held by, or in favor of, the holder of
such indebtedness and such 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 interest created
herein as cumulative security for the repayment of the Debt, the performance and
discharge of Borrower's obligations hereunder, under the Loan Agreement, the
Note and the other Loan Documents and the performance and discharge of the Other
Obligations.
SECTION 15.7 ENTIRE AGREEMENT. The Note, the Loan Agreement, this
Mortgage and the other Loan Documents constitute the entire understanding and
agreement between Borrower and Lender with respect to the transactions arising
in connection with the Debt and supersede all prior written or oral
understandings and agreements between Borrower and Lender with respect thereto.
Borrower hereby acknowledges that, except as incorporated in writing in the
Note, the Loan Agreement, this Mortgage and the other Loan Documents, there are
not, and were not, and no persons are or were authorized by Lender to make, any
representations, understandings, stipulations, agreements or promises, oral or
written, with respect to the transaction which is the subject of the Note, the
Loan Agreement, this Mortgage and the other Loan Documents.
SECTION 15.8 LIMITATION ON LENDER'S RESPONSIBILITY. No provision of
this Mortgage shall operate to place any obligation or liability for the
control, care, management or repair of the Property upon Lender, nor shall it
operate to make Lender responsible or liable for any waste committed on the
Property by the tenants or any other Person, or for any dangerous or defective
condition of the Property, or for any negligence in the management, upkeep,
repair or control of the Property resulting in loss or injury or death to any
tenant, licensee, employee or stranger. Nothing herein contained shall be
construed as constituting Lender a "mortgagee in possession."
ARTICLE 16 - STATE-SPECIFIC PROVISIONS
SECTION 16.1 PRINCIPLES OF CONSTRUCTION. In the event of any
inconsistencies between the terms and conditions of this ARTICLE 16 and the
terms and conditions of this Mortgage, the terms and conditions of this ARTICLE
16 shall control and be binding
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SECTION 16.2 LENDER'S RIGHT TO ACCELERATE. Upon the occurrence and
during the continuance of an Event of Default, Lender may immediately and upon
notice to Borrower declare the entire unpaid principal balance of the Note,
together with all other Debt, to be immediately due and payable, and thereupon
all such unpaid principal balance of the Note, together with all accrued
interest thereon, any prepayment premium due under the terms of the Note and all
other Indebtedness shall be and become immediately due and payable
SECTION 16.3 REMEDIES OF LENDER AND RIGHT TO FORECLOSE. Upon the
occurrence and during the continuance of an Event of Default, Borrower hereby
authorizes and fully empowers Lender to foreclose this Mortgage by judicial
proceedings or by advertisement with full authority to sell the Property at
public auction and to convey the same to the purchaser in fee simple, either in
one parcel or separate lots and parcels, all in accordance with and in the
manner prescribed by law, and out of the proceeds arising from sale and
foreclosure to retain the principal, prepayment fee, if any, and interest due on
the Note and all other Indebtedness together with all sums of money as Lender
shall have expended or advanced pursuant to this Mortgage or pursuant to statute
together with interest thereon as herein provided and all costs and expenses of
such foreclosure, including lawful attorneys' fees, with the balance, if any, to
be paid to the persons entitled thereto by law.
SECTION 16.4 ACKNOWLEDGEMENT OF WAIVER OF HEARING BEFORE SALE.
Borrower understands and agrees that if an Event of Default shall occur and
continue, Lender has the right, INTER ALIA, to foreclose this Mortgage by
advertisement pursuant to Minnesota Statutes Chapter 580, as hereafter amended,
or pursuant to any similar or replacement statute hereafter enacted; that if
Lender elects to foreclose by advertisement, it may cause the Property, or any
part thereof, to be sold at public auction; that notice of such sale must be
published for six (6) successive weeks at least once a week in a newspaper of
general circulation and that no personal notice is required to be served upon
Borrower. Borrower further understands that upon the occurrence and continuance
of an Event of Default, Lender may also elect its rights under the Uniform
Commercial Code and take possession of the Personal Property and dispose of the
same by sale or otherwise in one or more parcels provided that at least ten (10)
days prior notice of such disposition must be given, all as provided for by the
Uniform Commercial Code, as hereafter amended or by any similar or replacement
statute hereafter enacted. Borrower further understands that under the
Constitution of the United States and the Constitution of the State of Minnesota
it may have the right to notice and hearing before the Property may be sold and
that the procedure for foreclosure by advertisement described above does not
insure that notice will be given to Borrower and neither said procedure for
foreclosure by advertisement nor the Uniform Commercial Code requires any
hearing or other judicial proceedings. BORROWER HEREBY EXPRESSLY CONSENTS AND
AGREES THAT THE PROPERTY MAY BE FORECLOSED BY ADVERTISEMENT AND THAT THE
PERSONAL PROPERTY MAY BE DISPOSED OF PURSUANT TO THE UNIFORM COMMERCIAL CODE,
ALL AS DESCRIBED ABOVE. BORROWER ACKNOWLEDGES THAT IT IS REPRESENTED BY LEGAL
COUNSEL; THAT BEFORE SIGNING THIS DOCUMENT, THIS SECTION AND BORROWER'S
CONSTITUTIONAL RIGHTS WERE FULLY EXPLAINED BY SUCH COUNSEL AND THAT BORROWER
UNDERSTANDS THE NATURE AND EXTENT OF THE RIGHTS WAIVED HEREBY AND THE EFFECT OF
SUCH WAIVER.
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SECTION 16.5 APPOINTMENT OF RECEIVER. Upon the occurrence and during
the continuation of any Event of Default, Lender may, at its option, at any
time:
a. in the name, place and stead of Borrower and without
becoming a mortgagee in possession (i) enter upon, manage and operate
the Property or retain the services of one or more independent
contractors to manage and operate all or any part of the Property; (ii)
make, enforce, modify and accept surrender of the Leases; (iii) obtain
or evict tenants, collect, xxx for, fix or modify the Rents and endorse
all rights of Borrower under the Leases; and (iv) perform any and all
other acts that may be necessary or proper to protect the security of
this Mortgage.
b. with or without exercising the rights set forth in
subparagraph (a)(i) above, give or require Borrower to give, notice to
any or all tenants and guarantors under the Leases and other parties
obligated to pay Rents authorizing and directing the tenants or other
parties obligated to pay Rents to pay all Rents directly to the
Mortgagee.
c. without regard to waste, adequacy of the security or
solvency of Borrower, apply for, and Borrower hereby consents to, the
appointment of a receiver of the Property, whether or not foreclosure
proceedings have been commenced, and whether or not a foreclosure sale
has occurred. The receiver shall have authority to make Leases for terms
which extend beyond the receivership.
SECTION 16.6 APPLICATION OF RENTS AND REVENUES. All Rents and
revenues collected by the Lender or any receiver subsequent to the occurrence of
an Event of Default shall be applied as follows:
a. to the payment of all reasonable fees of any receiver
approved by court;
b. to the payment of all tenant security deposits then
owing to a lessee under any lease pursuant to the provisions of Minn. Stat.
504B.178;
c. to the payment of all prior real estate taxes and
special assessments with respect to the Property, or if this Mortgage or any
other Loan Document requires periodic escrow payments for such taxes and
assessments, to the escrow payments then due;
d. to the payment of all premiums then due for the
insurance required by the provisions of this Mortgage or any other Loan
Document, or if this Mortgage or any other Loan Document requires periodic
escrow payments for such premiums, to the escrow payments then due;
e. to the payment of costs incurred in normal maintenance
and operation of the Property;
f. if received prior to any foreclosure sale of the
Property, to the Lender for the payment of Indebtedness secured by this
Mortgage, but no such payment made after the acceleration of the Indebtedness
shall affect such acceleration;
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g. if received during or with respect to the period of
redemption after a foreclosure sale of the Property:
(1) if the purchaser at the foreclosure sale is not
the Borrower, first to the Lender to the extent of any deficiency of the
sale proceeds to repay the Indebtedness, second to the purchaser of the
Property, and
(2) if the purchaser at the foreclosure sale is the
Lender, to the Lender to the extent of any deficiency of the sale
proceeds to repay the Indebtedness as a credit to the redemption price,
but if the Property is not redeemed, then to the Lender, whether or not
such deficiency exists.
The rights and powers of the Lender under this Mortgage and the application of
rents and revenue under this Section shall continue until the expiration of the
redemption period from any foreclosure sale, whether or not any deficiency
remains after a foreclosure.
SECTION 16.7 NON-AGRICULTURAL USE. As of the date of this Mortgage,
the Property is not in agricultural use as defined in Minn. Stat. ss. 40A.02,
Subd. 3 and is not used for agricultural purposes.
SECTION 16.8 PAYMENT OF MORTGAGE REGISTRY TAX. To the extent that any
Mortgage Registry Tax ("MRT") is due under Minn. Stat. Chapter 287 (as the same
may be amended or recodified) with respect to this Mortgage, or any other tax is
due upon the Debt or this Mortgage, Borrower agrees to pay the MRT or other tax
in full, whenever due, regardless on whom the MRT or other tax is imposed under
said statute.
[NO FURTHER TEXT ON THIS PAGE]
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IN WITNESS WHEREOF, this Mortgage has been executed by Borrower as of
the day and year first above written.
BORROWER
BEHRINGER HARVARD XXXXXX COMMONS,
LLC, a Delaware limited liability
company
By: ________________________
Xxxxxx X. Xxxxxxx, III
Secretary
ACKNOWLEDGMENT
STATE OF ____________________)
) ss.:
COUNTY OF____________________)
On July ____, 2005, before me, _____________________________, a Notary
Public for said state, personally appeared Xxxxxx X. Xxxxxxx, III, personally
known to me (or proved to me on the basis of satisfactory evidence) to be the
person whose name is subscribed to the within instrument and acknowledged to me
that he/she executed the same in his/her authorized capacity, and that by
his/her signature on the instrument the person or the entity upon behalf of
which the person acted, executed the instrument.
WITNESS my hand and official seal.
_______________________________________
Notary Public
(SEAL)
EXH. A-1
EXHIBIT A
XXXX 0, 0, 0 XXX 0, XXXXX 0, XX. XXXX PROPER, ACCORDING TO THE RECORDED PLAT
THEREOF, XXXXXX COUNTY, MINNESOTA, AND THOSE PARTS OF LOTS 4 AND 9, SAID BLOCK
8, LYING SOUTHWESTERLY OF A LINE, 177.08 FEET SOUTHWESTERLY OF AND PARALLEL WITH
THE NORTHEASTERLY LINE OF SAID BLOCK 8, ACCORDING TO THE RECORDED PLAT THEREOF,
XXXXXX COUNTY, MINNESOTA.
TOGETHER WITH THE BENEFITS AND EASEMENTS CONTAINED IN RECIPROCAL EASEMENTS,
COVENANTS AND OPERATING AGREEMENTS FILED AS DOCUMENT NO. 3056996 (ABSTRACT) AND
AS DOCUMENT NO. 1500074 (TORRENS).
TOGETHER WITH THE BENEFITS OF THE AGREEMENT REGARDING CONSTRUCTION, MAINTENANCE
AND OPERATING OF A SKYWAY BRIDGE OVER FIFTH STREET BETWEEN WABASHA AND ST. XXXXX
STREETS AND ASSOCIATED PEDESTRIAN CONCOURSES AS EVIDENCED BY GRANT OF EASEMENT
AND MEMORANDUM OF SKYWAY AGREEMENT FILED AS DOCUMENT NOS. 3323227 (ABSTRACT) AND
1600663 (TORRENS).
XXX. X-0
