Exhibit 10.3
FIRST MORTGAGE AND SECURITY AGREEMENT
November 12, 2004
MORTGAGEE: FORTRESS CREDIT CORP.
0000 Xxxxxx xx xxx Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
MORTGAGOR: ACE GAMING, LLC, a New Jersey limited liability company
x/x Xxx Xxxxx Xxxxx & Xxxxxx
Xxxxxxx Xxxxxx & Xxxxxxxx Xxxx
Xxxxxxxx Xxxx, XX 00000
MORTGAGED PREMISES:
Municipality: Atlantic City
County: Atlantic, State of New Jersey
Tax Map: Xxxx 00, 00, xxx 00 xx Xxxxx 49; Lot 10 in
Block 48; Xxxx 0, 0, 0, 0, 0, 0, 0, 0, 00, 11, 12,
and 19 in Block 47; Xxx 0 xx Xxxxx 00; Xxx 0 xx Xxxxx
48; and Lots 29 and 31 in Block 156
BEING MORE PARTICULARLY DESCRIBED IN SECTION 2 BELOW.
1. DEBT:
On even date herewith, the Mortgagor executed and delivered a guaranty (the
"Guaranty") in favor of Mortgagee, guarantying as surety the payment and
performance by Atlantic Coast Entertainment Holdings, Inc., a Delaware
corporation (the "Borrower"), of or under (i) a note (the "Note") in the
original principal amount of up to TEN MILLION ($10,000,000.00) DOLLARS (the
"Loan"), together with interest as provided in the Note, and (ii) the Loan
Documents, as such term is defined therein. The terms and provisions of the Loan
are described more fully in a certain Loan and Security Agreement, dated of even
date with the Note, between Borrower and Mortgagee (the "LSA").
2. PROPERTY MORTGAGED:
To secure to the Mortgagee (i) the repayment of all sums due under this
Mortgage, the LSA, the Guaranty, the Note (and all extensions, renewals,
replacements and modifications thereof) and the other Loan Documents; (ii) the
performance of all of the Mortgagor's obligations under the terms of this
Mortgage, the Guaranty, the Note, the LSA, and the other Loan Documents; and
(iii) ALL OBLIGATIONS OF THE MORTGAGOR AND BORROWER TO THE MORTGAGEE, WHETHER
DIRECT OR INDIRECT, ABSOLUTE OR CONTINGENT, JOINT OR SEVERAL OR NOW OR HEREAFTER
EXISTING, including without limitation the Guaranty (subsections 2 (i), (ii) and
(iii) are collectively referred to as the "Liabilities"), the Mortgagor hereby
mortgages, grants and conveys to the Mortgagee all of the rights and interests
which the Mortgagor now has or will acquire with regard to the property
described in Sections 2.1 through 2.8 below (collectively, the "Mortgaged
Premises").
2.1 All of the land located in the State of New Jersey and more
particularly described in accordance with a legal description
attached hereto as Schedule "A".
This is a FIRST LIEN fee mortgage on the Mortgaged Premises.
2.2 All tenements, buildings, improvements, hereditaments, estates,
rights, titles, interests, privileges, liberties, easements and
appurtenances of any nature whatsoever belonging, benefiting or in
any way appertaining to the Mortgaged Premises, and all land lying
in the bed of any street, road, or avenue, open or proposed, in
front of or adjoining the Mortgaged Premises to the center line
thereof.
2.3 All furniture, fixtures, equipment and other articles of personal
property owned by the Mortgagor and now or hereafter attached to
or used in connection with, or with the operation of, any
improvements located on the Mortgaged Premises, as to which this
Mortgage constitutes a security agreement under the New Jersey
Uniform Commercial Code (the "Code") in addition to and not in
lieu of any other security agreement between the parties,
including, without limitation, all building supplies and
materials, furniture, fixtures and equipment, machinery,
generators, partitions, elevators, steam and hot water boilers,
heating, air conditioning equipment, lighting and power plants,
fuel oil burning apparatus, pipes, plumbing, radiators, sinks,
bath tubs, water closets, refrigerators, gas and electrical
fixtures, sprinkler systems or other fire prevention or
extinguishing apparatus and materials, including all accessories,
additions, substitutions and replacements thereof, all of which
shall be deemed to be and remain and form a part of the Mortgaged
Premises and are covered by the lien of this Mortgage. If the lien
of this Mortgage shall be subject to a conditional xxxx of sale,
chattel Mortgage, or other security interest covering any such
property, then all the right, title, and interest of the Mortgagor
in and to such property, together with the benefits of any
deposits or payments now or hereafter made thereon, are and shall
be covered by the lien of this Mortgage.
2.4 Any and all awards, damages, payments and other compensation, and
any and all claims therefor and rights thereto, which may result
from taking or injury by virtue of the exercise of the power of
eminent domain, or any damage, improvements, injury or destruction
in any manner caused to the Mortgaged Premises thereon, or any
part thereof.
2.5 All the rents, incomes, profits, revenues, royalties, bonuses,
rights, accounts, contract rights, general intangibles and
benefits under any and all leases or tenancies now existing or
hereafter created of the Mortgaged Premises or any part thereof
with the right to receive and apply the same to the Liabilities,
and Mortgagee may demand, xxx for and recover such payment but
shall not be required to do so.
2.6 The right, in the name and on behalf of Mortgagor, to appear in
any and defend any action or proceeding brought with respect to
the Mortgaged Premises and to commence any action or proceeding to
protect the interest of Mortgagee in the Mortgaged Premises.
2.7 All proceeds of the conversion, voluntary or involuntary, of any
of the foregoing into cash or liquidated claims.
2.8 All right, title and interest of Mortgagor in and to all
extensions, improvements, betterments, renewals, substitutes and
replacements of, and all additions and appurtenances to, the
Mortgaged Premises, hereafter acquired by, or released to,
Mortgagor or constructed, assembled or placed by Mortgagor on the
Mortgaged Premises, and all conversions of the security
constituted thereby, immediately upon such acquisition, release,
construction, assembling, placement or conversion, as the case may
be, and in each such case, without any further mortgage,
conveyance, assignment or other act by Mortgagor, shall become
subject to the lien hereof as fully and completely, and with the
same effect, as though now owned by Mortgagor and specifically
described herein, but at any and all times Mortgagor will execute
and deliver to Mortgagee any and all such further assurances,
mortgages, conveyances or assignments thereof as Mortgagee may
reasonably require for the purpose of expressly and specifically
subjecting the same to the lien of t his Mortgage.
TO HAVE AND TO HOLD the above granted and described Mortgaged Premises
unto and to the proper use and benefit of the Mortgagee, its successors
and assigns, Forever.
3. INCORPORATION BY REFERENCE:
The Note, the Guaranty, the assignment of leases of even date herewith from the
Mortgagor to the Mortgagee (the "Assignment of Leases"), and all Loan Documents
executed in connection therewith are hereby made a part of this Mortgage, to the
extent and with the same effect as if fully set forth herein.
4. TERM:
This Mortgage shall terminate upon the payment in full of the Liabilities and
the fulfillment or performance of all the conditions of this Mortgage and the
Liabilities. Thereupon, the Mortgagee shall release the Mortgaged Premises and
shall execute at the request of the Mortgagor a release of this Mortgage and any
other instrument to that effect deemed necessary or desirable.
5. COVENANTS:
5.1 Payment and Performance Mortgagor covenants to (i) pay to
Mortgagee all sums required to be paid by the Mortgagor under the
Note and Loan Documents, in accordance with their stated terms and
conditions; (ii) perform and comply with all terms, conditions and
covenants set forth in the Loan Documents by which the Mortgagor
is bound; and (iii) perform and comply with all of Mortgagor's
obligations and duties as landlord under any leases of the
Mortgaged Premises.
5.2 Seisin and Warranty The Mortgagor is seized of an indefeasible
estate in fee simple in the Mortgaged Premises, and the Mortgagor
warrants the title to the Mortgaged Premises in accordance with a
title commitment acceptable by the Mortgagee. The Mortgagor hereby
covenants that the Mortgagor shall (i) preserve such title and the
validity and priority of the lien of this Mortgage and shall
forever warrant and defend the same to the Mortgagee against all
lawful claims whatsoever; and (ii) execute, acknowledge and
deliver all such further documents or assurances, and cause to be
done all such further acts as may at any time hereafter be
required by the Mortgagee to protect fully the lien of this
Mortgage.
5.3 Insurance
5.3.1 The Mortgagor hereby covenants to obtain and maintain at
all times, throughout the term of this Mortgage, the
following insurance covering the Mortgaged Premises:
5.3.1.1 Commercial general liability insurance insuring
against any and all liability of the Mortgagor or
claims of liability of Mortgagor arising out of,
occasioned by or resulting from any accident or
otherwise resulting in, on or about the Mortgaged
Premises and the adjoining streets, sidewalks and
passageways, in a minimum amount of $1,000,000.00
for death or bodily injury to any one Person in
connection with one accident or occurrence in or
about the Mortgaged Premises, $2,000,000.00 for
death or bodily injury to one or more Persons in
connection with one accident or occurrence in or
about the Mortgaged Premises, and $200,000,000.00
property damage in connection with one accident or
occurrence in or about the Mortgaged Premises
(including, without limitation, blanket
contractual liability insurance, garage liability,
innkeeper's liability, products liability and
elevator liability, if applicable);
5.3.1.2 (1) With respect to the Mortgaged Premises during
any periods of construction, the Mortgagor shall
provide "Special Form" Builders Risk Insurance
(non-reporting form), including Flood, Earthquake,
and "The Replacement Cost" Endorsement, written on
a completed value basis in an amount not less than
the total value of the premises under construction
(less the total value of such improvements that
are uninsurable under the policy - i.e., site
preparation, grading, paving, parking lots, etc.,
excepting, however, excavation and foundation
costs and costs of underground tanks, conduits,
pilings and other similar underground items
subject to collapse or damage by insured perils)
without deduction for physical depreciation and
(2) with respect to the Mortgaged Premises at all
other times, the Mortgagor shall provide "Special
Form" Insurance (non-reporting form), including
Flood, Earthquake, and "The Replacement Cost"
Endorsement, written on a completed value basis in
an amount not less than the total value of the
Mortgaged Premises, without deduction for physical
depreciation;
5.3.1.3 If the Mortgaged Premises are required to be
insured pursuant to the Flood Disaster Protection
Act of 1973 or the National Flood Insurance Act of
1968, and the regulations promulgated thereunder,
flood insurance in an amount not less than the
outstanding principal of this Mortgage or the
maximum limit of coverage available, whichever
amount is less;
5.3.1.4 If required by Mortgagee, business interruption
and/or loss of rental insurance sufficient to pay,
during the period of interruption or loss, normal
operating expenses of the Mortgaged Premises;
5.3.1.5 If required by Mortgagee, boiler and machine
insurance covering pressure vessels, air tanks,
boilers, machinery, pressure piping, heating, air
conditioning and elevator equipment in such
amounts as the Mortgagee shall require from time
to time, provided that the Mortgaged Premises
contains equipment of such nature; and
5.3.1.6 Title insurance coverage in the form of a standard
ALTA Mortgage title insurance policy insuring the
Mortgage as a first lien, in the principal amount
of the Note; subject, however, to certain
"Permitted Exceptions" set forth on the Commitment
for Title Insurance issued to the Mortgagee by The
Title Company of Jersey, agent for Xxxxxxx Title
Guaranty Company, No. 102162062, dated September
23, 2004, and continued and revised through the
date hereof.
5.3.1.7 Excess/Umbrella Liability Insurance on a "Follow
Form" basis with a minimum limit of liability of
$10,000,000.00 for the Mortgaged Premises.
5.3.2 Each insurance policy required under this Section 5.3 shall
be written by insurance companies authorized or licensed to
do business in New Jersey having an Xxxxxx X. Best Company
rating of "A" or higher and a financial size category of
VII or better, and shall be on such forms and written by
such companies as shall be reasonably approved by the
Mortgagee.
5.3.3 Each insurance policy required under this Section 5.3
providing insurance against loss or damage to property
shall be written or endorsed so as to (i) contain a New
Jersey standard Mortgagee or secured party endorsement, as
the case may be, or its equivalent, and (ii) make all
losses payable directly to the Mortgagee, without
contribution.
5.3.4 Each insurance policy required under this Section 5.3
providing public liability coverage shall be written and
endorsed so as to name the Mortgagee as an additional
insured, as its interest may appear.
5.3.5 Each insurance policy required under this Section 5.3 shall
contain a provision to the effect that such policy shall
not be canceled or altered, or in any way limited in
coverage or reduced in amount, unless the Mortgagee is
notified in writing at least thirty (30) days prior to such
change. At least thirty (30) days prior to the expiration
of any such policy, the Mortgagor shall furnish evidence
satisfactory to the Mortgagee that such policy has been
renewed or replaced or is no longer required by this
Section 5.3.
5.3.6 Each insurance policy required under this Section 5.3
(except flood insurance written under the federal flood
insurance program) shall contain an endorsement by the
insurer that any loss shall be payable to the Mortgagee, as
its interest may appear, in accordance with the terms of
such policy, notwithstanding any act or negligence of the
Mortgagor which might otherwise result in forfeiture of
said insurance and the further agreement of the insurer
waiving all rights of setoff, counterclaim, deduction or
subrogation against the Mortgagor (so as not to interfere
with the Mortgagee's rights).
5.3.7 In the event of loss or damage to the Mortgaged Premises,
Mortgagor will give immediate notice thereof to Mortgagee,
and Mortgagee may make proof of loss if not made promptly
by Mortgagor and may negotiate settlement of any claims on
behalf of Mortgagor. Each insurance company concerned is
hereby authorized and directed to make payment under such
insurance, including return of unearned premiums, directly
to Mortgagee instead of to Mortgagor and Mortgagee jointly,
and Mortgagor irrevocably appoints Mortgagee as Mortgagor's
attorney-in-fact to endorse any draft therefor and to sign
any and all proofs of claim, any release and all other
documents relating thereto. Mortgagee shall have the right
to retain and apply the proceeds of any such insurance at
its sole option, to reduction of the indebtedness secured
hereby or to restoration or repair of the damaged property.
In the event of a public liability claim, the proceeds of
any insurance provided hereunder shall be applied toward
extinguishing or satisfying the liability and expense
incurred in connection therewith.
5.3.8 The Mortgagor shall not take out separate or additional
insurance with respect to the Mortgaged Premises which is
contributing in the event of loss unless it is properly
compatible with all of the requirements of this Section
5.3.
5.4 No Encumbrances At no time throughout the term of this Mortgage
shall the Mortgagor create or suffer to exist any new or
refinanced mortgage, pledge, lien, security interest, encumbrance,
attachment, levy, distraint or other judicial process and burdens
of any kind on the Mortgaged Premises without the prior express
written consent of the Mortgagee.
5.5 Taxes and Other Charges The Mortgagor shall prepare and timely
file all federal, state and local tax returns required to be filed
by the Mortgagor and promptly pay and discharge all taxes,
assessments, and other governmental charges imposed upon the
Mortgagor, the Mortgaged Premises or on any of the Mortgagor's
other property before the same shall become in default, or become
a lien upon such property, except for those taxes, assessments and
other governmental charges then being contested in good faith by
the Mortgagor by appropriate proceedings and for which the
Mortgagor has maintained adequate reserves in the sole judgment of
the Mortgagee. The Mortgagor shall submit to the Mortgagee, upon
request, an affidavit signed by the Mortgagor certifying that all
federal, state and local information income tax returns have been
filed to date and all real property taxes, assessments and other
governmental charges with respect to the Mortgagor's properties
have been paid to date.
5.6 Tax Escrows Upon request by Mortgagee following the declaration of
an Event of Default, the Mortgagor shall pay to the Mortgagee at
the time of each installment of principal and interest due under
the Note, one twelfth (1/12) of the actual (if known) or estimated
(if unknown) annual taxes and assessments levied and assessed
against the Mortgaged Premises. In such event, Mortgagor shall pay
concurrently with each installment of principal and interest
payable on the Note, a deposit in an amount as in the Mortgagee's
discretion will enable the Mortgagee to pay (out of the monies so
paid to the Mortgagee) at least thirty (30) days before due, all
taxes, assessments, and similar charges affecting the Mortgaged
Premises. At closing, a deposit will be made in an amount
sufficient to cover the necessary accrued tax expense. No interest
or other compensation shall be paid by Mortgagee to Mortgagor on
the funds so held and accumulated. Such payment shall be held by
the Mortgagee to be used by the Mortgagee in payment of such taxes
and assessments. If such escrow funds are not sufficient to pay
such taxes and assessments, as the same become payable, the
Mortgagor shall pay to the Mortgagee, upon request, such
additional amounts as the Mortgagee shall estimate to be
sufficient to make up any deficiency. No amount paid to the
Mortgagee hereunder shall be deemed to be trust funds but may be
commingled with general funds of the Mortgagee and no interest
shall be payable thereon. Upon the occurrence of an Event of
Default (as hereinafter defined), the Mortgagee shall have the
right, at its sole discretion, to apply any amounts so held
against the Liabilities. If the Mortgagor is not required to pay
such tax escrows pursuant to this Section 5.6, the Mortgagor shall
provide to Mortgagee on an annual basis, within five (5) business
days after each payment, copies of receipted tax bills, canceled
checks or other evidence satisfactory to the Mortgagee evidencing
that such taxes and assessments have been paid in a timely manner.
Notwithstanding anything herein to the contrary, during the term
of this Mortgage, Mortgagee, in its sole discretion, may require
the establishment or re-establishment, as the case may be, of the
tax escrow described above. Thereupon, Mortgagor immediately shall
produce such escrow in such amount and on such forms as Mortgagee
shall specify. No delay or omission by Mortgagee in exercising its
right to require the establishment of a tax escrow or its prior
exercise of such right, shall exhaust or impair, in any way, its
right to assert or re-assert its right to such escrow.
5.7 Advances with Respect to Mortgaged Premises The Mortgagor agrees
that if, at any time during the term of this mortgage, the
Mortgagor fails to perform or observe any covenant or obligation
under this Mortgage, including, without limitation, payment of any
tax assessment or other government charges, insurance premiums,
appraisal charges as set forth in Section 5.17 hereof,
environmental inspection, audit, testing or compliance costs as
set forth in Section 10.3 hereof, or costs to keep the Mortgaged
Premises in satisfactory repair and condition, the Mortgagee may
(but shall not be obligated to) take such steps as are reasonably
necessary to remedy any such non-performance or non-observance and
provide payment thereof. All amounts advanced by the Bank shall be
added to the amount secured by this Mortgage, and shall be due and
payable, on demand, together with interest at the Default Rate of
Interest specified in the LSA, such interest to be calculated from
the date of such advance to the date of repayment thereof.
5.8 Transfer of Title Without the prior express written consent of the
Mortgagee, the Mortgagor shall not voluntarily or involuntarily
sell, transfer, convey or in any other manner change (i) the
ownership of the Mortgaged Premises, or any interest therein, or
(ii) the ownership of the Mortgagor, or any interest therein,
without satisfying the Liabilities in full.
5.9 Mergers, Etc. The Mortgagor shall not merge with or into or
consolidate with or into, or with respect to the Mortgaged
Premises, sell, assign, lease or otherwise dispose of (whether in
one transaction or a series of transactions) all or substantially
all of its assets (now owned or hereafter acquired) to any person,
except as may be permitted in the LSA. If the Mortgagor is a
corporation, it shall not sell, issue, or agree to sell or issue,
any shares (voting, non-voting, preferred or common of any class)
of Mortgagor, or purchase such shares except under such
circumstances as will in the opinion of the Mortgagee not result
in a material adverse change in the financial or business
condition of the Mortgagor or the value of any security held by
the Mortgagee. If the Mortgagor is a partnership, no partnership
interest may be sold, transferred, assigned, or hypothecated. No
new partners may be admitted without the Mortgagee's prior written
consent, which consent shall not unreasonably be withheld.
5.10 No Additional Liens on Fixtures Except as may be permitted in the
LSA, the Mortgagor shall not remove or suffer to be removed from
the Mortgaged Premises any fixtures (the term "fixtures" is
defined by the law in New Jersey) presently or in the future owned
by the Mortgagor (unless such fixtures have been replaced with
similar fixtures of equal or greater utility and value); nor will
the Mortgagor execute any security interest upon any such
fixtures, without the prior express written consent of the
Mortgagee.
5.11 Preservation, Maintenance and Repair
5.11.1 All buildings and other improvements presently or in the
future erected upon the Mortgaged Premises shall, at the
Mortgagor's own cost and expense, be kept in good and
substantial repair, working order and condition, and the
Mortgagor shall from time to time make, or cause to be
made, all necessary and proper repairs and replacements.
The Mortgagor shall not remove, demolish, materially alter,
discontinue the use of, sell, transfer, assign, hypothecate
or otherwise dispose of all or any part of the Mortgaged
Premises without the prior express written consent of the
Mortgagee. All alterations, replacements, renewals or
additions made pursuant to this Section 5.11, shall
automatically become a part of the Mortgaged Premises and
shall be covered by the lien of this Mortgage.
5.11.2 The Mortgagee shall have the right, but not the obligation,
to enter upon the Mortgaged Premises at any reasonable hour
to inspect. In the event any such inspection reveals, in
the sole discretion of the Mortgagee, the necessity for any
repair, replacement, clean-up or maintenance, Mortgagor
shall, at the discretion of the Mortgagee either (i) cause
such work to be effected immediately, or (ii) establish an
interest bearing reserve fund with the Mortgagee in an
amount determined by the Mortgagee for the purpose of
effecting such work.
5.12 Compliance with Laws The Mortgagor hereby agrees to comply with
all laws, rules, regulations and ordinances made or promulgated by
lawful authority which are now or may hereafter by applicable to
the Mortgaged Premises within such time as may be required by law.
As of the date hereof, neither the Mortgagor nor any tenant in the
Mortgaged Premises has received any notice from any such lawful
authority that the Mortgaged Premises is in violation of any such
law, rule, regulation or ordinance. The Mortgagor hereby covenants
and agrees that, if such a notice is received by the Mortgagor or
any tenant in the Mortgaged Premises at any time during the
existence of this Mortgage, the Mortgagor shall immediately, but
in any event within three (3) days of receipt of such notice,
notify the Mortgagee in writing as to the nature and the extent of
such claimed violation and shall further provide the Mortgagee a
copy of such notice.
5.13 Damage, Destruction and Condemnation
5.13.1 If all or any part of the Mortgaged Premises shall be
damaged or destroyed, or if title to or the temporary use
of the whole or any part of the Mortgaged Premises shall be
taken or condemned by a competent authority for any public
use or purpose, there shall be no abatement or reduction in
the amounts payable by the Mortgagor under the Loan
Documents and the Mortgagor shall continue to be obligated
to make such payments.
5.13.2 If all or any part of the Mortgaged Premises is partially
or totally damaged or destroyed, the Mortgagor shall give
prompt notice thereof to the Mortgagee. The Mortgagor
hereby authorizes and directs any affected insurance
company to make payment of such proceeds directly to the
Mortgagee. The Mortgagee is hereby authorized and empowered
by the Mortgagor to settle, adjust or compromise, in
consultation with the Mortgagor, any claims for loss,
damage or destruction to the Mortgaged Premises. The
Mortgagor shall pay all costs of collection of insurance
proceeds payable on account of such damage or destruction.
The Mortgagor shall have no claim against the insurance
proceeds, or be entitled to any portion thereof, and all
rights to the insurance proceeds are hereby assigned to the
Mortgagee to the extent of the Liabilities as remain
unpaid. The Mortgagee shall have the option in its sole
discretion, of paying or applying all or any part of the
insurance proceeds to (i) reduction of the Liabilities;
(ii) restoration, replacement and rebuilding of the
Mortgaged Premises in accordance with the Mortgagee's
standard construction loan disbursement conditions and
requirements; or (iii) the Mortgagor.
5.13.3 Nothing in this Section 5.13 shall relieve the Mortgagor of
its duty to repair, restore, rebuild or replace the
Mortgaged Premises following damage or destruction, or
partial condemnation in the event that no or inadequate
proceeds of insurance or condemnation awards are available
to defray the cost of such repairing, restoring, rebuilding
or replacement.
5.14 Required Notices In addition to any notices required, including
without limitation any notices of environmental matters, the
Mortgagor shall notify the Mortgagee within three (3) days of (i)
the receipt of notice from any governmental authority relating to
the structure, use or occupancy of all or any part of the
Mortgaged Premises, (ii) a substantial change in the occupancy or
use of all or any part of the Mortgaged Premises, (iii) the
receipt of any notice from the holder of any lien or security
interest in all or any part of the Mortgaged Premises; or (iv) the
commencement of any litigation affecting the financial ability of
the Mortgagor or the value of the Mortgaged Premises.
5.15 No Credits on Accounts of the Liabilities The Mortgagor shall not
claim or demand or be entitled to any credit on account of the
Liabilities for any part of the taxes paid with respect to the
Mortgaged Premises or any part thereof and no deduction shall
otherwise be made or claimed from the taxable value of the
Mortgaged Premises, or any part thereof, by reason of this
Mortgage.
5.16 Books and Records The Mortgagor shall keep and maintain complete
and accurate books and records in accordance with the requirements
of the LSA, reflecting all of the financial affairs of the
Mortgagor and all items or income and expense in connection with
the operations of the Mortgaged Premises. The Mortgagor shall
permit representatives of the Mortgagee to examine and audit the
Mortgagor's books and records and to inspect the Mortgagor's
facilities and properties as is provided in the LSA.
5.17 Intentionally Omitted
5.18 Financial Statements The Mortgagor shall provide to the Mortgagee the
financial statements as is required by and in the manner set forth in
the LSA within ninety (90) days of the close of each calendar year. All
such statements shall set forth in reasonable detail the results of
operations and conditions of the Mortgagor and shall be in a form
satisfactory to Mortgagee.
6. DECLARATION OF NO OFFSET:
The Mortgagor represents to the Mortgagee that the Mortgagor has no knowledge of
any offsets, counterclaims or defenses to the Liabilities either at law or in
equity. The Mortgagor shall, within three (3) days upon request in person or
within ten (10) days upon request by mail, furnish a written statement in form
satisfactory to the Mortgagee stating the amount due under the Liabilities and
either that the Mortgagor knows of no such offsets or defenses or if such
offsets or defenses are alleged to exist, the nature and extent thereof.
7. SECURITY AGREEMENT:
This Mortgage constitutes a security agreement under the Code and shall be
deemed to constitute a fixture financing statement. Mortgagor hereby grants to
Mortgagee, pursuant to the terms of the Loan Documents, a security interest in
the personal and other property owned by Mortgagor and included in the Mortgaged
Premises, in all replacements, substitutions and future additions thereto and in
all rents, income, profits, revenues, accounts, contract rights and intangibles
as more fully described in Section 2 hereof. Mortgagor shall at Mortgagor's own
expense, execute and file such financing statements, continuation statements or
other security agreements as Mortgagee shall require from time to time to
perfect the lien of this Mortgage with respect to such property. Without
limiting the foregoing, Mortgagor hereby authorizes Mortgagee to file such
financing statements without the signature of Mortgagor. Mortgagor shall not
change its principal place of business without giving Mortgagee at least thirty
(30) days prior written notice, which notice shall be accompanied by new
financing statements executed by Mortgagor in the same form as the financing
statements delivered to Mortgagee on the date hereof except for the change of
address. Upon any Event of Default (as herein set forth), Mortgagee shall have,
in addition to any other rights and remedies hereunder or under the Loan
Documents, all of the rights and remedies granted to a secured party under the
Code. Notwithstanding any release of any of the real property included in the
Mortgaged Premises, any proceedings to foreclose this Mortgage or its
satisfaction of record, the terms of this Section 7 shall survive as a security
agreement until the satisfaction in full of the Liabilities.
8. ABSOLUTE ASSIGNMENT OF RENTS AND LEASES:
8.1 The Mortgagor hereby absolutely assigns and sets over to the Mortgagee
the rents, income and profits arising out of or from the Mortgaged
Premises for the purpose of making the payment of the indebtedness
secured by this Mortgage and, so long as there shall exist no Event of
Default under the Note, this Mortgage or any of the other Loan
Documents, there is reserved to the Mortgagor a license to collect as
they become due, but not prior to accrual, all rents, income and
profits from the Mortgaged Premises and the proceeds of rent insurance
and to retain, use and enjoy the same and to apply such rents, issues,
income and profits, all as more specifically provided for and required
under the Note and this Mortgage to the payment of (i) the cost of all
such alterations, renovations, repairs, replacements and maintenance
and expenses incident to taking and retaining possession of the
Mortgaged Premises and the management and operation thereof and keeping
the same insured, (ii) all taxes, charges, claims, assessments, water
rents, sewer rents and any and all other liens on the Mortgaged
Premises and premiums for said insurance, with interest on all such
items and (iii) the repayment of indebtedness herein described then due
and payable, together with all costs and reasonable attorneys' fees,
before using any part of the same for any other purpose. Upon the
occurrence of an Event of Default under the Note, this Mortgage or any
of the other Loan Documents, such license granted to the Mortgagor
shall be immediately revoked without further demand or notice from the
Mortgagee, and the Mortgagee is hereby empowered to enter upon and take
possession of the Mortgaged Premises for the purpose of collecting the
same and to let the Mortgaged Premises or any part thereof, and to
apply the rents, issues and profits, after payment of all necessary
charges and expenses, on account of said indebtedness. This assignment
and grant shall continue in effect until this Mortgage is paid in full
and discharged of record. The Mortgagor shall not, without the prior
express written consent of the Mortgagee, receive or collect rent from
any tenant of the Mortgaged Premises or any part thereof for a period
of more than one (1) month in advance and upon the occurrence of an
Event of Default under the Note, this Mortgage or any of the other Loan
Documents, the Mortgagor shall pay monthly in advance to the Mortgagee
or to any receiver appointed to collect such rents, issues and profits,
the fair and reasonable rental value for the use and occupation of the
Mortgaged Premises or of such part thereof as may be in the possession
of the Mortgagor and, upon default in any such payment, the Mortgagor
shall vacate and surrender the possession of the Mortgaged Premises to
the Mortgagee or to such receiver. If the Mortgagor does not so vacate
and surrender the Mortgaged Premises, then the Mortgagor may be evicted
by summary proceedings.
9. CHANGE IN LAWS:
During the term of the Mortgage, in the event of the passage after the date of
this Mortgage of any law of the State of New Jersey, or any other governmental
entity, changing the taxation of mortgages, or debts secured thereby, for state
or local purposes, or the manner of the operation of any such taxes, so as to
affect the interest of the Mortgagee, then the Mortgagor shall pay the full
amount of such taxes; provided that if payment by the Mortgagor of any such new
taxes would be unlawful or usurious, the Mortgagee may, at the Mortgagee's
option, (i) declare the Liabilities to be immediately due and payable; or (ii)
pay that portion of such taxes as renders the Liabilities unlawful or usurious,
in which event the Mortgagor shall concurrently therewith pay the remaining
lawful and non-usurious portion of said taxes.
10. ENVIRONMENTAL COVENANTS:
Mortgagor represents and warrants, to the best of its knowledge after due
inquiry and investigation, as follows:
10.1 Mortgagor's Representations & Warranties
10.1.1 None of the real property owned and/or occupied by Mortgagor
and located in the State of New Jersey, including, but not
limited to the Mortgaged Premises, has ever been used by
previous owners and/or operators to refine, produce, store,
handle, transfer, process or transport "Hazardous Substances",
as such term is defined in N.J.A.C. 7:1E-1.6, as same may be
amended from time to time, and Mortgagor has not in the past,
nor does Mortgagor intend in the future, to use said real
property, including but not limited to the Mortgaged Premises,
for the purpose of refining, producing, storing, handling,
transferring, processing or transporting said "Hazardous
Substances".
10.1.2 None of the real property owned and/or occupied by Mortgagor
and located in the State of New Jersey, including but not
limited to the Mortgaged Premises, has been or is now being
used as a "Major Facility", as such term is defined in N.J.A.C.
7:1E-1.6, as same may be amended from time to time, and said
real property, including but not limited to the Mortgaged
Premises, will not be used as a "Major Facility" after
completion of the construction, renovation, restoration and
other developmental work there on.
10.1.3 No lien has been attached to any revenues or any real or
personal property owned by Mortgagor and located in the State
of New Jersey, including, but not limited to the Mortgaged
Premises, as a result of the chief executive of the New Jersey
Spill Compensation Fund expending monies from said fund to pay
for "Damages', as such term is defined in N.J.S.A. 58:20-23.11g
and/or "Cleanup and Removal Costs", as such term is defined in
N.J.A.C. 7:1E-1.6, arising from an intentional or unintentional
action or omission of Mortgagor or any previous owner and/or
operator of said real property, including, but not limited to
the Mortgaged Premises, resulting in the releasing, spilling,
pumping, pouring, emitting, emptying or dumping of "Hazardous
Substances", as such term is defined in N.J.A.C. 7:1E-1.6, as
same may be amended from time to time, into the waters of the
State of New Jersey or onto land from which it might flow or
drain into said waters or into waters outside the jurisdiction
of the State of New Jersey where damage may have resulted to
the lands, waters, fish, shellfish, wildlife, biota, air and
other resources owned, managed, held in trust or otherwise
controlled by the State of New Jersey.
10.1.4 Mortgagor has complied fully with the requirements of the New
Jersey Spill Compensation and Control Act (N.J.S.A. 58:10-23-11
et seq.) and the regulations promulgated thereunder (N.J.A.C.
7:1E-1.6 et seq.) as same may be amended from time to time,
with respect to the Mortgaged Premises and any other real
property owned and/or operated by Mortgagor and located in New
Jersey.
10.1.5 Mortgagor has not received a summons, citation, directive,
letter or other communication, written or oral, from the New
Jersey Department of Environmental Protection ("NJDEP")
concerning any intentional or unintentional action or omission
on Mortgagor's part resulting in the releasing, spilling,
leaking, pumping, pouring, emitting, emptying or dumping of
"Hazardous Substances", as such term is defined in N.J.A.C.
7:1E-1.6, into the waters or onto the lands of the State of New
Jersey, or into the water outside the jurisdiction of the State
of New Jersey, resulting in damage to the land, waters, fish,
shellfish, wildlife, biota, air and other resources owned,
managed, held in trust or otherwise controlled by the State of
New Jersey.
10.1.6 None of the real property owned and/or occupied by Mortgagor
and located in the State of New Jersey, including, but not
limited to the Mortgaged Premises, has ever been used by
previous owners and/or operators to generate, manufacture,
refine, transport, treat, store, handle or dispose of
"Hazardous Substances" or Hazardous Wastes", as such terms are
defined in N.J.A.C. 7:1-1.6 and N.J.A.C. 7:26-1.4, as same may
be amended from time to time, respectively, and the Mortgagor
does not intend to use any of its real property, including but
not limited to, the Mortgaged Premises, for such purposes.
10.1.7 There is no presence of "Hazardous Substances" or "Hazardous
Wastes", as such terms are defined in N.J.A.C. 7:1E-1.6 and
N.J.A.C. 7:26-1.4, respectively, and the Mortgagor has found no
evidence of the presence of said "Hazardous Substances" or
"Hazardous Wastes" on or in the Mortgaged Premises.
10.1.8 In connection with any purchase of the Mortgaged Premises or
any business or assets located thereon or any "closing,
terminating or transferring operations" of any "industrial
establishment" occurring on or after December 31, 1983,
Mortgagor required that the Seller of said real property,
including the Mortgaged Premises, or business or assets located
thereon, comply with the provisions of the New Jersey
Environmental Cleanup Responsibility Act, N.J.S.A. 13:1K-6 et
seq. ("ECRA"), the New Jersey Industrial Site Recovery Act,
("ISRA") as same may be amended from time to time, or obtain a
Letter of Non-Applicability ("LNA") from the NJDEP that
ECRA/ISRA was not applicable to the captioned purchase, and the
Seller did comply therewith.
10.1.9 Mortgagor represents that there are no underground storage
tanks located at or on the Mortgaged Premises that are not
regulated in accordance with law. Underground storage tanks
shall have the definition as set forth in X.X.XX. 58:10A.22(p).
10.1.10 Mortgagor represents that the real property is in full
compliance with all other statutes, including without
limitation federal statutes, affecting same.
10.2 Mortgagor's Covenants
10.2.1 If Mortgagor ever becomes such an owner or operator, then
Mortgagor shall furnish the NJDEP with all the information
required by N.J.A.C. 7:1E-1.1 et seq. as same may be amended
from time to time.
10.2.2 Mortgagor shall not cause or permit to exist, as a result of an
intentional or unintentional action or omission on its part, a
releasing, spilling, leaking, pumping, emitting, pouring,
emptying or dumping of a "Hazardous Substance", as such term is
defined in N.J.A.C. 7:1E-1.6, as same may be amended from time
to time, into waters of the State of New Jersey or onto the
lands from which it might flow or drain into said waters, or
into waters outside the jurisdiction of the State of New
Jersey, where damage may result to the lands, waters, fish,
shellfish, wildlife, biota, air and other resources owned,
managed, held in trust or otherwise controlled by the State of
New Jersey, unless said release, spill, leak, pumping,
emitting, pouring, emptying or dumping is pursuant to and in
compliance with the conditions of a permit issued by the
appropriate federal or state governmental authorities.
10.2.3 So long as Mortgagor shall own or operate any real property
located in the State of New Jersey, which is used as a "Major
Facility", as such term is defined in N.J.A.C. 7:1E-1.6, as
same may be amended from time to time, Mortgagor shall duly
file or cause to be duly filed with the Director of the
Division of Taxation in the New Jersey Department of the
Treasury, a tax report or return and shall pay or make
provisions in accordance with and pursuant to N.J.S.A.
58:10-23.11H.
10.2.4 In the event that there shall be filed a lien against the
Mortgaged Premises by the NJDEP, pursuant to and in accordance
with the provisions of N.J.S.A. 58:10-23.11(f), as same may be
amended from time to time, as a result of the chief executive
of the New Jersey Spill Compensation Fund having expended
monies from said fund to pay for "Damages", as such term is
defined in N.J.S.A. 58:10-23.11(g), as same may be amended from
time to time, and/or "Cleanup and Removal Costs", as such term
is defined in N.J.A.C. 7:1E-1.6, as same may be amended from
time to time, arising from an intentional or unintentional
action or omission of Mortgagor, resulting in the releasing,
spilling, pumping, pouring, emitting, emptying or dumping of
"Hazardous Substances", as such term is defined in N.J.A.C.
7:1E-1.6, as same may be amended from time to time, into the
waters of the State of New Jersey or onto lands from which it
might flow or drain into said waters, the Mortgagor shall,
within thirty (30) days from the date that Mortgagor is given
notice that the lien has been placed against the Mortgaged
Premises or within such shorter period of time in the event
that the State of New Jersey has commenced steps to cause the
Mortgaged Premises to be sold pursuant to the lien, either (i)
pay the claim and remove the lien from the Mortgaged Premises,
or (ii) furnish (a) a bond satisfactory the Title Insurance
Company and Mortgagee in the amount of the claim out of which
the lien arises, (b) a cash deposit in the amount of the claim
out of which the lien arises, or (c) other security reasonably
satisfactory to Mortgagee in an amount sufficient to discharge
the claim out of which the lien arises.
10.2.5 Should Mortgagor cause or permit any intentional or
unintentional action or omission resulting in the releasing,
spilling, leaking, pumping, pouring, emitting, emptying or
dumping of "Hazardous Substances", as such term is defined in
N.J.A.C. 7:1E-1.6 as same may be amended from time to time,
into the waters or onto the lands of the State of New Jersey,
or into the waters outside the jurisdiction of the State of New
Jersey, resulting in damage to the lands, waters, fish,
shellfish, wildlife, biota, air and other resources owned,
managed, held in trust or otherwise controlled by the State of
New Jersey, without having obtained a permit issued by the
appropriate governmental authorities, Mortgagor shall promptly
clean up such spill, leak, etc. in accordance with the
provision of the New Jersey Spill Compensation and Control Act.
10.2.6 If Mortgagor shall own or operate any underground storage
tanks, as that term is defined at N.J.S.A. 58:10-A-22(p), at or
on the Mortgaged Premises, Mortgagor shall comply with all
requirements of N.J.S.A. 58:10A-21, et seq., including but not
limited to, registration of all underground storage tanks,
inventory control and record keeping, testing, or monitoring,
installation of leak detection systems or secondary containment
of underground tanks, or other activities as may be required by
regulations promulgated by the NJDEP.
10.2.7 In the event that there shall be filed a lien against the
Mortgaged Premises by the NJDEP, or in the event that an
Administrative Order, directive, or other notice, whether oral
or written, is received pursuant to the terms of N.J.S.A.
58:10A-21 et seq. as same may be amended from time to time,
requiring remediation or payment for remediation performed by
the NJDEP or any consultant or contractor retained by the NJDEP
to remediate any release of hazardous substances from
underground storage tanks, then Mortgagor shall comply with the
terms of any such order or directive or Mortgagor shall, within
thirty (30) days from the date that Mortgagor is given notice
of action taken on the Mortgaged Premises by NJDEP or its
agents, pay the amount set forth in said directive, notice or
order so as to prevent the creation of a lien on the Mortgaged
Premises by virtue of such action.
10.3 Right to Inspect and Cure The Mortgagee shall have the right to conduct
or have conducted by its agent or contractors, such environmental
inspections, audits and testing as the Mortgagee shall deem necessary
or advisable from time to time at the sole cost and expense of the
Mortgagor. The cost of such tests shall be added to the Liabilities and
shall be secured by this Mortgage. Mortgagor shall, and shall cause
each lessee of the Mortgaged Premises to, cooperate with such
inspection efforts; such cooperation shall include, without limitation,
supplying such information concerning the operations conducted and
Hazardous Substances or Hazardous Wastes located at the Mortgaged
Premises. In the event that the Mortgagor fails to comply with any
applicable environmental law then the Mortgagee may, in addition to any
of its other remedies under this Mortgage, cause the Mortgaged Premises
to be in compliance with such laws and the cost of such compliance
shall be added to the sums secured by this Mortgage and shall bear
interest from the date of demand at the rate of interest then in effect
under the Note plus five (5%) percent per annum.
11. INDEMNIFICATION:
11.1 The Mortgagor hereby agrees to and does hereby indemnify, protect,
defend and save harmless the Mortgagee, and any entity which "controls"
the Mortgagee, within the meaning of the Securities Act of 1933, as
amended, any member, officer, director, official, agent, employee and
attorney of the Mortgagee, and their respective heirs, successors and
assigns (collectively, the "Indemnified Parties"), from and against any
and all losses, damages, expenses or Liabilities of any kind or nature
and from any suits, claims or demands, including reasonable counsel
fees incurred in investigating or defending such claim, suffered by any
of them and caused by, relating to, arising out of, resulting from, or
in any way connected with the Loan Documents and the transactions
contemplated therein (unless caused by the gross negligence or willful
misconduct of the Indemnified Parties) including, without limitation:
(i) disputes between any architect, general contractor, subcontractor,
materialman or supplier, or on account of any act or omission or act by
the Mortgagee in connection with the Mortgaged Premises; (ii) losses,
damages, expenses or liabilities sustained by the Mortgagee in
connection with any environmental inspection, sampling or cleanup of
the Mortgaged Premises required or mandated by any applicable
environmental law; (iii) any untrue statement of material fact
necessary to be stated therein in order to make such statement not
misleading or incomplete; (iv) the failure of the Mortgagor to perform
any obligations herein required to be performed by the Mortgagor; and
(v) the ownership, construction, occupancy, operation, use and
maintenance of the Mortgaged Premises.
11.2 In case any action shall be brought against the Mortgagee in respect to
which indemnity may be sought against the Mortgagor, the Mortgagee
shall promptly notify the Mortgagor and the Mortgagor shall assume the
defense thereof, including the employment of counsel selected by the
Mortgagor and satisfactory to the Mortgagee, the payment of all costs
and expenses and the right to negotiate and consent to settlement. The
Mortgagee shall have the right, at its sole option, to employ separate
counsel in any such action and to participate in the defense thereof.
The Mortgagor shall not be liable for any settlement of any such action
effected without its consent, but if settled with the Mortgagor's
consent, or if there be a final judgment of the claimant in any such
action, the Mortgagor agrees to indemnify and save harmless the
Mortgagee from and against any loss or liability by reason of such
settlement or judgment.
11.3 The provisions of this Section 11 shall survive the repayment of the
Liabilities.
12. EVENTS OF DEFAULT:
12.1 The Mortgagor shall be in default of this Mortgage upon the occurrence
of any Event of Default that is described in the LSA, the Note, the
Guaranty, or the other Loan Documents.
13. REMEDIES:
IF ANY EVENT OF DEFAULT SHALL HAVE OCCURRED, THE MORTGAGEE MAY TAKE ANY OF THE
FOLLOWING ACTIONS (WITHOUT THE OBLIGATION TO MARSHAL), IN ADDITION TO ANY OTHER
REMEDIES AVAILABLE AT LAW, IN EQUITY, OR BOTH:
13.1 Acceleration The Mortgagee may declare the entire amount of the
Liabilities immediately due and payable without presentment, demand,
notice of any kind, protest or notice of protest, all of which are
expressly waived, notwithstanding anything to the contrary contained in
the Loan Documents. The Mortgagee may collect interest from the date of
default on the unpaid balance of the Liabilities, at the Default Rate
of Interest set forth in the LSA.
13.2 Possession The Mortgagee may enter upon and take possession of the
Mortgaged Premises; lease and let the Mortgaged Premises; and receive
all the rents, income, issues and profits thereof which are overdue,
due or to become due; and apply the same, after payment of all
necessary charges and expenses, on account of the amounts hereby
secured. The Mortgagee is given and granted full power and authority to
do any act or thing which the Mortgagor or successors or assigns of the
Mortgagor who may then own the Mortgaged Premises might or could do in
connection with the management and operation of the Mortgaged Premises.
This covenant becomes effective either with or without any action
brought to foreclose this Mortgage and without applying for a receiver
of such rents, if any. Should such rents or any part thereof be
assigned without the consent of the holder of this Mortgage, then this
Mortgage shall at the option of the holder hereof become due and
payable immediately, anything herein contained to the contrary
notwithstanding.
13.3 Foreclosure The Mortgagee may institute an action of mortgage
foreclosure, or take other action as the law may allow, at law or in
equity, or both, for the enforcement of this Mortgage. In case of any
sale of the Mortgaged Premises by judicial proceedings, the Mortgaged
Premises may be sold in one parcel or in such parcels, manner or order
as the Mortgagee in its sole discretion may elect. The Mortgagee shall
not be required to marshal any of the security under this Mortgage. The
failure to make any tenant a defendant to a foreclosure proceeding
shall not be asserted by the Mortgagor as defense in any proceeding
instituted by the Mortgagee to collect the Liabilities or any
deficiency remaining unpaid after the foreclosure sale of the Mortgaged
Premises.
13.4 Appointment of Receiver. The Mortgagee may have a receiver of the
rents, income, issues and profits of the Mortgaged Premises appointed
without the necessity of proving either the depreciation or the
inadequacy of the value of the security or the insolvency of the
Mortgagor or any person or party who may be legally or equitably liable
to pay monies secured hereby, and the Mortgagor and each such person or
party waive such proof and consent to the appointment of a receiver.
13.5 Fair Rental Payments. If the Mortgagor or any subsequent owner is
occupying the Mortgaged Premises or any part thereof, it is hereby
agreed that such occupants shall pay such reasonable rental monthly in
advance as the Mortgagee shall demand for the Mortgaged Premises or the
part so occupied, and for the use of personal property covered by this
Mortgage or any chattel mortgage.
13.6 Excess Monies. The Mortgagee may apply on account of the unpaid
indebtedness evidenced by the Note (including any unpaid accrued
interest) owed to the Mortgagee after a foreclosure sale of the
Mortgaged Premises, whether or not a deficiency action shall have been
instituted, any unexpended monies still retained by the Mortgagee that
were paid by the Mortgagor to the Mortgagee (i) for the payment of, or
as security for the payment of taxes, assessments, municipal or
governmental rates, charges, impositions, liens, water or sewer rents,
or insurance premiums, if any, or (ii) in order to secure the
performance of some act by the Mortgagor.
13.7 Remedies at Law or Equity. The Mortgagee may take any of the remedies
otherwise available to it as a matter of law or equity.
14. MISCELLANEOUS:
14.1 Cumulative Rights. The rights and remedies herein expressed to be
vested in or conferred upon the Mortgagee shall be cumulative and shall
be in addition to, and not in substitution for or derogation of the
rights and remedies conferred by any applicable law. The failure, at
any one or more times, of the Mortgagee to assert the right to declare
the principal indebtedness due or the granting of any extension or
extensions of time of payment of the Note either to the maker or to any
other person or party, the taking of other or additional security for
the payment thereof, or releasing of any security, or changing any of
the terms of this Mortgage, the Note or any other obligation
accompanying this Mortgage, or the waiver of or failure to exercise any
right under any covenant or stipulation herein contained shall not in
any way affect this Mortgage nor the rights of the Mortgagee hereunder
nor operate as a release from any personal liability upon the Note or
other obligation accompanying this Mortgage, nor under any covenant or
stipulation therein contained, nor under any agreement assuming the
payment of said Note or obligations.
14.2 Application of Proceeds.
(i) All payments and proceeds received under this Mortgage after the
occurrence of an Event of Default shall be applied in the following
order of priority:
(a) First, to the payment of all fees, costs and expenses
(including reasonable attorneys' fees and expenses, and expressly
including any and all post-judgment collection costs and expenses)
incurred by the Mortgagee and/or its agents or representatives in
connection with the realization of such payments or proceeds;
(b)Next, to the payment in full of all unpaid principal, accrued
interest and other sums, if any, due and owing under the Note; and
(c) Next, the balance, if any, of such payments, proceeds, or
amounts to the Mortgagor, or, if otherwise determined by a court of
competent jurisdiction, to whomever may be entitled thereto.
(ii) If the amount of the proceeds received from the sale or other
disposition of the Mortgaged Premises shall be insufficient to satisfy
in full the amounts referred to in subparagraphs (a) and (b) of this
Section 14.2, then the Mortgagor shall remain and be liable for any
such deficiency
14.3 Waiver of Defaults The Mortgagee may, by written notice to the
Mortgagor, waive any Event of Default hereunder and its consequences
and rescind any acceleration or maturity of principal. In every case of
any such waiver or rescission, in accordance with the preceding
sentence, the Mortgagee shall be bound thereby.
14.4 Agreement to Pay Attorneys' Fees and Expenses Upon the occurrence of an
Event of Default, as a result of which the Mortgagee shall employ
attorneys or incur other expenses for the collection of the Liabilities
or performance of any agreement on the part of the Mortgagor contained
herein, the Mortgagor shall, on demand, pay to the Mortgagee, the
reasonable fee of such attorneys (or allocated costs of the Mortgagee's
in-house legal counsel) and such other reasonable expenses so incurred
by the Mortgagee.
14.5 Moratorium Laws; Right of Redemption Mortgagor will not at any time
insist upon, or plead, or in any manner whatever claim or take any
benefit or advantage of any stay or extension or moratorium law, any
exemption from execution or sale of the Mortgaged Premises or any part
thereof, wherever enacted, now or at any time hereafter in force
providing for the valuation or appraisal of the Mortgaged Premises, or
any part thereof, prior to any sale or sales thereof which may be made
pursuant to any provision herein, or pursuant to any decree, judgment
or order of any court of competent jurisdiction; nor, after any such
sale or sales, claim or exercise any right under any statute heretofore
or hereafter enacted to redeem the property so sold or any part thereof
and Mortgagor hereby expressly waives all benefit or advantage of any
such law or laws, and covenants not to hinder, delay or impede the
execution of any power herein granted or delegated to Mortgagee, but to
suffer and permit the execution of every power as though no such law or
laws had been made or enacted. Mortgagor, for itself and all who may
claim under it, waives, to the extent that it lawfully may, all right
to have the Mortgaged Property marshaled upon any foreclosure hereof.
14.6 Mortgagee's Rights Concerning Application of Amounts Collected
Notwithstanding anything to the contrary contained herein, upon the
occurrence of an Event of Default, Mortgagee may apply, to the extent
permitted by law, any amount collected hereunder to principal, interest
or any other sum due under the Note or otherwise in respect of the Loan
in such order and amounts, and to such obligations, as Mortgagee shall
elect in its sole and absolute discretion.
14.7 No Additional Waiver Implied By One Waiver The Mortgagee shall not be
deemed to waive any of its rights or remedies hereunder unless such
waiver is in writing and signed by the Mortgagee and then only to the
extent specifically set forth therein. In the event any agreement
contained in the Mortgage should be breached by the Mortgagor and
thereafter waived by the Mortgagee, such waiver shall be limited to the
actual breach so waived and shall not be deemed to waive any other
breach hereunder.
14.8 No Oral Modifications The terms of this Mortgage may not be changed
orally but only by an agreement in writing signed by the party against
whom enforcement of any waiver, change, modification or discharge is
sought.
14.9 Partial Invalidity The unenforceability or invalidity of any one or
more provisions shall not render any of the provisions unenforceable or
invalid.
14.10 Binding Effect The covenants, conditions and agreements contained in
this Mortgage shall bind, and the benefits thereof shall inure to, the
respective parties hereto and their respective heirs, executors,
administrators, successors and assigns and are intended and shall be
held to be real covenants running with the land; provided however, that
this Mortgage cannot be assigned by the Mortgagor without the prior
express written consent of the Mortgagee.
14.11 Captions The captions preceding the text of the sections of this
Mortgage are used solely for the convenience of reference and shall not
affect the meaning or construction of this Mortgage.
14.12 Number and Gender In the event that the Mortgagor consists of more
than one person or entity, the obligations and liabilities hereunder of
each such person or entity shall be joint and several and the word
"Mortgagor" shall mean all or some or any of them. For the purpose of
this Mortgage, the singular shall be deemed to include the plural and
the neuter shall be deemed to include the masculine and feminine, as
the context may require.
14.13 Commercial Loan The Mortgagor represents and warrants that the loan
secured by this Mortgage was obtained solely for the purpose of
providing working capital.
14.14 Modification of Mortgage This Mortgage is subject to "modification" as
such term is defined in P.L. 1985 c.353 (N.J.S.A. 46:9-8.1 et seq.)
and shall be subject to the priority provisions thereof.
14.15 New Jersey Law Governs This Mortgage shall be governed and construed
in accordance with the laws of the State of New Jersey, without giving
effect to choice of law rules.
14.16 Consent to Jurisdiction The Mortgagor hereby irrevocably consents to
the jurisdiction of the State of New Jersey (venued in Atlantic
County) and to the jurisdiction of the United States District Court
for the District of New Jersey, for the purpose of any suit, action or
other proceeding arising out of or relating to this Mortgage or any
other Loan Document, or the subject matter hereof or thereof. The
Mortgagor hereby waives, and agrees not to assert, any such suit,
action or proceeding, any claim that it is not personally subject to
such jurisdiction, or any right to remove an action brought in State
or Federal Court, or any claim that such suit, action or proceeding is
in an inconvenient forum or that the venue thereof is improper. The
Mortgagor agrees that service in any such action, whether or not in
either such jurisdiction, may be effected by means in accordance with
the provisions hereinafter set forth or by any other means of service
allowed by law.
14.17 Notices Unless otherwise indicated differently, all notices which may
be required hereunder shall be in writing and shall be personally
delivered or sent by telex (answer back received), courier, or
first-class certified or registered United States mail, postage
prepaid, return receipt requested, and sent to the party at its
address appearing above or such other address as any party shall
hereafter inform the other party by notice given as aforesaid. All
notices shall be deemed effective upon receipt or, if mailed, upon
receipt or the expiration of the third day following the date of
mailing, whichever occurs first except that any notice of change in
address shall be effective only upon receipt by the party to whom said
notice is addressed.
14.18 Waiver of Jury Trial THE MORTGAGOR AND MORTGAGEE HEREBY WAIVE ANY
RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO ANY
ASPECT OF THIS MORTGAGE OR THE LOAN DOCUMENTS. THE MORTGAGOR
ACKNOWLEDGES THAT IT HAS HAD THE OPPORTUNITY TO CONSULT WITH
INDEPENDENT COUNSEL WITH RESPECT TO THIS WAIVER.
14.19 Disassociation, Solvency, and Default of Borrower and Guarantors All
sums payable under the Note, Mortgage and Loan Documents shall become
due at the option of the Bank in the event of the filing by the
Mortgagor of a petition in bankruptcy or insolvency, or in
reorganization, or for the appointment of a receiver or a trustee, or
the making of an assignment for the benefit of creditors or the filing
of a petition for an arrangement by the Mortgagor which is not
withdrawn or dismissed and/or terminated before the expiration of
sixty (60) days from the date thereof, or in the event of the filing
against the Mortgagor of the following, which said filings are not
withdrawn or discharged within sixty (60) days therefrom: a petition
in bankruptcy or insolvency, or in reorganization, or for the
appointment of a receiver or a trustee, or the filing of a petition
for an arrangement.
IN WITNESS WHEREOF, this mortgage has been duly executed and sealed by
the mortgagor on the day and year first written above.
RECEIPT, WITHOUT CHARGE, OF A TRUE COPY OF THIS MORTGAGE IS ACKNOWLEDGED.
ACE GAMING, LLC
By:/s/ Xxxxxx Xxxx
Name: Xxxxxx Xxxx
Title: President
