MORTGAGE, ASSIGNMENT OF LEASES AND RENTS
AND SECURITY AGREEMENT
Dated as of June __, 2003
XXXXXXXX REALTY LLC
(Mortgagor)
TO
XXXX XXXXXXX LIFE INSURANCE COMPANY
(Mortgagee)
LOCATION OF PROPERTY:
00 Xxxxxx Xxxx, Xxxxxx, Xxx Xxxx
(aka 00 Xxxxxxxx Xxxxx, Xxxxxxx, Xxx Xxxx)
Section 55.06, Block 1, Lot 3.1 and 3.2
Tax Map of the Town of Ramapo, County of Rockland
Record and Return To:
Xxxxxxx & Xxxxxx, LLP
00 Xxxxx Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Xxxx X. X'Xxxxxxxx, Esq.
TABLE OF CONTENTS
Page
1. Payment of Indebtedness and Incorporation of Covenants, Conditions and Agreements....................4
2. Warranty of Title....................................................................................5
3. Insurance; Casualty..................................................................................5
4. Payment of Taxes, Etc...............................................................................10
5. Reserve Fund........................................................................................11
6. Condemnation........................................................................................14
7. Leases and Rents....................................................................................15
8. Maintenance and Use of Mortgaged Property...........................................................17
9. Transfer or Encumbrance of the Mortgaged Property or Interests in the Mortgagor;
Other Indebtedness.............................................................................18
10. Estoppel Certificates..............................................................................23
11. No Cooperative or Condominium......................................................................23
12. Changes in the Laws Regarding Taxation.............................................................23
13. No Credits on Account of the Indebtedness..........................................................24
14. Documentary Stamps.................................................................................24
15. Right of Entry.....................................................................................24
16. Books and Records..................................................................................24
17. Performance of Other Agreements....................................................................25
18. Representations and Covenants Concerning Loan......................................................25
19. Single Purpose Entity/Separateness.................................................................27
20. Events of Default; Remedies........................................................................30
21. Additional Remedies................................................................................32
22. Right to Cure Defaults.............................................................................34
23. Late Payment Charge................................................................................34
24. Prepayment.........................................................................................34
25. Prepayment After Event of Default..................................................................35
26. Appointment of Receiver............................................................................35
27. Security Agreement.................................................................................35
28. Authority..........................................................................................36
29. Actions and Proceedings............................................................................36
30. Further Acts, Etc..................................................................................37
31. Recording of Mortgage, Etc.........................................................................37
32. Usury Laws.........................................................................................37
33. Sole Discretion of Mortgagee.......................................................................38
34. Recovery of Sums Required To Be Paid...............................................................38
35. Marshalling and Other Matters......................................................................38
36. Waiver of Notice...................................................................................38
37. Remedies of Mortgagor..............................................................................38
38. Reporting Requirements.............................................................................38
39. Hazardous Materials................................................................................39
40. Asbestos...........................................................................................41
41. Bankruptcy or Insolvency...........................................................................41
42. Compliance with ERISA and State Statutes on Governmental Plans.....................................42
43. Assignments........................................................................................43
44. Cooperation........................................................................................43
45. Indemnification for Non-Recourse Carveout Obligations..............................................44
46. Exculpation........................................................................................44
47. Notices............................................................................................45
48. Non-Waiver.........................................................................................46
49. Joint and Several Liability........................................................................46
50. Severability.......................................................................................46
51. Duplicate Originals................................................................................47
52. Indemnity and Mortgagee's Costs....................................................................47
53. Certain Definitions................................................................................47
54. No Oral Change.....................................................................................47
55. No Foreign Person..................................................................................48
56. Separate Tax Lot...................................................................................48
57. Right to Release Any Portion of the Mortgaged Property.............................................48
58. Subrogation........................................................................................48
59. Administrative Fees................................................................................48
60. Disclosure.........................................................................................48
61. Headings, Etc......................................................................................49
62. Address of Real Property...........................................................................49
63. Intentionally Deleted..............................................................................49
64. Publicity..........................................................................................49
65. Relationship.......................................................................................49
66. Homestead..........................................................................................49
67. No Third Party Beneficiaries.......................................................................49
68. Compliance with Regulation U.......................................................................49
69. Entire Agreement...................................................................................49
70. Servicer...........................................................................................49
71. Governing Law; Consent to Jurisdiction.............................................................49
72. Partial Release of Air Rights......................................................................50
73. Special State Provisions...........................................................................52
INDEX OF DEFINED TERMS
Additional Land...................................................................................................1
Architect ....................................................................................................7
Assignee ...................................................................................................13
Assignment of Leases and Rents...................................................................................13
Assignor ...................................................................................................13
Bankruptcy Code...................................................................................................3
Code ...................................................................................................33
Collateral ...................................................................................................32
Depository ...................................................................................................10
Equipment ....................................................................................................2
ERISA ...................................................................................................39
GAAP ...................................................................................................25
Guarantors ...................................................................................................24
Guaranty ...................................................................................................44
Improvements ...................................................................................................1
Indebtedness ...................................................................................................1
Independent Director.............................................................................................26
Insolvency Opinion...............................................................................................26
Land ....................................................................................................1
Late Charge ...................................................................................................31
Leases ....................................................................................................3
Loan ....................................................................................................1
Loan Documents...................................................................................................44
Management Agreement.............................................................................................23
Manager ...................................................................................................23
Mortgage ....................................................................................................1
Mortgaged Property............................................................................................1, 45
Mortgagee ................................................................................................1, 44
Mortgagor ................................................................................................1, 44
Non-Recourse Carveout Obligations................................................................................42
Note ................................................................................................1, 44
Other Charges ...................................................................................................10
Permitted Encumbrances............................................................................................5
Person ...................................................................................................45
Policies ....................................................................................................6
Rating Agencies..................................................................................................19
Real Property ...................................................................................................1
Rents ................................................................................................3, 13
Repair and Remediation Reserve Fund..............................................................................12
Replacement Reserve Agreement....................................................................................11
Replacement Reserve Fund.........................................................................................11
Reserve Fund ...................................................................................................12
Restoration ...................................................................................................7
Secondary Market Transactions....................................................................................41
Servicer ...................................................................................................47
Small Lease ...................................................................................................14
SPC Party ...................................................................................................26
Tax and Insurance Fund...........................................................................................11
Taxes ...................................................................................................10
Tenant Improvement and Leasing Commission Reserve................................................................11
Tenant Improvement and Leasing Commission Reserve Fund...........................................................12
Termination Amount...............................................................................................14
Transferee ...................................................................................................18
Uniform Commercial Code...........................................................................................2
THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT (this
"Mortgage"), made as of the ____ day of June, 2003, by XXXXXXXX REALTY LLC, a
Delaware limited liability company having its principal place of business at 00
Xxxxxxxx Xxxxx, Xxxxxxx, Xxx Xxxx 00000 ("Mortgagor"), to and for the benefit of
XXXX XXXXXXX LIFE INSURANCE COMPANY, a Massachusetts corporation having its
principal place of business at Xxxx Xxxxxxx Tower, T-56, 000 Xxxxxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000 ("Mortgagee").
W I T N E S S E T H:
TO SECURE THE PAYMENT OF an indebtedness in the principal sum of
THIRTY-FOUR MILLION AND 00/100 DOLLARS ($34,000,000.00), lawful money of the
United States of America, to be paid with interest and all other sums and fees
payable according to a certain mortgage note dated the date hereof made by
Mortgagor to Mortgagee (the mortgage note, together with all extensions,
renewals or modifications thereof, being hereinafter collectively called the
"Note"; and the loan evidenced by the Note being hereinafter referred to as the
"Loan") and all indebtedness, obligations, liabilities and expenses due
hereunder and under any other Loan Document (as hereinafter defined) (the
indebtedness, interest, other sums, fees, obligations and all other sums due
under the Note and/or hereunder and/or any other Loan Document being
collectively called the "Indebtedness"), Mortgagor has mortgaged, given,
granted, bargained, sold, alienated, enfeoffed, conveyed, confirmed, pledged,
assigned and hypothecated and by these presents does mortgage, give, grant,
bargain, sell, alien, enfeoff, convey, confirm, pledge, assign and hypothecate
unto Mortgagee and hereby grants unto Mortgagee a security interest in the
following property and rights owned or held by Mortgagor, whether now owned or
held or hereafter acquired (collectively, the "Mortgaged Property"):
GRANTING CLAUSE ONE
All right, title and interest in and to the real property or properties
described on Exhibit A hereto (collectively, the "Land").
GRANTING CLAUSE TWO
All xxxxxxxxxx xxxxx, xxxxxxx and development rights hereafter acquired by
Mortgagor 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
thereof (collectively, the "Additional Land").
GRANTING CLAUSE THREE
Any and all buildings, structures, fixtures, additions, enlargements,
extensions, modifications, repairs, replacements and improvements now or
hereafter located on the Land or any part thereof (collectively, the
"Improvements"; the Land, the Additional Land and the Improvements hereinafter
collectively referred to as the "Real Property").
GRANTING CLAUSE FOUR
All easements, rights-of-way, strips and gores of land, streets, ways,
alleys, passages, sewer rights, water, water courses, water rights and powers,
oil, gas and mineral rights, air rights and development rights, zoning rights,
tax credits or benefits and all estates, rights, titles, interests, privileges,
liberties, tenements, hereditaments and appurtenances of any nature whatsoever
in any way now or hereafter belonging, relating or pertaining to the Real
Property or any part thereof and the reversion and reversions, remainder 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 or any part thereof to the center
line thereof and all the estates, rights, titles, interests, dower and rights of
dower, curtesy and rights of curtesy, property, possession, claim and demand
whatsoever, both in law and in equity, of Mortgagor in, of and to the Real
Property and every part and parcel thereof, with the appurtenances thereto.
GRANTING CLAUSE FIVE
All machinery, equipment, fixtures and other property of every kind and
nature whatsoever owned by Mortgagor or in which Mortgagor has or shall have an
interest (to the extent of such interest) now or hereafter located upon the Real
Property or appurtenant thereto and usable in connection with the present or
future operation and occupancy of the Real Property and all building equipment,
materials and supplies of any nature whatsoever owned by Mortgagor or in which
Mortgagor has or shall have an interest (to the extent of such interest) now or
hereafter located upon the Real Property or appurtenant thereto or usable in
connection with the present or future operation and occupancy of the Real
Property, including but not limited to all heating, ventilating, air
conditioning, plumbing, lighting, communications and elevator machinery,
equipment and fixtures (hereinafter collectively called the "Equipment") and the
right, title and interest of Mortgagor in and to any of the Equipment which may
be subject to any security agreements (as defined in the Uniform Commercial Code
of the State in which the Mortgaged Property is located (the "Uniform Commercial
Code")) superior, inferior or pari passu in lien to the lien of this Mortgage.
In connection with Equipment which is leased to Mortgagor or which is subject to
a lien or security interest which is superior to the lien of this Mortgage, this
Mortgage shall also cover all right, title and interest of each Mortgagor in and
to all deposits and the benefit of all payments now or hereafter made with
respect to such Equipment.
GRANTING CLAUSE SIX
All awards or payments, including interest thereon, which may heretofore
and hereafter be made with respect to the Real Property or any part thereof,
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
said right), or for a change of grade or for any other injury to or decrease in
the value of the Real Property.
GRANTING CLAUSE SEVEN
All leases and other agreements affecting the use, enjoyment and/or
occupancy of the Real Property or any part thereof, now or hereafter entered
into (including any use or occupancy arrangements created pursuant to Section
365(h) of Title 11 of the United States Code (the "Bankruptcy Code") or
otherwise in connection with the commencement or continuance of any bankruptcy,
reorganization, arrangement, insolvency, dissolution, receivership or similar
proceedings or any assignment for the benefit of creditors in respect of any
tenant or occupant of any portion of the Real Property), together with any
extension or renewal of the same (the "Leases") and all income, rents, issues,
profits, revenues and proceeds including, but not limited to, all oil and gas or
other mineral royalties and bonuses from the Real Property (including any
payments received pursuant to Section 502(b) of the Bankruptcy Code or otherwise
in connection with the commencement or continuance of any bankruptcy,
reorganization, arrangement, insolvency, dissolution, receivership or similar
proceedings or any assignment for the benefit of creditors in respect of any
tenant or occupant of any portion of the Real Property and all claims as a
creditor in connection with any of the foregoing) (the "Rents") and all proceeds
from the sale, cancellation, surrender or other disposition of the Leases and
the right to receive and apply the Rents to the payment of the Indebtedness.
GRANTING CLAUSE EIGHT
All proceeds of and any unearned premiums on any insurance policies
covering the Real Property or any part thereof including, without limitation,
the right to receive and apply the proceeds of any insurance, judgments or
settlements made in lieu thereof, for damage to the Real Property or any part
thereof.
GRANTING CLAUSE NINE
All tax refunds, including interest thereon, tax credits and tax abatements
and the right to receive or benefit from the same, which may be payable or
available with respect to the Real Property.
GRANTING CLAUSE TEN
The right, in the name and on behalf of Mortgagor, to appear in and defend
any action or proceeding brought with respect to the Real Property or any part
thereof and to commence any action or proceeding to protect the interest of
Mortgagee in the Real Property or any part thereof.
GRANTING CLAUSE ELEVEN
All accounts receivable, utility or other deposits, intangibles, contract
rights, interests, estates or other claims, both in law and in equity, which
Mortgagor now has or may hereafter acquire in the Real Property or any part
thereof.
GRANTING CLAUSE TWELVE
All rights which Mortgagor now has or may hereafter acquire to be
indemnified and/or held harmless from any liability, loss, damage, cost or
expense (including, without limitation, attorneys' fees and disbursements)
relating to the Real Property or any part thereof.
GRANTING CLAUSE THIRTEEN
All plans and specifications, maps, surveys, studies, reports, contracts,
subcontracts, service contracts, management contracts, franchise agreements and
other agreements, franchises, trade names, trademarks, symbols, service marks,
approvals, consents, permits, special permits, licenses and rights, whether
governmental or otherwise, respecting the use, occupation, development,
construction and/or operation of the Real Property or any part thereof or the
activities conducted thereon or therein, or otherwise pertaining to the Real
Property or any part thereof, to which Mortgagor is a party or bound.
GRANTING CLAUSE FOURTEEN
All proceeds, products, offspring, rents and profits from any of the
foregoing, including without limitation, those from sale, exchange, transfer,
collection, loss, damage, disposition, substitution or replacement of any of the
foregoing.
WITH RESPECT to any portion of the Mortgaged Property which is not real
estate under the laws of the State in which the Mortgaged Property is located,
Mortgagor hereby grants, bargains, sells and conveys the same to Mortgagee for
the purposes set forth hereunder and Mortgagee shall be vested with all rights,
power and authority granted hereunder or by law to Mortgagee with respect
thereto, (provided, however, that Mortgagee acknowledges that the Mortgaged
Property shall not include any personal property owned by tenants of the Land or
Improvements, including, without limitation, The Dress Barn, Inc., Par
Pharmaceuticals and Xerox).
TO HAVE AND TO HOLD the above granted and described Mortgaged Property unto
and to the use and benefit of Mortgagee and the successors and assigns of
Mortgagee forever.
PROVIDED, HOWEVER, these presents are upon the express condition, if
Mortgagor shall well and truly pay to Mortgagee the Indebtedness at the time and
in the manner provided in the Note and this Mortgage and shall well and truly
abide by and comply with each and every covenant and condition set forth herein,
in the Note and in the other Loan Documents, these presents and the estate
hereby granted shall cease, terminate and be void.
AND Mortgagor represents and warrants to and covenants and agrees with
Mortgagee as follows:
PART I - GENERAL PROVISIONS
1. Payment of Indebtedness and Incorporation of Covenants, Conditions and
Agreements. Mortgagor shall pay the Indebtedness at the time and in the manner
provided in the Note, this Mortgage and the other Loan Documents. All the
covenants, conditions and agreements contained in the Note and 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.
2. Warranty of Title. Mortgagor has good and marketable title to the
Mortgaged Property; Mortgagor has the right to mortgage, give, grant, bargain,
sell, alienate, enfeoff, convey, confirm, pledge, lease, assign, hypothecate and
grant a security interest in the Mortgaged Property; Mortgagor possesses an
indefeasible fee estate in the Real Property; and Mortgagor owns the Mortgaged
Property free and clear of all liens, encumbrances and charges whatsoever except
those exceptions shown in the title insurance policy insuring the lien of this
Mortgage (this Mortgage and the liens, encumbrances and charges shown as
exceptions in such title policy, hereinafter collectively referred to as the
"Permitted Encumbrances"). Mortgagor shall forever warrant, defend and preserve
such title and the validity and priority of the lien of this Mortgage and shall
forever warrant and defend the same to Mortgagee against the claims of all
persons whomsoever.
3. Insurance; Casualty.
(a) Mortgagor, at its sole cost and expense, shall keep the Mortgaged
Property insured during the term of this Mortgage for the mutual benefit of
Mortgagor and Mortgagee against loss or damage by any peril covered by a
standard "special perils" or "all-risk-of-physical-loss" insurance policy
including, without limitation, riot and civil commotion, acts of terrorism,
vandalism, malicious mischief, burglary, theft and mysterious disappearance in
an amount (i) equal to at least one hundred percent (100%) of the then "full
replacement cost" of the Improvements and Equipment, without deduction for
physical depreciation and (ii) such that the insurer would not deem Mortgagor a
coinsurer under such policies. The policies of insurance carried in accordance
with this Paragraph 3 shall be paid annually in advance and shall contain the
"Replacement Cost Endorsement" with a waiver of depreciation, and shall have a
deductible no greater than $50,000 unless so agreed by Mortgagee.
(b) Mortgagor, at its sole cost and expense, for the mutual benefit of
Mortgagor and Mortgagee, shall also obtain and maintain during the term of this
Mortgage the following policies of insurance:
(i) Flood insurance if any part of the Real Property is located in an area
identified by the Secretary of Housing and Urban Development as an area
having special flood hazards and in which flood insurance has been made
available under the National Flood Insurance Act of 1968 (and any successor
act thereto) in an amount at least equal to the outstanding principal
amount of the Note or the maximum limit of coverage available with respect
to the Improvements and Equipment under said Act, whichever is less.
(ii) Comprehensive public liability insurance, including broad form property
damage, blanket contractual and personal injuries (including death
resulting therefrom) coverages.
(iii)Rental loss insurance in an amount equal to at least one hundred percent
(100%) of the aggregate annual amount of all rents and additional rents
payable by all of the tenants under the Leases (whether or not such Leases
are terminable in the event of a fire or casualty), such rental loss
insurance to cover rental losses for a period of at least one (1) year
after the date of the fire or casualty in question. The amount of such
rental loss insurance shall be increased from time to time during the term
of this Mortgage as and when new Leases and renewal Leases are entered into
in accordance with the terms of this Mortgage, to reflect all increased
rent and increased additional rent payable by all of the tenants under such
renewal Leases and all rent and additional rent payable by all of the
tenants under such new Leases.
(iv) Insurance against loss or damage from explosion of steam boilers, air
conditioning equipment, high pressure piping, machinery and equipment,
pressure vessels or similar apparatus now or hereafter installed in the
Improvements.
(v) Such other insurance (including, without limitation, earthquake insurance)
as may from time to time be reasonably required by Mortgagee in order to
protect its interests or, in the event of a Secondary Market Transaction,
as required by the Rating Agencies (as such terms are hereinafter defined).
(c) All policies of insurance (the "Policies") required pursuant to this
Paragraph 3 shall be issued by an insurer satisfactory to Mortgagee (and, in the
event of a Secondary Market Transaction, to the Rating Agencies), (ii) shall
contain the standard New York Mortgagee non-contribution clause naming Mortgagee
as the person to which all payments made by such insurance company shall be
paid, (iii) shall be maintained throughout the term of this Mortgage without
cost to Mortgagee, (iv) shall be delivered to Mortgagee, (v) shall contain such
provisions as Mortgagee deems reasonably necessary or desirable to protect its
interest including, without limitation, endorsements providing that neither
Mortgagor, Mortgagee nor any other party shall be a co-insurer under such
Policies and that Mortgagee shall receive at least thirty (30) days prior
written notice of any modification or cancellation and (vi) shall be
satisfactory in form and substance to Mortgagee (and, in the event of a
Secondary Market Transaction, to the Rating Agencies) and shall be approved by
Mortgagee (and, in the event of a Secondary Market Transaction, by the Rating
Agencies) as to amounts, form, risk coverage, deductibles, loss payees and
insureds. All amounts recoverable thereunder are hereby assigned to the
Mortgagee. Not later than thirty (30) days prior to the expiration date of each
of the Policies, Mortgagor will deliver to Mortgagee satisfactory evidence of
the renewal of each of the Policies.
(d) If the Improvements shall be damaged or destroyed, in whole or in part,
by fire or other casualty, Mortgagor shall give prompt notice thereof to
Mortgagee and prior to the making of any repairs thereto. Following the
occurrence of fire or other casualty, Mortgagor, regardless of whether insurance
proceeds are payable under the Policies or, if paid, are made available to
Mortgagor by Mortgagee, shall promptly proceed with the repair, alteration,
restoration, replacement or rebuilding of the Improvements as near as possible
to their value, utility, condition and character prior to such damage or
destruction. Such repairs, alterations, restoration, replacement and rebuilding
are herein collectively referred to as the "Restoration". The Restoration shall
be performed in accordance with the following provisions:
(i) Mortgagor shall procure, pay for and furnish to Mortgagee true copies of
all required governmental permits, certificates and approvals with respect
to the Restoration.
(ii) Mortgagor shall furnish Mortgagee, within thirty (30) days of the casualty,
evidence reasonably satisfactory to Mortgagee of the cost to complete the
Restoration.
(iii)If the Restoration involves structural work or the estimated cost to
complete the Restoration exceeds five percent (5%) of the original
principal amount of the Loan, the Restoration shall be conducted under the
supervision of an architect (the "Architect") selected by Mortgagor and
approved by Mortgagee (which approval shall not be unreasonably withheld),
and no such Restoration shall be made except in accordance with detailed
plans and specifications, detailed cost estimates and detailed work
schedules approved by Mortgagee (which approval shall not be unreasonably
withheld).
(iv) If the estimated cost of the Restoration shall exceed ten percent (10%) of
the original principal amount of the Loan in the aggregate, at the request
of Mortgagee, Mortgagor, before commencing any work, shall cause to be
furnished to Mortgagee a surety bond or bonds, in form and substance
reasonably satisfactory to Mortgagee, naming Mortgagor and Mortgagee as
co-obligees, in an amount that is not less than the estimated cost of the
Restoration, issued by a surety company or companies reasonably
satisfactory to Mortgagee.
(v) The Restoration shall be prosecuted to completion with all due diligence
and in an expeditious and first class workmanlike manner and in compliance
with all laws and other governmental requirements, all permits,
certificates and approvals, all requirements or fire underwriters and all
insurance policies then in force with respect to the Real Property.
(vi) At all times when any work is in progress, Mortgagor shall maintain all
insurance then required by law or customary with respect to such work, and,
prior to the commencement of any work, shall furnish to Mortgagee duplicate
originals or certificates of the policies therefor.
(vii)Upon completion of the Restoration, Mortgagor shall obtain (A) any
occupancy permit which may be required for the Improvements and (B) all
other governmental permits, certificates and approvals and all permits,
certificates and approvals of fire underwriters which are required for or
with respect to the Restoration, and shall furnish true copies thereof to
Mortgagee.
(viii) An Event of Default (as hereinafter defined) shall be deemed to have
occurred under this Mortgage if Mortgagor, after having commenced
demolition or construction of any Improvements, shall abandon such
demolition or the construction work or shall fail to complete such
demolition and construction within a reasonable time after the commencement
thereof.
(e) Mortgagor and Mortgagee shall jointly adjust and settle all insurance
claims, provided, however, if an Event of Default shall have occurred and be
continuing, Mortgagee shall have the right to adjust and settle such claims
without the prior consent of Mortgagor. In the event of any insured loss, the
payment for such loss shall be made directly to Mortgagee. Any insurance
proceeds payable under any of the Policies may, at the option of Mortgagee, be
used in one or more of the following ways: (w) applied to the Indebtedness,
whether such Indebtedness then be matured or unmatured (such application to be
without prepayment fee or premium, except that if an Event of Default, or an
event which with notice and/or the passage of time, or both, would constitute an
Event of Default, has occurred and remains uncured, then such application shall
be subject to the applicable premium computed in accordance with the Note), (x)
used to fulfill any of the covenants contained herein as the Mortgagee may
determine, (y) used to replace or restore the property to a condition
satisfactory to the Mortgagee, or (z) released to the Mortgagor. Notwithstanding
the foregoing, provided that: (i) not more than fifty percent (50%) of the gross
area of the Improvements is directly affected by such damage, destruction or
loss and the amount of the loss does not exceed fifty percent (50%) of the
original principal amount of the Loan, (ii) no Event of Default or event that
with the passage of time or giving of notice or both would constitute a default
has occurred hereunder, under the Note or under any of the other Loan Documents
and remains uncured at the time of such application, (iii) the insurer does not
deny liability to any named insured, (iv) the Dress Barn Lease (as defined in
Section 5(a) below) shall remain in full force and effect as confirmed in
writing if requested by Mortgagee, (v) rental loss insurance is available and in
force and effect to offset in full any abatement of rent to which any tenant may
be entitled as a result of such damage, destruction or loss, (vi) the remaining
Improvements continue at all times to comply with all applicable building,
zoning and other land use laws and regulations, (vii) in Mortgagee's reasonable
judgment, the Restoration is practicable and can be completed within one (1)
year after the damage, destruction or loss and at least one (1) year prior to
the Maturity Date (as such term is defined in the Note), and (viii) rebuilding
of the Improvements to substantially identical size, condition and use as
existed prior to the casualty is permitted by all applicable laws and ordinances
((i) through (viii), the "Restoration Conditions"), then all of such proceeds
shall be used for Restoration. Any application of insurance proceeds to the
Indebtedness shall be to the unpaid installments of principal due under the Note
in the inverse order of their maturity, such that the regular payments under the
Note shall not be reduced or altered in any manner. In the event the Restoration
Conditions are satisfied (including that no Event of Default or event that, with
the passage of time or giving of notice or both, would constitute a default has
occurred hereunder, under the Note or other Loan Documents) or Mortgagee
otherwise elects to allow the use of such proceeds for the Restoration, such
proceeds shall be disbursed in accordance with the following provisions:
(i) Each request for an advance of insurance proceeds shall be made on seven
(7) days' prior notice to Mortgagee and shall be accompanied by a
certificate of the Architect, if one be required under Paragraph 3(d)(iii)
above, otherwise by an executive officer or managing general partner or
managing member of Mortgagor, stating (A) that all work completed to date
has been performed in compliance with the approved plans and specifications
and in accordance with all provisions of law, (B) the sum requested is
properly required to reimburse Mortgagor for payments by Mortgagor to, or
is properly due to, the contractor, subcontractors, materialmen, laborers,
engineers, architects or other persons rendering services or materials for
the Restoration (giving a brief description of such services and
materials), and that when added to all sums, if any, previously disbursed
by Mortgagee, does not exceed the value of the work done to the date of
such certificate and (C) that the amount of such proceeds remaining in the
hands of Mortgagee will be sufficient on completion of the work to pay the
same in full (giving, in such reasonable detail as Mortgagee may require,
an estimate of the cost of such completion).
(ii) Each request for an advance of insurance proceeds shall, to the extent
permitted under applicable law, be accompanied by waivers of liens
satisfactory to Mortgagee covering that part of the Restoration previously
paid for, if any, and by a search prepared by a title company or by other
evidence reasonably satisfactory to Mortgagee including without limitation
a title endorsement satisfactory to Mortgagee if available in the state
where the Real Property is located, that there has not been filed with
respect to the Real Property any mechanic's lien or other lien or
instrument and that there exist no encumbrances on or affecting the Real
Property other than the Permitted Encumbrances or otherwise approved by
Mortgagee. In addition to the foregoing, the request for the final advance
shall be accompanied by (A) any final occupancy permit which may be
required for the Improvements, (B) all other governmental permits,
certificates and approvals and all other permits necessary for the
occupancy and operation of the Real Property, (C) Tenant estoppels from
tenants whose space was affected and (D) final lien waivers from all
contractors, subcontractors and materialmen.
(iii)No advance of insurance proceeds shall be made if there exists an Event of
Default or event which with the passage of time or the giving of notice or
both would constitute a default on the part of Mortgagor under this
Mortgage, the Note or any other Loan Document.
(iv) If the cost of the Restoration (as reasonably estimated by Mortgagee) at
any time shall exceed the amount of the insurance proceeds available
therefor, insurance proceeds shall not be advanced until Mortgagor, before
commencing the Restoration or continuing the Restoration, as the case may
be, shall deposit the full amount of the deficiency (or other assurances
reasonably satisfactory to Mortgagee such as a letter of credit reasonably
acceptable to Mortgagee) with Mortgagee and the amount so deposited shall
first be applied toward the cost of the Restoration before any portion of
the insurance proceeds is disbursed for such purpose.
Upon completion of the Restoration and payment in full therefor, or upon
failure on the part of Mortgagor promptly to commence or diligently to continue
the Restoration, or at any time upon request by Mortgagor, Mortgagee may apply
the amount of any such proceeds then or thereafter in the hands of Mortgagee to
the payment of the Indebtedness; provided, however, that nothing herein
contained shall prevent Mortgagee from applying at any time the whole or any
part of such proceeds to the curing of any Event of Default that has not been
cured within the applicable cure period under this Mortgage, the Note or any
other Loan Document.
(f) Insurance proceeds and any additional funds deposited by Mortgagor with
Mortgagee shall constitute additional security for the Indebtedness. Mortgagor
shall execute, deliver, file and/or record, at its expense, such documents and
instruments as Mortgagee deems necessary or advisable to grant to Mortgagee a
perfected, first priority security interest in the insurance proceeds and such
additional funds. If Mortgagee elects to have the insurance proceeds applied to
Restoration, (i) the insurance proceeds shall be, at Mortgagee's election,
disbursed in installments by Mortgagee or by a disbursing agent ("Depository")
selected by Mortgagee and whose fees and expenses shall be paid by Mortgagor in
the manner provided in Paragraph 3(e) above and (ii) all costs and expenses
incurred by Mortgagee in connection with the Restoration, including, without
limitation, reasonable counsel fees and costs, shall be paid by Mortgagor.
4. Payment of Taxes, Etc.
(a) Mortgagor shall pay all taxes, assessments, water rates and sewer
rents, now or hereafter levied or assessed or imposed against the Mortgaged
Property or any part thereof (the "Taxes") and all ground rents, maintenance
charges, other governmental impositions, and other charges, including, without
limitation, vault charges and license fees (collectively, "Other Charges") for
the use of vaults, chutes and similar areas adjoining the Real Property, as same
become due and payable. Mortgagor will deliver to Mortgagee, promptly upon
Mortgagee's request, evidence satisfactory to Mortgagee that the Taxes and Other
Charges have been so paid and are not then delinquent. Mortgagor shall not
suffer or permit any lien or charge (including, without limitation, any
mechanic's lien) against all or any part of the Mortgaged Property and Mortgagor
shall promptly cause to be paid and discharged any lien or charge whatsoever
which may be or become a lien or charge against the Mortgaged Property.
Mortgagor shall promptly pay for all utility services provided to the Mortgaged
Property. In addition, Mortgagee may, at its option, retain the services of a
firm to monitor the payment of Taxes, the cost of which shall be borne by
Mortgagor.
(b) Notwithstanding the provisions of subsection (a) of this Paragraph 4,
Mortgagor shall have the right to contest in good faith the amount or validity
of any such Taxes, liens or Other Charges (including, without limitation, tax
liens and mechanics' liens) referred to in subsection (a) above by appropriate
legal proceedings and in accordance with all applicable law, after notice to,
but without cost or expense to, Mortgagee, provided that (i) no Event of Default
or event that, with the passage of time or giving of notice or both, would
constitute a default hereunder, under the Note or other Loan Documents has
occurred and is continuing, (ii) Mortgagor pays such Taxes, liens or Other
Charges as same become due and payable, unless Mortgagor delivers evidence
satisfactory to Mortgagee that, as a result of Mortgagor's contest, Mortgagor's
obligation to pay such Taxes, liens or Other Charges has been deferred by the
appropriate governmental authority, in which event, Mortgagor may defer such
payment of such Taxes, liens or Other Charges until the date specified by such
governmental authority, (iii) such contest shall be promptly and diligently
prosecuted by and at the expense of Mortgagor, (iv) Mortgagee shall not thereby
suffer any civil penalty, or be subjected to any criminal penalties or
sanctions, (v) such contest shall be discontinued and such Taxes, liens or Other
Charges promptly paid if at any time all or any part of the Mortgaged Property
shall be in imminent danger of being foreclosed, sold, forfeited or otherwise
lost or if the lien and security interest created by this Mortgage or the
priority thereof shall be in imminent danger of being impaired, (vi) Mortgagor
shall have set aside adequate reserves (in Mortgagee's judgment) for the payment
of such Taxes, liens or Other Charges, together with all interest and penalties
thereon and (vii) Mortgagor shall have furnished such security as may be
required in the proceeding or as may be requested by Mortgagee, to insure the
payment of any such Taxes, liens or Other Charges, together with all interest
and penalties thereon.
5. Reserve Fund.
(a) Tax and Insurance Fund. Mortgagor shall pay to Mortgagee on the first
day of each calendar month such amounts as Mortgagee from time to time
reasonably estimates to be sufficient to create and maintain a reserve fund from
which (i) to pay the Taxes and Other Charges, at least thirty (30) days prior to
the date they are due without the payment of any penalties or interest, and (ii)
to pay, at least thirty (30) days prior to their due date for the renewal of the
coverage afforded by the Policies upon the expiration thereof, the insurance
premiums for the Policies estimated by Mortgagee to be payable on such due date,
(said amounts in (i) and (ii) above hereafter called the "Tax and Insurance
Fund"). Notwithstanding the foregoing provisions of this clause (a), Mortgagor
shall not be required to create and maintain a reserve fund from which to pay
hazard insurance premiums as long as all of the following conditions remain
satisfied:
(i) no Event of Default shall have occurred and remain uncured;
(ii) the Mortgagor named herein, or a wholly-owned direct or indirect subsidiary
of The Dress Barn, Inc. (The Dress Barn, Inc. is herein referred to as,
"Dress Barn" or "Tenant"), is and shall remain the owner of the Mortgaged
Property;
(iii)Dress Barn shall maintain a minimum net worth of at least $200,000,000,
which net worth shall be reduced by any future stock repurchases by Dress
Barn;
(iv) the lease of the Mortgaged Property from Mortgagor to Tenant as approved by
Mortgagee (the "Dress Barn Lease") (i) continues in full force and effect
and (ii) Tenant is not in default beyond any applicable grace period under
the Dress Barn Lease; and
(v) Mortgagor complies with all of its obligations hereunder and under the
other Loan Documents regarding insurance, including without limitation,
providing Mortgagee with timely evidence (1) that the required insurance is
in place and in full force and effect for the Mortgaged Property and is
never suspended nor are payments for insurance premiums ever delinquent,
and (2) that all insurance premiums are paid in full.
In the event a reserve fund for such insurance premiums shall be required
hereunder, Mortgagor shall have the option of substituting the requirement to
make monthly cash installment payments of such premiums into the Tax and
Insurance Fund with delivery to Mortgagee of a letter of credit payable to
Mortgagee in such amount as Mortgagee estimates to be the annual cost of
insurance. Such letter of credit shall be in form and substance satisfactory to
Mortgagee and from a bank satisfactory to Mortgagee.
Mortgagor shall also have the option of substituting the requirement to
make monthly cash installment payments for Taxes and Other Charges into the Tax
and Insurance Fund with delivery to Mortgagee of a letter of credit in an amount
equal to the annual real estate taxes. Such letter of credit shall be in form
and substance satisfactory to Mortgagee and from a bank satisfactory to
Mortgagee. In the event that Mortgagor elects the option of monthly deposits to
a reserve fund, Mortgagee shall hold such funds in an interest-bearing account
established in a bank, which account and bank shall be acceptable to Mortgagee,
and the costs of setting up such account shall be borne by Mortgagor. Mortgagor
shall execute Mortgagee's Tax and Insurance Escrow Agreement which shall govern
such tax deposit account.
(b) Replacement Reserve Fund. If required by Mortgagee, Mortgagor shall
enter into a Replacement Reserve Agreement which shall require Mortgagor to pay
to Mortgagee on the first day of each calendar month one twelfth (1/12) of the
amount reasonably estimated by Mortgagee to be due for the replacements and
capital repairs required to be made to the Mortgaged Property during each
calendar year (the "Replacement Reserve Fund"). Mortgagee shall timely make
disbursements from the Replacement Reserve Fund on a quarterly basis for items
specified in the Replacement Reserve Agreement as set forth in such Agreement in
amounts reasonably determined by Mortgagee. Mortgagee may require an inspection
of the Mortgaged Property prior to making a disbursement in order to verify
completion of replacements and repairs. Mortgagee reserves the right to make any
disbursement from the Replacement Reserve Fund directly to the party furnishing
materials and/or services. Notwithstanding the foregoing provisions of this
clause (b), Mortgagor shall not be required to create and maintain a reserve
fund for capital repairs and replacements as long as all of the following
conditions are satisfied:
(i) no Event of Default shall have occurred and remain uncured;
(ii) the Mortgagor named herein, or a wholly-owned direct or indirect subsidiary
of Dress Barn, is and shall remain the owner of the Mortgaged Property;
(iii)Mortgagor complies with all of its obligations hereunder regarding
maintaining the Mortgaged Property, including, without limitation,
maintaining the Mortgaged Property in good order and repair;
(iv) Dress Barn shall maintain a minimum net worth of at least $200,000,000,
which net worth shall be reduced by any future stock repurchases by Dress
Barn; and
(v) the Dress Barn Lease (i) continues in full force and effect and (ii) Tenant
is not in default beyond any applicable grace period under the Dress Barn
Lease.
In the event that the suspension of the requirement for replacement
reserves is revoked for any of the aforementioned reasons, Mortgagee shall hold
the Replacement Reserve Fund in an interest-bearing account established in a
bank, which account and bank shall be acceptable to Mortgagee, and the costs of
setting up and maintaining such account shall be borne by the Mortgagor.
Mortgagor shall execute Mortgagee's Replacement Reserve Agreement which shall
govern such Replacement Reserve Fund account. Mortgagor shall have the option of
substituting a letter of credit in an amount equal to the annual reserve
requirement and the required accrued balance in said account in lieu of the
monthly cash deposits. Such letter of credit shall be in form and substance
satisfactory to Mortgagee and from a bank satisfactory to Mortgagee.
(c) Tenant Improvement and Leasing Commission Reserve. If required by
Mortgagee, Mortgagor shall enter into a Tenant Improvement and Leasing
Commission Agreement which shall require Mortgagor to pay to Mortgagee on the
first day of each calendar month deposits for tenant improvements and leasing
commissions in amounts reasonably determined by Mortgagee in its sole
discretion, for payment of costs and expenses incurred by Mortgagor in
connection with the performance of work to refit and release space in the
Improvements that is currently vacant or anticipated to be vacated during the
term of the Loan, and for payment of leasing commissions incurred by Mortgagor
in connection with the releasing of space in the Improvements that is currently
vacant or anticipated to be vacated during the term of the Loan (the "Tenant
Improvement and Leasing Commission Reserve Fund"), all according to the Tenant
Improvement and Leasing Commission Agreement. Notwithstanding the foregoing
provisions of this clause (c), Mortgagor shall not be required to create and
maintain a reserve fund for tenant improvements and leasing commissions as long
as all of the following conditions are satisfied:
(i) no Event of Default shall have occurred and remain uncured;
(ii) the Mortgagor named herein, or a wholly-owned direct or indirect subsidiary
of Dress Barn, is and shall remain the owner of the Mortgaged Property;
(iii)Mortgagor complies with all of its obligations hereunder regarding leases
at the Mortgaged Property;
(iv) Dress Barn shall maintain a minimum net worth of at least $200,000,000,
which net worth shall be reduced by any future stock repurchases by Dress
Barn; and
(v) the Dress Barn Lease (i) continues in full force and effect and (ii) Tenant
is not in default beyond any applicable grace period under the Dress Barn
Lease.
In the event that the suspension of the requirement for tenant improvements
and leasing commissions is revoked for any of the aforementioned reasons,
Mortgagee shall hold the Tenant Improvement and Leasing Commission Reserve Fund
in an interest bearing account established in a bank, which account and bank
shall be acceptable to Mortgagee, and the costs of setting up and maintaining
such account shall be borne by Mortgagor. Mortgagor shall execute Mortgagee's
Tenant Improvement and Leasing Commission Reserve Agreement which shall govern
such Tenant Improvement and Leasing Commission Reserve Fund account. Mortgagor
shall have the option of substituting a letter of credit in an amount equal to
the annual tenant improvement and leasing commissions reserve requirement and
the required accrued balance in said account in lieu of the monthly cash
deposits. Such letter of credit shall be in form and substance satisfactory to
Mortgagee and from a bank satisfactory to Mortgagee.
(d) Repair and Remediation Reserve Fund. If required by Mortgagee at the
closing of the Loan, Mortgagor shall enter into a Reserve Agreement for Repairs
and shall pay to Mortgagee the estimated cost to complete any required repairs
(the "Repair and Remediation Reserve Fund") as more fully set forth in said
Agreement.
The amounts in (a), (b), (c) and (d) above shall hereinafter be
collectively called the "Reserve Fund". Mortgagor hereby pledges to Mortgagee
any and all monies now or hereafter deposited as the Reserve Fund as additional
security for the payment of the Indebtedness. Mortgagee may apply the Reserve
Fund to payments of Taxes, Other Charges, insurance premiums and, as applicable,
payments for replacements and capital repairs, tenant improvements and leasing
commissions and repairs and remediations required to be made by Mortgagor
pursuant to the terms hereof or pursuant to the terms of any other Loan
Documents (even though subsequent owners of the Mortgaged Property may benefit
thereby) in the event that Mortgagor fails to make such payments within
applicable periods; provided, however, if there is an Event of Default which is
continuing, then Mortgagee may credit such Reserve Fund against the Indebtedness
in such priority and proportions as Mortgagee in its discretion shall deem
proper. If the Reserve Fund is not sufficient to fully pay for the Taxes, Other
Charges and/or the insurance premiums or, as applicable, amounts for
replacements and capital repairs, tenant improvements and leasing commissions
and repairs and remediation when due, Mortgagor shall promptly pay to Mortgagee,
upon demand, an amount which Mortgagee shall estimate as sufficient to make up
the deficiency. The Reserve Fund shall not constitute a trust fund and may be
commingled with other monies held by Mortgagee. No earnings or interest on the
Reserve Fund shall be payable to Mortgagor, except as otherwise provided
hereinabove.
6. Condemnation. Mortgagor shall promptly give Mortgagee written notice of
the actual or threatened commencement of any condemnation or eminent domain
proceeding and shall deliver to Mortgagee copies of any and all papers served in
connection with such proceedings. Following the occurrence of a condemnation,
Mortgagor, regardless of whether an award is available, shall promptly proceed
to restore, repair, replace or rebuild the Improvements to the extent
practicable to be of at least equal value and of substantially the same
character as prior to such condemnation (the "Condemnation Restoration"), all to
be effected in accordance with applicable law. Notwithstanding any taking by any
public or quasi-public authority through eminent domain or otherwise (including
but not limited to any transfer made in lieu of or in anticipation of the
exercise of such taking), Mortgagor shall continue to pay the Indebtedness at
the time and in the manner provided for its payment in the Note, in this
Mortgage and the other Loan Documents and the Indebtedness shall not be reduced
until any award or payment therefor shall have been actually received after
expenses of collection and applied by Mortgagee to the discharge of the
Indebtedness. Mortgagor shall cause the award or payment made in any
condemnation or eminent domain proceeding, which is payable to Mortgagor, to be
paid directly to Mortgagee. Mortgagee may, at Mortgagee's election, use the
award in any one or more of the following ways: (a) apply any such award or
payment (for purposes of this Paragraph 6, the award or payment that may be made
in any condemnation or eminent domain proceeding shall mean the entire award
allocated to Mortgagor in any capacity) to the discharge of the Indebtedness
whether or not then due and payable (such application to be without prepayment
fee or premium, except that if an Event of Default, or an event which with
notice and/or the passage of time, or both, would constitute an Event of
Default, has occurred and is continuing, then such application shall be subject
to the applicable premium computed in accordance with the Note), (b) use the
same or any part thereof to fulfill any of the covenants contained herein as the
Mortgagee may determine, (c) use the same or any part thereof to replace or
restore the Mortgaged Property to a condition satisfactory to the Mortgagee, or
(d) release the same to the Mortgagor; provided, however, if (i) the amount of
the award is not more than $100,000, (ii) the condemnation does not cause the
default or termination of any lease of the Property, (iii) the continued
compliance of the Property with applicable loss, regulations and codes,
including without limitation, zoning ordinances, and (iv) the ordinary use
occupancy and access of the Property is not adversely affected, then Mortgagee
shall elect clause (c) above. If the Mortgaged Property is sold, through
foreclosure or otherwise, prior to the receipt by Mortgagee of such award or
payment, Mortgagee shall have the right, whether or not a deficiency judgment on
the Note shall have been sought, recovered or denied, to receive said award or
payment or a portion thereof sufficient to pay the Indebtedness.
7. Leases and Rents.
(a) Mortgagor does hereby absolutely and unconditionally assign to
Mortgagee its right, title and interest in all current and future Leases and
Rents and all proceeds from the sale, cancellation, surrender or other
disposition of the Leases, it being intended by Mortgagor that this assignment
constitutes a present, absolute assignment and not an assignment for additional
security only. Such assignment to Mortgagee shall not be construed to bind
Mortgagee to the performance of any of the covenants, conditions or provisions
contained in any such Lease or otherwise to impose any obligation upon
Mortgagee. Mortgagor agrees to execute and deliver to Mortgagee such additional
instruments in form and substance satisfactory to Mortgagee, as may hereafter be
requested by Mortgagee to further evidence and confirm such assignment.
Nevertheless, subject to the terms of this Paragraph 7, Mortgagee grants to
Mortgagor a revocable license to operate and manage the Mortgaged Property and
to collect the Rents. Mortgagor shall hold the Rents, or a portion thereof
sufficient to discharge all current sums due on the Indebtedness, in trust for
the benefit of Mortgagee for use in the payment of such sums. The grant of the
foregoing license is subject to the provisions of Paragraph 1 of the separate
Assignment of Leases and Rents of even date herewith granted by the Mortgagor as
"Assignor" to the Mortgagee as "Assignee" with respect to the Mortgaged Property
("Assignment of Leases and Rents"). Upon the occurrence of an Event of Default,
the license granted to Mortgagor herein shall be automatically revoked and
Mortgagee shall immediately be entitled to possession of all Rents, whether or
not Mortgagee enters upon or takes control of the Mortgaged Property. Mortgagee
is hereby granted and assigned by Mortgagor the right, at its option, upon the
revocation of the license granted herein to enter upon the Mortgaged Property in
person, by agent or by court-appointed receiver to collect the Rents. Any Rents
collected after the revocation of the license herein granted may be applied
toward payment of the Indebtedness in such priority and proportion as Mortgagee
in its discretion shall deem proper. It is further the intent of Mortgagor and
Mortgagee that the Rents hereby absolutely assigned are no longer, during the
term of this Mortgage, property of Mortgagor or property of any estate of
Mortgagor as defined in Section 541 of the Bankruptcy Code and shall not
constitute collateral, cash or otherwise, of Mortgagor. The term "Rents" as used
herein shall mean the gross rents without deduction or offsets of any kind.
(b) All Leases executed after the date of this Mortgage shall provide that
they are subordinate to this Mortgage and that the lessee agrees to attorn to
Mortgagee; provided, however, that nothing herein shall affect Mortgagee's right
to designate from time to time any one or more Leases as being superior to this
Mortgage and Mortgagor shall execute and deliver to Mortgagee and shall cause to
be executed and delivered to Mortgagee from each tenant under such Lease any
instrument or agreement as Mortgagee may deem necessary to make such Lease
superior to this Mortgage. Upon request, Mortgagor shall promptly furnish
Mortgagee with executed copies of all Leases.
(c) Mortgagor shall not, without the prior consent of Mortgagee, (i) lease
all or any part of the Mortgaged Property, (ii) alter or change the terms of any
Lease or cancel or terminate, abridge or otherwise modify the terms of any
Lease, provided, however, that Mortgagor may modify, amend, surrender, cancel or
terminate any Lease in the Mortgaged Property, other than the Dress Barn Lease,
so long as (aa) the Dress Barn Lease shall provide that in the event that any
space at the Mortgaged Property is no longer subject to a Lease due to another
building tenant's lease expiration, lease default or otherwise, the Dress Barn
Lease shall automatically spread over and incorporate as demised premises such
other tenant's space at a rent equal to the most recent rent paid by the
previous third party tenant and otherwise on the same terms and provisions as
the Dress Barn Lease, including, but not limited to, containing an expiration
date of March 31, 2023, and upon such spreading and incorporation, such
additional space shall be deemed to be space demised under the Dress Barn Lease
for all purposes, and (bb) Dress Barn shall have and maintain a minimum net
worth as determined by Mortgagee of at least $225,000,000, which net worth
requirement shall be reduced by the amount of any stock repurchases made by
Dress Barn after the date of this Mortgage, (iii) consent to any assignment of
or subletting under any Lease not in accordance with its terms, provided,
however, that Dress Barn may sublease space demised under the Dress Barn Lease
to third parties without Mortgagee's consent, provided that Dress Barn remains
primarily liable for all space demised under the Dress Barn Lease, (iv) cancel,
terminate, abridge or otherwise modify any guaranty of any Lease or the terms
thereof, (v) collect or accept prepayments of installments of Rents for a period
of more than one (1) month in advance other than security deposits received in
the ordinary course of business or (vi) further assign the whole or any part of
the Leases or the Rents, provided, however, that
(d) With respect to each Lease, Mortgagor shall (i) observe and perform
each and every provision thereof on the lessor's part to be fulfilled or
performed under each Lease and not do or permit to be done anything to impair
the value of the Lease as security for the Loan, including surrender or
voluntary termination of any Lease, (ii) promptly send to Mortgagee copies of
all notices of default which Mortgagor shall send or receive thereunder, (iii)
enforce all of the terms, covenants and conditions contained in such Lease upon
the lessee's part to be performed, short of termination thereof, (iv) execute
and deliver, at the request of Mortgagee, all such further assurances,
confirmations and assignments in connection with the Mortgaged Property as
Mortgagee shall, from time to time, require and (v) upon request, furnish
Mortgagee with executed copies of all Leases. Upon the occurrence of any Event
of Default under this Mortgage, Mortgagor shall pay, at Mortgagee's option
monthly in advance to Mortgagee, or any receiver appointed to collect the Rents,
the fair and reasonable rental value for the use and occupation of the Mortgaged
Property or part of the Mortgaged Property as may be occupied by Mortgagor or
any one Mortgagor and upon default in any such payment Mortgagor shall vacate
and surrender possession of the Mortgaged Property to Mortgagee or to such
receiver and, in default thereof, Mortgagor may be evicted by summary
proceedings or otherwise.
(e) All security deposits of tenants, whether held in cash or any other
form, shall not be commingled with any other funds of Mortgagor and, if cash,
shall be deposited by Mortgagor at such commercial or savings bank or banks as
may be reasonably satisfactory to Mortgagee. Any bond or other instrument which
Mortgagor is permitted to hold in lieu of cash security deposits under any
applicable legal requirements shall be maintained in full force and effect in
the full amount of such deposits unless replaced by cash deposits as hereinabove
described, shall be issued by an institution reasonably satisfactory to
Mortgagee, shall, if permitted pursuant to any legal requirements, name
Mortgagee as payee or Mortgagee thereunder (or at Mortgagee's option, be fully
assignable to Mortgagee) and shall, in all respects, comply with any applicable
legal requirements and otherwise be reasonably satisfactory to Mortgagee.
Mortgagee hereby understands and agrees that Mortgagee shall not have approval
rights with respect to the existing letters of credit held as security deposits
under leases of the Property, but that Mortgagee's approval shall be required
with respect to any renewal or replacement thereof. Mortgagor shall, upon
request, provide Mortgagee with evidence reasonably satisfactory to Mortgagee of
Mortgagor's compliance with the foregoing. Following the occurrence and during
the continuance of any Event of Default, Mortgagor shall, upon Mortgagee's
request, if permitted by any applicable legal requirements, turn over to
Mortgagee the security deposits (and any interest theretofore earned thereon)
with respect to all or any portion of the Mortgaged Property, to be held by
Mortgagee subject to the terms of the Leases.
8. Maintenance and Use of Mortgaged Property. Mortgagor shall keep and
maintain at its sole cost and expense, or shall cause Dress barn or any other
tenant at the Mortgaged Property under a Lease to keep and maintain, the
Mortgaged Property, including, without limitation, parking lots and recreational
and landscaped portions thereof, if any, in good order and condition. The
Improvements and the Equipment shall not be diminished, removed, demolished or
materially altered (except for normal replacement of Equipment) and Mortgagor
shall not erect any new buildings, structures or building additions on the
Mortgaged Property without the prior consent of Mortgagee. So long as no Event
of Default shall have occurred and be continuing, Mortgagor shall have the right
at any time and from time to time after providing Mortgagee with written notice
to make or cause to be made reasonable alterations of and additions to the
Mortgaged Property or any part thereof, provided that any alteration or addition
(i) shall not change the general character of the Mortgaged Property or reduce
the fair market value thereof below its value immediately before such alteration
or addition, or impair the usefulness of the Mortgaged Property, (ii) is
effected with due diligence, in a good and workmanlike manner and in compliance
with all applicable laws and with all provisions of any insurance policy
covering or applicable to the Mortgaged Property and all requirements of the
issuers thereof, (iii) is promptly and fully paid for, or caused to be paid for,
by Mortgagor, (iv) the estimated cost of such alteration or addition does not
exceed five percent (5%) of the original principal amount of the Loan, and (v)
is made under the supervision of a qualified architect or engineer, (vi) shall
not violate the terms of any Leases, and (vii) upon completion, Mortgagor shall
provide Mortgagee with (aa) a satisfactory final improvement survey if the
footprint of the building has been altered, (bb), any final occupancy permit
which may be required for the Improvements, (cc) all other governmental permits,
certificates and approvals and all other permits, certificates and approvals of
fire underwriters which are required with respect to the alterations and
additions and the use and occupancy thereof, and shall furnish true copies
thereof to Mortgagee, and (dd) final lien waivers from all contractors,
subcontractors and materialmen. Mortgagee acknowledges that Par Pharmacutical,
Inc., a tenant currently at the Mortgaged Property, is currently constructing
certain tenant improvements to its premises as described in the Borrower's
Certificate, which are not subject to the foregoing provisions of this Paragraph
8. Mortgagor shall promptly comply with all laws, orders and ordinances
affecting the Mortgaged Property, or the use thereof, provided, however, that
nothing in the foregoing clause shall require Mortgagor to comply with any such
law, order or ordinance so long as Mortgagor shall in good faith, after notice
to, but without cost or expense to, Mortgagee, contest the validity of such law,
order or ordinance by appropriate legal proceedings and in accordance with all
applicable law, which proceedings must operate to prevent (i) the enforcement
thereof, (ii) the payment of any fine, charge or penalty, (iii) the sale or
forfeiture of the Mortgaged Property or any part thereof, (iv) the lien of this
Mortgage and the priority thereof from being impaired, (v) the imposition of
criminal liability on Mortgagee and (vi) the imposition, unless stayed, of civil
liability on Mortgagee; provided that during such contest Mortgagor shall, at
the option of Mortgagee, provide cash, bonds or other security satisfactory to
Mortgagee, indemnifying and protecting Mortgagee against any liability, loss or
injury by reason of such non-compliance or contest, and provided further, that
such contest shall be promptly and diligently prosecuted by and at the expense
of Mortgagor. Mortgagor shall promptly, at its sole cost and expense, repair,
replace or rebuild any part of the Mortgaged Property which may be destroyed by
any casualty, or become damaged, worn or dilapidated. Mortgagor shall not commit
any waste at the Mortgaged Property. Mortgagor shall not initiate, join in,
acquiesce in or consent to any change in any private restrictive covenant,
zoning law or other public or private restriction, limiting or defining the uses
which may be made of the Mortgaged Property or any part thereof. If under
applicable zoning provisions the use of all or any portion of the Mortgaged
Property is or shall become a nonconforming use, Mortgagor will not cause or
permit such nonconforming use to be discontinued or abandoned without the
express consent of Mortgagee. Mortgagor covenants and agrees that it shall
operate the Mortgaged Property at all times as a first-class office, warehouse
and distribution facility and a warehouse retail outlet.
9. Transfer or Encumbrance of the Mortgaged Property or Interests in the
Mortgagor; Other Indebtedness .
(a) Mortgagor acknowledges that Mortgagee has examined and relied on the
creditworthiness and experience of Mortgagor in owning and operating properties
such as the Mortgaged Property in agreeing to make the Loan, and that Mortgagee
will continue to rely on Mortgagor's ownership of the Mortgaged Property as a
means of maintaining the value of the Mortgaged Property as security for
repayment of the Indebtedness. Mortgagor acknowledges that Mortgagee has a valid
interest in maintaining the value of the Mortgaged Property so as to ensure
that, should Mortgagor default in the repayment of the Indebtedness, Mortgagee
can recover the Indebtedness by a sale of the Mortgaged Property. Mortgagor
shall not, without the prior written consent of Mortgagee, sell, convey,
alienate, mortgage, encumber, pledge or otherwise transfer the Mortgaged
Property or any part thereof or interest therein, or permit the Mortgaged
Property or any part thereof to be sold, conveyed, alienated, mortgaged,
encumbered, pledged or otherwise transferred.
(b) A sale, conveyance, alienation, mortgage, encumbrance, pledge or
transfer within the meaning of this Paragraph 9 shall be deemed to include (i)
an installment sales agreement wherein Mortgagor agrees to sell the Mortgaged
Property or any part thereof for a price to be paid in installments, (ii) an
agreement by Mortgagor leasing all or a substantial part of the Mortgaged
Property for other than actual occupancy by a space tenant thereunder or a sale,
assignment or other transfer of, or the grant of a security interest in,
Mortgagor's right, title and interest in and to any Leases or any Rents, (iii)
if Mortgagor, any guarantor of Non-Recourse Carveout Obligations (as hereinafter
defined), any other guarantor, any indemnitor of environmental liabilities or
any general partner or managing member of Mortgagor or of any such guarantor or
indemnitor is a corporation, the voluntary or involuntary sale, assignment,
conveyance or transfer of such corporation's stock (or the stock of any
corporation directly or indirectly controlling such corporation by operation of
law or otherwise) or the creation or issuance of new stock in one or a series of
transactions by which an aggregate of more than ten percent (10%) of such
corporation's stock shall be vested in a party or parties who are not now
stockholders or any change in the control of such corporation, (iv) if
Mortgagor, any guarantor, of Non-Recourse Carveout Obligations, any other
guarantor or any indemnitor of environmental liabilities or any general partner
or managing member of Mortgagor or any such guarantor or indemnitor is a limited
or general partnership, joint venture or limited liability company, the change,
removal, resignation or addition of a general partner, managing partner, limited
partner, joint venturer or member or the transfer of the partnership interest of
any general partner, managing partner or limited partner or the transfer of the
interest of any joint venturer or member, and (v) if Mortgagor, any guarantor of
Non-Recourse Carveout Obligations or any other guarantor or any indemnitor of
environmental liabilities, is an entity, whether one of the above-mentioned
entities or not, any change in the ownership or control of such entity, any
merger, consolidation or dissolution or syndication affecting such entity, or
the transfer, sale, assignment or pledge of any interest in such entity or in
any person, directly or indirectly, controlling such entity or in any general
partner or managing member thereof, whether at one time or in a series of
related transactions.
(c) Mortgagee shall not be required to demonstrate any actual impairment of
its security or any increased risk of default hereunder in order to declare the
Indebtedness immediately due and payable upon Mortgagor's sale, conveyance,
alienation, mortgage, encumbrance, pledge or transfer of the Mortgaged Property
without Mortgagee's consent. This provision shall apply to every sale,
conveyance, alienation, mortgage, encumbrance, pledge or transfer of the
Mortgaged Property regardless of whether voluntary or not, or whether or not
Mortgagee has consented to any previous sale, conveyance, alienation, mortgage,
encumbrance, pledge or transfer of the Mortgaged Property.
(d) Mortgagee's consent to a sale, conveyance, alienation, mortgage,
encumbrance, pledge or transfer of the Mortgaged Property or any other action
described in this Paragraph 9 shall not be deemed to be a waiver of Mortgagee's
right to require such consent to any future occurrence of same. Any sale,
conveyance, alienation, mortgage, encumbrance, pledge or transfer of the
Mortgaged Property or other action made in contravention of this Paragraph 9
shall be null and void and of no force and effect.
(e) Mortgagor agrees to bear and shall pay or reimburse Mortgagee on demand
for all reasonable expenses (including, without limitation, reasonable
attorneys' fees and disbursements, title search costs and title insurance
endorsement premiums) incurred by Mortgagee in connection with the review,
approval and documentation of any such sale, conveyance, alienation, mortgage,
encumbrance, pledge or transfer.
(f) Notwithstanding the foregoing, Mortgagee shall permit a one-time sale
or transfer of the Mortgaged Property, provided that:
(i) no Event of Default or event which with the giving of notice or passage of
time would constitute an Event of Default shall have occurred and remain
uncured;
(ii) the proposed transferee ("Transferee"), the guarantors of Non-Recourse
Carveout Obligations, any other guarantor, and the indemnitors of
environmental liabilities shall be reputable entities or persons of good
character, creditworthy, with sufficient financial worth considering the
obligations assumed and undertaken, as evidenced by financial statements
and other information reasonably requested by Mortgagee;
(iii)the Transferee and its property manager shall have sufficient experience
in the ownership and management of properties similar to the Mortgaged
Property, and Mortgagee shall be provided with reasonable evidence thereof
(and Mortgagee reserves the right to approve the Transferee without
approving the substitution of the property manager);
(iv) that Mortgagee has received a written request for approval from the
Mortgagor at least sixty (60) days prior to the proposed transfer
(including a description of the proposed terms of the transfer), together
with a diagram showing the legal structure of the Transferee, the proposed
guarantors of Non-Recourse Carveout Obligations, any other proposed
guarantors, and the proposed indemnitors of environmental liabilities and
all of the constituent entities of each, after the contemplated transfer,
and a list of the names, types of interests and ownership percentages of
all persons to have ownership interests in any of the foregoing or any
constituent entity thereof, financial statements for all such entities and
an administrative fee of $5,000, which shall be deemed fully earned on the
date of receipt and shall be retained by Mortgagee regardless of whether or
not the transfer occurs and whether or not approval is given;
(v) Mortgagee and its counsel have received (aa) certification from Mortgagor
and the Transferee that the proposed terms of the transfer described in
subparagraph 9(f)(iv) are the actual terms of the transfer, (bb) evidence
of casualty insurance and other applicable insurance, (cc) all corporate,
partnership or other entity documents and (dd) all other certificates,
legal opinions, title materials and other documents which Mortgagee may
reasonably require, all in form and substance reasonably satisfactory to
Mortgagee, at least thirty (30) days prior to the proposed transfer;
(vi) Mortgagee be provided reasonably satisfactory evidence concerning the
effect of any change in the real estate taxes to result from the sale and
the effect of such change on the ability of the Mortgaged Property to
generate a cash flow sufficient to pay the debt service on the Loan and to
maintain a debt service coverage ratio satisfactory to Mortgagee;
(vii)to the extent applicable, Mortgagee shall have received in writing
evidence from the Rating Agencies to the effect that such transfer will not
result in a re-qualification, reduction or withdrawal of any rating
initially assigned or to be assigned in a Secondary Market Transaction
together with such legal opinions as may be requested by the Rating
Agencies. The term "Rating Agencies" as used herein shall mean each of
Standard & Poor's Ratings Group, Xxxxx'x Investors Service, Inc., Duff &
Xxxxxx Credit Rating Co., Fitch Investors Service, Inc. or any other
nationally-recognized statistical rating agency who shall then be rating
the certificates or securities issued in connection with the Secondary
Market Transaction;
(viii) the Transferee and its constituent entities shall comply with all of the
Single Purpose Entity/Separateness requirements set forth in Paragraph 19
hereof;
(ix) the Transferee shall have executed and delivered to Mortgagee an assumption
agreement in form and substance acceptable to Mortgagee, evidencing such
Transferee's agreement to abide and be bound by the terms of the Note, this
Mortgage and the other Loan Documents, together with an executed guaranty
of Non-Recourse Carveout Obligations and any other guaranty from an
approved guarantor and an executed separate environmental indemnity
agreement from an approved indemnitor, all in form and substance reasonably
acceptable to Mortgagee, and such legal opinions and title insurance
endorsements as may be reasonably requested by Mortgagee; and
(x) Mortgagee shall have received an assumption fee equal to one percent (1%)
of the then unpaid principal balance of the Note (against which the
administrative fee shall be credited) in addition to the payment of all
costs and expenses incurred by Mortgagee in connection with such assumption
(including reasonable attorney's fees and costs).
In the event all of the foregoing conditions are satisfied and Mortgagee
consents to the sale or transfer, Mortgagee agrees to release (aa) the
transferor Mortgagor and the prior guarantors of Non-Recourse Carveout
Obligations with respect to matters first arising solely after the transfer, and
(bb) the prior indemnitors of environmental liabilities with respect to a
presence and/or release which first occurs solely after the transfer; provided,
however, the transferor Mortgagor, the prior guarantors and the prior
indemnitors, respectively, shall have the burden of proving that all the
conditions in this Paragraph 9 (including, without limitation, the time as to
which matters described herein arose) were satisfied by clear and convincing
evidence and shall continue to defend with counsel satisfactory to Mortgagee and
shall indemnify and hold Mortgagee harmless for all matters set forth in
Paragraph 39 and in the Non-Recourse Carveout Obligations unless and until a
court of competent jurisdiction finds that such transferor Mortgagor, prior
guarantors or prior indemnitors, respectively, met such burden.
(g) Notwithstanding the foregoing, as long as all of the Internal Transfer
Conditions (as defined below) are satisfied prior to any of the following
transfers, it shall not be a default hereunder for any member of Mortgagor to
transfer ownership interests in Mortgagor to an Affiliate (collectively, the
"Internal Transfers").
The term "Internal Transfer Conditions" shall mean that all of the
following are satisfied:
(1) No Event of Default or event which, with the passage of time or giving of
notice, or both, would constitute an Event of Default, shall have occurred
under the Loan Documents;
(2) The description of Mortgagor and all constituent entities and the list of
names, types of interests and percentages thereof of all persons having
ownership interests in Mortgagor as set forth in Exhibit F attached to the
Borrower's Certificate delivered by Mortgagor to Mortgagee at the closing
of this Loan and as of the date hereof shall have been accurate and
complete, and Mortgagor hereby represents that the same is accurate and
complete.
(3) No such transfer of interest shall result in a change of control of
Mortgagor or a change in the control of the day to day operation of the
Mortgaged Property, and Dress Barn shall continue to own at least 51%
direct ownership interests in Mortgagor, and shall continue to control
Mortgagor and the day to day operations of the Mortgaged Property,
(4) Without limiting the foregoing, no such transfer, either singly or in the
aggregate with other transfers, will result in a violation of the special
purpose entity provisions of the Loan Documents or Mortgagor's
organizational documents as set forth in Section 19 below;
(5) Mortgagor shall have provided to Mortgagee prior written notice of any such
transfer together with information in the form of completed Exhibits F and
H of the application for this Loan for the proposed transferee and a
diagram showing the structure of the Mortgagor and all of its constituent
entities after the contemplated transfer and a list of the names, types of
interest and percentages of ownership of all owners of interests in the
Mortgagor and any constituent entities after such transfer;
(6) Mortgagor shall pay to Mortgagee an administrative fee of $1,500 for the
costs incurred by Mortgagee to review the proposed transfer, which shall be
deemed fully earned upon receipt; and
(7) Mortgagor shall pay all reasonable fees and costs in connection with any
such transfer, including without limitation, Mortgagee's reasonable
attorneys' fees.
Definitions: The term control or controlling shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of
management, policies or activities of a person or entity, whether through
ownership of voting securities or other interests, by contract or otherwise.
Affiliate shall mean in the case of a corporate member of a limited
liability company borrower ("LLC"), any person or entity other than the special
purpose, bankruptcy remote corporation serving as a member of the LLC (the
"Corporation"), (i) which owns beneficially, directly or indirectly, any
outstanding shares of the Corporation's stock or any membership interest in the
LLC, or (ii) which controls or is under common control with the Corporation or
the LLC.
(h) Anything to the contrary not withstanding, the foregoing terms,
covenants and conditions of this Paragraph 9 shall not apply to (i) changes in
ownership or control of Dress Barn, (ii) any merger, consolidation, dissolution
or syndication affecting Dress Barn, (iii) any transfer, sale, assignment or
pledge of any interest in Dress Barn, or (iv) any entity or person directly or
indirectly controlling or owning any interest in Dress Barn (except Mortgagor if
applicable).
(i) Mortgagor has not incurred and will not incur any indebtedness, secured
or unsecured, other than the Loan and debt (i) incurred in the ordinary course
of business to vendors and suppliers of services to the Mortgaged Property, (ii)
not secured by the Mortgaged Property, or any portion thereof, or by interests
in the Mortgagor or any constituent entity thereof, and (iii) not accompanied by
any rights to control or to obtain control of the Mortgagor or any constituent
entity thereof. No indebtedness other than the Loan may be secured (subordinate
or pari passu) by the Mortgaged Property, or any portion thereof, or by
interests in the Mortgagor or any constituent entity thereof. This subparagraph
(i) shall not apply to Dress Barn or to any entity or person directly or
indirectly controlling or owning an interest in Dress Barn (except Mortgagor).
10. Estoppel Certificates.
(a) Mortgagor, within ten (10) business days after request by Mortgagee,
shall furnish Mortgagee from time to time with a statement, duly acknowledged
and certified, setting forth (i) the amount of the original principal amount of
the Note, (ii) the unpaid principal amount of the Note, (iii) the rate of
interest in the Note, (iv) the date through which all installments of interest,
commitment fees and/or principal have been paid, (v) any offsets or defenses to
the payment of the Indebtedness, if any, (vi) that the Note and this Mortgage
have not been modified or if modified, giving particulars of such modification
and (vii) such other information as shall be requested by Mortgagee.
(b) Mortgagor, after request by Mortgagee, will obtain and furnish (within
the time periods, if any, provided in the applicable Leases or if no time period
is so specified, within ten (10) business days after request) Mortgagee from
time to time with estoppel certificates from any tenants under then existing
Leases, which certificates shall be in form and substance as required by such
Leases, or if not required, then in form and substance reasonably satisfactory
to Mortgagee.
11. No Cooperative or Condominium. Mortgagor represents and warrants that
the Mortgaged Property has not been subjected to a cooperative or condominium
form of ownership. Mortgagor hereby covenants and agrees that it will not file a
declaration of condominium, map or any other document having the effect of
subjecting the Mortgaged Property, to a condominium or cooperative form of
ownership.
12. Changes in the Laws Regarding Taxation. If any law is enacted or
adopted or amended after the date of this Mortgage which deducts the
Indebtedness or any portion thereof from the value of the Mortgaged Property for
the purpose of taxation or which imposes a tax, either directly or indirectly,
on the principal amount of the Note or Mortgagee's interest in the Mortgaged
Property, Mortgagor will pay such tax, with interest and penalties thereon, if
any. In the event Mortgagee is advised by counsel chosen by it that the payment
of such tax or interest and penalties by Mortgagor would be unlawful or taxable
to Mortgagee or unenforceable or provide the basis for a defense of usury, then
in any such event, Mortgagee shall have the option, by notice of not less than
sixty (60) days, to declare the Indebtedness immediately due and payable without
prepayment fee or premium, except that if an Event of Default has occurred and
is continuing, the applicable premium computed in accordance with the Note shall
apply.
13. No Credits on Account of the Indebtedness. Mortgagor will not claim or
demand or be entitled to any credit or credits on account of the Indebtedness
for any part of the Taxes assessed against the Mortgaged Property or any part
thereof and no deduction shall otherwise be made or claimed from the taxable
value of the Mortgaged Property, or any part thereof, by reason of this Mortgage
or the Indebtedness. In the event such claim, credit or deduction shall be
required by law, Mortgagee shall have the option, by notice of not less than
sixty (60) days, to declare the Indebtedness immediately due and payable without
prepayment fee or premium, except that if an Event of Default has occurred, the
applicable premium computed in accordance with the Note shall apply.
14. Documentary Stamps. 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 or this Mortgage, or impose any other tax
or charge on the same, Mortgagor will pay for the same, with interest and
penalties thereon, if any.
15. Right of Entry. Mortgagee and its agents shall have the right to enter
and inspect the Mortgaged Property at any time during reasonable business hours
upon twenty-four (24) hour notice to Mortgagor, except in the case of an
emergency, in which event Mortgagee and its agents may enter and inspect the
Mortgaged Property at any time.
16. Books and Records.
(a) Mortgagor will maintain full, accurate and complete books of accounts
and other records reflecting the results of the operations of the Mortgaged
Property as well as its other operations and will furnish, or cause to be
furnished, to Mortgagee the following:
(i) within one hundred twenty (120) days after the end of each fiscal year, the
Mortgagor will furnish to Mortgagee, a statement of Mortgagor's financial
condition, including a balance sheet and profit and loss statement, and a
statement of annual income and expenses reasonably satisfactory in form and
substance to Mortgagee in connection with the operation of the Mortgaged
Property, in detail reasonably satisfactory to Mortgagee, prepared by,
audited and certified by a certified public accountant who is a member of
the American Institute of Certified Public Accountants and, in addition,
within forty-five (45) days after the end of each fiscal quarter of
Mortgagor, Mortgagor shall provide the above information except that it may
be prepared and certified by the financial officer of Mortgagor who is
responsible for the preparation of such annual financial statements.
(ii) accompanying the submission of the certified statements of annual and
quarterly income and expenses, shall be a certified current rent roll,
which shall include, among other things, tenant names, lease commencement
and expiration dates, square footage, annual rent, annual operating expense
and real estate tax contributions, a statement as to whether or not there
are any purchase options and/or co-tenancy requirements, and any and all
other fees paid by tenants and security deposits currently held.
(iii)accompanying the submission of the certified statements of annual and
quarterly income and expenses shall be such additional financial
information as Mortgagee shall require.
(iv) The foregoing provisions of this subparagraph (a) to the contrary
notwithstanding, Mortgagee shall accept statements of annual income and
expenses prepared and certified by Mortgagor, Mortgagor's accountant or a
financial officer of Mortgagor, provided that statements of annual income
and expenses certified by a certified public accountant are not available
(it being understood that Mortgagor has no obligation to assure that any
such certified statements are available) and there has not been an Event of
Default by Mortgagor in the performance of any of its obligations under the
Loan Documents. Notwithstanding the foregoing, if a statement certified by
a certified public accountant has been prepared for Mortgagor, such
statement shall be provided to Mortgagee. Mortgagee shall accept financial
statements prepared for Dress Barn in the ordinary course of its business.
(b) Mortgagee shall have the right, upon five (5) days' prior notice to
Mortgagor, to inspect and make copies of Mortgagor's books and records and
income tax returns and notices.
(c) In the event of a Secondary Market Transaction, Mortgagor shall furnish
from time to time such information relating to Mortgagor and the Mortgaged
Property as shall be requested by the Rating Agencies.
17. Performance of Other Agreements. Mortgagor shall observe and perform
each and every term to be observed or performed by such Mortgagor pursuant to
the terms of any agreement or recorded instrument affecting or pertaining to the
Mortgaged Property.
18. Representations and Covenants Concerning Loan. Mortgagor represents,
warrants and covenants as follows:
(a) The Note, this Mortgage and the other Loan Documents are not subject to
any right of rescission, set-off, counterclaim or defense, including the defense
of usury, nor would the operation of any of the terms of the Note, this Mortgage
and the other Loan Documents, or the exercise of any right thereunder, render
this Mortgage unenforceable, in whole or in part, or subject to any right of
rescission, set-off, counterclaim or defense, including the defense of usury.
(b) To Mortgagor's knowledge, after diligent inquiry, on all
certifications, permits, licenses and approvals, including, without limitation,
certificates of completion and occupancy permits required for the legal use,
occupancy of the Mortgaged Property, have been obtained and are in full force
and effect. To Mortgagor's knowledge after diligent inquiry the Mortgaged
Property is free of material damage and is in good repair, and there is no
proceeding pending for the total or partial condemnation of, or affecting, the
Mortgaged Property.
(c) Except as shown on the survey of the Mortgaged Property accepted by
Mortgagee at the closing of this Loan or set forth in the Title Insurance Policy
accepted by Mortgagee at the closing of this Loan, issued by Commonwealth Land
Title Insurance Company, all of the Improvements which were included in
determining the appraised value of the Mortgaged Property lie wholly within the
boundaries and building restriction lines of the Mortgaged Property, and no
improvements on adjoining properties encroach upon the Mortgaged Property, and
no easements or other encumbrances upon the Land encroach upon any of the
Improvements, so as to affect the value or marketability of the Mortgaged
Property except those which are insured against by title insurance. To
Mortgagor's knowledge after diligent inquiry, all of the Improvements comply
with all requirements of applicable zoning and subdivision laws and ordinances
in all material respects.
(d) The Mortgaged Property is not subject to any Leases other than the
Leases described in the rent roll delivered to Mortgagee in connection with this
Mortgage. To Mortgagor's knowledge after diligent inquiry, no person has any
possessory interest in the Mortgaged Property or right to occupy the same except
under and pursuant to the provisions of the Leases. Except as otherwise
disclosed in writing to Mortgagee, the current Leases are in full force and
effect, Mortgagor is not in default thereunder and to Mortgagor's knowledge
there are no defaults by any tenant thereunder and there are no conditions that,
with the passage of time or the giving of notice, or both, would constitute
defaults by any tenant thereunder. Except as otherwise disclosed in writing to
Mortgagee, all presently existing Leases are subordinate to the Mortgage.
(e) To Mortgagor's knowledge after diligent inquiry, the Mortgaged Property
and the Lease are in compliance with all statutes, ordinances, regulations and
other governmental or quasi-governmental requirements and private covenants now
or hereafter relating to the ownership, construction, use or operation of the
Mortgaged Property.
(f) There has not been and shall never be committed by Mortgagor or any
other person in occupancy of or involved with the operation or use of the
Mortgaged Property any act or omission affording the federal government or any
state or local government the right of forfeiture as against the Mortgaged
Property or any part thereof or any monies paid in performance of Mortgagor's
obligations under any of the Loan Documents. Mortgagor hereby covenants and
agrees not to commit, permit or suffer to exist any act or omission affording
such right of forfeiture.
(g) The Management Agreement dated June ___, 2003 (the "Management
Agreement") between Mortgagor and The Dress Barn, Inc. ("Manager") pursuant to
which Manager operates the Mortgaged Property (a true, correct and complete copy
of which has been delivered to Mortgagee) is in full force and effect and there
is no default or violation by any party thereunder. The fee due under the
Management Agreement, and the terms and provisions of the Management Agreement,
are subordinate to this Mortgage and the Manager shall attorn to Mortgagee.
Mortgagor shall not terminate, cancel, modify, renew or extend the Management
Agreement, or enter into any agreement relating to the management or operation
of the Mortgaged Property with Manager or any other party without the express
written consent of Mortgagee, which consent shall not be unreasonably withheld.
If at any time Mortgagee consents to the appointment of a new manager, such new
manager and Mortgagor shall, as a condition of Mortgagee's consent, execute a
Manager's Consent and Subordination of Management Agreement in the form then
used by Mortgagee.
19. Single Purpose Entity/Separateness. Mortgagor represents, warrants and
covenants as follows:
(a) The purpose for which the Mortgagor is organized shall be limited
solely to (A) owning, holding, selling, leasing, transferring, exchanging,
operating and managing the Mortgaged Property, (B) entering into the Loan with
the Mortgagee, (C) refinancing the Mortgaged Property in connection with a
permitted repayment of the Loan, and (D) transacting any and all lawful business
for which a Mortgagor may be organized under its constitutive law that is
incident, necessary and appropriate to accomplish the foregoing.
(b) Mortgagor does not own and will not own any asset or property other
than (i) the Mortgaged Property, and (ii) incidental personal property necessary
for and used in connection with the ownership or operation of the Mortgaged
Property.
(c) Mortgagor will not engage in any business other than the ownership,
management and operation of the Mortgaged Property.
(d) Mortgagor will not enter into any contract or agreement with any
affiliate of Mortgagor, any constituent party of Mortgagor, any owner of the
Mortgagor, the Guarantors (as hereinafter defined) or any affiliate of any
constituent party or Guarantor, except upon terms and conditions that are
intrinsically fair, commercially reasonable and substantially similar to those
that would be available on an arms-length basis with third parties not
affiliated with the Mortgagor or any constituent party of Mortgagor or any owner
of Mortgagor.
(e) Mortgagor has not incurred and will not incur any indebtedness, secured
or unsecured, other than the Loan and debt (i) incurred in the ordinary course
of business to vendors and suppliers of services to the Mortgaged Property, (ii)
not secured by the Mortgaged Property, or any portion thereof, or by interests
in the Mortgagor or any constituent entity thereof, and (iii) not accompanied by
any rights to control or to obtain control of the Mortgagor or any constituent
entity thereof. No indebtedness other than the Loan may be secured (subordinate
or pari passu) by the Mortgaged Property, or any portion thereof, or by
interests in the Mortgagor or any constituent entity thereof.
(f) Mortgagor has not made and will not make any loans or advances to any
entity or person (including any affiliate or any constituent party of Mortgagor
or any owner of Mortgagor, any Guarantor or any affiliate of any constituent
party or Guarantor), and shall not acquire obligations or securities of its
affiliates or any constituent party .
(g) Mortgagor is and will remain solvent and Mortgagor will pay its debts
and liabilities (including, as applicable, shared personnel and overhead
expenses) from its assets as the same shall become due.
(h) Mortgagor has done or caused to be done and will do all things
necessary to observe organizational formalities and preserve its existence, and
Mortgagor will not, nor will Mortgagor permit any constituent party of Mortgagor
or any owner of Mortgagor or any Guarantor to amend, modify or otherwise change
the partnership certificate, partnership agreement, articles of incorporation
and bylaws, operating agreement, trust or other organizational documents of
Mortgagor or such constituent party or Guarantor without the written consent of
Mortgagee.
(i) Mortgagor will maintain all of its books, records, financial statements
and bank accounts separate from those of its affiliates and any constituent
party. Subject to the immediately succeeding sentence, Mortgagor's assets will
not be listed as assets on the financial statement of any other entity.
Mortgagor shall have its own separate financial statement, provided, however,
that Mortgagor's assets may be included in a consolidated financial statement of
its parent companies if inclusion on such a consolidated statement is required
to comply with the requirements of generally accepted accounting principles
("GAAP"), provided that such consolidated financial statement shall contain a
footnote to the effect that Mortgagor's assets are owned by Mortgagor and that
they are being included on the financial statement of its parent solely to
comply with the requirements of GAAP, and further provided that such assets
shall be listed on Mortgagor's own separate balance sheet. Mortgagor will file
its own tax returns or may file a consolidated federal income tax return with
Dress Barn. Mortgagor shall maintain its books, records, resolutions and
agreements as official records.
(j) Mortgagor will be, and at all times will hold itself out to the public
as, a legal entity separate and distinct from any other entity (including any
affiliate of Mortgagor, any constituent party of Mortgagor, any Guarantor or any
affiliate of any constituent party or Guarantor), shall correct any known
misunderstanding regarding its status as a separate entity, shall conduct
business in its own name, shall not identify itself or any of its affiliates as
a division or part of the other and shall maintain and utilize separate
telephone numbers, stationery, invoices and checks.
(k) Mortgagor will maintain adequate capital for the normal obligations
reasonably foreseeable in a business of its size and character and in light of
its contemplated business operations.
(l) Neither Mortgagor nor any constituent party will seek the dissolution,
winding up, liquidation, consolidation or merger, in whole or in part, or the
sale of material assets of Mortgagor.
(m) Mortgagor will not commingle the funds and other assets of Mortgagor
with those of any affiliate or any constituent party of Mortgagor or any owner
of Mortgagor, any Guarantor, or any affiliate of any constituent party or
Guarantor, or any other person, and will not participate in a cash management
system with any such party.
(n) Mortgagor will not commingle its assets with those of any other person
or entity and will hold all of its assets in its own name.
(o) Mortgagor will not guarantee or become obligated for the debts of any
other entity or person and does not and will not hold itself out as being
responsible for the debts or obligations of any other person.
(p) Mortgagor shall be a Delaware limited liability company, having either:
(i) a minimum of two (2) members, one of which shall be a corporation whose sole
asset is its interest in Mortgagor (an "SPC Party"), and each such SPC Party
will at all times comply, and shall cause Mortgagor to comply, with each of the
representations, warranties and covenants contained in this Paragraph 19 as if
such representation, warranty or covenant was made directly by such SPC Party,
or (ii) one member ("Sole Member") that is not required to be an SPC Party, and
shall cause Mortgagor to comply with each of the representations, warranties and
covenants contained in this Paragraph 19, provided that: (aa) Mortgagor shall
have at least two (2) independent directors, each of which shall comply with all
of the requirements of an Independent Director as set forth in subsection (q)
below; (bb) upon the occurrence of any event that causes the Sole Member to
cease to be a member of Mortgagor, each person then acting as an independent
director of the Mortgagor shall automatically be admitted as a member of
Mortgagor as a special member (a "Special Member"); (cc) no Special Member shall
be permitted to resign from, or terminate its membership interest in, Mortgagor,
or transfer its rights as a Special Member unless a successor person has become
a member of Mortgagor as a Special Member; and (dd) the Special Members shall
automatically cease to be members of Mortgagor upon the admission to Mortgagor
of a substitute member or members in compliance with this subsection (p). The
certificate of formation, operating agreement and all other organization
documents of Mortgagor and all agreements affecting same, and all amendments,
supplements or restatements of the same, and the form and substances of the
same, shall be subject to the prior written approval of Mortgagee. In the event
of the occurrence of any of the changes set forth in this subsection, Mortgagor
shall furnish to Mortgagee, as a condition to any approval by Mortgagee, such
certificates, documents, consents and legal opinions as may be required by
Mortgagee or any rating agency.
(q) Mortgagor shall at all times cause there to be at least one duly
appointed member of the board of directors (an "Independent Director") of
Mortgagor, in the case of a corporation, and each SPC Party in Mortgagor, if any
is required under subsection (p) above, in the case of a limited partnership or
limited liability company, in each case reasonably satisfactory to Mortgagee who
is not at the time of initial appointment, and has not been at any time during
the preceding five (5) years: (a) stockholder, director, officer, employee,
partner, attorney or counsel of the SPC Party, the Mortgagor or any affiliate of
either of them; (b) a customer, supplier or other person who derives more than
ten percent (10%) of its purchases or revenues from its activities with the SPC
Party, the Mortgagor or any affiliate of either of them; (c) a person or other
entity controlling or under common control with any such stockholder, partner,
customer, supplier or other person; or (d) a member of the immediate family of
any such stockholder, director, officer, employee, partner, customer, supplier
or other person. As used herein, the term "control" means the possession,
directly or indirectly, of the power to direct or cause the direction of
management, policies or activities of a person or entity, whether through
ownership of voting securities, by contract or otherwise.
(r) Mortgagor shall not cause or permit the board of directors of each SPC
Party in Mortgagor, if any is required under subsection (p) above, to take any
action which, under the terms of any certificate of incorporation, by-laws or
any voting trust agreement with respect to any common stock, requires the vote
of such SPC Party in Mortgagor unless at the time of such action there shall be
at least one member who is an Independent Director.
(s) Mortgagor shall conduct its business so that the assumptions made with
respect to Mortgagor in that certain opinion letter of even date herewith (the
"Insolvency Opinion") delivered by Proskauer Rose, LLP in connection with the
Loan shall be true and correct in all respects.
(t) Mortgagor shall allocate fairly and reasonably any overhead expenses
that are shared with an affiliate, including paying for office space and
services performed by any employee of an affiliate.
(u) The stationery, invoices and checks utilized by Mortgagor or utilized
to collect its funds or pay its expenses shall bear its own name and shall not
bear the name of any other entity unless such entity is clearly designated as
being Mortgagor's agent.
(v) Mortgagor shall not pledge its assets for the benefit of any other
person or entity, and other than with respect to the Loan.
(w) Mortgagor shall correct any known misunderstanding regarding its
separate identity.
(x) Mortgagor shall not identify itself as a division of any other person
or entity.
20. Events of Default; Remedies. Each of the following events shall
constitute an "Event of Default" hereunder:
(a) if (i) any installment of interest or principal is not paid within five
(5) days after the same is due, (ii) the entire Indebtedness is not paid on or
before the Maturity Date (or if the Maturity Date has been accelerated, upon
such acceleration), or (iii) any other payment or charge due under the Note,
this Mortgage or any other Loan Documents is not paid when due (except if
payable to Mortgagee, is not paid within five (5) days after the same is due);
(b) if any Taxes payable directly to the billing authority by Mortgagor are
not paid before interest becomes payable on the amount due or a penalty is
assessed (provided that the foregoing provisions of this clause (b) shall be
subject to the right to contest Taxes granted to Mortgagor in Paragraph 4(b) of
this Mortgage, but only for so long as the conditions in Paragraph 4(b) of this
Mortgage remain satisfied);
(c) if the Policies are not kept in full force and effect and are not
delivered to Mortgagee when required hereunder, or if the Policies are not
delivered to Mortgagee within ten (10) days after request by Mortgagee;
(d) if any of the provisions of Paragraphs 7, 9, 19 or 39 herein are
violated or not complied with;
(e) if any of the events described in Paragraph 41 shall occur;
(f) if at any time any representation or warranty of Mortgagor or any
Guarantor made herein or in any guaranty, agreement, certificate, report,
affidavit, owner's affidavit, financial statement or other instrument furnished
to Mortgagee shall be false or misleading in any material respect;
(g) if any mortgagee under a mortgage on the Mortgaged Property, whether
superior or subordinate to this Mortgage (i) demands payment in full or
otherwise accelerates any indebtedness of Mortgagor or (ii) otherwise commences
the exercise of any remedy available to such party under any Loan Document;
(h) if Mortgagor fails to cure promptly any violation of any law or
ordinance affecting the Mortgaged Property (provided that the foregoing
provisions of this clause (h) shall be subject to any right to contest such
violation specifically granted to Mortgagor in Paragraph 8 of this Mortgage);
(i) if any Guaranty (as hereinafter defined) is terminated or any event or
condition occurs which, in the sole judgment of Mortgagee, may impair the
ability of any Guarantor to perform its obligations under any Guaranty or any
Guarantor attempts to withdraw, cancel or disclaim any Guaranty;
(j) if a default by Mortgagor under any of the other terms, covenants or
conditions of the Note, this Mortgage or any other Loan Document shall occur and
such default shall not have been cured within thirty (30) days after notice from
Mortgagee, provided that if such default is not susceptible of being cured
within such thirty (30) day period and Mortgagor shall have commenced the cure
of such default within such thirty (30) day period and thereafter diligently
pursues such cure to completion, then such thirty (30) day period shall be
extended for a period of ninety (90) days from the occurrence of the default,
provided, further, that the notice and grace period set forth in this
subparagraph (j) shall not apply to any other Event of Default expressly set
forth in this Paragraph 20 or to any other Event of Default defined as such in
any other Loan Document or to any other covenant or condition with respect to
which a grace period is expressly provided elsewhere; or
(k) if any of the provisions of Paragraphs 42(d) and/or Paragraph 42(f) are
violated or not complied with, and/or if any representation or warranty in
Paragraph 42(b) and/or 42(c) shall prove false or misleading in any respect
and/or if any of the events described in Paragraph 42(e) shall occur.
Upon the occurrence and during the continuance of any Event of Default, the
Indebtedness shall immediately become due at the option of Mortgagee.
Upon the occurrence and during the continuance of any Event of Default,
Mortgagor shall pay interest on the entire unpaid principal balance of the Note,
as defined in and provided for in the Note.
Upon the occurrence and during the continuance of any Event of Default,
Mortgagee may, to the extent permitted under applicable law, elect to treat the
fixtures owned by Mortgagor that are included in the Mortgaged Property either
as real property or as personal property, or both, and proceed to exercise such
rights as apply thereto. With respect to any sale of real property included in
the Mortgaged Property made under the powers of sale herein granted and
conferred, Mortgagee may, to the extent permitted by applicable law, include in
such sale any fixtures included in the Mortgaged Property and relating to such
real property.
21. Additional Remedies.
(a) Upon the occurrence and during the continuance of any Event of Default,
Mortgagee may take such action, without notice or demand, as it shall deem
advisable to protect and enforce its rights against Mortgagor and in and to the
Mortgaged Property or any part thereof or interest therein, 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 Mortgagee may determine, in its
sole discretion, without impairing or otherwise affecting the other rights and
remedies of Mortgagee (i) enter into or upon the Real Property, either
personally or by its agents, nominees or attorneys and dispossess Mortgagor and
its agents and servants therefrom, and thereupon Mortgagee may (A) use, operate,
manage, control, insure, maintain, repair, restore and otherwise deal with all
and every part of the Mortgaged Property and conduct the business thereat, (B)
complete any construction on the Mortgaged Property in such manner and form as
Mortgagee deems advisable, (C) make alterations, additions, renewals,
replacements and improvements to or on the Mortgaged Property, (D) exercise all
rights and powers of Mortgagor with respect to the Mortgaged Property, whether
in the name of Mortgagor 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 earnings, revenues, rents, issues, profits and
other income of the Mortgaged Property and every part thereof and (E) apply the
receipts from the Mortgaged Property to the payment of the Indebtedness, after
deducting therefrom all expenses (including reasonable attorneys' fees and
expenses) incurred in connection with the aforesaid operations and all amounts
necessary to pay the taxes, assessments, insurance and other charges in
connection with the Mortgaged Property, as well as just and reasonable
compensation for the services of Mortgagee and its counsel, agents and
employees, or (ii) institute proceedings for the complete foreclosure of this
Mortgage in which case the Mortgaged Property may be sold for cash or upon
credit in one or more parcels, or (iii) 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
Indebtedness then due and payable, subject to the continuing lien of this
Mortgage for the balance of the Indebtedness not then due, or (iv) sell for cash
or upon credit the Mortgaged Property or any part thereof and all or any part of
any estate, claim, demand, right, title and interest of Mortgagor therein and
rights of redemption thereof, pursuant to power of sale or otherwise, at one or
more sales, as an entity or in parcels, at such time and place, upon such terms
and after such notice thereof as may be required or permitted by law, and in the
event of a sale, by foreclosure or otherwise, of less than all of the Mortgaged
Property, this Mortgage shall continue as a lien on the remaining portion of or
estate in the Mortgaged Property, or (v) institute an action, suit or proceeding
in equity for the specific performance of any covenant, condition or agreement
contained herein or in the Note or any other Loan Document, or (vi) recover
judgment on the Note or any Guaranty either before, during or after any
proceedings for the enforcement of this Mortgage, or (vii) pursue such other
remedies as Mortgagee may have under applicable law.
(b) The purchase money proceeds or avails of any sale made under or by
virtue of this Paragraph 21, together with any other sums which then may be held
by Mortgagee under this Mortgage, whether under the provisions of this Paragraph
21 or otherwise, shall be applied as follows:
First: To the payment of the costs and expenses of any such sale, including
reasonable compensation to Mortgagee, its agents and counsel, and of any
judicial proceedings wherein the same may be made, and of all expenses,
liabilities and advances made or incurred by Mortgagee under this Mortgage,
together with interest as provided herein on all advances made by Mortgagee and
all taxes or assessments, except any taxes, assessments or other charges subject
to which the Mortgaged Property shall have been sold.
Second: To the payment of the whole amount then due, owing or unpaid upon
the Note for principal, together with any and all applicable interest, fees and
late charges.
Third: To the payment of any other sums required to be paid by Mortgagor
pursuant to any provision of this Mortgage or of the Note or of the Guaranty.
Fourth: To the payment of the surplus, if any, to whomsoever may be
lawfully entitled to receive the same.
Mortgagee and any receiver of the Mortgaged Property, or any part thereof,
shall be liable to account for only those rents, issues and profits actually
received by it.
(c) Mortgagee may adjourn from time to time any sale by Mortgagee to be
made under or by virtue of this Mortgage by announcement at the time and place
appointed for such sale or for such adjourned sale or sales; and, except as
otherwise provided by any applicable provision of law, Mortgagee, without
further notice or publication, may make such sale at the time and place to which
the same shall be so adjourned.
(d) Upon the completion of any sale or sales made by Mortgagee under or by
virtue of this Paragraph 21, Mortgagee, or an officer of any court empowered to
do so, shall execute and deliver to the accepted purchaser or purchasers a good
and sufficient instrument, or good and sufficient instruments, conveying,
assigning and transferring all estate, right, title and interest in and to the
property and rights sold. Mortgagee is hereby irrevocably appointed the true and
lawful attorney of Mortgagor, in its name and stead, to make all necessary
conveyances, assignments, transfers and deliveries of the Mortgaged Property and
rights so sold and for that purpose Mortgagee may execute all necessary
instruments of conveyance, assignment and transfer, and may substitute one or
more persons with like power, Mortgagor hereby ratifying and confirming all that
its said attorney or such substitute or substitutes shall lawfully do by virtue
hereof. Any such sale or sales made under or by virtue of this Paragraph 21,
whether made under the power of sale herein granted or under or by virtue of
judicial proceedings or of a judgment or decree of foreclosure and sale, shall
operate to divest all the estate, right, title, interest, claim and demand
whatsoever, whether at law or in equity, of Mortgagor in and to the properties
and rights so sold, and shall be a perpetual bar both at law and in equity
against Mortgagor and against any and all persons claiming or who may claim the
same, or any part thereof from, through or under Mortgagor.
(e) In the event of any sale made under or by virtue of this Paragraph 21
(whether made under the power of sale herein granted or under or by virtue of
judicial proceedings or of a judgment or decree of foreclosure and sale) the
entire Indebtedness, if not previously due and payable, immediately thereupon
shall, anything in the Note, this Mortgage, any Guaranty or any other Loan
Document to the contrary notwithstanding, become due and payable.
(f) Upon any sale made under or by virtue of this Paragraph 21 (whether
made under the power of sale herein granted or under or by virtue of judicial
proceedings or of a judgment or decree of foreclosure and sale), Mortgagee may
bid for and acquire the Mortgaged Property or any part thereof and in lieu of
paying cash therefor may make settlement for the purchase price by crediting
upon the Indebtedness the net sales price after deducting therefrom the expenses
of the sale and the costs of the action and any other sums which Mortgagee is
authorized to deduct under this Mortgage.
(g) No recovery of any judgment by Mortgagee and no levy of an execution
under any judgment upon the Mortgaged Property or upon any other property of
Mortgagor shall affect in any manner or to any extent, the lien of this Mortgage
upon the Mortgaged Property or any part thereof, or any liens, rights, powers or
remedies of Mortgagee hereunder, but such liens, rights, powers and remedies of
Mortgagee shall continue unimpaired as before.
22. Right to Cure Defaults. Upon the occurrence and during the continuance
of any Event of Default, Mortgagee may, but without any obligation to do so and
without notice to or demand on Mortgagor and without releasing Mortgagor from
any obligation hereunder, make or do the same in such manner and to such extent
as Mortgagee may deem necessary to protect the security hereof. Without limiting
the foregoing, Mortgagee may enter upon the Mortgaged Property for such purposes
or appear in, defend, or bring any action or proceeding to protect its interest
in the Mortgaged Property, and the cost and expense thereof (including, without
limitation, attorneys' fees and disbursements to the extent permitted by law),
with interest as provided in this Paragraph 22, shall be immediately due and
payable to Mortgagee upon demand by Mortgagee therefor. All such costs and
expenses incurred by Mortgagee in remedying such Event of Default or in
appearing in, defending, or bringing any such action or proceeding shall bear
interest at the Default Rate (as such term is defined in the Note), for the
period commencing on the date five (5) days after Mortgagor's receipt of
Mortgagee's written demand for payment for such cost or expense and ending on
the date of payment to Mortgagee. All such costs and expenses, together with
interest thereon at the Default Rate, shall be added to the Indebtedness and
shall be secured by this Mortgage. If the principal sum of the Note or any other
amount required to be paid on the Maturity Date under the Note shall not be paid
on the Maturity Date, interest shall thereafter be computed and paid at the
Default Rate.
23. Late Payment Charge. If any monthly principal and interest payment is
not paid in accordance with the Note, a late charge (the "Late Charge") shall be
due as provided for in the Note.
24. Prepayment. The Indebtedness may be prepaid only in accordance with the
terms of the Note.
25. Prepayment After Event of Default. A tender of the amount necessary to
satisfy the entire indebtedness, paid at any time during the continuance of an
Event of Default or following acceleration (which acceleration shall be at
Mortgagee's sole option), including at a foreclosure sale or during any
subsequent redemption period, if any, shall be deemed a voluntary prepayment,
which payment shall include a premium, the calculation of which shall be in
accordance with the terms of the Note and shall depend upon whether the Event of
Default or acceleration first occurred (i) prior to the time, if any, the
prepayment of the principal balance is not permitted pursuant to the terms of
the Note and prior to the date on which the full amount of the balance of
principal and interest then remaining unpaid shall be due or (ii) on or after
the date on which prepayment of the principal balance is permitted pursuant to
the terms of the Note.
26. Appointment of Receiver. Mortgagee, upon the occurrence and during the
continuance of an Event of Default or in any action to foreclose this Mortgage
or upon the actual or threatened waste to any part of the Mortgaged Property,
shall be entitled to the appointment of a receiver without notice and without
regard to the value or condition of the Mortgaged Property as security for the
Indebtedness or the solvency or insolvency of any person liable for the payment
of the Indebtedness.
27. Security Agreement.
(a) This Mortgage is both a real property Mortgage and a "security
agreement" within the meaning of the Uniform Commercial Code. The Mortgaged
Property includes both real and personal property and all other rights and
interests, whether tangible or intangible in nature, of Mortgagor in the
Mortgaged Property. Mortgagor, by executing and delivering this Mortgage grants
to Mortgagee, as security for the Indebtedness, a security interest in the
Mortgaged Property to the full extent that the Mortgaged Property may be subject
to the Uniform Commercial Code (such portion of the Mortgaged Property so
subject to the Uniform Commercial Code being called in this Paragraph 27 the
"Collateral"). Mortgagor hereby authorizes Mortgagee to file financing
statements in order to create, perfect, preserve and continue the security
interest(s) herein granted. This Mortgage shall also constitute a "fixture
filing" for the purposes of the Uniform Commercial Code and shall cover all
items of the Collateral that are or are to become fixtures. Information
concerning the security interest(s) herein granted may be obtained from
Mortgagee upon request.
If an Event of Default shall occur and be continuing, Mortgagee, 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
Mortgagee may deem necessary for the care, protection and preservation of the
Collateral. Upon request or demand of Mortgagee, Mortgagor shall at its expense
assemble the Collateral and make it available to Mortgagee at a convenient place
acceptable to Mortgagee. Mortgagor shall pay to Mortgagee on demand any and all
expenses, including legal expenses and attorneys' fees and disbursements,
incurred or paid by Mortgagee in protecting its interest in the Collateral and
in enforcing its rights hereunder with respect to the Collateral. Any notice of
sale, disposition or other intended action by Mortgagee with respect to the
Collateral sent to Mortgagor in accordance with the provisions hereof at least
five (5) days prior to such sale, disposition or action shall constitute
reasonable notice to Mortgagor. The proceeds of any disposition of the
Collateral, or any part thereof, may be applied by Mortgagee to the payment of
the Indebtedness in such priority and proportions as Mortgagee in its discretion
shall deem proper.
Mortgagor shall notify Mortgagee of any change in name, identity or
structure of Mortgagor and shall promptly execute, file and record, at its sole
cost and expense, such Uniform Commercial Code forms as are necessary to
maintain the priority of the lien of Mortgagee upon and security interest in the
Collateral. In addition, Mortgagor shall promptly execute, file and record such
additional Uniform Commercial Code forms or continuation statements as Mortgagee
shall deem necessary and shall pay all expenses and fees in connection with the
filing and recording thereof, provided that no such additional documents shall
increase the obligations of Mortgagor under the Note, this Mortgage or the other
Loan Documents. Mortgagor hereby grants to Mortgagee an irrevocable power of
attorney, coupled with an interest, to file with the appropriate public office
on its behalf any financing or other statements signed only by Mortgagee, as
secured party, in connection with the Collateral covered by this Mortgage.
(b) That portion of the Mortgaged Property consisting of personal property
and equipment, shall be owned by Mortgagor and shall not be the subject matter
of any lease or other transaction whereby the ownership or any beneficial
interest in any of such property is held by any person or entity other than
Mortgagor nor shall Mortgagor create or suffer to be created any security
interest covering any such property as it may from time to time be replaced,
other than the security interest created herein.
28. Authority.
(a) Mortgagor has full power, authority and legal right to execute this
Mortgage, and to mortgage, give, grant, bargain, sell, alien, enfeoff, convey,
confirm, pledge, hypothecate and assign and grant a security interest in the
Mortgaged Property pursuant to the terms hereof and to keep and observe all of
the terms of this Mortgage on Mortgagor's part to be performed.
(b) Mortgagor represents and warrants to Mortgagee that Mortgagor is not a
"foreign person" and covenants with Mortgagee that Mortgagor will not,
throughout the term of the Note, become a "foreign person" within the meaning of
Sect. 1445 and Sect. 7701 of the Internal Revenue Code of 1986, (26 USC Sect.
Sect. 1445, 7701) and the related Treasury Department regulations, including,
without limitation, temporary regulations (hereinafter collectively the "Code");
that is, such Mortgagor is not a non-resident alien, foreign corporation,
foreign partnership, foreign trust or foreign estate as those terms are defined
in the Code. (c) Mortgagor represents and warrants to Mortgagee that Mortgagor
is a limited liability company organized and existing under the laws of the
State of Delaware.
29. Actions and Proceedings. Mortgagee shall have the right to appear in
and defend any action or proceeding brought with respect to the Mortgaged
Property and to bring any action or proceeding, in the name and on behalf of
Mortgagor, which Mortgagee, in its discretion, shall decide should be brought to
protect its interest(s) in the Mortgaged Property.
30. Further Acts, Etc. Mortgagor will, at the sole cost of Mortgagor, and
without expense to Mortgagee, do, execute, acknowledge and deliver all and every
such further acts, deeds, conveyances, Mortgages, assignments, notices of
assignments, transfers and assurances as Mortgagee shall, from time to time,
reasonably require, for the better assuring, conveying, assigning, transferring
and confirming unto Mortgagee the property and rights hereby mortgaged, given,
granted, bargained, sold, aliened, enfeoffed, conveyed, confirmed, pledged,
assigned and hypothecated or intended now or hereafter so to be, or which
Mortgagor may be or may hereafter become bound to convey or assign to Mortgagee,
or for carrying out the intention or facilitating the performance of the terms
of this Mortgage or for filing, registering or recording this Mortgage and, on
demand, will execute and deliver within five (5) business days after request of
Mortgagee, and if Mortgagor fails to so deliver, hereby authorizes Mortgagee
thereafter to execute in the name of Mortgagor without the signature of
Mortgagor to the extent Mortgagee may lawfully do so, one or more financing
statements, to evidence more effectively the lien hereof upon the Mortgaged
Property.
31. Recording of Mortgage, Etc. Mortgagor forthwith upon the execution and
delivery of this Mortgage, will cause this Mortgage, and any security instrument
creating a lien or security interest or evidencing the lien hereof upon the
Mortgaged Property, to be filed, registered or recorded and, thereafter, from
time to time, each such other instrument of further assurance to be filed,
registered or recorded, all 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
the lien or security interest hereof upon, and the interest(s) of Mortgagee in,
the Mortgaged Property. Mortgagor will pay all filing, registration or recording
fees, and all expenses incident to the preparation, execution and acknowledgment
of this Mortgage, any Mortgage supplemental hereto, any security instrument with
respect to the Mortgaged Property and any instrument of further assurance, and
all federal, state, county and municipal, taxes, duties, imposts, assessments
and charges arising out of or in connection with the making, execution, delivery
and/or recording of this Mortgage, any Mortgage supplemental hereto, any
security instrument with respect to the Mortgaged Property or any instrument of
further assurance, except where prohibited by law so to do. Mortgagor shall hold
harmless and indemnify Mortgagee, its successors and assigns, against any
liability incurred by reason of the imposition of any tax on the making,
execution, delivery and/or recording of this Mortgage, any Mortgage supplemental
hereto, any security instrument with respect to the Mortgaged Property or any
instrument of further assurance.
32. Usury Laws. This Mortgage and the Note are subject to the express
condition that at no time shall Mortgagor be obligated or required to pay
interest on the principal balance due under the Note at a rate which could
subject the holder of the Note to either civil or criminal liability as a result
of being in excess of the maximum interest rate which Mortgagor is permitted by
law to contract or agree to pay. If by the terms of this Mortgage or the Note,
Mortgagor is at any time required or obligated to pay interest on the principal
balance due under the Note at a rate in excess of such maximum rate, the rate of
interest under the Note shall be deemed to be immediately reduced to such
maximum rate and the interest payable shall be computed at such maximum rate and
all prior interest payments in excess of such maximum rate shall be applied and
shall be deemed to have been payments in reduction of the principal balance of
the Note and the principal balance of the Note shall be reduced by such amount
in the inverse order of maturity.
33. Sole Discretion of Mortgagee. Wherever pursuant to this Mortgage,
Mortgagee exercises any right given to it to approve or disapprove, or any
arrangement or term is to be satisfactory to Mortgagee, the decision of
Mortgagee to approve or disapprove or to decide that arrangements or terms are
satisfactory or not satisfactory shall be in the sole discretion of Mortgagee
and shall be final and conclusive, except as may be otherwise specifically
provided herein.
34. Recovery of Sums Required To Be Paid. Mortgagee shall have the right
from time to time to take action to recover any sum or sums which constitute a
part of the Indebtedness as the same become due, without regard to whether or
not the balance of the Indebtedness shall be due, and without prejudice to the
right of Mortgagee thereafter to bring an action of foreclosure, or any other
action, for a default or defaults by Mortgagor existing at the time such earlier
action was commenced.
35. Marshalling and Other Matters. Mortgagor waives, to the extent
permitted by law, 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 Mortgaged Property or any
part thereof or any interest therein. Further, Mortgagor expressly waives any
and all rights of redemption from sale under any order or decree of foreclosure
of this Mortgage on behalf of Mortgagor, and on behalf of each and every person
acquiring any interest in or title to the Mortgaged Property subsequent to the
date of this Mortgage and on behalf of all persons to the extent permitted by
applicable law.
36. Waiver of Notice. Mortgagor shall not be entitled to any notices of any
nature whatsoever from Mortgagee except with respect to matters for which this
Mortgage specifically and expressly provides for the giving of notice by
Mortgagee to Mortgagor and except with respect to matters for which Mortgagee is
required by applicable law to give notice, and Mortgagor hereby expressly waives
the right to receive any notice from Mortgagee with respect to any matter for
which this Mortgage does not specifically and expressly provide for the giving
of notice by Mortgagee to Mortgagor.
37. Remedies of Mortgagor. In the event that a claim or adjudication is
made that Mortgagee has acted unreasonably or unreasonably delayed acting in any
case where by law or under the Note, this Mortgage or the other Loan Documents,
it has an obligation to act reasonably or promptly, Mortgagee shall not be
liable for any monetary damages, and Mortgagor's remedies shall be limited to
injunctive relief or declaratory judgment.
38. Reporting Requirements. At the request of Mortgagee, Mortgagor shall
supply or cause to be supplied to Mortgagee either (a) a copy of a completed
Form 0000-X, Xxxxxxxxx for Recipients of Proceeds from Real Estate, Broker and
Barter Exchange Proceeds prepared by Mortgagor's attorney or other person
responsible for the preparation of such form, together with a certificate from
the person who prepared such form to the effect that such form has, to the best
of such person's knowledge, been accurately prepared and that such person will
timely file such form or (b) a certification from Mortgagor that the Loan is a
refinancing of the Mortgaged Property or is otherwise not required to be
reported to the Internal Revenue Service pursuant to Section 6045(e) of the
Code. Mortgagor hereby indemnifies, defends and holds Mortgagee harmless from
and against all loss, cost, damage and expense (including without limitation,
attorneys' fees and disbursements and costs incurred in the investigation,
defense and settlement of claims) that Mortgagee may incur, directly or
indirectly, as a result of or in connection with the assertion against Mortgagee
of any claim relating to the failure of Mortgagee to comply with this Paragraph
38.
39. Hazardous Materials.
(a) Mortgagor represents and warrants that (i) to the best of Mortgagor's
knowledge, except as disclosed in that certain Phase I Environmental Report
dated ____ prepared by ________ as File Number _________ (the "Report") the
Mortgaged Property is now and at all times during Mortgagor's ownership thereof
has been free of contamination from any petroleum product and all hazardous or
toxic substances, wastes or substances, any substances which because of their
quantitative concentration, chemical, radioactive, flammable, explosive,
infectious or other characteristics, constitute or may reasonably be expected to
constitute or contribute to a danger or hazard to public health, safety or
welfare or to the environment, including, without limitation, any asbestos
(whether or not friable) and any asbestos-containing materials, waste oils,
solvents and chlorinated oils, polychlorinated biphenyls (PCBs), toxic metals,
etchants, pickling and plating wastes, explosives, reactive metals and
compounds, pesticides, herbicides, radon gas, urea formaldehyde foam insulation
and chemical, biological and radioactive wastes, or any other similar materials
or any hazardous or toxic wastes or substances which are included under or
regulated by any federal, state or local law, rule or regulation (whether now
existing or hereafter enacted or promulgated, as they may be amended from time
to time) pertaining to environmental regulations, contamination, clean-up or
disclosures, and any judicial or administrative interpretation thereof,
including any judicial or administrative orders or judgments ("Hazardous
Materials"), including, without limitation, the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, 42 U.S.C. section 9601 et seq.
("CERCLA"); The Federal Resource Conservation and Recovery Act, 42 U.S.C.
section 6901 et seq. ("RCRA"); Superfund Amendments and Reauthorization Act of
1986, Public Law No. 99-499 ("XXXX"); Toxic Substances Control Act, 15 U.S.C.
section 2601 et seq. ("TSCA"); the Hazardous Materials Transportation Act, 49
U.S.C. section 1801 et seq.; and any other state superlien or environmental
clean-up or disclosure statutes (all such laws, rules and regulations being
referred to collectively as "Environmental Laws"), (ii) Mortgagor has not caused
or, to the best of Mortgagor's knowledge after diligent inquiry, suffered to
occur any discharge, spill, uncontrolled loss or seepage of any Hazardous
Materials onto any property adjoining the Mortgaged Property and (iii) neither
the Mortgagor nor, to the best knowledge of Mortgagor after diligent inquiry,
any tenant or occupant of all or part of the Mortgaged Property is now or has
been involved in operations at the Mortgaged Property which could lead to
liability for Mortgagor or any other owner of the Mortgaged Property or the
imposition of a lien on the Mortgaged Property under any Environmental Law.
(b) At its sole cost and expense, Mortgagor shall comply with and shall
cause all tenants and other occupants of the Mortgaged Property to comply with
all Environmental Laws now in effect or hereafter enacted with respect to the
discharge, generation, removal, transportation, storage and handling of
Hazardous Materials. Mortgagor shall promptly notify Mortgagee if Mortgagor
shall become aware of any Hazardous Materials on or near the Mortgaged Property
and/or if Mortgagor shall become aware that the Mortgaged Property is in direct
or indirect violation of any Environmental Laws and/or if Mortgagor shall become
aware of any condition on or near the Mortgaged Property which shall pose a
threat to the health, safety or welfare of humans. Mortgagor shall promptly
remove all Hazardous Materials from the Mortgaged Property, such removal to be
performed in accordance with all applicable federal, state and local laws,
statutes, rules and regulations. Mortgagor shall pay immediately when due the
cost of removal of any Hazardous Materials and shall keep the Mortgaged Property
free of any lien imposed pursuant to any Environmental Laws now in effect or
hereinafter enacted. Notwithstanding the above, in the event Mortgagor is
obligated, pursuant to applicable law or regulation, to remediate any Hazardous
Materials at the Mortgaged Property, Mortgagor's failure to complete such
remediation shall not constitute an Event of Default pursuant to Section 20 (j)
below even though such remediation shall not be completed within ninety (90)
days after the notice given by Mortgagee under said subsection (j), provided
that Mortgagor has complied with said subsection (j) and such remediation cannot
practically be completed within such ninety (90) days and Mortgagor shall
diligently and continuously pursue such remediation to completion in accordance
with this Mortgage.
(c) Mortgagor grants Mortgagee and its employees and agents an irrevocable
and non-exclusive license, subject to the rights of tenants, to enter the
Mortgaged Property to conduct testing and to remove any Hazardous Materials, and
the costs of such testing and removal shall immediately become due to Mortgagee
and shall be secured by this Mortgage. Mortgagor, promptly upon the request of
Mortgagee, from time to time, shall provide Mortgagee with an environmental site
assessment or environmental audit report, or an update of such an assessment or
report, all in scope, form and content satisfactory to Mortgagee. Mortgagor
shall maintain the integrity of all storage tanks and drums on or under the
Mortgaged Property during the term of the Loan in compliance with all
Environmental Laws now in effect or hereinafter enacted. Mortgagor shall, at the
request of Mortgagee, follow an operation and maintenance program with respect
to all storage tanks and drums on or under the Mortgaged Property pursuant to a
program which has been approved in writing by Mortgagee. Notwithstanding the
foregoing, Mortgagor shall not be responsible for preparation of an
environmental site assessment or environmental audit report, or an update of
such an assessment or report, or the cost of any testing requested or conducted
by Mortgagee, unless Mortgagee has a reasonable basis for its belief that
Hazardous Materials may be present at the Mortgaged Property.
(d) Mortgagor shall indemnify Mortgagee and hold Mortgagee harmless from
and against all liability, loss, cost, damage and expense (including, without
limitation, attorneys' fees and costs incurred in the investigation, defense and
settlement of claims) that Mortgagee may incur as a result of or in connection
with the assertion against Mortgagee (whether as past or present holder of this
Mortgage, as mortgagee in possession or as past or present owner of the
Mortgaged Property by virtue of a foreclosure or acceptance of a deed in lieu of
foreclosure) of any claim relating to the presence and/or release, threatened
release, storage, disposal, generating or removal of any Hazardous Materials or
compliance with any Environmental Laws now in effect or hereinafter enacted. The
obligations and liabilities of Mortgagor under this Paragraph 39 shall survive
full payment of the Loan, entry of a judgment of foreclosure or acceptance of a
deed in lieu of foreclosure or any subsequent transfer to a third party. It is
understood that the presence and/or release of substances referred to in this
section hereof does not pertain to a presence and/or release which first occurs
solely after (A) repayment of the Loan in full in accordance with the Loan
Documents or (B) acquisition of title to the Property by Mortgagee upon a
foreclosure or acceptance of a deed in lieu of foreclosure and surrender of
possession and occupancy of the Property by Mortgagor, its agents, affiliates,
employees and independent contractors. Mortgagor shall have the burden of
proving that the conditions in subsection (d) were satisfied by clear and
convincing evidence and shall continue to defend with counsel satisfactory to
Mortgagee and shall indemnify and hold Mortgagee harmless for all matters set
forth in this Paragraph 39, unless and until a court of competent jurisdiction
finds that Mortgagor has met such burden.
(e) Nothing contained herein shall constitute or be construed as a waiver
of any statutory or judicial federal, state or local law which may provide
rights or remedies to Mortgagee against Mortgagor or others in connection with
any claim relating to the Mortgaged Property and pertaining to the presence
and/or release, threatened release, storage, disposal, generating or removal of
any Hazardous Materials or to the failure to comply with any Environmental Laws
now or hereafter enacted.
40. Asbestos. As long as the Loan is outstanding, Mortgagor shall not
install or permit to be installed in the Mortgaged Property, friable asbestos or
any substance containing asbestos. With respect to any such material currently
present in the Mortgaged Property, Mortgagor, at Mortgagor's expense, shall
promptly comply with and shall cause all occupants of the Mortgaged Property to
comply with all present and future applicable federal, state or local laws,
rules, regulations or orders relating to asbestos, friable asbestos and asbestos
containing materials. In the event any asbestos, friable asbestos or asbestos
containing material is discovered at the Mortgaged Property, Mortgagor shall
obtain a comprehensive asbestos report prepared by a licensed engineer or
asbestos consultant acceptable to Mortgagee describing the form, extent,
location and condition of such asbestos and recommending methods of removal or
abatement. Mortgagor shall promptly comply at its sole cost and expense with the
recommendations contained in such report, such compliance to be performed in
accordance with all applicable federal, state and local laws, statutes, rules
and regulations. Mortgagor shall indemnify Mortgagee and hold Mortgagee harmless
from and against all loss, cost, damage and expense (including, without
limitation, attorneys' fees and costs incurred in the investigation, defense and
settlement of claims) that Mortgagee may incur as a result of or in connection
with the assertion against Mortgagee (whether as past or present holder of the
Mortgage, as mortgagee in possession, or as past or present owner of the
Mortgaged Property by virtue of a foreclosure or acceptance of a deed in lieu of
foreclosure) of any claim relating to the presence or removal of any asbestos
substance referred to in this Paragraph 40, or compliance with any federal,
state or local laws, rules, regulations or orders relating thereto. The
obligations and liabilities of Mortgagor under this Paragraph 40 shall survive
full payment of the Loan, a foreclosure or the acceptance of a deed in lieu of
foreclosure.
41. Bankruptcy or Insolvency. In the event that Mortgagor or any Guarantor
or, if Mortgagor or any Guarantor is a general or limited partnership, any
general partner of any such entity (a) admits in writing its inability to pay
its debts generally as they become due, or does not pay its debts generally as
they become due, (b) commences as debtor any case or proceeding under any
bankruptcy, insolvency, reorganization, liquidation, dissolution or similar law,
or seeks or consents to the appointment of a receiver, conservator, trustee,
custodian, manager, liquidator or similar official for it or the whole or any
substantial part of its property, (c) has a receiver, conservator, trustee,
custodian, manager, liquidator, or similar official appointed for it or the
whole or any substantial part of its property, by any governmental authority
with jurisdiction to do so, (d) makes a proposal or any assignment for the
benefit of its creditors, or enters into an arrangement or composition or
similar plan or scheme with or for the benefit of creditors generally occurring
in circumstances in which such entity is unable to meet its obligations as they
become due or (e) has filed against it any case or proceeding under any
bankruptcy, insolvency, reorganization, liquidation, dissolution or similar law
which (i) is consented to or not timely contested by such entity, (ii) results
in the entry of an order for relief, appointment of a receiver, conservator,
trustee, custodian, manager, liquidator or similar official for such entity or
the whole or any substantial part of its property or (iii) is not dismissed
within ninety (90) days, an Event of Default shall have occurred and as a
result, the entire principal balance of the Note and all obligations under any
Guaranty shall become immediately due and payable at the option of Mortgagee
without notice to Mortgagor or any Guarantor and Mortgagee may exercise any
remedies available to it hereunder, under any other Loan Document, at law or in
equity.
42. Compliance with ERISA and State Statutes on Governmental Plans.
(a) Mortgagee represents and warrants to Mortgagor that, as of the date of
this Mortgage and throughout the term of this Mortgage, the source of funds from
which Mortgagee extends this Mortgage is its general account, which is subject
to the claims of its general creditors under state law.
(b) Mortgagor represents and warrants that, as of the date of this Mortgage
and throughout the term of this Mortgage, (i) Mortgagor is not an "employee
benefit plan" as defined in Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), which is subject to Title I of ERISA
and (ii) the assets of such Mortgagor do not constitute "plan assets" of one or
more such plans within the meaning of 29 C.F.R. Sect. 2510.3-101.
(c) Mortgagor represents and warrants to Mortgagee that, as of the date of
this Mortgage and throughout the term of this Mortgage (i) Mortgagor is not a
"governmental plan" within the meaning of Section 3(32) of ERISA and (ii)
transactions by or with Mortgagor or any Mortgagor are not subject to state
statues regulating investments of and fiduciary obligations with respect to
governmental plans.
(d) Mortgagor covenants and agrees to deliver to Mortgagee such
certifications or other evidence from time to time throughout the term of this
Mortgage, as requested by Mortgagee in its sole discretion, that (i) Mortgagor
is not an "employee benefit plan" or a "governmental plan", (ii) Mortgagor is
not subject to state statutes regulating investments and fiduciary obligations
with respect to governmental plans, and (iii) one or more of the following
circumstances is true:
(A) Equity interests in Mortgagor are publicly offered securities, within the
meaning of 29 C.F.R. Sect. 2510.3-101(b)(2);
(B) Less than 25 percent of all equity interests in such Mortgagor are held by
"benefit plan investors" within the meaning of 29 C.F.R. Sect.
2510.3-101(f)(2); or
(C) Mortgagor qualifies as an "operating company" or a "real estate operating
company" within the meaning of 29 C.F.R. Sect. 2510.3.-101(c) or (e).
(e) Any of the following shall constitute an Event of Default under this
Mortgage, entitling Mortgagee to exercise any and all remedies to which it
may be entitled under this Mortgage, and any other Loan Documents
(i) the failure of any representation or warranty made by any Mortgagor
under this Paragraph 42 to be true and correct in all respects, (ii) the failure
of any Mortgagor to provide Mortgagee with the written certifications and
evidence referred to in this Paragraph 42 or (iii) the consummation by Mortgagor
or any one Mortgagor of a transaction which would cause this Mortgage or any
exercise of Mortgagee's rights under this Mortgage, or the other Loan Documents
to constitute a non-exempt prohibited transaction under ERISA or a violation of
a state statute regulating governmental plans, or otherwise subjecting Mortgagee
to liability for violation of ERISA or such state statute.
(f) Mortgagor shall indemnify Mortgagee and defend and hold Mortgagee
harmless from and against all civil penalties, excise taxes, or other loss,
cost, damage and expense (including, without limitation, attorneys' fees and
disbursements and costs incurred in the investigation, defense and settlement of
claims and losses incurred in correcting any prohibited transaction or in the
sale of a prohibited loan, and in obtaining any individual prohibited
transaction exemption under ERISA that may be required, in Mortgagee's sole
discretion) that Mortgagee may incur, directly or indirectly, as a result of a
default under this Paragraph 42. This indemnity shall survive any termination,
satisfaction or foreclosure of this Mortgage.
43. Assignments. Mortgagee shall have the right to assign or transfer its
rights under this Mortgage without limitation, with written notice to Mortgagor.
Any assignee or transferee shall be entitled to all the benefits afforded
Mortgagee under this Mortgage.
44. Cooperation. Mortgagor acknowledges that Mortgagee and its successors
and assigns may (a) sell this Mortgage, the Note and other Loan Documents to one
or more investors as a whole loan, (b) participate the Loan to one or more
investors, (c) deposit this Mortgage, the Note and other Loan Documents with a
trust, which trust may sell certificates to investors evidencing an ownership
interest in the trust assets or (d) otherwise sell the Loan or interest therein
to investors (the transactions referred to in clauses (a) through (d) are
hereinafter referred to as "Secondary Market Transactions"). Mortgagor shall, at
its expense not to exceed $5,000 paid to third parties, reasonably cooperate in
good faith with Mortgagee (aa) in effecting any such Secondary Market
Transaction and (bb) to implement all requirements imposed by the Rating Agency
involved in any Secondary Market Transaction including, without limitation, all
structural or other changes to the Loan, modifications to any documents
evidencing or securing the Loan, delivery of opinions of counsel acceptable to
the Rating Agency and addressing such matters as the Rating Agency may require;
provided, however, that Mortgagor shall not be required to modify any documents
evidencing or securing the Loan which would modify (i) the interest rate payable
under the Note, (ii) the stated maturity of the Note, (iii) the amortization of
principal of the Note or (iv) any other material economic term of the Loan.
Mortgagor shall provide such information and documents in its possession
relating to Mortgagor, Guarantor, if any, the Mortgaged Property, the Lease and
the Lessee as Mortgagee may reasonably request in connection with a Secondary
Market Transaction. Mortgagee shall have the right to provide to prospective
investors any information in its possession, including, without limitation,
financial statements relating to Mortgagor, the Guarantor, if any, the Mortgaged
Property and the Lessee. Mortgagor acknowledges that certain information
regarding the Loan and the parties thereto and the Mortgaged Property may be
included in a private placement memorandum, prospectus or other disclosure
documents.
45. Indemnification for Non-Recourse Carveout Obligations. Mortgagor hereby
covenants and agrees unconditionally and absolutely to indemnify and save
harmless Mortgagee, its officers, directors, shareholders, employees, agents and
attorneys against all damages, losses, liabilities, obligation, claims,
litigation, demands or defenses, judgments, suits, proceedings, fines,
penalties, costs, disbursements and expenses of any kind or nature whatsoever
(including without limitation attorneys' fees reasonably incurred), which may at
any time be imposed upon, incurred by or asserted or awarded against Mortgagee
and arising from the Non-Recourse Carveout Obligations.
This indemnity shall survive any foreclosure of this Mortgage, the taking
of a deed in lieu thereof, or any other discharge of the obligations of the
Mortgagor hereunder or a transfer of the Mortgaged Property, even if the
indebtedness secured hereby is satisfied in full. Mortgagor agrees that the
indemnification granted herein may be enforced by Mortgagee without resorting to
or exhausting any other security or collateral or without first having recourse
to the Note or the Mortgaged Property covered by this Mortgage through
foreclosure proceedings or otherwise; provided, however, that, subject to
Paragraph 46 of this Mortgage, nothing herein contained shall prevent Mortgagee
from suing on the Note or foreclosing this Mortgage or from exercising any other
rights under the Loan Documents.
46. Exculpation. Notwithstanding anything to the contrary contained herein,
but subject to Paragraph 45 hereof, any claim based on or in respect of any
liability of Mortgagor under the Note or under this Mortgage or any other Loan
Document shall be enforced only against the Mortgaged Property and any other
collateral now or hereafter given to secure the Loan and not against any other
assets, properties or funds of Mortgagor; provided, however, that the liability
of Mortgagor for loss, costs or damage arising out of the matters described
below (collectively, "Non-Recourse Carveout Obligations") shall not be limited
solely to the Mortgaged Property and other collateral now or hereafter given to
secure the Loan but shall include all of the assets, properties and funds of
Mortgagor: (i) fraud, misrepresentation and waste, (ii) any rents, issues or
profits, other than security deposits received from tenants in the ordinary
course of business, collected more than one (1) month in advance of their due
dates, (iii) any misappropriation of rents, issues or profits, security deposits
and any other payments from tenants or occupants (including, without limitation,
lease termination fees) insurance proceeds, condemnation awards, or other sums
of a similar nature, (iv) liability under environmental covenants, conditions
and indemnities contained in the Mortgage and in any separate environmental
indemnity agreements, (v) personalty or fixtures owned by Mortgagor removed or
allowed to be removed by or on behalf of Mortgagor and not replaced by items of
equal or greater value or functionality than the personalty or fixtures so
removed, (vi) failure to pay taxes or assessments prior to delinquency, or to
pay charges for labor, materials or other charges which can create liens on any
portion of the Mortgaged Property and any sums expended by Mortgagee in the
performance of or compliance with the obligations of Mortgagor under the Loan
Documents, including, without limitation, sums expended to pay taxes or
assessments or hazard insurance premiums or bills for utilities or other
services or products for the benefit of the Mortgaged Property, (vii) the
unauthorized sale, conveyance or transfer of title to the Mortgaged Property or
encumbrance of the Mortgaged Property, (viii) the failure of Mortgagor to
maintain its status as a single purpose, bankruptcy-remote entity pursuant to
its organizational documents and the Loan Documents, and (ix) attorney's fees,
court costs and other expenses incurred by Mortgagee in connection with
enforcement of Mortgagor's personal liability as set forth herein. Nothing
herein shall be deemed (w) to be a waiver of any right which Mortgagee may have
under any bankruptcy law of the United States or the state where the Mortgaged
Property is located including, but not limited to, Section 506(a), 506(b),
1111(b) or any other provisions of the U.S. Bankruptcy Code, to file a claim for
the full amount of the indebtedness secured by this Mortgage or to require that
all of the collateral securing the indebtedness secured hereby shall continue to
secure all of the indebtedness owing to Mortgagee under the Note, this Mortgage
and the other Loan Documents; (x) to impair the validity of the indebtedness
secured by this Mortgage; (y) to impair the right of Mortgagee as Mortgagee or
secured party to commence an action to foreclose any lien or security interest;
or (z) to modify, diminish or discharge the liability of any Guarantor under any
Guaranty.
47. Notices. Any notice, demand, statement, request or consent made
hereunder shall be effective and valid only if in writing, referring to this
Mortgage, signed by the party giving such notice, and delivered either
personally to such other party, or sent by nationally recognized overnight
courier delivery service or by certified mail of the United States Postal
Service, postage prepaid, return receipt requested, addressed to the other party
as follows (or to such other address or person as either party or person
entitled to notice may by notice to the other party specify):
To Mortgagee:
Xxxx Xxxxxxx Life Insurance Company
Real Estate Investment Group
Xxxx Xxxxxxx Tower, T-56
000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Re: Loan No. 6518045
with a copy concurrently to:
Xxxxxxx & Xxxxxx, LLP
00 Xxxxx Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxx X. X'Xxxxxxxx
To Mortgagor:
Xxxxxxxx Realty LLC
00 Xxxxxxxx Xxxxx
Xxxxxxx, Xxx Xxxx 00000
Attention: General Counsel
with a copy concurrently to:
Proskauer Rose LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Unless otherwise specified, notices shall be deemed given as follows: (i)
if delivered personally, when delivered, (ii) if delivered by nationally
recognized overnight courier delivery service, on the day following the day such
material is sent, or (iii) if delivered by certified mail, on the third day
after the same is deposited with the United States Postal Service as provided
above.
48. Non-Waiver. The failure of Mortgagee to insist upon strict performance
of any term hereof shall not be deemed to be a waiver of any term of this
Mortgage. Mortgagor shall not be relieved of Mortgagor's obligations hereunder
by reason of (a) failure of Mortgagee to comply with any request of Mortgagor or
any Guarantor to take any action to foreclose this Mortgage or otherwise enforce
any of the provisions hereof or of the Note, any Guaranty or the other Loan
Documents, (b) the release, regardless of consideration, of the whole or any
part of the Mortgaged Property, or of any person liable for the Indebtedness or
portion thereof or (c) any agreement or stipulation by Mortgagee extending the
time of payment or otherwise modifying or supplementing the terms of the Note,
any Guaranty, this Mortgage or the other Loan Documents. Mortgagee may resort
for the payment of the Indebtedness to any other security held by Mortgagee in
such order and manner as Mortgagee, in its discretion, may elect. Mortgagee may
take action to recover the Indebtedness, or any portion thereof, or to enforce
any covenant hereof without prejudice to the right of Mortgagee thereafter to
foreclose this Mortgage. The rights of Mortgagee under this Mortgage shall be
separate, distinct and cumulative and none shall be given effect to the
exclusion of the others. No act of Mortgagee shall be construed as an election
to proceed under any one provision herein to the exclusion of any other
provision. Mortgagee 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 by law.
49. Joint and Several Liability. If there is more than one party comprising
Mortgagor, then the obligations and liabilities of each party under this
Mortgage shall be joint and several.
50. Severability. If any term, covenant or condition of the Note, any
Guaranty or this Mortgage is held to be invalid, illegal or unenforceable in any
respect, the Note, any Guaranty and this Mortgage shall be construed without
such provision.
51. Duplicate Originals. This Mortgage may be executed in any number of
duplicate originals and each such duplicate original shall be deemed to
constitute but one and the same instrument.
52. Indemnity and Mortgagee's Costs. Mortgagor agrees to pay all costs,
including, without limitation, attorneys' fees and expenses, incurred by
Mortgagee in enforcing the terms hereof and/or the terms of any of the other
Loan Documents or the Note or any Guaranty, whether or not suit is filed and
waives to the full extent permitted by law all right to plead any statute of
limitations as a defense to any action hereunder. Mortgagor agrees to indemnify
and hold Mortgagee harmless from any and all liability, loss, damage or expense
(including, without limitation, attorneys' fees and disbursements) that
Mortgagee may or might incur hereunder or in connection with the enforcement of
any of its rights or remedies hereunder, any action taken by Mortgagee
hereunder, or by reason or in defense of any and all claims and demands
whatsoever that may be asserted against Mortgagee arising out of the Mortgaged
Property; and should Mortgagee incur any such liability, loss, damage or
expense, the amount thereof with interest thereon at the Default Rate shall be
payable by Mortgagor immediately without demand, shall be secured by this
Mortgage, and shall be a part of the Indebtedness.
53. Certain Definitions. Unless the context clearly indicates a contrary
intent or unless otherwise specifically provided herein, words used in this
Mortgage shall be used interchangeably in singular or plural form. The word
"Mortgagor" shall mean Mortgagor and/or any subsequent owner or owners of the
Mortgaged Property or any part thereof or interest therein. The word "Mortgagee"
shall mean Mortgagee or any subsequent holder of the Note. The word "Guaranty"
shall mean any Guaranty of Payment, Guaranty of Completion, Guaranty of
Collection, Environmental Indemnity or any other Guaranty or Indemnity given at
any time to or for the benefit of Mortgagee in connection with the Loan. The
word "Guarantor" shall mean any person giving or making any Guaranty. The word
"Note" shall mean the Note or any other evidence of indebtedness secured by this
Mortgage. The words "Loan Documents" shall mean the Note, this Mortgage, the
loan agreement, if any, between Mortgagor and Mortgagee, the security agreement,
if any, between Mortgagor and Mortgagee, the assignment of leases and rents, if
any, made by Mortgagor to Mortgagee, any reserve agreements between Mortgagor
and Mortgagee, any escrow agreements between Mortgagor and Mortgagee, the
assignment of contracts, if any, made by Mortgagor to Mortgagee, all Guaranties,
if any, made to Mortgagee, any other Mortgage or deed of trust securing the Note
and any other agreement, instrument, affidavit or document executed by
Mortgagor, any Guarantor or any indemnitor and delivered to Mortgagee in
connection with the Loan. The word "person" shall include an individual,
corporation, partnership, trust, unincorporated association, government,
governmental authority or other entity. The words "Mortgaged Property" shall
include any portion of the Mortgaged Property or interest therein. 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.
54. 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 Mortgagor or any one Mortgagor or
Mortgagee, 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.
55. No Foreign Person. Mortgagor is not a "foreign person" within the
meaning of Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended
and the related Treasury Department Regulations, including temporary
regulations.
56. Separate Tax Lot. The Mortgaged Property is assessed for real estate
tax purposes as one or more wholly independent tax lot or lots, separate from
any adjoining land or improvements not constituting a part of such lot or lots,
and no other land or improvements is assessed and taxed together with the
Mortgaged Property or any portion thereof.
57. Right to Release Any Portion of the Mortgaged Property. Mortgagee may
release any portion of the Mortgaged Property for such consideration as
Mortgagee may require without, as to the remainder of the Mortgaged 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 Mortgagee for such
release, and may accept by assignment, pledge or otherwise any other property in
place thereof as Mortgagee 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 Mortgaged Property.
58. Subrogation. The Mortgagee shall be subrogated for further security to
the lien, although released of record, of any and all encumbrances paid out of
the proceeds of the Loan secured by this Mortgage.
59. Administrative Fees. Mortgagee may charge administrative fees and be
reimbursed for all costs and expenses, including reasonable attorneys' fees and
disbursements, associated with reviewing and processing post-closing requests of
Mortgagor.
60. Disclosure. Mortgagor represents and warrants that (a) it has fully
disclosed to Mortgagee all facts actually known to Mortgagor after exercising
due diligence which are material to the Mortgaged Property and the operation and
tenants thereof, the Mortgagor, the Mortgagor's business operations, any
guarantor of Non-Recourse Carveout Obligations, any indemnitor of environmental
liabilities, and any other Guarantor and any principal of any of them and the
background, creditworthiness, financial condition and business operations of
each, (b) all material information submitted in connection with this Loan is
true, correct and complete, (c) the financial and operating statements and other
accounting information submitted in connection with the Loan are true, correct,
complete, and fairly present the financial condition of the Mortgagor,
Guarantors and Indemnitors and their respective principals and have been
prepared consistent with proper accounting standards, and (d) there is no
litigation, action, claim, or other proceeding, pending or threatened which
might, in any way, materially and/or adversely affect the Applicant, Mortgagor,
any Guarantor, any Indemnitor or the principals of any of them, or the Mortgaged
Property, Mortgagee's lien thereon, or the financial condition of the Mortgaged
Property or any of the aforementioned persons; and a misrepresentation or breach
of any representation, warranty or covenant shall be an Event of Default under
the Loan Documents.
61. Headings, Etc.. The headings and captions of various paragraphs 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.
62. Address of Real Property. The street address of the Real Property is as
follows: 00 Xxxxxx Xxxx, Xxxxxx, Xxx Xxxx 00000 (a/k/a Xxxxxxxx Xxxxx, Xxxxxxx,
Xxx Xxxx 00000
63. Method of Payment. At Mortgagor's option upon written notice to
Mortgagee, all payments of principal and interest and other amounts due under
this Mortgage shall be paid to Mortgagee by Automated Clearing House debit
against Mortgagor's account. Mortgagor agrees to pay Mortgagee's administrative
expenses in changing such payment method and to provide Mortgagee all necessary
authorizations.
64. Publicity. Mortgagor agrees that Mortgagee, at its expense, may
publicize the financing of the Mortgaged Property in trade and similar
publications after the date hereof.
65. Relationship. The relationship of Mortgagee to Mortgagor under this
Mortgage is strictly and solely that of lender and borrower and nothing
contained in this Mortgage or any other Loan Document is intended to create, or
shall in any event or under any circumstance be construed to create, a
partnership, joint venture, tenancy-in-common, joint tenancy or other
relationship of any nature whatsoever between Mortgagee and Mortgagor other than
that of lender and borrower.
66. Homestead. Mortgagor hereby waives and renounces all homestead and
exemption rights provided by the constitution and the laws of the United States
and of any state, in and to the Land as against the collection of the
Indebtedness, or any part hereof.
67. No Third Party Beneficiaries. Nothing contained herein is intended or
shall be deemed to create or confer any rights upon any third person not a party
hereto, whether as a third-party beneficiary or otherwise, except as expressly
provided herein.
68. Compliance with Regulation U. Mortgagor represents, warrants and
covenants that no part of the proceeds of the Loan will be used for the purpose
(whether immediate, incidental or ultimate) of buying or carrying any margin
stock within the meaning of Regulation U (12 CFR part 221) of the Board of
Governors of the Federal Reserve System of the United States or for the purpose
of reducing or retiring any indebtedness which was originally incurred for any
such purpose, or for any other purpose which might constitute this Loan a
"purpose credit" within the meaning of such Regulation U.
69. Entire Agreement. This Mortgage, the Note and the other Loan Documents
constitute the entire agreement among Mortgagor and Mortgagee with respect to
the subject matter hereof and all understandings, oral representations and
agreements heretofore or simultaneously had among the parties are merged in, and
are contained in, such documents and instruments.
70. Servicer. Mortgagee may from time to time appoint a servicer (the
"Servicer") to administer the Loan, which Servicer shall have the power and
authority to exercise all of the rights and remedies of Mortgagee and to act as
agent of Mortgagee hereunder.
71. Governing Law; Consent to Jurisdiction. This Mortgage shall be governed
by and construed in accordance with the law of the state in which the Mortgaged
Property is located without regard to conflict of law provisions thereof. Each
Mortgagor, endorser AND guarantor hereby submits to personal jurisdiction in
said state and the federal courts of the United States of America located in
said state (and any appellate courts taking appeals therefrom) for the
enforcement of such Mortgagor'S, ENDORSER'S OR GUARANTOR'S obligations
hereunder, under the Note, the Guaranty and the other Loan Documents, and waives
any and all personal rights under the law of any other state to object to
jurisdiction within such state for the purposes of SUCH ACTION, SUIT, PROCEEDING
OR litigation to enforce such obligations of such Mortgagor, ENDORSER or
GUARANTOR. EACH Mortgagor, ENDORSER AND GUARANTOR hereby waives and agrees not
to assert, as a defense in any action, suit or proceeding arising out of or
relating to this Mortgage, THE NOTE, ANY GUARANTY or any OTHER LOAN Document,
(a) that it is not subject to such jurisdiction or that such action, suit or
proceeding may not be brought or is not maintainable in those courts or that
this Mortgage, THE NOTE, THE GUARANTY AND/OR ANY OF THE OTHER LOAN DOCUMENTS may
not be enforced in or by those courts or that it is exempt or immune from
execution, (b) that the action, suit or proceeding is brought in an inconvenient
forum or (c) that the venue of the action, suit or proceeding is improper. In
the event any SUCH action, suit, proceeding or litigation is commenced,
Mortgagor, ENDORSER AND GUARANTOR agree that service of process may be made, and
personal jurisdiction over such Mortgagor, ENDORSER OR GUARANTOR obtained, by
service of a copy of the summons, complaint and other pleadings required to
commence such litigation upon such Mortgagor, ENDORSER or GUARANTOR at 00
XXXXXXXX XXXXX, XXXXXXX, XXX XXXX 00000.
72. Partial Release. Mortgagor may request that Mortgagee release from the
lien of this Mortgage and the other Loan Documents (the "Partial Release") a
16.16 acre parcel which constitutes a portion of the Mortgaged Property (the
"Release Parcel"). Mortgagee will release the Release Parcel provided that all
of the following conditions (the "Partial Release Conditions") are satisfied:
(a) No Event of Default under the Loan Documents shall have occurred or remain
uncured;
(b) The Partial Release does not occur until after the third anniversary of the
date the first installment of principal and interest is due under the Note;
(c) Mortgagor shall pay to Mortgagee, as a reduction to the then current
principal amount, an amount equal to $__________ ("Loan Pay Down Amount"),
and such prepayment shall be treated in the same manner as any other
prepayment except as otherwise provided in this Paragraph;
(d) Mortgagor shall pay to Mortgagee an amount equal to one percent (1%) of the
Loan Pay Down Amount. Notwithstanding anything in subparagraph (c) above or
in the Note, the Loan Pay Down Amount may be paid at any time permitted
under subsection (b) above and the payment required under this subsection
(d) shall be in lieu of any other prepayment premium required under the
Note.
(e) The Release Parcel shall have been legally and validly subdivided from the
Mortgaged Property, and both the Release Parcel and the remaining portion
of the Mortgaged Property (the "Remaining Security") are independently in
compliance with all applicable federal, state and local laws and
regulations, including, without limitation, all laws and regulations
pertaining to environmental land use, zoning, minimum lot size, parking
requirements, setback, frontage, site plan approval, and Map Act
requirements (if applicable);
(f) Mortgagor provides Mortgagee with the following which shall be acceptable
in form and substance to Mortgagee: (1) reasonable evidence that the
release of the Release Parcel will not interfere with railroad access, or
vehicular or pedestrian access to a public way, utilities, truck turning
and access, parking or other items affecting the Remaining Security, (2)
any easements for access, utilities or other items necessary to permit the
Release Parcel and the Remaining Security to operate independently without
impairing or unduly burdening the Remaining Security, and (3) any joint
use, reciprocal covenant and/or operations agreement necessary to permit
the Release Parcel and the Remaining Security to operate independently
without impairing or unduly burdening the Remaining Security. The agreement
to permit the Partial Release does not constitute an agreement by Mortgagee
to consent to or to subordinate the Loan Documents to any easements or use
agreements;
(g) The Release Parcel and the Remaining Security shall each constitute
separate tax and zoning lots, and Mortgagor shall deliver to Mortgagee
evidence that each parcel composing the Release Parcel and the Remaining
Security constitutes a lawful parcel and has been separately assessed for
real property tax purposes;
(h) Mortgagor delivers to Mortgagee an endorsement to the title insurance
policy covering the Mortgaged Property (the "Title Policy") (1) updating
the Title Policy to the date of the recording of the documents evidencing
the Partial Release, (2) reflecting the new legal description of the
Remaining Security, (3) certifying and insuring that the Loan Documents
remain and constitute an enforceable first lien on the Remaining Security,
subject to no other exceptions to title except the title exceptions
contained in the title policy issued to Mortgagee at the closing of the
Loan, and (4) insuring that the Remaining Security continues to be in
compliance with all state and local zoning, Map Act (if applicable),
subdivision and parking laws and regulations;
(i) The release of the Release Parcel will not violate the terms of, or entitle
any tenant to reduce the rent payable under or terminate, any Lease on the
Remaining Security;
(j) Mortgagor delivers notice to, and obtains consent of, any party requiring
notice or consent to the Partial Release;
(k) Mortgagor shall execute in favor of Mortgagee such amendments of the Loan
Documents as are necessary to effect the Partial Release and to preserve
(1) the first priority status of the lien of Mortgagee on the Remaining
Security, and (2) Mortgagee's other rights and remedies;
(l) Mortgagor shall pay all reasonable legal, administrative, title, recording
and any other costs and expenses incurred in connection with the Partial
Release (including, without limitation, any such costs and expenses
incurred by Mortgagee) and furthermore shall pay to Mortgagee an
administrative fee equal to $2,500 for any Partial Release;
(m) If the Loan is part of a Secondary Market Transaction and if requested by
Mortgagee, Mortgagor delivers to Mortgagee a Non-Disqualification Opinion.
A "Non-Disqualification Opinion" means a written opinion of counsel
reasonably approved by Mortgagee substantially to the effect that the
contemplated Partial Release (a) would not constitute a "significant
modification" of the Loan within the meaning of Treas. Reg. Sect. 1.1001-3;
(b) would not cause the Loan to fail to be a "qualified mortgage" within
the meaning of Section 860G(a)(3)(A) of the Internal Revenue Code; (c) will
not cause the entity holding the Loan Documents to fail to qualify as a
real estate mortgage investment conduit ("REMIC") and (d) will not cause a
"prohibited transaction," or "prohibited contribution" under the Internal
Revenue Code or any other tax to be imposed on any REMIC or such entity;
and
(n) If the Loan is part of a Secondary Market Transaction and if requested by
Mortgagee, Mortgagor delivers to Mortgage a Rating Agency Confirmation. The
term "Rating Agency Confirmation") shall mean that Mortgagor shall have
received in writing evidence from the rating agencies which then or in the
past rated the transaction to the effect that the Partial Release will not
result in a re-qualification, reduction or withdrawal of any rating
initially assigned or to be assigned in a Secondary Market Transaction
together with such legal opinions as may be requested by such rating
agencies.
73. Special State Provisions .
(a) Inconsistencies. In the event of any inconsistencies between the terms
and conditions of the foregoing Paragraphs and this Paragraph, the terms of this
Paragraph shall control and be binding.
(b) Power of Sale. Upon the occurrence of an Event of Default, Mortgagee
may sell, assign, transfer and deliver the whole or, from time to time, any part
of the Mortgaged Property, or any interest in any part thereof, at any private
sale or at public auction, with or without demand, advertisement or notice, for
cash, on credit or for other property, for immediate or future delivery, and for
such price or prices and on such terms as Mortgagee in its uncontrolled
discretion may determine, or as may be required by law, including, without
limitation, the procedures set forth in Article 14 of the New York Real Property
Actions and Proceedings Law (and any amendments or substitute statutes in regard
thereto).
(c) Use and Occupancy Fee. Upon the occurrence and during the continuance
of any Event of Default and pending the exercise by Mortgagee of its right to
exclude Mortgagor from all or any part of the Mortgaged Property, Mortgagor
agrees to pay the fair and reasonable rental value for the use and occupancy of
the Mortgaged Property or any portion thereof which are in its possession for
such period and, upon default of any such payment, will vacate and surrender
possession of the Mortgaged Property or to a receiver, if any, and in default
thereof may be evicted by any summary action or proceeding for the recovery or
possession of premises for non-payment of rent, however designated.
(d) Payment of Mortgagee's Expenses. In any suit to foreclose the lien
hereof (including any partial foreclosure) or to enforce any other remedy of
Mortgagee under this Mortgage or the Note, there shall be allowed and included
as additional indebtedness in the decree for sale or other judgment or decree,
all expenditures and expenses which may be paid or incurred by or on behalf of
Mortgagee for attorneys' fees, appraiser's fees, outlays for documentary and
expert evidence, stenographer's charges, publication costs, and costs which may
be estimated as to items to be expended after entry of the decree) of procuring
all such abstracts of title, title searches and examinations, title insurance
policies, Torrens certificates, and similar data and assurances with respect to
title and value as Mortgagee may deem necessary either to prosecute such suit or
to evidence to bidders at any sale which may be had pursuant to such decree the
true condition of the title or the value of the Mortgaged Property.
(e) Lien Law. Pursuant to Section 13 of the Lien Law of New York, Mortgagor
will receive the advances secured by this Mortgage and will hold the right to
receive such advances as a trust fund to be applied first for the purpose of
paying the costs of completing any improvement and will apply the same first to
the payment of such costs before using any part of the total of the same for any
other purpose. Mortgagor will indemnify and hold Mortgagee harmless against any
loss or liability, cost or expense, including, without limitation, any
judgments, attorneys' fees, costs of appeal bonds and printing costs, arising
out of or relating to any proceeding instituted by any claimant alleging a
violation by Mortgagor of any applicable lien law.
(f) Real Property Law. All covenants and conditions contained in this
Mortgage, other than those included in the New York Statutory Short Form of
Mortgage, shall be construed as affording to the Mortgagee rights additional to,
and not exclusive of, the rights conferred under the provisions of section 254
of the Real Property Law of the state of New York.
(g) Section 291-f Agreement. In accordance with Section 291-f of the New
York Real Property Law, Mortgagor shall neither cancel any of the Leases now or
hereafter in effect nor terminate (except in accordance with this Mortgage) or
accept a surrender thereof nor reduce the payment of the rent thereunder or
otherwise amend, modify or supplement any of the provisions thereof which in any
way affects the rights of Mortgagee (except as permitted hereunder) or grant any
consent or waiver thereunder or accept any prepayment of rent thereunder for
more than one month in advance (except for security deposits in the ordinary
course of Mortgagor's business) without first obtaining, on each such occasion,
the written approval of Mortgagee in accordance herewith; provided, that, in the
event Mortgagor terminates, amends, modifies, and /or supplements any such Lease
(or grants any consent or waiver thereunder) in accordance herewith, Mortgagor
shall promptly provide Mortgagee with written notice of, and complete
documentation relating to, such termination, modification, amendment,
supplement, consent or waiver, together with such other information Mortgagee
may reasonably request; provided, further, that any cancellation abridgement,
modification or prepayment made not in accordance herewith or with the written
consent of Mortgagee shall be voidable by the holder of the Note and this
Mortgage, as such holder may elect. This Mortgage is intended to be, and shall
operate as, the agreement described in Section 291-f of the Real Property Law of
the State of New York and shall be entitled to the benefits afforded thereby.
Mortgagor shall deliver notice of this Mortgage in form and substance acceptable
to Lender (unless such notice is contained in such tenant's Lease), to all
present and future holders of any interest in any Lease having an unexpired term
of five years or more, by assignment or otherwise and shall take such other
action as may now or hereafter be reasonably required to afford Mortgagee the
full protections and benefits of said Section 291-f.
(h) Assignment of Mortgage. Upon any prepayment or payment to Mortgagee of
the Indebtedness as provided for herein and in the Note (including, without
limitation, all fees, costs, and expenses incurred by or on behalf of Mortgagee
hereunder or under any other Loan Document which Mortgagor is required to pay
hereunder or under any other Loan Document or for which Mortgagee is entitled to
be reimbursed hereunder or thereunder) and the performance by Mortgagor of all
of the obligations imposed on Mortgagor in the Loan Documents, Mortgagee shall
assign without recourse all of its right, title and interest in and to this
Mortgage to a lender designated by Mortgagor ("Designated Lender"), as long as
all of the following conditions are satisfied:
(i) Designated Lender or Mortgagor requests such assignment in writing at least
twenty (20) days prior to the prepayment or payment in full of the Loan,
which request shall include (A) such request to assign; (B) the legal name
and address of the Designated Lender; and (C) a form of assignment
reasonably satisfactory to Mortgagee;
(ii) Without limiting the foregoing, such assignment shall be without recourse
to Mortgagee and shall expressly disclaim any warranties and
representations from Mortgagee, except the Mortgagee shall represent that
it has not assigned the Mortgage;
(iii)Designated Lender is an institutional lender, a commercial bank, an
insurance company, a pension fund or a conduit lender, or any other bona
fide mortgage lender, which may include an institution not ordinarily in
the business of holding mortgage loans, provided that the acquisition and
holding of the loan by such individual or entity is a bona fide transaction
which complies with all applicable laws, regulations and codes;
(iv) The delivery of such assignment occurs concurrently with the prepayment or
payment in full of the Loan;
(v) Such assignment can be accomplished without violating the provisions of
applicable law or administrative regulations;
(vi) Mortgagee shall deliver to Designated Lender upon full payment therefore
original documents in its possession or if lost, affidavit of lost notes or
other documents, without recourse to Mortgagee, except for a Mortgagee's
customary indemnity; and
(vii)Mortgagor shall pay Mortgagee's reasonable legal fees incurred in
connection with any such assignment.
(i) Non-Residential Dwelling. This Mortgage does not cover real property
principally improved or to be improved by one or more structures containing in
the aggregate not more than six (6) residential dwelling units, each having
their own separate cooking facilities.
(j) Indefinite Mortgage Savings Clause. Notwithstanding anything contained
herein to the contrary, the maximum amount of principal indebtedness secured by
this Mortgage at the time of execution hereof or which under any contingency may
become secured by this Mortgage at any time hereafter is $34,000,000, plus (i)
Taxes and Other Charges and other taxes, charges or assessments which may be
imposed by law upon the Mortgaged Property; (ii) premiums on insurance policies
covering the Mortgaged Property; and (iii) expenses incurred in upholding the
lien of this Mortgage, or to protect or make safe the Mortgaged Property,
including, but not limited to (A) the expenses of any litigation to prosecute or
defend the rights and lien created by this Mortgage; (B) any amounts, costs or
charges to which the Mortgagee becomes subrogated, upon payment, whether under
recognized principles of law or equity, or under express statutory authority,
and (C) interest on the Indebtedness at the interest set forth in the Note or
the Default Rate (as the case may be) and any premium due under or in respect of
the Note and all other sums and fees payable according to the Note or otherwise
in connection with the Loan.
(k) Statement Required by Section 274-a of New York Real Property Law.
Mortgagee shall, within 20 days after request, provide Mortgagor with the
statement required by Section 274-a of New York Real Property Law.
[Remainder of page intentionally left blank; signature page to follow.]
[Signature and Acknowledgement Page to Mortgage, Assignment of
Leases and Rents and Security Agreement]
IN WITNESS WHEREOF, Mortgagor has duly executed and delivered
this Mortgage as of the day and year first above written.
MORTGAGOR:
XXXXXXXX REALTY LLC
By:
Xxxxx X. Xxxxx
President
STATE OF NEW YORK )
) ss.
COUNTY OF ROCKLAND )
On this _____ day of June, 2003, before me, the undersigned, a Notary
Public in and for said state, personally appeared Xxxxx X. Xxxxx, personally
known to me or proved to me on basis of satisfactory evidence to be the person
whose name is subscribed to the within instrument and acknowledged to me that he
executed the same in his capacity and that by his signature on the instrument,
the person or the entity upon behalf of which the person acted executed the
instrument.
Name:
Notary Public
My commission expires:
Exhibit A-1
EXHIBIT A
DESCRIPTION OF LAND