INDENTURE OF MORTGAGE AND SECURITY AGREEMENT
TRUMP TAJ MAHAL ASSOCIATES
Mortgagor
and
FIRST BANK NATIONAL ASSOCIATION,
AS COLLATERAL AGENT
Mortgagee
Dated as of April 17, 1996
----------------------------------------------------
Record and return to:
Skadden, Arps, Slate, Meagher & Flom
919 Third Avenue
New York, New York 10022
Attention: Wallace L. Schwartz, Esq.
TABLE OF CONTENTS
Page
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ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF
GENERAL APPLICATION
Section 1.01. Definitions............................................... 10
Section 1.02. Notices................................................... 18
Section 1.03. Form and Contents of Documents
Delivered to Mortgagee................................ 19
Section 1.04. Compliance Certificates and Opinions...................... 19
Section 1.05. Effect of Headings and Table of
Contents.............................................. 20
Section 1.06. Successors and Assigns; Amendments........................ 20
Section 1.07. Separability Clause....................................... 20
Section 1.08. Benefits of Mortgage...................................... 20
Section 1.09. Governing Law............................................. 20
Section 1.10. Limitation on Liability................................... 20
Section 1.11. Provisions Required by Trust
Indenture............................................. 21
Section 1.12. Rights of Mortgagee....................................... 21
Section 1.13. Mortgage Subject to Casino Control
Act................................................... 22
Section 1.14. Discharge of Lien......................................... 22
Section 1.15. General Application....................................... 23
Section 1.16. Mortgage Deemed to be Security
Agreement............................................. 23
ARTICLE TWO
RELEASE; SUBORDINATION
Section 2.01. Possession by Mortgagor................................... 24
Section 2.02. Obsolete Property......................................... 24
Section 2.03. F,F&E Financing Agreements................................ 25
Section 2.04. [Intentionally Omitted]................................... 25
ARTICLE THREE
REMEDIES
Section 3.01. Events of Default......................................... 25
Section 3.02. Application of Moneys Received by
Mortgagee.............................................. 25
Section 3.03. Restoration of Rights and Remedies........................ 26
Section 3.04. Rights and Remedies Cumulative............................ 26
Section 3.05. Delay or Omission Not Waiver.............................. 26
Section 3.06. Undertaking for Costs..................................... 26
Section 3.07. Waiver of Appraisement and Other Laws..................... 27
Section 3.08. Entry..................................................... 27
Section 3.09. Power of Sale; Suits for Enforcement...................... 28
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Section 3.10. Incidents of Sale......................................... 28
Section 3.11. Receiver.................................................. 30
Section 3.12. Suits to Protect the Trust Estate......................... 30
Section 3.13. Management of the Premises................................ 30
ARTICLE FOUR
CONSOLIDATION, MERGER, CONVEYANCE,
TRANSFER OR LEASE
Section 4.01. Consolidation, Merger, Conveyance or
Transfer only on Certain Terms........................ 31
ARTICLE FIVE
COVENANTS AND REPRESENTATIONS OF MORTGAGOR
Section 5.01. Performance of Obligations................................ 31
Section 5.02. F,F&E Financing Agreements................................ 31
Section 5.03. Limitations on Liens and Transfers........................ 31
Section 5.04. Environmental............................................. 32
Section 5.05. Pari Passu Liens.......................................... 37
Section 5.06. Warranty of Leasehold Estate and Title.................... 37
Section 5.07. After-Acquired Property; Further Assurances; Recording.... 38
Section 5.08. Payment of Taxes and Certain Claims;
Maintenance of Properties;
Compliance with Legal Require-
ments and Insurance Requirements....................... 41
Section 5.09. Permitted Contests........................................ 43
Section 5.10. Mechanics' and Other Liens................................ 44
Section 5.11. To Insure................................................. 44
Section 5.12. Limitations on Building Demolition,
Alterations, Improvements and New
Construction........................................... 47
Section 5.13. Leases.................................................... 49
Section 5.14. Compliance Certificates................................... 51
Section 5.15. [Intentionally Omitted]................................... 51
Section 5.16. To Keep Books; Inspection by
Mortgagee.............................................. 51
Section 5.17. Advances by Mortgagee..................................... 51
Section 5.18. Waiver of Stay, Extension or Usury
Laws................................................... 52
Section 5.19. [Intentionally Omitted]................................... 52
Section 5.20. Facility Leases........................................... 52
Section 5.21. [Intentionally Omitted]................................... 58
Section 5.22. Indemnification........................................... 58
Section 5.23. Acceptance................................................ 59
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SCHEDULES AND EXHIBITS
Schedule 1 - Owned Land
Schedule 2 - Ground Leases and Ground Lease Land
Schedule 3 - Parking Leases and Parking Lease Land
Schedule 4 - Intentionally Omitted
Schedule 5 - Form of Non-Disturbance and Attornment
Agreement
Exhibit A - Form of Trust Indenture
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INDENTURE OF MORTGAGE AND SECURITY AGREEMENT
INDENTURE OF MORTGAGE AND SECURITY AGREEMENT ("Mortgage"), dated as of
April 17, 1996, between TRUMP TAJ MAHAL ASSOCIATES, a New Jersey partnership
("Mortgagor"), having an office at Mississippi Avenue and The Boardwalk,
Atlantic City, New Jersey 08401, and FIRST BANK NATIONAL ASSOCIATION, a national
banking association having an office at 180 East Fifth Street, St. Paul,
Minnesota 55101, as Collateral Agent ("Mortgagee"), on behalf of the Designated
Representatives (as hereinafter defined) for the benefit of the Secured
Beneficiaries (as hereinafter defined) under the Collateral Agency Agreement (as
hereinafter defined).
W I T N E S S E T H:
In consideration of $10.00 in hand paid by Mortgagee to Mortgagor and for
other good and valuable consideration, the receipt and sufficiency whereof is
hereby acknowledged, and in order to secure (i) the punctual payment and
performance when due of all of Guarantors' obligations under the Guarantee; (ii)
the punctual payment and performance when due of all of the Company's, the
Issuers', the Guarantors' and the Mortgagor's obligations under the Mortgage
Notes, the Trust Indenture, the Secured Loans, the Debt Documents and, to the
extent not otherwise included, any other Obligations in the initial principal
sum of $1,200,000,000 but which principal sum may be increased up to
$1,300,000,000 pursuant to the terms of the Trust Indenture and the Collateral
Agency Agreement; (iii) payment by Mortgagor to Mortgagee of all sums expended
or advanced by Mortgagee pursuant to any term or provision of this Mortgage;
(iv) performance of each covenant, term, condition and agreement of Mortgagor
herein contained; (v) all costs and expenses, including, without limitation,
reasonable counsel fees and expenses as provided in Section 3.07, which may
arise in respect of this Mortgage or of the obligations secured hereby; and (vi)
performance and observance of all of the provisions herein contained, Mortgagor
has executed and delivered this Mortgage and has bargained, sold, alienated,
mortgaged, pledged, released, conveyed and confirmed unto Mortgagee and its
successors hereunder and assigns forever, all of its right, title and interest
in, to and under all of the following described property:
GRANTING CLAUSES
Granting Clause First
All of the property, rights, title, interest, privileges and franchises
particularly described in annexed Schedule 1 (the "Owned Land") which Schedule
is hereby made a part of, and deemed to be described in, this Granting Clause as
fully as if set forth in this Granting Clause at length.
Granting Clause Second
All of the property, rights, title, interest, privileges and franchises of
Mortgagor as lessee under (a) all Facility Leases and (b) all Parking Leases,
together with (i) all credits, deposits, privileges and rights of Mortgagor as
lessee under the Facility Leases and the Parking Leases, now or at any time
existing, (ii) the leaseholds and the leasehold estates created by the Facility
Leases and the Parking Leases and (iii) all of the estates, rights, titles,
claims or demands whatsoever of Mortgagor, either in law or in equity, in
possession or in expectancy, of, in and to the Facility Leases, the Leased
Facilities, the Parking Leases and the Parking Lease Land, together with (x) any
and all other, further or additional title, estates, interests or rights which
may at any time be acquired by Mortgagor in or to the Leased Facilities or the
Parking Lease Land or any part thereof, and Mortgagor expressly agrees that if
Mortgagor shall, at any time prior to payment in full of all indebtedness
secured hereby, acquire fee simple title or any other greater estate to the
Leased Facilities (including, without limitation, to the Ground Lease Land
pursuant to the terms of the Ground Leases) or the Parking Lease Land, the Lien
of this Mortgage shall attach, extend to, cover and be a Lien upon such fee
simple title or other greater estate and (y) any right to possession or
statutory term of years derived from, or incident to, the Facility Leases or the
Parking Leases pursuant to Section 365(h) of the Code or any Comparable
Provision.
Except as otherwise set forth herein and in the other Mortgage Documents,
the assignment made by this Granting Clause Second shall not impair or diminish
any right, privilege or obligation of Mortgagor with respect to the Facility
Leases or the Parking Leases, nor shall any such obligation be imposed on
Mortgagee.
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Granting Clause Third
All of the rents, issues, profits, revenues accounts, accounts receivable
and other income and proceeds (including, without limitation, all rents, fees,
charges, accounts, issues, profits, revenues and payments for or from (a) the
use or occupancy of the rooms and other public facilities in the Hotel and (b)
the operation of the Casino) of the property subjected or required to be
subjected to the Lien of this Mortgage, including, without limitation, the
property described in Granting Clauses First, Second and Sixth (said property
described in Granting Clauses First, Second and Sixth and similar other property
subjected or required to be subjected to the Lien of this Mortgage, together
with all such rents, issues, profits, revenues, accounts, accounts receivable
and other income and proceeds therefrom is hereinafter collectively referred to
as the "Premises") and all of the estate, right, title and interest of every
nature whatsoever of Mortgagor in and to the same and every part thereof.
Granting Clause Fourth
All of the rights of Mortgagor as lessor under the Leases in effect on the
date of execution of this Mortgage or hereafter entered into by Mortgagor,
including modifications, extensions and renewals of all of the same, and the
immediate and continuing right as security in accordance with the Assignment of
Leases and Rents, and, after the occurrence, and during the continuance, of an
Event of Default, to (a) make claim for, collect, receive and receipt for (and
to apply the same as provided herein) any and all rents, fees, charges, income,
revenues, issues, profits, security and other sums of money payable or
receivable thereunder or pursuant thereto, and all proceeds thereof, whether
payable as rent, insurance proceeds, condemnation awards, security or otherwise
and whether payable prior to or subsequent to the Stated Maturity of any of the
Debt Documents, (b) receive and give notices and consents thereunder, (c) bring
actions and proceedings thereunder or for the enforcement thereof, (d) make
waivers and agreements thereunder or with respect thereto, (e) take such action
upon the happening of a default under any Lease, including the commencement,
conduct and consummation of any proceedings at law or in equity as shall be
permitted by any provision of any Lease, and (f) do any and all things which
Mortgagor or any lessor is or may become entitled to do under the Leases;
provided, that, except as may be set forth to the contrary in the Assignment of
Leases and Rents, the assignment made by this Granting Clause Fourth shall not
impair or diminish any right, privilege or
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obligation of Mortgagor under the Leases nor shall any such obligation be
imposed upon Mortgagee.
Granting Clause Fifth
Without limiting the generality of the provisions of Granting Clause Third,
all of Mortgagor's rights, title, interest, privileges and franchises in and to
the following, now owned or hereafter acquired by Mortgagor, to the extent of
Mortgagor's interest therein and thereto and to the extent assignable
(collectively, "Operating Assets"):
(a) bookings for the use of guest rooms, banquet facilities, meeting
rooms at the Casino Hotel or at any other improvements now or hereafter
located on any of the Land;
(b) all contracts respecting utility services for, and the
maintenance, operations, or equipping of, the Premises, including
guaranties and warranties relating thereto;
(c) the Permits;
(d) all contract rights, leases (whether with respect to real
property, personal property or both real and personal property, excluding
the Facility Leases and the Parking Leases), concessions, trademarks, trade
names, service marks, logos, copyrights, warranties and other items of
intangible personal property, and any and all good will associated with the
same relating to the ownership or operation of the Casino Hotel or of any
other improvements now or hereafter located on any of the Land, including,
without limitation, (1) telephone and other communication numbers, (2) all
software licensing agreements as are required to operate computer software
systems at the Casino Hotel or at any other improvements now or hereafter
located on any of the Land and books and records relating to the software
programs and (3) lessee's interest under leases of Tangible Personal
Property;
(e) all contracts, purchase orders, requisitions and agreements
entered into by or on behalf of Mortgagor or which have been assigned to
Mortgagor, for the design, construction, and furnishing of the Casino Hotel
or of any other improvements now or hereafter located on any of the Land,
including, without limitation, architect's agreements, engineering
agreements, construction contracts, consulting agreements and agreements or
purchase orders for all items of Tangible Personal
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Property and payment and performance bonds in favor of Mortgagor in
connection with the Trust Estate (and all warranties and guarantees
thereunder and warranties and guarantees of any subcontractor and bond
issued in connection with the work to be performed by any subcontractor);
(f) the following personal property (the "Tangible Personal Property")
now or hereafter acquired by Mortgagor (directly or by way of lease) which
are located on, or to be located on, or which are in use or held in reserve
storage for future use in connection with the gaming or other operations
of, the Casino Hotel or of any other improvements now or hereafter located
on any of the Land, which are on hand or on order whether stored on-site or
off-site:
(i) all furniture, furnishings, equipment, machinery, apparatus,
appliances, fixtures and fittings and other articles of tangible
personal property;
(ii) all slot machines, electronic gaming devices, crap tables,
blackjack tables, roulette tables, baccarat tables, big six wheels and
other gaming tables, and all furnishings and equipment to be used in
connection with the operation thereof;
(iii) all cards, dice, gaming chips and placques, tokens, chip
racks, dealing shoes, dice cups, dice sticks, layouts, paddles,
roulette balls and other consumable supplies and items;
(iv) all china, glassware, linens, kitchen utensils, silverware
and uniforms;
(v) all consumables and operating supplies of every kind and
nature, including, without limitation, accounting supplies, guest
supplies, forms, printing, stationery, food and beverage stock, bar
supplies, laundry supplies and brochures to existing purchase orders;
(vi) all upholstery material, carpets and rugs, beds, bureaus,
chiffonniers, chairs, chests, desks, bookcases, tables, curtains,
hangings, pictures, divans, couches, ornaments, bars, bar fixtures,
safes, stoves, ranges, refrigerators, radios, televisions, clocks,
electrical equipment, lamps, mirrors, heating and lighting fixtures
and equipment, ice machines, air conditioning machines, fire
prevention and extinguishing apparatus, laundry machines, and all
similar and related articles used
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in bedrooms, sitting rooms, bathrooms, boudoirs, halls, closets,
kitchens, dining rooms, offices, lobbies, basements and cellars in the
Casino Hotel and in any other improvements now or hereafter located on
any of the Land;
(vii) all sets and scenery, costumes, props and other items of
tangible personal property on hand or on order for use in the
production of shows in any showroom, convention space, exhibition
hall, or sports and entertainment arena of the Casino Hotel or in any
other improvements now or hereafter located on any of the Land; and
(viii) all cars, limousines, vans, buses, trucks and other
vehicles owned or leased by Mortgagor for use in connection with the
operation of the Premises, together with all equipment, parts and
supplies used to service, repair, maintain and equip the foregoing;
(g) all drawings, designs, plans and specifications prepared by
architects, engineers, interior designers, landscape designers and any
other professionals or consultants for the design, development,
construction and/or improvement of the Casino Hotel, or for any other
development of the Premises, as amended from time to time;
(h) any administrative and judicial proceedings initiated by
Mortgagor, or in which Mortgagor has intervened, concerning the Premises,
and agreements, if any, which are the subject matter of such proceedings;
(i) any customer lists utilized by Mortgagor including lists of
transient guests and restaurant and bar patrons and "high roller" lists;
and
(j) all of the good will in connection with the assets listed in this
Granting Clause Fifth and in connection with the operation of the Premises.
Except as otherwise set forth herein and in the other Mortgage Documents,
the assignment made by this Granting Clause Fifth shall not impair or diminish
any right, privilege or obligation of Mortgagor with respect to the Operating
Assets, nor shall any such obligation be imposed on Mortgagee.
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Granting Clause Sixth
(a) All of Mortgagor's rights, title, interest, privileges and franchises
in and to all buildings, structures (surface and subsurface), and other
improvements of every kind and description, including, without limitation, all
pedestrian bridges, entrance-ways, parking lots, plazas, curb-cuts, walkways,
driveways and landscaping and such fixtures as constitute real property, now or
hereafter erected or placed on the Land or on any other land or any interest
therein hereafter acquired by Mortgagor and all of Mortgagor's rights, title,
interest, privileges and franchises in and to all fixtures and articles of
personal property now or hereafter attached to or contained in and used in
connection with such buildings and improvements, including, without limitation,
all apparatus, furniture, furnishings, machinery, motors, elevators, fittings,
radiators, cooking ranges, ice boxes, ice machines, printing presses, mirrors,
bars, mechanical refrigerators, furnaces, coal and oil burning apparatus, wall
cabinets, machinery, generators, partitions, steam and hot water boilers,
lighting and power plants, pipes, plumbing, radiators, sinks, bath tubs, water
closets, gas and electrical fixtures, awnings, shades, screens, blinds,
dishwashers, freezers, vacuum cleaning systems, office equipment and other
furnishings, and all plumbing, heating, lighting, cooking, laundry, ventilating,
incinerating, air-conditioning and sprinkler equipment or other fire prevention
or extinguishing apparatus and material, and fixtures and appurtenances thereto;
and all renewals or replacements thereof or articles in substitution therefor,
whether or not the same are or shall be attached to the Land, any other land or
any interest therein hereafter acquired by Mortgagor or to any such buildings
and improvements thereon, in any manner.
(b) All of Mortgagor's rights, title, interest, privileges and franchises
in and to all other property, real, personal or mixed (other than Excepted
Property), of every kind and description and wheresoever situate, now owned or
which may be hereafter acquired by Mortgagor (including, without limitation, (i)
the Ground Lease Land, if Mortgagor acquires the fee simple title to the Ground
Lease Land or any part thereof whether by exercise of any or all of the options
contained in the Ground Leases or otherwise, and/or the Parking Lease Land or
any part thereof and/or any other Leased Facilities, if Mortgagor acquires fee
simple title to such Leased Facilities or any part thereof, (ii) all air rights
and rights to maintain supporting columns, all rights to construct and maintain
tunnels and bridges and other elevated structures, all rights to create private
rights of way over streets now or hereafter owned or enjoyed by Mortgagor
appurtenant to real property, including, without
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limitation, those rights, if any, granted by (x) any Ordinance granted by the
City of Atlantic City, New Jersey (the "City"), (y) deeds from the City and (z)
easements from the City, and (iii) to the extent assignable, all easements,
licenses, rights of way, gores of land, streets, ways, alleys, passages, sewer
rights, waters, water courses, water rights and powers, and all estates, rights,
titles, interests, privileges, franchises, liberties, tenements, hereditaments
and appurtenances of any nature whatsoever, in any way for the benefit of, or
belonging, relating or pertaining to, the Trust Estate), it being the intention
hereof that all property, interests, rights, privileges and franchises now owned
by Mortgagor or acquired by Mortgagor after the date hereof (other than Excepted
Property) shall be as fully embraced within and subjected to the Lien hereof as
if such property were specifically described herein.
* * *
TOGETHER with all of Mortgagor's right, title and interest in and to any
and all mineral and water rights and any title or reversion, in and to the beds
of the ways, streets, avenues and alleys adjoining the Premises to the center
line thereof and in and to all strips, gaps and gores adjoining the Premises on
all sides thereof; and
TOGETHER with any and all of Mortgagor's right, title and interest in and
to the tenements, hereditaments, easements, appurtenances, passages, waters,
water courses, riparian rights, other rights, liberties and privileges thereof
or in any way now or hereafter appertaining to the Premises, including, without
limitation, any other claim at law or in equity as well as any after-acquired
title, franchise or license and the reversion and reversions and remainder and
remainders thereof; and
TOGETHER with any and all awards and other compensation heretofore or
hereafter to be made to the present and all subsequent owners of the Trust
Estate for any taking by eminent domain, either permanent or temporary, of all
or any part of the Trust Estate or any easement or appurtenances thereof,
including severance and consequential damage and change in grade of streets, all
in accordance with and subject to the provisions of the Superior Instrument
Requirements and Section 5.19; and
TOGETHER with any and all proceeds of any unearned premiums on any
insurance policies described in Sections 5.11 and 5.12, and the right to receive
and
8
apply the proceeds of any insurance, judgments, or settlements made in lieu
thereof, for damage to the Trust Estate or otherwise, all in accordance with and
subject to the provisions of Section 5.11, Article IV of the Trust Indenture,
and the Superior Instrument Requirements.
EXCLUDING, with respect to all of the hereinabove granted property, rights,
title, interest, privileges and franchises described in Granting Clauses First
through Sixth and/or in the four immediately preceding paragraphs, all Excepted
Property now or hereafter existing.
TO HAVE AND TO HOLD all of said Premises, Leases, Facility Leases,
Operating Assets, properties, options, credits, deposits, rights, privileges and
franchises of every kind and description, real, personal or mixed, hereby and
hereafter granted, bargained, sold, alienated, assigned, transferred,
hypothecated, pledged, released, conveyed, mortgaged, or confirmed as aforesaid,
or intended, agreed or covenanted so to be, together with all the appurtenances
thereto appertaining (said Premises, Leases, Facility Leases, Operating Assets,
properties, options, credits, deposits, rights, privileges and franchises, other
than Excepted Property now or hereafter existing, being herein collectively
called the "Trust Estate") unto Mortgagee and its successors and assigns
forever.
SUBJECT, HOWEVER, to Permitted Liens (other than Restricted Encumbrances)
and Section 1.14.
BUT IN TRUST, NEVERTHELESS, for the benefit and security of the Secured
Creditors.
UPON CONDITION that, until the happening of an Event of Default, Mortgagor
shall be permitted to possess and use the Trust Estate, and to receive and use
the rents, issues, profits, revenues and other income of the Trust Estate.
AND IT IS HEREBY COVENANTED AND DECLARED that the Trust Estate is to be
held and applied by Mortgagee, subject to the further covenants, conditions and
trusts hereinafter set forth, and Mortgagor does hereby covenant and agree to
and with Mortgagee, for the benefit of the Secured Creditors, as follows:
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ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF
GENERAL APPLICATION
Section 1.01. Definitions.
For all purposes of this Mortgage, except as otherwise expressly provided
or unless the context otherwise requires:
(a) the terms defined in this Article One have the meanings assigned
to them in this Article One and include the plural as well as the singular;
(b) all accounting terms not otherwise defined herein have the
meanings assigned to them, and all computations herein provided for shall
be made, in accordance with generally accepted accounting principles in
effect on the date hereof consistently applied; and
(c) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Mortgage as a whole and not to any particular
Article, Section or other subdivision.
"Affiliate" has the meaning set forth in Section 1.1 of the Trust
Indenture.
"Alterations" has the meaning set forth in Section 5.12.
"Architect" means an Independent Person selected by Mortgagor and licensed
as an architect or engineer in the State of New Jersey.
"Assignment of Leases and Rents" means the Assignment of Leases and Rents
of even date herewith made by Mortgagor, as assignor, in favor of Mortgagee, as
assignee.
"Bankruptcy Law" has the meaning set forth in Section 1.1 of the Trust
Indenture.
"Casino" means that portion of the Casino Hotel used for gaming and related
activities.
"Casino Hotel" means the casino and hotel complex currently known as the
"Trump Taj Mahal Casino Resort" in Atlantic City, New Jersey and ancillary
structures and facilities located on the Premises and all furniture, fixtures
and equipment at any time contained therein in each case owned by or leased to
Mortgagor and covered by the Lien of the Mortgage Documents.
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"Casualty" means any act or occurrence of any kind or nature which results
in damage, loss or destruction to any buildings or improvements on the Premises
and/or Tangible Personal Property.
"Code" means the Federal Bankruptcy Code, Title 11 of the United States
Code, as amended.
"Collateral Agency Agreement" means the Collateral Agency Agreement, dated
as of the date hereof, by and among Mortgagee, Trustee, the Issuers, the
Guarantors and such other persons as may be permitted to become parties
thereunder in accordance with its terms and the terms of the Trust Indenture, as
the same may be amended from time to time in accordance with its terms.
"Company" means Trump Atlantic City Associates, a New Jersey partnership.
"Comparable Provision" has the meaning set forth in Section 5.20(b)(viii).
"Debt Documents" has the meaning set forth in Section 1 of the Collateral
Agency Agreement.
"Default" means any event which is, or after notice or lapse of time or
both would be, an Event of Default. Without limiting the generality of the
previous provisions of this definition, the term "Default" shall include the
occurrence of an event as to which a notice of default has been given to
Mortgagor under any Facility Lease by a Lessor, which has not yet been cured.
"Designated Representatives" has the meaning set forth in Section 1 of the
Collateral Agency Agreement.
"Event of Default" has the meaning set forth in Section 3.01.
"Excepted Property" means:
(1) the personal property owned by lessees under Leases and the
personal property of any Hotel guests;
(2) counterchecks and any other property to the extent that the
granting of a security interest therein is prohibited by the New Jersey
Casino Control Act, N.J.S.A. 5:12-1 et seq., and the regulations
promulgated thereunder;
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(3) tradenames, intellectual property rights and interests in and to
the use of the terms "Trump Taj Mahal Casino Resort", "Trump", "Donald J.
Trump",", "Donald Trump" or related variations thereof;
(4) all cash and Cash Equivalents (as defined in the Trust Indenture)
to the extent such cash and Cash Equivalents are not required to be pledged
to the Collateral Agent as security for the Obligations pursuant to the
terms of the Trust Indenture; and
(5) any property deemed to be Excepted Property pursuant to the
provisions of Section 2.03.
"Existing Encumbrances" means the Liens existing as of April 17, 1996 after
giving effect to the "Merger Transaction" (as such term is defined in the
Prospectus).
"Facility Leases" means, collectively:
(1) the Ground Leases;
(2) any other lease now existing or hereafter entered into or assumed
by Mortgagor as lessee with respect to any real property, whether it be
land, land and buildings and improvements thereon or only buildings and
improvements (excluding the Parking Leases), which is material to the
operation of the Mortgagor or which is necessary for the normal operation
of the Casino Hotel in accordance with all Legal Requirements and all
Permits; and
(3) any and all modifications, extensions and renewals of the leases
described in clauses (1) and (2) above, to the extent the same are
permitted under Section 5.20.
"F,F&E Financing Agreement" has the meaning set forth in Section 1.1 of the
Trust Indenture.
"Full Insurable Value" means the actual replacement cost (excluding the
costs of foundation, footing, excavation, paving, landscaping and other similar,
noninsurable improvements) of the insurable properties in question.
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"Ground Lease Land" means the real property described in Schedule 2.
"Ground Leases" means the leases described in Schedule 2 as amended or
supplemented to the extent permitted by Section 5.20.
"Guarantee" means collectively, each guarantee made from time to time by
the Guarantors of the Issuers' Indenture Obligations (as defined in the Trust
Indenture) pursuant to Article Thirteen of the Trust Indenture.
"Guarantors" has the meaning set forth in Section 1.1 of the Trust
Indenture.
"Holder" has the meaning set forth in Section 1.1 of the Trust Indenture.
"Hotel" means that portion of the Casino Hotel not included within the
Casino.
"Impositions" has the meaning set forth in Section 5.08.
"Indebtedness" has the meaning set forth in Section 1.1 of the Trust
Indenture.
"Independent" when used with respect to any specified Person means such a
Person who (i) is in fact independent, (ii) does not have any direct financial
interest or any material indirect financial interest in Mortgagor or in any
Affiliate of Mortgagor and (iii) is not connected with Mortgagor or any
Affiliate of Mortgagor as an officer, employee, promoter, underwriter, trustee,
partner, director or person performing similar functions. Whenever it is herein
provided that any Independent Person's opinion or certificate shall be furnished
to Mortgagee, such opinion or certificate shall state that the signer has read
this definition and that the signer is Independent within the meaning thereof. A
Person who is performing or who has performed services as an independent
contractor to any specified Person shall not be considered not Independent
merely by reason of the fact that such Person is performing or has performed
such services.
"Insurance Amount" has the meaning set forth in Section 5.11(a)(i).
"Insurance Requirements" means all terms of any insurance policy covering
or applicable to the Trust Estate or any part thereof, all requirements of the
issuer of any such policy, and all orders, rules, regulations
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and other requirements of the National Board of Fire Underwriters (or any other
body exercising similar functions) applicable to or affecting the Trust Estate
or any part thereof or any use or condition of the Trust Estate or any part
thereof.
"Insurer" means (i) an insurance company or companies selected by Mortgagor
authorized to issue insurance in the State of New Jersey with an A.M. Best &
Company, Inc. rating level of A minus or better and an A.M. Best & Company, Inc.
financial size category of X or better or, if such carrier is not rated by A.M.
Best & Company, Inc., having the financial stability and size deemed appropriate
by an opinion from a reputable insurance broker.
"Issuers" has the meaning set forth in Section 1.1 of the Trust Indenture.
"Land" means, collectively, the Owned Land and the Leased Land.
"Lease" means each lease or sublease (made by Mortgagor as lessor or
sublessor, as the case may be) of any space in any building or buildings, an
interest in which building or buildings constitutes a part of the Trust Estate,
including every agreement relating thereto or entered into in connection
therewith and every guarantee of the performance and observance of the
covenants, conditions and agreements to be performed by the lessee or sublessee
under any such lease or sublease. For purposes hereof, the term "Lease" shall
include any license agreement, concession agreement or other occupancy
agreement. Notwithstanding the foregoing, the term "Lease" shall not include any
transient room rentals.
"Leased Facilities" means, collectively, the Leased Land and any buildings
and improvements now or hereafter located thereon.
"Leased Land" means, collectively, the Ground Lease Land and any other land
that is now or hereafter subject to a Facility Lease.
"Legal Requirements" means all laws, statutes, codes, acts, ordinances,
orders, judgments, decrees, injunctions, rules, regulations, permits, licenses,
authorizations, directions and requirements (including, without limitation, the
New Jersey Casino Control Act, the New Jersey Industrial Site Recovery Act and
the New Jersey Spill Compensation and Control Act of 1976) of all governments,
departments, commissions, boards, courts, authorities, agencies, officials and
officers, of governments,
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federal, state and municipal (including, without limitation, the New Jersey
Department of Environmental Protection, the Atlantic City Bureau of
Investigations, the Division of Gaming Enforcement of the State of New Jersey,
and the Casino Control Commission of the State of New Jersey, foreseen or
unforeseen, ordinary or extraordinary, which now are or at any time hereafter
become applicable to the Trust Estate or any part thereof, or any of the
adjoining sidewalks, or any use or condition of the Trust Estate or any part
thereof, including, without limitation, the use of the Casino Hotel as a gaming
or gambling facility.
"Lessors" means the lessors under the Facility Leases.
"Lien" has the meaning set forth in Section 1.1 of the Trust Indenture.
"Material Instrument Requirements" means the applicable terms, conditions
and provisions of (i) the Ground Leases with respect to the Ground Lease Land,
(ii) the Parking Leases with respect to the Parking Lease Land and (iii) any
other Facility Lease with respect to the portion of the Premises covered
thereby.
"Maturity" when used with respect to any Indebtedness means the date on
which the principal (or any portion thereof) of such Indebtedness becomes due
and payable as therein or herein provided, whether at the Stated Maturity, upon
acceleration, optional redemption, required repurchase, scheduled principal
payment or otherwise.
"Mortgage" means this Indenture of Mortgage and Security Agreement, as
amended or supplemented from time to time in accordance with the terms hereof.
"Mortgage Documents" has the meaning set forth in Section 1.1 of the Trust
Indenture.
"Mortgage Notes" means the Issuers' First Mortgage Notes due 2006 in an
aggregate principal amount of $1,200,000,000, issued pursuant to the Trust
Indenture, including the guarantees thereof by the Guarantors.
"Mortgagee" means the Persons named as "Mortgagee" in the first paragraph
of this instrument including any successor entity which shall have become such
pursuant to the applicable provisions of the Collateral Agency Agreement and
this Mortgage.
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"Mortgagor" means the Person named as "Mortgagor" in the first paragraph of
this instrument including any successor entity which shall have become such
pursuant to the applicable provisions of this Mortgage.
"Mortgagor Request" means a written request of the Mortgagor in the form of
an Officers' Certificate.
"Notices" has the meaning set forth in Section 1.02.
"Obligations" has the meaning set forth in Section 1 of the Collateral
Agency Agreement.
"Officer" has the meaning set forth in Section 1.1 of the Trust Indenture.
"Officers' Certificate" has the meaning set forth in Section 1.1 of the
Trust Indenture.
"Operating Assets" has the meaning set forth in Granting Clause Fifth.
"Opinion of Counsel" has the meaning set forth in Section 1.1 of the Trust
Indenture.
"Original Policy" means the ALTA Loan Policies of Title Insurance issued by
Commonwealth Land Title Insurance Company, First American Title Insurance Co.
and Chicago Title Insurance Company, pursuant to Commonwealth Land Title
Insurance Company Title Commitment No. F238427L and Commonwealth Land Title
Insurance Company Title Commitment No. F239636L, redated the date hereof,
insuring Mortgagee as to the Liens of this Mortgage and the Plaza Mortgage in an
aggregate amount of not less than $1,200,000,000.
"Outstanding Amount" has the meaning set forth in Section 1.1 of the Trust
Indenture.
"Owned Land" has the meaning set forth in Granting Clause First.
"Parking Lease Land" means the real property described in Schedule 3.
"Parking Leases" means the leases and licenses described in Schedule 3.
"Permits" has the meaning set forth in Section 1.1 of the Trust Indenture.
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"Permitted Liens" has the meaning set forth in Section 1.1 of the Trust
Indenture. All references to the subsections of the definition of Permitted
Liens shall mean the subsections of the definition of Permitted Liens as set
forth in the Trust Indenture.
"Person" means any individual, corporation, limited or general partnership,
joint venture, association, joint stock company, trust, unincorporated
organization or any other entity or government or any agency or political
subdivision thereof.
"Plaza Mortgage" means the Indenture of Mortgage and Security Agreement,
dated as of the date hereof, made by Trump Plaza Associates for the benefit of
Mortgagee, as amended or supplemented from time to time in accordance with the
terms thereof.
"Premises" has the meaning set forth in Granting Clause Third.
"Prospectus" has the meaning set forth in Section 1.1 of the Trust
Indenture.
"Refinancing Indebtedness" has the meaning set forth in Section 1.1 of the
Trust Indenture.
"Restricted Encumbrances" means (i) Leases which are subordinate to or
shall be subordinate to the Lien of this Mortgage pursuant to Section 5.13, (ii)
the Mortgage Documents, and any other instrument now or hereafter executed, as
additional security for the obligations secured by this Mortgage, (iii) any Lien
which pursuant to the terms of the Trust Indenture, the Collateral Agency
Agreement and the terms hereof is to be subordinate to, or pari passu with, the
Lien of this Mortgage and (iv) the leases and licenses which as of April 17,
1996 are subordinate to the Lien of this Mortgage pursuant to their terms or the
terms of any non-disturbance agreement executed in connection therewith; it
being intended that Restricted Encumbrances constitute those Permitted Liens
which are subordinate to, or pari passu with, the Lien of this Mortgage.
"Securities Act" has the meaning set forth in Section 1.1 of the Trust
Indenture.
"Secured Beneficiaries" has the meaning set forth in Section 1 of the
Collateral Agency Agreement.
"Secured Loans" has the meaning set forth in Section 1 of the Collateral
Agency Agreement.
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"Security Agreement" means the Security Agreement, dated as of the date
hereof, among the Issuers, Guarantors and Mortgagee.
"Stated Maturity" has the meaning set forth in Section 1.1 of the Trust
Indenture.
"Subsidiaries" has the meaning set forth in Section 1.1 of the Trust
Indenture.
"Tangible Personal Property" has the meaning set forth in Granting Clause
Fifth.
"Trust Estate" has the meaning stated in the habendum to the Granting
Clauses.
"Trust Indenture" means that certain Indenture of even date herewith among
Mortgagor, the Issuers, Guarantors and First National Bank Association, as
Trustee, as it may from time to time be supplemented, modified or amended in
accordance with its terms by one or more trust indentures or other instruments
supplemental thereto entered into pursuant to the applicable provisions thereof,
a form of which (without exhibits) is attached hereto as Exhibit A.
"Trust Indenture Act" has the meaning set forth in Section 1.1 of the Trust
Indenture.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
the Trust Indenture and any successor thereto.
"Uniform Commercial Code" means the New Jersey Uniform Commercial Code
N.J.S.A. 12A:1-101 et seq.
Section 1.02. Notices.
(a) Any request, demand, authorization, direction, notice (including,
without limitation, a notice of default), consent, waiver or other document
provided or permitted by this Mortgage to be made upon, given or furnished to,
or filed with, Mortgagor or Mortgagee (collectively, "Notices") shall be in
writing and shall be sufficiently given if made by hand delivery, by telex, by
telecopier or registered or certified mail, postage prepaid, return receipt
requested, addressed as follows:
To Mortgagor:
Trump Taj Mahal Associates
Mississippi Avenue and The Boardwalk
Atlantic City, New Jersey 08401
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Attn: Chief Financial Officer
with a copy to:
Willkie Farr & Gallagher
One Citicorp Center
153 East 53rd Street
New York, New York 10022
Attn: Jack H. Nusbaum, Esq.
To Mortgagee:
First Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Attn: Corporate Trust Department
(b) Mortgagee or Mortgagor by notice in accordance with the terms hereof to
the other party may designate additional or different addresses as shall be
furnished in writing by such party. Any notice or communication to the Mortgagee
or Mortgagor shall be deemed to have been given or made as of the date so
delivered, if personally delivered; when answered back, if telexed; when receipt
is acknowledged, if telecopied; and 5 Business Days after mailing if sent by
registered or certified mail, postage prepaid (except that a notice of change of
address shall not be deemed to have been given until actually received by the
addressee).
Section 1.03. Form and Contents of Documents
Delivered to Mortgagee.
Any Officers' Certificate or Opinion of Counsel delivered to Mortgagee in
connection with this Mortgage shall be in compliance with the provisions of
Section 12.5 of the Trust Indenture.
Every application, certificate, report, affidavit, opinion, consent,
statement or other instrument required to be delivered to Mortgagee under this
Mortgage or under any other Mortgage Document shall be in writing and shall be
prepared and delivered without cost or expense to Mortgagee.
Section 1.04. Compliance Certificates and Opinions.
Upon any application or request by Mortgagor to Mortgagee to take any
action under any provision of this Mortgage, Mortgagor shall furnish to
Mortgagee an Officers' Certificate and an Opinion of Counsel in compliance with
the provisions of Section 12.4 of the Trust Indenture.
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Section 1.05. Effect of Headings and Table of Contents.
The Article and Section headings herein and in the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 1.06. Successors and Assigns; Amendments.
(a) Subject to the provisions of Section 1.10 hereof and Section 6.2 of the
Trust Indenture, and without limiting the generality of Section 1.12 hereof,
this Mortgage shall be binding upon and inure to the benefit of the parties
hereto and of the respective successors and assigns of the parties hereto to the
same effect as if each such successor or assign were in each case named as a
party to this Mortgage.
(b) This Mortgage may not be modified, amended, discharged, released nor
any of its provisions waived except by agreement in writing executed by
Mortgagor and Mortgagee and in accordance with the provisions of this Mortgage
and the Trust Indenture.
Section 1.07. Separability Clause.
In case any provision in this Mortgage shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Section 1.08. Benefits of Mortgage.
Without limiting the generality of Section 1.12, nothing in this Mortgage,
express or implied, shall give to any Person, other than the parties hereto and
their successors and assigns, any benefit or any legal or equitable right,
remedy or claim under this Mortgage.
Section 1.09. Governing Law.
This Mortgage shall be deemed to be a contract under the laws of the State
of New Jersey and shall be construed in accordance with and governed by the laws
of the State of New Jersey.
Section 1.10. Limitation on LiabilityLimitation on Liability.
A direct or indirect partner, director, officer, employee or stockholder,
as such, past, present or future of the Mortgagor or any successor entity shall
not have any personal liability in respect of the obligations under this
Mortgage by reason of his or its status as such partner, director, officer,
employee or stockholder
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except to the extent such is an Issuer or a Guarantor. Each Holder by accepting
a Security (as defined in the Trust Indenture) waives and releases all such
liability. Such waiver and release are part of the consideration for the
issuance of the Securities.
Section 1.11. Provisions Required by Trust Indenture.
Whenever the provisions of this Mortgage and the provisions of the Trust
Indenture shall be inconsistent, the provisions of the Trust Indenture shall
govern.
Section 1.12. Rights of Mortgagee.
(a) Except as otherwise provided in Section 5 of the Collateral Agency
Agreement:
(i) Mortgagee may rely, and shall be protected in acting or refraining
from acting, upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the
proper party or parties;
(ii) any request or direction of Mortgagor mentioned herein shall be
sufficiently evidenced by a Mortgagor Request;
(iii) whenever in the administration of this Mortgage, Mortgagee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, Mortgagee (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officers' Certificate;
(iv) Mortgagee may consult with counsel and any written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by
Mortgagee hereunder in good faith and in reliance thereon;
(v) Mortgagee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
approval, appraisal, bond, debenture, note, coupon, security or other paper
or document but Mortgagee, in its discretion, may make such further inquiry
or investigation into such
21
facts or matters as it may see fit, and, if Mortgagee shall determine to
make such further inquiry or investigation, it shall be entitled (subject
to the express limitations with respect thereto contained in this Mortgage)
to examine the books, records and premises of Mortgagor, personally or by
agent or attorney;
(vi) Mortgagee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys, and Mortgagee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder;
(vii) Mortgagee shall not be personally liable, in case of entry by it
upon the Trust Estate, for debts contracted or liabilities or damages
incurred in the management or operation of the Trust Estate; and
(viii) no provision of this Mortgage shall require Mortgagee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of its obligations hereunder, or in the exercise of any of its
rights or powers.
(b) The provisions of this Section 1.12 shall apply to all Mortgage
Documents.
Section 1.13. Mortgage Subject to Casino Control Act.
Each provision of this Mortgage is subject to and shall be enforced in
compliance with the provisions of the New Jersey Casino Control Act.
Section 1.14. Discharge of Lien.
If Mortgagor shall pay or cause to be paid, or there shall otherwise be
paid, to Mortgagee all amounts required to be paid by Mortgagor pursuant to the
this Mortgage and all Obligations pursuant to the Debt Documents, including,
without limitation, the Mortgage Notes and the Guarantee, shall have been
satisfied and (a) the conditions precedent for the Trust Indenture to cease,
determine and become null and void (except for any surviving rights of transfer
or exchange of the Mortgage Notes provided in the Trust Indenture and for the
obligation to pay the Trustee's fees and expenses provided in Section 8.7 of the
Trust Indenture) in accordance with Article Nine of the Trust Indenture shall
have occurred, or (b) there shall have occurred a Legal Defeasance (as
22
defined in Section 9.2 of the Trust Indenture) of the Mortgage Notes, or (c)
there shall have occurred a Covenant Defeasance (as defined in Section 9.3 of
the Trust Indenture), then in any such case Mortgagee shall promptly cancel and
discharge the Mortgage Documents, including, without limitation, this Mortgage,
and any financing statements filed in connection herewith and execute and
deliver to Mortgagor all such instruments as may be necessary, required or
appropriate to evidence such discharge and satisfaction of said Lien or Liens.
In connection with the disposition of all or any portion of the Trust Estate
free and clear of the Lien of this Mortgage in accordance with the terms of
Section 4.3 of the Trust Indenture, Mortgagee shall promptly execute and deliver
to Mortgagor all such instruments as may be necessary, required or appropriate
to evidence the release of such portion of the Trust Estate from the Lien of
this Mortgage. Upon such release, the terms, conditions and obligations
hereunder shall no longer apply to the portion of the Trust Estate so released
and all defined terms hereunder shall be deemed appropriately modified.
Section 1.15. General Application.
(a) The remedies of Mortgagee upon any default by Mortgagor in the
fulfillment of any of its obligations hereunder shall be limited in each
instance by the provisions of Section 1.10, whether or not the provisions
providing for such remedies explicitly refer to such Section.
(b) The assertion of any rights upon any Default shall be subject in each
instance to, if required, the giving of any notice and the expiration of any
grace period provided for in Section 3.01 as a condition to such Default
becoming an Event of Default, unless the Trust Indenture Act requires otherwise,
in which case the Trust Indenture Act shall control.
(c) For the purposes of this Mortgage, it is understood that an event which
does not materially diminish the value of Mortgagee's interest in the Trust
Estate shall not be deemed an "impairment of security," as that phrase is used
in this Mortgage.
Section 1.16. Mortgage Deemed to be Security Agreement.
To the extent that the grant of a security interest in any portion of the
Trust Estate is governed by the Uniform Commercial Code, this Mortgage is hereby
deemed to be as well a security agreement under the Uniform Commercial Code for
the purpose of creating hereby a
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security interest in all of Mortgagor's right, title and interest in and to said
property, securing the obligations secured hereby, for the benefit of Mortgagee.
ARTICLE TWO
RELEASE; SUBORDINATION
Section 2.01. Possession by Mortgagor.
So long as there shall have been no acceleration of maturity of any
Indebtedness secured hereby, including, without limitation, the Mortgage Notes,
Mortgagor shall be suffered and permitted, with power freely and without let or
hindrance on the part of Mortgagee, subject to the provisions of this Mortgage
and the Trust Indenture, to possess, use, manage, operate and enjoy the Trust
Estate and every part thereof and to collect, receive, use, invest and dispose
of the rents, issues, tolls, profits, revenues and other income from the Trust
Estate or any part thereof, to use, consume and dispose of any consumables,
goods, wares and merchandise in the ordinary course of business of operating the
Casino Hotel and to adjust and settle all matters relating to choses in action,
leases and contracts.
Section 2.02. Obsolete Property.
Mortgagor shall have the rights granted to it with respect to the
disposition of certain Tangible Personal Property secured hereby pursuant to
Section 4.3 of the Trust Indenture (but subject to all restrictions pertaining
thereto), the terms of which are incorporated herein by reference.
Mortgagee shall, from time to time, promptly execute any written instrument
in form satisfactory to Mortgagee to confirm the propriety of any action taken
by Mortgagor under this Section 2.02, upon receipt by Mortgagee of a Mortgagor
Request requesting the same, together with an Officers' Certificate stating that
the action so to be confirmed was duly taken in conformity with this Section
2.02, and that the execution of such written instrument is appropriate to
confirm the propriety of such action under this Section 2.02; provided, that
Mortgagee shall have no liability thereunder and all costs and expenses
(including, without limitation, reasonable attorneys' fees and disbursements)
shall be paid by Mortgagor.
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Section 2.03. F,F&E Financing Agreements.
Notwithstanding any provision contained in this Mortgage or the Trust
Indenture to the contrary, if Mortgagor has acquired or hereafter acquires
Tangible Personal Property and/or other items constituting operating assets
subject to any F,F&E Financing Agreement, or becomes the lessee under a lease
for any of the same and if the document evidencing such F,F&E Financing
Agreement prohibits subordinate Liens or the provisions of any such lease
prohibits any assignment thereof by the lessee, and if any such prohibition is
customary with respect to similar transactions of the lender or lessor (as
evidenced by an Officers' Certificate delivered to Mortgagee, together with such
other evidence as Mortgagee may reasonably request), as the case may be, then
the property so purchased or the lessee's interest in the lease, as the case may
be, shall be deemed to be Excepted Property. If any such F,F&E Financing
Agreement permits subordinate Liens then Mortgagee shall execute and deliver to
Mortgagor, at Mortgagor's expense, such documents as the holder of such F,F&E
Financing Agreement may reasonably request to evidence the subordination of the
Lien of this Mortgage and the Mortgage Documents to the Lien of such F,F&E
Financing Agreement.
Section 2.04. Intentionally Omitted.
ARTICLE THREE
REMEDIES
Section 3.01. Events of Default.
"Event of Default," whenever used herein, means an "Event of Default," as
defined in Section 7.1 of the Trust Indenture, shall occur and be continuing
(whatever the reason for such event and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body).
Section 3.02. Application of Moneys Received by
Mortgagee.
Any moneys received by Mortgagee pursuant to the provisions of this Article
Three (including moneys received after any action or act by Mortgagee under
Section 3.10) shall be applied by Mortgagee in accordance with the provisions of
Section 7.6 of the Trust Indenture.
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Section 3.03. Restoration of Rights and Remedies.
If Mortgagee has instituted any proceeding to enforce any right or remedy
under this Mortgage and such proceeding has been discontinued or abandoned for
any reason or has been determined adversely to Mortgagee, then and in every such
case Mortgagor and Mortgagee shall, subject to any determination in such
proceeding, be restored to their respective former positions hereunder, and
thereafter all rights and remedies of Mortgagee shall continue as though no such
proceeding had been instituted.
Section 3.04. Rights and Remedies Cumulative.
No right or remedy herein conferred upon or reserved to Mortgagee is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 3.05. Delay or Omission Not Waiver.
No delay or omission of Mortgagee to exercise any right or remedy accruing
upon an Event of Default shall impair any such right or remedy or constitute a
waiver of any such Event of Default or an acquiescence therein. Every right and
remedy given by this Article Three or by applicable law to Mortgagee may be
exercised, from time to time, and as often as may be deemed expedient, by
Mortgagee.
Section 3.06 Undertaking for Costs.
If any action or proceeding shall be commenced (including, without
limitation, an action to foreclose this Mortgage or to collect the Indebtedness
or under the Guarantee secured hereby) to which action or proceeding Mortgagee
is made or becomes a party, or in which it becomes necessary in the opinion of
Mortgagee to defend or uphold the Lien of this Mortgage, then Mortgagor shall
pay to Mortgagee all expenses, including, without limitation, reasonable
attorneys, fees, disbursements and court costs incurred by Mortgagee in
connection therewith, together with interest at the rate then payable on such
Indebtedness, from the date of payment less the net amount received by
Mortgagee, as its interest may appear under any title insurance policy, and,
until paid, all
26
such expenses, together with interest as aforesaid, shall be secured by the Lien
of this Mortgage.
Section 3.07. Waiver of Appraisement and Other Laws.
To the full extent that it may lawfully so agree, Mortgagor will not at any
time insist upon, plead, claim or take the benefit or advantage of, any
appraisement, valuation, stay, extension or redemption law now or hereafter in
force, in order to prevent or hinder the enforcement of this Mortgage or the
absolute sale of the Trust Estate, or any part thereof, or the possession
thereof by any purchaser at any sale under this Article Three; and Mortgagor,
for itself and all who may claim under Mortgagor, so far as Mortgagor or they
now or hereafter may lawfully do so, hereby waives the benefit of all such laws.
Mortgagor, for itself and all who may claim under Mortgagor, waives, to the
extent that Mortgagor may lawfully do so, all right to have the property in the
Trust Estate marshalled upon any foreclosure hereof, and agrees that any court
having jurisdiction to foreclose this Mortgage may order the sale of the Trust
Estate as an entirety.
If any law in this Section 3.07 referred to and now in force, of which
Mortgagor or its successor or successors might take advantage despite this
Section 3.08, shall hereafter be repealed or cease to be in force, such law
shall not thereafter be deemed to constitute any part of the contract herein
contained or to preclude the application of this Section 3.07.
Section 3.08. Entry.
Mortgagor agrees that upon the occurrence, and during the continuance, of
an Event of Default, Mortgagor, upon demand of Mortgagee, shall forthwith
surrender to Mortgagee the actual possession of, and it shall be lawful for
Mortgagee by such officers or agents as it may appoint to enter and take
possession of, the Trust Estate (and the books and papers of Mortgagor), and to
hold, operate and manage the Trust Estate (including the making of all needful
repairs, and such alterations, additions and improvements as Mortgagee shall
deem wise) and to receive the rents, issues, tolls, profits, revenues and other
income thereof, and, after deducting the costs and expenses of entering, taking
possession, holding, operating and managing the Trust Estate, as well as
payments for taxes, insurance and other proper charges upon the Trust Estate and
reasonable compensation to itself, its agents and counsel, to apply the same as
provided in Section 3.02; provided, however, that Mortgagee's rights under this
Section 3.08 shall be subject to the provisions
27
of the New Jersey Casino Control Act and Section 3.13. Whenever all that is then
due upon the Debt Documents, including without limitation, the Mortgage Notes
and under any of the terms of this Mortgage shall have been paid and all
defaults hereunder shall have been cured, Mortgagee shall surrender possession
to Mortgagor.
Section 3.09. Power of Sale; Suits for Enforcement.
If an Event of Default shall occur and be continuing, Mortgagee, with or
without entry, in its discretion, may:
(a) sell, subject to any mandatory requirements of applicable law, the
Trust Estate as an entirety, or in such parcels, as Mortgagee may
determine, to the highest bidder at public auction at such place and at
such time (which sale may be adjourned by Mortgagee from time to time in
its discretion by announcement at the time and place fixed for such sale,
without further notice) and upon such terms as Mortgagee may fix and
briefly specify in a notice of sale to be published as required by law; or
(b) proceed to protect and enforce its rights under this Mortgage by
sale pursuant to judicial proceedings or by a suit, action or proceeding in
equity or at law or otherwise, whether for the specific performance of any
covenant or agreement contained in this Mortgage or in aid of the execution
of any power granted in this Mortgage or for the foreclosure of this
Mortgage or for the enforcement of any other legal, equitable or other
remedy, as Mortgagee shall deem most effectual to protect and enforce any
of the rights of Mortgagee; the failure to join tenants shall not be
asserted as a defense to any foreclosure or proceeding to enforce the
rights of Mortgagee.
Section 3.10 Incidents of Sale.
Upon any sale of any of the Trust Estate, whether made under the power of
sale hereby given or pursuant to judicial proceedings, to the extent permitted
by law:
(a) subject to the provisions of Section 3.13 and the receipt of any
required prior approvals of the New Jersey Casino Control Commission,
Mortgagee may bid for and purchase the property offered for sale, and upon
compliance with the terms of sale may hold, retain, possess and dispose of
such property, without further accountability, and may, in paying the
purchase money therefor, deliver the Mortgage Notes or any other Debt
28
Document or claims for interest thereon in lieu of cash to the amount which
shall, upon distribution of the net proceeds of such sale, be payable
thereon, and the Mortgage Notes or any other Debt Document, in case the
amounts so payable thereon shall be less than the amount due thereon, shall
be returned to Mortgagee after being appropriately stamped to show partial
payment;
(b) Mortgagee may make and deliver to the purchaser or purchasers a
good and sufficient deed, bill of sale and instrument of assignment and
transfer of the property sold;
(c) Mortgagee is hereby irrevocably appointed the true and lawful
attorney of Mortgagor, in its name and stead, to make all necessary deeds,
bills of sale and instruments of assignment and transfer of the property
thus sold; and for that purpose it may execute all necessary deeds, bills
of sale and instruments of assignment and transfer, and may substitute one
or more persons, firms or corporations with like power, Mortgagor hereby
ratifying and confirming all that its said attorney or such substitute or
substitutes shall lawfully do by virtue hereof; but if so requested by
Mortgagee or by any purchaser, Mortgagor shall ratify and confirm any such
sale or transfer by executing and delivering to Mortgagee or to such
purchaser or purchasers all proper deeds, bills of sale, instruments of
assignment and transfer and releases as may be designated in any such
request;
(d) all right, title, interest, claim and demand whatsoever, either at
law or in equity or otherwise, of Mortgagor of, in and to the property so
sold shall be divested and such sale shall be a perpetual bar both at law
and in equity against Mortgagor, its successors and assigns, and against
any and all persons claiming or who may claim the property sold or any part
thereof from, through or under Mortgagor, its successors and assigns; and
(e) the receipt of Mortgagee or of the officer making such sale shall
be a sufficient discharge to the purchaser or purchasers at such sale for
his or their purchase money and such purchaser or purchasers and his or
their assigns or personal representatives shall not, after paying such
purchase money and receiving such receipt, be obliged to see to the
application of such purchase money, or be in anywise answerable for any
loss, misapplication or non-application thereof.
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Section 3.11. Receiver.
Upon the occurrence of an Event of Default and commencement of judicial
proceedings by Mortgagee to enforce any right under this Mortgage, Mortgagee
shall be entitled, as against Mortgagor, without notice or demand and without
regard to the adequacy of the security for the Mortgage Notes, the Guarantee or
any other Debt Document or the solvency of Mortgagor, to the appointment of a
receiver of the Trust Estate, and of the rents, issues, profits, revenues and
other income thereof; provided, however, that Mortgagee's rights under this
Section 3.11 shall be subject to the provisions of the New Jersey Casino Control
Act and Section 3.13 hereof.
Section 3.12. Suits to Protect the Trust Estate.
Mortgagor hereby acknowledges the right of Mortgagee, in the name and on
behalf of Mortgagor, (a) to appear in and defend any action or proceeding
brought with respect to the Trust Estate or any part thereof and (b) upon 5
days' prior notice to Mortgagor (or such shorter period or without notice if
deemed necessary and appropriate by Mortgagee), Mortgagee shall have power to
institute and to maintain such proceedings as Mortgagee may deem necessary and
appropriate, but in the case of (a) and (b) to prevent any impairment of
security or any impairment of the Trust Estate in all cases by any acts which
may be unlawful or in violation of this Mortgage and to protect Mortgagee's
interests in the Trust Estate and in the rents, issues, profits, revenues and
other income arising therefrom, including the right to institute and maintain
proceedings to restrain the enforcement of or compliance with any governmental
enactment, rule or order that may be unconstitutional or otherwise invalid, if
the enforcement of or compliance with such enactment, rule or order would impair
the security hereunder or be materially prejudicial to the interests of
Mortgagee.
Section 3.13. Management of the Premises.
Without limiting the generality of any other provision of this Article
Three, following an Event of Default and the taking of possession of the Trust
Estate or any part thereof by Mortgagee and/or the appointment of a receiver of
the Trust Estate or any part thereof, Mortgagee or any such receiver shall be
authorized, in addition to the rights and powers of Mortgagee and such receiver
set forth elsewhere in this Mortgage, to take any action permitted under Article
Seven of the Trust Indenture.
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ARTICLE FOUR
CONSOLIDATION, MERGER, CONVEYANCE,
TRANSFER OR LEASE
Section 4.01. Consolidation, Merger, Conveyance
or Transfer only on Certain Terms.
Mortgagor shall be bound by all provisions applicable to Mortgagor in
Section 13.6 of the Trust Indenture, the terms of which are incorporated herein
by reference.
ARTICLE FIVE
COVENANTS AND REPRESENTATIONS OF MORTGAGOR
Section 5.01. Performance of Obligations.
Mortgagor shall duly and punctually pay and perform the Obligations in
accordance with the terms of the Debt Documents to which it is a party
(including, without limitation, Article Thirteen of the Trust Indenture).
Section 5.02. F,F&E Financing Agreements.
Mortgagor shall comply with all of the terms and conditions set forth in
any F,F&E Financing Agreements before the expiration of any applicable notice
and cure periods contained in any such F,F&E Financing Agreements.
Section 5.03. Limitations on Liens and Transfers.
(a) Except as otherwise expressly permitted under this Mortgage and the
Trust Indenture (including, without limitation, Article Five of the Trust
Indenture), Mortgagor shall not create, incur, suffer or permit to be created or
incurred or to exist any Lien on all or any portion of the Trust Estate, other
than Permitted Liens.
(b) The Lien of this Mortgage shall be subject and subordinate to the Lien
of any Existing Encumbrances and the Permitted Liens described in subsections
(a) (other than with respect to Refinancing Indebtedness of the Securities (as
defined in the Trust Indenture)), (c)(but only to the extent that such F,F&E
Financing Agreement requires the Lien of this Mortgage to be subordinate
thereto), (i) and (j) (but only to the extent that such Acquired Indebtedness
(as defined in the Trust Indenture) requires the Lien of this Mortgage to be
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subordinate thereto) of the definition of Permitted Lien, to the extent that
each thereof encumbers Mortgagor's interest in the Trust Estate or any part
thereof. The foregoing provisions of this Section 5.03(b) shall be
self-operative and no further instrument shall be required to give effect to
such subordination.
(c) Mortgagor shall not sell, assign, lease or otherwise transfer all or
any portion of the Trust Estate or any interest therein (including, without
limitation, any interest in the Ground Leases) in violation of the terms of this
Mortgage or the terms of the Trust Indenture (including, without limitation,
Sections 4.3 and 13.6 of the Trust Indenture). Without limiting the generality
of the foregoing, Mortgagor shall not separate, or attempt to separate, its
ownership of its interest in the Ground Leases from the ownership of the
buildings constituting the Casino Hotel or any part thereof. Notwithstanding the
foregoing, Mortgagor shall have the right, at any time and from time to time,
unless an Event of Default shall have occurred and be continuing, without any
release from or consent by Mortgagee, to grant Permitted Liens; provided, (i)
that none of the same will reduce or impair, in any material respect, (A) the
value or usefulness of the Trust Estate or (B) the normal operation of the
Casino Hotel in accordance with all Legal Requirements and all Permits, (ii) no
Event of Default has occurred and is continuing and (iii) Mortgagor shall
promptly deliver to Mortgagee a duplicate original of the instrument, if any,
pursuant to which such grant is to be made, and such other instruments,
certificates and opinions as Mortgagee may reasonably request. The foregoing
provisions of this Section 5.03(c) shall be self-operative and no further
instrument shall be required to evidence the consent of Mortgagee to the grant
or other conveyance of such rights-of-way or easements. Mortgagee shall,
however, from time to time, after receipt of a Mortgagor Request therefor
(accompanied by an Officers' Certificate stating that said conditions have been
satisfied) execute instruments in form and substance reasonably satisfactory to
Mortgagee confirming the permissibility of such grant or other conveyance but
only with respect to the Permitted Liens incurred after the date hereof
described in subsections (a) (but only with respect to Refinancing
Indebtedness), (d), (e), (i), (j) and (k) of the definition of Permitted Liens.
Section 5.04. Environmental.
Without limiting the generality of any other provision of this Mortgage,
Mortgagor covenants, represents and warrants to Mortgagee as follows:
32
(a) Mortgagor shall comply with any and all federal, state and local
environmental legislation, rules, and regulations in effect as of the date
of this Mortgage and subsequent thereto, including, without limitation, the
Spill Compensation and Control Act (N.J.S.A. 58:10-23.11 et seq.) (the
"Spill Act"); the Industrial Site Recovery Act (N.J.S.A. 13:lK-6 et seq.)
("ISRA"); the Solid Waste Management Act (N.J.S.A. 13:E-1 et seq.); the
Resource, Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.)
("RCRA"); the Comprehensive Environmental Response, Compensation and
Liability Act (42 U.S.C. Section 9601 et seq.) ("CERCLA"), each as amended,
and such other environmental legislation, rules and regulations, as are in
or may come into effect and apply to (i) Mortgagor and/or Mortgagee with
respect to the Premises or (ii) the transactions contemplated hereby, and
as to any occupants or users of the collateral, whether as lessees,
tenants, licensees or otherwise, Mortgagor shall use its best efforts to
cause same to comply with said legislation, rules and regulations.
Mortgagor agrees to pay all costs required in connection with compliance
with the foregoing legislation, rules and regulations.
(b) Mortgagor has not used in the past, nor shall Mortgagor use in the
future, the Premises for the purpose of refining, producing, storing,
handling, transferring, processing or transporting "Hazardous Substances",
as such term is defined in ISRA, the Spill Act, CERCLA or the regulations
relating thereto, except that Mortgagor and its subsidiaries have used, and
Mortgagor may continue in the future to use, substances in the operation
and maintenance of the Premises, including, without limitation, heating
oil, gasoline and cleaning chemicals which could be considered as
"Hazardous Substances" under the preceding definition.
(c) To the best of Mortgagor's knowledge, after due inquiry and
investigation, none of the real property owned, leased and/or occupied by
Mortgagor and located in the State of New Jersey, including, without
limitation, the Premises, has been or is now being used as a "Major
Facility" as such term is defined in N.J.S.A. 58:10-23.llb(l). Mortgagor
will not use the Premises in the future as a "Major Facility".
(d) To the best of Mortgagor's knowledge, after due inquiry and
investigation, no Lien has been attached to any revenues or any real or
personal property owned by Mortgagor or the Premises, as a result of the
Chief Executive of the New Jersey Spill Compensation Fund expending monies
from said fund to pay for "Cleanup Costs", as such term is defined in
N.J.S.A. 58:10-23.llb(d),
33
arising from an intentional or unintentional action or omission of
Mortgagor or any previous owner and/or operator of such real property.
(e) There is no asbestos or asbestos containing material on the
Premises currently owned, operated or leased by Mortgagor, other than
asbestos-containing materials located at the Virginia Avenue warehouse
owned by Mortgagor and the Terrace Building located on Pennsylvania Avenue,
which are in good condition and in compliance with applicable law. To the
best of Mortgagor's knowledge, after due inquiry and investigation, there
are no underground storage tanks located at or on the Premises, with the
exception of two (2) underground storage tanks located at the Casino Hotel
and three (3) underground storage tanks located at the Pleasantville
Warehouse (as defined in the Trust Indenture), all of which are in
compliance with applicable law. In addition, there is another underground
storage tank located at Parking Lot C on Virginia Avenue which will be
excavated by the Company at a cost which is not material to the Company and
its Subsidiaries. Mortgagor has not installed or placed, or permitted to be
installed or placed, any underground storage tanks at or on the Premises.
Underground storage tanks shall have the definition as set forth in
N.J.S.A. 58:10A-22(p).
(f) Except as previously provided to Mortgagee, Mortgagor has not
received a summons, citation, directive, letter, other written
communication, or, to the best of its knowledge, any oral communication
("Communication"), and in any event, no such Communication remains
outstanding, from the New Jersey Department of Environmental Protection or
from any other person, firm or corporation concerning any intentional or
unintentional action or omission on Mortgagor's part resulting in the
releasing, spilling, leaking, pumping, pouring, emitting, emptying or
dumping of "Hazardous Substances", as such term is defined in N.J.S.A.
58:10-23.llb(k), into the waters or onto the lands of the State of New
Jersey, or into the waters outside the jurisdiction of the State of New
Jersey, in either case resulting in damage to the lands, waters, fish,
shellfish, wildlife, biota, air and other resources owned, managed, held in
trust or otherwise controlled by the State of New Jersey.
(g) In connection with any purchase of the Premises or any business or
assets located thereon or any closing, terminating or transferring of
ownership or operations of any "industrial establishment", as that term is
defined in ISRA or in the predecessor statute to ISRA, occurring on or
after December 31, 1983, Mortgagor required that the owner and or operator
of the industrial
34
establishment comply with the provisions of ISRA or in the predecessor
statute and the owner and or operator did comply therewith.
(h) Upon the occurrence of an Event (as hereinafter defined),
Mortgagee shall have the right to have its consultants perform a
comprehensive environmental audit of the Premises. Such audit shall be
conducted by an environmental consultant chosen by Mortgagee and may
include a visual survey, a record review, an area reconnaissance assessing
the presence of hazardous or toxic waste or substances, PCBs or storage
tanks at the Premises, an asbestos survey of the Premises, which may
include random sampling of the improvements and air quality testing, and
such further site assessments as Mortgagee may reasonably require due to
the results obtained from the foregoing. Mortgagor grants Mortgagee, its
agents, consultants and contractors the right to enter the Premises as
reasonable or appropriate for the circumstances for the purposes of
performing such studies and the reasonable cost of such studies shall be
due and payable by Mortgagor to Mortgagee upon demand and shall be secured
by the Lien of this Mortgage. Mortgagee shall direct the environmental
consultant to use its best efforts not to hinder Mortgagor's or any
tenant's operations when conducting such audit, sampling or inspections.
For purposes of this paragraph, the term "Event" shall mean (i) the
occurrence of any Event of Default, (ii) the issuance of any summons,
citation, directive or similar written notice from the New Jersey
Department of Environmental Protection or from any other local, state or
federal entity or from any other person, firm or corporation concerning any
alleged material violation of any and all federal, state and local
environmental legislation, rules and regulations in effect as of the date
of this Mortgage and subsequent thereto or (iii) the initiation of any
legal action, suits or other legal or administrative proceedings relating
to or in connection with any alleged violation of any and all federal,
state and local environmental legislation, rules and regulations in effect
as of the date of this Mortgage and subsequent thereto. By undertaking any
of the measures identified in and pursuant to this subsection (h),
Mortgagee shall not be deemed to be exercising any control over the
operations of Mortgagor or the handling of any environmental matter or
hazardous wastes or substances of Mortgagor for purposes of incurring or
being subject to liability therefor.
(i) If a Lien shall be filed against the Premises by the New Jersey
Department of Environmental Protection, pursuant to and in accordance with
the provisions of N.J.S.A. 58:10-23.llf(f), as a result of the
35
Chief Executive of the New Jersey Spill Compensation Fund having expended
monies from said fund to pay for "Damages", as such term is defined in
N.J.S.A. 58:10-23.llg, and/or "Cleanup and Removal Costs", as such term is
defined in N.J.S.A. 58:10-23(b), arising from an intentional or
unintentional action or omission of Mortgagor resulting in the releasing,
spilling, pumping, pouring, emitting, emptying or dumping of "Hazardous
Substances", as such term is defined in N.J.S.A. 58:10-23.11(b)k into
waters of the State of New Jersey or onto lands from which it might flow or
drain into said waters, then, unless there is a good faith basis for
contesting such Lien and Mortgagor is so contesting such Lien in accordance
with Section 5.09, Mortgagor shall, within 30 days from the date that
Mortgagor is given notice that the Lien has been placed against the
Premises or within such shorter period of time if the State of New Jersey
has commenced steps to cause the Premises to be sold pursuant to the Lien,
either (i) pay the claim and remove the Lien from the Premises, or (ii)
furnish (A) a bond satisfactory to a title company selected by Mortgagee
(the "Title Insurer") in the amount of the claim out of which the Lien
arises, (B) to the Trustee, a cash deposit (which may be disbursed by the
Trustee in its sole discretion) in the amount of the claim out of which the
Lien arises, or (C) other security reasonably satisfactory to Mortgagee in
an amount sufficient to discharge the claim out of which the Lien arises.
(j) Mortgagor shall use its best efforts to cause compliance by all
lessees with all applicable Legal Requirements relating to environmental
protection.
(k) Mortgagor shall promptly provide Mortgagee with copies of all
notices which allege or identify any actual or potential violation or
noncompliance received by or prepared by or for Mortgagor in connection
with ISRA, CERCLA, the Spill Act, RCRA or any other environmental law, rule
or regulation relating to the Premises. For purposes of this paragraph, the
term "notice" shall mean any summons, citation, directive, order, claim,
pleading, letter, application, filing, report, findings, declarations or
other materials pertinent to compliance of the Trust Estate and Mortgagor
with such environmental laws, rules or regulations.
(l) If this Mortgage is foreclosed, Mortgagor shall deliver the
Premises in compliance with all applicable federal, state and local
environmental laws, ordinances, rules and regulations, including, without
limitation, ISRA.
36
(m) Without limiting the generality of Section 5.22, Mortgagor agrees
to defend, indemnify and save Mortgagee harmless from and against any loss
or liability, cost or expense (including, without limitation, reasonable
attorneys' fees, consultants' fees, disbursements and court costs) arising
out of, or incurred in connection with, Mortgagor's misrepresentation, or
failure promptly (but in no event to exceed the time period permitted by
law) to comply with and perform its obligations, under this Section 5.04.
The provisions of this subsection (m) shall survive any transfer of the
Premises, including a transfer after a foreclosure of this Mortgage.
Section 5.05. Pari Passu Liens.
Any Liens permitted by the terms of the Trust Indenture and the Collateral
Agency Agreement to be on a parity with the Lien of this Mortgage may be on a
parity with the Lien of this Mortgage only if such Lien and the Indebtedness, if
any, secured thereby shall in all respects be in accordance with the provisions
of the Collateral Agency Agreement and the Trust Indenture.
Section 5.06. Warranty of Leasehold Estate and Title.
Mortgagor represents and warrants that as of the date hereof:
(a) Mortgagor is duly authorized under the laws of the State of New
Jersey and all other applicable laws to execute and deliver the Mortgage
Documents, and all corporate and partnership action on Mortgagor's part
necessary for the valid execution and delivery of the Mortgage Documents
has been duly and effectively taken;
(b) Mortgagor is the lawful owner and is lawfully seized and possessed
of the Owned Land and all buildings and improvements thereon, free and
clear of all Liens, charges or encumbrances, other than the Mortgage
Documents and the Existing Encumbrances;
(c) Mortgagor is the holder of and has good and marketable title to
the leasehold interests and leasehold estates under all existing Facility
Leases, subject to no Lien, encumbrance or charge other than the Mortgage
Documents and the Existing Encumbrances;
(d) (i) each existing Facility Lease is a valid and subsisting demise
of the respective Leased Land for the term therein set forth, and without
limiting the generality of the foregoing, all conditions to the
effectiveness of the Ground Leases have been either waived or
37
satisfied, (ii) there are no defaults under any Facility Lease by any
lessor or the lessee as to which written notice has been given to or by the
lessee, (iii) Mortgagor has delivered to Mortgagee a true and correct copy
of each existing Facility Lease, and all modifications, amendments and
supplements thereto, and (iv) each existing Facility Lease is in full force
and effect and has not been modified, amended or supplemented, except as
described on Schedule 2;
(e) Mortgagor has good title to the Operating Assets, subject to no
Lien, encumbrance or charge, other than the Mortgage Documents and the
Existing Encumbrances;
(f) Mortgagor has good and lawful right and authority to execute this
Mortgage and to grant, bargain, sell, alien, convey, assign, transfer,
hypothecate, pledge, mortgage and confirm the Trust Estate as provided
herein (including, without limitation, with respect to the Operating Assets
and Facility Leases), without the consent of any third party, other than
governmental authorities and other secured Persons but any applicable or
necessary consent or approval of any such governmental authority and other
such Persons has been given or waived in accordance with applicable law at
or prior to the execution and delivery of this Mortgage, and upon the
proper recording and indexing hereof, this Mortgage constitutes a valid
first mortgage Lien and first priority security interest in the Trust
Estate, subject only to Existing Encumbrances.
Mortgagor hereby does and shall forever warrant and defend (a) the title to
the Trust Estate (including, without limitation, Mortgagor's leasehold estate
under, and the lessee's interests in, each existing Facility Lease) (subject to
Permitted Liens) and (b) the priority of the Lien of the Mortgage Documents
thereon (subject to Permitted Liens other than Restricted Encumbrances), against
the claims and demands of all persons whomsoever, at Mortgagor's sole cost and
expense. No title company may rely on any of the foregoing representations or
warranties or make any claim in connection therewith by way of subrogation or
otherwise.
Section 5.07. After-Acquired Property; Further
Assurances; Recording.
All property, real, personal or mixed or any interest therein (other than
Excepted Property), of every kind and description and wheresoever situate, which
may be hereafter acquired by Mortgagor, the Company or any of its Subsidiaries
(including, without limitation, fee
38
title to any Leased Land) which shall be used or materially useful in connection
with the Trust Estate or any part thereof or shall otherwise materially relate
to the operation of the Casino Hotel or which shall be acquired by Mortgagor or
the Company or any of its Subsidiaries from proceeds due to an Event of Loss
with respect to the Premises in accordance with the provisions of Section 5.15
of the Trust Indenture, shall immediately upon the acquisition thereof by
Mortgagor, the Company or any of its Subsidiaries, and without any further
mortgage, conveyance or assignment, become subject to the Lien of this Mortgage
as fully as though now owned by Mortgagor and covered by the Granting Clauses.
Nevertheless, Mortgagor, the Company or any of its Subsidiaries, as applicable,
shall do, execute, acknowledge and deliver all and every such further acts,
conveyances, mortgages, financing statements and assurances as Mortgagee shall
require for accomplishing the express purposes of this Mortgage and the Trust
Indenture.
Mortgagor shall, as provided in Section 5.13, from time to time subject to
the Lien of this Mortgage its right, title and interest under all Leases.
Mortgagor shall use reasonable efforts to insure that all Operating Assets
or any interest therein hereafter acquired by Mortgagor, the Company or any of
its Subsidiaries shall be assignable to Mortgagee, and to the extent such
assignment to Mortgagee requires the consent of any governmental authority or
any other Person, Mortgagor shall use all reasonable efforts to obtain such
consent or a waiver thereof.
Mortgagor, the Company or any of its Subsidiaries, as applicable, shall
cause this instrument (or other appropriate instruments) and all other
instruments of further assurance, including all financing statements and
continuation statements covering security interests in personal property, to be
promptly recorded, registered and filed, and at all times to be kept recorded,
registered and filed, and shall execute and file such financing statements and
cause to be issued and filed such continuation statements, all in such manner
and in such places as may be required by law or as requested by Mortgagee to
fully preserve and protect the rights of Mortgagee as a secured party under the
Uniform Commercial Code to all property comprising the Trust Estate (to the
extent a grant of a security interest therein is governed by the Uniform
Commercial Code) and to perfect, preserve and protect the Lien of this Mortgage
as a valid first, (other than with respect to Acquired Indebtedness permitted by
the terms of Section 5.11 of the Trust Indenture) mortgage Lien of record and a
valid first (other than
39
with respect to Acquired Indebtedness permitted by the terms of Section 5.11 of
the Trust Indenture) priority security interest on the Trust Estate subject to
Permitted Liens, other than Restricted Encumbrances.
Mortgagor shall pay all filing or recording fees, and all expenses incident
to the execution and delivery of this Mortgage, any financing statement or
continuation statement with respect to the personal property constituting part
of the Trust Estate, and any instrument of further assurance, and all federal,
state, county and municipal stamp taxes and other taxes, duties, imposts,
assessments and charges arising out of or in connection with the execution and
delivery of this Mortgage, any financing statement or continuation statement
with respect to the personal property constituting part of the Trust Estate or
any instrument of further assurance.
Mortgagor shall furnish to Mortgagee promptly after the acquisition
hereafter by Mortgagor, the Company or any of its Subsidiaries of any fee
interest or leasehold interest in real property (i) material to the operation of
Mortgagor, (ii) which is necessary for the normal operation of the Casino Hotel
in accordance with all Legal Requirements and all Permits or (iii) which shall
be acquired by Mortgagor or the Company or any of its Subsidiaries from proceeds
due to an Event of Loss with respect to the Premises in accordance with the
provisions of Section 5.15 of the Trust Indenture, (a) a mortgagee policy of
title insurance on the most recent form of American Land Title Association
standard loan policy, extended coverage, which policy shall (i) contain all such
endorsements and affirmative insurance, to the extent reasonably applicable and
available at the then standard published rates for the State of New Jersey (or
if there shall be no such published rates, at commercially reasonable premiums),
as is contained in the Original Policy and (ii) evidence that title to such real
property is subject to no Liens or encumbrances, other than Permitted Liens,
which would (A) render title unmarketable or (B) violate any other provision of
this Mortgage or the Trust Indenture, (b) an as-built survey meeting the
"Minimum Standard Detail Requirements for ALTA/ACSM Land Title Surveys",
certified within 60 days prior to the acquisition date by a surveyor licensed in
the State of New Jersey using the same form of certification as that contained
in the surveys of the Premises delivered to Mortgagee on the date of this
Mortgage and (c) an Officers' Certificate certifying that the mortgagee policy
of title insurance and survey delivered pursuant to clauses (a) and (b) comply,
respectively, with the provisions of such clauses (a) and (b).
40
Notwithstanding anything contained herein or in the Trust Indenture to the
contrary, neither Mortgagor, the Company nor any of its Subsidiaries may acquire
any property, real, personal or mixed or any interest therein (other than
Excepted Property), of every kind and description and wheresoever situate
(including, without limitation, fee title to any Leased Land), which shall be
used or materially useful in connection with the Trust Estate or any part
thereof or shall otherwise materially relate to the operation of the Casino
Hotel or which shall be acquired by Mortgagor or the Company or any of its
Subsidiaries from proceeds due to an Event of Loss with respect to the Premises
in accordance with the provisions of Section 5.15 of the Trust Indenture, unless
Mortgagor, the Company or any of its Subsidiaries, as applicable, shall comply
with the provisions of this Section 5.07.
Section 5.08. Payment of Taxes and Certain Claims;
Maintenance of Properties; Compliance
with Legal Requirements and Insurance
Requirements.
Mortgagor shall:
(a) subject to the provisions of Section 5.09, pay or cause to be paid
before the date on which any fine, penalty, interest or cost may be added
for nonpayment (but no later than when the same are payable by Mortgagor
pursuant to any Superior Instrument Requirement), all taxes (including,
without limitation, real estate taxes, personal or other property taxes and
all sales, value added, use and similar taxes), assessments (including,
without limitation, all assessments for public improvements or benefits,
whether or not commenced or completed prior to the date hereof and whether
or not to be completed prior to the satisfaction of this Mortgage), water,
sewer or other rents, rates and charges, excises, levies, license fees,
permit fees, inspection fees and other authorization fees and other
charges, in each case whether general or special, ordinary or
extraordinary, foreseen or unforeseen, of every character (including,
without limitation, all interest, additions to tax and penalties thereon),
that may be assessed, levied, confirmed or imposed on or in respect of or
be a Lien upon (i) the Trust Estate (including, without limitation, the
Leased Land) or any part thereof or any rent therefrom or any estate, right
or interest therein, or (ii) any acquisition, occupancy, use, leasing, or
possession of or activity conducted on the real property or any part
thereof included in the Trust Estate or any gross receipts thereof or of
the rent therefrom (all of the foregoing being referred to collectively as
"Impositions").
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Notwithstanding the foregoing or any other provision of this Mortgage or
the Trust Indenture, Mortgagor shall not be required to pay any income,
profits or revenue tax upon the income of Mortgagee or the Holders nor any
franchise, excise, corporate, estate, inheritance, succession, capital levy
or transfer tax of Mortgagee or the Holders nor any interest, additions to
tax or penalties in respect thereof, unless such tax is imposed, levied or
assessed in substitution for any Imposition that Mortgagor is required to
pay pursuant to this Section 5.08. Mortgagor shall deliver to Mortgagee, at
Mortgagee's request, official receipts or other proof evidencing payments
of any Impositions in accordance with the requirements of this Section
5.08. Mortgagor shall not be entitled to any credit for taxes or
assessments paid against the Mortgage Notes;
(b) except for such property which Mortgagor may dispose of or replace
pursuant to Section 2.02 and the terms of the Trust Indenture, maintain and
keep all of Mortgagor's properties used or useful in the conduct of
Mortgagor's business, including, without limitation, the Casino Hotel and
all Tangible Personal Property, in such good repair, working order and
condition, except for reasonable wear and use, and shall make or cause to
be made all such needful and proper repairs, renewals and replacements
thereto consistent with the standards of first-class casino and hotel
complexes in Atlantic City, New Jersey;
(c) occupy and continuously operate the Casino Hotel and keep the
Casino Hotel supplied with Tangible Personal Property, all in a manner
consistent with the standards of first-class casino and hotel complexes in
Atlantic City, New Jersey;
(d) subject to the provisions of Section 5.09, (i) comply with all
Legal Requirements and Insurance Requirements, whether or not compliance
therewith shall require structural changes in the buildings and
improvements included in the Trust Estate or interfere with the use and
enjoyment of the Trust Estate or any part thereof, (ii) procure, maintain
and comply with all Permits required for (1) the use of the Casino as a
gaming and gambling facility, (2) the on-premises consumption of alcoholic
beverages at the Casino Hotel and (3) any other use of the Trust Estate or
any part thereof then being made, and for the proper erection,
installation, operation and maintenance of the improvements or any part
thereof, (iii) comply with all obligations of Mortgagor under, and keep in
full force and effect, all easements which in any respect inure to the
benefit of, or otherwise affect, the Trust Estate or any part thereof, if
the
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failure to comply with the same would impair Mortgagee's security
hereunder, and (iv) without limiting the generality of clause (iii), comply
with any instruments of record at the time in force affecting the Trust
Estate or any part thereof, if the failure to comply with the same would
impair Mortgagee's security hereunder. Without limiting the generality of
the foregoing, Mortgagor represents and warrants that at the time of the
execution of this Mortgage, Mortgagor is in compliance with the
requirements of clauses (i), (ii), (iii) and (iv) above; and
(e) in the event of the passage after the date of this Mortgage of any
law of the State of New Jersey, or any other governmental entity, changing
in any way the laws now in force for the taxation of mortgages, or debts
secured thereby, for federal, state or local purposes, or the manner of the
operation of any such taxes, so as to affect the interest of Mortgagee, pay
the full amount of such new or additional taxes.
Section 5.09. Permitted Contests.
Notwithstanding anything in this Mortgage to the contrary, Mortgagor, at
Mortgagor's expense, may contest by appropriate legal proceedings conducted in
good faith and with due diligence, the amount or validity or application, in
whole or in part, of any Imposition or Lien therefor or any Legal Requirement or
Insurance Requirement or the application of any instrument of record (including,
without limitation, any Superior Instrument Requirement) affecting the Trust
Estate or any part thereof or any claims of holders of F,F&E Financing
Agreements, mechanics, materialmen, suppliers, or vendors or Lien therefor, and
may withhold payment of the same pending such proceedings if permitted by law,
or make payment under protest, or defer compliance with any such Legal
Requirement, any such Insurance Requirement or the terms of any such instrument,
and the same shall not be a Default hereunder; provided, that (a) in the case of
any Impositions or Lien therefor or any claims of mechanics, materialmen,
suppliers or vendors or Lien therefor, such proceedings shall suspend the
collection thereof from each of Mortgagor, Mortgagee, the Holders, the Secured
Beneficiaries and the Trust Estate, (b) neither the Trust Estate nor any
interest therein would be in any significant danger of being sold, forfeited, or
lost, (c) such action will not result in the termination of any Facility Lease,
(d) in the case of a Legal Requirement, neither the Secured Beneficiaries,
including, without limitation, the Holders, nor the Mortgagee shall be in any
significant danger of any civil liability or any danger of any criminal
liability, and the failure of Mortgagor to
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comply with such Legal Requirement shall not affect the continuance in good
standing of any Permit or result in the suspension, termination, non-renewal or
material adverse modification of any Permit, and (e) in the case of an Insurance
Requirement, the failure of Mortgagor to comply therewith shall not affect the
validity of any insurance required to be maintained by Mortgagor hereunder.
Section 5.10. Mechanics' and Other Liens.
Mortgagor shall cause to be removed, all statutory Liens of carriers,
warehousemen, mechanics, landlords, laborers, materialmen, repairmen or other
like Liens arising by operation of law in the ordinary course of business and
consistent with industry practices and Liens on deposits made to obtain the
release of such Liens if (i) the underlying obligations are overdue for a period
of more than 60 days or (ii) such Liens are not being contested in good faith
and by appropriate proceedings by the Company or any of its Subsidiaries and
adequate reserves with respect thereto are maintained on the books of the
Company or any of its Subsidiaries, as the case may be, in accordance with GAAP
and the provisions of Section 5.09 and in general shall do or cause to be done
everything necessary so that the Lien hereof shall be fully preserved, at the
cost of Mortgagor, without expense to Mortgagee.
Section 5.11. To Insure.
(a) Mortgagor, at Mortgagor's expense, shall maintain with Insurers:
(i) insurance with respect to Mortgagor's insurable properties
constituting a part of the Trust Estate against loss or damage by fire,
lightning, and other risks from time to time included under "all-risk"
policies and against loss or damage by sprinkler leakage, water damage,
collapse, malicious mischief and explosion in respect of any steam and
pressure boilers and similar apparatus located on such insurable
properties, in amounts at all times sufficient to prevent Mortgagor from
becoming a coinsurer within the terms of the applicable policies, but in
any event such insurance shall be maintained in not less than the greatest
of the following (the "Insurance Amount"): (A) 100% of the then Full
Insurable Value of such insurable properties, determined from time to time
(but not less frequently than once in any 36 calendar months), by an
Independent appraiser or Insurer, (B) the then outstanding principal amount
of Indebtedness under
44
the Debt Documents or (C) the amount required to be maintained pursuant to
the Material Instrument Requirements;
(ii) war risk insurance as and when such insurance is obtainable from
the United States of America or any agency thereof as promptly as
reasonably practicable after the same becomes so obtainable, in an amount
not less than the Insurance Amount, or, if such insurance cannot be
obtained in an amount not less than the Insurance Amount, in such lesser
amount as may then be so obtainable;
(iii) comprehensive general liability insurance, including, without
limitation, blanket contractual liability coverage, broad form property
damage, independent contractor's coverage and personal injury coverage
against any and all claims arising out of or connected with the possession,
use,, leasing, operation or condition of such insurable properties, in an
amount not less than $100,000,000 combined single limit coverage for
personal injury and property damage with respect to any one occurrence,
which may be under an umbrella policy. Anything contained in this clause
(iii) to the contrary notwithstanding, the Material Instrument Requirements
with respect to the kinds and amount of insurance described in this clause
(iii) shall be satisfied by Mortgagor;
(iv) workers' compensation insurance to the extent required by law;
(v) business interruption insurance covering not less than 6 months of
loss;
(vi) to the extent available for a commercially reasonable premium,
flood insurance in an amount not less than the Insurance Amount, or, if
such insurance cannot be obtained in an amount not less than the Insurance
Amount, such lesser amount as may then be so obtainable but in no event
less than $100,000,000; and
(vii) such other insurance with respect to such insurable properties
against loss or damage of the kinds (A) from time to time customarily
insured against by persons owning or using first-class casino and hotel
complexes in Atlantic City, New Jersey and (B) required to be maintained
pursuant to any Material Instrument Requirements.
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Notwithstanding the foregoing, to the extent not violative of any Material
Instrument Requirements, Mortgagor may maintain deductibles with respect to the
insurance policies described in clauses (i), (ii), (iii), (v), (vi) and (vii)
above in accordance with standard industry practice with respect to the
operation of a first-class casino hotel.
(b) (i) Each policy of insurance maintained by Mortgagor pursuant to
Section 5.11(a) shall, (A) except in the case of workers' compensation
insurance, name Mortgagor as an insured and shall name as additional insureds
(1) Mortgagee and (2) to the extent required by the Material Instrument
Requirements, the lessors under any Facility Leases, (B) provide that all
insurance proceeds for losses, except in the case of comprehensive general
liability insurance and workers' compensation insurance, be payable solely to
Mortgagee, subject to any Material Instrument Requirements, include effective
waivers (whether under the terms of any such policy or otherwise) by the insurer
of all claims for insurance premiums against all loss payees and named insureds
(other than Mortgagor) and all rights of subrogation against any named insured,
(D) except in the case of comprehensive general liability and workers'
compensation insurance, provide that any losses shall be payable notwithstanding
(1) any act, failure to act, negligence of, or violation or breach of
warranties, declarations or conditions contained in such policy by Mortgagor or
Mortgagee or any other named insured or loss payee, (2) the occupation or use of
the insurable properties for purposes more hazardous than permitted by the terms
of the policy, (3) any foreclosure or other proceeding or notice of sale
relating to the insurable properties or (4) any change in the title to or owners
hip or possession of the insurable properties, (E) contain a non-contributory
mortgagee clause in favor of Mortgagee, and (F) provide that if all or any part
of such policy is cancelled, terminated or expires, the insurer will forthwith
give notice thereof to each named insured and loss payee and that no
cancellation, non-renewal, reduction in amount or material change in coverage
thereof shall be effective until at least 30 days after receipt by each named
insured and loss payee of written notice thereof. Mortgagor may effect the
insurance required under this Section 5.11 under blanket and/or umbrella
policies covering properties owned or leased by Affiliates of Mortgagor;
provided, that such policies otherwise comply with this Mortgage and provide
that the amount of coverage afforded thereunder with respect to the Trust Estate
shall not be reduced by claims thereunder against such other properties.
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(ii) Mortgagor may effect the insurance required under this Section 5.11
under blanket and/or umbrella policies covering properties owned or leased by
Affiliates of Mortgagor; provided, that (A) such policies otherwise comply with
this Mortgage, (B) except with respect to flood insurance and earthquake
insurance, provide that the amount of coverage afforded thereunder with respect
to the Trust Estate shall not be reduced by claims thereunder against such other
properties' and (C) in the case of flood insurance provide that the amount of
coverage afforded thereunder with respect to the Trust Estate shall not be
reduced below $100,000,000 by reason of claims thereunder against such other
properties.
(c) Mortgagee shall not be responsible for effecting or renewing any
insurance or for the responsibility or solvency of the insurers.
(d) Mortgagor shall not take out separate insurance, concurrent in form or
contributing in the event of loss with that required to be maintained pursuant
to this Section 5.11, unless the same is permitted by Material Instrument
Requirements.
Section 5.12. Limitations on Building Demolition,
Alterations, Improvements and New
Construction.
Unless an Event of Default shall have occurred and be continuing, Mortgagor
shall have the right at all times to make or permit such demolition,
alterations, improvements or new construction, structural or otherwise (herein
sometimes called collectively "Alterations" and each, individually, an
"Alteration"), of or on the Trust Estate, to be made in all cases subject to
each of the following conditions:
(a) No Alteration shall be undertaken or carried out except in
conformity with all Material Instrument Requirements, Legal Requirements
and Insurance Requirements.
(b) If any Alteration, together with other Alterations that constitute
a single construction plan or project (whether or not accomplished in
several stages or procedures) is material to the Premises taken as a whole
(a "Material Alteration"), the building or buildings, structures or other
improvements as so improved or altered, upon the completion of the work,
shall be of a value not less than the value of such building or buildings,
structures or other improvements immediately prior to the making of such
Material Alteration.
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(c) Any Material Alteration shall be conducted under the supervision
of an Architect, and upon Mortgagee's request therefor, detailed plans and
specifications and cost estimates therefor, prepared and approved in
writing by such Architect and accompanied by a certificate of such
Architect stating that such plans and specifications are in compliance with
all Legal Requirements and Insurance Requirements shall be delivered to
Mortgagee.
(d) No Alteration which is material to the operation of the Company
and its Subsidiaries taken as a whole shall be undertaken until Mortgagor
has furnished to Mortgagee, at Mortgagor's sole cost and expense, a surety
bond or bonds, covering performance, and labor and material payments with
respect to the work to be so performed, naming Mortgagee as obligee, issued
by a responsible surety company, authorized to do business in the State of
New Jersey, in a form generally and customarily used by such surety in an
amount equal to the estimated cost of construction of the work covered by
the plans and specifications therefor, guaranteeing the performance and
completion of such construction, substantially in conformity with the said
plans and specifications and within a reasonable time, subject to delays by
fire, strikes, lock-out, acts of God, inability to obtain labor or
materials, governmental restrictions, enemy action, civil commotion or
unavoidable Casualty or other similar causes beyond the control of
Mortgagor, free and clear of all Liens, claims and liabilities for the cost
of such Alterations. If such surety bond or bonds shall be unobtainable
Mortgagor shall deliver to Mortgagee security by cash, letter of credit or
other guarantee, affording substantially the same protection as would such
bond or bonds. If Mortgagor shall require any contractor performing a
Material Alteration to deliver any surety bonds or bonds, covering
performance, and labor and material payments with respect to the work to be
so performed, naming Mortgagor as obligee, such bond or bonds shall name
Mortgagee as co-obligee.
(e) All work done in connection with any Alterations shall be done
promptly and in good and workmanlike manner. The work in connection with
any Alteration shall be prosecuted with reasonable dispatch, delays due to
fire, strikes, lock-outs, acts of God, inability to obtain labor or
materials, governmental restrictions, enemy action, civil commotion or
unavoidable Casualty or similar causes beyond the control of Mortgagor
excepted.
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(f) No Alterations of any kind shall be made which shall change the
use of the Casino Hotel from its use as a gaming and hotel facility.
(g) Mortgagor shall maintain, or shall require its contractors to
maintain, at all times during the performance of Material Alterations, in
addition to any insurance required to be maintained under Section 5.11
hereof, appropriate workers' compensation insurance covering all persons
employed for such Material Alterations to the extent required by applicable
law, and comprehensive general liability insurance expressly covering the
additional hazards due to such Material Alterations. Each such policy of
insurance shall comply with the provisions of Section 5.11(b), and
Mortgagor shall comply with Subsections (c), (d) and (e) of Section 5.11 in
connection with all such insurance.
Section 13. Leases.
Mortgagor shall not (except in accordance with the provisions of the
Trust Indenture):
(a) lease the Trust Estate substantially as an entirety to any Person,
nor shall Mortgagor lease either the Casino Hotel or the Casino or the
Hotel or any parking facilities located on the Parking Parcel or the
Parking Parcel substantially as an entirety to any Person;
(b) enter into any Lease, or renew, modify, extend, terminate, or
amend any Lease, except in the ordinary course of business of operating the
Casino Hotel;
(c) receive or collect, or permit the receipt or collection of, any
rental payments under any Lease more than one month in advance of the
respective periods in respect of which they are to accrue, except that, in
connection with the execution and delivery of any Lease or of any amendment
to any Lease, rental payments thereunder may be collected and received in
advance in an amount not in excess of three months' rent and/or a security
deposit may be required thereunder;
(d) collaterally assign, transfer or hypothecate (other than to
Mortgagee hereunder and except as permitted by the Trust Indenture) (i) any
rental payment under any Lease whether then due or to accrue in the future,
(ii) the interest of Mortgagor as landlord under any Lease or (iii) the
rents, issues or profits of the Trust Estate;
49
(e) after the date hereof, enter into any Lease, or renew any Lease,
unless such Lease contains terms to the effect as follows:
(i) the Lease and the rights of the tenants thereunder shall be
subject and subordinate to the rights of Mortgagee under this
Mortgage,
(ii) the Lease may be assigned by the landlord thereunder to
Mortgagee,
(iii) the rights and remedies of the tenant in respect of any
obligations of the landlord thereunder shall be nonrecourse as to any
assets of the landlord other than its equity in the building in which
the leased premises are located or the proceeds thereof, and
(iv) the rights of the tenant shall be subject and subordinate to
the rights of the lessee under any new Lease permitted by the terms of
the Ground Leases); or
(f) modify any Lease with respect to the matters described in clauses
(i) through (iv) of paragraph (e).
If Mortgagor enters into a Lease (other than with Affiliate of Mortgagor)
for a term of not less than 3 years, Mortgagee shall deliver a non-disturbance
and attornment agreement substantially in the form of Schedule 5 hereto,
following receipt of a Mortgagor's Request. Mortgagor shall, upon demand,
reimburse Mortgagee for any costs and expenses (including reasonable attorneys'
fees and disbursements) incurred by Mortgagee in connection with the
preparation, review and delivery of such non-disturbance and attornment
agreements. Mortgagee shall, from time to time, after receipt of a Mortgagor
Request therefor (accompanied by an Officers' Certificate stating that said
conditions have been satisfied) execute instruments in form and substance
reasonably satisfactory to Mortgagee confirming the permissibility of a
modification, termination or surrender of any Lease, other than a modification
described in paragraph (f) of this Section 5.13.
Promptly after the execution and delivery hereof, Mortgagor shall cause the
lessee under each Lease now in effect, and promptly after each Lease is executed
or becomes effective after the date of the execution and delivery hereof,
Mortgagor shall cause the lessee under each such Lease, to be duly notified in
writing (unless the substance and effect of such notice shall be contained
50
in such Lease) of the subjection of the owner's interest, as lessor, in and to
such Lease to the Lien of this Mortgage and of the name and address of
Mortgagee. Each such notice shall state that the lease of such lessee is a Lease
as herein defined. If a new Mortgagee is at any time appointed hereunder or the
address of Mortgagee shall at any time be changed, Mortgagor shall cause each
lessee under each Lease to be promptly notified in writing of the name and
address of such new Mortgagee or the new address of Mortgagee. Mortgagor shall
use reasonable efforts (but shall not be obligated to incur any expenditure
other than de minimis amounts) to obtain from each lessee under each Lease to
whom any notice is sent pursuant to this paragraph an acknowledgment of receipt
of such notice, and Mortgagor shall promptly deliver to Mortgagee, upon request,
a copy of each such acknowledgment of receipt which it is able to obtain.
Mortgagee shall not be responsible for securing or causing Mortgagor to secure
any such acknowledgment.
Section 5.14. Compliance Certificates.
Mortgagor shall comply with the provisions of Section 5.7 of the Trust
Indenture, the terms of which are incorporated herein by reference.
Section 5.15. Intentionally Omitted.
Section 5.16. To Keep Books; Inspection by Mortgagee.
Mortgagor will keep proper books of record and account, in which full and
correct entries shall be made of all dealings or transactions of or in relation
to the properties, business and affairs of Mortgagor in accordance with
generally accepted accounting principles consistently applied. Said books shall
be maintained in an office located either in Atlantic City, New Jersey or in the
Borough of Manhattan, City of New York, State of New York. Mortgagor shall at
any and all times, upon request of Mortgagee and at the expense of Mortgagor,
permit Mortgagee and its representatives to inspect the Casino Hotel and any
other buildings, structures and improvements now or hereafter located on the
Land and the books of account, records, reports and other papers of Mortgagor,
and to make copies and extracts therefrom, and will afford and procure a
reasonable opportunity to make any such inspection (provided, that any such
inspection shall not unreasonably interfere with the business operations of
Mortgagor), and Mortgagor will furnish to Mortgagee any and all information as
Mortgagee may reasonably request, with respect to the performance by Mortgagor
of its covenants in this Mortgage.
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Section 5.17. Advances by Mortgagee.
If Mortgagor shall fail to perform any of the covenants, terms, provisions
or conditions contained in this Mortgage and such failure shall continue for 10
days following notice thereof given by Mortgagee (or at any time, without
notice, in case of emergency), Mortgagee may (but is not obligated to), at any
time and from time to time, take any action or make advances, to effect
performance of any such covenant, term, provision or condition on behalf of
Mortgagor; and all moneys so used, paid or advanced by Mortgagee and all
reasonable costs and expenses incurred by Mortgagee in connection therewith,
together with interest on all of the same at the rate of interest set forth in
the applicable Debt Documents, shall be immediately due and payable by Mortgagor
to Mortgagee and all such moneys, costs and expenses shall be secured by the
Lien of this Mortgage prior to any Indebtedness secured hereby. No such advance
or payment by Mortgagee shall relieve Mortgagor from any default hereunder or
impair any right or remedy of Mortgagee.
Section 5.18. Waiver of Stay, Extension or Usury Laws.
Mortgagor covenants (to the extent that it may lawfully do so) that it will
not at any time insist upon, or plead, or in any manner whatsoever claim or take
the benefit or advantage of, any usury, stay or extension law or any other law
wherever enacted which would prohibit or forgive Mortgagor from paying all or
any portion of the Obligations secured by this Mortgage, wherever enacted, now
or at any time hereafter in force, or which may otherwise affect the covenants
or the performance of this Mortgage; and Mortgagor (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it shall not hinder, delay or impede the execution of
any power herein granted to Mortgagee, but shall suffer and permit the execution
of every such power as though no such law had been enacted.
Section 5.19. Intentionally Omitted.
Section 5.20. Facility Leases.
(a) Subject to the provisions of Sections 4.3 and 5.15 of the Trust
Indenture, Mortgagor shall do or cause to be done all things necessary to
preserve and keep unimpaired the rights of Mortgagor, as lessee under all
Facility Leases, and to prevent any termination, surrender, cancellation,
forfeiture or impairment of any thereof, except to the extent that the
underlying fee
52
estate thereof has been mortgaged to Mortgagee as of the date hereof. Mortgagor
shall at all times fully perform and comply with all agreements, covenants,
terms and conditions imposed upon or assumed by it as lessee under each of the
Facility Leases (including, without limitation, the covenant to pay rent and all
taxes, assessments and other charges mentioned therein) prior to the expiration
of any notice and/or cure period provided in each such Facility Lease. Upon
receipt by Mortgagee from a Lessor of any written notice of default by the
lessee thereunder, Mortgagee may rely thereon and take any action Mortgagee
deems necessary in its sole discretion to prevent or to cure any default by
Mortgagor in the performance of or compliance with any of the agreements,
covenants, terms or conditions imposed upon or assumed by Mortgagor as lessee
under such Facility Lease, even though the existence of such default or the
nature thereof be questioned or denied by Mortgagor or by any party on behalf of
Mortgagor. Without limiting the generality of Section 3.09, Mortgagor hereby
expressly grants to Mortgagee, and agrees that Mortgagee shall have, the
absolute and immediate right to enter in and upon the Premises or any part
thereof to such extent and as often as Mortgagee, in its sole discretion, deems
necessary or desirable for the purpose permitted by the immediately preceding
sentence, subject only to applicable Legal Requirements. Without limiting
Mortgagor's obligations or Mortgagee's rights set forth above or limiting
Mortgagee's other remedies under this Mortgage, Mortgagee may pay and expend
such sums of money as Mortgagee in its sole discretion deems necessary for any
such purpose, and Mortgagor hereby agrees to pay to Mortgagee immediately and
without demand, all such sums, so paid and expended by Mortgagee, together with
interest thereon from the date of each such payment at the highest rate of
interest set forth in the Mortgage Notes. All sums so paid and expended by
Mortgagee, and the interest thereon, shall be added to and be secured by the
Lien of this Mortgage.
(b) Subject to the provisions of Sections 4.3 and 5.15 of the Trust
Indenture, Mortgagor further covenants and agrees as follows:
(i) Mortgagor shall not without the consent of Mortgagee, surrender,
terminate or cancel modify, change, supplement, alter or amend any Facility
Lease, either orally or in writing, if an impairment of the security
granted under this Mortgage would result therefrom. As further security for
the repayment of the indebtedness secured hereby and for the performance of
the covenants herein and in each Facility Lease contained, Mortgagor hereby
assigns to Mortgagee all of Mortgagor's rights,
53
privileges and prerogatives as lessee under each Facility Lease to
terminate, cancel, modify, change, supplement, alter or amend such Facility
Lease, and any such termination, cancellation, modification, change,
supplement, alteration or amendment of a Facility Lease in violation of the
terms hereof, without the prior consent thereto by Mortgagee, shall be void
and of no force and effect. Unless (1) an Event of Default has occurred and
is continuing and (2) either (A) there has been an acceleration of maturity
of any Indebtedness secured hereby or (B) Mortgagee exercises its rights
under Section 3.09, Mortgagee shall have no right to terminate, cancel,
modify, change, supplement, alter or amend any Facility Lease. Mortgagee
shall, from time to time, after receipt of a Mortgagor Request therefor
(accompanied by an Officers' Certificate stating that said conditions have
been satisfied) execute instruments in form and substance reasonably
satisfactory to Mortgagee confirming the permissibility of the modification
of any Facility Lease described in this clause (i).
(ii) Solely for the benefit of Mortgagee, the Holders and no other
person, no release or forbearance of any of Mortgagor's obligations under
any Facility Lease, pursuant to such Facility Lease or otherwise, shall
release Mortgagor from any of Mortgagor's other obligations under this
Mortgage.
(iii) Unless Mortgagee shall otherwise expressly consent in writing,
the fee title to the Leased Facilities and Mortgagor's leasehold estates
therein shall not merge and shall always remain separate and distinct,
notwithstanding the union of said estates either in the Lessor or in the
lessee, or in a third party by purchase or otherwise.
(iv) Mortgagor shall not appoint or consent to the appointment of an
arbitrator pursuant to the terms of the Ground Leases without the prior
consent of Mortgagee. Mortgagor shall promptly notify Mortgagee in writing
of any request made by Mortgagor, as lessee under any Facility Lease, or
any of the Lessors, for arbitration proceedings under any Facility Lease
and of the institution of any arbitration proceedings, as well as all
proceedings thereunder. Mortgagor shall promptly deliver to Mortgagee a
copy of the determination of the arbitrators in each such arbitration
proceeding. Mortgagee shall have the right to participate in such
arbitration proceedings in association with
54
Mortgagor or on its own behalf as an interested party.
(v) Mortgagor shall not consent to the subordination of any Facility
Lease to any mortgage, deed of trust or other Lien on the fee interest of
the Lessor.
(vi) If (A) Mortgagor exercises its option(s) under the terms of any
Ground Lease to purchase any portion of the Ground Lease Land, Mortgagor
shall deliver a copy of its election to exercise such option within 5 days
after Mortgagor has delivered notice of such election to the Lessor or (B)
Mortgagor acquires fee simple title or any other estate, title or interest
in any Leased Facility (pursuant to the options described in clause (A) or
otherwise), Mortgagor shall promptly notify Mortgagee of such acquisition
and, on request by Mortgagee, shall cause to be executed and recorded all
such other and further assurances or other instruments in writing as may in
the opinion of Mortgagee be required or desirable to carry out the intent
and meaning of clause (x) of Granting Clause Second.
(vii) Within 5 days after Mortgagor's receipt of any notice of any
motion, application or effort to reject any Facility Lease by any Lessor or
any trustee arising from or in connection with any case, proceeding or
other action commenced or pending by or against any Lessor under the Code
or any comparable provision contained in any present or future federal,
state, local, foreign or other statute, law, rule or regulation
("Comparable Provision"), Mortgagor shall give notice thereof to Mortgagee.
Mortgagor hereby (A) assigns to Mortgagee any and all of Mortgagor's rights
as lessee under Section 365(h) of the Code or any Comparable Provision and
(B) covenants that it shall not elect to treat any Facility Lease as
terminated pursuant to Section 365(h) of the Code or any Comparable
Provision without the prior consent of Mortgagee and (C) agrees that any
such election by Mortgagor without such consent shall be null and void.
(viii) Without limiting the generality of the foregoing, to the extent
permitted by applicable law, Mortgagor hereby unconditionally assigns,
transfers and sets over to Mortgagee all of Mortgagor's claims and rights
to the payment of damages arising from any rejection by Lessor of any
Facility Lease under the Code or any Comparable Provision. Mortgagee shall
have the right to proceed
55
in its own name or in the name of Mortgagor in respect of any claim, suit,
action or proceeding relating to the rejection of any Facility Lease,
including, without limitation, the right to file and prosecute, in
cooperation with Mortgagor, any proofs of claim, complaints, motions,
applications, notices and other documents, in any case in respect of Lessor
under the Code or any Comparable Provision. This assignment constitutes a
present, irrevocable and unconditional assignment of the foregoing claims,
rights and remedies, and shall continue in effect until all of the
indebtedness and obligations secured by this Mortgage shall have been
satisfied and discharged in full. Any amounts received by Mortgagee in
damages arising out of the rejection of any Facility Lease as aforesaid
shall be applied first to all reasonable costs and expenses of Mortgagee
(including, without limitation, reasonable attorneys' fees, disbursements
and court costs) incurred in connection with the exercise of any of its
rights or remedies under this Section 5.20, and thereafter as provided in
Section 3.03.
(ix) If there shall be filed by or against Mortgagor a petition under
the Code or any Comparable Provision and Mortgagor, as lessee under any
Facility Lease, shall determine to reject such Facility Lease, Mortgagor
shall give Mortgagee not less than 10 days' prior notice of the date on
which Mortgagor shall apply to the Bankruptcy Court or other judicial body
with appropriate jurisdiction for authority to reject such Facility Lease.
Mortgagee shall have the right, but not the obligation, to serve upon
Mortgagor within such 10-day period a notice stating that (a) Mortgagee
demands that Mortgagor assume and assign such Facility Lease to Mortgagee
pursuant to Section 365 of the Code or any Comparable Provision and (b)
Mortgagee covenants to cure or provide adequate assurance of prompt cure of
all defaults and provide adequate assurance of future performance under
such Facility Lease. If Mortgagee serves upon Mortgagor the notice
described in the preceding sentence, Mortgagor shall not seek to reject
such Facility Lease and shall comply with the demand provided for in clause
(a) of the preceding sentence within 30 days after the notice shall have
been given subject to the performance by Mortgagee of the covenant provided
for in clause (b) of the preceding sentence. The foregoing provisions of
this Section 5.20(x) shall not apply to the extent not permitted by
applicable law. Effective upon the entry of an order for relief in respect
of Mortgagor under Chapter 7 of the Code or any Comparable Provision,
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Mortgagor hereby assigns and transfers to Mortgagee a non-exclusive right
to apply to the Bankruptcy Court or other judicial body with appropriate
jurisdiction for an order extending the period during which such Facility
Lease may be rejected or assumed.
(x) Mortgagor shall promptly give to Mortgagee copies of (A) all
notices of default and (B) any other communications or notices with respect
to events that relate to the possible impairment of the security of this
Mortgage, which Mortgagor shall give or receive under any Facility Lease
and shall promptly notify Mortgagee of any default under any Facility Lease
on the part of the Lessor or Mortgagor.
(xi) Mortgagor shall enforce with due diligence all of the obligations
of the Lessor under each Facility Lease, to the end that Mortgagor may
enjoy all of the rights and privileges granted to it under the Facility
Leases.
(xii) Mortgagor shall notify Mortgagee within 5 days after the
transfer of a fee interest in any Leased Facility or any portion thereof to
or from an Affiliate.
(xiii) The Company or any of its Subsidiaries shall not at any time
hereafter acquire fee title to the Leased Land or any portion thereof
unless simultaneously with such acquisition the Company or such Subsidiary
and Mortgagor execute and exchange (and deliver to Mortgagee an executed
counterpart of) an instrument in form and substance satisfactory to
Mortgagee providing that so long as the Company or such Subsidiary owns
such fee title (A) the Company or such Subsidiary shall not terminate the
applicable Facility Lease for any reason whatsoever (including, without
limitation, due to the default of Mortgagor under such Facility Lease) and
(B) the Company or such Subsidiary shall not accept, and, if tendered by
Mortgagor shall promptly return to Mortgagor, any payment of rent or other
charges payable under such Facility Lease in excess of the amount required
to pay the debt service and other sums payable under any mortgage affecting
the Company's or such Subsidiary's fee interest in the applicable Leased
Facility (and the Company or such Subsidiary shall use such funds only to
pay its debt service obligations and other sums payable under such
mortgage) at any time that an Event of Default
57
shall have occurred and be continuing under this Mortgage or the Trust
Indenture.
(c) Mortgagor hereby represents and warrants that all fixed rent (as
defined in the Ground Leases), taxes and assessments, payable under the Ground
Leases have been paid to the extent they were due and payable to the date hereof
and that Mortgagor has not received notice of its failure to pay any other
amounts payable under the Ground Leases which has not been cured.
(d) Subject to the provisions of Section 5.20(b)(iii), if both the lessor's
and lessee's estates under any Facility Lease or any portion thereof shall at
any time become vested in one owner, this Mortgage and the Lien created hereby
shall nevertheless not be destroyed or terminated by application of the doctrine
of merger and, in such event, Mortgagee shall continue to have all of the rights
and privileges of a first leasehold mortgagee.
(e) Mortgagor hereby acknowledges that if any Facility Lease shall be
terminated prior to the natural expiration of its term due to default by the
lessee thereunder, and if pursuant to such Facility Lease, Mortgagee or its
designee shall acquire from the Lessor a new lease of the Leased Facility or any
portion thereof, Mortgagor shall have no right, title or interest in or to such
lease or the leasehold estate created thereby, or the options therein contained.
(f) Each Facility Lease hereafter entered into or assumed by Mortgagor as
lessee or sublessee shall contain provisions (i) permitting the assignment of
the same to Mortgagee and permitting assignment without the lessor's consent if
this Mortgage is foreclosed; and (ii) providing protection to Mortgagee, as
leasehold mortgagee, not less favorable than the provisions contained in the
Ground Leases.
Section 5.21. Intentionally Omitted.
Section 5.22. Indemnification.
Mortgagor shall reimburse Mortgagee upon request for all reasonable
disbursements, expenses and advances incurred or made by it in accordance with
the terms hereof. Such expenses shall include the reasonable compensation,
disbursements and expenses of Mortgagee's agents, accountants, experts and
counsel.
Mortgagor shall indemnify Mortgagee (in its capacity as Mortgagee) and each
of its officers, directors,
58
attorneys-in-fact and agents for, and hold it harmless against, any claim,
demand, expense (including but not limited to reasonable compensation,
disbursements and expenses of Mortgagee's agents and counsel), loss or liability
incurred by them without negligence, bad faith or willful misconduct on its
part, arising out of or in connection with the administration of this Mortgage
and their rights or duties hereunder including the reasonable costs and expenses
of defending themselves against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. Mortgagee
shall notify Mortgagor promptly of any claim asserted against the Mortgagee for
which it may seek indemnity. Mortgagor shall defend the claim and Mortgagee
shall provide reasonable cooperation at Mortgagor's expense in the defense.
Mortgagee may have separate counsel and Mortgagor shall pay the reasonable fees
and expenses of such counsel; provided, that Mortgagor will not be required to
pay such fees and expenses if it assumes Mortgagee's defense and there is no
conflict of interest between Mortgagor and Mortgagee in connection with such
defense. Mortgagor need not pay for any settlement made without its written
consent. Mortgagor need not reimburse any expense or indemnify against any loss
or liability to the extent incurred by Mortgagee through its negligence, bad
faith or willful misconduct.
When Mortgagee incurs expenses or renders services after an "Event of
Default" specified in Section 7.1 (f) or (g) of the Trust Indenture occurs, the
expenses and the compensation for the services are intended to constitute
expenses of administration under any Bankruptcy Law.
Mortgagor's obligations under this Section 5.22 shall survive the
resignation or removal of Mortgagee, the discharge of the Obligations and any
rejection or termination of this Mortgage under any Bankruptcy Law.
Section 5.23. Acceptance. By Mortgagee's acceptance of this Mortgage,
Mortgagee agrees to be bound by the terms hereof.
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IN WITNESS WHEREOF, Mortgagor has caused this Mortgage to be duly executed
and attested, all as of the day and year first above written.
TRUMP TAJ MAHAL ASSOCIATES
By: Trump Atlantic City
Corporation,
a general partner
Witness: /s/ [ILLEGIBLE] By: /s/ Nicholas L. Ribis
-------------------- -------------------------
Name: Nicholas L. Ribis
Title: Vice President
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on April 17, 1996, before me, the subscriber, a
Notary Public of the State of New York, personally appeared Nicholas L. Ribis,
to me known, who, being by me duly sworn did depose and say that he resides at
One [ILLEGIBLE] way, Morristown, NJ 07960; that he is Vice President of Trump
Atlantic City Corporation, which is a general partner of TRUMP TAJ MAHAL
ASSOCIATES, the partnership described in and which executed the above
instrument, and he acknowledged that he signed and delivered the same on behalf
of such managing general partner as his voluntary act and deed and as the
voluntary act and deed of said corporation on behalf of said general
partnership, pursuant to authority of the board of directors of said
corporation.
/s/ CHRIS OWEN
--------------------------------
Notary Public
CHRIS OWEN
Notary Public, State of New York
No. 01OW5057119
Qualified in New York County
Commission Expires ________
SCHEDULE 5
SUBORDINATION, NON-DISTURBANCE
AND ATTORNMENT AGREEMENT
THIS AGREEMENT is made as of the_____day of ___________, 199___ by and
between FIRST BANK NATIONAL ASSOCIATION, as Collateral Agent, having an office
at 180 E. 5th Street, St. Paul, MN 55101 (hereinafter called "Mortgagee") and
_________________, a ____________________, having an office at
______________________________(hereinafter called "Tenant").
WITNESSETH:
WHEREAS, Tenant entered into a certain agreement of lease dated
_____________________ , 199___ with Trump Taj Mahal Associates ("TTMA"), as
lessor (and as it may be hereafter amended from time to time the "Lease")
covering certain premises more particularly described therein (the "Demised
Premises"); and
WHEREAS, Mortgagee is the mortgagee under that certain Indenture of
Mortgage and Security Agreement dated as of April 17, 1996, executed and
delivered by TTMA, as mortgagor and intended to be recorded in the office of the
Clerk of Atlantic County (the "Clerk's Office") (said mortgage, as amended,
increased, renewed, modified, consolidated, replaced, combined, substituted,
severed, split, spread or extended, being hereinafter referred to as the
"Mortgage"), which encumbers, inter alia, the Trump Taj Mahal Casino Resort
located in Atlantic City, New Jersey, as more particularly described in said
Mortgage (the "Property"); and
WHEREAS, the Demised Premises are included within the Property.
NOW, THEREFORE, in consideration of the mutual agreements herein contained
and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties hereto agree as follows:
1. Tenant covenants and agrees that the Lease and the rights of Tenant in,
to and under the Lease and the Property now is and shall at all times continue
to be subject and subordinate in each and every respect to the Mortgage and to
any and all renewals, modifications and extensions of the Mortgage and any and
all other instruments held by Mortgagee as security in connection with the
Mortgage. Tenant, upon request, shall execute and deliver any certificate or
other instrument which Mortgagee may reasonably request to confirm said
subordination by Tenant.
2. Tenant certifies that the Lease is presently in full force and effect
and unmodified and no base rent payable thereunder has been paid more than one
(1) month in advance of its due date, and that no default exists under the Lease
which has continued beyond the expiration of any applicable grace period or
which with the giving of notice of passage of time or both will constitute a
default under the Lease. Tenant has no defenses, claims or offsets to its
obligations under the Lease.
3. Provided Tenant is in compliance with the terms of this Agreement and no
default exists under the Lease which has continued beyond the expiration of any
applicable grace period, Mortgagee shall not name Tenant as a party defendant to
any action for foreclosure or other enforcement thereof (unless required by
law), nor shall the Lease be terminated by Mortgagee in connection with, or by
reason of, foreclosure or other proceedings for the enforcement of the Mortgage,
or by reason of a transfer of the landlord's interest under the Lease pursuant
to the taking of a deed in lieu of foreclosure (or similar device), nor shall
Tenant's use or possession of the Demised Premises be interfered with by
Mortgagee, unless the holder of the landlord's interest under the Lease (the
"Landlord") would have had such right if the Mortgage had not been made, except
that the person acquiring, or succeeding to, the interests of the Landlord as a
result of any such action or proceeding, and such person's successors and
assigns (any of the foregoing being hereinafter referred to as the "Successor"),
shall not be:
(a) subject to any credits, offsets, defenses or claims which Tenant
might have against any prior landlord; nor
(b) bound by any prepayment of rent which Tenant might have paid more
than 30 days before the due date of such installment to any prior landlord,
including TTMA, unless such prepayment shall have been made with Mortgagee's
prior written consent; nor
(c) liable for any act or omission of any prior landlord; nor
(d) bound by any covenant to undertake or complete any improvement to
the Demised Premises or the building forming a part of the Property; nor
(e) be required to account for any security deposit other than any
security deposit actually delivered to the Successor; nor
(f) bound by any amendment or change in any material term of the Lease
or by any waiver of any material term of the Lease made by Landlord in violation
of the express terms of the Mortgage unless such amendment, change or waiver is
consented to by Mortgagee; nor
(g) liable for any payment to Tenant of any sums, or the granting to
Tenant of any credit, in the nature of a contribution towards the cost of
preparing, furnishing or moving into the Demised Premises or any portion
thereof.
4. If the interest of the Landlord under the Lease shall be transferred by
reason of foreclosure or other proceedings for enforcement of the Mortgage or
pursuant to a taking of a deed in lieu of foreclosure (or similar device),
Tenant shall be bound to the Successor, and, except as provided in this
Agreement, the Successor shall be bound to Tenant, under all of the terms,
covenants and conditions of the Lease for the balance of the term thereof
remaining, with the same force and effect as if the Successor were the landlord,
and Tenant does hereby (i) agree to attorn to the Successor, including Mortgagee
2
if it be the Successor as its landlord, (ii) affirm its obligations under the
Lease, and (iii) agree to make payments of all sums due under the Lease
to the Successor, said attornment, affirmation and agreement to be effective and
self-operative without the execution of any further instruments, upon written
demand by Mortgagee or upon the Successor succeeding to the interest of the
landlord under the Lease. Tenant waives the provisions of any statue or rule of
law now or hereafter in effect that may give or purport to give it any right or
election to terminate or otherwise adversely affect the Lease or the obligations
of Tenant thereunder by reason of any foreclosure or similar proceeding.
5. Tenant understands that Landlord's interest in the Lease has been
assigned to Mortgagee as security under the Mortgage. Until Mortgagee becomes
owner of the Property, however, Mortgagee assumes no duty, liability or
obligation to Tenant under the Lease.
6. This Agreement may not be modified except by an agreement in writing
signed by the parties or their respective successors in interest. This Agreement
shall inure to the benefit of and be binding upon the parties hereto, their
respective heirs, representatives, successors and assigns.
7. Nothing contained in this Agreement shall in any way impair or affect
the lien created by the Mortgage except as specifically set forth herein.
8. The Tenant agrees that this Agreement satisfies any condition or
requirement in the Lease relating to the granting of a non-disturbance agreement
by Mortgagee. Tenant further agrees that in the event there is any inconsistency
between the terms and provisions hereof and the terms and provisions of the
Lease dealing with the non-disturbance by Mortgagee, the terms and provisions
hereof shall be controlling.
9. All notices, demands or requests made pursuant to, under, or by virtue
of this Agreement must be in writing and mailed to the party whom the notice,
demand or request is being made by certified or registered mail, return receipt
requested, at its address set forth above. Any party may change the place that
notices and demands are to be sent by written notice delivered in accordance
with this Agreement.
10. This Agreement shall be governed by the laws of the State of New
Jersey. If any term of this Agreement or the application thereof to any person
or circumstances shall to any extent be invalid or unenforceable, the remainder
of this Agreement or the application of such term to any person or circumstances
other than those as to which it is invalid or unenforceable shall not be
affected thereby, and each term of this Agreement shall be valid and enforceable
to the fullest extent permitted by law.
11. This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one and the same agreement, and either of
the parties hereto may execute this Agreement by signing any such counterpart.
3
IN WITNESS WHEREOF, the parties hereto have hereunto caused this Agreement
to be duly executed as of the day and year first above written.
MORTGAGEE
ATTEST: FIRST BANK NATIONAL ASSOCIATION,
as COLLATERAL AGENT
____________________ By:___________________________
Typed Name:___________________
Title:________________________
TENANT
ATTEST:
____________________ By:___________________________
Typed Name:___________________
Title:________________________
TTMC joins in this Agreement and agrees to be bound by the terms hereof.
TTMC
ATTEST:
____________________ By:___________________________
Typed Name: Typed Name:___________________
Title: Title:________________________
4
STATE OF NEW YORK
ss
COUNTY OF NEW YORK
BE IT REMEMBERED, that on this _______day of ____________________, 199__,
before me, the subscrober, a Notary Public of ____________________, personally
appeared ___________________, the _____________________ of First Bank National
Association, who, I am satisfied, is the person who signed, sealed with the
corporate seal and delivered the same as such officer aforesaid, and that the
within instrument is the voluntary act and deed of such corporation.
__________________________
STATE OF
SS
COUNTY OF
BE IT REMEMBERED, that on this _____day of _________________, 199__, before
me, the subscriber, a Notary Public of ____________, personally appeared
________________, the ____________________ President of
___________________________, who, I am satisfied, is the person who signed,
sealed with the corporate seal and delivered the same as such officer aforesaid,
and that the within instrument is the voluntary act and deed of such corporation
pursuant to a proper resolution of its Board of Directors.
__________________________
STATE OF
SS
COUNTY OF
BE IT REMEMBERED, that on this _____day of _________________, 199__, before
me, the subscriber, a Notary Public of ____________, personally appeared
________________, the ____________________ President of
___________________________, who, I am satisfied, is the person who signed,
sealed with the corporate seal and delivered the same as such officer aforesaid,
and that the within instrument is the voluntary act and deed of such corporation
pursuant to a proper resolution of its Board of Directors.
--------------------------
5