MORTGAGE
DOCUMENT NUMBER:
RECORDATION REQUESTED BY:
WISCONSIN COMMUNITY BANK
WISCONSIN BUSINESS BANK - BRANCH
GREEN BAY OFFICE
1510 HWY 41 PO BOX 5307
DE PERE, WI 54115-5307
PARCEL I.D. NUMBER:
THIS MORTGAGE dated September 19, 2002, is made and executed between BADGER
PAPER MILLS, INC., whose address is 200 W. FRONT ST., PESHTIGO, WI 54157; A
WISCONSIN CORPORATION (referred to below as "Grantor") and WISCONSIN COMMUNITY
BANK, whose address is GREEN BAY OFFICE, 1510 HWY 41 PO BOX 5307, DE PERE, WI
54115-5307 (referred to below as "Lender").
GRANT OF MORTGAGE. For valuable consideration, Grantor mortgages and conveys to
Lender all of Grantor's right, title, and interest in and to the following
described real property, together with all existing or subsequently erected or
affixed building, improvements and fixtures; privileges, hereditaments,
easements, rights of way, and appurtenances; all water, water rights,
watercourses and ditch rights (including stock in utilities with ditch or
irrigation rights); and all other rights, royalties, and profits relating to the
real property, including without limitation all minerals, oil, gas, geothermal
and similar matters, (the "Real Property") located in MARINETTE County, State of
Wisconsin:
See EXHIBIT A, which is attached to this Mortgage and made a part of
this Mortgage as if fully set forth herein.
The Real Property or its address is commonly known as 200 W. FRONT ST.,
PESHTIGO, WI 54157.
CROSS-COLLATERALIZATION. In addition to the Note, this Mortgage secures all
obligations, debts and liabilities, plus interest thereon, of Grantor to Lender,
or any one or more of them, as well as all claims by Lender against Grantor or
any one or more of them, whether now existing or hereafter arising, whether
related or unrelated to the purpose of the Note, whether voluntary or otherwise,
whether due or not due, direct or indirect, determined or undetermined, absolute
or contingent, liquidated or unliquidated whether Grantor may be liable
individually or jointly with others, whether obligated as guarantor, surety,
accommodation party
or otherwise, and whether recovery upon such amounts may be or hereafter may
become barred by any statute of limitations, and whether the obligation to repay
such amounts may be or hereafter may become otherwise unenforceable.
This property is not the Grantor's homestead.
Grantor presently assigns to Lender all of Grantor's right, title, and interest
in and to all present and future leases of the Property and all Rents from the
Property. In addition, Grantor grants to Lender a Uniform Commercial Code
security interest in the Personal Property and Rents.
FUTURE ADVANCES. Specifically, without limitation, this Mortgage secures, in
addition to the amounts specified in the Note, all future amounts Lender in its
discretion may loan to Grantor, together with all interest thereon.
THIS MORTGAGE, INCLUDING THE ASSIGNMENT OF RENTS AND THE SECURITY INTEREST IN
THE RENTS AND PERSONAL PROPERTY, IS GIVEN TO SECURE (A) PAYMENT OF THE
INDEBTEDNESS AND (B) PERFORMANCE OF ANY AND ALL OBLIGATIONS UNDER THE NOTE, THE
RELATED DOCUMENTS, AND THIS MORTGAGE. THIS MORTGAGE IS GIVEN AND ACCEPTED ON THE
FOLLOWING TERMS:
PAYMENT AND PERFORMANCE. Except as otherwise provided in this Mortgage, Grantor
shall pay to Lender all amounts secured by this Mortgage as they become due and
shall strictly perform all of Grantor's obligations under this Mortgage.
POSSESSION AND MAINTENANCE OF THE PROPERTY. Grantor agrees that Grantor's
possession and use of the Property shall be governed by the following
provisions:
Possession and Use. Until the occurrence of an Event of Default,
Grantor may (1) remain in possession and control of the Property; (2)
use, operate or manage the Property; and (3) collect the Rents from the
Property.
Duty to Maintain. Grantor shall maintain the Property in tenantable
condition and promptly perform all repairs, replacements, and
maintenance necessary to preserve its value.
Compliance With Environmental Laws. Grantor represents and warrants to
Lender that: (1) During the period of Grantor's ownership of the
Property, there has been no use, generation, manufacture, storage,
treatment, disposal, release or threatened release of any Hazardous
Substance by any person on, under, about or from the Property; (2)
Grantor has no knowledge of, or reason to believe that there has been,
except as previously disclosed to and acknowledged by Lender in
writing, (a) any breach or violation of any Environmental Laws, (b) any
use, generation, manufacture, storage, treatment, disposal, release or
threatened release of any Hazardous Substance on, under, about or from
the Property by any prior owners or occupants of the Property, or (c)
any actual or threatened litigation or claims of any kind by any person
relating to such matters; and (3) Except as
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previously disclosed to and acknowledged by Lender in writing, (a)
neither Grantor nor any tenant, contractor, agent or other authorized
user of the Property shall use, generate, manufacture, store, treat,
dispose of or release any Hazardous Substance on, under, about or from
the Property; and (b) any such activity shall be conducted in
compliance with all applicable federal, state, and local laws,
regulations and ordinances, including without limitation all
Environmental Laws. Grantor authorizes Lender and its agents to enter
upon the Property to make such inspections and tests, at Grantor's
expense, as Lender may deem appropriate to determine compliance of the
Property with this section of the Mortgage. Any inspections or tests
made by Lender shall be for Lender's purposes only and shall not be
construed to create any responsibility or liability on the part of
Lender to Grantor or to any other person. The representations and
warranties contained herein are based on Grantor's due diligence in
investigating the Property for Hazardous Substances. Grantor hereby (1)
releases and waives any future claims against Lender for indemnity or
contribution in the event Grantor becomes liable for cleanup or other
costs under any such laws; and (2) agrees to indemnify and hold
harmless Lender against any and all claims, losses, liabilities,
damages, penalties, and expenses which Lender may directly or
indirectly sustain or suffer resulting from a breach of this section of
the Mortgage or as a consequence of any use, generation, manufacture,
storage, disposal, release or threatened release occurring prior to
Grantor's ownership or interest in the Property, whether or not the
same was or should have been known to Grantor. The provisions of this
section of the Mortgage, including the obligation to indemnify, shall
survive the payment of the indebtedness and the satisfaction and
reconveyance of the lien of this Mortgage and shall not be affected by
Lender's acquisition of any interest in the Property, whether by
foreclosure or otherwise.
Nuisance, Waste. Grantor shall not cause, conduct or permit any
nuisance nor commit, permit, or suffer any stripping of or waste on or
to the Property or any portion of the Property. Without limiting the
generality of the foregoing, Grantor will not remove, or grant to any
other party the right to remove, any timber, minerals (including oil
and gas), coal, clay, scoria, soil, gravel or rock products without
Lender's prior written consent.
Removal of Improvements. Grantor shall not demolish or remove any
Improvements from the Real Property without Lender's prior written
consent. As a condition to the removal of any Improvements, Lender may
require Grantor to make arrangements satisfactory to Lender to replace
such Improvements with Improvements of at least equal value.
Lender's Right to Enter. Lender and Lender's agents and representatives
may enter upon the Real Property at all reasonable times to attend to
Lender's interests and to inspect the Real Property for purposes of
Grantor's compliance with the terms and conditions of this Mortgage.
Compliance with Governmental Requirements. Grantor shall promptly
comply with all laws, ordinances, and regulations, now or hereafter in
effect, of all governmental authorities applicable to the use or
occupancy of the Property, including without limitation, the Americans
With Disabilities Act. Grantor may contest in good faith any
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such law, ordinance, or regulation and withhold compliance during any
proceeding, including appropriate appeals, so long as Grantor has
notified Lender in writing prior to doing so and so long as, in
Lender's sole opinion, Lender's interests in the Property are not
jeopardized. Lender may require Grantor to post adequate security or a
surety bond, reasonably satisfactory to Lender, to protect Lender's
interest.
Duty to Protect. Grantor agrees neither to abandon nor leave unattended
the Property. Grantor shall do all other acts, in addition to those
acts set forth above in this section, which from the character and use
of the Property are reasonably necessary to protect and preserve the
Property.
DUE ON SALE - CONSENT BY LENDER. Lender may, at Lender's option, declare
immediately due and payable all sums secured by this Mortgage upon the sale or
transfer, without Lender's prior written consent, of all or any part of the Real
Property, or any interest in the Real Property. A "sale or transfer" means the
conveyance of Real Property or any right, title or interest in the Real
Property; whether legal, beneficial or equitable; whether voluntary or
involuntary; whether by outright sale, deed, installment sale contract, land
contract, contract for deed, leasehold interest with a term greater than three
(3) years, lease-option contract, or by sale, assignment, or transfer of any
beneficial interest in or to any land trust holding title to the Real Property,
or by any other method of conveyance of an interest in the Real Property. If any
Grantor is a corporation, partnership or limited liability company, transfer
also includes any change in ownership of more than twenty-five percent (25%) of
the voting stock, partnership interests or limited liability company interests,
as the case may be, of such Grantor. However, this option shall not be exercised
by Lender if such exercise is prohibited by federal law or by Wisconsin law.
TAXES AND LIENS. The following provisions relating to the taxes and liens on the
Property are part of this Mortgage:
Payment. Grantor shall pay when due (and in all events prior to
delinquency) all taxes, payroll taxes, special taxes, assessments,
water charges and sewer service charges levied against or on account of
the Property or this Mortgage, and shall pay when due all claims for
work done on or for services rendered or material furnished to the
Property. Grantor shall maintain the Property free of any liens having
priority over or equal to the interest of Lender under this Mortgage,
except for those liens specifically agreed to in writing by Lender, and
except for the lien of taxes and assessments not due as further
specified in the Right to Contest paragraph.
Right to Contest. Grantor may withhold payment of any tax, assessment,
or claim in connection with a good faith dispute over the obligation to
pay, so long as Lender's interest in the Property is not jeopardized.
If a lien arises or is filed as a result of nonpayment, Grantor shall
within fifteen (15) days after the lien arises or, if a lien is filed,
within fifteen (15) days after Grantor has notice of the filing, secure
the discharge of the lien, or if requested by Lender, deposit with
Lender cash or a sufficient corporate surety bond or other security
satisfactory to Lender in an amount sufficient to discharge the lien
plus any costs and permissible fees, or other charges that could accrue
as a result
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of a foreclosure or sale under the lien. In any contest, Grantor shall
defend itself and Lender and shall satisfy any adverse judgment before
enforcement against the Property. Grantor shall name Lender as an
additional obligee under any surety bond furnished in the contest
proceedings.
Evidence of Payment. Grantor shall upon demand furnish to Lender
satisfactory evidence of payment of the taxes or assessments and shall
authorize the appropriate governmental official to deliver to Lender at
any time a written statement of the taxes and assessments against the
Property.
Notice of Construction. Grantor shall notify Lender at least fifteen
(15) days before any work is commenced, any services are furnished, or
any materials are supplied to the Property, if any mechanic's lien,
materialmen's lien, or other lien could be asserted on account of the
work, services, or materials. Grantor will upon request of Lender
furnish to Lender advance assurances satisfactory to Lender that
Grantor can and will pay the cost of such Improvements.
PROPERTY DAMAGE INSURANCE. The following provisions relating to insuring the
Property are a part of this Mortgage:
Maintenance of Insurance. Grantor shall procure and maintain policies
of fire insurance with standard extended coverage endorsements on a
replacement basis for the full insurable value covering all
Improvements on the Real Property in an amount sufficient to avoid
application of any coinsurance clause, and with a standard mortgage
clause in favor of Lender. Grantor shall also procure and maintain
comprehensive general liability insurance in such coverage amounts as
Lender may request with Lender being named as additional insureds in
such liability insurance policies. Additionally, Grantor shall maintain
such other insurance, including but not limited to hazard, business
interruption and boiler insurance as Lender may require. Policies shall
be written by such insurance companies and in such form as may be
reasonably acceptable to Lender. Grantor shall deliver to Lender
certificates of coverage from each insurer containing a stipulation
that coverage will not be cancelled or diminished without a minimum of
ten (10) days' prior written notice to Lender and not containing any
disclaimer of the insurer's liability for failure to give such notice.
Each insurance policy also shall include an endorsement providing that
coverage in favor of Lender will not be impaired in any way by any act,
omission or default of Grantor or any other person. Should the Real
Property be located in an area designated by the Director of the
Federal Emergency Management Agency as a special flood hazard area,
Grantor agrees to obtain and maintain Federal Flood Insurance, if
available, within 45 days after notice is given by Lender that the
Property is located in a special flood hazard area, for the full unpaid
principal balance of the loan and any prior liens on the property
securing the loan, up to the maximum policy limits set under the
National Flood Insurance Program, or as otherwise required by Lender,
and to maintain such insurance for the term of the loan.
Application of Proceeds. Grantor shall promptly notify Lender of any
loss or damage to the Property. Lender may make proof of loss if
Grantor fails to do so within fifteen (15)
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days of the casualty. Whether or not Lender's security is impaired,
Lender may, at Lender's election, receive and retain the proceeds of
any insurance and apply the proceeds to the reduction of the
indebtedness, payment of any lien affecting the Property, or the
retention and repair of the Property. If Lender elects to apply the
proceeds to restoration and repair, Grantor shall repair or replace the
damaged or destroyed improvements in a manner satisfactory to Lender.
Lender shall, upon satisfactory proof of such expenditure, pay or
reimburse Grantor from the proceeds for the reasonable cost of repair
or restoration if Grantor is not in default under this Mortgage. Any
proceeds which have not been disbursed within 180 days after their
receipt and which Lender has not committed to the repair or restoration
of the Property shall be used first to pay any amount owing to Lender
under this Mortgage, then to pay accrued interest, and the remainder,
if any, shall be applied to the principal balance of the indebtedness.
If Lender holds any proceeds after payment in full of the indebtedness,
such proceeds shall be paid to Grantor as Grantor's interests may
appear.
Unexpired Insurance at Sale. Any unexpired insurance shall inure to the
benefit of, and pass to, the purchaser of the Property covered by this
Mortgage at any trustee's sale or other sale held under the provisions
of this Mortgage, or at any foreclosure sale of such Property.
Grantor's Report on Insurance. Upon request of Lender, however not more
than once a year, Grantor shall furnish to Lender a report on each
existing policy of insurance showing: (1) the name of the insurer; (2)
the risks insured; (3) the amount of the policy; (4) the property
insured, the then current replacement value of such property, and the
manner of determining that value; and (5) the expiration date of the
policy. Grantor shall, upon request of Lender, have an independent
appraiser satisfactory to Lender determine the cash value replacement
cost of the Property.
TAX AND INSURANCE RESERVES. Subject to any limitations set by applicable law,
Lender may require Grantor to maintain with Lender reserves for payment of
annual taxes, assessments, and insurance premiums, which reserves shall be
created by advance payment or monthly payments of a sum estimated by Lender to
be sufficient to produce, amounts at least equal to the taxes, assessments, and
insurance premiums to be paid. The reserve funds shall be held by Lender as a
general deposit from Grantor, which Lender may satisfy by payment of the taxes,
assessments, and insurance premiums required to be paid by Grantor as they
become due. Lender shall have the right to draw upon the reserve funds to pay
such items, and Lender shall not be required to determine the validity or
accuracy of any item before paying it. Nothing in the Mortgage shall be
construed as requiring Lender to advance other monies for such purpose, and
Lender shall not incur any liability for anything it may do or omit to do with
respect to the reserve account. Subject to any limitations set by applicable
law, if the reserve funds disclose a shortage or deficiency, Grantor shall pay
such shortage or deficiency as required by Lender. All amounts in the reserve
account are hereby pledged to further secure the indebtedness, and Lender is
hereby authorized to withdraw and apply such amounts on the indebtedness upon
the occurrence of an Event of Default. Lender shall not be required to pay any
interest or earnings on the reserve funds unless required by law or agreed to by
Lender in writing. Lender does not
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hold the reserve funds in trust for Grantor, and Lender is not Grantor's agent
for payment of the taxes and assessments required to be paid by Grantor.
LENDER'S EXPENDITURES. If any action or proceeding is commenced that would
materially affect Lender's interest in the Property or if Grantor fails to
comply with any provision of this Mortgage or any Related Documents, including
but not limited to Grantor's failure to discharge or pay when due any amounts
Grantor is required to discharge or pay under this Mortgage or any Related
Documents, Lender on Grantor's behalf may (but shall not be obligated to) take
any action that Lender deems appropriate, including but not limited to
discharging or paying all taxes, liens, security interests, encumbrances and
other claims, at any time levied or placed on the Property and paying all costs
for insuring, maintaining and preserving the Property. All such expenditures
incurred or paid by Lender for such purposes will then bear interest at the rate
charged under the Note from the date incurred or paid by Lender to the date of
payment by Grantor. All such expenses will become a part of the indebtedness
and, at Lender's option, will (A) be payable on demand; (B) be added to the
balance of the Note and be apportioned among and be payable with any installment
payments to become due during either (1) the term of any applicable insurance
policy; or (2) the remaining term of the Note; or (C) be treated as a balloon
payment which will be due and payable at the Note's maturity. The Mortgage also
will secure payment of these amounts. Such right shall be in addition to all
other rights and remedies to which Lender may be entitled upon Default.
WARRANTY; DEFENSE OF TITLE. The following provisions relating to ownership of
the Property are a part of this Mortgage:
Title. Grantor warrants that: (a) Grantor holds good and marketable
title of record to the Property in fee simple, free and clear of all
liens and encumbrances other than those set forth in the Real Property
description or in any title insurance policy, title report, or final
title opinion issued in favor of, and accepted by, Lender in connection
with this Mortgage, and (b) Grantor has the full right, power, and
authority, acting alone, to execute and deliver this Mortgage to
Lender.
Defense of Title. Subject to the exception in the paragraph above,
Grantor warrants and will forever defend the title to the Property
against the lawful claims of all persons. In the event any action or
proceeding is commenced that questions Grantor's title or the interest
of Lender under this Mortgage, Grantor shall defend the action at
Grantor's expense. Grantor may be the nominal party in such proceeding,
but Lender shall be entitled to participate in the proceeding and to be
represented in the proceeding by counsel of Lender's own choice, and
Grantor will deliver, or cause to be delivered, to Lender such
instruments as Lender may request from time to time to permit such
participation.
Subrogation. Grantor covenants that Lender is subrogated to the lien of
any mortgage or any other lien which is discharged, whether in whole or
in part, by the proceeds of the Note.
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Compliance with Laws. Grantor warrants that the Property and Grantor's
use of the Property complies with all existing applicable laws,
ordinances, and regulations of governmental authorities.
Survival of Representations and Warranties. All representations,
warranties, and agreements made by Grantor in this Mortgage shall
survive the execution and delivery of this Mortgage, shall be
continuing in nature, and shall remain in full force and effect until
such time as Grantor's indebtedness shall be paid in full.
CONDEMNATION. The following provisions relating to condemnation proceedings are
a part of this Mortgage:
Proceedings. If any proceeding in condemnation is commenced, Grantor
shall promptly notify Lender in writing, and Grantor shall promptly
take such steps as may be necessary to defend the action and obtain the
award. Grantor may be the nominal party in such proceeding, but Lender
shall be entitle to participate in the proceeding and to be represented
in the proceeding by counsel of its own choice, and Grantor will
deliver or cause to be delivered to Lender such instruments and
documentation as may be requested by Lender from time to time to permit
such participation.
Application of Net Proceedings. If all or any part of the Property is
condemned by eminent domain proceedings or by any proceeding or
purchase in lieu of condemnation or if all or any part of the Property
is sold in lieu of condemnation, Lender may at its election require
that all or any portion of the net proceeds of the award or sale be
applied to the indebtedness or the repair or restoration of the
Property. The net proceeds of the award or sale shall mean the award or
sale after payment of all reasonable costs, expenses, and attorneys'
fees incurred by Lender in connection with the condemnation or sale in
lieu of condemnation.
IMPOSITION OF TAXES, FEES AND CHARGES BY GOVERNMENTAL AUTHORITIES. The following
provisions relating to governmental taxes, fees and charges are a part of this
Mortgage:
Current Taxes, Fees and Charges. Upon request of Lender, Grantor shall
execute such documents in addition to this Mortgage and take whatever
other action is requested by Lender to perfect and continue Lender's
lien on the Real Property. Grantor shall reimburse Lender for all
taxes, as described below, together with all expenses incurred in
recording, perfecting or continuing this Mortgage, including without
limitation all taxes, fees, documentary stamps, and other charges for
recording or registering this Mortgage.
Taxes. The following shall constitute taxes to which this section
applies: (1) a specific tax upon this type of Mortgage or upon all or
any part of the indebtedness secured by this Mortgage; (2) a specific
tax on Grantor which Grantor is authorized or required to deduct from
payments on the indebtedness secured by this type of Mortgage; (3) a
tax on this type of Mortgage chargeable against the Lender or the
holder of the Note; and (4) a
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specific tax on all or any portion of the indebtedness or on payments
of principal and interest made by Grantor.
Subsequent Taxes. If any tax to which this section applies is enacted
subsequent to the date of this Mortgage, this event shall have the same
effect as an Event of Default, and Lender may exercise any or all of
its available remedies for an Event of Default as provided below unless
Grantor either (1) pays the tax before it becomes delinquent, or (2)
contests the tax as provided above in the Taxes and Liens section and
deposits with Lender cash or a sufficient corporate surety bond or
other security satisfactory to Lender.
SECURITY AGREEMENT; FINANCING STATEMENTS. The following provisions relating to
this Mortgage as a security agreement are a part of this Mortgage:
Security Agreement. This instrument shall constitute a Security
Agreement to the extent any of the Property constitutes fixtures, and
Lender shall have all of the rights of a secured party under the
Uniform Commercial Code as amended from time to time.
Security Interest. Upon request by Lender, Grantor shall execute
financing statements and take whatever other action is requested by
Lender to perfect and continue Lender's security interest in the Rents
and Personal Property. In addition to recording this Mortgage in the
real property records, Lender may, at any time and without further
authorization from Grantor, file executed counterparts, copies or
reproductions of this Mortgage as a financing statement. Grantor shall
reimburse Lender for all expenses incurred in perfecting or continuing
this security interest. Upon default, Grantor shall not remove, sever
or detach the Personal Property from the Property. Upon default,
Grantor shall assemble any Personal Property not affixed to the
Property in a manner and at a place reasonably convenient to Grantor
and Lender and make it available to Lender within three (3) days after
receipt of written demand from Lender to the extent permitted by
applicable law.
Addressees. The mailing addresses of Grantor (debtor) and Lender
(secured party) from which information concerning the security interest
granted by this Mortgage may be obtained (each as required by the
Uniform Commercial Code) are as stated on the first page of this
Mortgage.
FURTHER ASSURANCES; ATTORNEY-IN-FACT. The following provisions relating to
further assurances and attorney-in-fact are a part of this Mortgage:
Further Assurances. At any time, and from time to time, upon request of
Lender, Grantor will make, execute and deliver, or will cause to be
made, executed or delivered, to Lender or to Lender's designee, and
when requested by Lender, cause to be filed, recorded, refiled, or
rerecorded, as the case may be, at such times and in such offices and
places as Lender may deem appropriate, any and all such mortgages,
deeds of trust, security deeds, security agreements, financing
statements, continuation statements, instruments of further assurance,
certificates, and other documents as may, in the sole opinion of
Lender, be necessary or desirable in order to effectuate, complete,
perfect, continue, or preserve (1)
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Grantor's obligations under the Note, this Mortgage, and the Related
documents, and (2) the liens and security interests created by this
Mortgage as first and prior liens on the Property, whether now owned or
hereafter acquired by Grantor. Unless prohibited by law or Lender
agrees to the contrary in writing, Grantor shall reimburse Lender for
all costs and expenses incurred in connection with the matters referred
to in this paragraph.
Attorney-in-Fact. If Grantor fails to do any of the things referred to
in the preceding paragraph. Lender may do so for and in the name of
Grantor and at Grantor" expense. For such purposes, Grantor hereby
irrevocably appoints Lender as Grantor's attorney-in-fact for the
purpose of making, executing, delivering, filing, recording, and doing
all other things as may be necessary or desirable, in Lender's sole
opinion, to accomplish the matters referred to in the preceding
paragraph.
FULL PERFORMANCE. If Grantor pays all the indebtedness, including without
limitation all future advances, when due, and otherwise performs all the
obligations imposed upon Grantor under this Mortgage, Lender shall execute and
deliver to Grantor a suitable satisfaction of this Mortgage and suitable
statements of termination of any financing statement on file evidencing Lender's
security interest in the Rents and the Personal Property. Grantor will pay, if
permitted by applicable law, any reasonable termination fee as determined by
Lender from time to time.
EVENTS OF DEFAULT. Each of the following, at Lender's option, shall constitute
an Event of Default under this Mortgage:
Payment Default. Grantor fails to make any payment when due under the
indebtedness.
Default on Other Payments. Failure of Grantor within the time required
by this Mortgage to make any payment for taxes or insurance, or any
other payment necessary to prevent filing of or to effect discharge of
any lien.
Other Defaults. Grantor fails to comply with or to perform any other
term, obligation, covenant or condition contained in this Mortgage or
in any of the Related Documents or to comply with or to perform any
term, obligation, covenant or condition contained in any other
agreement between Lender and Grantor.
Default in Favor of Third Parties. Should Grantor default under any
loan, extension of credit, security agreement, purchase or sales
agreement, or any other agreement, in favor of any other creditor or
person that may materially affect any of Grantor's property or
Grantor's ability to repay the indebtedness of Grantor's ability to
perform Grantor's obligations under this Mortgage or any related
document.
False Statements. Any warranty, representation or statement made or
furnished to Lender by Grantor or on Grantor's behalf under this
Mortgage or the Related Documents is false and misleading in any
material respect, either now or at the time made or furnished or
becomes false or misleading at any time thereafter.
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Defective Collateralization. This Mortgage or any of the Related
Documents ceases to be in full force and effect (including failure of
any collateral document to create a valid and perfected security
interest or lien) at any time and for any reason.
Insolvency. The dissolution or termination of Grantor's existence as a
going business, the insolvency of Grantor, the appointment of a
receiver for any part of Grantor's property, any assignment for the
benefit of creditors, any type of creditor workout, or the commencement
of any proceeding under any bankruptcy or insolvency laws by or against
Grantor.
Creditor or Forfeiture Proceedings. Commencement of foreclosure or
forfeiture proceedings, whether by judicial proceeding, self-help,
repossession or any other method, by any creditor of Grantor or by any
governmental agency against any property securing the indebtedness.
This includes a garnishment of any of Grantor's accounts, including
deposit accounts, with Lender. However, this Event of Default shall not
apply if there is a good faith dispute by Grantor as to the validity or
reasonableness of the claim which is the basis of the creditor or
forfeiture proceeding and if Grantor gives Lender written notice of the
creditor or forfeiture proceeding and deposits with Lender monies or a
surety bond for the creditor or forfeiture proceeding, in an amount
determined by Lender, in its sole discretion, as being an adequate
reserve or bond for the dispute.
Breach of Other Agreement. Any breach by Grantor under the terms of any
other agreement between Grantor and Lender that is not remedied within
any grace period provided therein, including without limitation any
agreement concerning any indebtedness or other obligation of Grantor to
Lender, whether existing now or later.
Events Affecting Guarantor. Any of the preceding events occurs with
respect to any guarantor, endorser, surety, or accommodation party of
any of the indebtedness or any guarantor, endorser, surety, or
accommodation party dies or becomes incompetent, or revokes or disputes
the validity of, or liability under, any Guaranty of the indebtedness.
In the event of a death, Lender, at its option, may, but shall not be
required to, permit the guarantor's estate to assume unconditionally
the obligations arising under the guaranty in a manner satisfactory to
Lender, and, in doing so, cure any Event of Default.
Adverse Change. A material adverse change occurs in Grantor's financial
condition, or Lender believes the prospect of payment or performance of
the indebtedness is impaired.
Insecurity. Lender in good faith believes itself insecure.
Right to Cure. If such a failure is curable and if Grantor has not been
given a notice of a breach of the same provision of this Mortgage with
the preceding twelve (12) months, it may be cured (and no Event of
Default will have occurred) if Grantor, after Lender sends written
notice demanding cure of such failure: (a) cures the failure within
thirty (30) days; or (b) if the cure requires more than thirty (30)
days, immediately initiates steps sufficient to cure the failure and
thereafter continues and completes all reasonable and necessary steps
sufficient to produce compliance as soon as reasonably practical.
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RIGHTS AND REMEDIES ON DEFAULT. Upon the occurrence of an Event of Default and
at any time thereafter, Lender, at Lender's option, may exercise any one or more
of the following rights and remedies, in addition to any other rights or
remedies provided by law:
Accelerate Indebtedness. Lender shall have the right at it option
without notice to Grantor to declare the entire indebtedness
immediately due and payable, including any prepayment penalty which
Grantor would be required to pay.
UCC Remedies. With respect to all or any part of the Personal Property,
Lender shall have all the rights and remedies of a secured party under
the Uniform Commercial Code.
Collect Rents. Lender shall have the right, without notice to Grantor,
to take possession of the Property and collect the Rents, including
amounts past due and unpaid, and apply the net proceeds, over and above
Lender's costs, against the indebtedness. In furtherance of this right,
Lender may require any tenant or other user of the Property to make
payments of rent or use fees directly to Lender. If the Rents are
collected by Lender, then Grantor irrevocably designates Lender as
Grantor's attorney-in-fact to endorse instruments received in payment
thereof in the name of Grantor and to negotiate the same and collect
the proceeds. Payments by tenants or other users to Lender in response
to Lender's demand shall satisfy the obligations for which the payments
are made, whether or not any proper grounds for the demand existed.
Lender may exercise its rights under this subparagraph either in
person, by agent, or through a receiver.
Appoint Receiver. Lender shall have the right to have a receiver
appointed to take possession of all or any part of the Property, with
the power to protect and preserve the Property, to operate the Property
preceding foreclosure or sale, and to collect the Rents from the
Property and apply the proceeds, over and above the cost of the
receivership, against the indebtedness or as the court may direct. The
receiver may serve without bond if permitted by law. Lender's right to
the appointment of a receiver shall exist whether or not the apparent
value of the Property exceeds the indebtedness by a substantial amount.
Employment by Lender shall not disqualify a person from serving as a
receiver.
Judicial Foreclosure. Lender may obtain a judicial decree foreclosing
Grantor's interest in all or any part of the Property.
Nonjudicial Sale. If permitted by applicable law, Lender may foreclose
Grantor's interest in all or any part of the Personal Property or the
Real Property by non-judicial sale.
Deficiency Judgment. If permitted by applicable law, Lender may obtain
a judgment for any deficiency remaining in the indebtedness due to
Lender after application of all amounts received from the exercise of
the rights provided in this section.
Foreclosure without Deficiency Judgment. Grantor agrees to the
provisions of Wis. Stats. Section 846.101 (as the same may be amended
or renumbered from time to time) if the Real Property is twenty (20)
acres or less, and is either (1) a 1-4 family residence that
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is owner-occupied at the initiation of a foreclosure proceeding, (2) a
church, (3) a farm, or (4) is owned by a tax exempt charitable
organization. Pursuant to Wis. Stats. Section 846.101, Lender, upon
waiving the right to judgment for any deficiency, may conduct a
foreclosure sale of the Real Property six (6) months after a
foreclosure judgment is entered. If the Real Property is a type other
than that described in Wis. Stats. Section 846.101(1), then Grantor
agrees to the provisions of Wis. Stats. Section 846.103 (as the same
may be amended or renumbered from time to time) permitting Lender, upon
waiving the right to judgment for any deficiency, to conduct a
foreclosure sale of the Real Property three (3) months after a
foreclosure judgment is entered.
Tenancy at Sufferance. If Grantor remains in possession of the Property
after the Property is sold as provided above or Lender otherwise
becomes entitled to possession of the Property upon default of Grantor,
Grantor shall become a tenant at sufferance of Lender or the purchaser
of the Property and shall, at Lender's option, either (1) pay a
reasonable rental for the use of the Property, or (2) vacate the
Property immediately upon the demand of Lender.
Other Remedies. Lender shall have all other rights and remedies
provided in this Mortgage or the Note or available at law or in equity.
Sale of the Property. To the extent permitted by applicable law,
Grantor hereby waives any and all right to have the Property
marshalled. In exercising its rights and remedies, Lender shall be free
to sell all or any part of the Property together or separately, in one
sale or by separate sales, and to execute and deliver to the purchasers
of the Property deeds of conveyance pursuant to law. Lender shall be
entitled to bid at any public sale on all or any portion of the
Property.
Notice of Sale. Lender shall give Grantor reasonable notice of the time
and place of any public sale of the Personal Property or of the time
after which any private sale or other intended disposition of the
Personal Property is to be made. Reasonable notice shall mean notice
given at least fifteen (15) days before the time of the sale or
disposition.
Election of Remedies. Election by Lender to pursue any remedy shall not
exclude pursuit of any other remedy, and an election to make
expenditures or to take action to perform an obligation of Grantor
under this Mortgage, after Grantor's failure to perform, shall not
affect Lender's right to declare a default and exercise its remedies.
Nothing under this Mortgage or otherwise shall be construed so as to
limit or restrict the rights and remedies available to Lender following
an Event of Default, or in any way to limit or restrict the rights and
ability of Lender to proceed directly against Grantor and/or against
any other co-maker, guarantor, surety or endorser and/or to proceed
against any other collateral directly or indirectly securing the
indebtedness.
Expenses. If Lender institutes any suit or action to enforce any of the
terms of this Mortgage, Lender shall be entitled to recover such sum as
the court may adjudge reasonable. Whether or not any court action is
involved, all reasonable expenses Lender incurs that in Lender's
opinion are necessary at any time for the protection of its interest
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or the enforcement of its rights shall become a part of the
indebtedness payable on demand and shall bear interest at the Note rate
from the date of the expenditure until repaid. Expenses covered by this
paragraph include, without limitation, however subject to any limits
under applicable law, Lender's legal expenses whether or not there is a
lawsuit, including expenses for bankruptcy proceedings (including
efforts to modify or vacate any automatic stay or injunction), appeals,
and any anticipated post-judgment collection services, the cost of
searching records, obtaining title reports (including foreclosure
reports), surveyors' reports, and appraisal fees and title insurance,
to the extent permitted by applicable law. Grantor also will pay any
court costs, in addition to all other sums provided by law.
NOTICES. Any notice required to be given under this Mortgage, including without
limitation any notice of default and any notice of sale shall be given in
writing, and shall be effective when actually delivered, when actually received
by telefacsimile (unless otherwise required by law), when deposited with a
nationally recognized overnight courier, or, if mailed, when deposited in the
United States mail, as first class, certified or registered mail postage
prepaid, directed to the addresses shown near the beginning of this Mortgage.
All copies of notices of foreclosure from the holder of any lien which has
priority over this Mortgage shall be sent to Lender's address, as shown near the
beginning of this Mortgage. Any party may change its address for notices under
this Mortgage by giving formal written notice to the other parties, specifying
that the purpose of the notice is to change the party's address. For notice
purposes, Grantor agrees to keep Lender informed at all times of Grantor's
current address. Unless otherwise provided or required by law, if there is more
than one Grantor, any notice given by Lender to any Grantor is deemed to be
notice given to all Grantors.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Mortgage:
Amendments. This Mortgage, together with any Related Documents,
constitutes the entire understanding and agreement of the parties as to
the matters set forth in this Mortgage. No alteration of or amendment
to this Mortgage shall be effective unless given in writing and signed
by the party or parties sought to be charged or bound by the alteration
or amendment.
Annual Reports. If the Property is used for purposes other than
Grantor's residence, Grantor shall furnish to Lender, upon request, a
certified statement of net operating income received from the Property
during Grantor's previous fiscal year in such form and detail as Lender
shall require. "Net operating income" shall mean all cash receipts from
the Property less all cash expenditures made in connection with the
operation of the Property.
Caption Headings. Caption headings in this Mortgage are for convenience
purposes only and are not to be used to interpret or define the
provisions of this Mortgage.
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Governing Law. This Mortgage will be governed by, construed and
enforced in accordance with federal law and the laws of the State of
Wisconsin. This Mortgage has been accepted by Lender in the State of
Wisconsin.
No Wavier by Lender. Lender shall not be deemed to have waived any
rights under this Mortgage unless such waiver is given in writing and
signed by Lender. No delay or omission on the part of Lender in
exercising any right shall operate as a waiver of such right or any
other right. A waiver by Lender of a provision of this Mortgage shall
not prejudice or constitute a waiver of Lender's right otherwise to
demand strict compliance with that provision or any other provision of
this Mortgage. No prior waiver by Lender, nor any course of dealing
between Lender and Grantor, shall constitute a waiver of any of
Lender's rights or of any of Grantor's obligations as to any future
transactions. Whenever the consent of Lender is required under this
Mortgage, the granting of such consent by Lender in any instance shall
not constitute continuing consent to subsequent instances where such
consent is required and in all cases such consent may be granted or
withheld in the sole discretion of Lender.
Severability. If a court of competent jurisdiction finds any provision
of this Mortgage to be illegal, invalid, or unenforceable as to any
circumstance, that finding shall not make the offending provision
illegal, invalid, or unenforceable as to any other circumstance. If
feasible, the offending provision shall be considered modified so that
it becomes legal, valid and enforceable. If the offending provision
cannot be so modified, it shall be considered deleted from this
Mortgage. Unless otherwise required by law, the illegality, invalidity,
or unenforceability of any provision of this Mortgage shall not affect
the legality, validity or enforceability of any other provision of this
Mortgage.
Merger. There shall be no merger of the interest or estate created by
this Mortgage with any other interest or estate in the Property at any
time held by or for the benefit of Lender in any capacity, without the
written consent of Lender.
Successors and Assigns. Subject to any limitations stated in this
Mortgage on transfer of Grantor's interest, this Mortgage shall be
binding upon and inure to the benefit of the parties, their successors
and assigns. If ownership of the Property becomes vested in a person
other than Grantor, Lender, without notice to Grantor, may deal with
Grantor's successors with reference to this Mortgage and the
indebtedness by way of forbearance or extension without releasing
Grantor from the obligations of this Mortgage or liability under the
indebtedness.
Time is of the Essence. Time is of the essence in the performance of
this Mortgage.
DEFINITIONS. The following capitalized words and terms shall have the following
meanings when used in this Mortgage. Unless specifically stated to the contrary,
all references to dollar amounts shall mean amounts in lawful money of the
United States of America. Words and terms used in the singular shall include the
plural, and the plural shall include the singular, as the context may require.
Words and terms not otherwise defined in this Mortgage shall have the meanings
attributed to such terms in the Uniform Commercial Code:
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Borrower. The word "Borrower" means BADGER PAPER MILLS, INC., and all
other persons and entities signing the Note in whatever capacity.
Default. The word "Default" means the Default set forth in this
Mortgage in the section titled "Default".
Environmental Laws. The words "Environmental Laws" mean any and all
state, federal and local statutes, regulations and ordinances relating
to the protection of human health or the environment, including without
limitation the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, 42 U.S.C. Section 9801, et seq.
("CERCLA"), the Superfund Amendments and Reauthorization Act of 1986,
Pub. L. No. 99-499 ("SARA"), the Hazardous Materials Transportation
Act, 49 U.S.C. Section 1601, et seq., the Resource Conservation and
Recovery Act, 42 U.S.C. Section 8901, et seq., or other applicable
state or federal laws, rules or regulations adopted pursuant thereto.
Event of Default. The words "Event of Default" mean any of the events
of default set forth in this Mortgage in the events of default section
of this Mortgage.
Grantor. The word "Grantor" means BADGER PAPER MILLS, INC.
Guaranty. The word "Guaranty" means the guaranty from guarantor,
endorser, surety, or accommodation party to Lender, including without
limitation a guaranty of all or part of the Note.
Hazardous Substances. The words "Hazardous Substances" means materials
that, because of their quantity, concentration or physical, chemical or
infectious characteristics, may cause or pose a present or potential
hazard to human health or the environment when improperly used,
treated, stored, disposed of, generated, manufactured, transported or
otherwise handled. The words "Hazardous Substances" are used in their
very broadest sense and include without limitation any and all
hazardous or toxic substances, materials or waste as defined by or
listed under the Environmental Laws. The term "Hazardous Substances"
also includes, without limitation, petroleum and petroleum by-products
or any fraction thereof and asbestos.
Improvements. The word "Improvements" means all existing and future
improvements, buildings, structures, mobile homes affixed on the Real
Property, facilities, additions, replacements and other construction on
the Real Property.
Indebtedness. The word "Indebtedness" means all principal, interest,
and other amounts, costs and expenses payable under the Note or Related
Documents, together with all renewals of, extensions of, modifications
of, consolidations of and substitutions for the Note or Related
Documents and any amounts expended or advanced by Lender to discharge
Grantor's
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obligations or expenses incurred by Lender to enforce Grantor's
obligations under this Mortgage, together with interest on such amounts
as provided in this Mortgage.
Lender. The word "Lender" means WISCONSIN COMMUNITY BANK, its
successors and assigns.
Mortgage. The word "Mortgage" means this Mortgage between Grantor and
Lender.
Note. The word "Note" means the promissory note dated September 19,
2002, in the original principal amount of $2,000,000.00 from Grantor to
Lender, together with all renewals of, extensions of, modifications of,
refinancings of, consolidations of, and substitutions for the
promissory note or agreement.
Personal Property. The words "Personal Property" mean all equipment,
fixtures, and other articles of personal property now or hereafter
owned by Grantor, and now or hereafter attached or affixed to the Real
Property; together with all accessions, parts, and additions to, all
replacements of, and all substitutions for, any of such property; and
together with all proceeds (including without limitation all insurance
proceeds and refunds of premiums) from any sale or other disposition of
the Property.
Property. The word "Property" means collectively the Real Property and
the Personal Property.
Real Property. The words "Real Property" mean the real property,
interests and rights, as further described in this Mortgage.
Related Documents. The words "Related Documents" mean all promissory
notes, credit agreements, loan agreements, environmental agreements,
guaranties, security agreements, mortgages, deeds of trust, security
deeds, collateral mortgages, and all other instruments, agreements and
documents, whether now or hereafter existing, executed in connection
with the indebtedness.
Rents. The word "Rents" means all present and future rents, revenues,
income, issues, royalties, profits, and other benefits derived from the
Property.
GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS MORTGAGE, AND
GRANTOR AGREES TO ITS TERMS.
GRANTOR:
BADGER PAPER MILLS, INC.
By: /s/ William H. Peters
--------------------------
WILLIAM H. PETERS, CFO, VP and Secretary of BADGER PAPER MILLS, INC.
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This Mortgage prepared by: x /s/ Kevin S. Tenpas
------------------------------
Name of Signer: KEVIN S. TENPAS, PRESIDENT
Complete either Authentication Section or Acknowledgement Section
AUTHENTICATION
Signature(s) of BADGER PAPER MILLS, INC. authenticated this _____ day of
________, 20__.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Title: Member State Bar of Wisconsin or _______________________________________
authorized under Section 706.06, Wis. Stats.
CORPORATE ACKNOWLEDGEMENT
STATE OF WISCONSIN )
) SS
COUNTY OF BROWN )
On this 19th day of September, 2002, before me, the undersigned Notary Public,
personally appeared WILLIAM H. PETERS, CFO, VP and Secretary of BADGER PAPER
MILLS, INC., and known to me to be an authorized agent of the corporation that
executed the Mortgage and acknowledged the Mortgage to be the free and voluntary
act and deed of the corporation, by authority of its Bylaws or by resolution of
its board of directors, for the uses and purposes therein mentioned, and on oath
stated that he or she is authorized to execute this Mortgage and in fact
executed the Mortgage on behalf of the corporation.
By: /s/ Wenda M. Roycraft Residing at De Pere, WI
-----------------------------
Wenda Roycraft
Notary Public in and for the State of WI My commission expires 11/28/04
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