10060
MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FINANCING STATEMENT
THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND
FINANCING STATEMENT, made and entered into as of the 15th day of July, 1994, by
and among BLUE VALLEY BUILDING CORP., a Kansas corporation ("Borrower"), with an
address at P.O. Box 26128, Overland Park, Kansas 66225, as mortgagor, and
BUSINESS MEN'S ASSURANCE COMPANY OF AMERICA, a Missouri corporation ("Lender"),
with an address at c/o Charter American Mortgage Company, 2001 Shawnee Mission
Parkway, Mission Hills, Kansas 66205, as mortgagee (hereinafter, this
"Mortgage").
WITNESSETH, THAT in consideration of Lender's agreement to make a loan to
Borrower in the original principal amount of Two Million Five Hundred Thousand
Dollars ($2,500,000.00) (the "Loan" and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Borrower hereby
warrants, represents, covenants and agrees as follows:
ARTICLE I
Granting Clauses
Section 1.01. Grant of Real Estate Security. Borrower hereby irrevocably
grants, bargains, sells, mortgages, warrants, transfers, convoys, assigns, sets
over and pledges to Lender all of the following described property (the
"Mortgaged Estate"):
(a) The real property located in the City of Overland Park, County of
Johnson, State of Kansas, described on Exhibit A, attached hereto and
incorporated herein, and all and singular the tenements, hereditaments and
appurtenances thereto, together with all right, title and interest of Borrower
in all easements, rights-of-way, gores or strips of land, surface waters, ground
waters, watercourses, mineral interests and subsurface rights, alleys, streets
and sidewalks, whether now owned or hereafter acquired, either in law or in
equity, adjacent or appurtenant to or adjoining such real property (the "Land");
(b) Any and all buildings and improvements now or hereafter erected or
located on the Land, including all fixtures, attachments, appliances, equipment,
machinery and other articles attached to such buildings and improvements (the
"Improvements");
(c) All right, title and interest of Borrower in and to all tangible
personal property now owned or hereafter acquired by Borrower and now or at any
time hereafter located on the Land or within the Improvements and used in
connection therewith, including all building materials stored on the Land, all
machinery, motors, elevators, fittings, radiators, awnings, shades, screens, all
plumbing, heating, lighting, ventilating, refrigerating, incinerating, air
conditioning and sprinkler equipment, all furniture, furnishings, equipment and
other personal property owned by Borrower and attached to or otherwise forming a
part of the Land or Improvements, and used in connection with the operation of
the Mortgaged Estate, and all renewals and replacements
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thereof (excluding any such property owned by a tenant of the Mortgaged Estate)
(the "Personal Property"), all of which property shall, so far as permitted by
law, be deemed to form a part and parcel of the real property and for the
purpose of this Mortgage to be real estate and covered by this Mortgage;
(d) All of Borrower's interest in all existing and future accounts,
contract rights, general intangibles, files, books of account, agreements,
permits, licenses and certificates necessary or desirable in connection with the
acquisition, ownership, leasing, operation or management of the Mortgaged
Estate, whether now existing or entered into or obtained after the date hereof,
including the "Leases" and "Rents" (as defined herein);
(e) All agreements for use and occupancy of any part of the Mortgaged
Estate, now existing or hereafter entered into, including any and all extensions
or modifications thereto (the "Leases"), and all of the rents, royalties,
security deposits, income, receipts, revenues and other sums now due or which
may hereafter become due to Borrower under any Lease or arising from the use and
enjoyment of any part of the Mortgaged Estate, and all rights and remedies which
Borrower may have against any party under the Leases (the "Rents"); and
(f) All the estate, interest, right, title or other claim or demand with
respect to the proceeds of insurance and any and all awards made for the taking
of any part of the Mortgaged Estate by the power of eminent domain, or by any
proceeding or purchase in lieu thereof.
TO HAVE AND TO HOLD the Mortgaged Estate unto Lender and its successors
and assigns, forever.
Section 1.02. Grant of Security Interest. With respect to any portion of
the Mortgaged Estate which constitutes Personal Property, fixtures or other
property or interests governed by the Uniform Commercial Code of the state in
which the Mortgaged Estate is located (the "UCC"), this Mortgage shall
constitute a security agreement between Borrower, as the debtor, and Lender, as
the secured party, and Borrower hereby grants to Lender a security interest in
such portion of the Mortgaged Estate. Borrower agrees to execute and deliver to
Lender all financing and continuation statements and other information which are
from time to time required to establish and maintain the validity and priority
of the security interests herein granted. Upon the occurrence of an "Event of
Default" (as defined herein), Lender shall have all of the rights and remedies
of a secured party available under the UCC with respect to the property
encumbered by the security interests; provided, however, Lender may, at its
option, dispose of such property in accordance with Lender's rights and remedies
under this Mortgage, in lieu of proceeding under the UCC. Borrower hereby
appoints Lender as its attorney-in-fact to execute, deliver and file any and all
required financing statements, continuation statements and other instruments as
Lender may require in order to perfect and maintain the security interests
granted herein.
Section 1.03. Assignment of Leases and Rents. Borrower hereby assigns and
transfers to Lender all of the Leases and Rents. The terms of such assignment
are more specifically set forth in the separate Assignment of Leases and Rents
dated as of the date hereof, executed by Borrower in favor of Lender and
recorded simultaneously with this Mortgage, the terms of which Assignment of
Leases and Rents are specifically incorporated herein by this reference.
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Section 1.04. Secured Obligations. (a) This Mortgage shall secure the
following indebtedness and obligations, including all replacements, renewals,
amendments, extensions, substitutions and modifications thereof:
(1) Payment of all indebtedness and performance of all obligations
and covenants of Borrower under or pursuant to (i) the Promissory Note
dated as of the date hereof, executed by Borrower in favor of Lender in
the aggregate principal amount of the Loan (the "Note"); (ii) this
Mortgage; (iii) the Assignment of Leases and Rents; (iv) Environmental
Indemnity Agreement dated as of the date hereof between Borrower and
Lender (the "Environmental Indemnity"); and (v) all other "Loan Documents"
(as defined herein); and
(2) Payment of all future advances and all sums advanced by Lender
to protect the Mortgaged Estate or otherwise pursuant to the terms of the
Loan Documents, with interest on all of the foregoing at the "Default
Rate" (as defined in the Note) from the date of Lender's advance to the
date of Borrower's repayment of same.
(b) The indebtedness and the obligations secured by this Mortgage which
are described in paragraph (a) above are hereinafter referred to as the "Secured
Obligations."
(c) This Mortgage, the Note, the Assignment of Leases and Rents, the
Environmental Indemnity, that certain loan commitment letter dated March 1,
1994, as amended, between Lender and Borrower, and any other writing or
instrument given to evidence or secure the payment of performance of any of the
Secured Obligations are hereinafter collectively referred to as the "Loan
Documents."
ARTICLE II
Payment and Performance
Section 2.01. Payment of Secured Obligations. Borrower shall pay all sums
due under the Loan Documents without offset, counterclaim or defense, as and
when the same shall become due. Borrower shall fully and faithfully observe and
perform all of the obligations of Borrower to be observed and performed under
the Loan Documents.
Section 2.02. Warranty of Title. Borrower warrants and represents that: (i)
Borrower has good and marketable title to an indefeasible estate in fee simple
in the Land and improvements; (ii) Borrower has good and marketable title to all
of the rest of the Mortgaged Estate; and (iii) such title of Borrower is free
and clear of any liens or encumbrances except as set forth in Exhibit B,
attached hereto and incorporated herein (the "Permitted Encumbrances"). Borrower
shall preserve Borrower's title and interest in the Mortgaged Estate and will
forever warrant and defend the validity and priority of the lien, security
interest and assignments created herein against the claims of all persons
whomsoever, subject only to the Permitted Encumbrances.
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ARTICLE III
Taxes and Insurance
Section 3.01. Taxes. Borrower shall pay when due and before any penalty
attaches or interest accrues, all general taxes, special taxes, assessments,
water charges, sewer service charges, and other similar charges against or
affecting the Mortgaged Estate or any property or equipment located on the Land,
or which might become a lien upon the Mortgaged Estate (the "Taxes"). If any Tax
may be legally paid in installments, Borrower shall have the right, at its
option, to pay such Tax in installments.
Section 3.02. Insurance. (a) Borrower shall at all times keep in full
force and effect the following policies of insurance with respect to the
Mortgaged Estate: (i) comprehensive general public liability insurance in an
amount of not less than $1,000,000, combined single limit coverage for injury to
persons and damage to property, with a deductible limit satisfactory to Lender;
(ii) standard fire and extended coverage casualty insurance, with vandalism and
malicious mischief coverage and so called "all risks" or "DIC" coverage in the
amount of the full insurable value of the Mortgaged Estate on a replacement cost
basis (but in any event not less than the amount of the Loan); (iii) loss of
rents or business interruption insurance covering all Rents for a period of one
(1) year; and (iv) such other policies of insurance as Lender may from time to
time require.
(b) All insurance policies shall: (i) be issued by a company or
companies rated "A" or better by A.M. Best & Company and otherwise
satisfactory to Lender; (ii) shall name Lender as an additional insured
and loss payee; and (iii) shall provide a minimum of thirty (30) days'
written notice to Lender prior to the expiration or any cancellation or
modification of such policies. Borrower shall provide Lender with
certificates evidencing all required insurance. In the event Borrower
shall fail to maintain the insurance required by this section, Lender may,
but shall not be so obligated, to procure such insurance as Lender shall
deem necessary, and any amount so expended by Lender shall be secured by
this Mortgage and be repayable by Borrower upon demand, with interest at
the "Default Rate" (as defined in the Note.)
(c) In the event of any damage or destruction to the Mortgaged
Estate, Borrower shall promptly make proof of loss to the insurers, and
Borrower shall not adjust or compromise any claim under such insurance
without the prior written approval of Lender. All proceeds of such
insurance shall be paid directly to Lender, and each insurer is hereby
authorized and directed to make such payment directly to Lender. Any
proceeds shall be applied first to the payment of all costs and expenses
incurred by Lender in obtaining such proceeds. The balance of the
proceeds, if any, may be applied at the option of the Lender fill against
the Secured Obligations, without prepayment premium, or (ii) to the
restoration or the repair of the Mortgaged Estate, in such order as Lender
may elect, in its sole discretion. If Lender elects to apply the insurance
proceeds to restoration or repair of the Mortgaged Estate, Lender shall
have the right to establish requirements for the disbursement of such
proceeds as may be imposed by responsible mortgagees or holders of deeds
of trust for advances of proceeds of commercial construction loans in the
state in which the Mortgaged Estate is located.
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Section 3.03. Tax and Insurance Escrow. On the first day of each calendar
month, Borrower shall deposit with Lender or Lender's designated agent an amount
equal to one-twelfth (1/12) of the estimated aggregate annual insurance premiums
and Tax payments for the Mortgaged Estate. Such deposits shall be non-interest
bearing and are hereby pledged as additional security for the Secured
Obligations. Upon receipt of bills, statements or other evidence of insurance
premiums or Taxes due, Lender shall pay or cause to be paid such amounts out of
the funds so deposited. If at any time such funds are insufficient to pay such
amounts, Borrower shall immediately deposit an amount equal to the deficiency.
Lender shall not be deemed a trustee of such funds or to be obligated to expend
any amount in excess of such funds under this Section. If Borrower fails to
deposit sufficient sums as required, Lender may, but shall not be so obligated,
advance any amounts required to make up the deficiency, which advances shall be
secured by this Mortgage and be repayable by Borrower upon demand, with interest
at the Default Rate.
ARTICLE IV
Maintenance: Alterations: Inspections
Section 4.01. Maintenance. Borrower shall: (i) maintain the Mortgaged
Estate in good condition and repair, subject to ordinary wear and tear; (ii) not
commit or suffer to be committed any waste of the Mortgaged Estate; (iii) comply
with all laws, ordinances, regulations and restrictions now or hereafter
affecting the Mortgaged Estate; and (iv) not do or permit to be done any act
which would otherwise diminish the value of the Mortgaged Estate.
Section 4.02. Alterations. Borrower shall not remove, demolish or alter
any of the Improvements without the prior written approval of Lender; provided,
however, that Borrower may make interior, nonstructural alterations in an amount
not to exceed $1,000,000.00 in each calendar year. Borrower shall complete any
construction or alteration of the Mortgaged Estate in a good and workmanlike
manner.
Section 4.03. Inspections. Lender shall have the right at any time, upon
reasonable prior notice to Borrower, to enter upon the Mortgaged Estate for the
purpose of inspecting the same or to exercise any of its rights and remedies
under the Loan Documents.
ARTICLE V
Eminent Domain
Section 5.01. Eminent Domain. If all or any part of the Mortgaged Estate
is taken or damaged by the exercise of the power of eminent domain or a
conveyance in lieu thereof (a "Condemnation"), or should Borrower receive any
notice or other information regarding any such proceeding, Borrower shall give
prompt written notice thereof to Lender. Lender may participate in Condemnation
proceedings, and Borrower shall consult with Lender and its attorneys and
cooperate with them in the carrying on or defense of any such proceedings. All
proceeds of Condemnation awards or sales in lieu thereof, and all judgments,
decrees and awards for injury or damage to the Mortgaged Estate shall be paid to
Lender and shall be applied first to all costs and expenses incurred by Lender
in obtaining the proceeds. The balance of the
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proceeds, if any, may be applied at the option of Lender (i) against the Secured
Obligations, without prepayment premium or (ii) to the restoration or repair of
the Mortgaged Estate, in such order as Lender may elect, in its sole discretion.
Lender shall not be liable or responsible for failure to collect or exercise
diligence in the collection of any proceeds, judgments, decrees or awards.
ARTICLE VI
Events Of Default: Remedies
Section 6.01. Events of Default. Each of the following shall be an
"Event of Default" under this Mortgage:
(a) Failure of Borrower to make any payment of principal or interest
or any other payment under the Note or any other sum secured under any
Loan Document within ten (10) days of the date such payment shall be due
and payable (calculated by including the due date);
(b) Failure by Borrower to perform or observe any other covenant or
agreement set forth in this Mortgage, and the continuance of such default
for thirty (30) days after notice thereof from Lender specifying such
default;
(c) The occurrence of a default or an "Event of Default" under
any Loan Document other than this Mortgage;
(d) Any suit or proceeding shall be filed against Borrower or any
guarantor of Borrower under any Loan Document which, if adversely
determined, could materially impair the ability of Borrower or such
guarantor to perform any of its obligations under any Loan Document, in
the opinion of Lender, in its sole discretion;
(e) Any representation, warranty or statement made by Borrower, any
guarantor or other party under any Loan Document or any other affidavit or
instrument executed or delivered with respect to the Loan shall be
determined by Lender to be false or misleading in any material respect;
(f) Borrower shall convey, alienate, transfer, mortgage, encumber,
lease or assign ownership or control of all or any part of the Mortgaged
Estate or any interest therein, whether legal or equitable, or in
Borrower, in violation of Section 7.01 hereof, or Borrower shall be
divested of its title or any interest in the Mortgaged Estate in any
manner, whether voluntarily or involuntarily, or if there is any merger,
consolidation or dissolution affecting Borrower;
(g) Borrower (i) shall execute an assignment for the benefit of
creditors or an admission in writing of Borrower's inability or failure to
pay debts generally as they become due; or (ii) shall allow the levy
against the Mortgaged Estate or any part thereof of any execution,
attachment, sequestration or other writ or action which is not vacated or
discharged within sixty (60) days after such levy; or (iii) shall allow
the appointment of a
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receiver, trustee or custodian of Borrower or the Mortgaged Estate or any
part thereof which receiver, trustee or custodian is not discharged within
sixty (60) days after such appointment; or (iv) shall file as a debtor a
petition, case, proceeding or other action pursuant to, or voluntarily
seeks the benefit or benefits of, any law granting relief to any debtor, or
takes any action in furtherance thereof; or (v) shall file a petition,
complaint, answer or other instrument which seeks to effect a suspension
of, or which has the effect of suspending, any of the rights or powers of
Lender granted under any Loan Document; or (vi) shall allow the filing of a
petition, case, proceeding or other action against Borrower as a debtor
under any law granting relief to a debtor, or shall seek or allow
appointment of a receiver, trustee, custodian or liquidator of Borrower or
of the Mortgaged Estate, or any part thereof, or of any significant portion
of Borrower's other property; and (x) Borrower shall admit, acquiesce in or
fail to contest diligently the allegations thereof, or (y) such petition,
case, proceeding or other action shall result in the entry of an order for
relief or order granting the relief sought against Borrower, or (z) such
petition, case, proceeding or other action is not permanently dismissed or
discharged on or before the earlier of trial thereon or sixty (60) days
following the date of filing.
(h) The occurrence of any event described in paragraph (g) above
with respect to any guarantor of the Secured Obligations or any other
person or entity obligated in any manner to pay or perform the Secured
Obligations.
Section 6.02. Remedies. Upon the occurrence of an Event of Default,
Lender shall have the right to take any one or more of the following actions:
(a) Declare all Secured Obligations to be due and payable, and the
same shall thereupon become due and payable without any presentment,
demand, protest or notice of any kind except as otherwise provided herein,
and Borrower hereby waives notice of intent to accelerate the Secured
Obligations;
(b) Commence an action to foreclose this Mortgage, appoint a
receiver or specifically enforce any of the covenants of this Mortgage;
(c) Exercise any or all of the remedies available to a secured
party under the UCC;
(d) Either in person or by agent, with or without bringing any
action or proceeding, or by a receiver appointed by a court, and without
regard to the adequacy of its security, enter upon and take possession of
the Mortgaged Estate or any part thereof and do any acts which it deems
necessary or desirable to protect and preserve Lender's security;
(e) Without notice to Borrower or anyone claiming under Borrower,
and without regard to the value of the Mortgaged Estate, to apply to any
court having jurisdiction to appoint a receiver or receivers of the
Mortgaged Estate, and Borrower hereby irrevocably consents to such
appointment and waives notice of any application therefore. Any such
receiver or receivers shall have all of the usual powers and duties of
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receivers in like or similar cases and all powers and duties of Lender in
case of entry as provided in Section 6.05.
(f) If Lender shall exercise its right to declare all Secured
Obligations to be due and payable, then in addition to such Secured
Obligations, Borrower shall pay Lender a reinvestment fee which shall be
equal to ten percent (10%) of the outstanding principal balance of the
Note during the first three (3) "Loan Years" (as defined in the Note) and
thereafter in accordance with the prepayment charge set forth in the Note.
Section 6.03. Remedies Not Exclusive; No Waiver. Every power or remedy
given Lender by any of the Loan Documents, or to which Lender may be otherwise
entitled, may be exercised without prejudice to any other power or remedy,
concurrently, independently, in any order or any manner from time to time and as
often as may be deemed expedient by Lender. No remedy or power is intended to be
exclusive of any other remedy or power, and Lender may pursue inconsistent
remedies. The acceptance by Lender of the payment or performance of any Secured
Obligation after the same shall be due shall not constitute a waiver of Lender's
right to the prompt payment or performance of same, or to declare a default as
herein provided. The acceptance by Lender of any sum in an amount less than the
sum then due shall not constitute a waiver of Borrower's obligation to pay the
entire sum, and such failure shall continue to be a default by Borrower
notwithstanding Lender's acceptance of such partial payment. Consent by Lender
to any action or inaction of Borrower which is subject to consent or approval
shall not be deemed a waiver of any other or future right of Lender to consent
under this Mortgage. Nothing set forth in this Mortgage shall be construed to
constitute Lender as a "mortgagee in possession" in the absence of its actual
taking possession of the Mortgaged Estate pursuant to the powers granted herein.
Section 6.04. Waivers. To the extent permitted by law, Borrower hereby
agrees that it shall not at any time insist upon, plead, claim or take any
benefit or advantage, in any way whatsoever, whether now or in the future, and
Borrower hereby irrevocably waives, all of the following, whether the same
exists under federal or state law, or otherwise at law or in equity:
(a) Any right of redemption of any of the Mortgaged Estate
after sale under this Mortgage;
(b) All rights and claims it may have in or to any of the
Mortgaged Estate as a "homestead exemption," or similar exemptions;
(c) Any stay, extension or moratorium law which may extend the
period for enforcement of this Mortgage or any period of redemption;
(d) Any and all right to require the marshalling of assets in
connection with the exercise of any of Lender's remedies under this
Mortgage, it being agreed that Lender shall have the right to determine,
in its sole discretion, the order in which any of the Mortgaged Estate
shall be sold, or the order in which any Secured Obligations are satisfied
from the proceeds of such sale;
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(e) Any right to trial by jury in any action, proceeding or
counterclaim brought by any party against any other party on any matter
arising out of or in any way connected with this Mortgage or the Loan
Documents, the relationship between Borrower and Lender, or Borrower's use
and occupancy of the Mortgaged Estate;
(f) Any law providing for the valuation or appraisal of all or any
part of the Mortgaged Estate prior to or after any sale or sales made
pursuant to this Mortgage;
(g) Personal service of process in any action or proceeding at any
time commenced to enforce this Mortgage or any of the Loan Documents,
Borrower hereby agreeing that such process shall be deemed properly and
adequately served if sent to Borrower as provided in Section 7.03 of this
Mortgage;
(h) All notices not herein specifically required of Borrower's
default under any of the Loan Documents, or of Lender's exercise, or
election to exercise, any right, option or election under this Mortgage;
and
(i) Any and all technical or procedural errors, defects and
imperfections in any of the Loan Documents or any proceedings instituted
by Lender under this Mortgage.
Section 6.05. Preservation of Security. Notwithstanding the provisions of
this Article VI, and in addition to any other rights or remedies of Borrower
under this Mortgage, should Borrower at any time fail to make any payment or
perform any obligation under any Loan Document, Lender, in its sole discretion,
without obligation to do so and without notice to or demand upon Borrower, and
without releasing Borrower from any Secured Obligation or waiving any of
Lender's rights under the Loan Documents, may cure such default of Borrower in
such manner and to such extent as Lender may deem necessary to protect the
security of this Mortgage. In connection therewith, without limiting its general
powers, Lender shall have and is hereby given the right, but not the obligation:
(a) To enter upon and take possession of the Mortgaged Estate;
(b) To direct Borrower to terminate any management agent and
employ such management agent as Lender may determine;
(c) To make additions, alterations, repairs and improvements to the
Mortgaged Estate which Lender may consider necessary or proper to keep the
Mortgaged Estate in good condition and repair;
(d) To appear and participate in any action or proceeding
affecting or which may affect the security hereof or the rights or
powers of Lender;
(e) To pay, purchase, contest or compromise any encumbrance, claim,
charge, lien or debt which in the judgment of Lender may effect the
security of this Mortgage or be prior or superior hereto; and
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(f) In exercising such powers, to pay necessary expenses, including
employment of counsel or other necessary or desirable consultants.
All costs and expenses incurred by Lender in connection with the exercise of the
foregoing rights, including costs of evidence of title, court costs, appraisals,
surveys and attorneys' fees, shall be secured by this Mortgage and be repayable
by Borrower upon demand, with interest at the Default Rate.
ARTICLE VII
General Covenants
Section 7.01. Prohibition On Transfer. Borrower shall not, by operation of
law or otherwise, sell, convey, alienate, transfer, mortgage, encumber, lease or
assign ownership or control, or permit the same, of all or any part of the
Mortgaged Estate or any interest therein, whether legal or equitable (including
rents, issues or profits arising therefrom), or of a controlling interest in
Borrower, Blue Valley BanCorp or Bank of Blue Valley (including any general or
limited partnership interests, shares of stock or any other equity, beneficial
or ownership interest in Borrower) without the prior written approval of Lender,
in its sole discretion. Lender may withhold its approval for any reason or
Lender may condition its approval upon an increase in the interest rate under
the Note and/or the payment of a fee. Notwithstanding the foregoing, such
approval of Lender shall not be required for any such transfer by devise or
descent, or for the grant of a leasehold interest in the Mortgaged Estate of ten
(10) years or less upon then current market terms.
Section 7.02. Compliance With Laws. Borrower shall promptly comply with
all present and future federal, state and local laws, statutes and ordinances,
and all covenants and restrictions of record affecting the Mortgaged Estate,
including (i) the Occupational Safety and Health Act (OSHA) 29 U.S.C. ss. 651,
and the Americans with Disabilities Act ("ADA) 42 U.S.C. ss. 12101. Borrower
shall not initiate or acquiesce in any zoning reclassification or material
change in the zoning affecting the Mortgaged Estate without the prior written
approval of Lender.
Section 7.03. Notices. All notices, approvals or communications required
or permitted to be given under this Mortgage shall be in writing and shall be
deemed to have been properly given and received (i) if sent by hand delivery,
then upon delivery, (ii) if sent by overnight courier or U.S. Express Mail, then
one (1) day after dispatch, and (iii) if mailed by registered or certified U.S.
mail, postage prepaid and return receipt requested, then one (1) day after
deposit in the mail. All such notices and communications shall be given (x) to
Lender at its address set forth in this Mortgage, and (y) to Borrower at its
address set forth in this Mortgage, Attn: Robert D. Regnier (with a copy to
Buck, Bohm & Stein, 4601 College Boulevard, Suite 200, Leawood, Kansas
66211-1650), or at such other addresses as either party may designate by notice
in accordance with the terms of this Section.
Section 7.04. Legal Existence. If Borrower is a corporation, partnership
or other entity, Borrower shall preserve and keep in full force and effect its
legal existence and all franchises,
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rights and privileges under the laws of the state of its incorporation or
formation and its standing and/or qualification to do business in the state in
which the Mortgaged Estate is located.
Section 7.05. Liens. Borrower shall not create, permit to accrue or suffer
to exist upon any of the Mortgaged Estate, any security interest, judgment lien,
mechanic's or materialman's lien, or any other lien, encumbrance, charge,
retention or reservation of title, as security, pledge, hypothecation or
assignment as security, and shall promptly pay, when the same shall become due,
all claims and demands of contractors, subcontractors, mechanics, materialmen,
laborers and others which claims, if unpaid, might result in or permit the
creation of a lien upon the Mortgaged Estate, and Borrower shall cause any such
lien to be promptly paid and discharged, whether by payment, bonding or
otherwise, within thirty (30) days after the filing of same.
Section 7.06. Financial Statements. Borrower shall deliver to Lender, with
reasonable promptness (and any event within 150 days after the close of
Borrower's fiscal year): (i) an income and expense statement with respect to the
operation of the Mortgaged Estate for the immediately preceding fiscal year of
Borrower, and (ii) a balance sheet and statement of profit and loss of Borrower
for the immediately preceding fiscal year of Borrower. Each such operating and
expense statement and financial statement shall be certified by the general
partner or chief financial officer of Borrower, and shall be prepared in
accordance with generally accepted accounting principles. Borrower shall also
provide Lender with such additional information or records relating to the
Mortgaged Estate or Borrower's financial condition as Lender may from time to
time request. Upon request of Lender, Borrower shall furnish financial
statements from major tenants under any Leases.
Section 7.07. Successors. The terms and provisions of this Mortgage, and
the rights and obligations of Borrower and Lender, shall inure to the benefit of
and be binding upon Borrower and Lender and their successors and assigns.
Section 7.08. Governing Law. This Mortgage shall be governed by and
construed in accordance with the laws of the state in which the Mortgaged
Estate is located.
Section 7.09. Release of Mortgage. Upon payment and performance in full of
all of the Secured Obligations, Lender shall, upon demand of Borrower but in no
event later than the time prescribed by applicable law, release the Mortgaged
Estate from the lien of this Mortgage and shall furnish Borrower with a properly
executed and recordable instrument evidencing such release.
Section 7.10. Estoppel Certificate. Within twenty (20) days after request
by Lender, Borrower shall furnish Lender a duly acknowledged written statement,
in form satisfactory to Lender, setting forth the amount of principal and
interest then owing under the Note, any other charges payable under any Loan
Documents, and stating whether any offsets or defenses exist to the indebtedness
secured hereby.
Section 7.11. Lender's Approval. In any instance under this Mortgage in
which Lender's approval shall be required, such approval may be given or
withheld by Lender in Lender's sole discretion, and shall be final and
conclusive. The granting of any approval by Lender shall not be
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deemed a waiver of such right of approval to any future matter, and all
approvals by Lender must be in writing.
Section 7.12. Severability. If any term or provision of this Mortgage or
the application thereof to any person or circumstance shall, to any extent, be
held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision hereof or
any other circumstance or situation with respect to this Mortgage, and each
remaining term and provision of this Mortgage shall be valid and be enforced to
the fullest extent by law.
Section 7.13. Limited Liability. The liability of Borrower for the
repayment of the indebtedness evidenced by the Note and the performance of the
Secured Obligations shall be limited to the security given by Borrower and other
parties for the Note and other Secured Obligations. Notwithstanding anything to
the contrary contained herein, and notwithstanding any delay by Lender in
exercising any right, remedy or privilege under any Loan Document, Borrower
shall be personally liable beyond its interest in the security granted to Lender
to the extent of: (i) any funds received by Borrower or any other person or
entity for or on account of Borrower as security deposits under any Leases; (ii)
any Rents received or held by Borrower after the occurrence of an Event of
Default or any Rents received by Borrower which are prepaid more than one month
in advance; (iii) all condemnation awards and payments and insurance proceeds
received by Borrower that have not been applied as required by the terms of the
Loan Documents; (iv) the cost to repair the Mortgaged Estate as a result of a
casualty not reimbursed by insurance to the extent that such insurance is
required by the terms of the Loan Documents; (v) any liability, damage, cost or
expense (including attorneys' fees) incurred by Lender as a result of any fraud,
misrepresentation or bad faith by Borrower or any Guarantor; (vi) any liability,
damage, cost or expense (including attorneys' fees) incurred by Lender under the
terms of the Environmental Indemnity; (vii) any liability, damage, cost or
expense (including attorneys' fees) incurred by Lender due to any waste of the
Mortgaged Estate by Borrower or Borrower's representatives or tenants; and
(viii) any failure to pay delinquent Taxes. Nothing contained herein shall limit
or affect Lender's rights under any guaranty or other collateral which may now
or hereafter be given in connection with the Note.
ARTICLE VIII
Environmental Indemnity
Section 8.01. Hazardous Substances. Borrower shall not generate, store,
use or dispose, or permit the generation, storage, use or disposal of, any
"Hazardous Substance" (as defined in the Environmental Indemnity) on or about
the Mortgaged Estate, unless: (i) the Hazardous Substance is used in minor
amounts in the ordinary course of business of Borrower or tenants; (ii) the
Hazardous Substance is used in full compliance with all applicable
"Environmental Requirements" (as defined in the Environmental Indemnity); and
(iii) the proposed presence and use of such Hazardous Substance is specifically
disclosed to Lender and has been approved in writing, in advance by Lender.
Borrower shall promptly notify Lender of any violation or suspected or alleged
violation of any Environmental Requirements on or about the Mortgaged Estate of
which Borrower becomes aware.
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Section 8.02. Indemnity. Borrower shall indemnify, defend and save and
hold harmless Lender from and against any and all losses, liabilities, damages,
costs and expenses (including costs of remediation or cleanup, loss of property
value or defects in title to the Mortgaged Estate, and the reasonable fees and
disbursements of Lender's counsel) asserted against or suffered or incurred by
Lender and in any way relating to or arising out of the generation, storage,
manufacturing, refining, releasing, transportation, treatment, disposal or other
presence of any Hazardous Substance on or about or removed from the Mortgaged
Estate, which indemnity shall survive: (i) the foreclosure of this Mortgage;
(ii) any conveyance of the Mortgaged Estate in lieu of such foreclosure; (iii)
the payment and performance of the Secured Obligations, (iv) the release of the
lien of this Mortgage; and (v) any other transfer of Borrower's title to or
interest in the Mortgaged Estate. The terms and provisions of the Environmental
Indemnity are specifically incorporated into this Article VIII and made a part
hereof.
IN WITNESS WHEREOF, Borrower has caused this Mortgage to be duly executed
on the day and year set forth in the acknowledgement attached hereto and to be
effective as of the date first set forth above.
BLUE VALLEY BUILDING CORP.,
a Kansas corporation
ATTEST: [SEAL] By: /s/ Robert D. Regnier
---------------------
Robert D. Regnier, President
By: /s/ Patricia L. Day
Secretary
Acknowledgment
Exhibit A: Legal Description
Exhibit B: Permitted Encumbrances
13
STATE OF MISSOURI )
) ss.
COUNTY OF JACKSON )
NOW, on this 15th day of July, 1994, before me, a Notary Public, appeared
Robert D. Regnier, to me personally known, who being by me duly sworn did say
that he is the President of Blue Valley Building Corp., a Kansas corporation,
and that said instrument was signed in his capacity as President of said
corporation in behalf of said corporation and said Robert D. Regnier
acknowledged said instrument to be the free act and deed of said corporation.
IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed my official
seal in the county and state aforesaid, the day and year lost above written.
/s/ Kathryn R. Mills
Notary Public
[SEAL)
My Commission Expires: KATHRYN L MILLS
Notary Public - Notary Seal
______________________ STATE OF MISSOURI
Clay County
My Commission Expires: May 24, 1997
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EXHIBIT A
Legal Description
Tract B, METCALF AT 119TH STREET DEVELOPMENT, a subdivision in the City of
Overland Park, Johnson County, Kansas; and together with an appurtenant easement
for access as defined by the Declaration of Cross Easement filed January 26,
1989 in Volume 2932 page 171, described as follows: A tract of land lying in the
East 1/2 of the East 1/2 of the Northwest 1/4 of the Northeast 1/4 of Section
19, Township 13 South, Range 25 East, in the City of Overland Park, Johnson
County, Kansas, and also being a part of WINDSOR SQUARE, a subdivision in the
City of Overland Park, Johnson County, Kansas, more particularly described as
follows: Commencing at the Northeast corner of said Northwest 1/4 of the
Northeast 1/4; thence South 00 degrees 06' 10" West along the East line of said
Northwest 1 /4 of the Northeast 1 /4 a distance of 60.00 feet to the Point of
Beginning, said point being the Northeast corner of Lot 1, Block 1, WINDSOR
SQUARE; thence continuing South 00 degrees 06' 10" West along the East line of
said Northwest 1/4 of the Northeast 1/4 a distance of 455.01 feet; thence South
89 degrees 44' 08" West parallel with the North line of said Northwest 1/4 of
the Northeast 1/4 a distance of 32.00 feet; thence North 00 degrees 06' 10" East
parallel with the East line of said Northwest 1/4 of the Northeast 1/4 a
distance of 174.91 feet; thence on a curve to the left having a radius of 15.00
feet (a chord bearing of North 45 degrees 04' 51" West, a length of 21.28 feet)
a distance of 23.66 feet; thence South 89 degrees 44' 08" West parallel with the
North line of said Northwest 1/4 of the Northeast 1/4 a distance of 284.00 feet;
thence North 00 degrees 07' 42" East a distance of 30.00 feet; thence North 89
degrees 44' 08" East parallel with the North line of said Northwest 1/4 of the
Northeast 1/4 a distance of 284.18 feet; thence on a curve to the left having a
radius of 15.00 feet (a chord bearing of North 44 degrees 55' 09" East, a length
of 21.15 feet) a distance of 23.47 feet; thence North 00 degrees 06' 10" East
parallel with the East line of said Northwest 1/4 of the Northeast 1/4 a
distance of 148.35 feet; thence North 02 degrees 16' 17" West a distance of
48.28 feet; thence North 00 degrees 06' 10" East parallel with the East line of
said Northwest 1/4 of the Northeast 1/4 a distance of 11.50 feet; thence on a
curve to the left having a radius of 20.00 feet (a chord bearing of North 18
degrees 17' 11 " West, a length of 12.62 feet) a distance of 12.84 feet; thence
North 89 degrees 44' 08" East parallel with the North line of said Northwest 1/4
of the Northeast 1/4 a distance of 37.98 feet to the point of beginning; and
also together with the appurtenant easement for access defined as the Access
Easement reserved by the document filed August 25, 1992 in Volume 3684 Page 46,
described as follows: All that part of the Northeast 1/4 of the Northeast 1/4 of
Section 19, Township 13, Range 25, in the City of Overland Park, Johnson County,
Kansas, more particularly described as follows: Beginning at the Northwest
corner of the Northeast 1/4 of the Northeast 1/4 of said Section 19; thence
South 01 degrees 57' 41" East along the West line of the Northeast 1/4 of the
Northeast 1/4 of said Section 19, a distance of 310 feet; thence North 88
degrees 02' 19" East, along a line perpendicular to the West line of the
Northeast 1/4 of the Northeast 1/4 of said Section 19, a distance of 35 feet;
thence North 01 degree 57' 41 " West, along a line 35 feet East of and parallel
to the West line of the Northeast 1/4 of the Northeast 1/4 of said Section 19, a
distance of 310.22 feet, to a point on the North line thereof; thence South 87
degrees 40' 39" West, along the North line of the Northeast 1/4 of the Northeast
1/4 of said Section 19, a distance of 35 feet to the point of beginning, all
subject to that part thereof dedicated for street purposes.
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EXHIBIT B
Permitted Encumbrances
1. General and special taxes and assessments for 1994 and subsequent
years, not yet due and payable.
2. Controlled access as defined by document filed in Book of Misc. 169, at
page 193.
3. Right-of-way filed October 24, 1983, in Volume 1928, at page 215.
4. Storm Sewer Easement filed November 29, 1988, in Volume 2903, at page
420.
5. Permanent Storm Water Drainage Easement filed November 30, 1988, in Volume
2904, at page 684.
6. Cross Easement filed October 16, 1989, in Volume 3067, at page 384.
7. Cross Easement and Restrictive Covenant Agreement filed October 16, 1989,
in Volume 3067, at page 392.
8. Easement Agreement filed October 16, 1989, in Volume 3067, at page 397.
9. Easement filed November 20, 1989, in Volume 3085, at page 651.
10. Easement filed December 18, 1989, in Volume 3098, at page 250.
11. Easement filed June 25, 1993, in Volume 3979, at page 817.
12. Sidewalk Easement filed June 29, 1993, in Volume 3982, at page 940.
13. A 35 foot ingress-egress easement and utility easement along the West lot
line and a 30 foot private drive easement affecting the North 15 feet of
Tract B as shown on the recorded plat.
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