EXHIBIT 10.34.1
PREPARED BY AND UPON
RECORDATION RETURN TO:
Messrs. Thacher Proffitt & Wood
Two World Financial Center
New York, New York 10281
Attention: David S. Hall, Esq.
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and
, as trustor
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to
, as trustee
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for the benefit of
JPMORGAN CHASE BANK, as beneficiary
(Lender)
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DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FIXTURE FILING
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Dated: As of , 2004
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Location:
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County:
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File No.:
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Title No.:
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THIS DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT
AND FIXTURE FILING (this "Security Instrument") is made as of the ___ day of
______ 2004 by _____________________, a Delaware _______________, having an
address at c/o FelCor Lodging Trust Incorporated, 545 East John Carpenter
Freeway, Suite 1300, Irving, Texas 75062, as trustor ("Owner") and
____________________, a Delaware ____________________, having an address at c/o
FelCor Lodging Trust Incorporated, 545 East John Carpenter Freeway, Suite 1300,
Irving, Texas 75062, as trustor ("Operating Lessee") (Owner and Operating Lessee
being hereinafter collectively referred to as "Trustor") to
____________________, a_______________, having its principal place of business
at ________________________________, as trustee ("Trustee") for the benefit of
JPMORGAN CHASE BANK, a New York banking corporation, having its principal place
of business at 270 Park Avenue, New York, New York 10017, as beneficiary
("Lender").
RECITALS:
Owner is the fee owner of the Land (hereinafter defined).
Operating Lessee is the owner of the leasehold estate in said real
property pursuant to the Operating Lease (as defined in the Loan Agreement
(hereinafter defined).
This Security Instrument is given to secure a loan (the "Loan") in the
principal sum of _________________DOLLARS ($___________) made pursuant to that
certain Loan Agreement, dated as of the date hereof, between Owner and Lender
(as the same may be amended, restated, replaced, supplemented or otherwise
modified from time to time, the "Loan Agreement") and evidenced by the Note (as
defined in the Loan Agreement).
Trustor desires to secure the payment of the Debt (as defined in the
Loan Agreement) and the performance of all of Trustor's obligations under the
Note, the Loan Agreement and the other Loan Documents (as herein defined).
This Security Instrument is given pursuant to the Loan Agreement, and
payment, fulfillment, and performance by Trustor of its obligations thereunder
and under the other Loan Documents are secured hereby, and each and every term
and provision of the Loan Agreement, the Note, and that certain Assignment of
Leases and Rents dated the date hereof made by Trustor in favor of Lender
delivered in connection with this Security Instrument (as the same may be
amended, restated, replaced, supplemented or otherwise modified from time to
time, the "Assignment of Leases"), including the rights, remedies, obligations,
covenants, conditions, agreements, indemnities, representations and warranties
of the parties therein, are hereby incorporated by reference herein as though
set forth in full and shall be considered a part of this Security Instrument
(the Loan Agreement, the Note, this Security Instrument, the Assignment of
Leases and all other documents evidencing or securing the Debt (including all
additional mortgages, deeds to secure debt and assignments of leases and rents)
or executed or delivered in connection therewith, are hereinafter referred to
collectively as the "Loan Documents"). All capitalized terms not otherwise
defined herein shall have the meaning ascribed to them in the Loan Agreement.
ARTICLE 1 - GRANTS OF SECURITY
SECTION 1.1 PROPERTY MORTGAGED. Trustor does hereby irrevocably
mortgage, grant, bargain, sell, pledge, assign, warrant, transfer and convey to
and grant a security interest to Trustee, its successors and assigns, for the
benefit of Lender and its successors and assigns in, and grant a security
interest to Lender and Trustee, and their respective successors and assigns in,
the following property, rights, interests and estates now owned, or hereafter
acquired by Trustor (collectively, the "Property"):
(a) Land. The real property described in Exhibit A attached hereto and
made a part hereof (the "Land");
(b) Operating Lease. The Operating Lease and the leasehold estate
created thereby, including all assignments, modifications, extensions and
renewals of the Operating Lease and all credits, deposits, options, privileges
and rights of Operating Lessee as tenant under the Operating Lease, including,
but not limited to, rights of first refusal, if any, and the right, if any, to
renew or extend the Operating Lease for a succeeding term or terms, and also
including all the right, title, claim or demand whatsoever of Operating Lessee
either in law or in equity, in possession or expectancy, of, in and to the
right, as tenant under the Operating Lease, to elect under Section 365(h)(l) of
the Bankruptcy Code, Title 11 U.S.C.A. Section 101 et seq. (the "Bankruptcy
Code") to terminate or treat the Operating Lease as terminated in the event (i)
of the bankruptcy, reorganization or insolvency of the lessor thereunder, and
(ii) the rejection of the Operating Lease by the lessor thereunder, as debtor in
possession, or by a trustee for the lessor thereunder, pursuant to Section 365
of the Bankruptcy Code;
(c) Additional Land. All additional lands, estates and development
rights hereafter acquired by Trustor for use in connection with the Land and the
development of the Land and all additional lands and estates therein which may,
from time to time, by supplemental mortgage or otherwise be expressly made
subject to the lien of this Security Instrument;
(d) Improvements. The buildings, structures, fixtures, additions,
enlargements, extensions, modifications, repairs, replacements and improvements
now or hereafter erected or located on the Land (the "Improvements");
(e) Easements. All easements, rights-of-way or use, rights, strips and
gores of land, streets, ways, alleys, passages, sewer rights, water, water
courses, water rights and powers, air rights and development rights, and all
estates, rights, titles, interests, privileges, liberties, servitudes,
tenements, hereditaments and appurtenances of any nature whatsoever, in any way
now or hereafter belonging, relating or pertaining to the Land and the
Improvements, including, but not limited to, those arising under and by virtue
of the Operating Lease, and the reversion and reversions, remainder and
remainders, and all land lying in the bed of any street, road or avenue, opened
or proposed, in front of or adjoining the Land, to the center line thereof and
all the estates, rights, titles, interests, dower and rights of dower, curtesy
and rights of curtesy, property, possession, claim and demand whatsoever, both
at law and in equity, of Trustor of, in and to the Land and the Improvements,
including, but not limited to, those arising under and by virtue of the
Operating Lease, and every part and parcel thereof, with the appurtenances
thereto;
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(f) Fixtures and Personal Property. All machinery, equipment, fixtures
(including, but not limited to, all heating, air conditioning, plumbing,
lighting, communications and elevator fixtures, inventory and goods), inventory
and articles of personal property and accessions thereof and renewals,
replacements thereof and substitutions therefor (including, but not limited to,
beds, bureaus, chiffonniers, chests, chairs, desks, lamps, mirrors, bookcases,
tables, rugs, carpeting, drapes, draperies, curtains, shades, venetian blinds,
screens, paintings, hangings, pictures, divans, couches, luggage carts, luggage
racks, stools, sofas, chinaware, linens, pillows, blankets, glassware,
silverware, foodcarts, cookware, dry cleaning facilities, dining room wagons,
keys or other entry systems, bars, bar fixtures, liquor and other drink
dispensers, icemakers, radios, television sets, intercom and paging equipment,
electric and electronic equipment, dictating equipment, private telephone
systems, medical equipment, potted plants, heating, lighting and plumbing
fixtures, fire prevention and extinguishing apparatus, cooling and
air-conditioning systems, elevators, escalators, fittings, plants, apparatus,
stoves, ranges, refrigerators, laundry machines, tools, machinery, engines,
dynamos, motors, boilers, incinerators, switchboards, conduits, compressors,
vacuum cleaning systems, floor cleaning, waxing and polishing equipment, call
systems, brackets, electrical signs, bulbs, bells, ash and fuel, conveyors,
cabinets, lockers, shelving, spotlighting equipment, dishwashers, garbage
disposals, washers and dryers), other customary hotel equipment and other
tangible property of every kind and nature whatsoever owned by Trustor, or in
which Trustor has or shall have an interest, now or hereafter located upon the
Land and the Improvements, or appurtenant thereto, and usable in connection with
the present or future operation and occupancy of the Land and the Improvements
and all building equipment, materials and supplies of any nature whatsoever
owned by Trustor, or in which Trustor has or shall have an interest, now or
hereafter located upon the Land and the Improvements, or appurtenant thereto, or
usable in connection with the present or future operation and occupancy of the
Land and the Improvements (collectively, the "Personal Property"), and the
right, title and interest of Trustor in and to any of the Personal Property
which may be subject to any security interests, as defined in the Uniform
Commercial Code, as adopted and enacted by the State or States where any of the
Property is located (the "Uniform Commercial Code"), superior in lien to the
lien of this Security Instrument and all proceeds and products of the above;
(g) Leases and Rents. All leases, subleases , rental agreements,
registration cards and agreements, if any, and other agreements , whether or not
in writing, affecting the use, enjoyment or occupancy of the Land and/or the
Improvements heretofore or hereafter entered into and all extensions, amendments
and modifications thereto, whether before or after the filing by or against
Trustor of any petition for relief under the Bankruptcy Code (the "Leases") and
all right, title and interest of Trustor, its successors and assigns therein and
thereunder, including, without limitation, any guaranties of the lessees'
obligations thereunder, cash or securities deposited thereunder to secure the
performance by the lessees of their obligations thereunder and all rents,
additional rents, revenues, issues, registration fees, if any, and profits
(including all oil and gas or other mineral royalties and bonuses) from the
Land, the Improvements, all income, rents, room rates, issues, profits,
revenues, deposits, accounts and other benefits from the operation of the hotel
on the Land and/or the Improvements, including, without limitation, all revenues
and credit card receipts collected from guest rooms, restaurants, bars,
mini-bars, meeting rooms, banquet rooms and recreational facilities and
otherwise, all receivables, customer obligations, installment payment
obligations and other obligations now existing or hereafter arising or created
out of sale, lease, sublease, license, concession or other grant of the right of
the possession, use or occupancy
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of all or any portion of the Land and/or Improvements, or personalty located
thereon, or rendering of services by Trustor or any operator or manager of the
hotel or the commercial space located in the Improvements or acquired from
others including, without limitation, from the rental of any office space,
retail space, commercial space, guest room or other space, halls, stores or
offices, including any deposits securing reservations of such space, exhibit or
sales space of every kind, license, lease, sublease and concession fees and
rentals, health club membership fees, food and beverage wholesale and retail
sales, service charges, vending machine sales and proceeds, if any, from
business interruption or other loss of income insurance relating to the use,
enjoyment or occupancy of the Land and/or the Improvements whether paid or
accruing before or after the filing by or against Trustor of any petition for
relief under the Bankruptcy Code (the "Rents") and all proceeds from the sale or
other disposition of the Leases and the right to receive and apply the Rents to
the payment of the Debt;
(h) Condemnation Awards. All awards or payments, including interest
thereon, which may heretofore and hereafter be made with respect to the
Property, whether from the exercise of the right of eminent domain (including
but not limited to any transfer made in lieu of or in anticipation of the
exercise of the right), or for a change of grade, or for any other injury to or
decrease in the value of the Property;
(i) Insurance Proceeds. All proceeds of and any unearned premiums on
any insurance policies covering the Property, including, without limitation, the
right to receive and apply the proceeds of any insurance, judgments, or
settlements made in lieu thereof, for damage to the Property;
(j) Tax Certiorari. All refunds, rebates or credits in connection with
a reduction in real estate taxes and assessments charged against the Property as
a result of tax certiorari or any applications or proceedings for reduction;
(k) Conversion. All proceeds of the conversion, voluntary or
involuntary, of any of the foregoing including, without limitation, proceeds of
insurance and condemnation awards, into cash or liquidation claims;
(l) Rights. The right, in the name and on behalf of Trustor, to appear
in and defend any action or proceeding brought with respect to the Property and
to commence any action or proceeding to protect the interest of Lender in the
Property;
(m) Agreements. All agreements, contracts, certificates, instruments,
franchises, permits, licenses, plans, specifications and other documents, now or
hereafter entered into, and all rights therein and thereto, respecting or
pertaining to the use, occupation, construction, management or operation of the
Land and any part thereof and any Improvements or respecting any business or
activity conducted on the Land and any part thereof and all right, title and
interest of Trustor therein and thereunder, including, without limitation, the
right, upon the happening of any default hereunder, to receive and collect any
sums payable to Trustor thereunder;
(n) Intangibles. All trade names, trademarks, servicemarks, logos,
copyrights, goodwill, books and records, tenant or guest lists, advertising
materials, telephone exchange
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numbers identified in such materials and all other general intangibles relating
to or used in connection with the operation of the Property;
(o) Accounts. All Accounts, Account Collateral, reserves, escrows and
deposit accounts maintained by Trustor with respect to the Property including,
without limitation, the Lockbox Account and the Property Accounts, and all
complete securities, investments, property and financial assets held therein
from time to time and all proceeds, products, distributions or dividends or
substitutions thereon and thereof;
(p) Causes of Action. All causes of action and claims (including,
without limitation, all causes of action or claims arising in tort, by contract,
by fraud or by concealment of material fact) against any Person for damages or
injury to the Property or in connection with any transactions financed in whole
or in part by the proceeds of the Loan ("Cause of Action");
(q) Accounts Receivables. All right, title and interest of Trustor
arising from the operation of the Land and the Improvements in and to all
payments for goods or property sold or leased or for services rendered, whether
or not yet earned by performance, and not evidenced by an instrument or chattel
paper, (hereinafter referred to as "Accounts Receivable") including, without
limiting the generality of the foregoing, (i) all accounts, contract rights,
book debts, and notes arising from the operation of a hotel on the Land and the
Improvements or arising from the sale, lease or exchange of goods or other
property and/or the performance of services, (ii) Trustor's rights to payment
from any consumer credit/charge card organization or entities which sponsor and
administer such cards as the American Express Card, the Visa Card and the
Mastercard, (iii) Trustor's rights in, to and under all purchase orders for
goods, services or other property, (iv) Trustor's rights to any goods, services
or other property represented by any of the foregoing, (v) monies due to or to
become due to Trustor under all contracts for the sale, lease or exchange of
goods or other property and/or the performance of services including the right
to payment of any interest or finance charges in respect thereto (whether or not
yet earned by performance on the part of Trustor) and (vi) all collateral
security and guaranties of any kind given by any person or entity with respect
to any of the foregoing. Accounts Receivable shall include those now existing or
hereafter created, substitutions therefor, proceeds (whether cash or non-cash,
movable or immovable, tangible or intangible) received upon the sale, exchange,
transfer, collection or other disposition or substitution thereof and any and
all of the foregoing and proceeds therefrom;
(r) Security Interests. All right, title and interest of lessor under
the Operating Lease as secured party in the personal property and collateral
pursuant to the security interest granted by Operating Lessee to the lessor
thereunder in the Operating Lease (the "Operating Lease Security Agreement");
and
(s) Other Rights. Any and all other rights of Trustor in and to the
items set forth in Subsections (a) through (r) above.
SECTION 1.2 ASSIGNMENT OF LEASES AND RENTS. Trustor hereby absolutely
and unconditionally assigns to Lender Trustor's right, title and interest in and
to all current and future Leases and Rents and the Operating Lease Security
Agreement; it being intended by Trustor that this assignment constitutes a
present, absolute assignment and not an assignment for additional
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security only. Nevertheless, subject to the terms of this Section 1.2, Section
9.1(h) and the Loan Agreement, Lender grants to Trustor a revocable license to
collect and receive the Rents. Trustor shall hold the Rents, or a portion
thereof sufficient to discharge all current sums due on the Debt, for use in the
payment of such sums.
SECTION 1.3 SECURITY AGREEMENT. This Security Instrument is both a real
property mortgage and a "security agreement" within the meaning of the Uniform
Commercial Code. The Property includes both real and personal property and all
other rights and interests, whether tangible or intangible in nature, of Trustor
in the Property. By executing and delivering this Security Instrument, Trustor
hereby grants to Lender and Trustee, as security for the Obligations, (as herein
defined) a security interest in the Personal Property, the Accounts, and the
Account Collateral to the full extent that the Personal Property, the Accounts
and the Account Collateral may be subject to the Uniform Commercial Code and in
the Operating Lease Security Agreement.
SECTION 1.4 PLEDGE OF MONIES HELD. Trustor hereby pledges to Lender any
and all monies now or hereafter held by Lender, including, without limitation,
any sums deposited in the Reserve Funds, the Accounts, Net Proceeds and Awards,
as additional security for the Obligations until expended or applied as provided
in the Loan Agreement or this Security Instrument.
CONDITIONS TO GRANT
TO HAVE AND TO HOLD the above granted and described Property unto and
to the use and benefit of Lender and Trustee, and for their respective
successors and assigns, forever;
IN TRUST, WITH POWER OF SALE, to secure payment to Lender of the Debt
at the time and in the manner provided for its payment in the Note, the Loan
Agreement, and in this Security Instrument;
PROVIDED, HOWEVER, these presents are upon the express condition that,
if Trustor shall well and truly pay to Lender the Debt at the time and in the
manner provided in the Note and this Security Instrument, shall well and truly
perform the Other Obligations (as herein defined) as set forth in this Security
Instrument and shall well and truly abide by and comply with each and every
covenant and condition set forth herein, in the Note and in the Loan Agreement,
these presents and the estate hereby granted shall cease, terminate and be void.
ARTICLE 2 - DEBT AND OBLIGATIONS SECURED
SECTION 2.1 DEBT. This Security Instrument and the grants, assignments
and transfers made in Article 1 are given for the purpose of securing the Debt,
including without limitation,
(a) the payment of the indebtedness evidenced by the Note in lawful
money of the United States of America;
(b) the payment of interest, default interest, late charges and other
sums, as provided in the Note, the Loan Agreement, this Security Instrument or
the other Loan Documents;
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(c) the payment of the Yield Maintenance Premium, if any;
(d) the payment of all other moneys agreed or provided to be paid by
Trustor in the Note, the Loan Agreement, this Security Instrument or the other
Loan Documents;
(e) the payment of all sums advanced pursuant to the Loan Agreement or
this Security Instrument to protect and preserve the Property and the lien and
the security interest created hereby; and
(f) the payment of all sums advanced and costs and expenses incurred by
Lender in connection with the Debt or any part thereof, any modification,
amendment, renewal, extension, or change of or substitution for the Debt or any
part thereof, or the acquisition or perfection of the security therefor, whether
made or incurred at the request of Trustor or Lender.
SECTION 2.2 OTHER OBLIGATIONS. This Security Instrument and the grants,
assignments and transfers made in Article 1 are also given for the purpose of
securing the following (the "Other Obligations"):
(a) the performance of all other obligations of Trustor contained
herein;
(b) the performance of each obligation of Trustor contained in any
other agreement given by Trustor to Lender which is for the purpose of further
securing the obligations secured hereby, and any renewals, extensions,
substitutions, replacements, amendments, modifications and changes thereto; and
(c) the performance of each obligation of Trustor contained in any
renewal, extension, amendment, modification, consolidation, change of, or
substitution or replacement for, all or any part of the Note, the Loan
Agreement, this Security Instrument or the other Loan Documents.
SECTION 2.3 DEBT AND OTHER OBLIGATIONS. Trustor's obligations for the
payment of the Debt and the performance of the Other Obligations shall be
referred to collectively below as the "Obligations."
ARTICLE 3 - MORTGAGOR COVENANTS
Trustor covenants and agrees that:
SECTION 3.1 PAYMENT OF DEBT. Trustor will pay the Debt at the time and
in the manner provided in the Note, the Loan Agreement and in this Security
Instrument.
SECTION 3.2 INCORPORATION BY REFERENCE. All the covenants, conditions
and agreements contained in the Loan Agreement, the Note and all and any of the
other Loan Documents, are hereby made a part of this Security Instrument to the
same extent and with the same force as if fully set forth herein.
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SECTION 3.3 INSURANCE. Trustor shall obtain and maintain, or cause to
be maintained, insurance in full force and effect at all times with respect to
Trustor and the Property as required pursuant to the Loan Agreement.
SECTION 3.4 PAYMENT OF TAXES, ETC. Trustor shall promptly pay all Taxes
and Other Charges in accordance with the terms of the Loan Agreement.
SECTION 3.5 MAINTENANCE AND USE OF PROPERTY. Trustor shall cause the
Property to be maintained in a good and safe condition and repair in accordance
with the terms of the Loan Agreement. Subject to the terms of the Loan
Agreement, the Improvements and the Personal Property shall not be removed,
demolished or materially altered or expanded (except for normal replacement of
the Personal Property) without the consent of Lender. Subject to the terms of
the Loan Agreement, Trustor shall promptly repair, replace or rebuild any part
of the Property which may be destroyed by any Casualty, or become damaged, worn
or dilapidated or which may be affected by any Condemnation and shall complete
and pay for any structure at any time in the process of construction or repair
on the Land. Subject to the terms of the Loan Agreement, Trustor shall not
initiate, join in, acquiesce in, or consent to any change in any private
restrictive covenant, zoning law or other public or private restriction,
limiting or defining the uses which may be made of the Property or any part
thereof. If under applicable zoning provisions the use of all or any portion of
the Property is or shall become a nonconforming use, Trustor will not cause or
permit the nonconforming use to be discontinued or the nonconforming Improvement
to be abandoned without the express written consent of Lender.
SECTION 3.6 WASTE. Trustor shall not commit or suffer any waste of the
Property or make any change in the use of the Property which will in any way
materially increase the risk of fire or other hazard arising out of the
operation of the Property, or take any action that might invalidate or give
cause for cancellation of any Policy, or do or permit to be done thereon
anything that may in any way impair the value of the Property or the security of
this Security Instrument. Trustor will not, without the prior written consent of
Lender, permit any drilling or exploration for or extraction, removal, or
production of any minerals from the surface or the subsurface of the Land,
regardless of the depth thereof or the method of mining or extraction thereof.
SECTION 3.7 PAYMENT FOR LABOR AND MATERIALS. Except as may be permitted
under the Loan Agreement, Trustor will promptly pay when due all bills and costs
for labor, materials, and specifically fabricated materials incurred in
connection with the Property and never permit to exist in respect of the
Property or any part thereof any lien or security interest, even though inferior
to the liens and the security interests hereof, and in any event never permit to
be created or exist in respect of the Property or any part thereof any other or
additional lien or security interest other than the liens or security interests
hereof, except for the Permitted Encumbrances.
SECTION 3.8 PERFORMANCE OF OTHER AGREEMENTS. Trustor shall observe and
perform each and every term to be observed or performed by Trustor pursuant to
the terms of the Loan Agreement, any other Loan Documents and any agreement or
recorded instrument affecting or pertaining to the Property, including but not
limited to the Operating Lease and any
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franchise agreements, or given by Trustor to Lender for the purpose of further
securing the Obligations and any amendments, modifications or changes thereto.
SECTION 3.9 CHANGE OF NAME, IDENTITY OR STRUCTURE. Except as may be
permitted under the Loan Agreement, Trustor will not change Trustor's name,
identity (including its trade name or names) or corporate, partnership or other
structure without first obtaining the prior written consent of Lender. Trustor
hereby authorizes Lender, prior to or contemporaneously with the effective date
of any such change, to file any financing statement or financing statement
change required by Lender to establish or maintain the validity, perfection and
priority of the security interest granted herein. At the request of Lender,
Trustor shall execute a certificate in form satisfactory to Lender listing the
trade names under which Trustor intends to operate the Property, and
representing and warranting that Trustor does business under no other trade name
with respect to the Property.
SECTION 3.10 PROPERTY USE. The Property shall be used only for a hotel
and any ancillary uses relating thereto, and for no other uses without the prior
written consent of Lender, which consent may be withheld in Lender's sole and
absolute discretion.
ARTICLE 4 - REPRESENTATIONS AND WARRANTIES
Trustor represents and warrants to Lender that:
SECTION 4.1 WARRANTY OF TITLE. Trustor has good title to the Property and has
the right to mortgage, grant, bargain, sell, pledge, assign, warrant, transfer
and convey the same. Owner possesses an unencumbered fee simple absolute estate
and Operating Lessee possesses an unencumbered leasehold estate (created by and
pursuant to the terms of the Operating Lease) in the Land and the Improvements.
Trustor owns the Property free and clear of all liens, encumbrances and charges
whatsoever except for the Permitted Encumbrances. The Permitted Encumbrances do
not and will not materially adversely affect or interfere with the value, or
materially adversely affect or interfere with the current use or operation, of
the Property, or the security intended to be provided by this Security
Instrument or the ability of Trustor to repay the Note or any other amount owing
under the Note, this Security Instrument, the Loan Agreement, or the other Loan
Documents or to perform its obligations thereunder in accordance with the terms
of the Loan Agreement, the Note, this Security Instrument or the other Loan
Documents. This Security Instrument, when properly recorded in the appropriate
records, together with the Assignment of Leases and any Uniform Commercial Code
financing statements required to be filed in connection therewith, will create
(i) a valid, perfected first priority lien on the Property, subject only to
Permitted Encumbrances and (ii) perfected security interests in and to, and
perfected collateral assignments of, all personalty (including the Leases), all
in accordance with the terms thereof, subject only to Permitted Encumbrances.
The Assignment of Leases, when properly recorded in the appropriate records,
creates a valid first priority assignment of, or a valid first priority security
interest in, certain rights under the related Leases, subject only to a license
granted to Trustor to exercise certain rights and to perform certain obligations
of the lessor under such Leases, including the right to operate the Property. No
Person other than Trustor owns any interest in any payments due under such
Leases that is superior to or of equal priority with the Lender's interest
therein. Trustor shall forever warrant, defend and preserve the title and the
validity and priority of the lien of this Security Instrument and shall forever
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warrant and defend the same to Lender and/or Trustee against the claims of all
persons whomsoever.
ARTICLE 5 - OBLIGATIONS AND RELIANCES
SECTION 5.1 RELATIONSHIP OF TRUSTOR AND LENDER. The relationship
between Trustor and Lender is solely that of debtor and creditor, and Lender has
no fiduciary or other special relationship with Trustor, and no term or
condition of any of the Loan Agreement, the Note, this Security Instrument and
the other Loan Documents shall be construed so as to deem the relationship
between Trustor and Lender to be other than that of debtor and creditor.
SECTION 5.2 NO RELIANCE ON LENDER. The members, general partners,
principals and (if Trustor is a trust) beneficial owners of Trustor are
experienced in the ownership and operation of properties similar to the
Property, and Trustor and Lender are relying solely upon such expertise and
business plan in connection with the ownership and operation of the Property.
Trustor is not relying on Lender's expertise, business acumen or advice in
connection with the Property.
SECTION 5.3 NO LENDER OBLIGATIONS. (a) Notwithstanding the provisions
of Section 1.1(g), (m) and (n) or Section 1.2, Lender is not undertaking the
performance of (i) any obligations under the Leases; or (ii) any obligations
with respect to such agreements, contracts, certificates, instruments,
franchises, permits, trademarks, licenses and other documents.
(a) By accepting or approving anything required to be observed,
performed or fulfilled or to be given to Lender pursuant to this Security
Instrument, the Loan Agreement, the Note or the other Loan Documents, including
without limitation, any officer's certificate, balance sheet, statement of
profit and loss or other financial statement, survey, appraisal, or insurance
policy, Lender shall not be deemed to have warranted, consented to, or affirmed
the sufficiency, the legality or effectiveness of same, and such acceptance or
approval thereof shall not constitute any warranty or affirmation with respect
thereto by Lender.
SECTION 5.4 RELIANCE. Trustor recognizes and acknowledges that in
accepting the Note, the Loan Agreement, this Security Instrument and the other
Loan Documents, (i) Lender is expressly and primarily relying on the truth and
accuracy of the warranties and representations set forth in Article 4 of the
Loan Agreement and Articles 3 and 4 hereof without any obligation to investigate
the Property and notwithstanding any investigation of the Property by Lender;
(ii) that such reliance existed on the part of Lender prior to the date hereof;
(iii) that the warranties and representations are a material inducement to
Lender in accepting the Note, the Loan Agreement, this Security Instrument and
the other Loan Documents; and that Lender would not be willing to make the Loan
and accept this Security Instrument in the absence of the warranties and
representations as set forth in Article 4 of the Loan Agreement and Articles 3
and 4 hereof.
ARTICLE 6 - FURTHER ASSURANCES
SECTION 6.1 RECORDING OF SECURITY INSTRUMENT, ETC. Trustor forthwith upon the
execution and delivery of this Security Instrument and thereafter, from time to
time, will cause this Security Instrument and any of the other Loan Documents
creating a lien or security interest or evidencing the lien hereof upon the
Property and each instrument of further assurance to be
10
filed, registered or recorded in such manner and in such places as may be
required by any present or future law in order to publish notice of and fully to
protect and perfect the lien or security interest hereof upon, and the interest
of Lender in, the Property. Trustor will pay all taxes, filing, registration or
recording fees, and all expenses incident to the preparation, execution,
acknowledgment and/or recording of the Note, the Loan Agreement, this Security
Instrument, the other Loan Documents, and any instrument of further assurance,
and any modification or amendment of the foregoing documents, and all federal,
state, county and municipal taxes, duties, imposts, assessments and charges
arising out of or in connection with the execution and delivery of this Security
Instrument, the other Loan Documents, or any instrument of further assurance,
and any modification or amendment of the foregoing documents, except where
prohibited by law so to do.
SECTION 6.2 FURTHER ACTS, ETC. Trustor will, at the cost of Trustor,
and without expense to Lender, do, execute, acknowledge and deliver all and
every such further acts, deeds, conveyances, deeds of trust, mortgages,
assignments, notices of assignments, transfers and assurances as Lender shall,
from time to time, reasonably require, for the better assuring, conveying,
assigning, transferring, and confirming unto Lender and Trustee the Property and
rights hereby deeded, mortgaged, granted, bargained, sold, conveyed, confirmed,
pledged, assigned, warranted and transferred or intended now or hereafter so to
be, or which Trustor may be or may hereafter become bound to convey or assign to
Lender, or for carrying out the intention or facilitating the performance of the
terms of this Security Instrument or for filing, registering or recording this
Security Instrument, or for complying with all Legal Requirements. Trustor, on
demand, will execute and deliver and hereby authorizes Lender, following ten
(10) days' notice to Trustor, to execute in the name of Trustor or without the
signature of Trustor to the extent Lender may lawfully do so, one or more
financing statements, chattel mortgages or other comparable security
instruments, to evidence more effectively the security interest of Lender in the
Property or any Collateral. Trustor grants to Lender an irrevocable power of
attorney coupled with an interest for the purpose of exercising and perfecting
any and all rights and remedies available to Lender at law and in equity,
including without limitation such rights and remedies available to Lender
pursuant to this Section 6.2.
SECTION 6.3 CHANGES IN TAX, DEBT CREDIT AND DOCUMENTARY STAMP LAWS.
(a) If any law is enacted or adopted or amended after the date of this
Security Instrument which deducts the Debt from the value of the Property for
the purpose of taxation or which imposes a tax, either directly or indirectly,
on the Debt or Lender's interest in the Property, Trustor will pay the tax, with
interest and penalties thereon, if any. If Lender is advised by counsel chosen
by it that the payment of tax by Trustor would be unlawful or taxable to Lender
or unenforceable or provide the basis for a defense of usury, then Lender shall
have the option, exercisable by written notice of not less than ninety (90) days
to declare the Debt immediately due and payable.
(b) Trustor will not claim or demand or be entitled to any credit or
credits on account of the Debt for any part of the Taxes or Other Charges
assessed against the Property, or any part thereof, and no deduction shall
otherwise be made or claimed from the assessed value of the Property, or any
part thereof, for real estate tax purposes by reason of this Security Instrument
or the Debt. If such claim, credit or deduction shall be required by law, Lender
shall have the
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option, exercisable by written notice of not less than ninety (90) days, to
declare the Debt immediately due and payable.
(c) If at any time the United States of America, any State thereof or
any subdivision of any such State shall require revenue or other stamps to be
affixed to the Note, the Loan Agreement, this Security Instrument, or any of the
other Loan Documents or impose any other tax or charge on the same, Trustor will
pay for the same, with interest and penalties thereon, if any.
SECTION 6.4 REPLACEMENT DOCUMENTS. Upon receipt of an affidavit of an
officer of Lender as to the loss, theft, destruction or mutilation of the Note
or any other Loan Document which is not of public record, and, in the case of
any such mutilation, upon surrender and cancellation of such Note or other Loan
Documents, Trustor will issue, in lieu thereof, a replacement Note or other Loan
Documents, dated the date of such lost, stolen, destroyed or mutilated Note or
other Loan Documents in the same principal amount thereof and containing
substantially identical terms.
SECTION 6.5 PERFORMANCE AT TRUSTOR'S EXPENSE. Trustor acknowledges and
confirms that Lender shall impose certain administrative processing and/or
commitment fees in connection with (a) the extension, renewal, modification,
amendment and termination of the Loan, (b) the release or substitution of
collateral therefor, (c) obtaining certain consents, waivers and approvals with
respect to the Property, or (d) the review of any Lease or proposed Lease or the
preparation or review of any subordination, non-disturbance agreement (the
occurrence of any of the above shall be called an "Event"). Trustor further
acknowledges and confirms that it shall be responsible for the payment of all
costs of reappraisal of the Property or any part thereof, whether required by
law, regulation, Lender or any governmental or quasi-governmental authority.
Trustor hereby acknowledges and agrees to pay, immediately, with or without
demand, all such fees (as the same may be increased or decreased from time to
time), and any additional fees of a similar type or nature which may be imposed
by Lender from time to time, upon the occurrence of any Event. Wherever it is
provided for herein that Trustor pay any costs and expenses, such costs and
expenses shall include, but not be limited to, all legal fees and disbursements
of Lender (excluding legal fees for in-house staff), whether with respect to
retained firms or otherwise.
SECTION 6.6 LEGAL FEES FOR ENFORCEMENT. (a) Trustor shall pay all
reasonable legal fees incurred by Lender in connection with the preparation of
the Loan Agreement, the Note, this Security Instrument and the other Loan
Documents and (b) Trustor shall pay to Lender on demand any and all expenses,
including legal expenses and attorneys' fees, incurred or paid by Lender in
protecting its interest in the Property or in collecting any amount payable
hereunder or in enforcing its rights hereunder with respect to the Property
(including commencing any foreclosure action), whether or not any legal
proceeding is commenced hereunder or thereunder, together with interest thereon
at the Default Rate from the date paid or incurred by Lender until such expenses
are paid by Trustor.
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ARTICLE 7 - DUE ON SALE/ENCUMBRANCE
SECTION 7.1 LENDER RELIANCE. Trustor acknowledges that Lender has
examined and relied on the experience of Trustor and its partners, members,
principals and (if Trustor is a trust) beneficial owners in owning and operating
properties such as the Property in agreeing to make the Loan, and will continue
to rely on Trustor's ownership of the Property as a means of maintaining the
value of the Property as security for repayment of the Debt and the performance
of the Other Obligations. Trustor acknowledges that Lender has a valid interest
in maintaining the value of the Property so as to ensure that, should Trustor
default in the repayment of the Debt or the performance of the Other
Obligations, Lender can recover the Debt by a sale of the Property.
SECTION 7.2 NO SALE/ENCUMBRANCE. Neither Trustor nor any Restricted
Party shall Transfer the Property or any part thereof or any interest therein or
permit or suffer the Property or any part thereof or any interest therein to be
Transferred other than as expressly permitted pursuant to the terms of the Loan
Agreement.
ARTICLE 8 - PREPAYMENT
SECTION 8.1 PREPAYMENT. The Debt may not be prepaid in whole or in part
except in accordance with the express terms and conditions of the Loan
Agreement.
ARTICLE 9 - RIGHTS AND REMEDIES
SECTION 9.1 REMEDIES. Upon the occurrence of any Event of Default (as
defined in the Loan Agreement), Trustor agrees that Lender may, or acting
through Trustee may, take such action, without notice or demand, as it deems
advisable to protect and enforce its rights against Trustor and in and to the
Property, including, but not limited to, the following actions, each of which
may be pursued concurrently or otherwise, at such time and in such order as
Lender may determine, in its sole discretion, without impairing or otherwise
affecting the other rights and remedies of Lender or Trustee:
(a) declare the entire unpaid Debt to be immediately due and payable;
(b) institute proceedings, judicial or otherwise, for the complete
foreclosure of this Security Instrument under any applicable provision of law in
which case the Property or any interest therein may be sold for cash or upon
credit in one or more parcels or in several interests or portions and in any
order or manner;
(c) with or without entry, to the extent permitted and pursuant to the
procedures provided by Applicable Law, institute proceedings for the partial
foreclosure of this Security Instrument for the portion of the Debt then due and
payable, subject to the continuing lien and security interest of this Security
Instrument for the balance of the Debt not then due, unimpaired and without loss
of priority;
(d) sell for cash or upon credit the Property or any part thereof and
all estate, claim, demand, right, title and interest of Trustor therein and
rights of redemption thereof, pursuant to
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power of sale or otherwise, at one or more sales, in one or more parcels, at
such time and place, upon such terms and after such notice thereof as may be
required or permitted by law;
(e) institute an action, suit or proceeding in equity for the specific
performance of any covenant, condition or agreement contained herein, in the
Note, the Loan Agreement, or in the other Loan Documents;
(f) recover judgment on the Note either before, during or after any
proceedings for the enforcement of this Security Instrument or the other Loan
Documents;
(g) apply for the appointment of a receiver, trustee, liquidator or
conservator of the Property, without notice and without regard for the adequacy
of the security for the Debt and without regard for the solvency of Trustor, any
Guarantor or of any person, firm or other entity liable for the payment of the
Debt;
(h) subject to any Applicable Law, the license granted to Trustor under
Section 1.2 hereof shall automatically be revoked and Lender may enter into or
upon the Property, either personally or by its agents, nominees or attorneys and
dispossess Trustor and its agents and servants therefrom, without liability for
trespass, damages or otherwise and exclude Trustor and its agents or servants
wholly therefrom, and take possession of all books, records and accounts
relating thereto and Trustor agrees to surrender possession of the Property and
of such books, records and accounts to Lender upon demand, and thereupon Lender
may (i) use, operate, manage, control, insure, maintain, repair, restore and
otherwise deal with all and every part of the Property and conduct business
thereon; (ii) complete any construction on the Property in such manner and form
as Lender deems advisable; (iii) make alterations, additions, renewals,
replacements and improvements to or on the Property; (iv) exercise all rights
and powers of Trustor with respect to the Property, whether in the name of
Trustor or otherwise, including, without limitation, the right to make, cancel,
enforce or modify Leases, obtain and evict tenants, and demand, sue for, collect
and receive all Rents of the Property and every part thereof; (v) require
Trustor to pay monthly in advance to Lender, or any receiver appointed to
collect the Rents, the fair and reasonable rental value for the use and
occupation of such part of the Property as may be occupied by Trustor; (vi)
require Trustor to vacate and surrender possession of the Property to Lender or
to such receiver and, in default thereof, Trustor may be evicted by summary
proceedings or otherwise; and (vii) except as otherwise expressly provided for
in the Loan Agreement, apply the receipts from the Property to the payment of
the Debt, in such order, priority and proportions as Lender shall deem
appropriate in its sole discretion after deducting therefrom all expenses
(including reasonable attorneys' fees) incurred in connection with the aforesaid
operations and all amounts necessary to pay the Taxes, Other Charges, Insurance
Premiums and other expenses in connection with the Property, as well as just and
reasonable compensation for the services of Lender, its outside counsel, agents
and employees;
(i) exercise any and all rights and remedies granted to a secured party
upon default under the Uniform Commercial Code, including, without limiting the
generality of the foregoing: (i) the right to take possession of any Collateral
(including, without limitation, the Personal Property) or any part thereof, and
to take such other measures as Lender or Trustee may deem necessary for the
care, protection and preservation of the Collateral (including without
limitation, the Personal Property), and (ii) request Trustor at its expense to
assemble the Collateral,
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including without limitation, the Personal Property, and make it available to
Lender at a convenient place acceptable to Lender. Any notice of sale,
disposition or other intended action by Lender or Trustee with respect to the
Collateral, including without limitation, the Personal Property, sent to Trustor
in accordance with the provisions hereof at least five (5) days prior to such
action, shall constitute commercially reasonable notice to Trustor;
(j) apply any sums then deposited in the Accounts and any other sums
held in escrow or otherwise by Lender in accordance with the terms of this
Security Instrument, the Loan Agreement, or any other Loan Documents to the
payment of the following items in any order in its sole discretion:
(i) Taxes and Other Charges;
(ii) Insurance Premiums;
(iii) interest on the unpaid principal balance of the Note;
(iv) amortization of the unpaid principal balance of the Note; or
(v) all other sums payable pursuant to the Note, the Loan
Agreement, this Security Instrument and the other Loan Documents,
including without limitation advances made by Lender pursuant to the
terms of this Security Instrument;
(k) surrender the Policies, collect the unearned Insurance Premiums and
apply such sums as a credit on the Debt in such priority and proportion as
Lender in its discretion shall deem proper, and in connection therewith, Trustor
hereby appoints Lender as agent and attorney-in-fact (which is coupled with an
interest and is therefore irrevocable) for Trustor to collect such Insurance
Premiums;
(l) apply the undisbursed balance of any Net Proceeds Deficiency
deposit, together with interest thereon, to the payment of the Debt in such
order, priority and proportions as Lender shall deem to be appropriate in its
discretion;
(m) foreclose by power of sale or otherwise and apply the proceeds of
any recovery to the Debt in accordance with Section 9.2 or to any deficiency
under this Security Instrument;
(n) exercise all rights and remedies under any Causes of Action,
whether before or after any sale of the Property by foreclosure, power of sale,
or otherwise and apply the proceeds of any recovery to the Debt in accordance
with Section 9.2 or to any deficiency under this Security Instrument; or
(o) pursue such other remedies as Lender may have under Applicable Law.
In the event of a sale, by foreclosure, power of sale, or otherwise, of less
than all of the Property, this Security Instrument shall continue as a lien and
security interest on the remaining portion of the Property unimpaired and
without loss of priority.
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SECTION 9.2 APPLICATION OF PROCEEDS. Except as otherwise expressly set
forth in the Loan Agreement, the purchase money, proceeds and avails of any
disposition of the Property, or any part thereof, or any other sums collected by
Lender pursuant to the Note, this Security Instrument, the Loan Agreement, or
the other Loan Documents, may be applied by Lender to the payment of the Debt in
such priority and proportions as Lender in its discretion shall deem proper.
SECTION 9.3 RIGHT TO CURE DEFAULTS. Upon the occurrence and during the
continuance of any Default or Event of Default Lender may, but without any
obligation to do so and without notice to or demand on Trustor and without
releasing Trustor from any obligation hereunder, make or do the same in such
manner and to such extent as Lender may deem necessary to protect the security
hereof. Lender or Trustee is authorized to enter upon the Property for such
purposes, or appear in, defend, or bring any action or proceeding to protect its
interest in the Property or to foreclose this Security Instrument or collect the
Debt. The cost and expense of any cure hereunder (including reasonable
attorneys' fees to the extent permitted by law), with interest as provided
below, shall constitute a portion of the Debt and shall be due and payable to
Lender or Trustee upon demand. All such costs and expenses incurred by Lender in
remedying such Default or Event of Default shall bear interest at the Default
Rate for the period after notice from Lender that such cost or expense was
incurred to the date of payment to Lender and shall be deemed to constitute a
portion of the Debt and be secured by this Security Instrument and the other
Loan Documents and shall be immediately due and payable upon demand by Lender
therefor.
SECTION 9.4 ACTIONS AND PROCEEDINGS. Lender or Trustee has the right to
appear in and defend any action or proceeding brought with respect to the
Property and, after the occurrence and during the continuance of an Event of
Default, to bring any action or proceeding, in the name and on behalf of
Trustor, which Lender, in its discretion, decides should be brought to protect
its interest in the Property.
SECTION 9.5 RECOVERY OF SUMS REQUIRED TO BE PAID. Lender shall have the
right from time to time to take action to recover any sum or sums which
constitute a part of the Debt as the same become due, without regard to whether
or not the balance of the Debt shall be due, and without prejudice to the right
of Lender or Trustee thereafter to bring an action of foreclosure, or any other
action, for a Default or Defaults by Trustor existing at the time such earlier
action was commenced.
SECTION 9.6 OTHER RIGHTS, ETC. (a) The failure of Lender or Trustee to
insist upon strict performance of any term hereof shall not be deemed to be a
waiver of any term of this Security Instrument. Trustor shall not be relieved of
Trustor's obligations hereunder by reason of (i) the failure of Lender or
Trustee to comply with any request of Trustor to take any action to foreclose
this Security Instrument or otherwise enforce any of the provisions hereof or of
the Note or the other Loan Documents, (ii) the release, regardless of
consideration, of the whole or any part of the Property, or of any person liable
for the Debt or any portion thereof, or (iii) any agreement or stipulation by
Lender or Trustee extending the time of payment or otherwise modifying or
supplementing the terms of the Note, the Loan Agreement, this Security
Instrument or the other Loan Documents.
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(a) It is agreed that the risk of loss or damage to the Property is on
Trustor, and neither Lender nor Trustee shall have any liability whatsoever for
decline in value of the Property, for failure to maintain the Policies, or for
failure to determine whether insurance in force is adequate as to the amount of
risks insured. Possession by Lender or Trustee shall not be deemed an election
of judicial relief, if any such possession is requested or obtained, with
respect to the Property or any other Collateral not in Lender's or Trustee's
possession.
(b) Lender may resort for the payment of the Debt to any other security
held by Lender in such order and manner as Lender, in its discretion, may elect.
Lender or Trustee may take action to recover the Debt, or any portion thereof,
or to enforce any covenant hereof without prejudice to the right of Lender or
Trustee thereafter to foreclose this Security Instrument. The rights of Lender
and Trustee under this Security Instrument shall be separate, distinct and
cumulative and none shall be given effect to the exclusion of the others. No act
of Lender or Trustee shall be construed as an election to proceed under any one
provision herein to the exclusion of any other provision. Neither Lender nor
Trustee shall be limited exclusively to the rights and remedies herein stated
but shall be entitled to every right and remedy now or hereafter afforded at law
or in equity.
SECTION 9.7 RIGHT TO RELEASE ANY PORTION OF THE PROPERTY. Lender may
release any portion of the Property for such consideration as Lender may require
without, as to the remainder of the Property, in any way impairing or affecting
the lien or priority of this Security Instrument, or improving the position of
any subordinate lienholder with respect thereto, except to the extent that the
obligations hereunder shall have been reduced by the actual monetary
consideration, if any, received by Lender for such release, and may accept by
assignment, pledge or otherwise any other property in place thereof as Lender
may require without being accountable for so doing to any other lienholder. This
Security Instrument shall continue as a lien and security interest in the
remaining portion of the Property.
SECTION 9.8 VIOLATION OF LAWS. If the Property is not in compliance
with Legal Requirements, Lender may impose reasonable additional requirements
upon Trustor in connection herewith including, without limitation, monetary
reserves or financial equivalents.
SECTION 9.9 RIGHT OF ENTRY. Subject to the terms of the Loan Agreement,
Lender and its agents shall have the right to enter and inspect the Property at
all reasonable times.
SECTION 9.10 SUBROGATION. If any or all of the proceeds of the Note
have been used to extinguish, extend or renew any indebtedness heretofore
existing against the Property, then, to the extent of the funds so used, Lender
shall be subrogated to all of the rights, claims, liens, titles, and interests
existing against the Property heretofore held by, or in favor of, the holder of
such indebtedness and such former rights, claims, liens, titles, and interests,
if any, are not waived but rather are continued in full force and effect in
favor of Lender and are merged with the lien and security interest created
herein as cumulative security for the repayment of the Debt, and the performance
and discharge of the Obligations.
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ARTICLE 10 - INDEMNIFICATIONS
SECTION 10.1 GENERAL INDEMNIFICATION. Trustor shall, at its sole cost
and expense, protect, defend, indemnify, release and hold harmless the
Indemnified Parties from and against any and all Losses imposed upon or incurred
by or asserted against any Indemnified Parties and directly or indirectly
arising out of or in any way relating to any one or more of the following: (a)
any accident, injury to or death of persons or loss of or damage to property
occurring in, on or about the Property or any part thereof or on the adjoining
sidewalks, curbs, adjacent property or adjacent parking areas, streets or ways;
(b) any use, nonuse or condition in, on or about the Property or any part
thereof or on the adjoining sidewalks, curbs, adjacent property or adjacent
parking areas, streets or ways; (c) performance of any labor or services or the
furnishing of any materials or other property in respect of the Property or any
part thereof; (d) any failure of the Property to be in compliance with any Legal
Requirements; (e) any and all claims and demands whatsoever which may be
asserted against Lender by reason of any alleged obligations or undertakings on
its part to perform or discharge any of the terms, covenants, or agreements
contained in any Lease; or (f) the payment of any commission, charge or
brokerage fee to anyone which may be payable in connection with the funding of
the Loan evidenced by the Note and secured by this Security Instrument. Any
amounts payable to Lender by reason of the application of this Section 10.1
shall become immediately due and payable and shall bear interest at the Default
Rate from the date loss or damage is sustained by Lender until paid.
SECTION 10.2 MORTGAGE AND/OR INTANGIBLE TAX. Trustor shall, at its sole
cost and expense, protect, defend, indemnify, release and hold harmless the
Indemnified Parties from and against any and all Losses imposed upon or incurred
by or asserted against any Indemnified Parties and directly or indirectly
arising out of or in any way relating to any tax on the making and/or recording
of this Security Instrument, the Loan Agreement, the Note or any other Loan
Document.
SECTION 10.3 ENVIRONMENTAL INDEMNITY. Simultaneously with this Security
Instrument, Trustor and Indemnitor have executed and delivered the Environmental
Indemnity.
ARTICLE 11 - WAIVERS
SECTION 11.1 WAIVER OF COUNTERCLAIM. Trustor hereby waives the right to
assert a counterclaim, other than a mandatory or compulsory counterclaim, in any
action or proceeding brought against it by Lender arising out of or in any way
connected with this Security Instrument, the Note, the Loan Agreement, any of
the other Loan Documents, or the Obligations.
SECTION 11.2 MARSHALLING AND OTHER MATTERS. Trustor hereby waives, to
the extent permitted by law, the benefit of all appraisement, valuation, stay,
extension, reinstatement and redemption laws now or hereafter in force and all
rights of marshalling in the event of any sale hereunder of the Property or any
part thereof or any interest therein. Further, Trustor hereby expressly waives
any and all rights of redemption from sale under any order or decree of
foreclosure of this Security Instrument on behalf of Trustor, and on behalf of
each Person acquiring any interest in or title to the Property subsequent to the
date of this Security Instrument and on behalf of all persons to the extent
permitted by Legal Requirements.
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SECTION 11.3 WAIVER OF NOTICE. Trustor shall not be entitled to any
notices of any nature whatsoever from Lender or Trustee except (a) with respect
to matters for which this Security Instrument, the Loan Agreement or any other
Loan Document, specifically and expressly provides for the giving of notice by
Lender or Trustee to Trustor, and (b) with respect to matters for which Lender
or Trustee is required by any Applicable Law to give notice, and Trustor hereby
expressly waives the right to receive any notice from Lender or Trustee with
respect to any matter for which this Security Instrument does not specifically
and expressly provide for the giving of notice by Lender or Trustee to Trustor.
SECTION 11.4 WAIVER OF STATUTE OF LIMITATIONS. Trustor hereby expressly
waives and releases to the fullest extent permitted by law, the pleading of any
statute of limitations as a defense to payment of the Debt or performance of its
Other Obligations.
SECTION 11.5 SOLE DISCRETION OF LENDER. Wherever pursuant to this
Security Instrument (a) Lender exercises any right given to it to approve or
disapprove, (b) any arrangement or term is to be satisfactory to Lender, or (c)
any other decision or determination is to be made by Lender, the decision of
Lender to approve or disapprove, all decisions that arrangements or terms are
satisfactory or not satisfactory and all other decisions and determinations made
by Lender, shall be in the sole and absolute discretion of Lender, except as may
be otherwise expressly and specifically provided herein or in any of the other
Loan Documents.
ARTICLE 12 - EXCULPATION
SECTION 12.1 EXCULPATION. Notwithstanding anything to the contrary
contained in this Security Instrument, the liability of any party to this
Security Instrument to pay the Debt and for the performance of the other
agreements, covenants and obligations contained herein and in the Note, the Loan
Agreement and the other Loan Documents shall be limited as set forth in Section
9.4 of the Loan Agreement.
ARTICLE 13 - SUBMISSION TO JURISDICTION
SECTION 13.1 SUBMISSION TO JURISDICTION. With respect to any claim or
action arising hereunder or under the Note or the other Loan Documents, Trustor
(a) irrevocably submits to the nonexclusive jurisdiction of the courts of the
State of New York and the United States District Court located in the Borough of
Manhattan in New York, New York, and appellate courts from any thereof, and (b)
irrevocably waives any objection which it may have at any time to the laying on
venue of any suit, action or proceeding arising out of or relating to this
Security Instrument brought in any such court, irrevocably waives any claim that
any such suit, action or proceeding brought in any such court has been brought
in an inconvenient forum. Nothing in this Security Instrument will be deemed to
preclude Lender from bringing an action or proceeding with respect hereto in any
other jurisdiction.
ARTICLE 14 - APPLICABLE LAW
SECTION 14.1 CHOICE OF LAW. THIS SECURITY INSTRUMENT SHALL BE DEEMED TO
BE A CONTRACT ENTERED INTO PURSUANT TO THE LAWS OF THE STATE OF NEW YORK AND
SHALL IN ALL RESPECTS BE GOVERNED, CONSTRUED,
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APPLIED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
PROVIDED HOWEVER, THAT WITH RESPECT TO THE CREATION, PERFECTION, PRIORITY AND
ENFORCEMENT OF THE LIEN OF THIS SECURITY INSTRUMENT, AND THE DETERMINATION OF
DEFICIENCY JUDGMENTS, THE LAWS OF THE STATE WHERE THE PROPERTY IS LOCATED SHALL
APPLY.
SECTION 14.2 PROVISIONS SUBJECT TO APPLICABLE LAW. All rights, powers
and remedies provided in this Security Instrument may be exercised only to the
extent that the exercise thereof does not violate any applicable provisions of
law and are intended to be limited to the extent necessary so that they will not
render this Security Instrument invalid, unenforceable or not entitled to be
recorded, registered or filed under the provisions of any Legal Requirements.
ARTICLE 15 - DEFINITIONS
SECTION 15.1 GENERAL DEFINITIONS. Unless the context clearly indicates
a contrary intent or unless otherwise specifically provided herein, words used
in this Security Instrument may be used interchangeably in singular or plural
form and the word "Trustor" shall mean "each Trustor and any subsequent owner or
owners of the Property or any part thereof or any interest therein," the word
"Lender" shall mean "Lender and any subsequent holder of the Note," the word
"Trustee" shall mean "Trustee and any substitute Trustee of the estates,
properties, powers, trusts and rights conferred upon Trustee pursuant to this
Security Instrument," the word "Note" shall mean "the Note and any other
evidence of indebtedness secured by this Security Instrument," the word
"Property" shall include any portion of the Property and any interest of Trustor
therein, and the phrases "legal fees", "attorneys' fees" and "counsel fees"
shall include any and all attorneys', paralegal and law clerk fees and
disbursements, including, but not limited to, fees and disbursements at the
pre-trial, trial and appellate levels incurred or paid by Lender in protecting
its interest in the Property, the Leases and the Rents and enforcing its rights
hereunder.
SECTION 15.2 HEADINGS, ETC. The headings and captions of various
Articles and Sections of this Security Instrument are for convenience of
reference only and are not to be construed as defining or limiting, in any way,
the scope or intent of the provisions hereof.
ARTICLE 16 - MISCELLANEOUS PROVISIONS
SECTION 16.1 NO ORAL CHANGE. This Security Instrument and any
provisions hereof, may not be modified, amended, waived, extended, changed,
discharged or terminated orally or by any act or failure to act on the part of
Trustor or Lender, but only by an agreement in writing signed by the party
against whom enforcement of any modification, amendment, waiver, extension,
change, discharge or termination is sought.
SECTION 16.2 LIABILITY. If Trustor consists of more than one person,
the obligations and liabilities of each such person hereunder shall be joint and
several. This Security Instrument shall be binding upon and inure to the benefit
of Trustor and Lender and their respective successors and assigns forever.
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SECTION 16.3 INAPPLICABLE PROVISIONS. If any term, covenant or
condition of this Security Instrument or any other Loan Document, is held to be
invalid, illegal or unenforceable in any respect, the Note and this Security
Instrument or the other Loan Documents, as the case may be, shall be construed
without such provision.
SECTION 16.4 DUPLICATE ORIGINALS; COUNTERPARTS. This Security
Instrument may be executed in any number of duplicate originals and each
duplicate original shall be deemed to be an original. This Security Instrument
may be executed in several counterparts, each of which counterparts shall be
deemed an original instrument and all of which together shall constitute a
single Security Instrument. The failure of any party hereto to execute this
Security Instrument, or any counterpart hereof, shall not relieve the other
signatories from their obligations hereunder.
SECTION 16.5 NUMBER AND GENDER. Whenever the context may require, any
pronouns used herein shall include the corresponding masculine, feminine or
neuter forms, and the singular form of nouns and pronouns shall include the
plural and vice versa.
SECTION 16.6 NOTICE. All notices required or permitted under this
Security Instrument shall be given and be effective in accordance with Section
10.6 of the Loan Agreement.
ARTICLE 17 - INTENTIONALLY DELETED
ARTICLE 18 - OPERATING LEASE PROVISIONS
SECTION 18.1 NO MERGER OF FEE AND LEASEHOLD ESTATES; RELEASES. So long
as any portion of the Debt shall remain unpaid, unless Lender shall otherwise
consent, the fee title to the Land and the leasehold estate therein created
under the Operating Lease shall not merge but shall always be kept separate and
distinct, notwithstanding the union of such estates in Operating Lessee, the
lessor thereunder, or in any other Person by purchase, operation of law or
otherwise. Lender reserves the right, at any time, to release portions of the
Property, including, but not limited to, the leasehold estate created by the
Operating Lease, with or without consideration, at Lender's election, without
waiving or affecting any of its rights hereunder or under the Note or the other
Loan Documents and any such release shall not affect Lender's rights in
connection with the portion of the Property not so released.
SECTION 18.2 OPERATING LESSEE EXECUTION. Operating Lessee hereby joins
in the execution and delivery of this Security Instrument for the purpose of
mortgaging its interest in the Land, the Improvements, the Operating Lease and
the Property as set forth in Article 1 of this Security Instrument.
ARTICLE 19 - STATE SPECIFIC PROVISIONS
SECTION 19.1 INCONSISTENCIES. In the event of any inconsistencies
between the terms and conditions of this Article 19 and the other provisions of
this Security Instrument, the terms and conditions of this Article 19 shall
control and be binding.
[STATE SPECIFIC PROVISIONS]
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ARTICLE 20 - DEED OF TRUST PROVISIONS
SECTION 20.1 CONCERNING THE TRUSTEE. Trustee shall be under no duty to
take any action hereunder except as expressly required hereunder or by law, or
to perform any act which would involve Trustee in any expense or liability or to
institute or defend any suit in respect hereof, unless properly indemnified to
Trustee's reasonable satisfaction. Trustee, by acceptance of this Security
Instrument, covenants to perform and fulfill the trusts herein created, being
liable, however, only for gross negligence or willful misconduct, and hereby
waives any statutory fee and agrees to accept reasonable compensation, in lieu
thereof, for any services rendered by Trustee in accordance with the terms
hereof. Trustee may resign at any time upon giving thirty (30) days' notice to
Trustor and to Lender. Lender may remove Trustee at any time or from time to
time and select a successor trustee. In the event of the death, removal,
resignation, refusal to act, or inability to act of Trustee, or in its sole
discretion for any reason whatsoever Lender may, without notice and without
specifying any reason therefor and without applying to any court, select and
appoint a successor trustee, by an instrument recorded wherever this Security
Instrument is recorded and all powers, rights, duties and authority of Trustee,
as aforesaid, shall thereupon become vested in such successor. Such substitute
trustee shall not be required to give bond for the faithful performance of the
duties of Trustee hereunder unless required by Lender. The procedure provided
for in this Section 20.1 for substitution of Trustee shall be in addition to and
not in exclusion of any other provisions for substitution, by law or otherwise.
SECTION 20.2 TRUSTEE'S FEES. Trustor shall pay all reasonable costs,
fees and expenses incurred by Trustee and Trustee's agents and counsel in
connection with the performance by Trustee of Trustee's duties hereunder and all
such costs, fees and expenses shall be secured by this Security Instrument.
SECTION 20.3 CERTAIN RIGHTS. With the approval of Lender, Trustee shall
have the right to take any and all of the following actions: (i) to select,
employ, and advise with counsel (who may be, but need not be, counsel for
Lender) upon any matters arising hereunder, including the preparation,
execution, and interpretation of the Note, this Security Instrument or the other
Loan Documents, and shall be fully protected in relying as to legal matters on
the advice of counsel, (ii) to execute any of the trusts and powers hereof and
to perform any duty hereunder either directly or through his/her agents or
attorneys, (iii) to select and employ, in and about the execution of his/her
duties hereunder, suitable accountants, engineers and other experts, agents and
attorneys-in-fact, either corporate or individual, not regularly in the employ
of Trustee, and Trustee shall not be answerable for any act, default,
negligence, or misconduct of any such accountant, engineer or other expert,
agent or attorney-in-fact, if selected with reasonable area, or for any error of
judgment or act done by Trustee in good faith, or be otherwise responsible or
accountable under any circumstances whatsoever, except for Trustee's gross
negligence or willful misconduct, and (iv) any and all other lawful action as
Lender may instruct Trustee to take to protect or enforce Lender's rights
hereunder. Trustee shall not be personally liable in case of entry by Trustee,
or anyone entering by virtue of the powers herein granted to Trustee, upon the
Property for debts contracted for or liability or damages incurred in the
management or operation of the Property. Trustee shall have the right to rely on
any instrument, document, or signature authorizing or supporting an action taken
or proposed to be taken by Trustee hereunder, believed by Trustee in good faith
to be genuine. Trustee shall be entitled to
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reimbursement for actual expenses incurred by Trustee in the performance of
Trustee's duties hereunder and to reasonable compensation for such of Trustee's
services hereunder as shall be rendered.
SECTION 20.4 RETENTION OF MONEY. All moneys received by Trustee shall,
until used or applied as herein provided, be held in trust for the purposes for
which they were received, but need not be segregated in any manner from any
other moneys (except to the extent required by Applicable Law) and Trustee shall
be under no liability for interest on any moneys received by Trustee hereunder.
SECTION 20.5 PERFECTION OF APPOINTMENT. Should any deed, conveyance, or
instrument of any nature be required from Trustor by any Trustee or substitute
trustee to more fully and certainly vest in and confirm to the Trustee or
substitute trustee such estates rights, powers, and duties, then, upon request
by the Trustee or substitute trustee, any and all such deeds, conveyances and
instruments shall be made, executed, acknowledged, and delivered and shall be
caused to be recorded and/or filed by Trustor.
SECTION 20.6 SUCCESSION INSTRUMENTS. Any substitute trustee appointed
pursuant to any of the provisions hereof shall, without any further act, deed,
or conveyance, become vested with all the estates, properties, rights, powers,
and trusts of its or his/her predecessor in the rights hereunder with like
effect as if originally named as Trustee herein; but nevertheless, upon the
written request of Lender or of the substitute trustee, the Trustee ceasing to
act shall execute and deliver any instrument transferring to such substitute
trustee, upon the trusts herein expressed, all the estates, properties, rights,
powers, and trusts of the Trustee so ceasing to act, and shall duly assign,
transfer and deliver any of the property and moneys held by such Trustee to the
substitute trustee so appointed in the Trustee's place.
[NO FURTHER TEXT ON THIS PAGE]
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IN WITNESS WHEREOF, THIS SECURITY INSTRUMENT has been executed by
Trustor the day and year first above written.
OWNER:
------------------------------,a
Delaware
--------------------
By:
------------------------------
Joel M. Eastman
Vice President
OPERATING LESSEE:
------------------------------,a
Delaware
--------------------
By:
------------------------------
Joel M. Eastman
Vice President
ACKNOWLEDGMENTS
State of )
) ss.:
County of )
On _________, 2004, before me, __________________________________,
personally appeared Joel M. Eastman, personally known to me (or proved to me on
the basis of satisfactory evidence) to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their signature(s) on the instrument the person(s),
or the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
--------------------------------
Signature
ACKNOWLEDGMENTS
State of )
) ss.:
County of )
On __________, 2004, before me, __________________________________,
personally appeared Joel M. Eastman, personally known to me (or proved to me on
the basis of satisfactory evidence) to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their signature(s) on the instrument the person(s),
or the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
--------------------------------
Signature
EXHIBIT A
(Description of Land)