Exhibit 10.6
OPEN-END MORTGAGE
AND
COLLATERAL ASSIGNMENT OF LEASES AND RENTS
THIS MORTGAGE SECURES FUTURE ADVANCES.
NOTICE IS HEREBY GIVEN PURSUANT TO 42 PA.C.S.A. 8143 ET SEQ.: THIS
INSTRUMENT IS AN "OPEN END MORTGAGE" WITHIN THE MEANING OF SAID STATUTE AND
SECURES NOT ONLY INDEBTEDNESS OR ADVANCES MADE CONTEMPORANEOUSLY WITH EXECUTION
HEREOF, BUT ALSO FUTURE ADVANCES, BOTH OBLIGATORY AND OPTIONAL, TO THE SAME
EXTENT AS IF SUCH FUTURE ADVANCES WERE MADE CONTEMPORANEOUSLY WITH THE EXECUTION
HEREOF, EVEN THOUGH NO ADVANCE MAY BE MADE AT THE TIME OF EXECUTION AND/OR
RECORDING HEREOF AND EVEN THOUGH THERE MAY BE NO OUTSTANDING INDEBTEDNESS FOR A
PERIOD OF TIME AFTER AN ADVANCE OR ADVANCES MAY HAVE BEEN MADE AND REPAID. FOR
THE PURPOSES OF SAID SECTION, THE NAME AND ADDRESS OF COLLATERAL AGENT IS SET
FORTH BELOW. THE MAXIMUM AMOUNT OF PRINCIPAL INDEBTEDNESS SECURED HEREBY AT ANY
TIME SHALL NOT EXCEED $400,000,000 PLUS CERTAIN OTHER UNPAID BALANCES OF
ADVANCES, INTEREST AND COSTS AND EXPENSES DESCRIBED BELOW.
THIS OPEN-END MORTGAGE AND COLLATERAL ASSIGNMENT OF LEASES AND RENTS
(hereinafter referred to as this "Mortgage") is made and entered into as of this
11th day of October, 2005, by ELECTRONICS BOUTIQUE OF AMERICA INC., a
corporation organized under the laws of the Commonwealth of Pennsylvania, as
grantor or mortgagor (hereinafter referred to as "Mortgagor"), Mortgagor having
its principal place of business at 931 South Matlack Street, West Chester,
Pennsylvania 19382, in favor of BANK OF AMERICA, N.A., as grantee or mortgagee,
as collateral agent, (in such capacity, the "Collateral Agent") for the benefit
of the Secured Parties, Collateral Agent having an office at 40 Broad Street,
10th Floor, Boston, Massachusetts 02109.
Each capitalized term used herein but not defined herein shall have the
meaning assigned to such term in the Credit Agreement (as defined herein).
W I T N E S S E T H:
A. Reference is made to that certain Credit Agreement dated as of even date
herewith (as the same may be amended, modified, supplemented or restated
hereafter, the "Credit Agreement"), by, among others, (i) the Mortgagor and
certain Affiliates of the Mortgagor (singly, a "Borrower", and collectively, the
"Borrowers"), (ii) the Lenders named therein, (iii) Bank of America, N.A., as
Administrative Agent and Collateral Agent for the Lenders, (iv) Citicorp North
America, Inc., as Syndication Agent, (v) Merrill Lynch Capital, a division of
Merrill Lynch Business Financial Services Inc., as Documentation Agent, (vi)
Bank of America, N.A. and Citicorp North America, Inc., as Issuing Banks, and
(vii) Banc of America Securities LLC, Citigroup Global Markets Inc. and Merrill
Lynch Capital, a Division of Merrill Lynch Business Financial Services Inc., as
Joint Lead Arrangers and Joint Lead Bookrunners.
B. Pursuant to the Credit Agreement, each of the Lenders have agreed to
lend to the Borrowers, on a revolving basis, Revolving Loans, at any time and
from time to time prior to the Termination Date, the Swingline Lender has agreed
to lend, on a revolving basis, Swingline Loans, at any time and from time to
time prior to the Termination Date, and the Issuing Banks have issued and have
agreed to issue Letters of Credit for the benefit of the Borrowers at any time
and from time to time prior to the Termination Date, in each case upon the terms
and subject to the conditions specified in, the Credit Agreement.
C. The obligations of the Lenders to make Loans and of the Issuing Banks to
issue Letters of Credit are conditioned upon, among other things, the execution
and delivery by the Mortgagor of this Mortgage, to secure the due and punctual
payment and performance of the following described indebtedness and obligations:
(a) all Obligations; and (b) any and all additional advances made by any Secured
Party, to the extent made consistent with the terms hereof, to protect or
preserve the Mortgaged Property or the security interest created hereby on the
Mortgaged Property, or for taxes, assessments or insurance premiums as
hereinafter provided or for performance of any of Mortgagor's obligations
hereunder or under the other Loan Documents or for any other purpose provided
herein or in the other Loan Documents (whether or not the original Mortgagor
remains the owner of the Mortgaged Property at the time of such advances)
(hereinafter (a) and (b) shall collectively be referred to as the "Secured
Obligations").
D. Pursuant to the requirements of the Credit Agreement, the Mortgagor is
granting this Mortgage in favor of the Collateral Agent, for the ratable benefit
of the Secured Parties to create a security interest in the Mortgaged Property
(as defined herein) to secure the performance and payment by the Mortgagor of
the Secured Obligations. The Credit Agreement also requires the granting by the
Mortgagor and/or other Borrowers of other mortgages (the "Other Mortgages") that
create security interests in certain mortgaged properties other than the
Property to secure the performance of the Secured Obligations.
GRANTING CLAUSE:
NOW THEREFORE, IN CONSIDERATION OF TEN AND NO/100 DOLLARS ($10.00) AND
OTHER GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency whereof are
hereby acknowledged by Mortgagor, and in order to secure the Secured
Obligations, Mortgagor does hereby grant, bargain, sell, transfer, assign,
mortgage, warrant and convey unto the Collateral Agent, for the ratable benefit
of the Secured Parties, and their respective successors and assigns, with
MORTGAGE COVENANTS, all of the following described property (hereinafter those
items of property described in subparagraphs (a) and (b), below, collectively
referred to as the "Property", and together with the property described in
subparagraphs (c), (d) and (e), collectively, the "Mortgaged Property"):
(a) All those certain tracts or parcels of land described in Exhibit A
attached hereto and by this reference made a part hereof, together with all
right, title and interest of Mortgagor, including any after-acquired title or
reversion, in and to the
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rights-of-ways, streets, and alleys adjacent thereto, and all easements,
rights-of-way, licenses, operating agreements, strips and gores of land, vaults,
streets, ways, alleys, passages, sewers, sewer rights, waters, water courses,
water rights and powers, oil, gas and other minerals, flowers, shrubs, crops,
trees, timber and other emblements now or hereafter located on such land or
under or above same, and all estates, rights, titles, interests, privileges,
liberties, tenements, hereditaments and appurtenances whatsoever, in any way
belonging, relating to or appertaining to said tracts or parcels of land or any
part thereof, or which hereafter shall in any way belong, relate or be
appurtenant thereto, whether now owned or hereafter acquired by Mortgagor and
the reversion and reversions, remainder and remainders, and all the estate,
right, title, interest, property, possession, claim and demand whatsoever at
law, as well as in equity, of the Mortgagor of, in and to the same (hereinafter
referred to as the "Land"); and
(b) All buildings, structures, parking areas, landscaping, fixtures, and
other improvements of every nature now or hereafter situated, erected or placed
on the Land (hereinafter referred to as the "Improvements"); and
(c) All present and future leases, tenancies, occupancies and licenses,
whether written or oral ("Property Leases") of the Land, and the Improvements,
or any combination or part thereof, and all income, rents, issues, royalties,
profits, revenues, security deposits and other benefits of the Land, and the
Improvements, from time to time accruing, all payments under Property Leases,
and all payments on account of oil and gas and other mineral Property Leases,
working interests, production payments, royalties, overriding royalties, rents,
delay rents, operating interests, participating interests and other such
entitlements, and all the estate, right, title, interest, property, possession,
claim and demand whatsoever at law, as well as in equity, of Mortgagor of, in
and to the same (hereinafter referred to as the "Revenues"); and
(d) To the extent assignable, all the right, title and interest of
Mortgagor in and to all construction contracts, subcontracts, architectural
agreements, labor, material and payment bonds, guaranties and warranties, and
plans and specifications relating to the construction of Improvements on the
Land, whether now or hereafter existing, including, without limitation (i) any
architectural or engineering agreement entered into with respect to the design
of said Improvements and other architectural or engineering services, (ii) the
plans and specifications for the construction of said Improvements prepared by
the architect, and (iii) any contractor's agreement entered into with respect to
construction of Improvements on the Land (hereinafter collectively referred to
as the "Contracts"); and
(e) All insurance proceeds and all other proceeds (including all Proceeds
as defined in the UCC), products, substitutions and accessions of the foregoing
of every type.
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TO HAVE AND TO HOLD the Property and all parts, rights, members and
appurtenances thereof, to the use, benefit and behoof of Collateral Agent for
the ratable benefit of the Secured Parties and the successors and assigns of
Collateral Agent, in fee simple forever; and Mortgagor covenants that Mortgagor
is lawfully seized and possessed of the Property and holds marketable fee simple
absolute title to the Property, and in has good right to convey the Property and
that the conveyances in this Mortgage are subject to only to Permitted
Encumbrances. Except for the Permitted Encumbrances, Mortgagor does warrant and
will forever defend the title to the Mortgaged Property against the claims of
all persons whomsoever.
This Mortgage is intended to constitute: (i) a security agreement and
financing statement under the Uniform Commercial Code in effect from time to
time in the Commonwealth of Pennsylvania (the "UCC"), and (ii) a notice of
assignment of rents or profits under law of the Commonwealth of Pennsylvania.
This Mortgage is also intended to operate and be construed as an absolute
present assignment of the rents, issues and profits of the Property, Mortgagor
hereby agreeing, as provided for under law of the Commonwealth of Pennsylvania,
that Collateral Agent is entitled to receive the rents, issues and profits of
the Property prior to an Event of Default and without entering upon or taking
possession of the Property.
This Mortgage is given to secure the payment and performance of the Secured
Obligations, to the extent provided for herein.
Mortgagor hereby further covenants and agrees with Collateral Agent as
follows:
1. Payment and Performance of Secured Obligations.
Mortgagor shall promptly pay the Secured Obligations when due, and fully
and promptly perform all of the provisions, agreements, covenants and
obligations of the Mortgagor, subject to all applicable grace and cure periods.
2. Impositions, Liens and Charges.
Mortgagor shall pay all the yearly water and sewer bills, real estate
taxes, ad valorem taxes, personal property taxes, assessments, betterments,
common area maintenance charges, all governmental charges of every name and
restriction which may be levied on the Property as well as the yearly premium
installments for the insurance covering the Property as required pursuant to
Paragraph 2 hereof (hereinafter collectively referred to as the "Impositions")
and other charges, if any, attributable to the Property, subject to the
Mortgagor's right to contest, provided such contest complies with terms of
Section 5.5 of the Credit Agreement. Mortgagor shall furnish to the Collateral
Agent all bills and notices of amounts due under this Paragraph 2 as soon as
received, and, Mortgagor shall furnish to the Collateral Agent evidence of such
payments at least five (5) days prior to the dates on which such payments are
delinquent for taxes. Mortgagor shall promptly discharge (by bonding, payment or
otherwise) any Lien filed against the Property (other than Permitted
Encumbrances).
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3. Property and Other Insurance. (a) The Mortgagor shall (i) maintain or
shall cause to be maintained insurance with financially sound and reputable
insurers reasonably acceptable to the Collateral Agent on the Property and in at
least such amounts and against at least such risks as is customary with
companies in the same or similar businesses operating in the same or similar
locations, including public liability insurance against claims for personal
injury or death occurring upon, in or about or in connection with the use of any
properties owned, occupied or controlled by it; (ii) maintain such other
insurance as may be required by law; and (iii) furnish to the Collateral Agent,
upon written request, full information as to the insurance carried.
(b) Fire and extended coverage policies maintained with respect to any
Property shall be endorsed or otherwise amended to include (i) a
non-contributing Collateral Agent clause (regarding the Improvements), in form
and substance reasonably satisfactory to the Collateral Agent, which
endorsements or amendments shall provide that the insurer shall pay all proceeds
otherwise payable to the Mortgagor under the policies directly to the Collateral
Agent, (ii) a provision to the effect that none of the Mortgagor, Secured
Parties nor any other Person shall be a co-insurer, and (iii) such other
provisions as the Collateral Agent may reasonably require from time to time to
protect the interests of the Secured Parties. Commercial general liability
policies shall be endorsed to name the Collateral Agent as an additional
insured. Business interruption policies shall name the Collateral Agent as loss
payee and shall be endorsed or amended to include (i) a provision that, from and
after the Closing Date, the insurer shall pay all proceeds the insurer shall pay
all proceeds in excess of $5,000,000 otherwise payable to the Mortgagor under
the policies directly to the Collateral Agent, provided, however, that the
Collateral Agent hereby agrees that prior to the occurrence of an Event of
Default or a Cash Dominion Event, the Collateral Agent shall remit all proceeds
received by Collateral Agent under the policies to Mortgagor, provided further
that after the occurrence of an Event of Default or a Cash Dominion Event, the
Collateral Agent shall apply any proceeds received in accordance with Section
2.22 of the Credit Agreement or Section 6.2 of the Security Agreement, as
applicable, (ii) a provision to the effect that none of the Mortgagors, the
Secured Parties or any other Person shall be a co-insurer and (iii) such other
provisions as the Collateral Agent may reasonably require from time to time to
protect the interests of the Lenders. Each such policy referred to in this
paragraph also shall provide that it shall not be canceled, modified or not
renewed except upon not less than 30 days' prior written notice thereof by the
insurer to the Collateral Agent (giving the Collateral Agent the right to cure
defaults in the payment of premiums). The Mortgagor shall deliver to the
Collateral Agent, prior to the cancellation, modification or nonrenewal of any
such policy of insurance, a copy of a renewal or replacement policy (or other
evidence of renewal of a policy previously delivered to the Collateral Agent)
together with evidence satisfactory to the Collateral Agent of payment of the
premium therefor.
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(c) In the event that the Mortgagor at any time or times shall fail to
obtain or maintain any of the policies of insurance required hereby or to pay
any premium in whole or part relating thereto, the Collateral Agent may, without
waiving or releasing any obligation or liability of the Mortgagor hereunder or
any Default or Event of Default, in its sole discretion, obtain and maintain
such policies of insurance and pay such premium and take any other actions with
respect to as the Collateral Agent deems advisable. All sums disbursed by the
Collateral Agent in connection with this Paragraph 3(c), including reasonable
attorneys' fees, court costs, expenses and other charges relating thereto, shall
be payable, upon demand, by the Mortgagor to the Collateral Agent and shall be
additional Secured Obligations secured hereby.
(d) In the event of any loss or damage to the Property, the Mortgagor shall
give immediate written notice to the insurance carrier and to the Collateral
Agent. Mortgagor hereby irrevocably makes, constitutes and appoints the
Collateral Agent (and all officers, employees or agents designated by the
Collateral Agent) as Mortgagor's true and lawful agent and attorney-in-fact,
whether or not an Event of Default has occurred, to make proof of such loss, to
adjust and compromise any claim under insurance policies, and to appear in and
prosecute any action arising from such insurance policies. Whether or not an
Event of Default has occurred, the Collateral Agent is authorized to collect and
receive insurance proceeds, and to deduct therefrom Collateral Agent's expenses
incurred in the collection of such proceeds. Mortgagor further authorizes the
Collateral Agent, at Collateral Agent's option, whether or not an Event of
Default has occurred, to apply the balance of such proceeds to the payment of
the Secured Obligations in accordance with the terms of the Credit Agreement.
4. Preservation and Maintenance. Mortgagor (a) shall not permit or commit
waste, impairment, or deterioration of the Property or abandon the Property, (b)
shall restore or repair promptly and in a good and workmanlike manner all or any
part of the Property in the event of any damage, injury or loss thereto, to the
equivalent of its condition prior to such damage, injury or loss, or such other
condition as the Collateral Agent may approve in writing, (c) shall keep the
Property, including the Improvements, in good order, repair and tenantable
condition and shall replace fixtures, equipment, machinery and appliances on the
Property when necessary to keep such items in good order, repair, and tenantable
condition, and (d) shall comply with all laws, ordinances, regulations and
requirements of any governmental body, as well as any reciprocal easement
agreements or covenants of record, applicable to the Property, subject to the
Mortgagor's right to contest, provided such contest complies with terms of
Section 5.5 of the Credit Agreement. Mortgagor covenants and agrees to give the
Collateral Agent prompt notice of any non-compliance with such laws, ordinances,
regulations or requirements and of any notice of non-compliance therewith which
it receives or any threatened or pending proceedings in respect thereto or with
respect to the Property. Neither Mortgagor nor any tenant or other person shall
remove, demolish or alter any Improvements now existing or hereafter erected on
the Property, without the prior consent of the Collateral
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Agent, not to be unreasonably withheld, except to the extent the same would
impair the structural integrity or value of the Property.
5. Transfers. Except as otherwise provided in the Credit Agreement,
Mortgagor will not, directly or indirectly, without the prior written consent of
the Collateral Agent in each instance: (a) sell, convey, assign, transfer,
option, mortgage, pledge, hypothecate or dispose of the Mortgaged Property, or
any part thereof or interest therein; or (b) create or suffer to be created or
to exist any Lien, restriction, or attachment of any kind upon the Mortgaged
Property, or any part thereof or interest therein other than the Permitted
Encumbrances.
6. Hazardous Materials Warranties and Indemnification.
(a) Environmental Representations and Warranties of Mortgagor. In addition
to the representations and warranties made in Credit Agreement, Mortgagor
represents and warrants to each Secured Party as follows:
(i) There are no existing or closed underground storage tanks ("USTs") on
the Property (i) from which Hazardous Materials have been released or leaked to
the environment, or (ii) that are not in compliance with all federal, state, and
local laws and regulations covering the installation, operation, maintenance and
abandonment of USTs.
(ii) None of the following will hereafter be brought on or constitute a
part of the Property: friable asbestos or friable asbestos-containing material;
urea formaldehyde insulation; transformers or other equipment which contain
dielectric fluid containing polychlorinated biphenyls; or leaded paint, except
as may be brought on the Property in accordance with law or for use or sale in
connection with the current use of the Property.
(iii) There are no existing or closed sanitary landfills, solid waste
disposal sites, or hazardous waste treatment, storage or disposal facilities on
the Property except as have been disclosed to relevant Governmental Authorities
and as have been regulated, operated, monitored, assessed and (as necessary)
remediated in accordance with law.
(iv) To the best of Mortgagor's knowledge, no pending or current notice has
been issued to Mortgagor by any agency, authority, or unit of government that
Mortgagor has been identified as a potentially responsible party under any
Environmental Law.
(v) To the best of Mortgagor's knowledge, there exists no pending or
current investigation, action, proceeding, or claim by any Governmental
Authority or by any third party which could result in any liability, penalty,
sanction, or judgment under any Environmental Law with respect to any condition,
use or operation of the Property.
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(b) Environmental Covenants of Mortgagor. In addition to the Mortgagor's
covenants in the Credit Agreement, the Mortgagor covenants and agrees with each
Secured Party that Mortgagor shall:
(i) remain in material compliance with all Environmental Laws;
(ii) not store (except in compliance with all Environmental Laws pertaining
thereto), dispose of, release or allow the release of any Hazardous Materials on
the Property;
(iii) neither directly nor indirectly transport or arrange for the
transport of any Hazardous Materials (except in compliance with all
Environmental Laws pertaining thereto); and
(iv) upon the request of the Collateral Agent, if the Collateral Agent has
reason to believe that Hazardous Materials are stored, released or disposed of
on the Property, take all reasonable action (including, without limitation, the
conducting of reasonably scoped environmental assessments at the sole expense of
the Mortgagor in accordance with subparagraph (c) hereof) to confirm that no
Hazardous Materials are stored, released or disposed of on the Property.
(c) Environmental Indemnity. Mortgagor covenants and agrees, at Mortgagor's
sole cost and expense, to indemnify, defend (at trial and appellate levels, and
with attorneys, consultants and experts reasonably acceptable to the Collateral
Agent) and hold each Indemnitee harmless from and against any and all Liens,
damages, losses, liabilities, obligations, settlement payments, penalties,
assessments, citations, directives, claims, litigation, demands, defenses,
judgments, suits, proceedings, costs, disbursements or expenses of any kind or
of any nature whatsoever with respect to any Environmental Liability in
accordance with Section 9.3(b) of the Credit Agreement, including, without
limitation (i) the costs of assessment, containment and/or removal of any and
all Hazardous Materials from all or any portion of the Property as required by
law, (ii) the costs of any actions taken as required by law in response to a
release of any Hazardous Materials on, in, under or affecting all or any portion
of the Property in order to prevent or minimize such release so that it does not
migrate to adjacent properties or cause or threaten significant risk to present
or future public health, safety, welfare or the environment. Indemnitees' rights
under this Paragraph shall be in addition to all other rights of Indemnitees
under this Mortgage and the other Loan Documents and payments by Mortgagor under
this paragraph shall not reduce Mortgagor's obligations and liabilities under
any of the Loan Documents.
(d) Notice to Collateral Agent. If Mortgagor receives any notice or obtains
knowledge of (i) any potential or known release of any Hazardous Materials at or
from the Property, notification of which must be given to any Governmental
Authority under any Environmental Law, or notification of which has, in fact,
been given to any Governmental Authority, or (ii) any complaint, order, citation
or notice with regard to air emissions, water discharges, or any other
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environmental health or safety matter affecting Mortgagor or the Property (an
"Environmental Complaint") from any Person (including, without limitation, the
Environmental Protection Agency), then Mortgagor shall immediately notify the
Collateral Agent orally and in writing of said release or Environmental
Complaint. Upon such notification, the Collateral Agent may, at its election
without regard to whether an Event of Default has occurred, obtain one or more
reasonably scoped environmental assessments of the Property prepared by a
geohydrologist, an independent engineer or other qualified consultant or expert
approved by the Collateral Agent which evaluates or confirms (i) whether any
Hazardous Materials are present in the soil or water at or adjacent to the
Property, and (ii) whether the use and operation of the Property comply
materially with all Environmental Laws. Environmental assessments may include
detailed visual inspections of the Property, including, without limitation, any
and all storage areas, storage tanks, drains, dry wells and leaching areas, and
the taking of soil samples, surface water samples and ground water samples, as
well as such other investigations or analyses as are reasonably necessary or
appropriate for a determination of the compliance of the Property and the use
and operation thereof with all applicable Environmental Laws. All such
environmental assessments shall be at the cost and expense of the Mortgagor. To
the extent necessary to allow the Collateral Agent to obtain the environmental
assessments provided for herein, the Mortgagor agrees that the Collateral Agent
and the representatives and agents of the Collateral Agent shall have a right to
enter upon, visit and inspect the Property, provided that in no event shall the
Collateral Agent's exercise of this right unreasonably interfere with
Mortgagor's use and enjoyment of the Property.
(e) Survival, Assignability, and Transferability.
(i) The warranties, representations and indemnity set forth in this
Paragraph 6 shall survive the payment and performance of the Secured Obligations
and any exercise by Collateral Agent of any remedies under this Mortgage,
including without limitation, any remedy in the nature of foreclosure, and shall
not merge with any deed given by Mortgagor to Collateral Agent or any Secured
Party in lieu of foreclosure.
(ii) It is agreed and intended by Mortgagor and Collateral Agent that the
warranties, representations and indemnity set forth above in this Paragraph 6
may be assigned or otherwise transferred by Collateral Agent to its successors
and assigns and to any subsequent purchasers of all or any portion of the
Property by, through or under Collateral Agent, without notice to Mortgagor and
without any further consent of Mortgagor. To the extent consent or any such
assignment or transfer is required by law, advance consent to any such
assignment or transfer is hereby given by Mortgagor in order to maximize the
extent and effect of such warranties, representations and indemnity given
hereby.
7. Use of Property. Unless required by applicable law or unless the
Collateral Agent has otherwise consented thereto in writing, which consent shall
not be unreasonably withheld or delayed, (i) Mortgagor shall not allow changes
in
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the nature of the occupancy or use for which the Property was intended at the
time this Mortgage was executed, and (ii) Mortgagor shall not initiate a change
in the zoning classification of the Property or subject the Property to
restrictive or negative covenants. Mortgagor shall comply with, observe and
perform all zoning and other laws affecting the Property, all restrictive
covenants affecting the Property, and all licenses and permits affecting the
Property, subject to the Mortgagor's right to contest, provided such contest
complies with terms of Section 5.5 of the Credit Agreement.
8. Protection of Collateral Agent's Security. If Mortgagor fails to perform
the covenants and agreements contained in this Mortgage, or if any action or
proceeding is commenced which affects the Mortgaged Property or title thereto or
the interest of Collateral Agent therein, including, but not limited to, eminent
domain, or code enforcement, then the Collateral Agent, at such Collateral
Agent's option, may make such appearances, disburse such sums and take such
action as the Collateral Agent deems necessary to protect Collateral Agent's
interest herein, including, but not limited to, disbursement of attorneys' fees,
payment, contest or compromise of any Lien which is prior to the Lien of this
Mortgage, and entry upon the Property to make repairs. Any amounts disbursed by
the Collateral Agent pursuant to this Paragraph 8, with interest thereon, shall
become a portion of the Secured Obligations. Unless Mortgagor and the Collateral
Agent agree to other terms of payment, such amounts shall be payable upon notice
from the Collateral Agent to Mortgagor requesting payment thereof and shall bear
interest from the date of disbursement at the default rate payable on Prime Rate
Loans (the "Default Rate") stated in the Credit Agreement unless collection from
Mortgagor of interest at such rate would be contrary to Applicable Law, in which
event such amounts shall bear interest at the highest rate which may be
collected from Mortgagor under Applicable Law. Mortgagor shall have the right to
prepay such amounts in whole or in part at any time. Nothing contained in this
Paragraph 8 shall require the Collateral Agent to incur any expense or do any
act.
9. Condemnation. If the Property or any portion thereof (the loss of which
shall have, in the sole judgment of the Collateral Agent, a material impact on
the use, operation or value of the Property) shall be damaged or taken through
condemnation (which term, when used in this Mortgage, shall include any damage
or taking by any Governmental Authority, quasi-governmental authority, any
Person having the power of condemnation, or any transfer by private sale in lieu
thereof), either temporarily or permanently, then the Collateral Agent shall
have the right to commence, appear in and prosecute any action or proceeding
relating to any condemnation or other taking of the Property and to settle or
compromise any claim in connection with such condemnation or other taking.
Mortgagor hereby irrevocably makes, constitutes and appoints the Collateral
Agent (and all officers, employees or agents designated by the Collateral Agent)
to commence, appear in and prosecute, in the Collateral Agent's name or
Mortgagor's name, any action or proceeding relating to any condemnation or other
taking of the Property and to settle or compromise any claim in connection
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with such condemnation or other taking. The proceeds of any award or claim for
damages, direct or consequential, in connection with any condemnation, or other
taking of the Property, or part thereof, or for conveyances in lieu of
condemnation, are hereby assigned to Collateral Agent. Mortgagor authorizes
Collateral Agent to apply such awards, proceeds or damages, after the deduction
of the Collateral Agent's expenses incurred in the collection of such amounts,
in the manner provided in the Credit Agreement. Mortgagor agrees to execute such
further assignment of any awards, proceeds, damages or claims arising in
connection with such condemnation or injury that the Collateral Agent may
require.
10. Mortgagor and Lien Not Released. From time to time, without affecting
the obligation of Mortgagor or Mortgagor's successors or assigns to pay the
Secured Obligations and to observe the covenants of Mortgagor contained in this
Mortgage and the other Loan Documents, and without affecting the guaranty of any
Person, for payment or performance of the Secured Obligations, and without
affecting the Lien or priority of Lien of this Mortgage on the Mortgaged
Property, the Collateral Agent may, at the Collateral Agent's option, without
giving notice to or obtaining the consent of Mortgagor, Mortgagor's successors
or assigns or of any Facility Guarantor, and without liability on any Secured
Party's part, but subject to the terms and conditions of the Credit Agreement,
grant extensions or postponements of the time for payment of the Secured
Obligations or any part thereof, release anyone liable on any of the Secured
Obligations, accept a renewal note or notes therefor, release from this Mortgage
any part of the Mortgaged Property, take or release other or additional
security, reconvey any part of the Mortgaged Property, consent to any map or
plat or subdivision of the Property, consent to the granting of any easement,
join in any extension or subordination agreement and agree in writing with
Mortgagor to modify the terms and conditions of any Loan Document. Mortgagor
shall pay such title insurance premiums and attorneys' fees as may be incurred,
at the Collateral Agent's option, for any such action if taken at Mortgagor's
request.
11. Forbearance Not Waiver. Any forbearance by the Collateral Agent or any
other Secured Party in exercising any right or remedy hereunder, or otherwise
afforded by Applicable Law, shall not be a waiver of or preclude the exercise of
any right or remedy hereunder. The procurement of insurance or the payment of
taxes or other Liens by the Collateral Agent shall not be a waiver of the
Collateral Agent's right to accelerate the maturity of the Secured Obligations.
The Collateral Agent's receipt of any awards, proceeds or damages under
Paragraphs 3 and 9 hereof shall not operate to cure or waive Mortgagor's default
in payment of the Secured Obligations.
12. Property Leases and Revenues.
(a) As part of the consideration for the Secured Obligations, Mortgagor has
absolutely and unconditionally collaterally assigned and transferred to
Collateral Agent for the ratable benefit of the Secured Parties all of
11
Mortgagor's right, title and interest in and to the Property Leases and the
Revenues, including those now due, past due or to become due by virtue of any
Property Lease for the occupancy or use of all or any part of the Property.
Mortgagor hereby represents and warrants as follows:
(i) Mortgagor is the sole and absolute owner of the entire landlord's or
lessor's interest in the Property Leases and said rents, issues and profits and
shall not assign its interest in, to or under any of the Property Leases or the
Revenues to any person or entity other than the Collateral Agent;
(ii) Mortgagor has made no prior assignment of any of the Property Leases
or with respect to any of said rents, issues or profits; and
(iii) Mortgagor has neither done any act nor omitted to do any act which
might prevent Collateral Agent from, or limit Collateral Agent in, acting under
any of the provisions of this assignment pursuant to this Mortgage.
(b) Mortgagor agrees that neither the foregoing assignment of Property
Leases and Revenues, nor the exercise of any of Collateral Agent's rights and
remedies under Paragraph 17 hereof shall be deemed to make Collateral Agent a
mortgagee-in-possession or otherwise responsible or liable in any manner with
respect to the Property Leases, the Property or the use, occupancy, enjoyment or
operation of all or any portion thereof, unless and until Collateral Agent, in
person or by agent, assumes actual possession thereof. Nor shall the appointment
of any receiver for the Property by any court at the request of Collateral Agent
or by agreement with Mortgagor, or the entering into possession of any part of
the Property by such receiver, be deemed to make Collateral Agent a Collateral
Agent-in-possession or otherwise responsible or liable in any manner with
respect to the Property Leases, the Property or the use, occupancy, enjoyment or
operation of all or any portion thereof.
(c) If the Collateral Agent or a receiver enters upon, takes possession of
and maintains control of the Property, all Revenues thereafter collected shall
be applied first to the costs of taking control of and managing the Property and
collecting the Revenues, including, but not limited to, reasonable attorneys'
fees actually incurred, receiver's fees, premiums on receiver's bonds, costs of
repairs to the Property, premiums on insurance policies, Impositions and other
charges on the Property, and the costs of discharging any obligation or
liability of Mortgagor as landlord, lessor or licensor of the Property and then
to the Secured Obligations, in the manner set forth in the Credit Agreement. The
Collateral Agent and/ or the receiver shall have access to the books and records
used in the operation and maintenance of the Property and shall be liable to
account only for those Revenues actually received. The Collateral Agent shall
not be liable to Mortgagor, anyone claiming under or through Mortgagor or anyone
having an interest in the Property by reason of anything done or left undone by
Collateral Agent pursuant to Paragraph 17 hereof. If the Revenues are not
sufficient to meet the costs of taking control of and managing the Property and
collecting the
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Revenues, any monies expended by the Collateral Agent for such purposes shall
become a portion of the Secured Obligations. Unless the Collateral Agent and
Mortgagor agree in writing to other terms of payment, such amounts shall be
payable upon notice from the Collateral Agent to Mortgagor requesting payment
thereof and shall bear interest from the date of disbursement at the Default
Rate, unless payment of interest at such rate would be contrary to applicable
law, in which event such amounts shall bear interest at the highest rate which
may be collected from Mortgagor under Applicable Law. The entering upon and
taking possession of and maintaining of control of the Property by the
Collateral Agent or the receiver pursuant to the provisions of this Mortgage and
the application of Revenues as provided herein shall not cure or waive any Event
of Default or invalidate any other right or remedy of the Collateral Agent
hereunder.
(d) At the Collateral Agent's request, the Mortgagor shall enter into a
Subordination, Nondisturbance and Attornment Agreement in form and substance
reasonably acceptable to Collateral Agent with respect to all Property Leases
with tenants of the Property which are not Affiliates of the Mortgagor.
13. Property Leases and Collection of Revenues. Mortgagor will not, without
the consent of the Collateral Agent in writing, which consent shall not be
unreasonably withheld or delayed, enter into any Property Lease of all or any
portion of the Property or amend, supplement or otherwise modify, or terminate
or cancel, or accept the surrender of, or consent to the assignment or
subletting of, or grant any concessions to or waive the performance of any
obligations of any tenant, lessee or licensee under, any now existing or future
Property Lease. Mortgagor agrees not to collect or accept the payment of any
Revenues, or other income or profit from, or on account of, any use or occupancy
of the Property, in advance of the time when such payment becomes due unless
such amount is delivered to the Collateral Agent to be applied to the Secured
Obligations, in the manner set forth in the Credit Agreement.
14. Remedies Cumulative. All remedies provided in this Mortgage are
distinct and cumulative to any other right or remedy under this Mortgage or
under the other Loan Documents or afforded by law or equity, and may be
exercised concurrently, independently or successively.
15. Taxation of Mortgages. In the event of the enactment of any law
deducting from the value of the Property any mortgage Lien thereon, or imposing
upon the Collateral Agent the payment of all or part of the taxes, charges or
assessments previously paid by Mortgagor pursuant to this Mortgage, or changing
the law relating to the taxation of mortgages or debts secured by mortgages or
the Collateral Agent's interest in the Property so as to impose new incidents of
tax on the Collateral Agent, then Mortgagor shall pay such taxes or assessments
or shall reimburse the Collateral Agent therefor.
16. Events of Default and Acceleration. The occurrence of any "Event of
Default" as defined in the Credit Agreement, or the delivery of notice from
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Mortgagor pursuant to 42 Pa.C.S.A. 8143 electing to limit the indebtedness
secured hereunder, shall constitute an Event of Default hereunder. If an Event
of Default shall have occurred and be continuing, the Secured Obligations may be
accelerated pursuant to the terms of the Credit Agreement, whereupon the same
shall become immediately due and payable, and without presentment, protest,
demand or other notice of any kind, all of which are hereby expressly waived by
Mortgagor. No omission to exercise such option when entitled to do so shall be
construed as a waiver of such right.
17. Rights and Remedies.
(a) Foreclosure and other Remedies. Upon the occurrence and during the
continuation of any Event of Default, and whether or not the Collateral Agent
shall have accelerated the maturity of the Secured Obligations pursuant to
Paragraph 16 hereof, the Collateral Agent, at its option, may:
(i) institute an action of mortgage foreclosure whether by sale, entry or
in any other manner provided for hereunder or under the laws of the Commonwealth
of Pennsylvania, or take such other action at law or in equity for the
enforcement of this Mortgage and realization on the Mortgaged Property or any
other security herein or elsewhere provided for, as the Applicable Law may
allow, and may proceed therein to final judgment and execution for the entire
unpaid balance of the principal debt, with interest at the rate(s) stipulated in
the Credit Agreement, together with all other sums due from Mortgagor and the
other Borrowers in accordance with the provisions of the Credit Agreement and
this Mortgage, including all sums which may have been loaned by the Collateral
Agent or Lenders to Mortgagor and the other Borrowers after the date of this
Mortgage, all sums which may have been advanced by the Collateral Agent or
Lenders for taxes, water, or sewer rents, other lienable charges or claims,
insurance or repairs or maintenance after the date of this Mortgage (including
the period after the entry of any judgment in mortgage foreclosure or other
judgment entered pursuant to this Mortgage or any other Loan Document), and all
costs of suit, including counsel fees. Mortgagor authorizes the Collateral Agent
at its option to foreclose this Mortgage, subject to the rights of any tenants
under the Property Leases, and the failure to make any such tenants parties
defendant to any such foreclosure proceedings and to foreclose their rights will
not be asserted by Mortgagor as a defense to any proceedings instituted by
Collateral Agent to recover the indebtedness secured hereby or any deficiency
remaining unpaid after the foreclosure sale of the Property; however, nothing
herein contained shall prevent Mortgagor from asserting in any proceedings
disputing the amount of the deficiency or the sufficiency of any bid at such
foreclosure sale that any such tenants adversely affect the value of the
Property;
(ii) either with or without entering upon or taking possession of the
Property, demand, collect and receive any or all Revenues;
(iii) either with or without entering upon or taking possession of the
Property, and without assuming any obligations of Mortgagor thereunder, exercise
the rights of Mortgagor under, use or benefit from, any of the Property Leases;
(iv) in person, by agent or by court-appointed receiver, enter upon, take
possession of, and maintain full control of the Mortgaged Property in order to
perform all acts necessary or appropriate to maintain and operate the Mortgaged
Property, including, but not limited to, the execution, cancellation or
modification of Property Leases, the making of repairs to the Property and the
execution or termination of contracts providing for the management or
maintenance of the Property, all on such terms as the Collateral Agent, in its
sole discretion, deems proper or appropriate;
(v) proceed by a suit or suits in law or in equity or by other appropriate
proceeding to enforce payment of the Secured Obligations or the performance of
any term, covenant, condition or agreement of this Mortgage or the Credit
Agreement or any of the other Loan Documents, or any other right, and to pursue
any other remedy available to it, all as the Collateral Agent shall determine
most effectual for such purposes;
(vi) institute and maintain such suits and proceedings as the Collateral
Agent may deem expedient to prevent any impairment of the Mortgaged Property by
any acts which may be unlawful or in violation of this Mortgage, to preserve or
protects its interest in the Mortgaged Property and the Revenues, and to
restrain the enforcement of or compliance with any legislation or other
governmental enactment, rule or order that would impair the security hereunder
or be prejudicial to the interest of the Collateral Agent;
(vii) apply all or any portion of the Mortgaged Property, or the proceeds
thereof, towards (but not necessarily in complete satisfaction of) the Secured
Obligations, in the manner set forth in the Credit Agreement or the Security
Agreement, as applicable;
(viii) have judgment entered pursuant to any power to confess judgment
contained in this Mortgage;
(ix) exercise any other right or remedy of a mortgagee or Secured Party
under the laws of the Commonwealth of Pennsylvania.
(b) Receiver. If an Event of Default shall have occurred, the Collateral
Agent, upon application to a court of competent jurisdiction, shall be entitled
as a matter of strict right without notice and without regard to the
15
occupancy or value of any security for the Secured Obligations or the solvency
of any party bound for its payment, to the appointment of a receiver to take
possession of the Mortgaged Property and to operate the Property and to collect
and apply the Revenues. The receiver shall have all of the rights and powers
permitted under the laws of the Commonwealth of Pennsylvania. Mortgagor will pay
to the Collateral Agent upon demand, all expenses, including receiver's fees,
attorneys' fees, costs and agent's compensation, incurred pursuant to such
appointment and all such expenses shall be a portion of the Secured Obligations.
(c) Sale or Other Disposition of Mortgaged Property. Mortgagor waives any
right to require the marshaling of any of its assets in connection with any
disposition conducted pursuant hereto. In the event all or part of the Mortgaged
Property is included at any foreclosure sale conducted pursuant hereto, a single
total price for the Mortgaged Property, or such part thereof as is sold, may be
accepted by the Collateral Agent with no obligation to distinguish between the
application of such proceeds amongst the property comprising the Mortgaged
Property.
(d) Collection of Revenues. In connection with the exercise by Collateral
Agent of the rights and remedies provided for in subparagraph (a)(ii) of this
Paragraph 17:
(i) Collateral Agent may notify any tenant, lessee or licensee of the
Property, either in the name of Collateral Agent or Mortgagor, to make payment
of Revenues directly to Collateral Agent or Collateral Agent's agents, may
advise any person of Collateral Agent's interest in and to the Revenues, and may
collect directly from such tenants, lessees and licensees all amounts due on
account of the Revenues;
(ii) At Collateral Agent's request, Mortgagor will provide written
notification to any or all tenants, lessees and licensees of the Property
concerning Collateral Agent's interest in the Revenues and will request that
such tenants, lessees and licensees forward payment thereof directly to
Collateral Agent;
(iii) Mortgagor shall hold any proceeds and collections of any of the
Revenues in trust for Collateral Agent and shall not commingle such proceeds or
collections with any other funds of Mortgagor; and
(iv) Mortgagor shall deliver all such proceeds to Collateral Agent
immediately upon the receipt thereof by Mortgagor in the identical form
received, but duly endorsed or assigned on behalf of Mortgagor to Collateral
Agent.
(e) CONFESSION OF JUDGMENT. FOR THE PURPOSE OF PROCURING POSSESSION OF THE
PROPERTY IN THE EVENT OF ANY DEFAULT HEREUNDER OR UNDER THE CREDIT AGREEMENT,
16
MORTGAGOR HEREBY AUTHORIZES AND EMPOWERS ANY ATTORNEY OF ANY COURT OF RECORD IN
THE COMMONWEALTH OF PENNSYLVANIA OR ELSEWHERE, AS ATTORNEY FOR MORTGAGOR AND ALL
PERSONS CLAIMING UNDER OR THROUGH MORTGAGOR, TO APPEAR FOR AND CONFESS JUDGMENT
IN EJECTMENT FOR POSSESSION OF THE PROPERTY AGAINST MORTGAGOR, AND AGAINST ALL
PERSONS CLAIMING UNDER OR THROUGH MORTGAGOR, FOR THE RECOVERY BY COLLATERAL
AGENT OF POSSESSION OF THE SAME, WITHOUT ANY STAY OF EXECUTION, FOR WHICH THIS
MORTGAGE, OR A COPY THEREOF VERIFIED BY AFFIDAVIT, SHALL BE A SUFFICIENT
WARRANT; AND THEREUPON A WRIT OF POSSESSION MAY BE ISSUED FORTHWITH, WITHOUT ANY
PRIOR WRIT OR PROCEEDING WHATSOEVER. MORTGAGOR HEREBY RELEASES COLLATERAL AGENT
FROM ALL ERRORS AND DEFECTS WHATSOEVER IN ENTERING SUCH ACTION AND JUDGMENT AND
IN CAUSING SUCH WRIT OR WRITS TO BE ISSUED, AND HEREBY AGREES THAT NO WRIT OR
ERROR, APPEAL, PETITION TO OPEN OR STRIKE OFF JUDGMENT, OR OTHER OBJECTION SHALL
BE FILED OR MADE WITH RESPECT THERETO. IF FOR ANY REASON AFTER SUCH ACTION HAS
BEEN COMMENCED THE SAME SHALL BE DISCONTINUED OR POSSESSION OF THE PROPERTY
SHALL REMAIN IN OR BE RESTORED TO MORTGAGOR, COLLATERAL AGENT SHALL HAVE THE
RIGHT FOR THE SAME DEFAULT OR ANY SUBSEQUENT DEFAULT TO BRING ONE OR MORE
FURTHER ACTIONS AS ABOVE PROVIDED TO RECOVER POSSESSION OF THE PROPERTY.
COLLATERAL AGENT MAY BRING SUCH ACTION IN EJECTMENT BEFORE OR AFTER THE
INSTITUTION OF FORECLOSURE PROCEEDINGS UPON THIS MORTGAGE, OR AFTER JUDGMENT
THEREON OR ON THE CREDIT AGREEMENT, OR AFTER A SALE OF THE PROPERTY BY THE
SHERIFF.
(f) Additional Waivers by Mortgagor. Mortgagor hereby expressly waives and
releases (a) all technical errors, defects and imperfections in any proceedings
instituted by Collateral Agent under this Security Instrument; (b) all benefits
that might accrue to Mortgagor by virtue of any present or future laws exempting
the Property or any part of the proceeds arising from any sale thereof from
attachment, levy or sale under execution, or providing for any stay of
execution, exemption from civil process, or extension of time for payment; and
(c) any present or future statue of limitation or moratorium law or any other
present or future law, regulation or judicial decision which provides for any
stay of execution, marshaling of assets, exemption from civil process,
redemption, extension of time for payment or valuation or appraisement of any of
the Property.
(g) Use and Occupation of Property. In connection with the exercise of
Agent's rights under Subparagraph (a)(v) of this Paragraph 17, the Collateral
Agent may enter upon, occupy, and use all or any part of the Property and may
17
exclude Mortgagor from the Land and the Improvements or portion thereof as may
have been so entered upon, occupied, or used. In the event Collateral Agent
manages the Land and the Improvements in accordance with Subparagraph (a)(vi)
herein, Mortgagor shall pay to the Collateral Agent on demand a reasonable fee
for the management thereof in addition to the Secured Obligations. Further, the
Collateral Agent may make such alterations, renovations, repairs, and
replacements to the Improvements, as the Collateral Agent, in its sole
discretion, deems proper or appropriate. The obligation of Mortgagor to pay such
amounts and all expenses incurred by Collateral Agent in the exercise of its
rights hereunder shall be included in the Secured Obligations and shall accrue
interest at the Default Rate, unless collection from Mortgagor of interest at
such rate would be contrary to applicable law, in which event such amounts shall
bear interest at the highest rate which may be collected from Mortgagor under
applicable law.
(h) Partial Sales. Mortgagor agrees that in case Collateral Agent, in the
exercise of the power of sale contained herein or in the exercise of any other
rights hereunder given, elects to sell in parts or parcels, said sales may be
held from time to time and that the power shall not be exhausted until all of
the Mortgaged Property not previously sold shall have been sold, notwithstanding
that the proceeds of such sales exceed, or may exceed, the Secured Obligations.
(i) Post Judgment Remedies. Mortgagor authorizes the Collateral Agent, at
its option after entry of any judgment in mortgage foreclosure pursuant to this
Mortgage, and/or any judgment, by confession or otherwise, pursuant to the
Credit Agreement, to petition, the court to which such judgment was entered to
reassess damages and/or modify such judgment to include (i) all sums which may
have been advanced or paid by Collateral Agent after the entry of such judgment
for, or are otherwise due and payable for, taxes, water and sewer rents, other
lienable charges or claims, attorneys' fees and costs, insurance for or repairs
to or maintenance of the Property, and (ii) additional accrued interest at the
highest rate of interest provided for under the Credit Agreement.
(j) Assembly of Mortgaged Property. Upon the occurrence of any Event of
Default, the Collateral Agent may require Mortgagor to assemble that portion of
the Mortgaged Property consisting of personal property and make it available to
Collateral Agent, at Mortgagor's sole risk and expense, at a place or places to
be designated by Collateral Agent which are reasonably convenient to both
Collateral Agent and Mortgagor.
(k) Power of Attorney. Mortgagor hereby irrevocably constitutes and
appoints Collateral Agent as Mortgagor's true and lawful attorney in fact,
exercisable only after the occurrence of and during the continuance of an Event
of Default, to take any action with respect to the Mortgaged Property to
preserve, protect, or realize upon Collateral Agent's interest therein, each at
the sole risk, cost and expense of Mortgagor, but for the sole benefit of the
Collateral Agent. The rights and powers granted the Collateral Agent by the
within appointment include, but are not limited to, the right and power to: (i)
prosecute, defend,
18
compromise, settle, or release any action relating to the Mortgaged Property;
(ii) endorse the name of Mortgagor in favor of Collateral Agent upon any and all
checks or other items constituting Revenues; (iii) enter into leases or
subleases relative to all or a portion of the Land or the Improvements; (iv)
enter into any contracts or agreements relative to, and to take all action
deemed necessary in connection with, the construction of any Improvements on the
Land; (v) manage, operate, maintain, or repair the Land and the Improvements
pursuant to Contracts or otherwise; and (vi) exercise the rights of Mortgagor
under any Property Leases or any Contracts. The Collateral Agent shall not be
obligated to perform any of such acts or to exercise any of such powers, but if
the Collateral Agent elects so to perform or exercise, Collateral Agent shall
not be accountable for more than it actually receives as a result of such
exercise of power, and shall not be responsible to Mortgagor except for
Collateral Agent's willful misconduct, gross negligence or bad faith, as
determined by a court of competent jurisdiction by final and nonappealable
judgment. All powers conferred upon the Collateral Agent by this Mortgage (which
shall only be exercised only after the occurrence of and during the continuance
of an Event of Default), being coupled with an interest, shall be irrevocable
until terminated by a written instrument executed by a duly authorized officer
of the Collateral Agent.
18. Notices. Any and all notices, demands, elections or requests provided
for or permitted to be given pursuant to this Mortgage shall be given or served
as provided in Section 9.1 of the Credit Agreement.
19. Successors and Assigns Bound; Captions. The covenants and agreements
herein contained shall bind, and the rights hereunder shall inure to, the
respective successors and assigns of Collateral Agent and Mortgagor, subject to
the provisions of Paragraph 6 hereof. The captions and headings of the
paragraphs of this Mortgage are for convenience only and are not to be used to
interpret or define the provisions hereof.
20. Governing Law; Severability. This Mortgage and the obligations of
Mortgagor hereunder shall be governed by and interpreted and determined in
accordance with the laws of the State of New York except that the creation,
governance, administration and enforcement of Liens and rights and remedies with
respect to the Property shall be governed by and interpreted in accordance with
the laws of the Commonwealth of Pennsylvania. In the event that any provision or
clause of this Mortgage or any other Loan Document conflicts with Applicable
Law, such conflict shall not affect other provisions of this Mortgage or such
Loan Document which can be given effect without the conflicting provision, and
to this end, the provisions of this Mortgage and the other Loan Documents are
declared to be severable. In the event that any Applicable Law limiting the
amount of interest or other charges permitted to be collected from Mortgagor is
interpreted by a court of competent jurisdiction in a final order so that any
charge for which provision is made in this Mortgage or in the other Loan
Documents, whether considered separately or together with other charges
permitted to be collected from Mortgagor, is interpreted so that any such
charge, whether
19
considered separately or together with other charges that are considered a part
of the transaction represented by this Mortgage and the other Loan Documents,
violates such law, and Mortgagor is entitled to the benefit of such law, such
charge is hereby reduced to the extent necessary to eliminate such violation.
The amounts, if any, previously paid to the Collateral Agent in excess of the
amounts payable to the Collateral Agent pursuant to such charges as reduced
shall be applied by the Collateral Agent to reduce the principal of the Secured
Obligations.
21. Discharge. This Agreement shall terminate and the Collateral Agent
shall discharge this Mortgage when all the Secured Obligations have been
indefeasibly paid in full, the Lenders have no further commitment to lend, there
are no Letter of Credit Outstandings and the Issuing Banks have no further
commitment to issue Letters of Credit under the Credit Agreement. Mortgagor
shall pay Collateral Agent's reasonable costs incurred in discharging this
Mortgage.
22. Waivers. (a) Mortgagor agrees to the full extent permitted by law, that
in case of an Event of Default hereunder, neither Mortgagor nor anyone claiming
through or under Mortgagor shall or will set up, claim or seek to take advantage
of any appraisement, valuation, stay, extension, homestead, exemption or
redemption laws now or hereafter in force, in order to prevent or hinder the
enforcement or foreclosure of this Mortgage, or the absolute sale of the
Mortgaged Property, or the final and absolute putting into possession thereof,
immediately after such sale, of the purchasers thereat, and Mortgagor, for
Mortgagor and all who may at any time claim through or under Mortgagor, hereby
waives to the fullest extent that Mortgagor may lawfully so do, the benefit of
all such laws, and any and all right to have the assets comprised in the
security intended to be created hereby marshaled upon any foreclosure of the
Lien hereof.
(b) No failure or delay of the Collateral Agent in exercising any power or
right hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Collateral Agent hereunder are cumulative and are not
exclusive of any rights or remedies that the Collateral Agent would otherwise
have. No waiver of any provisions of this Agreement or any other Loan Document
or consent to any departure by Mortgagor therefrom shall in any event be
effective unless the same shall be permitted by paragraph (c) below, and then
such waiver or consent shall be effective only in the specific instance and for
the purpose for which given. No notice to or demand on the Mortgagor in any case
shall entitle the Mortgagor to any other or further notice or demand in similar
or other circumstances.
(c) Neither this Mortgage nor any provision hereof may be waived, amended
or modified except pursuant to an agreement or agreements in writing entered
into by the Collateral Agent and the Mortgagor with respect to which such
waiver, amendment or modification is to apply, subject to any consent required
in accordance with Section 9.2 of the Credit Agreement.
20
(d) In the event of the sale or transfer by operation of law or otherwise
of all or any part of the Mortgaged Property, the Collateral Agent, without
notice, is hereby authorized and empowered to deal with any such vendee or
transferee with reference to the Mortgaged Property or the Secured Obligations
or with reference to any of the terms, covenants, conditions or agreements
hereof, as fully and to the same extent as it might deal with the original
parties hereto and without in any way releasing or discharging any liabilities,
obligations or undertakings (including, without limitation, the restrictions
upon transfer contained in Paragraph 5).
23. Further Assurances. At any time and from time to time, upon request by
the Collateral Agent, Mortgagor will make, execute and deliver, or cause to be
made, executed and delivered, to the Collateral Agent and, where appropriate,
cause to be recorded and/or filed and from time to time thereafter to be
re-recorded and/or refiled at such time and in such offices and places as shall
be deemed desirable by the Collateral Agent, any and all such other and further
assignments, mortgages, security agreements, financing statements, continuation
statements, instruments of further assurance, certificates and other documents
as may, in the opinion of the Collateral Agent, be necessary or desirable in
order to effectuate, complete, or perfect, or to continue and preserve (a) the
obligations of Mortgagor under this Mortgage, and (b) the Lien created by this
Mortgage upon the Mortgaged Property. Upon any failure by Mortgagor so to do,
the Collateral Agent may make, execute, record, file, re-record and/or refile
any and all such assignments, mortgages, security agreements, financing
statements, continuation statements, instruments, certificates, and documents
for and in the name of Mortgagor, and Mortgagor hereby irrevocably appoints the
Collateral Agent the agent and attorney in fact of Mortgagor so to do.
24. Subrogation. The Collateral Agent shall be subrogated to all right,
title, Lien or equity of all persons to whom Collateral Agent may have paid any
monies in settlement of Liens or in acquisition of title or for its benefit
hereunder, or for the benefit or account of Mortgagor or subsequently paid under
any provisions hereof.
25. Time of the Essence. Time is of the essence with respect to each and
every covenant, agreement and obligation of Mortgagor under this Mortgage and
any and all other Loan Documents.
26. Collateral Agent's Fees and Expenses; Indemnification. (a) Without in
anyway limiting any other reimbursement obligations contained under the other
Loan Documents, the Mortgagor agrees to pay upon demand to the Collateral Agent
the amount of any and all reasonable expenses, including the reasonable fees,
disbursements and other charges of its counsel and of any experts or agents,
which the Collateral Agent may incur in connection with the exercise,
enforcement or protection of any of the rights of the Collateral Agent
hereunder.
21
(b) Without limitation of its indemnification obligations under the other
Loan Documents, the Mortgagor agrees to indemnify the Collateral Agent and the
other Indemnitees against, and hold each of them harmless from, any and all
losses, claims, damages, liabilities and related expenses, including reasonable
fees, disbursements and other charges of counsel, incurred by or asserted
against any of them arising out of, in any way connected with, or as a result
of, the execution, delivery or performance of this Mortgage or any claim,
litigation, investigation or proceeding relating hereto or to the Mortgaged
Property, whether or not any Indemnitee is a party thereto; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses are determined by a
court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence, bad faith, or willful misconduct of such
Indemnitee.
(c) Any such amounts payable as provided hereunder shall be additional
Secured Obligations secured hereby and by the other Security Documents. The
provisions of this Paragraph 26 shall remain operative and in full force and
effect regardless of the termination of this Mortgage or any other Loan
Document, the consummation of the transactions contemplated hereby, the
repayment of any of the Secured Obligations, the invalidity or unenforceability
of any term or provision of this Mortgage or any other Loan Document, or any
investigation made by or on behalf of the Collateral Agent or any Secured Party.
All amounts due under this Paragraph 26 shall be payable on written demand
therefor.
27. Submission to Jurisdiction. MORTGAGOR AGREES THAT ANY SUIT FOR THE
ENFORCEMENT OF THIS MORTGAGE MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW
YORK SITTING IN THE BOROUGH OF MANHATTAN OR ANY FEDERAL COURT SITTING THEREIN AS
THE COLLATERAL AGENT MAY ELECT IN ITS SOLE DISCRETION AND CONSENTS TO THE
NON-EXCLUSIVE JURISDICTION OF SUCH COURTS. MORTGAGOR AND COLLATERAL AGENT (BY
ITS ACCEPTANCE OF THIS MORTGAGE) EACH HEREBY WAIVES ANY OBJECTION WHICH IT MAY
NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT
SUCH SUIT IS BROUGHT IN AN INCONVENIENT FORUM AND AGREES THAT A FINAL JUDGMENT
IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN
OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY
LAW. NOTHING IN THIS MORTGAGE OR ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT
THAT COLLATERAL AGENT MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING
RELATING TO THIS MORTGAGE AGAINST COLLATERAL AGENT OR ITS PROPERTIES IN THE
COURTS OF ANY JURISDICTION.
MORTGAGOR AGREES THAT ANY ACTION COMMENCED BY MORTGAGOR ASSERTING ANY CLAIM
OR COUNTERCLAIM ARISING
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UNDER OR IN CONNECTION WITH THIS MORTGAGE OR ANY OTHER LOAN DOCUMENT SHALL BE
BROUGHT SOLELY IN A COURT OF THE STATE OF NEW YORK SITTING IN THE BOROUGH OF
MANHATTAN OR ANY FEDERAL COURT SITTING THEREIN AS THE COLLATERAL AGENT MAY ELECT
IN ITS SOLE DISCRETION AND CONSENTS TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS
WITH RESPECT TO ANY SUCH ACTION.
MORTGAGOR AND COLLATERAL AGENT (BY ITS ACCEPTANCE OF THIS MORTGAGE)
IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN
SECTION 9.1 OF THE CREDIT AGREEMENT. NOTHING IN THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT WILL AFFECT THE RIGHT OF MORTGAGOR AND COLLATERAL AGENT TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.
28. WAIVER OF JURY TRIAL. MORTGAGOR AND COLLATERAL AGENT (BY ITS ACCEPTANCE
OF THIS MORTGAGE) EACH HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT TO A JURY IN ANY TRIAL OF ANY CASE OR CONTROVERSY
(WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY) IN WHICH ANY SUCH PERSON
IS OR BECOMES A PARTY (WHETHER SUCH CASE OR CONTROVERSY IS INITIATED BY OR
AGAINST ANY SUCH PERSON OR IN WHICH ANY SUCH PERSON IS JOINED AS A PARTY
LITIGANT), WHICH CASE OR CONTROVERSY ARISES OUT OF OR IS IN RESPECT OF, ANY
RELATIONSHIP AMONGST OR BETWEEN ANY LOAN PARTY OR ANY OTHER PERSON AND ANY
SECURED PARTY OR PARTICIPANT OR THE ACTIONS OF ANY SECURED PARTY IN THE
NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF. EACH OF
MORTGAGOR AND COLLATERAL AGENT (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTY HAVE BEEN INDUCED TO
ENTER INTO THIS MORTGAGE BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS PARAGRAPH 28.
29. Future Advances. This Mortgage secures future advances made pursuant to
this Mortgage or the Credit Agreement.
30. Advance Money Mortgage. This Mortgage secures future advances made
pursuant to the Credit Agreement. Without limiting the foregoing, this Mortgage
secures all advances made by the Collateral Agent of any kind or nature
described in 42 Pa. C.S. Section 8144. The maximum principal amount that may be
secured by this Mortgage is $400,000,000 plus certain other unpaid balances of
advances,
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interest and costs and expenses described above; provided that in no event shall
Collateral Agent be obligated to advance to or for the benefit of Mortgagor in
excess of the stated principal amount of the loans evidencing the Secured
Obligations. If Mortgagor sends a written notice to Collateral Agent which
purports to limit the indebtedness secured by this Mortgage and to release the
obligation of Collateral Agent to make any additional advances to Mortgagor,
such notice shall be ineffective as to any future advances made: (i) to enable
completion of improvements on the Property for which the loan secured hereby was
originally made; (ii) to pay taxes, assessments, maintenance charges and
insurance premiums; (iii) for costs incurred for protection of the Property or
the lien of this Mortgage; (iv) expenses incurred by the Collateral Agent by
reason of a default of Mortgagor hereunder or under the Loan Documents,
(including, but not limited to, all fees and expenses of Collateral Agent's
legal counsel); and (v) any other costs incurred by Collateral Agent to protect
and preserve the Property. It is the intention of the parties hereto that any
such advance made by Collateral Agent after any such notice by Mortgagor shall
be secured by the lien of this Mortgage on the Property, all to the fullest
extent provided in 42 Pa. C.S.A. 8144.
31. Covenants Running with the Land. The covenants and agreements of
Mortgagor herein shall be construed as covenants and agreements running with the
land and shall be binding on Mortgagor and its successors and assigns; subject
and provided always that in the event Mortgagor performs all of its obligations
under the Credit Agreement, the other Loan Documents, and hereunder, and upon
the satisfaction of this Mortgage of record, all of such covenants and
agreements shall terminate absolutely.
32. Business Purpose. Mortgagor warrants that this Mortgage is delivered in
connection with a business or
commercial loan transaction.
33. True Copy. Mortgagor acknowledges receipt of a "True Copy" of this
Mortgage, provided to Mortgagor without charge.
34. Intent of the Parties. It is the intention of the Lender and the
Mortgagor that this Mortgage shall not merge into any judgment in mortgage
foreclosure or other judgment entered pursuant to this Mortgage or the Credit
Agreement and that all rights, remedies, covenants, obligations, and agreements
in this Mortgage shall survive the entry of such judgment or judgments.
35. Warranties and Representations. It is intended that this Mortgage
supplement the other Loan Documents, and the warranties, representations,
covenants and agreements made by the Mortgagor herein are supplemental to those
set forth in the other Loan Documents. In the event of a conflict between this
Mortgage and the other Loan Documents, the terms of this Mortgage shall control
with respect to the Land, the Improvements, the Property Leases and the
Revenues.
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36. Fixture Filing. Certain of the Mortgaged Property is or will become
"fixtures" (as that term is defined in the UCC) on the Land, and this Mortgage
upon being filed for record in the real estate records of the county wherein
such fixtures are situated shall operate also as a financing statement filed as
a fixture filing in accordance with the applicable provisions of said UCC upon
such of the Mortgaged Property that is or may become fixtures.
37. MORTGAGOR'S ACKNOWLEDGEMENT OF WAIVERS OF RIGHTS. THIS MORTGAGE
CONTAINS MORTGAGOR'S WAIVER OF TRIAL BY JURY, PROVIDES FOR THE REMEDY OF
CONFESSION OF JUDGMENT BY COLLATERAL AGENT AND WAIVES CERTAIN OTHER RIGHTS AND
REMEDIES BY MORTGAGOR. IN CONNECTION THEREWITH, MORTGAGOR INTENTIONALLY,
VOLUNTARILY, KNOWINGLY, AND INTELLIGENTLY WAIVES MORTGAGOR'S RIGHT TO A TRIAL BY
JURY, ITS RIGHT, IF ANY, TO NOTICE AND TO BE HEARD BEFORE THE ENTRY OF JUDGMENT
BY CONFESSION, AND WAIVES OTHER RIGHTS AND REMEDIES AS SET FORTH IN THIS
MORTGAGE. MORTGAGOR ACKNOWLEDGES THAT IT IS REPRESENTED BY INDEPENDENT LEGAL
COUNSEL AND THAT COUNSEL HAS REVIEWED AND EXPLAINED THE MEANING OF THESE WAIVERS
AND REMEDIES TO MORTGAGOR
[Remainder of page left intentionally blank]
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<page>
IN WITNESS WHEREOF, Mortgagor has executed this Mortgage under seal, as of
the day and year first above written.
Witness: ELECTRONICS BOUTIQUE OF AMERICA INC.
/s/ Dawn Hofer By: /s/ David W. Carlson
- ------------------------------------ ---------------------------
Print Name: Dawn Hofer Name: David W. Carlson
/s/ Matt Hodges
- ------------------------------------
Print Name: Matt Hodges Title: Executive Vice President
and Chief Financial Officer
26
<page>
STATE OF TEXAS
Tarrant County
On this 5th day of October, 2005, before me personally appeared the
above-named David W. Carlson, the Executive Vice President and Chief Financial
Officer of Electronics Boutique of America Inc., a Pennsylvania corporation, and
acknowledged the foregoing to be his/her free act and deed and the free act and
deed of said Electronics Boutique of America Inc..
/s/ Glenda Williams
----------------------------------
Notary Public
My commission expires:
(AFFIX SEAL)
DRAFTED BY AND WHEN RECORDED
RETURN TO:
Riemer & Braunstein LLP
Three Center Plaza
Boston, Massachusetts 02108
Attention: David S. Berman, Esquire
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<page>
EXHIBIT A
DESCRIPTION and RECITAL
ALL THAT Certain lot or piece of ground with the buildings and improvements
thereon erected, SITUATE in the Township of West Goshen, County of Chester and
Commonwealth of Pennsylvania bounded and described in accordance with an
As-Built Survey and Land Title Survey made for the Denney-Reyburn Company, dated
September 27, 1989 by Yerkes Associates, Inc., West Chester, Pa. as follows:
BEGINNING at a spike set in the title line of Matlack Street (50 feet wide) at
its intersection with the Easterly right of way line of the West Chester By-Pass
Route 202; thence leaving Matlack Street and extending along the Easterly right
of way line of the West Chester By-Pass Route 202, the (6) following courses and
distances to wit: (1) North 32 degrees, 43 minutes, 00 seconds East, 44.00 feet
to an iron pint; thence (2) North 57 degrees, 17 minutes, 00 seconds West, 5.16
feet to a point of curve; thence (3) in a Northwesterly direction along a curved
line curving to the right, having a radius of 116.00 feet to an arc distance of
151.27 feet and the chord of the arc being North 19 degrees, 55 minutes, 33
seconds West, 140.77 feet to an iron pin set at a point of compound curve;
thence (4) in a Northeasterly direction along a curved line curving to the right
having a radius of 366.00 feet to an arc distance of 91.74 feet and the chord of
the arc being North 24 degrees, 36 minutes, 44 seconds East 91.60 feet to an
iron point; thence (5) South 58 degrees, 12 minutes, 25 seconds East, 15.00 feet
to an iron pin; thence (6) North 31 degrees, 57 minutes, 19 seconds East, 432.68
feet to an iron pin set at a common corner with land belonging now or formerly
to Francis H. Henderson; thence leaving the road and extending along land
belonging now or formerly to Francis H. Henderson, North 52 degrees, 38 minutes,
00 seconds East, 156.47 feet to an iron pin set at a common corner with land
belonging now or formerly to Rowen and Drury; thence extending along land
belonging now or formerly to Starr Associates, South 39 degrees, 27 minutes, 00
seconds East, 693.92 feet to an iron pin set at a common corner with land
belonging now or formerly to Richard M. Fedor; thence extending along land
belonging now or formerly to Richard M. Fedor, South 22 degrees, 43 minutes, 00
seconds West, 800.00 feet to a spike set in the title line in the bed of Matlack
Street; thence extending along the title line in the bed of Matlack Street,
North 57 degrees, 17 minutes, 00 seconds West, 626.52 feet to the first
mentioned point and piece of beginning.
CONTAINING an area of 13.428 Acres of land, be the same more or less.
CHESTER COUNTY TAX PARCEL #52-7-31.1
BEING the same premises which Rouse & Associates - 931 South Matlack Street
Limited Partnership, a Pennsylvania Limited Partnership by Deed dated 10-30-1997
and recorded in Chester County, in Record Book 4254 page 502 conveyed unto The
Electronics Boutique, Inc., A Corporation
TOGETHER with all and singular the buildings, improvements, ways, streets,
alleys, driveways, passages, waters, water-courses, rights, liberties,
privileges, hereditaments and appurtenances, whatsoever unto the hereby granted
premises belonging, or in any wise appertaining, and the reversions and
remainders, rents, issues, and profits thereof; and all the estate, right,
title, interest, property, claim and demand whatsoever of the said Grantor as
well at law as in equity, of, in, and to the same.
TO HAVE AND TO HOLD the said lot or piece of round described with the said
hereditaments and premises hereby granted, or mentioned, and intended so to be,
with the appurtenances, unto the said Grantee(s), its successors end .assigns,
to and for the only proper use and behoof of the said Grantee(s), its successors
and assigns forever.
AND the said Grantor for itself and its successors and assigns, does by these
presents, covenant, promise, and agree, to and with the said Grantee(s), its
successor and assigns that they the said Grantor its successors and assigns, all
and singular the Hereditaments and premises herein above described and granted,
or mentioned and intended so to be with the Appurtenances unto the said
Grantee(s), its successors and assigns, against the said Grantor its successors
and assigns, and against all and every Person or Persons whomsoever lawfully
claiming or to claim the same or any part thereof, by from. or under him, her,
them, shall and will subject as aforesaid SPECIALLY WARRANT AND FOREVER DEFEND.
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