Exhibit 10.7
PREPARED BY AND WHEN
RECORDED MAIL TO:
Elizabeth W. Goode, Esq.
Helms Mulliss & Wicker, PLLC
201 North Tryon Street
Charlotte, North Carolina 28202
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A MORTGAGE, OPEN-END MORTGAGE, LEASEHOLD MORTGAGE,
OPEN-END LEASEHOLD MORTGAGE, SECURITY AGREEMENT,
FIXTURE FILING, ASSIGNMENT OF LEASES AND RENTS
AND
FINANCING STATEMENT
Dated and effective as of May 15, 2002
between
BLOCK COMMUNICATIONS, INC., an Ohio corporation,
formerly known as BLADE COMMUNICATIONS, INC.
Grantor
and
BANK OF AMERICA, N.A.,
as Agent
Beneficiary
THE INITIAL TERM OF THE INDEBTEDNESS SECURED BY THIS INSTRUMENT
WILL EXPIRE ON NOVEMBER 15, 2009.
IF THE PROPERTY TO BE ENCUMBERED BY THIS INSTRUMENT IS LOCATED IN PENNSYLVANIA,
THE FOLLOWING SHALL BE APPLICABLE. THIS INSTRUMENT IS INTENDED TO BE AN OPEN END
MORTGAGE AS DEFINED IN 42 PA.C.S.A. Section 8143, AND SHALL BE ENTITLED TO THE
BENEFITS OF SUCH STATUTE. THE MAXIMUM AMOUNT OF INDEBTEDNESS SECURED BY THIS
INSTRUMENT AT ANY TIME IS $300,000,000.00, PLUS AMOUNTS PROVIDED IN
SECTION 2.3(b) OF THIS INSTRUMENT.
THIS INSTRUMENT SECURES FUTURE ADVANCES
THIS INSTRUMENT SECURES DEBT WHICH INCLUDES FUTURE ADVANCES BY BENEFICIARY
AND/OR CERTAIN SECURED CREDITORS TO GRANTOR INCLUDING, AMONG OTHER THINGS,
TERM LOANS, SWING LINE LOANS, REVOLVING CREDIT LOANS AND REIMBURSEMENT OF
ADVANCES MADE UNDER LETTERS OF CREDIT.
THIS INSTRUMENT COVERS GOODS WHICH ARE OR ARE TO BECOME FIXTURES RELATED TO
THE REAL ESTATE DESCRIBED HEREIN AND IS TO BE RECORDED IN THE DEED RECORDS AND
IS ALSO TO BE INDEXED IN THE INDEX OF FINANCING STATEMENTS OR OF FIXTURE
FILINGS. REFER TO PAGE ONE OF THIS INSTRUMENT FOR ADDITIONAL INFORMATION
CONCERNING THE DEBTOR AND SECURED PARTY.
THE INDEBTEDNESS SECURED HEREBY INCLUDES A REVOLVING CREDIT FACILITY.
IF THE STATE IS OHIO, THIS INSTRUMENT SECURES DEBT WHICH INCLUDES FUTURE
ADVANCES THAT ANY SECURED CREDITOR MAY BE OBLIGATED TO MAKE HEREUNDER OR
UNDER THE CREDIT AGREEMENT TO THE EXTENT THAT THE MAXIMUM AMOUNT OF
UNPAID LOAN INDEBTEDNESS, EXCLUSIVE OF INTEREST, DOES NOT
EXCEED $300,000,000.00.
Table of Contents
Page
ARTICLE I
DEFINITIONS
1.1 Definitions.......................................................... 3
1.2 Defined Terms........................................................ 10
ARTICLE II
GRANT
2.1 Grant................................................................ 11
2.2 Defeasance and Reconveyance.......................................... 11
2.3 Provisions Concerning Particular States.............................. 12
2.4 Credit Agreement..................................................... 12
ARTICLE III
WARRANTIES AND REPRESENTATIONS
3.1 Title to Mortgaged Property and Lien of this Instrument.............. 13
3.2 [Intentionally Omitted].............................................. 13
3.3 Encumbered Leases.................................................... 13
3.4 Powers of Termination and Rights of Reverter......................... 13
3.5 Wetlands............................................................. 14
3.6 Environmental Matters................................................ 14
ARTICLE IV
AFFIRMATIVE COVENANTS
4.1 Payment and Performance.............................................. 15
4.2 Compliance with Legal Requirements................................... 15
4.3 Lien Status.......................................................... 15
4.4 [Intentionally Deleted].............................................. 16
4.5 [Intentionally Deleted].............................................. 16
4.6 Insurance............................................................ 16
4.7 Restoration Following Casualty....................................... 16
4.8 Application of Proceeds.............................................. 17
4.9 [Intentionally Deleted].............................................. 17
4.10 [Intentionally Deleted].............................................. 17
4.11 Appraisals........................................................... 17
4.12 Taxes................................................................ 17
4.13 Collection Costs..................................................... 17
4.14 [Intentionally Deleted].............................................. 18
4.15 [Intentionally Deleted].............................................. 18
4.16 Creation and Recordation of Additions and Betterments................ 18
4.17 Consents............................................................. 18
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Table of Contents
(continued)
Page
4.18 Covenants Relating to Encumbered Leases.............................. 18
4.19 Lessor's Bankruptcy.................................................. 20
4.20 [Intentionally Deleted].............................................. 22
4.21 Change of Name or Address............................................ 22
4.22 Environmental Assessment Reports..................................... 22
4.23 Response to Environmental Complaint.................................. 23
4.24 Indemnification...................................................... 23
4.25 [Intentionally Deleted].............................................. 23
4.26 Transfer of License.................................................. 23
ARTICLE V
NEGATIVE COVENANTS
5.1 Rights of Reverter and Powers of Termination......................... 24
ARTICLE VI
DEFAULT AND FORECLOSURE
6.1 Remedies............................................................. 24
6.2 No Conditions Precedent to Exercise of Remedies...................... 29
6.3 Release of and Resort to Collateral.................................. 30
6.4 Waivers.............................................................. 30
6.5 Discontinuance of Proceedings........................................ 30
6.6 Application of Proceeds.............................................. 30
6.7 Cooperation.......................................................... 31
ARTICLE VII
CONDEMNATION
7.1 General.............................................................. 31
7.2 Rebuilding, Restoration and Repair................................... 31
ARTICLE VIII
SECURITY AGREEMENT AND ASSIGNMENT OF LEASES AND RENTS
8.1 Assignment........................................................... 32
8.2 Collection of Rents.................................................. 33
8.3 Beneficiary's Powers of Attorney..................................... 34
8.4 Grantor Remains Liable............................................... 35
8.5 Grantor's Representations and Warranties............................. 35
8.6 Grantor's Covenants.................................................. 36
8.7 Effect of Release of Mortgaged Property.............................. 37
8.8 Hold Harmless........................................................ 37
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Table of Contents
(continued)
Page
ARTICLE IX
INDIVIDUAL BENEFICIARY
9.1 Individual Beneficiary............................................... 38
ARTICLE X
MISCELLANEOUS
10.1 Performance at Grantor's Expense..................................... 39
10.2 Survival of Obligations.............................................. 39
10.3 Further Assurances................................................... 39
10.4 Recording and Filing................................................. 39
10.5 Notices.............................................................. 40
10.6 No Waiver; Remedies.................................................. 41
10.7 Beneficiary's and Secured Creditors' Right to Perform the Obligations 41
10.8 Covenants Running with the Land...................................... 42
10.9 Successors and Assigns............................................... 42
10.10 Severability......................................................... 42
10.11 Entire Agreement and Modification.................................... 43
10.12 APPLICABLE LAW....................................................... 43
10.13 No Partnership; Control in Grantor................................... 44
10.14 Headings............................................................. 45
10.15 Hold Harmless........................................................ 45
10.16 Pronouns and Plurals................................................. 45
10.17 WAIVER OF TRIAL BY JURY.............................................. 46
10.18 Assignment........................................................... 46
10.19 No Merger............................................................ 46
10.20 Enforceability of Lien............................................... 46
10.21 Knowledge............................................................ 46
10.22 Best Efforts......................................................... 46
10.23 Usury Savings Clause................................................. 46
10.24 Payment of Prior Encumbrances........................................ 46
10.25 Industrial Plant Mortgage............................................ 47
10.26 Release.............................................................. 47
EXHIBIT A Land or Encumbered Leases.................................... 1
EXHIBIT B Fee Owner of Land Underlying Encumbered Lease................ 2
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THIS INSTRUMENT IS A MORTGAGE, OPEN-END MORTGAGE, LEASEHOLD MORTGAGE,
OPEN-END LEASEHOLD MORTGAGE, SECURITY AGREEMENT, FIXTURE FILING, ASSIGNMENT OF
LEASES AND RENTS AND FINANCING STATEMENT OF BOTH REAL AND PERSONAL PROPERTY,
INCLUDING GOODS THAT ARE OR ARE TO BECOME FIXTURES ON THE REAL PROPERTY
DESCRIBED HEREIN, AND IS TO BE FILED FOR RECORD IN THE RECORDS WHERE MORTGAGES
OF REAL ESTATE ARE RECORDED. ADDITIONALLY, THIS INSTRUMENT SHOULD BE
APPROPRIATELY INDEXED, NOT ONLY AS A MORTGAGE BUT ALSO AS A FINANCING STATEMENT
OR FIXTURE FILING COVERING GOODS THAT ARE OR ARE TO BECOME FIXTURES ON THE REAL
PROPERTY DESCRIBED HEREIN. THE NAMES OF THE GRANTOR (DEBTOR/MORTGAGOR) AND
BENEFICIARY (SECURED PARTY/MORTGAGEE), THE MAILING ADDRESSES OF THE GRANTOR
(DEBTOR/MORTGAGOR), THE ADDRESS OF BENEFICIARY (SECURED PARTY/MORTGAGEE) FROM
WHICH INFORMATION CONCERNING THE SECURITY INTEREST MAY BE OBTAINED, AND A
STATEMENT INDICATING THE TYPES, OR DESCRIBING THE ITEMS OF COLLATERAL, ARE SET
FORTH BELOW IN SECTIONS 1.1 AND 8.1 OF THIS INSTRUMENT, RESPECTIVELY. IF THE
MORTGAGED PROPERTY IS A LEASEHOLD, THE NAME OF THE FEE OWNER IS SET FORTH IN
EXHIBIT "B" HERETO. THIS INSTRUMENT CONTAINS AFTER-ACQUIRED PROPERTY PROVISIONS
AND SECURES OBLIGATIONS CONTAINING PROVISIONS FOR CHANGES IN INTEREST RATES,
EXTENSIONS OF TIME FOR PAYMENT AND OTHER MODIFICATIONS IN THE TERMS OF THE
OBLIGATIONS. TO THE EXTENT THE MORTGAGED PROPERTY IS LOCATED IN THE STATE OF
OHIO OR PENNSYLVANIA, THIS INSTRUMENT SHALL BE DEEMED TO BE AND SHALL BE
ENFORCEABLE AS AN OPEN-END MORTGAGE, MORTGAGE, LEASEHOLD MORTGAGE AND/OR
LEASEHOLD OPEN-END MORTGAGE AND AS A SECURITY AGREEMENT, ASSIGNMENT OF LEASES
AND RENTS AND FINANCING STATEMENT. THIS INSTRUMENT SECURES FUTURE ADVANCES MADE
PURSUANT TO THE PROVISIONS HEREOF AND THE CREDIT AGREEMENT REFERRED TO BELOW.
THE ADDRESS AT WHICH COMMUNICATIONS TO THE SECURED CREDITORS MAY BE MAILED OR
DELIVERED IS: CARE OF BANK OF AMERICA, N.A., AS AGENT, 901 MAIN STREET, 14TH
FLOOR, TX1-492-14-11 DALLAS, TEXAS 75202, ATTENTION: AGENCY MANAGEMENT.
MORTGAGE, OPEN-END MORTGAGE, LEASEHOLD MORTGAGE,
OPEN-END LEASEHOLD MORTGAGE, SECURITY AGREEMENT,
FIXTURE FILING, ASSIGNMENT OF LEASES AND RENTS AND
FINANCING STATEMENT
A POWER OF SALE HAS BEEN GRANTED IN THIS MORTGAGE. A POWER OF SALE MAY ALLOW THE
BENEFICIARY TO TAKE THE MORTGAGED PROPERTY AND SELL IT WITHOUT GOING TO COURT IN
A FORECLOSURE ACTION UPON DEFAULT BY THE GRANTOR UNDER THIS MORTGAGE.
THIS MORTGAGE, OPEN-END MORTGAGE, LEASEHOLD MORTGAGE, OPEN-END LEASEHOLD
MORTGAGE, SECURITY AGREEMENT, FIXTURE FILING, ASSIGNMENT OF LEASES AND RENTS,
AND FINANCING STATEMENT (hereinafter referred to as this "Deed of Trust" or this
"Mortgage"), is entered into as of the 15th day of May, 2002, by and among BLOCK
COMMUNICATIONS, INC., an Ohio corporation, formerly known as BLADE
COMMUNICATIONS, INC., the mortgagor, grantor and trustor hereunder (herein
called "Grantor"), whose address for all purposes hereunder is 541 N. Superior
Street, Toledo, Ohio 43660 Attention: Gary Blair, Chief Financial Officer; and
BANK OF AMERICA, N.A., a national banking association, acting in its capacity as
Agent for the Secured Creditors (as defined herein), under the Credit Agreement
(as defined herein), the mortgagee hereunder (herein called "Beneficiary", which
term shall include each of its successors and assigns), whose address for all
purposes hereunder is 901 Main Street, TX1-492-14-11, 14th Floor, Dallas, Texas
75202, Attention: Agency Management. Beneficiary shall hold the interests and
exercise the rights granted hereunder in trust as Agent for the benefit of and
as security for the Secured Creditors, as more fully provided in the Credit
Agreement. This Mortgage secures the Obligations (as defined below in Section
1.1) and any modifications, extensions and renewals of the Obligations, it being
the intention of the parties hereto that this Mortgage shall be deemed an open
and continuing lien instrument to secure all such Obligations now existing or
hereafter arising regardless of the extinguishment and payment of any one or
more obligations owed to the Secured Creditors. This Mortgage secures future
advances made by the Secured Creditors to the Grantor under the Credit
Agreement, the other Loan Documents and hereunder, and each future advance,
whether or not evidenced by a note, and each note or other instrument evidencing
the same, shall be secured hereby. All provisions of this Mortgage shall apply
to each future advance as well as to all other Obligations secured hereby,
whether or not evidenced by a note, and all such advances and other Obligations,
and any modifications, extensions and renewals of the same shall have the same
lien priority as if made on the date this Mortgage is recorded.
This Mortgage secures the Obligations (as defined below in Section 1.1),
and any modifications, extensions and renewals of the same, which shall be
construed in all cases to consist of, among other obligations, the covenants of
Grantor set forth in, and the amounts advanced to or for the account, use or
benefit of Grantor from time to time pursuant to the Loan Documents (as defined
below), the aggregate amount of the Secured Indebtedness (as defined below)
actually outstanding at any particular time being subject to fluctuations up or
down due to further advances of loan proceeds and/or future repayments of such
loan proceeds from time to time over the term of such Secured Indebtedness
and/or changes in the rate of interest charged in respect of Secured
Indebtedness bearing interest at a floating rate (all of which advances and
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repayments are hereby declared to be contemplated by the Grantor and the
Beneficiary at the time this Mortgage is executed).
WITNESSETH:
ARTICLE I
DEFINITIONS
1.1 DEFINITIONS: As used herein, the following terms shall have the
following meanings:
AGENT: Initially Bank of America, N.A. in its capacity as Administrative
Agent for the Secured Creditors and any successor Administrative Agent pursuant
to the Credit Agreement.
ASSIGNMENT: The assignment and delivery to Beneficiary as security for the
payment and performance of the Obligations of all of the rights, titles,
interests and estates of Grantor in and to all of the following: (a) the
Encumbered Leases and the Election, (b) the Leases, (c) the Rents, (d) the
Fixtures and (e) the Personalty.
BAS: Banc of America Securities LLC and its successors.
BANKRUPTCY CODE: The Bankruptcy Code, 11 U.S.C. Section 101, et seq., as
the same may be amended from time to time.
BENEFICIARY: Bank of America, N.A., as Agent for the Secured Creditors,
and, if Bank of America, N.A. is not permitted to act as Beneficiary in any
State, then in that State the Individual Beneficiary to the extent and solely
for the purpose described in Section 9.1, and each of their successors and
assigns.
BUILDINGS: Any and all buildings, parking structures, utility sheds,
workrooms, air conditioning towers, open parking areas, and other structures or
improvements, and any and all additions, alterations, betterments or
appurtenances thereto, now or at any time hereafter situated, placed or
constructed upon the Land or any part thereof.
COMMITMENTS: The commitments by the Lenders to make the term loans, swing
line loans and the revolving credit loans as set forth in the Credit Agreement
(which includes commitments to issue Letters of Credit as more particularly set
forth therein).
CREDIT AGREEMENT: The Credit Agreement dated as of May 15, 2002, among the
Grantor, the Lenders, and the Agent, which agreement is incorporated by
reference in this Mortgage and which provides for the making of term loans,
swing line loans and revolving credit loans and the issuance of, and
participation in, Letters of Credit as contemplated therein (as the same may be
amended, modified, extended, renewed, restated and/or supplemented from time to
time), provided, however, that references herein to sections or provisions of,
schedules or exhibits to, or capitalized terms or phrases contained in, the
Credit Agreement shall have the respective meanings defined or provided in the
Credit Agreement as it exists on the date hereof, and as it may be modified from
time to time.
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DEBTOR RELIEF LAWS: As defined in the Credit Agreement.
DEFAULT: As defined in the Credit Agreement.
DEFAULT RATE: As defined in the Credit Agreement.
ELECTION: The election available to a lessee under 11 U.S.C. Section
365(h) of the Bankruptcy Code, as the same may be amended from time to time,
together with any comparable right under any other state or federal law relating
to bankruptcy, reorganization or other relief for debtors, whether now or
hereafter in effect.
ENCUMBERED LEASES: The lease or leases described as "Encumbered Leases" in
Exhibit "A" attached hereto, if any, together with all rights, options and other
benefits inuring to the Grantor as lessee thereunder and together with all
claims and rights of damages made from a rejection of the same.
ENVIRONMENTAL LAWS: All Laws relating to environmental matters applicable
to the Mortgaged Property.
EQUIPMENT: All of the Grantor's right, title and interest in and to all
"equipment", as such term is defined in Article 9 of the UCC (as defined below),
now or hereafter existing, now owned or hereafter acquired by the Grantor, which
are now or hereafter located or to be located upon, within or about the Land and
the Buildings, or which are used in or related to the operation of the Mortgaged
Property, including, but not limited to, all machinery, equipment, furnishings,
fixtures, electrical equipment, vehicles and computer and other electronic
data-processing and other office equipment, any movable walls and partitions and
any and all additions, substitutions and replacements of any of the foregoing,
wherever located, together with all attachments, components, parts, equipment
and accessories installed thereon or affixed thereto.
EVENT OF DEFAULT: As defined in the Credit Agreement, or with respect to
an Encumbered Lease, a default by Grantor under the Encumbered Lease which is
not cured in the cure period provided under the Encumbered Lease.
EXHIBITS: The exhibits attached hereto and incorporated herein by this
reference.
EXPENSES: All out-of-pocket costs and expenses (including reasonable fees
and expenses of counsel and court costs) actually incurred and all advances
made, by the Beneficiary or any trustee, co-trustee or agent of the Beneficiary
pursuant to the provisions of, or in furtherance of the Beneficiary's duties or
rights under, the Loan Documents, including, without limitation, expenses of
retaking, holding, preparing for sale or lease, selling and/or leasing the
Mortgaged Property or of assuming the rights of the lessee under any Encumbered
Lease, but excluding any of the same specifically described in the Loan
Documents as being the responsibility of the Beneficiary.
FACILITY TERMINATION DATE: As defined in the Security Agreement.
FINANCING STATEMENT: As defined in Section 8.5 below.
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FIXTURES: Goods (as defined in the UCC) now owned or the ownership of
which is hereafter acquired by Grantor which is so related to the Land and
Buildings forming part of the Mortgaged Property that it is deemed a fixture or
real property under the laws of the State, including, without limitation, all
building or construction materials intended for construction, reconstruction,
alteration or repair of or installation on the Mortgaged Property, construction
equipment, appliances, machinery, plant equipment, fittings, apparatuses,
fixtures and other items now owned or the ownership of which is hereafter
acquired by Grantor and now or hereafter attached to, installed on or in, or
used in connection with (temporarily or permanently), any of the Buildings or
the Land, or which in some fashion are deemed to be fixtures to the Land or
Buildings under the laws of the State, including, but not limited to, the items
described in the definition of Equipment, furnaces, boilers, heaters, engines,
devices for the operation of pumps, pipes, plumbing, cleaning, call and
sprinkler systems, fire and theft protection apparatus and equipment, water
tanks, air and water pollution control, waste disposal, heating, ventilating,
plumbing, lighting, refrigerating, laundry, incinerating, air conditioning and
air cooling equipment and systems, gas and electric machinery, appurtenances and
equipment, pollution control equipment, disposals, dishwashers, refrigerators
and ranges, recreational equipment and facilities of all kinds, carpet, moveable
or immoveable walls or partitions, built-in oxygen and vacuum systems and water,
gas, electrical, storm and sanitary sewer facilities, utility lines and
equipment (whether owned individually or jointly with others, and, if owned
jointly, to the extent of Grantor's interest therein) and all other utilities
whether or not situated in easements, all water tanks, water supply, water power
sites, fuel stations, fuel tanks, fuel supply, and all other structures,
together with all accessions, appurtenances, additions, replacements,
betterments and substitutions for any of the foregoing and the proceeds thereof.
Notwithstanding the foregoing, "Fixtures" shall not include any property which
tenants are entitled to remove pursuant to their Leases.
GRANTOR: The above-defined Grantor and any and all subsequent owners of
the Mortgaged Property.
GOVERNMENTAL AUTHORITY: Any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or capital
ownership or otherwise, by any of the foregoing.
HAZARDOUS MATERIAL: All explosive or radioactive substances or wastes and
all hazardous or toxic substances, wastes or other pollutants, including
petroleum or petroleum distillates, asbestos or asbestos-containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature, the generation, handling, storage,
transportation, disposal, treatment, release, discharge or emission of which is
subject to any Environmental Law.
HIGHEST LAWFUL RATE: As defined in Section 10.23 hereof.
IMPOSITIONS: All real estate and personal property taxes; water, gas,
sewer, electricity and other utility rates and charges; charges for any
easement, license or agreement maintained
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for the benefit of the Mortgaged Property; and all other taxes, standby fees,
levies, claims, charges and assessments, general and special, ordinary and
extraordinary, foreseen and unforeseen of any kind and nature whatsoever which
at any time prior to or after the execution hereof may be assessed, levied or
imposed upon the Mortgaged Property or the Rents or the ownership, use,
occupancy or enjoyment thereof, and any interest, costs or penalties with
respect to any of the foregoing.
INDEBTEDNESS: As defined in the Credit Agreement.
INDIVIDUAL BENEFICIARY: Any individual who shall be hereafter named of
record as Individual Beneficiary, and who shall be co-Beneficiary hereunder to
the extent and subject to the limitations described in Section 9.1 hereof.
INVENTORY: All of the Grantor's right, title and interest, whether now
owned or hereafter acquired, in and to all inventory in all of its forms,
wherever located, now or hereafter existing, including, but not limited to, (i)
goods in which the Grantor has an interest in mass or a joint or other interest
or right of any kind (including, without limitation, goods in which the Grantor
has an interest or right as consignee or consignor) and (ii) goods that are
returned to or repossessed by the Grantor, and all accessions thereto and
products thereof and documents therefor.
LAND: The real estate owned in fee or leased by the Grantor and described
in Exhibit "A" attached hereto, and all rights, titles and interests appurtenant
thereto.
LAWS: Collectively, all international, foreign, Federal, state and local
statutes, treaties, rules, guidelines, regulations, ordinances, codes and
administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.
L/C ISSUER: Bank of America, N.A. in its capacity as issuer of Letters of
Credit in accordance with the Credit Agreement, or any successor issuer of
Letters of Credit thereunder.
LEASES: Any and all leases, subleases, licenses, concessions or other
agreements (written or verbal, now or hereafter in effect) through which Grantor
directly or indirectly grants a possessory interest in and to, or the right to
occupy and use, all or any portion of the Mortgaged Property that constitutes
real property together with any renewals or extensions thereof and all leases,
subleases, licenses, concessions or other agreements in substitution therefor.
LEGAL REQUIREMENTS: (i) Any and all present and future decisions,
statutes, rulings, rules, regulations, permits, certificates or ordinances of
any governmental authority in any way applicable to Grantor or the Mortgaged
Property, including, without limitation, the ownership, use, occupancy,
possession, operation, maintenance, alteration, repair or reconstruction
thereof, (ii) Grantor's presently or subsequently effective Certificate of
Incorporation and Bylaws, (iii) any and all Leases and other contracts (written
or oral) of any nature by which the Grantor or the Mortgaged Property may be
bound, and (iv) any and all restrictions, reservations, conditions, easements or
other covenants or agreements of record affecting the Mortgaged Property.
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LENDERS: As defined in the Credit Agreement, and specifically including
Bank of America, N.A., as the L/C Issuer, or any successor L/C Issuer and each
other lender which may hereafter become a party to the Credit Agreement pursuant
to the terms thereof.
LETTER OF CREDIT: As defined in the Credit Agreement.
LESSOR: The landlord under the Encumbered Lease, if any.
LOAN: As defined in the Credit Agreement.
LOAN DOCUMENTS: As defined in the Credit Agreement.
MATERIAL ADVERSE EFFECT: As defined in the Credit Agreement.
MORTGAGE STATE: Each state defined as a "Mortgage State" in Section 2.3
hereof.
MORTGAGED PROPERTY OR MORTGAGED PROPERTIES: The Land, Buildings, Fixtures,
Personalty, Encumbered Leases, Leases and Rents together with:
(i) all rights, privileges, tenements, licenses, hereditaments,
rights-of-way, easements, utility use, air rights, appendages, division
rights, and appurtenances in any way appertaining thereto, and all right,
title, interest or estate of Grantor in and to any streets, ways, alleys,
roadbeds, inclines, tunnels, culverts, strips or gores of land adjoining
or serving the Land or any part thereof;
(ii) all betterments, additions, alterations, appurtenances,
substitutions, replacements and revisions thereof and thereto and all
reversions and remainders therein;
(iii) all of Grantor's right, title and interest in and to any
awards, remuneration, settlements or compensation hereafter to be made by
any insurer, governmental authority or other person or entity as a result
of the destruction, loss, theft, taking by eminent domain or other
involuntary conversion of whatever nature (whether occurring prior to or
after the date of this Mortgage) of any of the Land, Buildings, Fixtures,
Leases, Encumbered Leases, Rents or Personalty, including those for any
condemnation and vacation of, or change of grade in, any streets affecting
the Land or the Buildings;
(iv) any and all other security and collateral of any nature
whatsoever, now or hereafter given by Grantor to secure the payment and
performance of the Obligations;
(v) all water and water rights (whether riparian, appropriative,
or otherwise and whether or not appurtenant) in or hereafter relating to
or used in connection with the Land, including, without limitation, any
surface water management permits, any consumption use permits or general
permits;
(vi) any right, title, interest or estate hereafter acquired by
Grantor in any of the foregoing and in and to the Land, Buildings,
Fixtures, Personalty (except as otherwise provided herein), Leases,
Encumbered Leases and Rents. To the extent permitted by law, all of the
Fixtures are to be deemed and held to be a part of and affixed to the
Land. In
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the event the estate of the Grantor in and to any of the Land and
Buildings is a leasehold estate, this conveyance shall include and the
lien, security interest and assignment created hereby shall encumber and
extend to all other, further or additional title, estates, interest or
rights which may exist now or at any time be acquired by Grantor in or to
the property demised under the lease creating such leasehold estate and
including Grantor's rights, if any, to purchase the property demised under
such lease and, if fee simple title to any of such property shall ever
become vested in Grantor, such fee simple interest shall be encumbered by
this Mortgage in the same manner as if Grantor had fee simple title to
such property as of the date of execution hereof;
(vii) all of Grantor's right, title and interest in and to any and
all funds deposited by or on behalf of Grantor with any city, county,
public body or agency, irrigation, sewer or water district or company, gas
or electric company, telephone company, and any other body or agency for
the installation, or to secure the installation, of any utility pertaining
to the Land, Buildings, Fixtures and all betterments, additions,
alterations, appurtenances, substitutions, replacements and revisions
thereof and thereto;
(viii) all of Grantor's right, title and interest in and to (i) all
oil, gas and other minerals located in, on or under the Land, (ii) all
oil, gas or mineral leases, royalty agreements and other contracts that
have been or in the future are entered into with respect to the Land or
with respect to any oil, gas or other minerals located in, on or under the
Land ("Mineral Leases"), and (iii) all rents, profits, royalties and
income at any time arising from the Mineral Leases or from the sale of
oil, gas or other minerals located in, on or under the Land; and
(ix) all proceeds and products of the foregoing. As used in this
Mortgage, the term "Mortgaged Property", including each component thereof,
shall be expressly interpreted as meaning all or, where the context
permits or requires, any portion of the above, and all or, where the
context permits or requires, any interest of Grantor therein.
NOTES: As defined in the Credit Agreement, and any notes issued in
replacement, substitution, renewal or refinance of the same.
OBLIGATIONS: All advances to, and debts, liabilities, obligations,
covenants and duties of the Grantor arising under any Loan Document or otherwise
with respect to any Loan or Letter of Credit, including without limitation the
Secured Indebtedness, or arising under any Related Swap Contract, (provided,
however, obligations arising under a Related Swap Contract shall cease to be
obligations secured hereby at such time as the counterparty thereto shall cease
to be a Lender or an Affiliate of a Lender), in each case whether direct or
indirect (including those acquired by assumption), absolute or contingent, due
or to become due, now existing or hereafter arising and including interest and
fees that accrue after the commencement by or against the Grantor or any
Affiliate thereof of any proceeding under any Debtor Relief Laws naming such
Person as the debtor in such proceeding, regardless of whether such interest and
fees are allowed claims in such proceeding.
8
PARCEL: A single parcel of real property identified as a unit in Exhibit
"A" hereto. For purposes of legal description and real property title records, a
Parcel may be comprised of more than one lot.
PERMITTED ENCUMBRANCES: Those Liens and other encumbrances permitted under
Section 7.01 of the Credit Agreement.
PERSONALTY: All of the right, title and interest of Grantor in and to all
tangible and intangible personal property including all furniture, furnishings,
Equipment, machinery, goods, tools, supplies, appliances, general intangibles,
construction contracts, architect's contracts, technical services agreements,
contract rights, franchises, licenses, certificates, operating rights,
approvals, consents, authorizations and permits, and all other personal property
(other than Inventory, accounts receivable, and Fixtures) of any kind or
character (as defined in and subject to the provisions of the UCC) which are now
or hereafter located or to be located upon, within or about the Land and the
Buildings, or which are used in or related to the construction of the Buildings
or the use, occupancy or operation of the Mortgaged Property, together with all
accessories, replacements and substitutions thereto or therefor and the proceeds
thereof; and all insurance proceeds and condemnation proceeds received by
Grantor with respect to the Mortgaged Property to the extent provided herein.
Furthermore, with respect to any of the above-described personal property
represented by a contract, agreement or other instrument or consisting of a
permit, certificate or similar item issued by a governmental authority, then, to
the extent that the granting of the lien or security interest or exercise of
Beneficiary's rights under this Mortgage would constitute a breach or violation
of the terms of such instrument, or any Legal Requirement applicable to such
permit, certificate or similar item that would impose material liability on the
Grantor or that would result in a revocation or forfeiture of such item of
personal property, such personal property shall not constitute "Personalty"
hereunder.
RELATED SWAP CONTRACT: As defined in the Credit Agreement.
RENTS: All of the rents, revenues, income, proceeds, profits, security and
other types of deposits, and other benefits paid or payable and to become due or
payable to Grantor by parties to the Leases for using, leasing, licensing,
possessing, operating from, residing in, selling or otherwise enjoying any
portion or portions of the Mortgaged Property.
REQUIRED LENDERS: As defined in the Credit Agreement.
SECURED CREDITORS: The Agent, BAS and the Lenders that are parties to the
Credit Agreement, and specifically including Bank of America, N.A., in its
capacities as L/C Issuer and a Swing Line Lender, and National City Bank as a
Swing Line Lender, or any successor L/C Issuer or successor Lender making Swing
Line Loans, and each of their successors or assigns, and each Lender or an
Affiliate of a Lender party to any Related Swap Contract.
SECURED INDEBTEDNESS: (a) Subject to Section 2.3(b) below, the principal,
interest, premium (if any) and other sums (including, without limitation the L/C
Obligations) owing or payable by the Grantor pursuant to the Loan Documents,
which includes present advances and future advances to be incurred within the
terms specified in the Credit Agreement, including without limitation,
indebtedness to the Lenders under the Credit Agreement in the original
9
aggregate principal amount of Two Hundred Million Dollars ($200,000,000.00)
evidenced by the Notes and the Credit Agreement; (b) any and all additional
advances made by Beneficiary to protect or preserve the Mortgaged Property (as
defined above) or the security title, security interest and lien hereof on the
Mortgaged Property or to repair or maintain the Mortgaged Property, or to
complete improvements on the Mortgaged Property (whether or not Grantor remains
the owner of the Mortgaged Property at the time of such advances and whether or
not the Beneficiary or the Lenders remain the owner of the Obligations and this
Mortgage) in accordance with the provisions hereof; and (c) any and all expenses
incident to effecting the collection, performance and/or satisfaction of the
Obligations secured hereby and the foreclosure hereof by action in court or by
exercise of the power of sale herein contained; provided, however, that in no
event shall more than Two Hundred Million Dollars ($200,000,000.00) of the total
Secured Indebtedness represent original principal amount due under the Credit
Agreement. The Credit Agreement provides that the interest rate and payment
terms of the indebtedness may be adjusted as provided therein. AT THE OPTION OF
THE GRANTOR AND SUBJECT TO TERMS AND PROVISIONS OF THE CREDIT AGREEMENT, THE
PRINCIPAL AMOUNT OF THE LOANS MAY BE INCREASED FROM $200,000,000 TO $300,000,000
AND IN SUCH EVENT THE PRINCIPAL AMOUNT SET FORTH IN (a) AND (c) ABOVE SHALL BE
$300,000,000.
SECURITY AGREEMENT: As defined in the Credit Agreement.
STATE: The State in which the applicable portion of the Mortgaged Property
is situated. For example, with respect to the portion of the Mortgaged Property
situated in Ohio, the term "State" shall mean the State of Ohio.
SUBSIDIARY: Subsidiary of a Person means a corporation, partnership, joint
venture, limited liability company or other business entity of which a majority
of the shares of securities or other interests having ordinary voting power for
the election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person. Unless otherwise specified, all references herein to a
"Subsidiary" or to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of
the Grantor.
SWAP CONTRACT: As defined in the Credit Agreement.
UCC: The Uniform Commercial Code as adopted in the State.
WORK: As defined in Section 4.7 hereof.
1.2 DEFINED TERMS: The terms "Administrative Agent," "Affiliate,"
"Business Day," "Capital Expenditures," "GAAP," "Lien," and "Person" together
with any other capitalized term used herein but not otherwise defined herein,
shall have the same respective meanings given to them in the Credit Agreement as
it existed on the date hereof, and as it may be modified from time to time.
10
ARTICLE II
GRANT
2.1 GRANT: NOW THEREFORE, for and in consideration of Ten Dollars
($10.00), and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged by Grantor, and to secure the Grantor's full
and faithful performance and satisfaction of the Obligations, Grantor, intending
to be legally bound hereby, has GIVEN, ALIENATED, REMISED, GRANTED, BARGAINED,
MORTGAGED, SOLD, RELEASED, CONVEYED, ASSIGNED, TRANSFERRED, WARRANTED, SET OVER
AND CONFIRMED WITH MORTGAGE COVENANTS and by these presents does GIVE, ALIENATE,
REMISE, GRANT, BARGAIN, MORTGAGE, SELL, RELEASE, CONVEY, ASSIGN, TRANSFER,
WARRANT, SET OVER AND CONFIRM WITH MORTGAGE COVENANTS AND GRANT A SECURITY
INTEREST IN unto Beneficiary with POWER OF SALE and right to entry for the
benefit of Beneficiary, all of the Mortgaged Property, subject only to the
Permitted Encumbrances, TO HAVE AND TO HOLD the Mortgaged Property and (except
as otherwise set forth herein) all parts, rights, members and appurtenances
thereof for the use, benefit and behoof of the Beneficiary and its successors
and assigns, in fee simple forever, or to the extent of Grantor's leasehold
interest therein, forever, hereby releasing and waiving all rights under and by
virtue of the homestead exemption laws of the State, to the extent permitted by
the applicable Legal Requirements of such State; and Grantor hereby absolutely
and irrevocably assigns to Beneficiary the Leases and Rents for the purposes and
upon the terms and conditions herein set forth; and Grantor does hereby bind
itself, its successors and assigns to FOREVER WARRANT AND DEFEND the title to
the Mortgaged Property and every part thereof, subject only to the Permitted
Encumbrances, unto Beneficiary, against every person whomsoever lawfully
claiming or to claim the same or any part thereof.
2.2 DEFEASANCE AND RECONVEYANCE: If the Secured Indebtedness shall have
been paid in full and all the other Obligations shall have been performed and
discharged in full, and all of the Commitments shall have been terminated in
whole, and all of the Letters of Credit shall have been canceled and returned to
the L/C Issuer, and the Facility Termination Date has occurred, and provided
that there exists no pending or threatened unsatisfied obligation pursuant to
the environmental indemnification in Section 10.05 of the Credit Agreement, then
the liens, security interests, estates and rights granted by this Mortgage shall
terminate; whereupon the Beneficiary promptly shall execute such documents in
recordable form as may be necessary to release and/or satisfy the Mortgaged
Property, or that portion thereof then held hereunder, from the lien of and
security interests created or purported to be created by this Mortgage.
To the extent permitted by law, any reconveyance delivered hereunder may
describe the grantee as "the person or persons legally entitled thereto."
Beneficiary shall not have any duty to determine the rights of persons claiming
to be rightful grantees of any reconveyance. Each reconveyance of Mortgaged
Property or portions thereof shall also operate as a reassignment of all future
rents, issues and profits appertaining to the Parcel(s) or portions thereof
covered by such reconveyance to the person or persons legally entitled thereto,
unless its reconveyance expressly provides otherwise.
11
2.3 PROVISIONS CONCERNING PARTICULAR STATES: Notwithstanding anything to
the contrary herein contained:
(a) if the State is Ohio or Pennsylvania (each, a "Mortgage
State"), this instrument shall be deemed to be and shall be enforceable as
a mortgage or open-end mortgage and/or leasehold mortgage or open-end
leasehold mortgage, and as an assignment of leases and rents, security
agreement and financing statement;
(b) If the State is Pennsylvania, the following provisions shall
apply: This Mortgage is an OPEN-END MORTGAGE as defined in 42 Pa. Con.
Stat. Ann. Section 8143 and secures advances made pursuant to the Notes
and other Loan Documents. The maximum total principal indebtedness
outstanding hereunder and secured hereby may not exceed Three Hundred
Million Dollars ($300,000,000.00), plus accrued and unpaid interest and
protective advances made by Beneficiary pursuant to the terms of the Notes
and other Loan Documents. The Mortgage secures, and the Loan Documents
executed in connection herewith evidence, the obligation of Grantor to
repay protective advances made by Beneficiary pursuant to this Mortgage
and the other Loan Documents for, among other things, payment of taxes,
assessments, maintenance charges, insurance premiums, costs incurred for
the protection of the Mortgaged Property or the lien of the Mortgage,
costs incurred by Beneficiary by reason of the occurrence of an Event of
Default, and advances made to complete construction of any improvements at
the Mortgaged Property. Beneficiary's address for receiving notices under
42 Pa. Con. Stat. Ann. Section 8143 shall be 901 Main Street, 14th Floor,
TX1-492-14-11, Dallas, Texas 75202, Attention: Agency Management. Grantor
waives all of Grantor's rights under 42 Pa. Con. Stat. Ann. Section
8143(c).
2.4 CREDIT AGREEMENT: The Credit Agreement includes term loans, swing
line loans, revolving credit loans, and in connection therewith there may be
repayments and disbursements of principal from time to time. It is expressly
agreed that the outstanding principal balance of the Indebtedness evidenced by
the Notes and governed by the Credit Agreement may, from time to time, be
reduced to a zero balance without such repayment operating to extinguish and
release the lien, security titles and security interests created by this
Mortgage. This Mortgage shall remain in full force and effect as to any
subsequent future advances made after the zero balance without loss of priority
until the Obligations are paid in full and fully performed and satisfied, all of
the Commitments shall have been terminated in whole, all of the Letters of
Credit shall have been canceled and returned to the L/C Issuer, the Facility
Termination Date has occurred, and the Credit Agreement and all other agreements
between the Grantor and the Secured Creditors for further advances have been
terminated. Grantor waives the operation of any applicable statute, law or
regulation having a contrary effect.
ARTICLE III
WARRANTIES AND REPRESENTATIONS
For the consideration aforesaid and to protect the security of this
Mortgage, Grantor hereby unconditionally warrants and represents to Beneficiary
as follows:
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3.1 TITLE TO MORTGAGED PROPERTY AND LIEN OF THIS INSTRUMENT: Grantor has
good and record and marketable title in fee (or, if and to the extent that the
Mortgaged Property includes any Encumbered Lease, good title in the leasehold)
to the Land, Buildings and Fixtures and good title to the Personalty and Leases,
in all cases free and clear of any Liens and claims of Liens except the
Permitted Encumbrances. This Mortgage constitutes a valid lien and mortgage on
the Grantor's fee and leasehold interests in the Land, the Buildings and the
Fixtures, including without limitation all of Grantor's right, title and
interest in and to any Encumbered Lease, and a valid security agreement which
creates a valid security interest in and to, and a valid assignment of, the
Fixtures, Personalty, Leases and Rents, all in accordance with the terms hereof,
in each case subject only to the Permitted Encumbrances.
3.2 [INTENTIONALLY OMITTED]
3.3 ENCUMBERED LEASES: The Grantor hereby unconditionally warrants and
represents to the Beneficiary as follows with respect to each Encumbered Lease:
(a) The Encumbered Lease constitutes, to the best of Grantor's
knowledge, the legal, valid and binding obligation of the lessor thereof,
and is enforceable by the lessee in accordance with its terms, except as
the enforceability thereof may be limited by bankruptcy, insolvency,
moratorium, reorganization or similar laws affecting creditors' rights and
remedies generally or by application of general equity principles and the
terms thereof are as set forth in the lease documents described on Exhibit
"A", copies of which have been delivered to the Beneficiary;
(b) All rent, additional rent and other charges reserved therein
have been paid to the extent they are payable to the date hereof;
(c) The Grantor enjoys the quiet and peaceful possession of the
property demised thereby in accordance with and subject to the terms of
such Encumbered Lease;
(d) The Encumbered Lease is not subject to any other assignments
by the Grantor, and the Grantor has good right and authority to assign and
encumber the Encumbered Lease to the Beneficiary;
(e) The Grantor is not in default in any material respect under
any of the terms thereof and, to the best of its knowledge, there are no
circumstances that, with the passage of time or the giving of notice or
both, would constitute any material event of default thereunder; and
(f) To the best of Grantor's knowledge the landlord under the
Encumbered Lease is not in default under any of the material terms or
provisions thereof on the part of the landlord to be observed or
performed.
3.4 POWERS OF TERMINATION AND RIGHTS OF REVERTER: With respect to any
fee-owned Parcel of Mortgaged Property subject to a right of reverter or power
of termination, no event has occurred or is threatened, or is likely to occur by
virtue of the performance by Grantor of any of its Obligations under any of the
Loan Documents, which would enable the beneficiary of such right or power to
cause such reversion or termination.
13
3.5 WETLANDS: To Grantor's knowledge, there are no wetlands, tidelands
or swamp and overflow lands on the Mortgaged Property. GRANTOR SHALL BE SOLELY
RESPONSIBLE FOR AND AGREES TO INDEMNIFY BENEFICIARY AND EACH SECURED CREDITOR,
PROTECT AND DEFEND WITH COUNSEL REASONABLY ACCEPTABLE TO BENEFICIARY, AND HOLD
BENEFICIARY AND EACH SECURED CREDITOR HARMLESS FROM AND AGAINST ANY CLAIMS
(INCLUDING WITHOUT LIMITATION THIRD PARTY CLAIMS FOR PERSONAL INJURY OR REAL OR
PERSONAL PROPERTY DAMAGE), ACTIONS, ADMINISTRATIVE PROCEEDINGS (INCLUDING
INFORMAL PROCEEDINGS) JUDGMENTS, DAMAGES, PUNITIVE DAMAGES, PENALTIES, FINES,
COSTS, LIABILITIES (INCLUDING SUMS PAID IN SETTLEMENTS OF CLAIMS), INTEREST OR
LOSSES, REASONABLE ATTORNEYS' FEES (INCLUDING ANY FEES AND EXPENSES INCURRED IN
ENFORCING THIS INDEMNITY), CONSULTANT FEES, AND EXPERT FEES THAT ARISE DIRECTLY
OR INDIRECTLY FROM OR IN CONNECTION WITH THE PRESENCE ON THE MORTGAGED PROPERTY
OF WETLANDS, TIDELANDS OR SWAMP AND OVERFLOW LANDS, OR ANY BREACH OF THE
FOREGOING REPRESENTATION AND WARRANTY; PROVIDED THAT SUCH INDEMNITY SHALL NOT,
AS TO ANY INDEMNIFIED PARTY, BE AVAILABLE TO THE EXTENT THAT SUCH LIABILITIES,
OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS,
EXPENSES OR DISBURSEMENTS ARE DETERMINED BY A COURT OF COMPETENT JURISDICTION BY
FINAL AND NON-APPEALABLE JUDGMENT TO HAVE RESULTED PRIMARILY FROM THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNIFIED PARTY. THE PROVISIONS OF
THIS SECTION 3.5 SHALL SURVIVE THE TERMINATION AND RECONVEYANCE OF THIS
MORTGAGE.
3.6 ENVIRONMENTAL MATTERS: Except as disclosed in the Credit Agreement,
or to the extent that any deviation from any representation in this Section 3.6
would not reasonably be expected to have a Material Adverse Effect, the Grantor
and each Subsidiary is in compliance with all applicable Environmental Laws and
has been issued and will maintain and keep current all required federal, state
and local permits, licenses, certificates and approvals. Except as disclosed in
the Credit Agreement, neither the Grantor nor, to the Grantor's knowledge, any
previous owner or operator of the Mortgaged Property or any other Person, (a)
has used or is using the Mortgaged Property in violation of any Environmental
Law in effect at the time of such use; (b) has managed, generated, stored,
released, discharged, treated, or disposed of any Hazardous Material on any
portion of the Mortgaged Property in a manner that could be reasonably expected
to have a Material Adverse Effect; or (c) has transferred or caused to be
transferred any Hazardous Material from the Mortgaged Property to any other
location except in compliance with any and all applicable Environmental Laws.
Except for Hazardous Materials necessary for the routine maintenance of the
Mortgaged Property and as used in the ordinary course of the Grantor's business,
which Hazardous Material shall be used in accordance with all applicable
Environmental Laws, the Grantor covenants that it shall not permit any Hazardous
Materials to be brought on to the Mortgaged Property, or if so brought or found
located thereon, shall be immediately removed, with proper treatment, disposal,
or other management or remediation, and all environmental cleanup requirements,
if any, shall be diligently undertaken pursuant to all Environmental Laws.
Except as disclosed in the Credit Agreement, or to the
14
extent that any deviation from any representation in this Section 3.6 would not
reasonably be expected to have a Material Adverse Effect, neither the Grantor
nor any Subsidiary has been notified of any pending or threatened action, suit,
proceeding or investigation, and neither the Grantor nor any Subsidiary is aware
of any facts, which (i) calls into question, or could reasonably be expected to
call into question, compliance by the Grantor or any Subsidiary with any
Environmental Laws, (ii) seeks, or could reasonably be expected to form the
basis of a meritorious proceeding to seek, to suspend, revoke or terminate any
license, permit or approval necessary for the operations of the Grantor's or
Subsidiary's business or facilities or for the generation, handling, storage,
treatment or disposal of any Hazardous Materials, or (iii) seeks to cause, or
could reasonably be expected to form the basis of a meritorious proceeding to
cause, any property of the Grantor or any Subsidiary to be subject to any
restrictions on ownership, use, occupancy or transferability under any
Environmental Laws.
ARTICLE IV
AFFIRMATIVE COVENANTS
Grantor hereby unconditionally covenants and agrees with Beneficiary as
follows:
4.1 PAYMENT AND PERFORMANCE: Grantor will satisfy and perform the
Obligations, including the payment of any sums required thereby, in full and on
or before the dates the same are to be satisfied and performed.
4.2 COMPLIANCE WITH LEGAL REQUIREMENTS: Grantor will promptly and
faithfully comply with, conform to and obey in all material respects all Legal
Requirements whether or not the same shall necessitate structural changes in or
improvements to, or interfere with the use or enjoyment of, the Mortgaged
Property; and provided, that Grantor shall have the right in good faith to
contest any such Legal Requirement only so long as the Mortgaged Property
affected thereby shall be in no danger of being sold, forfeited or lost pursuant
to such contest and adequate reserves have been set aside by Grantor, in
accordance with GAAP, to pay the cost necessary to comply with such Legal
Requirement in the event Grantor fails to prevail in such contest. Grantor will
procure and continuously maintain in full force and effect all permits, licenses
and other authorizations required for construction of improvements, for any
permitted use of the Mortgaged Property or any part thereof then being made and
for the lawful and proper installation, operation and maintenance of the
Mortgaged Property. Grantor will not knowingly maintain any nuisance on the
Mortgaged Property.
4.3 LIEN STATUS: Grantor will defend and protect the lien, security
title and security interest status of this Mortgage subject only to the
Permitted Encumbrances. If Grantor shall fail to satisfy its obligations under
this Section 4.3, Beneficiary shall have the rights granted by Section 10.7
hereof to take such actions as Beneficiary deems necessary to defend and protect
the lien, security title and security interest status of this Mortgage, subject
as aforesaid. Grantor shall reimburse Beneficiary for any losses or Expenses
actually incurred by Beneficiary if an interest in the Mortgaged Property, other
than as permitted hereunder, is claimed by others.
15
4.4 [INTENTIONALLY DELETED]
4.5 [INTENTIONALLY DELETED]
4.6 INSURANCE: Grantor will maintain or cause to be maintained with
financially sound and reputable insurance companies not Affiliates of the
Borrower, upon and relating to the Mortgaged Property policies of liability,
casualty, business interruption, "all-risk" permanent and, if applicable, flood
insurance in amounts and on terms customarily maintained by owners of property
located in the general vicinity of the Mortgaged Property and on which is
located similar improvements and shall insure against such risks as are
customarily insured against by businesses of like size and type engaged in the
same or similar operations. Each such policy of liability insurance shall name
Beneficiary as an additional insured party with respect to the Mortgaged
Property, and each such casualty insurance policy shall name Beneficiary as a
loss payee. Each such insurance policy shall be renewed, if renewal is
available, and shall not be canceled and further, shall not be endorsed, altered
or reissued to effect a change in coverage in any manner materially adverse to
the Beneficiary, for any reason and to any extent whatsoever unless such insurer
shall have first given Beneficiary thirty (30) days' prior written notice
thereof. Beneficiary shall be furnished with the original of each such initial
policy or a certificate with a duplicate of such original policy coincident with
the execution of this Mortgage and satisfactory evidence of renewal thereof not
less than thirty (30) days prior to the expiration of the initial or each
preceding renewal policy together with receipts or other evidence that the
premiums thereon have been paid, with the original of each renewal policy or a
certificate with a duplicate of such renewal policy to follow as soon as
available or, in any such case, an appropriate broker's certificate in respect
thereto.
4.7 RESTORATION FOLLOWING CASUALTY: If any acts or occurrences of any
kind or nature, ordinary or extraordinary, foreseen or unforeseen, shall result
in damage to or loss or destruction of the Mortgaged Property, Grantor will give
prompt notice thereof to Beneficiary. If (a) there are sufficient insurance
proceeds or sufficient other amounts available to Grantor to fully pay for the
restoration, repair or replacement (hereinafter called "Work") of the Mortgaged
Property, (b) no Default or Event of Default shall have occurred and be
continuing, (c) neither Grantor nor Lessor has elected to terminate the
Encumbered Lease, if any, pursuant to the terms thereof and confirmation of the
same has been delivered to Beneficiary, (d) the Grantor presents sufficient
evidence to the Beneficiary that the damaged property will be restored prior to
the earliest to occur of the Revolving Credit Maturity Date, the Term Loan A
Maturity Date, the Term Loan B Maturity Date or the Term Loan C Maturity Date
and (e) the Beneficiary will not incur any liability to any other person as a
result of such use or release of insurance proceeds, then Grantor may so certify
to Beneficiary, and if Grantor delivers such certificate, will certify that it
will, and shall, within 90 days following reaching an agreement with the insurer
under the casualty insurance policy relating thereto with regard to the
disbursement of insurance proceeds commence and thereafter continue diligently
to completion, to restore, repair, replace and rebuild such Mortgaged Property
as nearly as possible to its value, condition and character immediately prior to
such damage, loss or destruction with such alterations, modifications and/or
betterments reasonably deemed necessary or desirable by Grantor in its business
judgment. If the conditions set forth in such certificate of Grantor are not
satisfied with respect to a casualty, or if Grantor fails to deliver such a
certificate to Beneficiary by the date that is the later of 90 days after so
reaching an agreement with the insurer or 180 days following the casualty, or if
Grantor shall
16
thereafter fail to diligently pursue the restoration, repair, replacement or
rebuilding of such Mortgaged Property as provided herein, the insurance proceeds
related thereto shall be promptly paid to Beneficiary and applied to the
outstanding balance of the Obligations in accordance with Section 2.06(d) of the
Credit Agreement.
4.8 APPLICATION OF PROCEEDS: Insurance proceeds to be used for Work,
which proceeds are equal to or greater than $5,000,000 on a per occurrence or
claim basis, initially shall be paid to Beneficiary, and provided no Default or
Event of Default shall have occurred and be continuing, shall be paid out by
Beneficiary to Grantor at such time as Grantor makes the election set forth
below. Insurance proceeds to be used for Work, which proceeds are less than
$5,000,000 on a per occurrence or claim basis, initially shall be paid to
Grantor. Insurance proceeds shall be used by Grantor to perform such Work in
accordance with Section 4.7, with any excess thereof used to repay the
Obligations in accordance with Section 4.7. As long as no Default or Event of
Default shall have occurred and be continuing, Grantor shall have 180 days after
such casualty to elect to either (i) perform such Work or (ii) deliver such
proceeds to Beneficiary to be applied to the outstanding balance of the
Obligations in accordance with Section 2.06(d) of the Credit Agreement. In the
event Grantor elects to restore, repair, replace or rebuild the Mortgaged
Property and subsequently fails to comply with any of the conditions set forth
in Section 4.7 and this Section 4.8, any proceeds remaining to be disbursed,
whether held by Grantor, Beneficiary or an insurance company, shall be paid to
Beneficiary and, at its option, applied to the outstanding balance of the
Obligations in accordance with Section 2.06(d) of the Credit Agreement.
4.9 [INTENTIONALLY DELETED]
4.10 [INTENTIONALLY DELETED]
4.11 APPRAISALS: Upon the occurrence of an Event of Default, the Grantor
agrees and consents to the Beneficiary ordering a current written appraisal or
re-appraisal of the Mortgaged Property (at the Grantor's expense). Such
appraisal shall be by a qualified appraiser designated by and satisfactory to
the Beneficiary and must be satisfactory to the Beneficiary in form and
substance.
4.12 TAXES: Grantor shall pay, together with interest, fines, and
penalties, if any, any documentary stamp, recording, transfer, mortgage,
intangibles (including without limitation all recurring intangible taxes) or
other taxes or fees whatsoever due under the laws of the State in connection
with the making, execution, delivery, filing of record, recordation, assignment,
release, or discharge of any of the Loan Documents or in connection with any
advances made thereunder. This obligation shall survive the repayment of the
Obligations and shall continue for so long as Beneficiary could be assessed for
such taxes or fees, or for penalties or interest with respect to such taxes or
fees.
4.13 COLLECTION COSTS: In the event that this Mortgage is foreclosed, or
in the event this Mortgage is put into the hands of an attorney for collection,
suit, action or foreclosure, or in the event of the foreclosure of any mortgage
prior to or subsequent to this Mortgage, in which proceeding Beneficiary is made
a party, or in the event of the bankruptcy of the Grantor, or an assignment by
the Grantor for the benefit of creditors, Grantor, its successors and assigns,
shall
17
be chargeable with and agrees to pay all costs of collection and defense,
including an amount as attorneys' fees not to exceed such amount as may be
permitted by the laws of the applicable State including reasonable actual
attorneys' fees for all appellate proceedings and post-judgment action involved
therein, the payment of which charges, fees and taxes together with all costs
and expenses, shall be secured hereby.
4.14 [INTENTIONALLY DELETED]
4.15 [INTENTIONALLY DELETED]
4.16 CREATION AND RECORDATION OF ADDITIONS AND BETTERMENTS: Grantor shall
arrange for timely recording or filing, as required, of all documents having to
do with additions to or betterments of any portion of the Mortgaged Property,
and the covenants and agreements set forth in this Mortgage shall apply to all
such additions and betterments.
4.17 CONSENTS: Grantor will obtain and maintain the consent or approval
of any Person whose consent or approval is required to the granting of a Lien on
any interest in the Mortgaged Property to the Beneficiary.
4.18 COVENANTS RELATING TO ENCUMBERED LEASES: With respect to the
Encumbered Leases, if any:
(a) Grantor will make all payments and otherwise perform in all
material respects all obligations in respect of all Encumbered Leases,
and, subject to subsection (b) below, will maintain such Encumbered Leases
in full force and effect and not allow such Encumbered Leases to lapse or
be terminated (except in connection with the exercise by Grantor of a
purchase option in respect of the real and other property subject to such
Encumbered Lease) or any rights to renew such Encumbered Leases or options
to purchase the premises demised thereby to be forfeited or canceled.
Grantor will notify Beneficiary of any material default by any party with
respect to such Encumbered Leases and Grantor will promptly notify
Beneficiary of the giving of any notice by the Lessor to Grantor of any
default by Grantor in the performance or observance of any of the terms,
covenants or conditions of the Encumbered Lease on the part of Grantor, as
tenant under the Encumbered Lease, to be performed or observed and
promptly deliver to Beneficiary a true copy of each such notice.
(b) Except with respect to the termination of an Encumbered Lease
in connection with the exercise by Grantor of a purchase option in respect
of any real and other property subject to any Encumbered Lease, Grantor
will not, without the written consent of the Beneficiary, cancel or
terminate any Encumbered Lease or consent to or accept any cancellation or
termination thereof, or amend or otherwise modify any Encumbered Lease or
give any consent, waiver or approval thereunder, or waive any default
thereunder or breach thereof, agree in any manner to any other amendment,
modification or change of any term or condition of any Encumbered Lease,
or take any other action in connection with any Encumbered Lease that
would, or would be reasonably likely to, individually or in the aggregate,
(A) impair the rights and interests of the Beneficiary, (B) result in
expiration or termination of any Encumbered Lease prior
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to November 15, 2009, or (C) prevent the unfettered use by the Grantor of
the premises leased thereunder for any and all activities being conducted
on the Mortgaged Property as of the date hereof. Grantor shall exercise
all rights to renew the Encumbered Lease by timely notice to the Lessor as
required by the Encumbered Lease so that the Encumbered Lease will not
expire or terminate prior to November 15, 2009. Grantor hereby authorizes
and appoints Beneficiary its attorney in fact to exercise any option to
renew the Encumbered Lease in the name of and upon behalf of Grantor,
which power of attorney shall be irrevocable and deemed to be coupled with
an interest. As further security for the payment and performance of the
Obligations, Grantor hereby assigns to Beneficiary, as further security
for the payment and performance of the Obligations, all of the rights,
privileges, and prerogatives of Grantor, as tenant under the Encumbered
Lease, to surrender the leasehold estate created by the Encumbered Lease
or to terminate, cancel, modify, change, supplement or alter the
Encumbered Lease, and any such surrender of the leasehold estate created
by the Encumbered Lease or termination, cancellation, modification,
change, supplement, alteration or amendment of the Encumbered Lease
without the prior consent of Beneficiary shall be null and void and of no
force and effect.
(c) Subject to the foregoing, if Grantor defaults under subsection
(a) hereof by failing to make any payment required to be made by Grantor
pursuant to the provisions of any Encumbered Lease or to keep, observe or
perform, or cause to be kept, observed or performed, any of the terms,
covenants, provisions or agreements of any Encumbered Lease (unless waived
by lessor under such Encumbered Lease), Grantor agrees that Beneficiary
may (but shall not be obligated to) take any action on behalf of Grantor
(with right of entry onto the Mortgaged Property), to keep or cause to be
kept, observed or performed any such terms, covenants, provisions or
agreements and to enter upon the Mortgaged Properties (after reasonable
advance notice to Grantor) and take all such action thereon as may be
reasonably necessary therefor, and all money so expended by Beneficiary,
with interest thereon at the Default Rate from the date of each such
expenditure, shall be paid by Grantor to Beneficiary promptly upon demand
by Beneficiary and shall be added to the indebtedness secured by this
Mortgage. If Beneficiary shall make any payment or perform any act or take
any action in accordance with the preceding sentence, then the payment,
performance or action shall not remove or waive, as between Grantor and
Beneficiary, the corresponding default under the terms of this Mortgage.
(d) Grantor covenants and agrees that, unless Beneficiary shall
otherwise expressly consent in writing, neither Grantor nor its successors
or assigns shall suffer or permit the fee title to the property demised by
any Encumbered Lease and the leasehold estate thereunder to merge, it
being understood and agreed that said estates shall always remain separate
and distinct, notwithstanding the union of said estates in any person
whomever by purchase or otherwise; and in case Grantor acquires the fee
title or any other estate, title or interest in the Mortgaged Property,
this Mortgage shall attach to and cover and be a lien upon the fee title
or such other estate so acquired, and such fee title or other estate
shall, without further assignment, mortgage or conveyance, become and be
subject to the lien of and covered by this Mortgage.
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(e) If any Encumbered Lease shall be terminated prior to the
natural expiration of its term due to default by the lessee or tenant
thereunder, and if, pursuant to any provision of such Encumbered Lease or
pursuant to Beneficiary's exercise of its rights hereunder or under any
other Loan Document, the Beneficiary or its designee shall acquire from
the lessor a new lease of the Mortgaged Property, Grantor shall have no
right, title, or interest in or to such new lease or the leasehold estate
created thereby, or renewal privileges therein contained.
(f) Grantor will not subordinate or consent to the subordination
of the Encumbered Lease to any mortgage, deed of trust, lease or other
interest on or in the Lessor's interest in all or any part of the
Mortgaged Property, unless, in each such case, the written consent of
Beneficiary shall have been first had and obtained.
4.19 LESSOR'S BANKRUPTCY:
(a) Grantor acknowledges that pursuant to Section 365 of the
Bankruptcy Code it is possible that a trustee in bankruptcy of the Lessor
under an Encumbered Lease, if any, or Lessor as a debtor-in-possession
could reject the Encumbered Lease, if any, in which case Grantor, as
lessee, would have the Election described in Section 365(h) of the
Bankruptcy Code to treat such Encumbered Lease as terminated by such
rejection or, in the alternative, to remain in possession for the balance
of the term of the Encumbered Lease and any renewal or extension thereof
that is enforceable by the lessee under applicable nonbankruptcy law.
(b) Grantor covenants that it will not suffer or permit the
termination of the Encumbered Lease by exercise of the Election or
otherwise without the prior written consent of Beneficiary. Grantor
acknowledges that since the Encumbered Lease is a primary part of the
security for the Obligations secured hereby, it is not anticipated that
Beneficiary would consent to termination of the Encumbered Lease in
connection with any such election and Beneficiary shall not under any
circumstances be obliged to give such consent.
(c) In order to secure the covenant made in this Section 4.19 and
as security for the Obligations, Grantor assigns the Election and all
rights related thereto to Beneficiary. Grantor acknowledges and agrees
that the foregoing assignment of the Election and related rights is one of
the rights which Beneficiary may use at any time in order to protect and
preserve the other rights and interests of Beneficiary under this
Mortgage, since exercise of the Election in favor of terminating the
Encumbered Lease would constitute waste hereunder.
(d) Grantor acknowledges and agrees that the Election is in the
nature of a remedy and is not a property interest which Grantor can
separate from the Encumbered Lease. Therefore, Grantor agrees that
exercise of the Election in favor of preserving the right to possession
under the Encumbered Lease shall not be deemed to constitute a taking or
sale of the Mortgaged Property by Beneficiary and shall not entitle
Grantor to any credit against the Obligations secured by this Mortgage.
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(e) Grantor acknowledges and agrees that in the event the Election
is exercised in favor of Grantor remaining in possession, Grantor's
resulting rights under the Encumbered Lease, as adjusted by the effect of
Section 365 of the Bankruptcy Code, shall then be part of the Mortgaged
Property and shall be subject to the lien created by this Mortgage.
(f) Beneficiary shall have the right to proceed in its own name or
in the name of Grantor in respect of any claim, suit, action or proceeding
relating to the rejection of the Encumbered Lease by the Lessor or any
other party, including, without limitation, the right to file and
prosecute under the Bankruptcy Code, without joining or the joinder of
Grantor, any proofs of claim, complaints, motions, applications, notices
and other documents. Any amounts received by Beneficiary as damages
arising out of the rejection of the Encumbered Lease as aforesaid shall be
applied first to all costs and expenses of Beneficiary (including, without
limitation, attorneys' fees) incurred in connection with the exercise of
any of its rights or remedies under this paragraph. Grantor acknowledges
that the assignment of all claims and rights to the payment of damages
from the rejection of the Encumbered Lease made under the granting clauses
of this Mortgage constitutes a present irreversible and unconditional
assignment and Grantor shall, at the request of Beneficiary, promptly
make, execute, acknowledge and deliver, in form and substance satisfactory
to Beneficiary, a UCC Financing Statement (Form UCC-1) and all such
additional instruments, agreements and other documents, as may at any time
hereafter be required by Beneficiary to carry out such assignment.
(g) If pursuant to Subsection 365(h)(2) of the Bankruptcy Code,
Grantor shall seek to offset against the rent reserved in the Encumbered
Lease the amount of any damages caused by the nonperformance by the Lessor
or any other party of any of their respective obligations under such
Encumbered Lease after the rejection by the Lessor or such other party of
such Encumbered Lease under the Bankruptcy Code, then Grantor shall, prior
to effecting such offset, notify Beneficiary of its intent to do so,
setting forth the amount proposed to be so offset and the basis therefor.
Beneficiary shall have the right to object to all or any part of such
offset that, in the reasonable judgment of Beneficiary, would constitute a
breach of such Encumbered Lease, and in the event of such objection,
Grantor shall not effect any offset of the amounts found objectionable by
Beneficiary. Neither Bank's failure to object as aforesaid nor any
objection relating to such offset shall constitute an approval of any such
offset by Beneficiary.
(h) If any action, proceeding, motion or notice shall be commenced
or filed in respect of the Lessor under the Encumbered Lease or any other
party or in respect of the Encumbered Lease in connection with any case
under the Bankruptcy Code, then Beneficiary shall have the option,
exercisable upon notice from Beneficiary to Grantor, to conduct and
control any such litigation with counsel of Beneficiary's choice.
Beneficiary may proceed in its own name or in the name of Grantor in
connection with any such litigation, and Grantor agrees to execute any and
all powers, authorizations, consents or other documents required by
Beneficiary in connection therewith. Grantor shall, upon demand, pay to
Beneficiary all costs and expenses (including attorneys' fees) paid or
incurred by Beneficiary in connection with the prosecution or conduct of
any such proceedings. Grantor shall not commence any action, suit,
proceeding or case, or file any
21
application or make any motion, in respect of the Encumbered Lease in any
such case under the Bankruptcy Code without the prior written consent of
Beneficiary.
(i) Grantor shall, after obtaining knowledge thereof, promptly
notify Beneficiary of any filing by or against the Lessor or other party
with an interest in the Land of a petition under the Bankruptcy Code.
Grantor shall promptly deliver to Beneficiary, following receipt, copies
of any and all notices, summonses, pleadings, applications and other
documents received by Grantor in connection with any such petition and any
proceedings relating thereto.
(j) If there shall be filed by or against Grantor a petition under
the Bankruptcy Code and Grantor, as lessee under the Encumbered Lease,
shall determine to reject the Encumbered Lease pursuant to Section 365(a)
of the Bankruptcy Code, then Grantor shall give Beneficiary not less than
twenty (20) days' prior notice of the date on which Grantor shall apply to
the Bankruptcy Court for authority to reject the Encumbered Lease.
Beneficiary shall have the right, but not the obligation, to serve upon
Grantor within such twenty (20) day period a notice stating that
Beneficiary demands that Grantor assume and assign the Encumbered Lease to
Beneficiary pursuant to Section 365 of the Bankruptcy Code. If Beneficiary
shall serve upon Grantor the notice described in the preceding sentence,
Grantor shall not seek to reject such Encumbered Lease and shall comply
with the demand provided for in the preceding sentence. In addition,
effective upon the entry of an order for relief with respect to Grantor
under the Bankruptcy Code, Grantor hereby assigns and transfers to
Beneficiary a non-exclusive right to apply to the Bankruptcy Court under
subsection 365(d)(4) of the Bankruptcy Code for an order extending the
period during which the Encumbered Lease may be rejected or assumed.
4.20 [INTENTIONALLY DELETED]
4.21 CHANGE OF NAME OR ADDRESS: Within 10 days following any change in
Grantor's name or address (as specified in the Loan Documents), Grantor shall
give written notice of such change to Beneficiary, and shall promptly execute
(and acknowledge, as necessary) all documents and agreements reasonably required
by Beneficiary or the Secured Creditors to confirm or maintain the security
interests granted herein or in the other Loan Documents.
4.22 ENVIRONMENTAL ASSESSMENT REPORTS: The Grantor agrees, upon
reasonable request of the Beneficiary after an Event of Default has occurred and
is continuing or if Beneficiary reasonably suspects that there exists a
violation of any Environmental Law that could possibly result in a Material
Adverse Effect or a release of Hazardous Materials that is not otherwise
incompliance with any and all Environmental Laws with respect to the Mortgaged
Property, to provide the Beneficiary (at the Grantor's expense) with a current
environmental assessment report of the Mortgaged Property within a reasonable
time after such request. Such assessment report shall focus on such suspected
violation or release only, be in a form satisfactory to the Beneficiary and from
an environmental engineer or consultant reasonably satisfactory to the
Beneficiary. The results of any such assessment report shall be deemed
confidential Information (as defined in Section 10.08 of the Credit Agreement)
and shall be subject to the confidentiality provisions set forth in Section
10.08 of the Credit Agreement.
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4.23 RESPONSE TO ENVIRONMENTAL COMPLAINT: Grantor shall, within the time
period permitted and to the extent required by the applicable Environmental Law
or the Governmental Authority responsible for enforcing such Environmental Law,
remove, remedy or respond to (which may include without limitation the defense
of any such enforcement action so long as such enforcement action is being
contested in good faith by appropriate proceedings diligently conducted and a
bona fide dispute exists with respect thereto) or cause to be removed, remedied
or responded to, any violation of any Environmental Law or any release of any
Hazardous Material or satisfy any liability for the costs of cleaning up,
removing, remediating or responding to a release of Hazardous Materials.
4.24 INDEMNIFICATION: THE GRANTOR HEREBY AGREES THAT IT WILL REIMBURSE
THE BENEFICIARY AND THE SECURED CREDITORS FOR, AND DEFEND, INDEMNIFY AND HOLD
THE BENEFICIARY AND THE SECURED CREDITORS, AND THEIR RESPECTIVE OFFICERS,
DIRECTORS, EMPLOYEES AND AGENTS HARMLESS FROM AND AGAINST, ANY AND ALL CLAIMS,
COSTS, EXPENSES, LOSSES, PENALTIES, LIABILITIES AND DAMAGES (INCLUDING, WITHOUT
LIMITATION, ASSESSMENT AND CLEANUP COSTS AND REASONABLE ATTORNEYS', CONSULTANTS'
AND OTHER EXPERTS' FEES, EXPENSES AND DISBURSEMENTS) AND ALL JUDGMENTS, FINES
AND PENALTIES INCURRED, ENTERED OR LEVIED AGAINST THE BENEFICIARY OR SECURED
CREDITORS BY ANY GOVERNMENTAL AGENCY OR AUTHORITY ARISING DIRECTLY OR INDIRECTLY
FROM, OR AS A RESULT OF OR IN CONNECTION WITH (A) THE USE OF THE MORTGAGED
PROPERTY; (B) THE USE OF THE FACILITIES THEREON; (C) THE USE, GENERATION,
STORAGE, TRANSPORTATION, TREATMENT, EMISSION, DISCHARGE, DISPOSAL, RELEASE OR
HANDLING OF ANY HAZARDOUS MATERIALS AT, UPON OR FROM THE MORTGAGED PROPERTY; OR
(D) THE VIOLATION OR ALLEGED VIOLATION OF ANY ENVIRONMENTAL LAW BY GRANTOR OR
ANY SUBSIDIARY; PROVIDED THAT SUCH INDEMNITY SHALL NOT, AS TO ANY INDEMNIFIED
PARTY, BE AVAILABLE TO THE EXTENT THAT SUCH LIABILITIES, OBLIGATIONS, LOSSES,
DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES OR DISBURSEMENTS
ARE DETERMINED BY A COURT OF COMPETENT JURISDICTION BY FINAL AND NON-APPEALABLE
JUDGMENT TO HAVE RESULTED PRIMARILY FROM THE GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF SUCH INDEMNIFIED PARTY. THE GRANTOR'S OBLIGATIONS UNDER THIS
SECTION 4.24 SHALL SURVIVE THE REPAYMENT OF THE OBLIGATIONS AS DEFINED IN THE
CREDIT AGREEMENT, CANCELLATION OF THE LETTERS OF CREDIT, THE OCCURRENCE OF THE
FACILITY TERMINATION DATE, AND EXPIRATION OR TERMINATION OF THIS MORTGAGE OR ANY
FORECLOSURE OR A DEED IN LIEU OF FORECLOSURE OF THIS MORTGAGE OR OTHER
COLLATERAL SECURING THE OBLIGATIONS.
4.25 [INTENTIONALLY DELETED]
4.26 TRANSFER OF LICENSE: If Beneficiary acquires title to the Mortgaged
Property, Grantor shall execute, deliver and file or use its best efforts to
cause the tenant under the Lease
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of the Mortgaged Property to execute, deliver and file all documents and
statements requested by Beneficiary to effect the transfer of the licenses and
other governmental authorizations necessary for the continued use and operation
of the Mortgaged Property, subject to any required approval of governmental
regulatory authorities, and shall provide to Beneficiary all information and
records required in connection therewith.
ARTICLE V
NEGATIVE COVENANTS
Grantor hereby covenants and agrees with Beneficiary that, until all of
the Obligations shall have been fully paid, performed, satisfied and discharged,
all of the Commitments shall have been terminated in whole, all of the Letters
of Credit shall have been cancelled and returned to the L/C Issuer and the
Facility Termination Date has occurred:
5.1 RIGHTS OF REVERTER AND POWERS OF TERMINATION: With respect to any
fee-owned Parcel of Mortgaged Property subject to a right of reverter or power
of termination, and so long as such right or power is or may be enforceable,
Grantor:
(a) will not take or omit to take any action or change the use of
such Parcel or otherwise so as to enable the beneficiary of such right or
power to enforce or obtain the benefit of such reversion or termination;
and
(b) will not file for or otherwise initiate any proceedings to
abandon such Parcel.
ARTICLE VI
DEFAULT AND FORECLOSURE
6.1 REMEDIES: If an Event of Default shall have occurred, and all or any
portion of the Obligations then remaining unpaid shall have been declared due
and payable in accordance with the Loan Documents, then, without notice or
demand, which are hereby expressly waived to the extent permitted under
applicable law, the Beneficiary may exercise any or all of the following rights,
remedies and recourses:
(a) Entry Upon Mortgaged Property: To the extent permitted by
applicable Legal Requirements, enter upon all or any part of the Mortgaged
Property and take exclusive possession thereof and of all books, records
and accounts relating thereto. If Grantor remains in possession of all or
any part of the Mortgaged Property after an Event of Default and without
Beneficiary's prior written consent thereto, Beneficiary may invoke any
and all legal remedies to dispossess Grantor, including without limitation
one or more actions for forcible entry and detainer, trespass to try title
and writ of restitution. Nothing contained in the foregoing sentence
shall, however, be construed to impose any greater obligation or any
prerequisites to acquiring possession of the Mortgaged Property after an
Event of Default than would have existed in the absence of such sentence.
24
(b) Operation of Mortgaged Property:
(i) To the extent permitted by applicable Legal
Requirements, by itself or by the appointment of a receiver in
accordance with applicable Legal Requirements, hold, lease, manage,
operate or otherwise use or permit the use of all or any portion of
the Mortgaged Property, either by itself or by other persons, firms
or entities, in such manner, for such time and upon such other terms
as Beneficiary may deem to be prudent and reasonable under the
circumstances (making such repairs, alterations, additions and
improvements thereto and taking any and all other action with
reference thereto, from time to time, as Beneficiary shall
reasonably deem necessary or desirable), and apply all Rents and
other amounts collected by Beneficiary in connection therewith in
accordance with the provisions of Section 6.6 below.
(ii) To the extent permitted by applicable Legal
Requirements, as attorney-in-fact or agent of the Grantor, or in its
own name as Beneficiary or by the appointment of a receiver in
accordance with applicable Legal Requirements and under the powers
herein granted, hold, operate, manage, and control all or any
portion of the Mortgaged Property and conduct the business, if any,
thereof, either personally or by its agents, and to exercise the
powers described in Section 8.3 hereof. Such remedies may be
exercised cumulatively and concurrently, and in this respect
Beneficiary shall be entitled to avail itself of the benefits and
rights stated in Section 6.3 below.
(c) Foreclosure: Institute a proceeding, judicial or otherwise,
for the complete foreclosure of this Mortgage to the fullest extent
permitted by law; or (ii) institute a proceeding or proceedings, judicial
or otherwise, for the partial foreclosure of this Mortgage, as permitted
by applicable Legal Requirements for the portion of the Obligations then
due and payable, with this Mortgage then continuing unimpaired and without
loss of priority so as to secure the balance of the Obligations.
(d) Special State Provisions:
(i) Pennsylvania. To the extent the applicable portion of
the Mortgaged Property is situated in the Commonwealth of
Pennsylvania, the following provisions shall apply. In addition to
all other rights and remedies hereunder:
(A) Beneficiary may (1) institute and maintain an
action of mortgage foreclosure against any or all of the
Mortgaged Property, (2) institute and maintain an action on
the Loan Documents, (3) sell any of the Mortgaged Property, or
(4) take such other action at law or in equity for the
enforcement of any Loan Document as the law may allow.
Beneficiary may proceed in any such action to final judgment
and execution thereon for (1) all sums due herein or under any
Loan Document, together with interest on such sums as provided
herein, all costs of suit and reasonable attorneys' fees, or,
at Beneficiary's option (2)
25
all amounts due under the Loan Documents without acceleration,
together with interest as provided herein, all costs of suit
and reasonable attorneys' fees. Interest at the Default Rate
shall be due on any judgment obtained by Beneficiary from the
date of judgment until actual payment is made of the full
amount of the judgment by the Sheriff or otherwise.
(B) Beneficiary may, without releasing Grantor from
any obligation under any Loan Document or under any Lease, or
any Encumbered Lease or waiving any Event of Default: (i)
collect (or, continue to collect) any or all of the Rents,
including any Rents past due and unpaid, (ii) perform any
obligation or exercise any right or remedy of Grantor under
any Lease or Encumbered Lease, or (iii) enforce any obligation
of any tenant of any of the Mortgaged Property. Beneficiary
shall not be obligated to do any of the foregoing, even if
Beneficiary may have performed any obligation or exercised any
remedy of landlord or have enforced any obligation of a
tenant. Beneficiary may exercise any right under this
paragraph whether or not Beneficiary shall have entered into
possession of any of the Mortgaged Property; and nothing
herein contained shall be construed as constituting
Beneficiary a "mortgagee in possession," unless Beneficiary
shall have entered into and shall remain in actual possession
of the Mortgaged Property. Grantor hereby authorizes and
instructs each and every present and future tenant of any of
the Mortgaged Property to perform all obligations (in addition
to the payment of Rents) of that tenant for the direct benefit
of Beneficiary, as if Beneficiary were the landlord under the
Lease with that tenant, immediately upon receipt of a demand
by Beneficiary to perform such obligations. No tenant shall
have any responsibility to ascertain whether such demand is
permitted hereunder or whether an Event of Default shall have
occurred; Grantor hereby waives any right, claim or demand it
may now or hereafter have against any such tenant by reason of
such performance of obligations for the benefit of
Beneficiary; and any such performance for the benefit of
Beneficiary shall discharge the obligations of the tenant to
make such performance for the benefit of Grantor. Grantor
shall indemnify Beneficiary and hold Beneficiary harmless from
any and all liability under any Lease and/or Encumbered Lease
and from any and all claims and demands which may be asserted
against Beneficiary by reason of any alleged obligations to
perform any provision of any Lease or Encumbered Lease.
(C) Beneficiary may, without releasing Grantor from
any obligation under any Loan Document or under any Lease or
Encumbered Lease or waiving any Event of Default, enter upon
and take possession of any of the Mortgaged Property, with or
without legal action and by force if necessary, or have a
receiver appointed without proof of depreciation or inadequacy
of the value of the Mortgaged Property or other security,
proof of the insolvency of Grantor or proof of fraud or waste.
Beneficiary or said receiver may manage and operate any of the
Mortgaged Property;
26
make, cancel, enforce or modify Leases, Encumbered Lease or
any other contract relating to the operation or management of
any of the Mortgaged Property; obtain and evict tenants;
establish or change the amount of any Rents; make additions,
repairs, improvements and/or alterations to any of the
Mortgaged Property; and perform any other acts which
Beneficiary deems proper to protect the security of this
Mortgage. Any Lease, Encumbered Lease or other contract made
by Beneficiary shall survive the cure of any Event of Default
or payment of the Obligations, except to the extent that such
Lease, Encumbered Lease or contract provides otherwise.
Beneficiary may apply the Rents received by Beneficiary to the
payment of any or all of the following, in such order and
amounts as Beneficiary, in its sole discretion, may elect: all
actual costs and expenses, whenever and by whomever incurred,
of operation, alteration and management of the Mortgaged
Property and of collection of the Rents (including reasonable
attorneys' fees, administration expenses, management fees and
brokers' commissions), liens on any of the Mortgaged Property,
Impositions, claims, insurance premiums, other carrying
charges, invoices of persons who have supplied goods or
services to or for the benefit of any of the Mortgaged
Property, costs and expenses of maintenance, repair,
restoration, alteration or improvement of any of the Mortgaged
Property, or the Obligations. Beneficiary may, in its sole
discretion, determine the method by which, and extent to
which, the Rents will be collected and obligations of tenants
and other contract parties enforced; and Beneficiary may waive
or fail to enforce any right or remedy of the landlord under a
Lease or of Grantor or Beneficiary under any other contract.
Beneficiary shall not be accountable for any Rents or other
sums it does not actually receive. Grantor hereby appoints
Beneficiary as its attorney-in-fact to perform all acts which
Grantor is required or permitted to perform under any and all
Leases and the Encumbered Lease.
(D) Beneficiary may disaffirm and cancel any Lease
which is subordinate to this Mortgage at any time before the
expiration of sixty days after Beneficiary acquires the legal
title to the Mortgaged Property by any transfer pursuant to
the exercise of a remedy hereunder or otherwise, even though
Beneficiary shall have enforced such Lease, collected Rents
thereunder or taken any action that might be deemed by law to
constitute an affirmance of the Lease. Such disaffirmance
shall be made by notice addressed to the tenant at the
Mortgaged Property or, at Beneficiary's option, such other
address of the tenant as may be provided in that tenant's
Lease.
(E) Beneficiary may take possession of any of the
Mortgaged Property and may sell such property pursuant to the
provisions of the applicable Uniform Commercial Code and
exercise such other rights and remedies with respect to such
property as may be provided to a secured party by said Code.
Grantor shall, if Beneficiary so requests, assemble
27
any such property and make it available to Beneficiary at a
place or places designated by Beneficiary.
(e) Sale: To the extent permitted by applicable Legal
Requirements, sell or offer for sale the Mortgaged Property, in such
portions, order and parcels as Beneficiary may determine, with or without
having first taken possession of same, to the highest bidder for cash in
lawful money of the United States at public auction in accordance with
applicable Legal Requirements, or the UCC, and in the event of a sale, by
foreclosure or otherwise, of less than all of the Mortgaged Property, this
Mortgage shall continue as a lien and security interest on the remaining
portion of the Mortgaged Property. Beneficiary may postpone any sale by
public announcement at the time and place noticed for the sale. If the
Mortgaged Property consists of several lots, Parcels or items of property,
Beneficiary may, in its sole discretion and to the extent permitted by
applicable law: (i) designate the order in which such lots, parcels or
items shall be offered for sale or sales, or (ii) elect to sell such lots,
parcels or items through a single sale, or through two or more successive
sales or in any other manner Beneficiary deems in its best interest.
Should Beneficiary desire that more than one sale or other disposition of
the Mortgaged Property or any portion thereof be conducted simultaneously,
or successively, on the same day, or at such different days or times and
in such order as Beneficiary may deem to be in its best interests, no such
sale shall terminate or otherwise affect the lien and security interest of
this Mortgage on any part of the Mortgaged Property not sold until all the
Obligations have been fully satisfied and all Commitments of the Lenders
under the Credit Agreement have been fully terminated and all Letters of
Credit issued under the Credit Agreement shall have been canceled and
returned to the L/C Issuer, and the Facility Termination Date has
occurred. Grantor shall pay the Expenses of any sale of the Mortgaged
Property, whether one or more, and of any judicial proceedings wherein the
same may be made, including reasonable compensation to Beneficiary, its
agents and counsel, and shall pay all expenses, liabilities and advances
actually made or incurred by Beneficiary in connection with such sale or
sales, together with interest on all such advances made by Beneficiary at
the Default Rate. Upon any sale hereunder, Beneficiary shall execute and
deliver to the purchaser or purchasers a deed or deeds conveying the
property so sold, but without any covenant or warranty whatsoever, express
or implied, whereupon such purchaser or purchasers shall be let into
immediate possession; and the recitals in any such deed or deeds of facts,
such as default, the giving of notice of default and notice of sale, and
other facts affecting the regularity or validity of such sale or
disposition, shall be conclusive proof of the truth of such facts; and any
such deed or deeds shall be conclusive against all persons as to such
facts recited therein.
(f) Trustee or Receiver: Prior to, upon or at any time after,
commencement of foreclosure of the lien, security title and security
interest provided for herein or any legal proceedings pursuant hereto,
make application to a court of competent jurisdiction for appointment of a
receiver of the Mortgaged Property. Such application may be made as a
matter of strict right and without notice to Grantor (unless notice is
required by applicable Legal Requirements and such right of notice may not
be waived) or regard to the adequacy of the Mortgaged Property or
insolvency of the Grantor or any person who may be legally or equitably
liable to pay the Obligations and without giving bond to Grantor (unless
bond is required by applicable Legal Requirements and such right of bond
may
28
not be waived), and Grantor does hereby irrevocably consent to such
appointment. Any such receiver shall have all the usual powers and duties
of receivers in similar cases, including the full power to rent, maintain
and otherwise operate the Mortgaged Property all upon such terms as may be
approved by the court, and shall apply the Rents in accordance with the
provisions of this Mortgage.
(g) Separate Sales: To the extent permitted by applicable Legal
Requirements, the Mortgaged Property may be sold in one or more Parcels
and in such manner and order as Beneficiary, in its sole discretion, may
elect, it being expressly understood and agreed that the right of sale
arising out of any Event of Default shall not be exhausted by any one or
more sales.
(h) Other: Exercise any and all other rights, remedies and
recourses granted under the Loan Documents or now or hereafter existing in
equity or at law, by virtue of statute or otherwise, including, without
limitation, the right to bring an action in any court of competent
jurisdiction to foreclose this instrument as a realty mortgage or enforce
any of the terms hereof.
(i) Remedies Cumulative, Concurrent and Nonexclusive: Beneficiary
shall have all rights, remedies and recourses granted in the Loan
Documents and available at law or equity (including specifically those
granted by the UCC in effect and applicable to the Mortgaged Property)
and, except as limited by applicable Legal Requirements, the same (a)
shall be cumulative and concurrent; (b) may be pursued separately,
successively or concurrently against Grantor or against all or any portion
of the Mortgaged Property, at the sole discretion of Beneficiary; (c) may
be exercised as often as occasion therefor shall arise, it being agreed by
Grantor that the exercise or failure to exercise any of same shall in no
event be construed as a waiver or release thereof or of any other right,
remedy or recourse; and (d) are intended to be, and shall be nonexclusive.
(j) Collection of Costs and Expenses: The Beneficiary shall be
entitled to receive all costs and expenses of the sale or repossession of
the Mortgaged Property actually incurred, including the reasonable
attorneys' fees or receivers reasonable fee or commission, if any, title
and abstracting charges, reasonable attorneys' fees and a reasonable
auctioneer's fees, and all other costs and expenses incurred in exercising
its remedies hereunder.
6.2 NO CONDITIONS PRECEDENT TO EXERCISE OF REMEDIES: The Grantor shall
not be relieved of any obligation it has under the Loan Documents by reason of
(i) the release, regardless of consideration, of any of the Mortgaged Property
or any other collateral held pursuant to the Loan Documents or the addition of
any other property to the Mortgaged Property or any other such collateral; (ii)
any agreement or stipulation between any subsequent owner of all or any portion
of the Mortgaged Property and Beneficiary extending, renewing, rearranging or in
any other way modifying the terms of the Loan Documents without first having
obtained the consent of, given notice to or paid any consideration to the
Grantor, and in such event the Grantor shall continue to be liable to make
payment according to the terms of any such extension or modification agreement
unless expressly released and discharged in writing by Beneficiary; or (iii) any
other acts or occurrence, save and except the full payment and performance of
all of the
29
Obligations, and the termination of the Commitments of the Lenders under the
Credit Agreement and the cancellation and return to the L/C Issuer of all
Letters of Credit issued under the Credit Agreement and the occurrence of the
Facility Termination Date.
6.3 RELEASE OF AND RESORT TO COLLATERAL: To the fullest extent permitted
by law, Beneficiary may release, regardless of consideration, any part of the
Mortgaged Property without, as to the remainder, in any way impairing,
affecting, subordinating or releasing the lien or security interest created in
or evidenced by the Loan Documents or their stature as a first and prior lien
and security interest in and to the Mortgaged Property. For payment of the
Obligations, to the fullest extent permitted by applicable Legal Requirements,
Beneficiary may resort to any other security therefor held by Beneficiary in
such order and manner as Beneficiary may elect, and such resort may be taken
concurrently or successively and in one or several consolidated or independent
judicial actions or lawfully taken non-judicial proceedings, or both.
6.4 WAIVERS: To the fullest extent permitted by applicable Legal
Requirements, Grantor hereby irrevocably and unconditionally WAIVES and RELEASES
(a) all benefits that might accrue to Grantor by virtue of any present or future
law exempting the Mortgaged Property from attachment, levy or sale on execution
or providing for any appraisement, valuation, homestead exemption, stay of
execution, exemption from civil process, redemption or extension of time for
payment; (b) except as otherwise provided in the Loan Documents, all notices of
any demand, presentment, Event of Default, intent to accelerate or acceleration
or the election by Beneficiary to exercise or the actual exercise of any right,
remedy or recourse provided for under the Loan Documents; (c) any right to a
marshalling of assets or a sale in inverse order of alienation; and (d) any
restrictions or conditions upon the exercise by the Beneficiary of the remedies
set forth in Section 6.1.
6.5 DISCONTINUANCE OF PROCEEDINGS: To the extent permitted by applicable
Legal Requirements, in case Beneficiary shall have proceeded to invoke any
right, remedy or recourse permitted under the Loan Documents and shall
thereafter elect to discontinue or abandon same for any reason, Beneficiary
shall have the unqualified right so to do and, in such an event, the Grantor and
Beneficiary shall be restored to their former positions with respect to the Loan
Documents, the Mortgaged Property and otherwise, and the rights, remedies,
recourses and powers of Beneficiary shall continue as if same had never been
invoked.
6.6 APPLICATION OF PROCEEDS:
(a) To the extent permitted by applicable Legal Requirements, all
proceeds received from the sale or other dispositions of the Mortgaged
Property, including but not limited to, the Rents and other income
generated by the holding, leasing, operating or other use of the Mortgaged
Property, pursuant to Article 6 of this Mortgage shall be applied by the
Beneficiary (or the receiver, if one is appointed), as applicable, to the
extent that funds are so available therefrom, in accordance with the
following priorities:
First: to the costs and expenses of the sale or possession of the
Mortgaged Property actually incurred, including the receiver's reasonable
fee or commission, if any, title and abstracting charges, reasonable
attorneys' fees and a reasonable auctioneer's fee if such expense has been
incurred;
30
Second: to the satisfaction of the Obligations;
Third: to the payment to whomsoever shall be entitled thereto under
applicable Legal Requirements, if the person who made the sale knows who
is entitled thereto. Otherwise, the surplus shall be paid to the clerk of
the superior, district or circuit court (or other court having
jurisdiction) of the county where the sale was had.
(b) If the Beneficiary shall be ordered, in connection with any
bankruptcy, insolvency or reorganization of the Grantor to restore or
repay to or for the account of the Grantor or any of their creditors any
amount theretofore received under this Section 6.6, the amount for such
restoration or repayment shall be deemed to be an Obligation so as to
place the Beneficiary in the position they would have been in had such
amount never been received by any party hereto.
6.7 COOPERATION: If an Event of Default shall occur, Grantor will use
its best efforts to cooperate with Beneficiary and promptly do all things
reasonably required of it toward obtaining all necessary authority and
permission from any governmental authority or otherwise to accomplish any
disposition, abandonment or change in use of the Mortgaged Property (or any
portion thereof) as Beneficiary may request in connection with the exercise of
its rights and powers hereunder and under the other Loan Documents.
ARTICLE VII
CONDEMNATION
7.1 GENERAL: Promptly following the date on which an executive officer
of Grantor obtains knowledge of the institution or the threatened institution of
any proceeding for the condemnation of all or any portion of the Mortgaged
Property, Grantor shall notify Beneficiary of such fact. Grantor shall then,
unless Beneficiary waives this requirement, file or defend its claim in respect
of such proceeding and prosecute same with due diligence to its final
disposition. Grantor may be the nominal party in such proceeding but Beneficiary
shall be entitled to participate in same and to be represented therein by
counsel of its own choice, and Grantor will deliver or cause to be delivered to
Beneficiary such instruments as may be reasonably requested by it from time to
time to permit such participation. All proceeds received from any such
condemnation proceeding shall be paid to Beneficiary and applied to reduce the
outstanding balance of the Obligations.
7.2 REBUILDING, RESTORATION AND REPAIR: In the event (a) no Default or
Event of Default shall have occurred and be continuing, (b) only a portion of
the Mortgaged Property is taken, (c) Grantor elects to rebuild, restore or
repair the remaining portion of the Mortgaged Property, (d) there are sufficient
proceeds or other amounts available to Grantor to fully pay for the rebuilding,
restoration or repair of the Mortgaged Property, (e) neither the Grantor nor
Lessor has elected to terminate the Encumbered Lease, if any, and confirmation
of the same has been delivered to Beneficiary, (f) the Grantor presents
sufficient evidence to the Beneficiary that the Mortgaged Property will be
restored to an architectural whole prior to the earliest to occur of the
Revolving Credit Maturity Date, the Term Loan A Maturity Date, the Term Loan B
Maturity Date or the Term Loan C Maturity Date and (g) the Beneficiary will not
incur any liability to any
31
other person as a result of such use or release of proceeds, then Grantor will
so certify to Beneficiary, and will certify that it will and shall continue
diligently to completion to restore, repair, replace and rebuild such Mortgaged
Property as nearly as possible to its value, condition and character immediately
prior to such condemnation with such alterations, modifications and/or
betterments reasonably deemed necessary or desirable by Grantor in its business
judgment. Grantor shall thereafter commence the rebuilding, restoration or
repair within sixty (60) days after the date of the disbursement of the award or
settlement, and complete same to the satisfaction of the Beneficiary within a
reasonable time thereafter. Upon completion of such rebuilding, restoration and
repair in accordance with the preceding provisions, Grantor may apply such
amount or settlement to the costs of such rebuilding, restoration or repair. If
(i) there is a total condemnation of the Mortgaged Property, or (ii) if Grantor
elects not to rebuild, restore or repair as specified above, or (iii) the
requirements set forth above for rebuilding, restoration or repair after a
partial condemnation are not met to Beneficiary's satisfaction, then Grantor
shall pay to Beneficiary such award or settlement to be applied to reduce the
outstanding balance of the Obligations or if such award or settlement
constituted proceeds of casualty insurance, in accordance with Section 2.06(d)
of the Credit Agreement. At all times during which an Event of Default shall
have occurred and be continuing, Beneficiary shall be entitled to receive direct
and immediate payment of the proceeds of such condemnation and Grantor shall
take all action as the Beneficiary may reasonably request to accomplish such
payment, and in the event Grantor shall receive any such proceeds during the
occurrence and continuance of an Event of Default, Grantor shall immediately
deliver the proceeds to Beneficiary for the benefit of the Secured Creditors and
pending such delivery shall hold such proceeds in trust for the benefit of the
Secured Creditors and keep the same segregated from its other funds.
ARTICLE VIII
SECURITY AGREEMENT AND ASSIGNMENT OF LEASES AND RENTS
8.1 ASSIGNMENT: Subject to the terms and conditions hereinafter set
forth, Grantor as debtor does hereby irrevocably transfer, assign and deliver
unto Beneficiary as secured party for its benefit and the ratable benefit of the
Secured Creditors, as security for the payment and performance of the
Obligations, and grant a security interest in, all of the right, title and
interest of Grantor in and to all of the following (collectively, the
"Collateral"):
(a) The Encumbered Leases and the Election;
(b) The Leases;
(c) The Rents;
(d) The Fixtures; and
(e) The Personalty.
This assignment of rentals and any other assignments required by the
provisions hereof shall terminate and become null and void upon release of this
Mortgage.
The Grantor shall execute and deliver to Beneficiary, in form and
substance satisfactory to Beneficiary, such financing statements and such
further assurances as required by applicable law or as Beneficiary may, from
time to time, consider reasonably necessary to create, perfect and preserve
Beneficiary's security interest herein granted, and Grantor will (or Beneficiary
at its
32
option may) cause such statements and assurances to be recorded and filed at
such times and places as may be required or permitted by law to so create,
perfect and preserve such security interest. Grantor authorizes Beneficiary to
file one or more financing statements, without the signature of Grantor,
covering the Collateral.
Beneficiary shall have, and Grantor grants to Beneficiary, all the rights,
remedies and recourses with respect to the Personalty, Fixtures, Leases and
Rents afforded a secured party by the aforesaid UCC in addition to, and not in
limitation of, the other rights, remedies and recourses afforded by the Loan
Documents and at law.
This Mortgage shall be effective as a Financing Statement filed as a
fixture filing from the date of its filing for record covering the Fixtures and
Personalty and is to be filed for record in the real estate records of each
county where any part of the Mortgaged Property (including Fixtures) is
situated. The record owner of the real property described in Exhibit A is
Grantor. The addresses of Grantor, as Debtor, and Beneficiary, as Secured Party,
are as set forth herein. The above described goods are or are to become fixtures
related to the Land and Improvements of which the Grantor is record title owner
or lessee. This Mortgage shall also be effective as a financing statement
covering the Collateral and may be filed in any other appropriate filing or
recording office.
This instrument covers goods that are or are to become fixtures on the
Land described herein. This instrument shall be deemed to be a fixture filing
and financing statement and for such purpose the following information is set
forth:
(1) Name and Address of Debtor: as set forth on page 2 hereof.
(2) Name and Address of Secured Party: as set forth on page 2
hereof.
(3) The mailing address of the Grantor/Debtor is the address of
Grantor set forth on page 2 hereof.
(4) The address of the Beneficiary/Secured Party from which
information concerning the security interest hereunder is set
forth on page 2 hereof.
(5) Description of the types (or items) of property covered by
this financing statement: as set forth in Section 1.1 and this
Section 8.1.
(6) Description of real estate to which collateral is attached or
upon which it is located: as set forth on Exhibit "A".
(7) A carbon, photographic or other reproduction of this Mortgage
or of any financing statement relating to this Mortgage shall
be sufficient as a financing statement for any of the purposes
referred to herein. Grantor is an organization that is a
corporation organized under the laws of the State of Ohio.
Grantor's organization identification number is 3817.
8.2 COLLECTION OF RENTS: Grantor absolutely and irrevocably assigns to
Beneficiary, with or without taking possession of the Land or the Buildings, the
Rents, and hereby authorizes
33
and empowers Beneficiary to collect the Rents as the same shall become due, and
does hereby irrevocably direct each and all of the lessees, sublessees,
licensees, or other occupants of the Mortgaged Property to pay to Beneficiary,
upon demand by Beneficiary, the Rents. The foregoing assignment shall not impose
upon Beneficiary any duty to produce Rents from the Mortgaged Property, and
shall not cause Beneficiary to be a "mortgagee-in-possession" for any purpose.
8.3 BENEFICIARY'S POWERS OF ATTORNEY: Grantor does hereby irrevocably
constitute and appoint Beneficiary, while this Mortgage remains in force and
effect, its true and lawful attorney-in-fact, coupled with an interest and with
full power of substitution, delegation and revocation, for Grantor and in its
name, place and stead, to enter and take possession of the Mortgaged Property
after an Event of Default by actual physical possession without the commencement
of any action to foreclose this Mortgage or to exercise any power of sale
Beneficiary may have hereunder and to do and perform any or all of the following
actions, as fully as Grantor could do if personally present, hereby ratifying
and confirming all that Beneficiary, as attorney or its substitute, shall
lawfully do or cause to be done by virtue hereof:
(a) to enter into subordination and non-disturbance agreements
with respect to any Leases or with any of the tenants or lessees under any
of the Leases;
(b) to demand, collect, sue for, attach, levy, recover, receive,
compromise and adjust, and make, execute and deliver receipts, releases,
discharges or other instruments for all Rents, issues, and other amounts
that may hereafter become due, owing or payable with respect to the
Mortgaged Property or any part thereof from any present or future tenants,
lessees, sublessees, licensees or other occupants thereof;
(c) to institute, prosecute to completion, or compromise and
settle, all summary proceedings, actions for rent or for removing any and
all tenants, lessees, sublessees, licensees or other occupants of the
Mortgaged Property or any part or parts thereof;
(d) to enforce or enjoin or restrain the violation of any of the
terms, provisions and conditions of any of the Leases;
(e) to pay, from and out of any Rents and issues collected in
respect of the Mortgaged Property or any part thereof, or from or out of
any other funds, any taxes, assessments, water rates, sewer rates, or
other government charges levied, assessed, or imposed against the
Mortgaged Property, or any portion thereof, and also any and all other
charges, costs and expenses which it may be reasonably necessary or
advisable for Beneficiary to pay in the management or operation of the
Mortgaged Property, including commissions for renting the Mortgaged
Property or any portion thereof, management and consulting fees, and legal
expenses incurred in enforcing claims, drafting and negotiating documents
or for any other services that may be required;
(f) to ask, demand, collect, sue for, recover, compromise, receive
and give acquittance and receipts for moneys due and to become due under
or in respect of any of the Personalty;
34
(g) to receive, indorse, and collect any drafts or other
instruments, documents and chattel paper, in connection with subsection
(f) above;
(h) to file any claims or take any action or institute any
proceedings which the Beneficiary may deem necessary or desirable for the
collection of any of the Personalty or otherwise to enforce the rights of
the Beneficiary with respect to any of the Personalty, including without
limitation the execution, delivery and filing of financing statements,
continuation statements, affidavits or other security instruments and
agreements necessary to perfect, confirm and continue in effect the lien
of this Mortgage with respect to the Leases, the Rents, the Fixtures and
the Personalty; and
(i) to generally do, execute, and perform any other act, deed,
matter or thing whatsoever that ought to be done, executed and performed
in and about or with respect to the Mortgaged Property, the Leases and the
Personalty, as fully as Grantor might do; provided, however, that this
Assignment shall not operate to place upon Beneficiary any responsibility
or obligation to take any of the above actions or any action whatsoever
with respect to the operation, control, care, management or repair of the
Mortgaged Property, and that any action taken or failure or refusal to act
by Beneficiary under this Mortgage shall be at Beneficiary's election and
without any liability on its part.
8.4 GRANTOR REMAINS LIABLE: Anything herein to the contrary
notwithstanding:
(a) Grantor shall remain liable under the Leases to the extent set
forth therein to perform all of its duties and obligations thereunder to
the same extent as if this Mortgage had not been executed;
(b) the exercise by the Beneficiary of any of the rights hereunder
shall not release the Grantor from any of its duties or obligations under
any of the Leases; and
(c) the Beneficiary shall not have any obligation or liability
under any of the Leases to any person or entity under this Mortgage nor
shall the Beneficiary be obligated to perform any of the obligations or
duties of the Grantor thereunder or to take any action to collect or
enforce any claims thereunder.
8.5 GRANTOR'S REPRESENTATIONS AND WARRANTIES: Grantor represents and
warrants that:
(a) No Rents, nor any part thereof becoming due subsequent to the
date hereof, have been collected with respect to the Leases (excepting an
amount not exceeding one month's installment under the Leases), nor has
payment of any of the same been anticipated, waived, released, discounted
or otherwise discharged or compromised;
(b) This Mortgage creates a valid security interest in the
Personalty as security for the payment and performance of the Obligations.
Upon the filing of financing statements (the "Financing Statement") under
the UCC naming the Grantor as debtor and the Beneficiary as secured party
and covering the Personalty, such security interests shall be perfected
under the UCC and such security interests are not subject to any prior
lien,
35
or to any agreement purporting to grant to any Person, other than the
Beneficiary, a security interest in any of the Personalty, in each case
other than with respect to the Permitted Encumbrances. No further filings,
recordings or other actions are necessary to perfect or maintain the
priority of such security interests other than the filing of UCC
continuation statements on or prior to the date required by applicable
Legal Requirements. The Financing Statements are in appropriate form and
have been duly filed pursuant to the UCC;
(c) The chief place of business and chief executive office of the
Grantor are located at the address first specified above for the Grantor;
(d) Each of the Leases, as amended to the date of execution and
delivery hereof has been duly authorized, executed and delivered by
Grantor (and to Grantor's knowledge all other parties thereto) and is in
full force and effect and binding upon and enforceable against Grantor
and, to Grantor's knowledge, against the other parties thereto, in
accordance with its terms. No event has occurred and is continuing, or
will occur as a result of the performance of this Mortgage, that
constitutes or would constitute any material event of default under any of
the Leases or would constitute such an event of default but for the
requirement that notice be given or time lapse or both.
8.6 GRANTOR'S COVENANTS: Grantor covenants and agrees with respect to
the Leases that:
(a) It will perform and observe each of its material obligations
under the terms of the Leases now or hereafter in effect (except when the
amount or validity of such obligations is being contested in good faith)
and use commercially reasonable efforts to cause the other parties thereto
to comply with their obligations thereunder;
(b) It will, upon the reasonable written request by Beneficiary,
while this Assignment remains in force and effect, serve written notices
of this Assignment upon any lessor or lessee, sublessee, licensee, or
other occupant of any portion of the Mortgaged Property or include among
the written provisions of any instrument hereafter creating any such
lease, sublease, license, or right of occupancy specific reference to this
Assignment, and make, execute and deliver all such powers of attorney or
instrument of pledge or assignment, and such other instrument or documents
as Beneficiary may reasonably request at any time for the purpose of
securing its rights hereunder;
(c) It will furnish to Beneficiary, promptly following demand,
true copies of all Leases hereafter executed and true copies of each
agreement or letter effecting the renewal, amendment or modification of
any Lease; and in each case after request by the Beneficiary, furnish to
the Beneficiary promptly following receipt thereof copies of all notices,
requests and other documents received by the Grantor under or pursuant to
the Leases during the term of each of the Leases and from time to time (A)
furnish to Beneficiary such information and reports regarding the Leases
as the Beneficiary may reasonably request, and (B) promptly following
request of the Beneficiary make such demands and requests for information
or action upon such person, firm, corporation, or other entity as the
Grantor is entitled to make under the Leases;
36
(d) It will cause the security interest in the Personalty to
remain a continuously perfected, first priority security interest free and
clear of any liens (other than the Beneficiary's lien hereunder and the
Permitted Encumbrances), and from time to time, at its own expense, the
Grantor will promptly execute and deliver all further instruments and
documents and take all further action, that may be necessary or desirable,
or that the Beneficiary may reasonably request, in order to perfect and
protect any security interest granted or purported to be granted hereby or
to enable the Beneficiary to otherwise enforce its rights and remedies
hereunder with respect to the Personalty. Without limiting the generality
of the foregoing or of Section 4.3 hereof, the Grantor will: (i) at the
request of the Beneficiary, mark conspicuously any item of chattel paper
relating to or evidencing the Personalty with a legend, in form and
substance satisfactory to the Beneficiary, indicating that the Personalty
is subject to the security interest granted hereby, (ii) execute and file
such financing or continuation statements, or amendments thereto, and such
other collateral assignments, security agreements, instruments or notices,
as may be necessary or desirable, or as the Beneficiary may reasonably
request, in order to perfect and preserve the security interests granted
or purported to be granted hereby, and (iii) defend the title to the
Personalty and the Beneficiary's lien thereon and security interest
therein against the claim of any person, firm, corporation, or other
entity claiming against or through Grantor and will maintain and preserve
such lien and security interest so long as this Mortgage shall remain in
effect;
(e) It authorizes the Beneficiary to file one or more financing or
continuation statements, and amendments thereto, relative to all or any
part of the Personalty without the signature of the Grantor where
permitted by law; and
(f) It will furnish to the Beneficiary from time to time
statements and schedules further identifying and describing the Personalty
and such other reports in connection with the Personalty as the
Beneficiary may reasonably request, all in reasonable detail.
8.7 EFFECT OF RELEASE OF MORTGAGED PROPERTY: The Grantor hereby consents
to, and hereby agrees that the rights of the Beneficiary and the security
interests hereunder, and the obligations of the Grantor hereunder, to the
fullest extent permitted by applicable Legal Requirements, shall not be affected
by any and all releases of any of the Mortgaged Property from the liens or
security interests created by this Mortgage or otherwise, whether for purposes
of sales or other dispositions of assets or for some other purpose, except to
the extent expressly provided herein, by any agreement extending the time or
otherwise altering the terms of payment of all or any part of the indebtedness
secured hereby, or subordinating, modifying or waiving any obligation, or
subordinating, modifying or otherwise dealing with the lien or charge hereof,
each such agreement to be in writing to be binding and effective, by exercising
or refraining from exercising or waiving any right Beneficiary may have
hereunder, or by accepting additional security of any kind or additional parties
to the Obligations secured hereby or instruments creating or evidencing such.
8.8 HOLD HARMLESS: WITHOUT LIMITATION OF THE INDEMNITY SET FORTH IN
SECTION 10.15, GRANTOR HEREBY AGREES TO INDEMNIFY AND HOLD THE BENEFICIARY AND
THE SECURED CREDITORS HARMLESS (A)
37
AGAINST AND FROM ANY AND ALL LIABILITY, LOSS, DAMAGE AND EXPENSE, INCLUDING
REASONABLE ATTORNEYS' FEES, WHICH IT MAY OR SHALL INCUR UNDER OR IN CONNECTION
WITH THE EXERCISE BY BENEFICIARY OF ITS RIGHTS HEREUNDER IN RESPECT OF ANY OF
THE LEASES, OR BY REASON OF ANY ACTION TAKEN OR EXPENSES PAID OR INCURRED BY
BENEFICIARY UNDER AND IN ACCORDANCE WITH THE TERMS OF THIS MORTGAGE, AND (B)
AGAINST AND FROM ANY AND ALL CLAIMS AND DEMANDS WHATSOEVER WHICH MAY BE ASSERTED
AGAINST GRANTOR BY REASON OF ANY ALLEGED OBLIGATIONS OR UNDERTAKING ON ITS PART
TO PERFORM OR DISCHARGE ANY OF THE TERMS, COVENANTS AND CONDITIONS CONTAINED IN
ANY OF THE LEASES; PROVIDED THAT SUCH INDEMNITY SHALL NOT, AS TO ANY INDEMNIFIED
PARTY, BE AVAILABLE TO THE EXTENT THAT SUCH LIABILITIES, OBLIGATIONS, LOSSES,
DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES OR DISBURSEMENTS
ARE DETERMINED BY A COURT OF COMPETENT JURISDICTION BY FINAL AND NON-APPEALABLE
JUDGMENT TO HAVE RESULTED PRIMARILY FROM THE GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF SUCH INDEMNIFIED PARTY. SHOULD BENEFICIARY PAY OR INCUR ANY SUCH
LIABILITY, LOSS, DAMAGE OR EXPENSE, THE AMOUNT THEREOF, TOGETHER WITH INTEREST
THEREON FROM THE DATE OF SUCH PAYMENT AT THE DEFAULT RATE, SHALL BE PAYABLE BY
GRANTOR TO BENEFICIARY IMMEDIATELY UPON DEMAND THEREFOR; AND UNTIL SO PAID BY
GRANTOR, ALL SUMS SO EXPENDED BY BENEFICIARY, AND INTEREST THEREON, SHALL BE
ADDED TO THE OBLIGATIONS AND SECURED BY THE LIEN AND LEGAL OPERATION AND EFFECT
OF THIS MORTGAGE. AT ITS OPTION, BENEFICIARY MAY REIMBURSE ITSELF THEREFOR OUT
OF ANY RENTS WHICH IT HAS COLLECTED OR MAY COLLECT.
ARTICLE IX
INDIVIDUAL BENEFICIARY
9.1 INDIVIDUAL BENEFICIARY:
(a) Individual Beneficiary has been designated as co-Beneficiary
hereunder so that if the State is a state in which, under any present or
future law, Beneficiary may be deemed to be incompetent or unqualified to
enforce its rights for itself and as agent for the Secured Creditors
because it is deemed to be acting as trustee for the Secured Creditors
under State law, then all the acts required to be performed in such
jurisdiction, in the enforcement of Beneficiary's rights hereunder, shall
and will be performed by Individual Beneficiary, acting alone. Therefore,
notwithstanding any other term or provision hereof or in any Loan Document
to the contrary, Beneficiary alone shall have and exercise the rights and
powers granted herein and in each of the Loan Documents and shall be
charged with the performance of the duties herein and therein declared on
the part of Beneficiary to be had and exercised or to be performed;
provided, however, that if Beneficiary deems it necessary or desirable for
Individual Beneficiary to act in a State, Individual Beneficiary shall
have and exercise the rights and powers granted herein and
38
therein and shall be charged with the performance of the duties herein and
therein declared on the part of Beneficiary to be had and exercised or to
be performed, but only in such particular jurisdiction. The foregoing
shall not relieve Beneficiary from any liability or obligation of
Beneficiary to any party under the Loan Documents.
(b) Individual Beneficiary may execute and deliver, on behalf of
Beneficiary, any writing, document or instrument which Beneficiary directs
Individual Beneficiary to execute and deliver, including, without
limitation, any writing, document or instrument of a purely ministerial
nature.
(c) No action taken under this Section shall release Beneficiary
from its obligations hereunder or under the Loan Documents.
(d) The authority granted Individual Beneficiary hereby shall not
give Individual Beneficiary any rights under any of the Loan Documents,
except as expressly set forth in this Section 9.1.
ARTICLE X
MISCELLANEOUS
10.1 PERFORMANCE AT GRANTOR'S EXPENSE: The cost and expense of performing
or complying with any and all of the Obligations shall be borne solely by
Grantor, and no portion of such cost and expense shall be, in any way or to any
extent, credited against any installment on or portion of the Secured
Indebtedness which may be payable by Grantor pursuant to the Loan Documents.
10.2 SURVIVAL OF OBLIGATIONS: Each and all of the Obligations shall
survive the execution and delivery of the Loan Documents and the consummation of
the loans called for therein and shall continue in full force and effect with
respect to Grantor until the Obligations shall have been paid, performed and
satisfied in full, and all of the Commitments have been terminated and all of
the Letters of Credit shall have been canceled and returned to the L/C Issuer
and the Facility Termination Date shall have occurred.
10.3 FURTHER ASSURANCES: Grantor, upon the request of Beneficiary, will
execute, acknowledge, and record and/or file such further instruments and do
such further acts as may be reasonably necessary, desirable or proper to carry
out more effectively the purpose of the Loan Documents and to subject to the
liens and security interests thereof any property intended by the terms thereof
to be covered thereby, including specifically but without limitation, any
renewals, additions, substitutions, replacements, betterments or appurtenances
to the then Mortgaged Property.
10.4 RECORDING AND FILING: Grantor will cause this Mortgage and all
amendments and supplements thereto and supplements therefor to be recorded,
filed, re-recorded and refiled in such manner and in such places as required by
applicable law or as Beneficiary shall reasonably request, and will pay all such
recording, filing, re-recording and refiling taxes, fees and other charges.
39
10.5 NOTICES: Any notice shall be conclusively deemed to have been
received by any party hereto and be effective (i) on the day delivered by hand
or by commercial courier service to such party (against receipt therefor)
(provided that if such day is not a Business Day, such date of delivery or
receipt shall be deemed to be the next following Business Day), (ii) on the day
of receipt (provided that if such day is not a Business Day, such date of
delivery or receipt shall be deemed to be the next following Business Day) by
telefacsimile (where the receipt of such message is verified by telephone), or
(iii) on the fifth Business Day after the day on which mailed, if sent prepaid
by certified or registered mail, return receipt requested, in each case
delivered, transmitted or mailed, as the case may be, to the address or
telefacsimile number, as appropriate, set forth below or such other address or
number as such party shall specify by notice hereunder:
(a) if to the Grantor:
Block Communications, Inc.
541 N. Superior Street
Toledo, Ohio 43660
Attention: Gary Blair
Telephone: (419)-724-6256
Telefacsimile: (419)-723-6167
with a copy to:
Fritz Byers, Esq.
824 Spitzer Building
Toledo, Ohio 43604
Telephone: (419) 241-8013
Telefacsimile: (419) 241-4215
(b) if to the Beneficiary:
Bank of America, N.A.
901 Main Street, 14th Floor
TX1-492-14-11
Dallas, Texas 75202
Attention: Agency Management
Telephone: (214) 209-4128
Telefacsimile: (214) 290-9544
40
with a copy to:
Bank of America, N.A.
901 Main Street, 14th Floor
TX1-492-14-12
Dallas, Texas 75202
Attention: Michelle Diggs
Telephone: 214-209-1219
Telefacsimile: 214-209-8365
and to:
Helms Mulliss & Wicker, PLLC
201 North Tryon Street
Charlotte, North Carolina 28202
Attention: Kent Walker, Esq.
Telephone: (704) 343-2000
Telefacsimile: (704) 334-8467
10.6 NO WAIVER; REMEDIES: The Beneficiary's failure, at any time or times
hereafter, to require strict performance by the Grantor of any provision of this
Mortgage shall not waive, affect or diminish any right of the Beneficiary
thereafter to demand strict compliance and performance therewith, and the
Beneficiary's single or partial exercise of any right, remedy, power or
privilege hereunder shall not preclude any other or further exercise thereof or
the exercise of any other right, remedy, power, or privilege. The rights,
remedies, powers or privileges herein provided are cumulative and not exclusive
of any rights, remedies, powers or privileges provided by applicable Legal
Requirements. Any suspension or waiver by the Beneficiary of a default by the
Grantor under this Mortgage or under any of the other Loan Documents shall not
suspend, waive or affect any other default thereunder, whether the same is prior
or subsequent thereto and whether of the same or of a different kind of
character. None of the undertakings, agreements, warranties, covenants and
representations of the Grantor contained in this Mortgage and no default by the
Grantor under this Mortgage shall be deemed to have been suspended or waived
unless such suspension or waiver is in writing signed by an officer of the
Beneficiary, and directed to the Grantor specifying such suspension or waiver.
10.7 BENEFICIARY'S AND SECURED CREDITORS' RIGHT TO PERFORM THE
OBLIGATIONS:
(a) If Grantor shall fail, refuse or neglect to make any payment
or perform any act required of it by this Mortgage (including the
Grantor's obligation under Section 4.3 hereof to defend the first lien
status of this Mortgage), then at any time thereafter, upon reasonable
notice to Grantor and without waiving or releasing any other right, remedy
or recourse Beneficiary may have because of same, Beneficiary may (but
shall not be obligated to) make such payment or perform such act for the
account of and at the expense of Grantor, and shall have the right to
enter upon or in the Land and Buildings for such purpose and to take all
such action thereon and with respect to the Mortgaged Property as it may
deem reasonably necessary or appropriate. In its exercise of its rights
under this Section 10.7, if Beneficiary shall elect to pay any Imposition
or other sums due
41
with reference to the Mortgaged Property, Beneficiary may do so in
reasonable reliance on any bill, statement or assessment procured from the
appropriate governmental authority or other issuer thereof without
inquiring into the accuracy or validity thereof subject to any other
applicable terms and provisions set forth herein. Similarly, in making any
payments to protect the security intended to be created by the Loan
Documents, Beneficiary shall not be bound to inquire into the validity of
any apparent or threatened adverse title, lien, encumbrance, claim or
charge before making an advance for the purpose of preventing or removing
the same subject to any other applicable terms and provisions set forth
herein. GRANTOR SHALL INDEMNIFY BENEFICIARY FOR ALL LOSSES, EXPENSES,
DAMAGE, CLAIMS AND CAUSES OF ACTION, INCLUDING REASONABLE ATTORNEY'S FEES,
INCURRED OR ACCRUING BY REASON OF ANY ACTS PERFORMED BY BENEFICIARY
PURSUANT TO THE PROVISIONS OF THIS SECTION 10.7; PROVIDED THAT SUCH
INDEMNITY SHALL NOT, AS TO ANY INDEMNIFIED PARTY, BE AVAILABLE TO THE
EXTENT THAT SUCH LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES,
ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES OR DISBURSEMENTS ARE DETERMINED
BY A COURT OF COMPETENT JURISDICTION BY FINAL AND NON-APPEALABLE JUDGMENT
TO HAVE RESULTED PRIMARILY FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT
OF SUCH INDEMNIFIED PARTY. ALL SUMS PAID BY BENEFICIARY PURSUANT TO THIS
SECTION 10.7 AND ALL OTHER SUMS EXPENDED BY BENEFICIARY TO WHICH IT SHALL
BE ENTITLED TO BE INDEMNIFIED, TOGETHER WITH INTEREST THEREON AT THE
DEFAULT RATE FROM THE DATE OF SUCH PAYMENT OR EXPENDITURE, SHALL
CONSTITUTE ADDITIONS TO THE OBLIGATIONS, AND SHALL BE SECURED BY THE LOAN
DOCUMENTS AND GRANTOR COVENANTS AND AGREES TO PAY THEM TO THE ORDER OF
BENEFICIARY UPON DEMAND.
(b) Any reference in this Mortgage to amounts advanced by or owed
to Beneficiary shall be deemed to refer equally to amounts advanced by or
owed to the Secured Creditors, and wherever Beneficiary is required or
permitted to advance funds, such funds may be advanced by the Secured
Creditors with the same effect as if advanced by Beneficiary.
10.8 COVENANTS RUNNING WITH THE LAND: All Obligations are intended by the
parties to be, and shall be construed as, covenants running with the Mortgaged
Property until such Mortgaged Property has been released from the lien of this
Mortgage.
10.9 SUCCESSORS AND ASSIGNS: All of the terms of this Mortgage shall
apply to, be binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns.
10.10 SEVERABILITY: This Mortgage is intended to be performed in
accordance with, and only to the extent permitted by, applicable Legal
Requirements. If any provision of this Mortgage or the application thereof to
any person or circumstance shall, for any reasons and to any extent, be invalid
or unenforceable, then neither the remainder of this Mortgage nor the
42
application of such provision to other persons or circumstances nor the other
instruments referred to above shall be affected thereby, but rather shall be
enforced to the greatest extent permitted by applicable law.
10.11 ENTIRE AGREEMENT AND MODIFICATION: The Loan Documents contain the
entire agreement between the parties relating to the subject matter hereof and
thereof and all prior agreements relative thereto which are not contained herein
or therein are terminated. This Mortgage may not be amended, revised, waived,
discharged, released or terminated orally but only by a written instrument or
instruments executed by the party against which enforcement of the amendment,
revision, waiver, discharge, release or termination is asserted. Any alleged
amendment, revision, waiver, discharge, release or termination which is not so
documented shall not be effective as to any party. In the event of a conflict
between the covenants contained herein and the covenants contained in the Credit
Agreement, the more specific covenants contained herein shall govern with
respect to the Mortgaged Property.
10.12 APPLICABLE LAW: THE PARTIES TO THIS MORTGAGE AGREE THAT THEIR RIGHTS
AND OBLIGATIONS UNDER THIS MORTGAGE SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF NEW YORK, WITHOUT GIVING EFFECT TO
THE CONFLICTS-OF LAW RULES AND PRINCIPLES THEREOF. THE PARTIES FURTHER AGREE
THAT NEW YORK HAS A SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE
UNDERLYING TRANSACTIONS SECURED BY THIS MORTGAGE. NOTWITHSTANDING THE FOREGOING,
THE PARTIES AGREE THAT:
(A) THE PROCEDURES GOVERNING THE ENFORCEMENT BY BENEFICIARY OF THE
PROVISIONAL REMEDIES AGAINST GRANTOR, INCLUDING BY WAY OF ILLUSTRATION BUT
NOT LIMITATION, ACTIONS FOR REPLEVIN, FOR CLAIM AND DELIVERY OF PROPERTY,
FOR INJUNCTIVE RELIEF OR FOR THE APPOINTMENT OF A RECEIVER AND THE
REQUIREMENTS NECESSARY TO CREATE OR GRANT, PERFECT OR FORECLOSE ON, OR
DETERMINE THE PRIORITY OF, THE LIEN AND SECURITY INTEREST OF THIS
MORTGAGE, SHALL BE GOVERNED BY THE LAWS OF THE STATE IN WHICH THE
MORTGAGED PROPERTY IS LOCATED;
(B) OTHER THAN AS SET FORTH IN SUBSECTION (A) ABOVE, BENEFICIARY
SHALL COMPLY WITH THE APPLICABLE LAW OF THE STATE, TO THE EXTENT REQUIRED
IN CONNECTION WITH THE POWER OF SALE OR THE FORECLOSURE OF THE SECURITY
INTERESTS AND LIENS CREATED HEREBY PROVIDED, HOWEVER, THAT THIS SUBSECTION
SHALL IN NO EVENT BE CONSTRUED TO PROVIDE THAT THE SUBSTANTIVE LAW OF SUCH
STATE SHALL APPLY TO THE OBLIGATIONS SECURED BY THIS MORTGAGE WHICH ARE
AND SHALL CONTINUE TO BE GOVERNED BY THE SUBSTANTIVE LAW OF NEW YORK. THE
PARTIES FURTHER AGREE THAT BENEFICIARY MAY ENFORCE ITS RIGHTS UNDER THIS
MORTGAGE AND THE LOAN DOCUMENTS, INCLUDING BUT NOT LIMITED TO, ITS RIGHT
TO SUE GRANTOR, TO COLLECT ANY OUTSTANDING INDEBTEDNESS OR TO OBTAIN A
JUDGMENT FOR ANY DEFICIENCY FOLLOWING FORECLOSURE,
43
IN ACCORDANCE WITH THE LAWS OF NEW YORK. NOTHING IN THE FOREGOING SHALL BE
CONSTRUED TO PROVIDE THAT THE SUBSTANTIVE LAW OF THE STATE SHALL APPLY TO
THE OBLIGATIONS SECURED BY OR EVIDENCED BY THIS MORTGAGE AND THE LOAN
DOCUMENTS;
(C) GRANTOR HEREBY ACKNOWLEDGES, WARRANTS AND REPRESENTS THAT IT
IS SOPHISTICATED, KNOWLEDGEABLE AND EXPERIENCED IN COMMERCIAL TRANSACTIONS
SIMILAR TO THE TRANSACTION EMBODIED IN THIS MORTGAGE AND THE LOAN
DOCUMENTS; IT HAS BEEN FULLY, COMPLETELY AND ADEQUATELY REPRESENTED AND
ADVISED BY COMPETENT COUNSEL AND OTHER CONSULTANTS RETAINED FOR SUCH
PURPOSES IN CONNECTION WITH ALL ASPECTS (INCLUDING BUSINESS AND LEGAL) OF
THE TRANSACTIONS UNDER THIS MORTGAGE AND THE LOAN DOCUMENTS; ALL PARTIES
TO SUCH TRANSACTION HAVE EQUAL BARGAINING STRENGTH; AND, BASED ON THE
FOREGOING, THE PARTIES HAVE SELECTED THE LAW OF THE STATE OF NEW YORK TO
GOVERN THIS MORTGAGE AND THE LOAN DOCUMENTS AS HEREIN SPECIFIED; AND
(D) TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE TERMS AND
CONDITIONS IMPLIED IN MORTGAGES BY VIRTUE OF ANY PRESENT OR FUTURE STATUTE
IN FORCE IN NEW YORK SHALL FOR THE PURPOSES OF THIS MORTGAGE BE NEGATED OR
VARIED ONLY SO FAR AS THEY ARE INCONSISTENT WITH THE TERMS AND CONDITIONS
HEREOF AND ARE OTHERWISE HEREBY VARIED SO AS TO BECOME CONSISTENT WITH
THIS MORTGAGE.
10.13 NO PARTNERSHIP; CONTROL IN GRANTOR: Except to the extent occurring
as a matter of law (a) nothing contained in this Mortgage is intended to, or
shall be construed as, creating to any extent and in any manner whatsoever, any
partnership, joint venture, or association between Grantor and Beneficiary, or
in any way make Beneficiary co-principals with Grantor with reference to all or
any portion of the Mortgaged Property, and any inferences to the contrary are
hereby expressly negated; (b) notwithstanding anything contained herein which
may be to the contrary, this Mortgage, the Loan Documents, any agreement, deed
of trust or other document referred to herein by reference, whether specifically
or generally, and the transactions contemplated hereby do not and will not
constitute or create indirect, actual or practical ownership of the Mortgaged
Property or Grantor by Beneficiary, or control, affirmative or negative, direct
or indirect, by Beneficiary over the programming, management, or any other
aspect of the day-to-day operation of the Mortgaged Property or Grantor, which
control remains in Grantor, its shareholders and board of directors; and (c)
Beneficiary's activities in connection with this Mortgage and the Loan Documents
shall not be "outside the scope of the activities of a lender of money" within
the meaning of any applicable statutes, as amended or recodified from time to
time, and Beneficiary does not intend to ever assume any responsibility to any
person for the quality, suitability, safety or condition of the Mortgaged
Property. Beneficiary shall not be directly or indirectly liable or responsible
for any loss, claim, cause of action, liability, indebtedness, damage or injury
of any kind or character to any person or property arising from any
construction, or occupancy or use of, any of the Mortgaged Property, whether
caused by or
44
arising from: (i) any defect in any building, structure, grading, fill,
landscaping or other improvements-thereon or in any on-site or off-site
improvement or other facility therein or thereon; (ii) any act or omission of
Grantor or any of its agents, employees, independent contractors, licensees or
invitees; (iii) any accident in or on any of the Mortgaged Property or any fire,
flood or other casualty or hazard thereon; (iv) the failure of Grantor, any of
its licensees, employees, invitees, agents, independent contractors or other
representatives to maintain the Mortgaged Property in a safe condition; and (v)
any nuisance made or suffered on any part of the Mortgaged Property.
10.14 HEADINGS: The Article, Section and Subsection titles hereof are
inserted for convenience of reference only and shall in no way alter, modify or
define, or be used in construing, the text of such Articles, Sections or
Subsections.
10.15 HOLD HARMLESS: NEITHER BENEFICIARY NOR SECURED CREDITORS SHALL BE
OBLIGATED TO PERFORM OR DISCHARGE, NOR DO ANY OF THEM HEREBY UNDERTAKE TO
PERFORM OR DISCHARGE, ANY OBLIGATION, DUTY OR LIABILITY WITH RESPECT TO THE
MORTGAGED PROPERTY UNDER OR BY REASON OF THIS MORTGAGE OR ANY OF THE LOAN
DOCUMENTS, AND GRANTOR SHALL AND DOES HEREBY AGREE TO INDEMNIFY BENEFICIARY AND
EACH SECURED CREDITOR FOR AND TO HOLD BENEFICIARY AND EACH SECURED CREDITOR
HARMLESS FROM ANY AND ALL LIABILITY, LOSS OR DAMAGE WHICH THEY MAY OR MIGHT
INCUR WITH RESPECT TO THE MORTGAGED PROPERTY OR UNDER OR BY REASON OF THIS
MORTGAGE OR ANY OF THE LOAN DOCUMENTS AND FROM ANY AND ALL CLAIMS AND DEMANDS
WHATSOEVER WHICH MAY BE ASSERTED AGAINST THEM BY REASON OF ANY ALLEGED
OBLIGATIONS OR UNDERTAKINGS ON THEIR PART TO PERFORM OR DISCHARGE ANY OF THE
TERMS, COVENANTS, OR AGREEMENTS RELATING TO THE MORTGAGED PROPERTY; PROVIDED
THAT SUCH INDEMNITY SHALL NOT, AS TO ANY INDEMNIFIED PARTY, BE AVAILABLE TO THE
EXTENT THAT SUCH LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS,
JUDGMENTS, SUITS, COSTS, EXPENSES OR DISBURSEMENTS ARE DETERMINED BY A COURT OF
COMPETENT JURISDICTION BY FINAL AND NON-APPEALABLE JUDGMENT TO HAVE RESULTED
PRIMARILY FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNIFIED
PARTY. SHOULD BENEFICIARY OR ANY SECURED CREDITOR INCUR ANY SUCH LIABILITY, LOSS
OR DAMAGE, THE AMOUNT THEREOF, INCLUDING ALL REASONABLE ATTORNEYS' FEES AND
COSTS AND EXPENSES ASSOCIATED WITH ACTIONS TAKEN BY BENEFICIARY OR ANY SUCH
SECURED CREDITOR IN DEFENSE THEREOF, OR OTHERWISE IN PROTECTING THEIR INTERESTS
HEREUNDER, SHALL BE SECURED HEREBY, AND GRANTOR COVENANTS AND AGREES TO
REIMBURSE BENEFICIARY OR ANY SUCH SECURED CREDITOR THEREFOR IMMEDIATELY UPON
DEMAND.
10.16 PRONOUNS AND PLURALS: All pronouns used herein shall be deemed to
refer to the masculine, feminine, neuter, singular or plural as the context may
require, and the singular form of nouns, pronouns and verbs shall include the
plural, and vice versa, whichever the context may require.
45
10.17 WAIVER OF TRIAL BY JURY: TO THE EXTENT PERMITTED UNDER THE LAWS OF
THE STATE IN WHICH THE APPLICABLE PORTION OF THE MORTGAGED PROPERTY IS SITUATED,
GRANTOR AND THE BENEFICIARY EACH HEREBY WAIVES AND SHALL WAIVE TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS
MORTGAGE.
10.18 ASSIGNMENT: Beneficiary may assign or transfer all or any portion of
its rights under this Mortgage.
10.19 NO MERGER: So long as this Mortgage is an encumbrance upon the
Mortgaged Property, there shall be no merger of the interest of any lessor or
any lessee under any Lease or sublease.
10.20 ENFORCEABILITY OF LIEN: In the event that any part of the
Obligations cannot be lawfully secured by this Mortgage, or the lien or security
interest hereof cannot be lawfully enforced to pay any part of the Obligations,
then and in either such event, at the option of Beneficiary, all payments on the
Obligations shall be deemed to have been first applied against the unsecured
part of the Obligations.
10.21 KNOWLEDGE: Whenever referenced in this Mortgage, the "knowledge" or
"best knowledge" of Grantor shall include the knowledge of its parent
corporations, if any, and its Subsidiaries, if any.
10.22 BEST EFFORTS: Whenever referenced in this Mortgage, the term "best
efforts" shall not be interpreted as requiring the commencement of litigation or
the expenditure of unreasonable sums of money, in view of the objectives sought.
10.23 USURY SAVINGS CLAUSE: Nothing contained herein or in the Loan
Documents shall be deemed to require the payment of interest or other charges by
Grantor in excess of the amount Beneficiary and the Secured Creditors may
lawfully charge under the applicable usury laws (the "Highest Lawful Rate"). In
the event Beneficiary shall collect monies which are deemed to constitute
interest which would increase the effective interest rate to a rate in excess of
that permitted to be charged by applicable law, all such sums deemed to
constitute interest in excess of the legal rate shall, upon such determination,
at the option of Beneficiary, be returned to the Grantor or credited against the
principal balance of any Obligation secured hereby then outstanding.
10.24 PAYMENT OF PRIOR ENCUMBRANCES: If any or all of the proceeds of the
Obligations (including, without limitation the Secured Indebtedness) have been
used to extinguish, extend or renew any indebtedness heretofore existing against
the Mortgaged Property or to satisfy any indebtedness or obligation secured by a
lien or encumbrance of any kind (including liens securing the payment of any
Impositions), such proceeds have been advanced by Beneficiary at Grantor's
request, and, to the extent of such funds so used, the Obligations (including
without limitation the Secured Indebtedness) in this Mortgage shall be
subrogated to and extend to all of the rights, claims, liens, titles and
interests heretofore existing against the Mortgaged Property to secure the
indebtedness or obligation so extinguished, paid, extended or
46
renewed, and the former rights, claims, liens, title and interests, if any,
shall not be waived but rather shall be continued in full force and effect and
in favor of the Beneficiary and shall be merged with the lien and security for
the repayment of and satisfaction of the Obligations (including without
limitation the repayment of all Secured Indebtedness).
10.25 INDUSTRIAL PLANT MORTGAGE: This Mortgage is an industrial plant
mortgage within the broadest interpretation of the industrial plant mortgage
doctrine under the laws of Commonwealth of Pennsylvania.
10.26 RELEASE: Upon the Disposition (as defined in the Credit Agreement)
of any of the Mortgaged Property, so long as such Disposition is permitted under
Section 7.05 of the Credit Agreement and all conditions to such Disposition
contained therein have been satisfied:
(a) the lien and security interest of the Mortgage in such
disposed Mortgaged Property shall, subject to the provision at the end of
subsection (a), be deemed to be released without any further action on the
part of Beneficiary or Grantor, provided that in the event Grantor shall
thereafter acquire any interest in (or the power to transfer rights in)
any asset that constituted Mortgaged Property hereunder prior to its
Disposition and release from the lien and security interests hereunder,
the lien and security interest granted hereunder shall be deemed to
automatically apply and attach to such asset and it shall from such time
forward continue to constitute Mortgaged Property hereunder
notwithstanding any prior release; and
(b) the Beneficiary will, at the Grantor's expense, execute and
deliver to Grantor such documents as Grantor shall reasonably request on
reasonable advanced notice to evidence the release or reconveyance of any
of such Mortgaged Property; provided Grantor shall have delivered to
Beneficiary a written request for such release or reconveyance describing
the Mortgaged Property to be released or reconveyed, and the terms of the
Disposition thereof in reasonable detail, including the price thereof and
any expenses in connection therewith.
47
SIGNATURE PAGE - MORTGAGE
Block Communications, Inc.
Grantor hereby acknowledges that it has received a copy of this Mortgage
free of charge.
WITNESS THE EXECUTION OF THIS MORTGAGE, OPEN-END MORTGAGE, LEASEHOLD
MORTGAGE, OPEN-END LEASEHOLD MORTGAGE, SECURITY AGREEMENT, FIXTURE FILING,
ASSIGNMENT OF LEASES AND RENTS AND FINANCING STATEMENT as of the date first
above written.
SIGNED, SEALED AND DELIVERED BLOCK COMMUNICATIONS, INC.,
IN THE PRESENCE OF: an Ohio corporation
By: (SEAL)
----------------------------
Name:
- -------------------------------- --------------------------------
Print Name: Title:
--------------------- -------------------------------
Attest: (SEAL)
------------------------
Name:
- -------------------------------- --------------------------------
Print Name: Title:
--------------------- -------------------------------
(CORPORATE SEAL)
This Instrument prepared by and
when recorded mail to:
- --------------------------------
Elizabeth W. Goode, Esq.
Helms Mulliss & Wicker, PLLC
201 North Tryon Street
Charlotte, North Carolina 28202
Certificate of Residence of Beneficiary/Mortgagee
Bank of America, N.A., as Agent, the Beneficiary/Mortgagee herein
named hereby certifies that its precise mailing address is Bank of America,
N.A., 901 Main Street, 14th Floor, TX1-492-14-11, Dallas, Texas 75202,
Attention: Agency Management.
BANK OF AMERICA, N.A., AS AGENT
By:
---------------------------------
Title:
------------------------------
STATE OF __________________ )
)
COUNTY OF _________________ )
Before me, a notary public, in and for said county, personally appeared
______________ and _______________________, known to me to be the persons who as
___________________ and _______________________, respectively, of the
corporation which executed the foregoing instrument, signed the same and
acknowledged to me that they did so sign said instrument in the name and upon
behalf of said corporation as such officers, respectively, that the same is
their free act and deed as such officers, respectively, and the free and
corporate act and deed of said corporation, that they were duly authorized
thereunder by its Board of Directors and that the seal affixed to said
instrument is the corporate seal of said corporation.
IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed my
official seal at _____________________ this ____________ day of May, 2002.
______________________________
Notary Public
SEAL
My commission expires:
______________________________