Exhibit 4.21
____________________________________________________________
LEINER HEALTH PRODUCTS INC.,
Mortgagor,
to
THE BANK OF NOVA SCOTIA,
as agent,
Mortgagee
___________________________________________________
MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FIXTURE FILING
___________________________________________________
Dated as of June 30, 1997
This instrument affects certain real and personal property
located in Cook County,
State of Illinois.
______________________________________________________________
Record and return to:
Mayer, Brown & Platt
1675 Broadway
New York, New York 10019
Attention: Kenneth R. Kleiner, Esq.
This instrument was prepared by the above-named attorney.
Notice: This instrument contains INTER ALIA obligations which may provide for:
(a) a variable rate of interest and/or
(b) future and/or revolving credit advances or readvances, which when
made, shall have the same priority as advances or readvances made
on the date hereof whether or not (i) any advances or readvances
were made on the date hereof and (ii) any indebtedness is
outstanding at the time any advance or re-advance is made.
Notwithstanding anything to the contrary contained herein, the maximum
principal indebtedness secured under any contingency by this
instrument shall in no event exceed $210,000,000.00.
TABLE OF CONTENTS
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ARTICLE 1.
COVENANTS AND AGREEMENTS OF THE MORTGAGOR
SECTION 1.1 Payment of Secured Obligations.............................11
SECTION 1.2 Title to Collateral, etc...................................11
SECTION 1.3 Title Insurance............................................12
SECTION 1.3.1 Title Insurance Policy.....................................12
SECTION 1.3.2 Title Insurance Proceeds...................................12
SECTION 1.4 Recordation................................................12
SECTION 1.5 Payment of Impositions, etc................................13
SECTION 1.6 Insurance and Legal Requirements...........................13
SECTION 1.7 Security Interests, etc....................................14
SECTION 1.8 Permitted Contests.........................................15
SECTION 1.9 Leases.....................................................16
SECTION 1.10 Compliance with Instruments................................16
SECTION 1.11 Maintenance and Repair, etc................................16
SECTION 1.12 Alterations, Additions, etc................................17
SECTION 1.13 Acquired Property Subject to Lien..........................17
SECTION 1.14 Assignment of Rents, Proceeds, etc.........................18
SECTION 1.15 No Claims Against the Mortgagee............................19
SECTION 1.16 Indemnification............................................19
SECTION 1.17 No Credit for Payment of Taxes.............................21
SECTION 1.18 Offering of the Notes; Application of
Proceeds of Loans..........................................21
SECTION 1.19 No Transfer of the Property................................21
SECTION 1.20 Security Agreement.........................................22
SECTION 1.21 Representations and Warranties.............................23
SECTION 1.22 Mortgagor's Covenants......................................23
ARTICLE 2.
INSURANCE; DAMAGE, DESTRUCTION OR TAKING, ETC.
SECTION 2.1 Insurance..................................................24
SECTION 2.1.1 Risks to be Insured........................................24
SECTION 2.1.2. Policy Provisions.....................................25
SECTION 2.1.3. Delivery of Policies, etc.............................26
SECTION 2.1.4. Separate Insurance....................................26
SECTION 2.1.5. Flood Insurance.......................................26
SECTION 2.2 Damage, Destruction or Taking; Mortgagor
to Give Notice; Assignment of Awards.......................27
SECTION 2.3 Application of Proceeds and Awards.........................27
SECTION 2.4 Total Taking and Total Destruction.........................30
ARTICLE 3.
EVENTS OF DEFAULT; REMEDIES, ETC.
SECTION 3.1 Events of Default; Acceleration............................31
SECTION 3.2 Legal Proceedings; Foreclosure.............................32
SECTION 3.3 Power of Sale..............................................32
SECTION 3.4 Uniform Commercial Code Remedies...........................33
SECTION 3.5 Mortgagee Authorized to Execute Deeds, etc.................34
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TABLE OF CONTENTS
(continued)
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SECTION 3.6 Purchase of Collateral by Mortgagee........................34
SECTION 3.7 Receipt a Sufficient Discharge to Purchaser................34
SECTION 3.8 Waiver of Appraisement, Valuation, etc.....................35
SECTION 3.9 Sale a Bar Against Mortgagor...............................35
SECTION 3.10 Secured Obligations to Become Due on Sale..................35
SECTION 3.11 Application of Proceeds of Sale and Other Moneys...........35
SECTION 3.12 Appointment of Receiver....................................36
SECTION 3.13 Possession, Management and Income..........................37
SECTION 3.14 Right of Mortgagee to Perform Mortgagor's
Covenants, etc.............................................37
SECTION 3.15 Subrogation................................................38
SECTION 3.16 Remedies, etc., Cumulative.................................38
SECTION 3.17 Provisions Subject to Applicable Law.......................38
SECTION 3.18 No Waiver, etc.............................................39
SECTION 3.19 Compromise of Actions, etc.................................39
ARTICLE 4.
DEFINITIONS
SECTION 4.1 Terms Defined in this Mortgage.............................39
SECTION 4.2 Use of Defined Terms.......................................47
SECTION 4.3 Credit Agreement Definitions...............................47
ARTICLE 5.
MISCELLANEOUS
SECTION 5.1 Further Assurances; Financing Statements...................47
SECTION 5.1.1 Further Assurances.........................................47
SECTION 5.1.2 Financing Statements.......................................48
SECTION 5.2 Additional Security........................................48
SECTION 5.3 Defeasance; Partial Release, etc...........................48
SECTION 5.3.1 Defeasance.................................................48
SECTION 5.3.2 Partial Release, etc......................................49
SECTION 5.4 Notices, etc...............................................49
SECTION 5.5 Waivers, Amendments, etc...................................49
SECTION 5.6 Cross-References...........................................49
SECTION 5.7 Headings...................................................49
SECTION 5.8 Currency...................................................49
SECTION 5.9 Governing Law..............................................49
SECTION 5.10 Successors and Assigns, etc................................50
SECTION 5.11 Waiver of Jury Trial; Submission to Jurisdiction...........50
SECTION 5.12 Severability...............................................51
SECTION 5.13 Loan Document..............................................51
SECTION 5.14 Usury Savings Clause.......................................51
SECTION 5.15 Future Advances............................................52
EXECUTION PAGE ..........................................................40
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TABLE OF CONTENTS
(continued)
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ACKNOWLEDGMENT...........................................................41
Schedule 1 - Legal Description
Schedule 2 - Permitted Encumbrances
MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FIXTURE FILING
MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE
FILING, dated as of June 30, 1997 (this "MORTGAGE"), made by LEINER HEALTH
PRODUCTS INC. ( "LEINER" or the "MORTGAGOR"), a Delaware corporation having an
address of 901 East 233rd Street, Carson, California 90745, to THE BANK OF NOVA
SCOTIA, having an address at One Liberty Plaza, New York, New York 10006, for
itself as a Lender and as collateral agent (the "AGENT") under the Credit
Agreement referred to below (together with its successors and assigns from time
to time acting as agent under such Credit Agreement, the "MORTGAGEE").
W I T N E S S E T H T H A T:
WHEREAS, the Mortgagor is on the date of delivery hereof the owner of fee
title to the parcel of land described in SCHEDULE 1 hereto (the "LAND") and of
the Improvements (such term and other capitalized terms used in this Mortgage
having the respective meanings specified or referred to in ARTICLE IV);
WHEREAS, pursuant to the terms, conditions and provisions of the Credit
Agreement, dated as of June 30, 1997 (as amended, restated, supplemented or
otherwise modified from time to time, the "CREDIT AGREEMENT"), among Leiner
Health Products Group Inc. ("LHPG" or the "U.S. BORROWER" (prior to the
Assumption)), Vita Health Company (1985) Ltd. (the "CANADIAN BORROWER"), as
Canadian borrower (collectively, the "BORROWERS"), the institutions from time to
time a party thereto which extend a Commitment under the U.S. Facility
(collectively, the "U.S. LENDERS"), the various financial institutions from time
to time a party thereto which extend a Commitment under the Canadian Facility
(collectively, the "CANADIAN LENDERS", and together with the U.S. Lenders, the
"LENDERS"), The Bank of Nova Scotia ("SCOTIABANK"), as agent for the U.S.
Lenders under the U.S. Facility (in such capacity, the "U.S. AGENT"), and
Scotiabank, currently acting through its executive offices in Toronto, Ontario,
as agent for the Canadian Lenders under the Canadian Facility (in such capacity,
the "CANADIAN AGENT", and together with the U.S. Agent, collectively, the
"AGENTS"), the Lenders and the Issuer have agreed to make Loans to, and to issue
Letters of Credit for the account of, the Borrowers in the maximum original
principal amount of TWO HUNDRED TEN MILLION AND 00/100 DOLLARS ($210,000,000.00)
(such Loans and Letters of Credit are hereinafter referred to collectively as
the "CREDIT EXTENSIONS").
WHEREAS, the Credit Extensions consist of:
(i) from the U.S. Lenders, a Term B Loan Commitment and a Term C Loan
Commitment pursuant to
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which Borrowings of Term Loans, in a maximum aggregate principal amount not
to exceed $45,000,000 (in the case of Term B Loans) and $40,000,000 (in the
case of Term C Loans), will be made to the U.S. Borrower in a single
Borrowing to occur on the date of the initial Credit Extensions;
(ii) from the U.S. RL Lenders, a U.S. Revolving Loan Commitment (to
include availability for U.S. Revolving Loans, U.S. Swing Line Loans and
U.S. Letters of Credit) pursuant to which Borrowings of U.S. Revolving
Loans and U.S. Swing Line Loans, in a maximum aggregate principal amount
(together with all U.S. Letter of Credit Outstandings) not to exceed the
then existing U.S. Revolving Loan Commitment Amount, will be made to the
U.S. Borrower from time to time on and subsequent to the date of the
initial Credit Extensions but prior to the U.S. Revolving Loan Commitment
Termination Date;
(iii) from the U.S. Issuers (and participated in by the U.S. RL
Lenders), a U.S. Letter of Credit Commitment pursuant to which the U.S.
Issuers will issue U.S. Letters of Credit for the account of the U.S.
Borrower and, subject to Section 2.1.2 of the Credit Agreement, its U.S.
Subsidiaries from time to time on and subsequent to the date of the initial
Credit Extensions but prior to the U.S. Revolving Loan Commitment
Termination Date in a maximum aggregate Stated Amount at any one time
outstanding not to exceed $35,000,000 (PROVIDED that the aggregate
outstanding principal amount of U.S. Revolving Loans, Swing Line Loans and
U.S. Letter of Credit Outstandings at any time shall not exceed the then
existing U.S. Revolving Loan Commitment Amount);
(iv) from the U.S. Swing Line Lender (and participated in by the U.S.
RL Lenders), a U.S. Swing Line Loan Commitment pursuant to which Borrowings
of U.S. Swing Line Loans in an aggregate outstanding principal amount not
to exceed $15,000,000 will be made on and subsequent to the date of the
initial Credit Extensions but prior to the U.S. Revolving Loan Commitment
Termination Date (PROVIDED, that the aggregate outstanding principal amount
of such U.S. Swing Line Loans, U.S. Revolving Loans and U.S. Letter of
Credit Outstandings at any time shall not exceed the then existing U.S.
Revolving Loan Commitment Amount);
(v) from the Canadian Lenders, a Canadian Revolving Loan Commitment
(to include availability for Canadian Revolving Loans, Canadian Swing Line
Loans and Canadian Letters of Credit) pursuant to which Borrowings of
Canadian Revolving Loans and Canadian Swing Line Loans in a maximum
aggregate principal
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amount (together with all Canadian Letter of Credit Outstandings) not to
exceed the then existing Canadian Revolving Loan Commitment Amount, will be
made to the Canadian Borrower from time to time on and subsequent to the
date of the initial Credit Extensions but prior to the Canadian Revolving
Loan Commitment Termination Date;
(vi) from the Canadian Issuers (and participated in by the Canadian
Lenders), a Canadian Letter of Credit Commitment pursuant to which the
Canadian Issuers will issue Canadian Letters of Credit for the account of
the Canadian Borrower and, subject to Section 3.1.2 of the Credit
Agreement, the Canadian Borrower's Subsidiaries from time to time on and
subsequent to the date of the initial Credit Extensions but prior to the
Canadian Revolving Loan Commitment Termination Date in a maximum aggregate
Stated Amount at any one time outstanding not to exceed Cdn $13,000,000
(PROVIDED that the aggregate outstanding principal amount of Canadian
Revolving Loans and Canadian Letter of Credit Outstandings at any time
shall not exceed the then existing Canadian Revolving Loan Commitment
Amount); and
(vii) from the Canadian Swing Line Lender (and participated in by the
Canadian Lenders), a Canadian Swing Line Loan Commitment pursuant to which
Borrowings of Canadian Swing Line Loans in an aggregate outstanding
principal amount not to exceed the Cdn $1,400,000 will be made on and
subsequent to the date of the initial Credit Extensions but prior to the
Canadian Revolving Loan Commitment Termination Date (provided that the
aggregate outstanding principal amount of such Canadian Swing Line Loans,
Canadian Revolving Loans and Canadian Letter of Credit Outstandings at any
time shall not exceed the then existing Canadian Revolving Loan Commitment
Amount.
WHEREAS, as contemplated by the Credit Agreement, immediately following the
making of the initial Credit Extensions, the Mortgagor and LHPG have delivered
the Assumption Agreement, pursuant to which the Mortgagor has assumed (the
"ASSUMPTION") the rights and obligations of LHPG as (and has become ) the U.S.
Borrower under the Credit Agreement;
WHEREAS, as a condition precedent to the making of the Credit Extensions
(including the initial Credit Extension) and the execution and delivery of the
Assumption Agreement (as defined in the Credit Agreement) under the Credit
Agreement, the Mortgagor is required to execute and deliver this Mortgage;
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WHEREAS, (i) as a material inducement for the Lenders to enter into the Credit
Agreement and the other Loan Documents, (ii) to secure the payment and
performance of the Mortgagor's obligations under the Credit Agreement and the
other Loan Documents; and (iii) to secure the payment and performance of the
Secured Obligations, the Mortgagor is required to execute and deliver this
Mortgage to the Mortgagee; and
WHEREAS, the Mortgagor has duly authorized the execution, delivery and
performance of this Mortgage.
G R A N T:
NOW, THEREFORE, for and in consideration of the premises, and of the mutual
covenants herein contained, and in order to induce the Lenders to make the
Credit Extensions pursuant to the Credit Agreement, and in order to secure the
full, timely and proper payment and performance of and compliance with each and
every one of the Secured Obligations (as hereinafter defined), the Mortgagor
hereby irrevocably grants, bargains, sells, mortgages, warrants, aliens,
demises, releases, hypothecates, pledges, assigns, transfers and conveys to the
Mortgagee and its successors and assigns, forever, all of the following (the
"COLLATERAL"):
(a) REAL ESTATE. All of the Land and all additional lands and
estates therein now owned or hereafter acquired by the Mortgagor for use or
development with the Land or any portion thereof, together with all and
singular the tenements, rights, easements, hereditaments, rights of way,
privileges, liberties, appendages and appurtenances now or hereafter
belonging or in any way pertaining to the Land and such additional lands
and estates therein (including, without limitation, all rights relating to
storm and sanitary sewer, water, gas, electric, railway and telephone
services); all development rights, air rights, riparian rights, water,
water rights, water stock, all rights in, to and with respect to any and
all oil, gas, coal, minerals and other substances of any kind or character
underlying or relating to the Land and such additional lands and estates
therein and any interest therein; all estate, claim, demand, right, title
or interest of the Mortgagor in and to any street, road, highway or alley,
vacated or other, adjoining the Land or any part thereof and such
additional lands and estates therein; all strips and gores belonging,
adjacent or pertaining to the Land or such additional lands and estates;
and any after-acquired title to any of the foregoing (herein collectively
referred to as the "REAL ESTATE");
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(b) IMPROVEMENTS. All buildings, structures and other improvements
and any additions and alterations thereto or replacements thereof, now or
hereafter built, constructed or located upon the Real Estate; and, to the
extent that any of the following items of property constitutes fixtures
under applicable laws, all furnishings, fixtures, fittings, appliances,
apparatus, equipment, machinery, building and construction materials and
other articles of every kind and nature whatsoever and all replacements
thereof, now or hereafter affixed or attached to, placed upon or used in
any way in connection with the complete and comfortable use, enjoyment,
occupation, operation, development and/or maintenance of the Real Estate or
such buildings, structures and other improvements, including, but not
limited to, partitions, furnaces, boilers, oil burners, radiators and
piping, plumbing and bathroom fixtures, refrigeration, heating,
ventilating, air conditioning and sprinkler systems, other fire prevention
and extinguishing apparatus and materials, vacuum cleaning systems, gas and
electric fixtures, incinerators, compactors, elevators, engines, motors,
generators and all other articles of property which are considered fixtures
under applicable law (such buildings, structures and other improvements and
such other property are herein collectively referred to as the
"IMPROVEMENTS"; the Real Estate and the Improvements are herein
collectively referred to as the "PROPERTY");
(c) GOODS. All building materials, goods, construction materials,
appliances (including, without limitation, stoves, ranges, ovens,
disposals, refrigerators, water fountains and coolers, fans, heaters,
dishwashers, clothes washers and dryers, water heaters, hood and fan
combinations, kitchen equipment, laundry equipment, kitchen cabinets and
other similar equipment), stocks, beds, mattresses, bedding and linens,
supplies, blinds, window shades, drapes, carpets, floor coverings,
manufacturing equipment and machinery, office equipment, growing plants and
shrubberies, control devices, equipment (including window cleaning,
building cleaning, swimming pool, recreational, monitoring, garbage, pest
control and other equipment), motor vehicles, tools, furnishings,
furniture, lighting, non-structural additions to the Real Estate and
Improvements and all other tangible property of any kind or character,
together with all replacements thereof, now or hereafter located on or in
or used or useful in connection with the complete and comfortable use,
enjoyment, occupation, operation, development and/or maintenance of the
Property, regardless of whether or not located on or in the Property or
located elsewhere for purposes of storage,
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fabrication or otherwise (herein collectively referred to as the "GOODS");
(d) INTANGIBLES. All goodwill, trademarks, trade names, option
rights, purchase contracts, real and personal property tax refunds, books
and records and general intangibles of the Mortgagor relating to the
Property, and any other intangible property of the Mortgagor relating to
the Property (herein collectively referred to as the "INTANGIBLES");
(e) LEASES. All rights of the Mortgagor in, to and under all leases,
licenses, occupancy agreements, concessions and other arrangements, oral or
written, now existing or hereafter entered into, whereby any Person agrees
to pay money or any other consideration for the use, possession or
occupancy of, or any estate in, the Property or any portion thereof or
interest therein (herein collectively referred to as the "LEASES"), and the
right, subject to applicable law, upon the occurrence of any Event of
Default hereunder, to receive and collect the Rents (as hereinafter
defined) paid or payable thereunder;
(f) PLANS. All rights of the Mortgagor in and to all plans and
specifications, designs, drawings and other information, materials and
matters heretofore or hereafter prepared relating to the Improvements or
any construction on the Real Estate (herein collectively referred to as the
"PLANS");
(g) PERMITS. All rights of the Mortgagor, to the extent assignable,
in, to and under all permits, franchises, licenses, approvals and other
authorizations respecting the use, occupation and operation of the Property
and every part thereof and respecting any business or other activity
conducted on or from the Property, and any product or proceed thereof or
therefrom, including, without limitation, all building permits,
certificates of occupancy and other licenses, permits and approvals issued
by governmental authorities having jurisdiction (herein collectively
referred to as the "PERMITS");
(h) CONTRACTS. All right, title and interest of the Mortgagor in and
to all agreements, contracts, certificates, instruments, warranties,
appraisals, engineering, environmental, soils, insurance and other reports
and studies, books, records, correspondence, files and advertising
materials, and other documents, now or hereafter obtained or entered into,
as the case may be, pertaining to the construction, use, occupancy,
possession, operation, management, leasing, maintenance and/or ownership of
the Property and all right, title
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and interest of the Mortgagor therein (herein collectively referred to as
the "CONTRACTS");
(i) LEASES OF FURNITURE, FURNISHINGS AND EQUIPMENT. All right, title
and interest of the Mortgagor as lessee in, to and under any leases of
furniture, furnishings, equipment and any other Goods now or hereafter
installed in or at any time used in connection with the Property;
(j) RENTS. All rents, issues, profits, royalties, avails, income and
other benefits derived or owned, directly or indirectly, by the Mortgagor
from the Property, including, without limitation, all rents and other
consideration payable by tenants, claims against guarantors, and any cash
or other securities deposited to secure performance by tenants, under the
Leases (herein collectively referred to as "RENTS");
(k) PROCEEDS. All proceeds of the conversion, voluntary or
involuntary of any of the foregoing into cash or liquidated claims,
including, without limitation, proceeds of insurance and condemnation
awards (herein collectively referred to as "PROCEEDS"); and
(l) OTHER PROPERTY. All other property and rights of the Mortgagor
of every kind and character relating to the Property, and all proceeds and
products of any of the foregoing;
AND, without limiting any of the other provisions of this Mortgage, the
Mortgagor expressly grants to the Mortgagee, as secured party, a security
interest in all of those portions of the Collateral which are or may be subject
to the State Uniform Commercial Code provisions applicable to secured
transactions;
TO HAVE AND TO HOLD the Collateral unto the Mortgagee, its successors and
assigns, forever.
FURTHER to secure the full, timely and proper payment and performance of
the Secured Obligations, the Mortgagor hereby covenants and agrees with and
warrants to the Mortgagee as follows:
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ARTICLE 1.
COVENANTS AND AGREEMENTS OF THE MORTGAGOR
SECTION 1.1 PAYMENT OF SECURED OBLIGATIONS. (i) The Mortgagor agrees
that:
(a) it will duly and punctually pay and perform or cause to be paid
and performed each of the Obligations at the time and in accordance with
the terms of the Loan Documents, and
(b) when and as due and payable from time to time in accordance with
the terms hereof or of any other Loan Documents, pay and perform, or cause
to be paid and performed, all other Secured Obligations.
SECTION 1.2 TITLE TO COLLATERAL, ETC. The Mortgagor represents and
warrants to and covenants with the Mortgagee that:
(a) as of the date hereof and at all times hereafter while this
Mortgage is outstanding, the Mortgagor (1) is and shall be the absolute
owner of the legal and beneficial title to the Property and to all other
property included in the Collateral, and (2) has and shall have good and
marketable title in fee simple absolute to the Property, subject in each
case only to this Mortgage, the liens expressly permitted pursuant to the
terms of the Credit Agreement and the encumbrances set forth in SCHEDULE 2
hereto (collectively, the "PERMITTED ENCUMBRANCES");
(b) the Mortgagor has good and lawful right, power and authority to
execute this Mortgage and to convey, transfer, assign, mortgage and grant a
security interest in the Collateral, all as provided herein;
(c) this Mortgage has been duly executed, acknowledged and delivered
on behalf of the Mortgagor, all consents and other actions required to be
taken by the officers, directors, shareholders and partners, as the case
may be, of the Mortgagor have been duly and fully given and performed and
this Mortgage constitutes the legal, valid and binding obligation of the
Mortgagor, enforceable against the Mortgagor in accordance with its terms;
and
(d) the Mortgagor, at its expense, will warrant and defend to the
Mortgagee and any purchaser under the power of sale herein or at any
foreclosure sale such title to the Collateral and the first mortgage lien
and first priority perfected security interest of this Mortgage thereon and
therein against all claims and demands and will maintain, preserve and
protect such
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lien and security interest and will keep this Mortgage a valid, direct
first mortgage lien of record on and a first priority perfected security
interest in the Collateral, subject only to the Permitted Encumbrances.
SECTION 1.3 TITLE INSURANCE.
SECTION 1.3.1 TITLE INSURANCE POLICY. Concurrently with the execution and
delivery of this Mortgage, the Mortgagor, at its expense, has obtained and
delivered to the Mortgagee a loan policy or policies of title insurance in an
amount, and in form and substance, satisfactory to the Mortgagee naming the
Mortgagee as the insured, insuring the title to and the first mortgage lien of
this Mortgage on the Property, with endorsements requested by the Mortgagee.
The Mortgagor has duly paid in full all premiums and other charges due in
connection with the issuance of such policy or policies of title insurance.
SECTION 1.3.2 TITLE INSURANCE PROCEEDS. All proceeds received by and
payable to the Mortgagee for any loss under the loan policy or policies of title
insurance delivered to the Mortgagee pursuant to SECTION 1.3.1, or under any
policy or policies of title insurance delivered to the Mortgagee in substitution
therefor or replacement thereof, shall be the property of the Mortgagee and
shall be applied by the Mortgagee in accordance with the provisions of SECTION
2.3.
SECTION 1.4 RECORDATION. The Mortgagor, at its expense, will at all times
cause this Mortgage and any instruments amendatory hereof or supplemental hereto
and any instruments of assignment hereof or thereof (and any appropriate
financing statements or other instruments and continuations thereof), and each
other instrument delivered in connection with the Credit Agreement or any other
Loan Document and intended thereunder to be recorded, registered and filed, to
be kept recorded, registered and filed, in such manner and in such places, and
will pay all such recording, registration, filing fees, taxes and other charges,
and will comply with all such statutes and regulations as may be required by law
in order to establish, preserve, perfect and protect the lien and security
interest of this Mortgage as a valid, direct first mortgage lien and first
priority perfected security interest in the Collateral, subject only to the
Permitted Encumbrances. The Mortgagor will pay or cause to be paid, and will
indemnify the Mortgagee in respect of, all taxes (including interest and
penalties) at any time payable in connection with the filing and recording of
this Mortgage and any and all supplements and amendments hereto.
SECTION 1.5 PAYMENT OF IMPOSITIONS, ETC. Subject to Section 1.8 (relating
to permitted contests), the Mortgagor will pay or cause to be paid at least ten
(10) days before the same would become delinquent and before any fine,
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penalty, interest or cost may be added for non-payment, all taxes, assessments,
water and sewer rates, charges, license fees, inspection fees and other
governmental levies or payments, of every kind and nature whatsoever, general
and special, ordinary and extraordinary, unforeseen as well as foreseen, which
at any time may be assessed, levied, confirmed, imposed or which may become a
lien upon the Collateral, or any portion thereof, or which are payable with
respect thereto, or upon the rents, issues, income or profits thereof, or on the
occupancy, operation, use, possession or activities thereof, whether any or all
of the same be levied directly or indirectly or as excise taxes or as income
taxes, and all taxes, assessments or charges which may be levied on the Secured
Obligations, or the interest thereon (collectively, the "IMPOSITIONS"). The
Mortgagor will deliver to the Mortgagee, upon request, copies of official
receipts or other satisfactory proof evidencing such payments.
SECTION 1.6 INSURANCE AND LEGAL REQUIREMENTS. Subject to SECTION 1.8
(relating to permitted contests), the Mortgagor, at its expense, will comply in
all material respects, or cause compliance in all material respects with
(a) all provisions of any insurance policy covering or applicable to
the Collateral or any part thereof, all requirements of the issuer of any
such policy, and all orders, rules, regulations and other requirements of
the National Board of Fire Underwriters (or any other body exercising
similar functions) applicable to or affecting the Collateral or any part
thereof or any use or condition of the Collateral or any part thereof
(collectively, the "INSURANCE REQUIREMENTS"); and
(b) all laws, including Environmental, Health or Safety Requirements
of Law, statutes, codes, acts, ordinances, orders, judgments, decrees,
injunctions, rules, regulations, permits, licenses, authorizations,
directions and requirements of all governments, departments, commissions,
boards, courts, authorities, agencies, officials and officers, foreseen or
unforeseen, ordinary or extraordinary, which now or at any time hereafter
may be applicable to the Collateral or any part thereof, or any of the
adjoining sidewalks, curbs, vaults and vault space, if any, streets or
ways, or any use or condition of the Collateral or any part thereof
(collectively, the "LEGAL REQUIREMENTS");
whether or not compliance therewith shall require structural changes in or
interference with the use and enjoyment of the Collateral or any part thereof.
SECTION 1.7 SECURITY INTERESTS, ETC. The Mortgagor will not directly or
indirectly create or permit or suffer
11
to be created or to remain, and will promptly discharge or cause to be
discharged, any deed of trust, mortgage, encumbrance or charge on, pledge of,
security interest in or conditional sale or other title retention agreement with
respect to or any other lien on or in the Collateral or any part thereof or the
interest of the Mortgagor or the Mortgagee therein, or any Proceeds thereof or
Rents or other sums arising therefrom, other than (a) Permitted Encumbrances,
and (b) liens of mechanics, materialmen, suppliers or vendors or rights thereto
incurred in the ordinary course of the business of the Mortgagor for sums not
yet due or any such liens or rights thereto which are at the time being
contested as permitted by SECTION 1.8. The Mortgagor will not postpone the
payment of any sums for which liens of mechanics, materialmen, suppliers or
vendors or rights thereto have been incurred (unless such liens or rights
thereto are at the time being contested as permitted by SECTION 1.8), or enter
into any contract under which payment of such sums is postponable (unless such
contract expressly provides for the legal, binding and effective waiver of any
such liens or rights thereto), in either case, for more than 60 days after the
completion of the action giving rise to such liens or rights thereto.
SECTION 1.8 PERMITTED CONTESTS. After prior written notice to the
Mortgagee, the Mortgagor at its expense may contest, or cause to be contested,
by appropriate legal proceedings conducted in good faith and with due diligence,
the amount or validity or application, in whole or in part, of any Imposition,
Legal Requirement or Insurance Requirement or lien of a mechanic, materialman,
supplier or vendor, PROVIDED THAT, (a) in the case of an unpaid Imposition,
lien, encumbrance or charge, such proceedings shall suspend the collection
thereof from the Mortgagor, the Mortgagee, and the Collateral (including any
rent or other income therefrom) and shall not interfere with the payment of any
such rent or income, (b) neither the Collateral nor any rent or other income
therefrom nor any part thereof or interest therein would be in any danger of
being sold, forfeited, lost, impaired or interfered with, (c) in the case of a
Legal Requirement, neither the Mortgagor nor the Mortgagee would be in danger of
any material civil or criminal liability for failure to comply therewith, (d)
the Mortgagor shall have furnished such security, if any, as may be required in
the proceedings or as may be reasonably requested by the Mortgagee, (e) the
non-payment of the whole or any part of any Imposition will not result in the
delivery of a tax deed to the Collateral or any part thereof because of such
non-payment, (f) the payment of any sums required to be paid with respect to any
of the Notes or under this Mortgage (other than any unpaid Imposition, lien,
encumbrance or charge at the time being contested in accordance with this
SECTION 1.8) shall not be interfered with or otherwise affected, (g) in the case
of any Insurance Requirement, the failure of the Mortgagor to comply
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therewith shall not affect the validity of any insurance required to be
maintained by the Mortgagor under SECTION 2.1, and (h) that adequate reserves,
determined in accordance with GAAP, shall have been set aside on the Mortgagor's
books.
SECTION 1.9 LEASES. The Mortgagor represents and warrants to the
Mortgagee that, as of the date hereof, there are no written or oral leases or
other agreements of any kind or nature relating to the occupancy of any portion
of the Property by any Person other than the Mortgagor. The Mortgagor will not
enter into any such written or oral lease or other agreement with respect to any
portion of the Property without first obtaining the written consent of the
Mortgagee.
SECTION 1.10 COMPLIANCE WITH INSTRUMENTS. The Mortgagor at its expense
will promptly comply with all rights of way or use, privileges, franchises,
servitudes, licenses, easements, tenements, hereditaments and appurtenances
forming a part of the Property and all instruments creating or evidencing the
same, in each case, to the extent compliance therewith is required of the
Mortgagor under the terms thereof. The Mortgagor will not take any action which
may result in a forfeiture or termination of the rights afforded to the
Mortgagor under any such instruments and will not, without the prior written
consent of the Mortgagee, amend any of such instruments.
SECTION 1.11 MAINTENANCE AND REPAIR, ETC. Subject to the provisions of
SECTION 1.12, the Mortgagor will keep or cause to be kept all presently and
subsequently erected or acquired Improvements and the sidewalks, curbs, vaults
and vault space, if any, located on or adjoining the same, and the streets and
the ways adjoining the same, in good and substantial order and repair and in
such a fashion that neither the value nor utility of the Collateral will not be
diminished, and, at its sole cost and expense, will promptly make or cause to be
made all necessary and appropriate repairs, replacements and renewals thereof,
whether interior or exterior, structural or nonstructural, ordinary or
extraordinary, foreseen or unforeseen, so that its business carried on in
connection therewith may be properly conducted at all times. All repairs,
replacements and renewals shall be at least equal in quality, use and value to
the original Improvements. The Mortgagor at its expense will do or cause to be
done all shoring of foundations and walls of any building or other Improvements
on the Property and (to the extent permitted by law) of the ground adjacent
thereto, and every other act necessary or appropriate for the preservation and
safety of the Property by reason of or in connection with any excavation or
other building operation upon the Property and upon any adjoining property,
whether or not the Mortgagor shall, by any Legal Requirement, be
13
required to take such action or be liable for failure to do so.
SECTION 1.12 ALTERATIONS, ADDITIONS, ETC. So long as no Event of Default
shall have occurred and be continuing, the Mortgagor shall have the right at any
time and from time to time to make or cause to be made reasonable alterations of
and additions to the Property or any part thereof, PROVIDED THAT any alteration
or addition: (a) shall not change the general character or the use of the
Property or reduce the fair market value thereof below its value immediately
before such alteration or addition, or impair the usefulness of the Property;
(b) is effected with due diligence, in a good and workmanlike manner and in
compliance with all Legal Requirements and Insurance Requirements; (c) is
promptly and fully paid for, or caused to be paid for, by the Mortgagor; (d) is
made, in case the estimated cost of such alteration or addition exceeds U.S.
$250,000, (i) only after the Mortgagee shall have consented thereto and shall
have reviewed and approved in writing the plans and specifications therefor,
(ii) under the supervision of a qualified architect or engineer or another
professional approved by the Mortgagee and (iii) only after the Mortgagor shall
have furnished to the Mortgagee a performance bond or other security reasonably
satisfactory to the Mortgagee.
SECTION 1.13 ACQUIRED PROPERTY SUBJECT TO LIEN. All property at any time
acquired by the Mortgagor and provided or required by this Mortgage to be or
become subject to the lien and security interest hereof, whether such property
is acquired by exchange, purchase, construction or otherwise, shall forthwith
become subject to the lien and security interest of this Mortgage without
further action on the part of the Mortgagor or the Mortgagee. The Mortgagor, at
its expense, will execute and deliver to the Mortgagee (and will record and file
as provided in SECTION 1.4) an instrument supplemental to this Mortgage
satisfactory in substance and form to the Mortgagee, whenever such an instrument
is necessary under applicable law to subject to the lien and security interest
of this Mortgage all right, title and interest of the Mortgagor in and to all
property provided or required by this Mortgage to be subject to the lien and
security interest hereof.
SECTION 1.14 ASSIGNMENT OF RENTS, PROCEEDS, ETC. The assignment, grant
and conveyance of the Leases, Rents, Proceeds and other rents, income, proceeds
and benefits of the Collateral contained in the Granting Clause of this Mortgage
shall constitute an absolute, present and irrevocable assignment, grant and
conveyance, PROVIDED, HOWEVER, that permission is hereby given to the Mortgagor,
so long as no Event of Default has occurred hereunder, to collect, receive and
apply such Rents, Proceeds and other rents, income, proceeds and benefits as
they become due and
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payable, but not in advance thereof, and in accordance with all of the other
terms, conditions and provisions hereof, of the Loan Documents, and of the
Leases, contracts, agreements and other instruments with respect to which such
payments are made or such other benefits are conferred. Upon the occurrence of
an Event of Default, such permission shall terminate immediately and
automatically, without notice to the Mortgagor or any other Person except as
required by law, and shall not be reinstated upon a cure of such Event of
Default without the express written consent of the Mortgagee. Such assignment
shall be fully effective without any further action on the part of the Mortgagor
or the Mortgagee and the Mortgagee shall be entitled, at its option, upon the
occurrence of an Event of Default hereunder, to collect, receive and apply all
Rents, Proceeds and all other rents, income, proceeds and benefits from the
Collateral, including all right, title and interest of the Mortgagor in any
escrowed sums or deposits or any portion thereof or interest therein, whether or
not the Mortgagee takes possession of the Collateral or any part thereof. The
Mortgagor further grants to the Mortgagee the right, at the Mortgagee's option,
upon the occurrence of an Event of Default hereunder, to:
(a) enter upon and take possession of the Property for the purpose of
collecting Rents, Proceeds and said rents, income, proceeds and other
benefits;
(b) dispossess by the customary summary proceedings any tenant,
purchaser or other Person defaulting in the payment of any amount when and
as due and payable, or in the performance of any other obligation, under
any Lease, contract or other instrument to which said Rents, Proceeds or
other rents, income, proceeds or benefits relate;
(c) let or convey the Collateral or any portion thereof or any
interest therein; and
(d) apply Rents, Proceeds and such rents, income, proceeds and other
benefits, after the payment of all necessary fees, charges and expenses, on
account of the Secured Obligations in accordance with SECTION 3.11.
SECTION 1.15 NO CLAIMS AGAINST THE MORTGAGEE. Nothing contained in this
Mortgage shall constitute any consent or request by the Mortgagee, express or
implied, for the performance of any labor or the furnishing of any materials or
other property in respect of the Property or any part thereof, or be construed
to permit the making of any claim against the Mortgagee in respect of labor or
services or the furnishing of any materials or other property or any claim that
any lien based on the performance of such labor or the furnishing of any such
materials or other property is prior to the lien and security interest of this
Mortgage. ALL
15
CONTRACTORS, SUBCONTRACTORS, VENDORS AND OTHER PERSONS DEALING WITH THE
PROPERTY, OR WITH ANY PERSONS INTERESTED THEREIN, ARE HEREBY REQUIRED TO TAKE
NOTICE OF THE PROVISIONS OF THIS SECTION.
SECTION 1.16 INDEMNIFICATION. The Mortgagor will protect, indemnify, save
harmless and defend the Mortgagee, the Lenders, and each of their respective
officers, directors, shareholders, employees, representatives and agents
(collectively, the "INDEMNIFIED PARTIES" and individually, an "INDEMNIFIED
PARTY"), from and against any and all liabilities, obligations, claims, damages,
penalties, causes of action, costs and expenses (including, without limitation,
reasonable attorneys' fees and expenses) imposed upon or incurred by or asserted
against any Indemnified Party by reason of (a) ownership of an interest in this
Mortgage, any other Loan Document or the Property, (b) any accident, injury to
or death of persons or loss of or damage to or loss of the use of property
occurring on or about the Property or any part thereof or the adjoining
sidewalks, curbs, vaults and vault spaces, if any, streets, alleys or ways, (c)
any use, non-use or condition of the Property or any part thereof or the
adjoining sidewalks, curbs, vaults and vault spaces, if any, streets, alleys or
ways, (d) any failure on the part of the Mortgagor to perform or comply with any
of the terms of this Mortgage, (e) performance of any labor or services or the
furnishing of any materials or other property in respect of the Collateral or
any part thereof made or suffered to be made by or on behalf of the Mortgagor,
(f) any negligence or tortious act on the part of the Mortgagor or any of its
agents, contractors, lessees, licensees or invitees, (g) any work in connection
with any alterations, changes, new construction or demolition of or additions to
the Property, or (h) (i) any Hazardous Material (as such term is defined in the
Credit Agreement) on, in, under or affecting all or any portion of the Property,
the groundwater, or any surrounding areas, (ii) any misrepresentation,
inaccuracy or breach of any warranty, covenant or agreement contained or
referred to in SECTIONS 1.20 and 1.21, (iii) any violation or claim of violation
by the Mortgagor of any Environmental, Health or Safety Requirements of Law, or
(iv) the imposition of any lien for damages caused by or the recovery of any
costs for the cleanup, release or threatened release of any Hazardous Material.
If any action or proceeding be commenced, to which action or proceeding any
Indemnified Party is made a party by reason of the execution of this Mortgage or
any other Loan Document, or in which it becomes necessary to defend or uphold
the lien of this Mortgage, all sums paid by the Indemnified Parties, for the
expense of any litigation to prosecute or defend the rights and lien created
hereby or otherwise, shall be paid by the Mortgagor to such Indemnified Parties,
as the case may be, as hereinafter provided. The Mortgagor will pay and save
the Indemnified Parties harmless against any and all liability
16
with respect to any intangible personal property tax or similar imposition of
the State or any subdivision or authority thereof now or hereafter in effect,
to the extent that the same may be payable by the Indemnified Parties in
respect of this Mortgage, any Loan Document or any Secured Obligation. All
amounts payable to the Indemnified Parties under this SECTION 1.16. shall be
deemed indebtedness secured by this Mortgage and any such amounts which are
not paid within ten (10) days after written demand therefor by any
Indemnified Party shall bear interest at the rate provided for in Section
5.2.2. of the Credit Agreement from the date of such demand. In case any
action, suit or proceeding is brought against any Indemnified Party by reason
of any such occurrence, the Mortgagor, upon request of such Indemnified
Party, will, at the Mortgagor's expense, resist and defend such action, suit
or proceeding or cause the same to be resisted or defended by counsel
designated by the Mortgagor and approved by such Indemnified Party. The
obligations of the Mortgagor under this SECTION 1.16 shall survive any
discharge or reconveyance of this Mortgage and payment in full of the Secured
Obligations.
SECTION 1.17 NO CREDIT FOR PAYMENT OF TAXES. The Mortgagor shall not be
entitled to any credit against the Secured Obligations by reason of the payment
of any tax on the Property or any part thereof or by reason of the payment of
any other Imposition, and shall not apply for or claim any deduction from the
taxable value of the Property or any part thereof by reason of this Mortgage.
SECTION 1.18 OFFERING OF THE NOTES; APPLICATION OF PROCEEDS OF LOANS.
Neither the Mortgagor nor any Person acting on behalf of the Mortgagor has
directly or indirectly offered the Notes or any portion thereof or any similar
security to, or solicited any offer to buy any of the same from, any Person
other than the Mortgagee. Neither the Mortgagor nor any Person acting on behalf
of the Mortgagor has taken or will take any action which would subject the
issuance of the Notes to the provisions of section 5 of the Securities Act of
1933, as amended. The Mortgagor (a) will not use or permit to be used any
proceeds of the Loans, directly or indirectly, for the purpose, whether
immediate, incidental or ultimate, of "purchasing" or "carrying" any "margin
stock" within the meaning of Regulation U of the Federal Reserve Board, as
amended from time to time, and (b) has or will apply all of the proceeds of the
Loans that are paid to it by the Mortgagee to the purposes permitted by the
Credit Agreement.
SECTION 1.19 NO TRANSFER OF THE PROPERTY. Except as set forth in the
Credit Agreement, the Mortgagor shall not, without the prior written consent of
the Mortgagee, which consent may be granted or withheld in the sole and absolute
discretion of the Mortgagee (i) sell, convey, assign or otherwise transfer the
Property or any portion of the
17
Mortgagor's interest therein or (ii) further encumber the Property or permit the
Property to become encumbered by any lien, claim, security interest or other
indebtedness of any kind or nature other than the Permitted Encumbrances.
SECTION 1.20 SECURITY AGREEMENT. With respect to the items of personal
property and fixtures referred to and described in the Granting Clause of this
Mortgage and included as part of the Collateral, this Mortgage is hereby made
and declared to be a security agreement encumbering each and every item of
personal property and fixtures now or hereafter owned by Mortgagor and included
herein as a part of the Collateral, in compliance with the provisions of the
Uniform Commercial Code as enacted in the State. In this respect, Mortgagor, as
"Debtor", expressly grants to Mortgagee, as "Secured Party", a security interest
in and to all of the property now or hereafter owned by Mortgagor which
constitutes the personal property and fixtures hereinabove referred to and
described in this Mortgage, including all extensions, accessions, additions,
improvements, betterments, renewals, replacements and substitutions thereof or
thereto, and all proceeds from the sale or other disposition thereof. Mortgagor
agrees that Mortgagee may file this Mortgage, or a reproduction thereof, in the
real estate records or other appropriate index, as, and this Mortgage shall be
deemed to be, a financing statement filed as a fixture filing in accordance with
the Uniform Commercial Code as enacted in the State. Any reproduction of this
Mortgage or of any other security agreement or financing statement shall be
sufficient as a financing statement. In addition, Mortgagor agrees to execute
and deliver to Mortgagee, upon Mortgagee's request, any other security agreement
and financing statements, as well as extensions, renewals, and amendments
thereof, and reproductions of this Mortgage, in such form as Mortgagee may
require to perfect a security interest with respect to said items. Mortgagor
shall pay all costs of filing such financing statements and any extensions,
renewals, amendments and releases thereof, and shall pay all reasonable costs
and expenses of any record searches for financing statements Mortgagee may
reasonably require. Without the prior written consent of Mortgagee, Mortgagor
shall not create or suffer to be created pursuant to the Uniform Commercial Code
any other security interest in the above-described personal property and
fixtures, including any replacements and additions thereto. Upon the occurrence
of an Event of Default under this Mortgage, or any other violation of the
covenants, terms and conditions of the security agreement contained herein, the
Mortgagee shall have and shall be entitled to exercise any and all of the rights
and remedies (i) as prescribed in this Mortgage, or (ii) as prescribed by
general law, or (iii) as prescribed by the specific statutory provisions now or
hereafter enacted and specified in said Uniform Commercial Code, all at
Mortgagee's sole election. Mortgagor and Mortgagee agree
18
that the filing of any financing statements in the records normally having to do
with personal property shall not in any way affect the agreement of Mortgagor
and Mortgagee that everything located in, on or about, or used or intended to be
used with or in connection with the use, operation or enjoyment of, the
Collateral, which is described or reflected as a fixture in this Mortgage, is,
and at all times and for all purposes and in all proceedings, both legal and
equitable, shall be, regarded as part of the Real Estate conveyed hereby.
Mortgagor warrants that Mortgagor's name, identity and address are as set forth
herein. The mailing address of the Mortgagee from which information may be
obtained concerning the security interest created herein is also set forth
herein. This information hereof is provided in order that this Mortgage shall
comply with the requirements of the Uniform Commercial Code as enacted in the
State for instruments to be filed as financing statements. In accordance with
the Uniform Commercial Code as enacted in the State, this Mortgage shall remain
effective as a fixture filing until this Mortgage is released or satisfied of
record or its effectiveness otherwise terminates as to the Collateral.
SECTION 1.21 REPRESENTATIONS AND WARRANTIES. In order to induce the
Mortgagee to enter into this Mortgage, the Credit Agreement and the other Loan
Documents, the Mortgagor agrees that all of the representations and warranties
set forth in the Credit Agreement are incorporated into this Mortgage by
reference as if fully set forth herein.
SECTION 1.22 MORTGAGOR'S COVENANTS. In order to induce the Mortgagee to
enter into this Mortgage, the Credit Agreement and the other Loan Documents, the
Mortgagor agrees that all of the covenants set forth in the Credit Agreement are
incorporated into this Mortgage by reference as if fully set forth herein.
ARTICLE 2.
INSURANCE; DAMAGE, DESTRUCTION OR TAKING, ETC.
SECTION 2.1 INSURANCE.
SECTION 2.1.1 RISKS TO BE INSURED. The Mortgagor will, at its expense,
maintain or cause to be maintained by insurance carriers that meet the standards
set forth below: (a) insurance with respect to the Improvements against loss or
damage by fire, lightning and such other risks as are included in standard
"all-risk" policies, in amounts sufficient to prevent the Mortgagor and the
Mortgagee from becoming a co-insurer of any partial loss under the applicable
policies, but in any event in amounts not less than the then full insurable
value (actual replacement value) of the Improvements, as determined by the
Mortgagor
19
in accordance with generally accepted insurance practice and reasonably approved
by the Mortgagee or, at the request of the Mortgagee, as determined at the
Mortgagor's expense by the insurer or insurers or by an expert reasonably
approved by the Mortgagee, (b) comprehensive public liability, including bodily
injury and product liability and property damage insurance, with personal injury
endorsements, applicable to the Property in such amounts as are usually carried
by Persons of comparable size engaged in the same or a similar business and
similarly situated in the same general locality, but in any event with a
combined single limit of not less than Twenty Million Dollars ($20,000,000) per
occurrence, (c) explosion insurance in respect of any steam and pressure boilers
and similar apparatus located in the Property in such amounts as are usually
carried by Persons of comparable size engaged in the same or a similar business
and similarly situated in the same general locality, but in any event in an
amount not less than Twenty Million Dollars ($20,000,000), (d) business
interruption insurance (including added expense coverage) against all insurable
perils for a period of not fewer than twelve (12) months (subject to a
reasonable aggregate deductible not exceeding five (5) days per annum), and (e)
worker's compensation insurance to the full extent required by applicable law
for all employees of the Mortgagor engaged in any work on or about the Property
and employer's liability insurance with a limit of not less than Ten Million
Dollars ($10,000,000) for each occurrence.
All such insurance shall be provided (i) by insurers authorized by Lloyds
of London to underwrite such risks, (ii) by insurers having an A.M. Best
policyholders rating of not less than A-(except with respect to insurers
providing workers compensation insurance, in which case such insurers shall have
an A.M. Best policyholders rating of not less than B+), or (iii) by such other
insurers as the Mortgagee may approve in writing; PROVIDED that if the rating
of any of the insurers providing insurance hereunder is downgraded, the
Mortgagor shall only be required to obtain replacement insurance with an insurer
satisfying the requirements hereof at the stated expiration of the insurance
policy maintained with the insurer whose rating was so downgraded.
SECTION 2.1.2. POLICY PROVISIONS. All insurance maintained by the
Mortgagor pursuant to SECTION 2.1.1 shall (a) (except for worker's compensation
insurance) name the Mortgagor as the insured with the Mortgagee named as
mortgagee and loss payee, (b) (except for worker's compensation and public
liability insurance) provide that the proceeds for any losses shall be adjusted
by the Mortgagor subject to the reasonable approval of the Mortgagee in the
event the proceeds shall exceed Two Hundred Fifty Thousand Dollars ($250,000),
and shall be payable to the Mortgagee, to be held and applied as provided in
SECTION 2.3, (c) include effective waivers by the insurer of all
20
rights of subrogation against any named insured, the indebtedness secured by
this Mortgage and the Property and all claims for insurance premiums against the
Mortgagee, (d) provide that any losses shall be payable notwithstanding (i) any
act, failure to act or negligence of or violation of warranties, declarations or
conditions contained in such policy by any named insured, (ii) the occupation or
use of the Property for purposes more hazardous than permitted by the terms
thereof, (iii) any foreclosure or other action or proceeding taken by the
Mortgagee pursuant to any provision of this Mortgage, or (iv) any change in
title or ownership of the Property, (e) provide that no cancellation, reduction
in amount or material change in coverage thereof or any portion thereof shall be
effective until at least ten (10) days after receipt by the Mortgagee of written
notice thereof, (f) provide that any notice under such policies shall be
simultaneously delivered to the Mortgagee, and (g) be reasonably satisfactory in
all other material respects to the Mortgagee. Any insurance maintained pursuant
to this SECTION 2.1 may be evidenced by blanket insurance policies covering the
Property and other properties or assets of the Mortgagor, and shall in all other
respects comply with the requirements of this SECTION 2.1.
SECTION 2.1.3. DELIVERY OF POLICIES, ETC. The Mortgagor will deliver to
the Mortgagee, promptly upon request, (a) certified copies of all policies
evidencing all insurance required to be maintained under SECTION 2.1.1 (or, in
the case of blanket policies, certificates thereof by the insurers together with
a copy of each blanket policy), and (b) evidence, in the form of receipted
bills, as to the payment of all premiums due thereon (with respect to public
liability insurance policies, all installments for the current year due thereon
to such date), PROVIDED THAT the Mortgagee shall not be deemed by reason of its
custody of such policies to have knowledge of the contents thereof. The
Mortgagor will also deliver to the Mortgagee not later than thirty (30) days
prior to the expiration of any policy a binder or certificate of the insurer
evidencing the replacement thereof. In the event the Mortgagor shall fail to
effect or maintain any insurance required to be effected or maintained pursuant
to the provisions of this SECTION 2.1, the Mortgagor will indemnify the
Mortgagee against damage, loss or liability resulting from all risks for which
such insurance should have been effected or maintained.
SECTION 2.1.4. SEPARATE INSURANCE. The Mortgagor will not take out
separate insurance concurrent in form or contributing in the event of loss with
that required to be maintained pursuant to this SECTION 2.1.
SECTION 2.1.5. FLOOD INSURANCE. The Mortgagor represent and warrants that
the Improvements are not located in an area designated as "flood prone" (as
defined under the National Flood Insurance Regulations) or, to the extent the
21
Improvements or any portion thereof are located in an area designated as "flood
prone", the Mortgagor maintains in full force and effect flood insurance under
the National Flood Insurance Program to the extent and in the amount required by
applicable laws.
SECTION 2.2 DAMAGE, DESTRUCTION OR TAKING; MORTGAGOR TO GIVE NOTICE;
ASSIGNMENT OF AWARDS. In case of
(a)any damage to or destruction of the Collateral or any part thereof,
or
(b)any taking, whether for permanent or temporary use, of all or any
part of the Collateral or any interest therein or right accruing thereto,
as the result of or in anticipation of the exercise of the right of
condemnation or eminent domain, or a change of grade affecting the
Collateral or any portion thereof (a "TAKING"), or the commencement of any
proceedings or negotiations which may result in a Taking,
the Mortgagor will promptly give written notice thereof to the Mortgagee,
generally describing the nature and extent of such damage or destruction and the
Mortgagor's best estimate of the cost of restoring the Collateral, or the nature
of such proceedings or negotiations and the nature and extent of the Taking
which might result therefrom, as the case may be. Subject to SECTION 2.3, the
Mortgagee shall be entitled to all insurance proceeds payable on account of such
damage or destruction and to all awards or payments allocable to the Collateral
on account of such Taking, and the Mortgagor hereby irrevocably assigns,
transfers and sets over to the Mortgagee all rights of the Mortgagor to any such
proceeds, awards or payments and irrevocably authorizes and empowers the
Mortgagee, at its option, in the name of the Mortgagor or otherwise, to file and
prosecute what would otherwise be the Mortgagor's claim for any such proceeds,
award or payment and to collect, receipt for and retain the same for disposition
in accordance with SECTION 2.3. The Mortgagor will pay all reasonable costs and
expenses incurred by the Mortgagee in connection with any such damage,
destruction or Taking and seeking and obtaining any insurance proceeds, awards
or payments in respect thereof.
SECTION 2.3 APPLICATION OF PROCEEDS AND AWARDS. The Mortgagee may, at its
option, apply all amounts recovered under any insurance policy required to be
maintained by the Mortgagor hereunder and all awards received by it on account
of any Taking in any one or more of the following ways:
(a) to the payment of the reasonable costs and expenses incurred by
the Mortgagee in obtaining any such insurance proceeds or awards, including
the fees and expenses of attorneys and insurance and other experts and
consultants, the costs of litigation,
22
arbitration, mediation, investigations and other judicial, administrative
or other proceedings and all other out-of-pocket expenses;
(b) to the payment of the principal of the Credit Extensions and any
interest (including post-petition interest payable in any proceedings for
bankruptcy under applicable law ("POST-PETITION INTEREST") to the extent
such interest is a Secured Obligation) accrued and unpaid thereon, without
regard to whether any portion or all of such amounts shall be matured or
unmatured, together with interest at the rate provided for in the Credit
Agreement on any overdue principal and (to the extent permitted by
applicable law) interest; and, in case such amount shall be insufficient to
pay in full all such amounts, then such amount shall be applied, FIRST, to
the payment of all amounts of interest (including Post-Petition Interest to
the extent such interest is a Secured Obligation) accrued on the Credit
Extensions and unpaid, SECOND, to the payment of all amounts of principal
at the time outstanding;
(c) to the payment of, or the application to, any Secured Obligation
(other than as provided in CLAUSE (B) above);
(d) to fulfill any of the other covenants contained herein, in the
Credit Agreement, or in any other Loan Document, as the Mortgagee may
determine in its sole discretion;
(e) to the Mortgagor for application to the cost of restoring the
Collateral and the replacement of Goods destroyed, damaged or taken; or
(f) to the Mortgagor.
Notwithstanding the foregoing provisions of this SECTION 2.3 to the
contrary (but subject to the provisions of SECTION 2.4), and if each of the
following conditions is satisfied, the Mortgagee, upon request of the Mortgagor,
shall apply insurance proceeds or condemnation awards received by it to the
restoration or replacement of the Collateral, to the extent necessary for the
restoration or replacement thereof:
(i) there shall then exist no uncured Default of which Mortgagor
has received notice thereof;
(ii) the Mortgagor shall furnish to the Mortgagee a certificate
of an architect or engineer reasonably acceptable to the Mortgagee
stating (x) that the Collateral is capable of
23
being restored, prior to the maturity of the Credit Agreement, to
substantially the same condition as existed prior to the casualty or
Taking, (y) the aggregate estimated direct and indirect costs of such
restoration and (z) as to any Taking, that the property taken in such
Taking, or sold under threat thereof, is not necessary to the
Mortgagor's customary use or occupancy of the Property; and
(iii) in the event that the estimated cost of restoration set
forth in the certificate of such architect or engineer (and such
revisions to such estimate as are from time to time made) exceeds the
net insurance proceeds or condemnation awards actually received from
time to time, the Mortgagor shall deposit the amount of such excess
with the Mortgagee.
In the event that such insurance proceeds or condemnation awards are to be
utilized in the restoration of the Collateral, the Mortgagee shall disburse such
Proceeds and the additional amounts deposited by the Mortgagor for such
restoration after receipt of a written request for disbursement, on not fewer
than five (5) nor more than twelve (12) Business Days notice and, to the extent
applicable, in accordance with the Mortgagee's customary construction loan
procedures and conditions. In the event that such insurance or condemnation
awards are to be utilized to replace the Collateral so destroyed or taken, the
Mortgagee shall disburse such Proceeds after receipt of a written request for
disbursement, on not fewer than five (5) Business Days nor more than twelve (12)
Business Days notice simultaneously with the acquisition of such replacement
property by the Mortgagor. In the event that, after the restoration or
replacement of the Collateral, any insurance or condemnation awards shall
remain, such amount shall be paid to the Mortgagor. Insurance proceeds and
condemnation awards shall be invested in the manner reasonably requested by the
Mortgagor and approved by the Mortgagee, and all interest earned thereon shall
be applied as provided in this SECTION 2.3. If, prior to the receipt by the
Mortgagee of such insurance proceeds or condemnation awards, the Collateral
shall have been sold on foreclosure, the Mortgagee shall have the right to
receive said insurance proceeds or condemnation awards to the extent of any
deficiency found to be due upon such sale, with legal interest thereon, whether
or not a deficiency judgment shall have been sought or recovered or denied, and
the reasonable attorneys' fees, costs and disbursements incurred by the
Mortgagee in connection with the collection of such award or payment.
SECTION 2.4 TOTAL TAKING AND TOTAL DESTRUCTION. In the event of a Total
Destruction or a Total Taking, the
24
Mortgagee shall apply all amounts recovered under any insurance policy referred
to in SECTION 2.1.1 and all awards received by it on account of any such Taking
as follows:
(a) first, to the payment of the reasonable costs and expenses
incurred by the Mortgagee in obtaining any such insurance proceeds or
awards, including the fees and expenses of attorneys and insurance and
other experts and consultants, the costs of litigation, arbitration,
mediation, investigations and other judicial, administrative or other
proceedings and all other out-of-pocket expenses;
(b) second, to the payment of the principal of the Credit Extensions
and any interest (including Post-Petition Interest to the extent such
interest is a Secured Obligation) accrued and unpaid thereon, without
regard to whether any portion or all of such amounts shall be matured or
unmatured, together with interest at the rate provided for in the Credit
Agreement on any overdue principal and (to the extent permitted by
applicable law) interest; and, in case such amount shall be insufficient to
pay in full all such amounts, then such amount shall be applied, FIRST, to
the payment of all amounts of interest (including Post-Petition Interest to
the extent such interest is a Secured Obligation) accrued on the Credit
Extensions and unpaid, and SECOND, to the payment of all amounts of
principal at the time outstanding;
(c) third, to the payment of, or the application to, any Secured
Obligation (other than as provided in CLAUSE (B) above);
(d) fourth, to fulfill any of the other covenants contained herein as
the Mortgagee may determine; and
(e) fifth, the balance, if any, to the Mortgagor.
ARTICLE 3.
EVENTS OF DEFAULT; REMEDIES, ETC.
SECTION 3.1 EVENTS OF DEFAULT; ACCELERATION. If an "Event of Default"
(pursuant to and as defined in the Credit Agreement) shall have occurred, then
and in any such event the Mortgagee may at any time thereafter (unless all
Events of Default shall theretofore have been remedied and all costs and
expenses, including, without limitation, attorneys' fees and expenses incurred
by or on behalf of the Mortgagee, shall have been paid in full by the Mortgagor)
declare, by written notice to the Mortgagor, the Loans and all other Secured
Obligations to be due and payable immediately or on a date specified in such
notice (PROVIDED
25
that, upon the occurrence of any Event of Default described in Section 10.1.9.
of the Credit Agreement, the Loans and all other Secured Obligations shall
automatically become due and payable), and on such date the same shall be and
become due and payable, together with interest accrued thereon, without
presentment, demand, protest or notice, all of which the Mortgagor hereby
waives. The Mortgagor will pay on demand all costs and expenses, including,
without limitation, attorneys' fees and expenses, incurred by or on behalf of
the Mortgagee in enforcing this Mortgage, or any other Loan Document, or
occasioned by any default hereunder or thereunder.
SECTION 3.2 LEGAL PROCEEDINGS; FORECLOSURE. If an Event of Default
shall have occurred, the Mortgagee at any time may, at its election, proceed
at law or in equity or otherwise to enforce the payment and performance of
the Secured Obligations in accordance with the terms hereof and thereof and
to foreclose the lien of this Mortgage as against all or any part of the
Collateral and to have the same sold under the judgment or decree of a court
of competent jurisdiction. The Mortgagee shall be entitled to recover in such
proceedings all costs incident thereto, including attorneys' fees and
expenses in such amounts as may be fixed by the court.
SECTION 3.3 POWER OF SALE. If an Event of Default shall have occurred,
the Mortgagee may grant, bargain, sell, assign, transfer, convey and deliver the
whole or, from time to time, any part of the Collateral, or any interest in any
part thereof, at any private sale or at public auction, with or without demand,
advertisement or notice, for cash, on credit or for other property, for
immediate or future delivery, and for such price or prices and on such terms as
the Mortgagee in its uncontrolled discretion may determine, or as may be
required by law, and upon such sale the Mortgagee may execute and deliver to the
purchaser(s) instruments of conveyance pursuant to the terms hereof and to
applicable laws. Without limiting the authority granted in this SECTION 3.3,
the Mortgagee shall, without demand on the Mortgagor, after the lapse of such
time as may then be required by law, and notice of default and notice of sale
having been given as then required by law, sell the Collateral on the date and
at the time and place designated in the notice of sale, either as a whole or in
separate parcels and in such order as the Mortgagee may determine, but subject
to any statutory right of the Mortgagor to direct the order in which such
property, if consisting of several known lots, parcels or interests, shall be
sold, at public auction to the highest bidder, the purchase price payable in
lawful money of the United States at the time of sale. The Person conducting
the sale may, for any cause deemed expedient, postpone the sale from time to
time until it shall be completed and, in every such case, notice of postponement
shall be given by public declaration thereof by
26
such Person at the time and place last appointed for the sale; PROVIDED THAT, if
the sale is postponed for longer than one (1) day beyond the day designated in
the notice of sale, notice of sale and notice of the time, date and place of
sale shall be given in the same manner as the original notice of sale. The
Mortgagee shall execute and deliver to the purchaser at any such sale a
mortgagee's deed conveying the property so sold, but without any covenant or
warranty, express or implied. The recitals in such mortgagee's deed of any
matters or facts shall be conclusive proof of the truthfulness thereof. Any
Person, including the Mortgagee, may bid at the sale. The Mortgagee shall apply
the proceeds of the sale, to the extent consistent with this Mortgage, to the
payment of (a) the costs and expenses of exercising the power of sale and of the
sale, including the payment of attorneys' fees and costs, (b) the cost of any
evidence of title procured in connection with such sale, (c) all sums expended
under the terms hereof in conjunction with any default provision hereof, not
then repaid, with accrued interest at the rate provided for in the Credit
Agreement from the date of incurrence, (d) outstanding principal and interest
under the Credit Agreement, (e) all Secured Obligations (other than as provided
in CLAUSE (D) above). The Mortgagee shall give the remainder, if any, of the
proceeds of the sale to the Person or Persons legally entitled thereto, or the
Mortgagee, in the Mortgagee's discretion, may deposit the balance of such
proceeds with any court or public official authorized to receive such proceeds.
SECTION 3.4 UNIFORM COMMERCIAL CODE REMEDIES. If an Event of Default
shall have occurred, the Mortgagee may exercise from time to time and at any
time any rights and remedies available to it under applicable law upon default
in the payment of indebtedness, including, without limitation, any right or
remedy available to it as a secured party under the Uniform Commercial Code of
the State. The Mortgagor shall, promptly upon request by the Mortgagee,
assemble the Collateral, or any portion thereof generally described in such
request, and make it available to the Mortgagee at such place or places
designated by the Mortgagee and reasonably convenient to the Mortgagee or the
Mortgagor. If the Mortgagee elects to proceed under the Uniform Commercial Code
of the State to dispose of portions of the Collateral, the Mortgagee, at its
option, may give the Mortgagor notice of the time and place of any public sale
of any such property, or of the date after which any private sale or other
disposition thereof is to be made, by sending notice by registered or certified
first class mail, postage prepaid, to the Mortgagor at least ten (10) days
before the time of the sale or other disposition. If any notice of any proposed
sale, assignment or transfer by the Mortgagee of any portion of the Collateral
or any interest therein is required by law, the Mortgagor conclusively agrees
that ten (10) days notice to the Mortgagor of the
27
date, time and place (and, in the case of a private sale, the terms) thereof is
reasonable.
SECTION 3.5 MORTGAGEE AUTHORIZED TO EXECUTE DEEDS, ETC. The Mortgagor
irrevocably appoints the Mortgagee (which appointment is coupled with an
interest) the true and lawful attorney of the Mortgagor, in its name and stead
and on its behalf, for the purpose of effectuating any sale, assignment,
transfer or delivery for the enforcement hereof, whether pursuant to power of
sale, foreclosure or otherwise, to execute and deliver all such deeds, bills of
sale, assignments, releases and other instruments as may be designated in any
such request.
SECTION 3.6 PURCHASE OF COLLATERAL BY MORTGAGEE. The Mortgagee may be a
purchaser of the Collateral or of any part thereof or of any interest therein at
any sale thereof, whether pursuant to power of sale, foreclosure or otherwise,
and the Mortgagee may apply upon the purchase price thereof the indebtedness
secured hereby owing to the Mortgagee. Such purchaser shall, upon any such
purchase, acquire good title to the properties so purchased, free of the
security interest and lien of this Mortgage and free of all rights of redemption
in the Mortgagor.
SECTION 3.7 RECEIPT A SUFFICIENT DISCHARGE TO PURCHASER. Upon any sale of
the Collateral or any part thereof or any interest therein, whether pursuant to
power of sale, foreclosure or otherwise, the receipt of the Mortgagee or the
officer making the sale under judicial proceedings shall be a sufficient
discharge to the purchaser for the purchase money, and such purchaser shall not
be obliged to see to the application thereof.
SECTION 3.8 WAIVER OF APPRAISEMENT, VALUATION, ETC. The Mortgagor hereby
waives, to the fullest extent it may lawfully do so, the benefit of all
appraisement, valuation, stay, extension and redemption laws now or hereafter in
force and all rights of marshaling in the event of any sale of the Collateral or
any part thereof or any interest therein.
SECTION 3.9 SALE A BAR AGAINST MORTGAGOR. Any sale of the Collateral or
any part thereof or any interest therein under or by virtue of this Mortgage,
whether pursuant to power of sale, foreclosure or otherwise, shall forever be a
bar against the Mortgagor.
SECTION 3.10 SECURED OBLIGATIONS TO BECOME DUE ON SALE. Upon any sale of
the Collateral or any portion thereof or interest therein by virtue of the
exercise of any remedy by the Mortgagee under or by virtue of this Mortgage,
whether pursuant to power of sale, foreclosure or otherwise in accordance with
this Mortgage or by virtue of any other remedy available at law or in equity or
by statute or
28
otherwise, at the option of the Mortgagee, any sums or monies due and payable
pursuant to the Credit Agreement, the Loan Documents and in connection with the
Loans and/or the Secured Obligations shall, if not previously declared due and
payable, immediately become due and payable, together with interest accrued
thereon, and all other indebtedness which this Mortgage by its terms secures.
SECTION 3.11 APPLICATION OF PROCEEDS OF SALE AND OTHER MONEYS. The
proceeds of any sale of the Collateral or any part thereof or any interest
therein under or by virtue of this Mortgage, whether pursuant to power of sale,
foreclosure or otherwise, and all other moneys at any time held by the Mortgagee
as part of the Collateral, shall be applied in such order of priority as the
Mortgagee shall determine in its sole and absolute discretion including, without
limitation, as follows:
(a) first, to the payment of the reasonable costs and expenses of such
sale (including, without limitation, the cost of evidence of title and the
costs and expenses, if any, of taking possession of, retaining custody
over, repairing, managing, operating, maintaining and preserving the
Collateral or any part thereof prior to such sale), all reasonable costs
and expenses incurred by the Mortgagee or any other Person in obtaining or
collecting any insurance proceeds, condemnation awards or other amounts
received by the Mortgagee, all reasonable costs and expenses of any
receiver of the Collateral or any part thereof, and any Impositions or
other charges or expenses prior to the security interest or lien of this
Mortgage, which the Mortgagee may consider it necessary or desirable to
pay;
(b) second, to the payment of any Secured Obligation (other than those
set forth in SECTION 3.11(c) below);
(c) third, to the payment of all amounts of principal of and interest
(including Post-Petition Interest to the extent such interest is a Secured
Obligation) at the time due and payable under the Credit Agreement at the
time outstanding (whether due by reason of maturity or by reason of any
prepayment requirement or by declaration or acceleration or otherwise),
including interest at the rate provided for in the Credit Agreement on any
overdue principal and (to the extent permitted under applicable law) on any
overdue interest; and, in case such moneys shall be insufficient to pay in
full such principal and interest, then, FIRST, to the payment of all
amounts of interest (including Post-Petition Interest to the extent such
interest is a Secured Obligation) at the time due and payable and, SECOND,
to the payment of all
29
amounts of principal at the time due and payable under the Credit
Agreement; and
(d) fourth, the balance, if any, held by the Mortgagee after payment
in full of all amounts referred to in subdivisions SECTIONS 3.11(a), (b)
and (c) above, shall, unless a court of competent jurisdiction may
otherwise direct by final order not subject to appeal, be paid to or upon
the direction of the Mortgagor.
SECTION 3.12 APPOINTMENT OF RECEIVER. If an Event of Default shall have
occurred, the Mortgagee shall, as a matter of right, without notice, and without
regard to the adequacy of any security for the indebtedness secured hereby or
the solvency of the Mortgagor, be entitled to the appointment of a receiver for
all or any part of the Collateral, whether such receivership be incidental to a
proposed sale of the Collateral or otherwise, and the Mortgagor hereby consents
to the appointment of such a receiver and will not oppose any such appointment.
SECTION 3.13 POSSESSION, MANAGEMENT AND INCOME. If an Event of Default
shall have occurred, in addition to, and not in limitation of, the rights and
remedies provided in SECTION 1.14, the Mortgagee, upon five (5) days notice to
the Mortgagor, may enter upon and take possession of the Collateral or any part
thereof by force, summary proceeding, ejectment or otherwise and may remove the
Mortgagor and all other Persons and any and all property therefrom and may hold,
operate, maintain, repair, preserve and manage the same and receive all
earnings, income, Rents, issues and Proceeds accruing with respect thereto or
any part thereof. The Mortgagee shall be under no liability for or by reason of
any such taking of possession, entry, removal or holding, operation or
management, except that any amounts so received by the Mortgagee shall be
applied to pay all costs and expenses of so entering upon, taking possession of,
holding, operating, maintaining, repairing, preserving and managing the
Collateral or any part thereof, and any Impositions or other charges prior to
the lien and security interest of this Mortgage which the Mortgagee may consider
it necessary or desirable to pay, and any balance of such amounts shall be
applied as provided in SECTION 3.11.
SECTION 3.14 RIGHT OF MORTGAGEE TO PERFORM MORTGAGOR'S COVENANTS, ETC. If
the Mortgagor shall fail to make any payment or perform any act required to be
made or performed hereunder or under the Credit Agreement or any other Loan
Document, the Mortgagee, subject to twenty (20) days' prior written notice to
the Mortgagor (except that no prior notice shall be required in the case of an
emergency or where the failure to make such payment or perform such obligation
could affect the priority of the lien of this Mortgage) without waiving or
releasing any obligation or Default, may (but shall be under no obligation to)
at any time thereafter
30
make such payment or perform such act for the account and at the expense of the
Mortgagor, and may enter upon the Collateral for such purpose and take all such
action thereon as, in the Mortgagee's opinion, may be necessary or appropriate
therefor. No such entry and no such action shall be deemed an eviction of any
lessee of the Property or any part thereof. All sums so paid by the Mortgagee
and all costs and expenses (including, without limitation, attorneys' fees and
expenses) so incurred, together with interest thereon at the rate provided for
in Section 5.2.2. of the Credit Agreement from the date of payment or incurring,
shall constitute additional indebtedness under the Credit Agreement secured by
this Mortgage and shall be paid by the Mortgagor to the Mortgagee on demand.
SECTION 3.15 SUBROGATION. To the extent that the Mortgagee, on or after
the date hereof, pays any sum due under any provision of any Legal Requirement
or any instrument creating any lien prior or superior to the lien of this
Mortgage, or the Mortgagor or any other Person pays any such sum with the
proceeds of the loan evidenced by the Credit Agreement, the Mortgagee shall have
and be entitled to a lien on the Collateral equal in priority to the lien
discharged, and the Mortgagee shall be subrogated to, and receive and enjoy all
rights and liens possessed, held or enjoyed by, the holder of such lien, which
shall remain in existence and benefit the Mortgagee in securing the Secured
Obligations.
SECTION 3.16 REMEDIES, ETC., CUMULATIVE. Each right, power and remedy of
the Mortgagee provided for in this Mortgage, the Credit Agreement or any other
Loan Document, or now or hereafter existing at law or in equity or by statute or
otherwise shall be cumulative and concurrent and shall be in addition to every
other right, power or remedy provided for in this Mortgage, the Credit Agreement
or any other Loan Document, or now or hereafter existing at law or in equity or
by statute or otherwise, and the exercise or beginning of the exercise by the
Mortgagee of any one or more of the rights, powers or remedies provided for in
this Mortgage, the Credit Agreement, or any other Loan Document, or now or
hereafter existing at law or in equity or by statute or otherwise shall not
preclude the simultaneous or later exercise by the Mortgagee of any or all such
other rights, powers or remedies.
SECTION 3.17 PROVISIONS SUBJECT TO APPLICABLE LAW. All rights, powers and
remedies provided in this Mortgage may be exercised only to the extent that the
exercise thereof does not violate any applicable provisions of law and are
intended to be limited to the extent necessary so that they will not render this
Mortgage invalid, unenforceable or not entitled to be recorded, registered or
filed under the provisions of any applicable law. If any term of this Mortgage
or any application thereof shall be
31
invalid or unenforceable, the remainder of this Mortgage and any other
application of such term shall not be affected thereby.
SECTION 3.18 NO WAIVER, ETC. No failure by the Mortgagee to insist upon
the strict performance of any term hereof or of the Credit Agreement, or of any
other Loan Document, or to exercise any right, power or remedy consequent upon a
breach hereof or thereof, shall constitute a waiver of any such term or of any
such breach. No waiver of any breach shall affect or alter this Mortgage, which
shall continue in full force and effect with respect to any other then existing
or subsequent breach. By accepting payment or performance of any amount or
other Secured Obligations secured hereby before or after its due date, the
Mortgagee shall not be deemed to have waived its right either to require prompt
payment or performance when due of all other amounts and Secured Obligations
payable hereunder or to declare a default for failure to effect such prompt
payment.
SECTION 3.19 COMPROMISE OF ACTIONS, ETC. Any action, suit or proceeding
brought by the Mortgagee pursuant to any of the terms of this Mortgage, the
Credit Agreement, any other Loan Document, or otherwise, and any claim made by
the Mortgagee hereunder or thereunder, may be compromised, withdrawn or
otherwise dealt with by the Mortgagee without any notice to or approval of the
Mortgagor.
ARTICLE 4.
DEFINITIONS
SECTION 4.1 TERMS DEFINED IN THIS MORTGAGE. When used herein the
following terms have the following meanings:
"AGENT" shall have the meaning set forth in the PREAMBLE.
"ASSUMPTION" shall have the meaning set forth in the FOURTH RECITAL.
"BORROWERS" shall have the meaning set forth in the SECOND RECITAL.
"BORROWING" shall have the meaning set forth in the Credit Agreement.
"CANADIAN AGENT" shall have the meaning set forth in the Credit Agreement.
"CANADIAN BORROWER" shall have the meaning set forth in the SECOND RECITAL.
32
"CANADIAN FACILITY" shall have the meaning set forth in the Credit
Agreement.
"CANADIAN ISSUERS" shall have the meaning set forth in the Credit
Agreement.
"CANADIAN LENDERS" shall have the meaning set forth in the Credit
Agreement.
"CANADIAN LETTER OF CREDIT" shall have the meaning set forth in the Credit
Agreement.
"CANADIAN LETTER OF CREDIT OUTSTANDINGS" shall have the meaning set forth
in the Credit Agreement.
"CANADIAN REVOLVING LOAN" shall have the meaning set forth in the Credit
Agreement.
"CANADIAN REVOLVING LOAN COMMITMENT" shall have the meaning set forth in
the Credit Agreement.
"CANADIAN REVOLVING LOAN COMMITMENT AMOUNT" shall have the meaning set
forth in the Credit Agreement.
"CANADIAN REVOLVING LOAN COMMITMENT TERMINATION DATE" shall have the
meaning set forth in the Credit Agreement.
"CANADIAN SUBSIDIARY" shall have the meaning set forth in the Credit
Agreement.
"CANADIAN SWING LINE LENDER" shall have the meaning set forth in the Credit
Agreement.
"CANADIAN SWING LINE LOAN" shall have the meaning set forth in the Credit
Agreement.
"CANADIAN SWING LINE LOAN COMMITMENT" shall have the meaning set forth in
the Credit Agreement.
"CDN $" shall have the meaning set forth in the Credit Agreement.
"COLLATERAL" shall have the meaning set forth in the GRANTING CLAUSE.
"COMMITMENT" shall have the meaning set forth in the Credit Agreement.
"CONTRACTS" shall have the meaning set forth in CLAUSE (h) of the GRANTING
CLAUSE.
"CREDIT AGREEMENT" shall have the meaning set forth in the SECOND RECITAL.
33
"CREDIT EXTENSIONS" shall have the meaning set forth in the the SECOND
RECITAL.
"DEFAULT" means any Event of Default or any condition or event which, after
notice or lapse of time, or both, would constitute an Event of Default.
"ENVIRONMENTAL, HEALTH OR SAFETY REQUIREMENTS OF LAW" means all valid and
enforceable Requirements of Law derived from or relating to federal, state
and local laws or regulations relating to or addressing the environment,
health or safety, including but not limited to any law, regulation, or order
relating to the use, handling, or disposal of any Hazardous Material, any
law, regulation, or order relating to Remedial Action, and any law,
regulation, or order relating to workplace or worker safety and health, as
such Requirements of Law are promulgated by the specifically authorized
agency responsible for administering such Requirements of Law.
"EVENT OF DEFAULT" shall have the meaning set forth in the Credit
Agreement.
"GOODS" shall have the meaning set forth in CLAUSE (c) of the GRANTING
CLAUSE.
"HAZARDOUS MATERIAL" shall have the meaning set forth in the Credit
Agreement.
"HEREIN", "HEREOF", "HERETO", and "HEREUNDER" and similar terms refer to
this Mortgage and not to any particular Section, paragraph or provision of this
Mortgage.
"IMPOSITIONS" shall have the meaning set forth in SECTION 1.5.
"IMPROVEMENTS" shall have the meaning set forth in CLAUSE (b) of the
GRANTING CLAUSE.
"INDEMNIFIED PARTIES" shall have the meaning set forth in SECTION 1.16.
"INSURANCE REQUIREMENTS" shall have the meaning set forth in PARAGRAPH (a)
of SECTION 1.6.
"INTANGIBLES" shall have the meaning set forth in CLAUSE (d) of the
GRANTING CLAUSE.
"ISSUER" shall have the meaning set forth in the Credit Agreement.
"LAND" shall have the meaning set forth in the FIRST RECITAL.
34
"LEASES" shall have the meaning set forth in CLAUSE (e) of the GRANTING
CLAUSE.
"LEINER" shall have the meaning set forth in the PREAMBLE.
"LEGAL REQUIREMENTS" shall have the meaning set forth in PARAGRAPH (b) of
SECTION 1.6.
"LENDERS" shall have the meaning set forth in the Credit Agreement.
"LETTER OF CREDIT" shall have the meaning set forth in the Credit
Agreement.
"LHPG" shall have the meaning set forth in the PREAMBLE.
"LOAN DOCUMENTS" shall have the meaning set forth in the Credit Agreement.
"LOANS" shall have the meaning set forth in the Credit Agreement.
"MORTGAGE" shall have the meaning set forth in the PREAMBLE.
"MORTGAGEE" shall have the meaning set forth in the PREAMBLE.
"MORTGAGOR" shall have the meaning set forth in the PREAMBLE.
"NOTES" shall have the meaning set forth in the Credit Agreement.
"OBLIGATIONS" shall have the meaning set forth in the Credit Agreement.
"OBLIGOR" shall mean each Person having any liabilities, obligations,
duties or responsibilities under the Credit Agreement or any Loan Document.
"PERMITS" shall have the meaning set forth in CLAUSE (g) of the GRANTING
CLAUSE.
"PERMITTED ENCUMBRANCES" shall have the meaning set forth in SECTION 1.2.
"PERSON" means a corporation, an association, a partnership, an
organization, a business, an individual, a government or political
subdivision thereof or a governmental agency or officer.
35
"PLANS" shall have the meaning set forth in CLAUSE (f) of the GRANTING
CLAUSE.
"POST-PETITION INTEREST" shall have the meaning set forth in SECTION 2.3.
"PROCEEDS" shall have the meaning set forth in CLAUSE (k) of the GRANTING
CLAUSE.
"PROPERTY" shall have the meaning set forth in CLAUSE (b) of the GRANTING
CLAUSE.
"REAL ESTATE" shall have the meaning set forth in CLAUSE (a) of the
GRANTING CLAUSE.
"RELEASE" means release, spill, emission, leaking, pumping, injection,
deposit, disposal, discharge, dispersal, leaching or migration into the
indoor or outdoor environment or into or out of any Property, including the
movement of Hazardous Material through or in the air, soil, surface water,
groundwater or Property.
"REMEDIAL ACTION" means actions required to (i) clean up, remove, treat
or in any other way address Hazardous Material in the indoor or outdoor
environment; (ii) prevent the Release or threat of Release or minimize the
further Release of Hazardous Material; or (iii) investigate and determine if
a remedial response is needed and to design such a response and post-remedial
investigation, monitoring, operation and maintenance and care.
"RENTS" shall have the meaning set forth in CLAUSE (j) of the GRANTING
CLAUSE.
"REVOLVING LOAN" shall have the meaning set forth in the Credit Agreement.
"SCOTIABANK" shall have the meaning set forth in the SECOND RECITAL.
"SECURED OBLIGATIONS" means all Obligations now or hereafter existing
under the Credit Agreement, and all obligations (monetary or otherwise)
arising under or in connection with the Notes and each other Loan Document,
whether for principal, interest, costs, fees, expenses or otherwise, and all
other obligations of the Mortgagor and each Obligor under any Loan Document,
including, without limitation, any Subsidiary Guaranty, howsoever created,
arising or now or hereafter existing or due or to become due.
"STATE" means the State of Illinois.
36
"STATED AMOUNT" shall have the meaning set forth in the Credit Agreement.
"SUBSIDIARY GUARANTY" shall have the meaning set forth in the Credit
Agreement.
"TAKING" shall have the meaning set forth in CLAUSE (b) of SECTION 2.2.
"TERM LOAN" shall have the meaning set forth in the Credit Agreement.
"TERM B LOAN" shall have the meaning set forth in the Credit Agreement.
"TERM B LOAN COMMITMENT" shall have the meaning set forth in the Credit
Agreement.
"TERM C LOAN" shall have the meaning set forth in the Credit Agreement.
"TERM C LOAN COMMITMENT" shall have the meaning set forth in the Credit
Agreement.
"TOTAL DESTRUCTION" means any damage to or destruction of the
Improvements or any part thereof which, in the reasonable estimation of the
Mortgagee shall require the expenditure of an amount in excess of fifty
percent (50%) of the replacement value of the Property to restore the
Improvements to substantially the same condition of the Improvements
immediately prior to such damage or destruction.
"TOTAL TAKING" means a Taking, whether permanent or for temporary use,
which, in the good faith judgment of the Mortgagee, shall substantially
interfere with the normal operation of the Property by the Mortgagor.
"U.S. AGENT" shall have the meaning set forth in the Credit Agreement.
"U.S. BORROWER" shall have the meaning set forth in the SECOND RECITAL.
"U.S. FACILITY" shall have the meaning set forth in the Credit Agreement.
"U.S. ISSUERS" shall have the meaning set forth in the Credit Agreement.
"U.S. LENDERS" shall have the meaning set forth in the Credit Agreement.
37
"U.S. LETTER OF CREDIT" shall have the meaning set forth in the Credit
Agreement.
"U.S. LETTER OF CREDIT OUTSTANDINGS" shall have the meaning set forth in
the Credit Agreement.
"U.S. REVOLVING LOAN" shall have the meaning set forth in the Credit
Agreement.
"U.S. REVOLVING LOAN COMMITMENT" shall have the meaning set forth in the
Credit Agreement.
"U.S. REVOLVING LOAN COMMITMENT AMOUNT" shall have the meaning set forth in
the Credit Agreement.
"U.S. REVOLVING LOAN COMMITMENT TERMINATION DATE" shall have the meaning
set forth in the Credit Agreement.
"U.S. RL LENDERS" shall have the meaning set forth in the Credit Agreement.
"U.S. SUBSIDIARY" shall have the meaning set forth in the Credit Agreement.
"U.S. SWING LINE LENDER" shall have the meaning set forth in the Credit
Agreement.
"U.S. SWING LINE LOAN" shall have the meaning set forth in the Credit
Agreement.
SECTION 4.2 USE OF DEFINED TERMS. Terms for which meanings are provided
in this Mortgage shall, unless otherwise defined or the context otherwise
requires, have such meanings when used in any certificate and any opinion,
notice or other communication delivered from time to time in connection with
this Mortgage or pursuant hereto.
SECTION 4.3 CREDIT AGREEMENT DEFINITIONS. Unless otherwise defined
herein or the context otherwise requires, terms used in this Mortgage,
including its preamble and recitals, have the meanings provided in the Credit
Agreement.
ARTICLE 5.
MISCELLANEOUS
-------------
SECTION 5.1 FURTHER ASSURANCES; FINANCING STATEMENTS.
SECTION 5.1.1 FURTHER ASSURANCES. The Mortgagor, at its expense, will
execute, acknowledge and deliver all such instruments and take all such other
action as the Mortgagee from time to time may reasonably request:
38
(a) to better subject to the lien and security interest of this
Mortgage all or any portion of the Collateral,
(b) to perfect, publish notice or protect the validity of the lien and
security interest of this Mortgage,
(c) to preserve and defend the title to the Collateral and the rights
of the Mortgagee therein against the claims of all Persons as long as this
Mortgage shall remain undischarged,
(d) to better subject to the lien and security interest of this
Mortgage or to maintain or preserve the lien and security interest of this
Mortgage with respect to any replacement or substitution for any Collateral
or any other after-acquired property, or
(e) in order to further effectuate the purposes of this Mortgage and
to carry out the terms hereof and to better assure and confirm to the
Mortgagee its rights, powers and remedies hereunder.
SECTION 5.1.2 FINANCING STATEMENTS. Notwithstanding any other provision
of this Mortgage, the Mortgagor hereby agrees that, without notice to or the
consent of the Mortgagor, the Mortgagee may file with the appropriate public
officials such financing statements, continuation statements, amendments and
similar documents as are or may become necessary to perfect, preserve or
protect the security interest granted by this Mortgage.
SECTION 5.2 ADDITIONAL SECURITY. Without notice to or consent of the
Mortgagor, and without impairment of the security interest and lien and
rights created by this Mortgage, the Mortgagee and the Lenders may accept
from the Mortgagor or any other Person additional security for the Secured
Obligations. Neither the giving of this Mortgage nor the acceptance of any
such additional security shall prevent the Mortgagee from resorting, first,
to such additional security, or, first, to the security created by this
Mortgage, or concurrently to both, in any case without affecting the
Mortgagee's lien and rights under this Mortgage.
SECTION 5.3 DEFEASANCE; PARTIAL RELEASE, ETC.
SECTION 5.3.1 DEFEASANCE. If the Loans and all other amounts owing
pursuant to the Credit Agreement and the other Loan Documents shall be repaid
in full in accordance with the terms thereof, and if the Mortgagor shall pay,
in full, the principal of and premium, if any, and interest on the Secured
Obligations in accordance with the terms thereof and hereof and all other
sums payable hereunder by the Mortgagor
39
and shall comply with all the terms, conditions and requirements hereof and
of the Secured Obligations which by their nature are capable of being
complied with during the term hereof, then on such date, the Mortgagee shall,
upon the request of the Mortgagor and at the Mortgagor's sole cost and
expense, execute and deliver such instruments, in form and substance
reasonably satisfactory to the Mortgagee, as may be necessary to reconvey,
release and discharge this Mortgage.
SECTION 5.3.2 PARTIAL RELEASE, ETC. The Mortgagee may, at any time and
from time to time, without liability therefor, and without prior notice to
the Mortgagor, release or reconvey any part of the Collateral, consent to the
making of any map or plat of the Property, join in granting any easement
thereon or join in any extension agreement or agreement subordinating the
lien of this Mortgage, or enter into any other agreement in connection with
the Collateral.
SECTION 5.4 NOTICES, ETC. All notices and other communications provided
to any of the parties hereto shall be in writing and addressed, delivered or
transmitted to such party as set forth in the Credit Agreement.
SECTION 5.5 WAIVERS, AMENDMENTS, ETC. The provisions of this Mortgage
may be amended, discharged or terminated and the observance or performance of
any provision of this Mortgage may be waived, either generally or in a
particular instance and either retroactively or prospectively, only by an
instrument in writing executed by the Mortgagor and the Mortgagee.
SECTION 5.6 CROSS-REFERENCES. References in this Mortgage and in each
instrument executed pursuant hereto to any Section or Article are, unless
otherwise specified, to such Section or Article of this Mortgage or such
instrument, as the case may be, and references in any Section, Article or
definition to any clause are, unless otherwise specified, to such clause of
such Section, Article or definition.
SECTION 5.7 HEADINGS. The various headings of this Mortgage and of each
instrument executed pursuant hereto are inserted for convenience only and
shall not affect the meaning or interpretation of this Mortgage or such
instrument or any provisions hereof or thereof.
SECTION 5.8 CURRENCY. Unless otherwise expressly stated, all references
to any currency or money, or any dollar amount, or amounts denominated in
"Dollars" herein will be deemed to refer to the lawful currency of the United
States.
SECTION 5.9 GOVERNING LAW. THIS MORTGAGE SHALL BE DEEMED TO BE A
CONTRACT MADE UNDER AND GOVERNED BY THE LAWS OF THE STATE.
40
SECTION 5.10 SUCCESSORS AND ASSIGNS, ETC. This Mortgage shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns.
SECTION 5.11 WAIVER OF JURY TRIAL; SUBMISSION TO JURISDICTION.
(a) EACH OF THE MORTGAGOR AND THE MORTGAGEE HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION BASED HEREON OR ARISING OUT OF, UNDER OR
IN CONNECTION WITH THIS MORTGAGE, THE CREDIT AGREEMENT, ANY LOAN DOCUMENT
OR ANY OTHER RELATED INSTRUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN), OR ACTIONS OF THE MORTGAGOR
OR THE MORTGAGEE. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE
MORTGAGEE AND THE LENDERS TO ENTER INTO THE TRANSACTIONS PROVIDED FOR IN
THE CREDIT AGREEMENT AND TO MAKE THE CREDIT EXTENSIONS.
(b) FOR THE PURPOSE OF ANY ACTION OR PROCEEDING INVOLVING THIS
MORTGAGE, THE CREDIT AGREEMENT OR ANY OTHER LOAN DOCUMENT, THE MORTGAGOR
HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION
OF ALL FEDERAL AND STATE COURTS LOCATED IN THE STATE AND CONSENTS THAT IT
MAY BE SERVED WITH ANY PROCESS OR PAPER BY REGISTERED MAIL OR BY PERSONAL
SERVICE WITHIN OR WITHOUT THE STATE IN ACCORDANCE WITH APPLICABLE LAW,
PROVIDED A REASONABLE TIME FOR APPEARANCE IS ALLOWED. THE MORTGAGOR
EXPRESSLY WAIVES, TO THE EXTENT IT MAY LAWFULLY DO SO, ANY OBJECTION, CLAIM
OR DEFENSE WHICH IT MAY HAVE AT ANY TIME TO THE LAYING OF VENUE OF ANY
ACTION, SUIT OR PROCEEDING ARISING OUT OF THIS MORTGAGE, THE CREDIT
AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY SUCH COURT, IRREVOCABLY WAIVES
ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH
COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM AND FURTHER IRREVOCABLY
WAIVES THE RIGHT TO OBJECT, WITH RESPECT TO ANY SUCH CLAIM, SUIT, ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT, THAT SUCH COURT DOES NOT HAVE
JURISDICTION OVER THE PERSON OF THE MORTGAGOR. NOTHING CONTAINED HEREIN
WILL BE DEEMED TO PRECLUDE THE MORTGAGEE FROM BRINGING AN ACTION AGAINST
THE MORTGAGOR IN ANY OTHER JURISDICTION.
SECTION 5.12 SEVERABILITY. Any provision of this Mortgage, the Credit
Agreement or any other Loan Document which is prohibited or unenforceable in
any jurisdiction shall as to such provision and such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Mortgage, the Credit Agreement
or such Loan Document or affecting the validity or enforceability of such
provision in any other jurisdiction.
41
SECTION 5.13 LOAN DOCUMENT. This Mortgage is a Loan Document executed
pursuant to the Credit Agreement and, unless otherwise expressly indicated
herein, shall be construed, administered and applied in accordance with the
terms and provisions thereof.
SECTION 5.14 USURY SAVINGS CLAUSE. It is the intention of the Mortgagor
and the Mortgagee to conform strictly to the usury laws governing the Loan
Documents, and any interest payable under the Loan Documents shall be subject
to reduction to the amount not in excess of the maximum non-usurious amount
allowed under such laws, as construed by the courts having jurisdiction over
such matters. In the event the maturity of the Secured Obligations is
accelerated by reason of any provision of the Loan Documents, or by reason of
an election by the Mortgagee resulting from an Event of Default, then earned
interest may never include more than the maximum amount permitted by law,
computed from the dates of each advance of loan proceeds under the Credit
Agreement until payment, and any interest in excess of the maximum amount
permitted by law shall be canceled automatically or, if theretofore paid, at
the option of the Mortgagee, shall be rebated to the Mortgagor, or shall be
credited on the principal amount of the Secured Obligations or, if all
principal has been repaid, then the excess shall be rebated to the Mortgagor.
If any interest is canceled, credited against principal or rebated to the
Mortgagor in accordance with the foregoing sentence and, if thereafter the
interest payable hereunder is less than the maximum amount permitted by
applicable law, the rate hereunder shall automatically be increased to the
maximum extent possible to permit repayment to the Mortgagee and the Lenders
as soon as possible of any interest in excess of the maximum amount permitted
by law which was earlier canceled, credited against principal or rebated to
the Mortgagor pursuant to the provisions of the foregoing sentence.
SECTION 5.15 FUTURE ADVANCES. Any and all future advances under this
Mortgage and the Loan Documents shall have the same priority as if the future
advance was made on the date that this Mortgage was recorded. This Mortgage
shall secure the Secured Obligations, whenever incurred, such Secured
Obligations to be due at the times provided in the Loan Documents. Notice is
hereby given that the Secured Obligations may INCREASE as a result of any
defaults hereunder by Mortgagor due to, for example, and without limitation,
unpaid interest or late charges, unpaid taxes or insurance premiums which the
Mortgagee elects to advance, defaults under leases that the Mortgagee elects
to cure, attorney fees or costs incurred in enforcing the Loan Documents or
other expenses incurred by the Mortgagee in protecting the Collateral, the
security of this Mortgage or the Mortgagee's rights and interests.
42
IN WITNESS WHEREOF, the Mortgagor has caused this Mortgage to be duly
executed as of the day and year first above written.
MORTGAGOR:
LEINER HEALTH PRODUCTS INC.,
a Delaware corporation
By: /s/ William B. Towne
-----------------------------
Name: William B. Towne
Title: Executive Vice President - Finance
DRAFTED BY:
Mayer, Brown & Platt
1675 Broadway
New York, New York 10019
Attention: Kenneth R. Kleiner, Esq.
43
ACKNOWLEDGMENT OF MORTGAGOR
STATE OF New York )
)ss
COUNTY OF New York)
On this 27thday of June, 1997, before me, the undersigned
officer, personally appeared William Towne personally known and acknowledged
himself/herself (or proved to me on the basis of satisfactory evidence) to be
the Exec VP of Leiner Health Products Inc. (hereinafter, the "Corporation"),
and that as such officer, being duly authorized to do so pursuant to its
bylaws or a resolution of its board of directors, executed, subscribed and
acknowledged the foregoing instrument for the purposes therein contained, by
signing the name of the Corporation by himself/herself in his/her authorized
capacity as such officer as his/her free and voluntary act and deed and the
free and voluntary act and deed of said corporation.
In Witness Whereof, I hereunto set my hand and official seal.
/s/ Caron F. Gelineau
--------------------------------
Notary Public
Notarial Seal My Commission Expires
Caron F. Gelineau
Notary Public, State of New York
No. 31-5009056
Qualified in New York County
Commission Expires March 8, 1999
44
SCHEDULE 1
LEGAL DESCRIPTION OF THE LAND
(attached hereto)
P.I.N. : 1. 19-11-200-007
2. 19-11-200-034
3. 19-11-200-036
Street Address : 3532 West 47th Place
Chicago, Illinois 60632
Parcel 1: The North 410 feet of that part lying South of the South line of West
47th Street (a 66 foot public street) and West of the West line of South St.
Louis Avenue (a 66 foot street now vacated) of Block 7 of James H. Rees'
Subdivision of the Northeast 1/4 of Section 11, Township 38 North, Range 13,
East of the Third Principal Meridian, in Cook County, Illinois.
Parcel 2:
Easement for the construction, maintenance, operation and renewal beneath the
surface of the ground of high and low water pressure water mains for supplying
water for sprinkler service hydrants, and domestic purposes, with the rights to
construct, maintain, operate, and renew underneath the surface of the ground,
concrete or brick vaults (with covered manhole openings at the surface) to house
gate valves, meters, controls, and other water devices; and with the right to
construct, maintain, renew and operate above the surface of the ground fire
hydrants for the benefit of Parcel 1 above, as granted and created by instrument
from W. Wood Prince and James F. Donovan, not as individuals but as Trustees of
the Central Manufacturing District under an Indenture and Declaration of Trust
dated February 1, 1916, and recorded in the office of the Recorder of Deeds of
Cook County, Illinois in Book 13717 of Records at Page 253, as Document Number
5814222 to Benefit Realty Company, an Illinois corporation, dated June 30, 1977
and recorded July 25, 1977 as Document 24025706 and filed in the office of the
Registrar of Titles on December 30, 1977 as Document LR2990769 over, under, on
and upon the following described parcels of land:
Easement 2: The West 18 feet of the South 10 feet of the North 149 feet of that
part of South St. Louis Avenue (a 66 foot private street) lying South of the
South line of West 47th Street (a 66 foot public street) in Block 7 of James H.
Rees' Subdivision of the Northeast 1/4 of Section 11, Township 38 North, Range
13 East of the Third Principal Meridian, in Cook County, Illinois.
Easement 4: The South 10 feet of the North 24.67 feet of the West 242 feet of
the East 396 feet of that part of West 47th Place (a 60 foot private street)
lying West of the West line of South St. Louis Avenue (a 66 foot private
street); also the North 14.67 feet of the West 10 feet of the East 164 feet of
part of West 47th Place lying West of the West line of South St. Louis Avenue;
also the North 14.67 feet of the West 10 feet of the East 361 West 47th Place
lying West of the West line of said South St. Louis Avenue also the North 14.67
feet of the West 10 feet of the East 396 feet of said part of West 47th Place
lying West of the West line of said South St. Louis Avenue; being in Block 7 and
in the EastBlock 8 of James H. Rees' Subdivision of the Northeast 1/4 of Section
11, Township 38 North, Range 13, East of the Third Principal Meridian, in Cook
County, Illinois.
Parcel 1 also known as:
Lots 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, and that part of Lot
17 falling in the North 410 feet South of the South line of 47th Street of Block
7, in the Subdivision of the WestBlock 7 of James H. Rees' Subdivision of the
Northeast 1/4 of Section 11, Township 38 North, Range 13 East of the Third
Principal Meridian, in Cook County, Illinois.
45
SCHEDULE 2
PERMITTED ENCUMBRANCES
----------------------
Those exceptions to title listed
in Lawyers Title Insurance Corporation
marked-up commitment # 97-04952 dated June 30, 1997.
46
LEINER HEALTH PRODUCTS INC.,
Mortgagor,
to
THE BANK OF NOVA SCOTIA,
as agent,
Mortgagee
--------------------------------------------
FIRST AMENDMENT TO
MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FIXTURE FILING
--------------------------------------------
Dated as of July 31, 1997
This instrument affects certain real and personal property
located in Cook County, State of Illinois
--------------------------------------------
Record and return to:
Mayer, Brown & Platt
1675 Broadway
New York, New York 10019
Attention: Kenneth R. Kleiner, Esq.
This instrument was prepared by the above-named attorney
FIRST AMENDMENT TO
MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FIXTURE FILING
FIRST AMENDMENT TO MORTGAGE, ASSIGNMENT OF LEASES AND
RENTS, SECURITY AGREEMENT AND FIXTURE FILING, dated as of July 31, 1997 (this
"FIRST AMENDMENT TO MORTGAGE"), made by LEINER HEALTH PRODUCTS INC., a
Delaware corporation (the "MORTGAGOR"), having an address at 901 East 233rd
Street, Carson, California 90745 to THE BANK OF NOVA SCOTIA, having an
address at One Liberty Plaza, New York, New York 10006, for itself as a
Lender and as collateral agent for the various commercial lending
institutions (collectively, the "LENDERS") which are, or may from time to
time hereafter become, parties to the Credit Agreement, as hereinafter
defined (herein together with its successors and assigns from time to time
acting as collateral agent under such Credit Agreement, the "MORTGAGEE").
W I T N E S S E T H T H A T:
- - - - - - - - - - - - - -
WHEREAS, the Mortgagor is on the date of delivery hereof
the owner of fee title to the parcel of land described in SCHEDULE 1 hereto
(the "LAND") and of the improvements thereon;
WHEREAS, the Mortgagor, the Lenders and the collateral
agent named therein were parties to that certain credit agreement (the
"CREDIT AGREEMENT") dated as of June 30, 1997;
WHEREAS, to partially secure the Mortgagor's obligations
under the Credit Agreement, the Mortgagor executed and delivered to
Mortgagee, as collateral agent for the Lenders, that certain Mortgage,
Assignment of Leases and Rents, Security Agreement and Fixture Filing dated
as of June 30, 1997, pursuant to which the Mortgagor granted, mortgaged, and
conveyed unto Mortgagee, as collateral agent for the Lenders, and its
successors and assigns a first mortgage lien and first priority security
interest in and to the Collateral (as defined therein), all as set forth and
subject to the terms of the Mortgage;
WHEREAS, the Mortgage was recorded in the Office of the
Recorder of Deeds of Cook County, State of Illinois, as Document Number
97492971 and recorded on July 9, 1997;
WHEREAS, the Mortgagor and Mortgagee entered into an
Undertaking Agreement dated as of June 30, 1997, pursuant to which the
Mortgagor undertook to deliver to the Mortgagee an amendment to the Mortgage
which would modify the legal description of the Land, together with the
improvements thereon, that secures the Mortgage; and
WHEREAS, the Mortgagor has duly authorized the execution,
delivery and performance of this First Amendment to Mortgage.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein contained and other good and valuable consideration
given by the Mortgagee to the Mortgagor, the receipt and sufficiency of which
are hereby acknowledged, the Mortgagor and the Mortgagee agree that, from and
after the date hereof, the Mortgage (including the recitals therein) be and
the same hereby is, amended as follows:
1. SCHEDULES I AND 2 to the Mortgage (copies of which are
attached hereto and made a part hereof) are hereby deleted in their entirety
and are replaced by SCHEDULES 3 AND 4 hereto (copies of which are annexed
hereto and made a part hereof).
2. This First Amendment to Mortgage shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
3. Except as amended pursuant to the terms of this First
Amendment to Mortgage, all of the terms, provisions and conditions of the
Mortgage shall remain in full force and effect and are hereby ratified and
confirmed.
IN WITNESS WHEREOF, the Mortgagor has caused this First
Amendment to Mortgage to be duly executed as of the day and year first above
written.
MORTGAGOR:
LEINER HEALTH PRODUCTS INC.,
a Delaware corporation
[Corporate Seal] By /s/ William B. Towne
-------------------------------------
Name: William B. Towne
Title:
2
Accepted and agreed:
MORTGAGEE:
THE BANK OF NOVA SCOTIA, as agent
By /s/ Terry Fryett
-------------------------------------
Name: Terry Fryett
Title:
20446280.01
3
ACKNOWLEDGMENT
State of California
County of Los Angeles
On July 25, 1997 before Sharen Page Notary Public personally
appeared William B. Towne, personally known to me to be the person whose name is
subscribed to the within instrument and acknowledged to me that he executed the
same in his authorized capacity, and that by his signature on the instrument the
person, or the entity upon behalf of which the person acted, executed the
instrument.
WITNESS my hand and official seal.
/s/ Sharen Page
--------------------------------
Signature of Notary Public
4
ACKNOWLEDGMENT OF MORTGAGEE
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On this 30th day of July, 1997, before me, the undersigned
officer, personally appeared Terry Fryett, personally known and acknowledged
himself to me to be a Unit Head of The Bank of Nova Scotia, and that as such
officer, being duly authorized to do so pursuant to its bylaws or a resolution
of its board of directors, executed and acknowledged the foregoing instrument
for the purposes therein contained, by signing the name of the Canadian
chartered bank by himself/herself as such officer as his/her free and voluntary
act and deed and the free and voluntary act and deed of said Canadian chartered
bank.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ Joan D'addario
------------------------------------
Notary Public
Dec. 31, 1998
------------------------------------
My Commission Expires:
Notary Seal:
JOAN D'ADDARIO
Notary Public, State of New York
No. 4758211, Qualified in Suffolk
County Ceritificate Filed in New
York County Commission Expires Dec.
31, 1998
5
SCHEDULE 1
OLD DESCRIPTION OF THE LAND
---------------------------
(see attached)
P.I.N.: 1. 19-11-200-007
2. 19-11-200-034
3. 19-11-200-036
Street Address: 3532 West 47th Place
Chicago, IL 60632
Parcel 1: The North 410 feet of that part lying South of the South line of West
47th Street (a 66 foot public street) and West of the West line of South St.
Louis Avenue (a 66 foot street now vacated) of Block 7 of James H. Rees'
Subdivision of the Northeast 1/4 of Section 11, Township 38 North, Range 13,
East of the Third Principal
Meridian, in Cook County, Illinois.
Parcel 2:
Easement for the construction, maintenance, operation and renewal beneath the
surface of the ground of high and low water pressure water mains for supplying
water for sprinkler service hydrants, and domestic purposes, with the rights to
construct, maintain, operate, and renew underneath the surface of the ground,
concrete or brick vaults (with covered manhole openings at the surface) to house
gate valves, meters, controls, and other water devices; and with the right to
construct, maintain, renew and operate above the surface of the ground fire
hydrants for the benefit of Parcel 1 above, as granted and created by instrument
from W. Wood Prince and James F. Donovan, not as individuals but as Trustees of
the Central Manufacturing District under an Indenture and Declaration of Trust
dated February 1, 1916, and recorded in the office of the Recorder of Deeds of
Cook County, Illinois in Book 13717 of Records at Page 253, as Document Number
5814222 to Benefit Realty Company, an Illinois corporation, dated June 30, 1977
and recorded July 25, 1977 as Document 24025706 and filed in the office of the
Registrar of Titles on December 30, 1977 as Document LR2990769 over, under, on
and upon the following described parcels of land:
Easement 2: The West 18 feet of the South 10 feet of the North 149 feet of that
part of South St. Louis Avenue (a 66 foot private street) lying South of the
South line of West 47th Street (a 66 foot public street) in Block 7 of James H.
Rees' Subdivision of the Northeast 1/4 of Section 11, Township 38 North, Range
13 East of the Third Principal
Meridian, in Cook County, Illinois.
Easement 4: The South 10 feet of the North 24.67 feet of the West 242 feet of
the East 396 feet of that part of West 47th Place (a 60 foot private street)
lying West of the West line of South St. Louis Avenue (a 66 foot private
street); also the North 14.67 feet of the West 10 feet of the East 164 feet of
part of West 47th Place lying West of the West line of South St. Louis Avenue;
also the North 14.67 feet of the West 10 feet of the East 361 West 47th Place
lying West of the West line of said South St. Louis Avenue also the North 14.67
feet of the West 10 feet of the East 396 feet of said part of West 47th Place
lying West of the West line of said South St. Louis Avenue; being in Block 7 and
in the East 1/2 of Block 8 of James H. Rees' Subdivision of the
(Continued)
Northeast 1/4 of Section 11, Township 38 North, Range 13, East of the Third
Principal Meridian, in Cook County, Illinois.
Parcel 1 also known as:
Lots 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, and that part of Lot
17 falling in the North 410 feet South of the South line of 47th Street of Block
7, in the Subdivision of the West 1/2 of Block 7 of James H. Rees' Subdivision
of the Northeast 1/4 of Section 11, Township 38 North, Range 13 East of the
Third Principal Meridian, in Cook County, Illinois.
SCHEDULE 2
OLD PERMITTED ENCUMBRANCES
--------------------------
Those exceptions to title listed
in Lawyers Title Insurance Corporation
marked-up commitment #97-04952 dated June 30, 1997.
SCHEDULE 3
NEW DESCRIPTION OF THE LAND
---------------------------
(see attached)
P.I.N.: 1. 19-11-200-007
2. 19-11-200-034
3. 19-11-200-036
4. 19-11-200-003
Street Address: 3532 West 47th Place
Chicago, IL 60632
LEGAL DESCRIPTION:
Parcel 1: The North 410 feet of that part lying South of the South line of
West 47th Street (a 66 foot public street) and West of the West line of South
St. Louis Avenue (a 66 foot street now vacated) of Block 7 of James H. Rees'
Subdivision of the Northeast 1/4 of Section 11, Township 38 North, Range 13,
East of the Third Principal Meridian, in Cook County, Illinois.
Parcel 2: Easement for the construction, maintenance, operation and renewal
beneath the surface of the ground of high and low water pressure water mains
for supplying water for sprinkler service hydrants, and domestic purposes,
with the rights to construct, maintain, operate, and renew underneath the
surface of the ground, concrete or brick vaults (with covered manhole
openings at the surface) to house gate valves, meters, controls, and other
water devices; and with the right to construct, maintain, renew and operate
above the surface of the ground fire hydrants for the benefit of Parcel 1
above, as granted and created by instrument from W. Wood Prince and James F.
Donovan, not as individuals but as Trustees of the Central Manufacturing
District under an Indenture and Declaration of Trust dated February 1, 1916,
and recorded in the office of the Recorder of Deeds of Cook County, Illinois
in Book 13717 of Records at Page 253, as Document Number 5814222 to Benefit
Realty Company, an Illinois corporation, dated June 30, 1977 and recorded
July 25, 1977 as Document 24025706 and filed in the office of the Registrar
of Titles on December 30, 1977 as Document LR2990769 over, under, on and upon
the following described parcels of land:
Parcel 4: The South 205 feet of the North 410 feet of that part lying South
of the South line of West 47th Street (a 66 foot public street) of the East
1/2 of Block 8 of James H. Rees' Subdivision of the Northeast 1/4 of Section
11, Township 38 North, Range 13, East of the Third Principal Meridian, in
Cook County, Illinois.
Easement 2: The West 18 feet of the South 10 feet of the North 149 feet of
that part of South St. Louis Avenue (a 66 foot private street) lying South of
the South line of West 47th Street (a 66 foot public street) in Block 7 of
James H. Rees' Subdivision of the Northeast 1/4 of Section 11, Township 38
North, Range 13 East of the Third Principal Meridian, in Cook County,
Illinois.
Easement 4: The South 10 feet of the North 24.67 feet of the West 242 feet of
the East 396 feet of that part of West 47th Place (a 60 foot private street)
lying West of the West line of South St. Louis Avenue (a 66 foot private
street); also the North 14.67 feet of the West 10 feet of the East 164 feet
of part of West 47th Place lying West of the West line of South St. Louis
Avenue; also the North 14.67 feet of the West 10 feet of the East 361 feet of
part of West 47th Place lying West of the West line of said
(Continued)
South St. Louis Avenue; also the North 14.67 feet of the West 10 feet of the
East 396 feet of said part of West 47th Place lying West of the West line of
said South St. Louis Avenue; being in Block 7 and in the East 1/2 of Block 8
of James H. Rees' Subdivision of the Northeast 1/4 of Section 11, Township 38
North, Range 13, East of the Third Principal Meridian, in Cook County,
Illinois.
Parcel 1 also known as:
Lots 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, and that part of
Lot 17 falling in the North 410 feet South of the South line of 47th Street
of Block 7, in the Subdivision of the West 1/2 of Block 7 of James H. Rees'
Subdivision of the Northeast 1/4 of Section 11, Township 38 North, Range 13
East of the Third Principal Meridian, in Cook County, Illinois.
SCHEDULE 4
NEW PERMITTED ENCUMBRANCES
--------------------------
Those exceptions to title listed in
Lawyers Title Insurance Corporation
marked-up commitment #97-04952 (Revised)
dated ________ __, 1997.