The Subject Lease. (a) The Subject Lease is a valid and subsisting lease of that portion of the Premises demised thereunder for the term therein set forth, is in full force and effect in accordance with the terms thereof, and has not been modified except as expressly set forth herein. No material default exists, and to the best knowledge of Mortgagor, no event or act has occurred and no condition exists which with the passage of time or the giving of notice or both would constitute a material default, under the Subject Lease. (b) Without the prior written consent of Mortgagee, Mortgagor will not modify, amend, or in any way alter the terms of the Subject Lease if such modification, amendment or alteration would increase the monetary obligations of the Mortgagor under the Subject Lease in any material respect or otherwise be adverse in any material respect to the interests of Mortgagee or the value of the Mortgaged Property. Except to the extent permitted under the Revolving Facility Credit Agreement, without the prior written consent of Mortgagee, Mortgagor will not (i) in any way cancel, release, terminate, surrender or reduce the term of the Subject Lease, (ii) fail to exercise any option to renew or extend the term of the Subject Lease, (iii) waive, excuse, condone or in any way release or discharge the lessor under the Subject Lease of or from any material obligations, covenants, conditions and agreements by said lessor to be done and performed and (iv) consent to the subordination of the Subject Lease to any mortgage unless such subordination is conditioned upon the non-disturbance of Mortgagor, as tenant, by the applicable mortgagee. Any attempt on the part of Mortgagor to do any of the foregoing without such written consent of Mortgagee shall be null and void and of no effect and shall constitute a default hereunder. (c) Mortgagor shall at all times promptly and faithfully keep and perform in all material respects, or cause to be kept and performed in all material respects, all the covenants and conditions contained in the Subject Lease by the lessee therein to be kept and performed and shall in all material respects conform to and comply with the terms and conditions of the Subject Lease and Mortgagor further covenants that it will not do or permit anything to be done, the doing of which, or refrain from doing anything, the omission of which, would reasonably be expected to impair the security of this Mortgage. (d) Mortgagor shall promptly send Mortgagee a copy of any notice of default that it sends to the lessor under the Subject Lease and shall promptly provide to Mortgagee a copy of any notice of default received by Mortgagor from such lessor and this shall be done without regard to the fact that Mortgagee may be entitled to such notice directly from the lessor. Mortgagor shall promptly notify Mortgagee of any default under the Subject Lease by lessor or giving of any notice by the lessor to Mortgagor of such lessor’s intention to end the term thereof or the exercise of an early termination right under the Subject Lease. (e) To the extent that Mortgagee is not given the right by the lessor to cure any defaults of Mortgagor under the Subject Lease pursuant to the terms thereof, then notwithstanding any other provision of this Mortgage, following written notice of default sent by the lessor to Mortgagor and the completion of one-half of Mortgagor’s cure period with respect to such default, Mortgagee may (but shall not be obligated to) take any such action Mortgagee deems reasonably necessary or desirable to cure, in whole or in part, any failure of compliance by Mortgagor under the Subject Lease; and upon the receipt by Mortgagee from Mortgagor or the lessor under the Subject Lease of any written notice of default by Mortgagor as the lessee thereunder, Mortgagor may rely thereon, and such notice and conclusion of one-half of Mortgagor’s cure period shall constitute full authority and protection to Mortgagee for any action taken or omitted to be taken in good faith reliance thereon. All sums, including reasonable attorneys’ fees, so reasonably expended by the Mortgagee to cure or prevent any such default, or expended to sustain the lien of this Mortgage or its priority, shall be deemed secured by this Mortgage and shall be paid by the Mortgagor on demand, with interest accruing thereon at the Interest Rate. Upon the vesting of Mortgagee’s right to cure defaults under the Subject Lease as set forth pursuant to this paragraph, Mortgagor hereby expressly grants to Mortgagee (subject to the terms of the Subject Lease), and agrees that Mortgagee shall, upon prior notice to Mortgagor, have, the absolute and immediate right to enter in and upon the Land and the Improvements or any part thereof to such extent and as often as Mortgagee, deems reasonably necessary or desirable in order to cure any such default or alleged default by Mortgagor, provided, that, Mortgagee agrees that it shall not interfere with Mortgagor’s business conducted on the Land and Improvements and shall comply with Mortgagor’s reasonable security requirements. (f) Upon the occurrence and during the continuance of any Event of Default, all options, election, consents and approval rights conferred upon Mortgagor as lessee under the Subject Lease, together with the right of termination, cancelation, modification, change, supplement, alteration or amendment of the Subject Lease, all of which have been assigned for collateral purposes to Mortgagee, shall automatically vest exclusively in and be exercisable solely by Mortgagee, provided, that, if the lessor under the Subject Lease is not obligated to accept Mortgagee’s exercise of such options, elections, consents and approval rights, then Mortgagor shall have the right to exercise the same, subject to Mortgagee’s consent. (g) Mortgagor will give Mortgagee prompt written notice of the commencement of any arbitration or appraisal proceeding under and pursuant to the provisions of the Subject Lease. Following the occurrence and during the continuance of an Event of Default, Mortgagee shall have the right, but not the obligation, to intervene and participate in any such proceeding and Mortgagor shall confer with Mortgagee to the extent which Mortgagee deems reasonably necessary for the protection of Mortgagee. Mortgagor may compromise any dispute or approval which is the subject of an arbitration or appraisal proceeding, provided that Mortgagor shall first get the prior written consent of Mortgagee which approval will not be unreasonably withheld or delayed with respect to any such material disputes or approvals. (h) So long as this Mortgage is in effect, there shall be no merger of the Subject Lease or any interest therein, or of the leasehold estate created thereby, with the fee estate in the Land or any portion thereof by reason of the fact that the Subject Lease or such interest therein may be held directly or indirectly by or for the account of any person who shall hold the lessor’s fee estate in the Land or any portion thereof or any interest of the lessor under the Subject Lease. In case the Mortgagor acquires fee title to the Land, this Mortgage shall attach to and cover and be a lien upon the fee title acquired, and such fee title shall, without further assignment, mortgage or conveyance, become and be subject to the lien of and covered by this Mortgage. Mortgagor shall notify Mortgagee of any such acquisition and, on written request by Mortgagee, shall cause to be executed and recorded all such other and further assurances or other instruments in writing as may in the reasonable opinion of Mortgagee be necessary or appropriate to effect the intent and meaning hereof and shall deliver to Mortgagee an endorsement to Mortgagee’s loan title insurance policy insuring that such fee title or other estate is subject to the lien of this Mortgage. (i) If any action or proceeding shall be instituted to evict Mortgagor or to recover possession of any leasehold parcel or any part thereof or interest therein or any action or proceeding otherwise affecting the Subject Lease or this Mortgage shall be instituted, then Mortgagor will, promptly upon service thereof on or to Mortgagor, deliver to Mortgagee copies of any notice of motion, order to show cause and of all other provisions, pleadings, and papers, however designated, served in any such action or proceeding. (j) The lien of this Mortgage shall attach to all of Mortgagor’s rights and remedies at any time arising under or pursuant to Subsection 365(h) of the Bankruptcy Code, 11 U.S.C. 365(h), as the same may hereafter be amended (the “Bankruptcy Code”), including, without limitation, all of Mortgagor’s rights to remain in possession of each leasehold parcel. (k) Mortgagor hereby unconditionally assigns, transfers and sets over to Mortgagee all of Mortgagor’s claims and rights to the payment of damages arising from any rejection of the Subject Lease by the lessor or any other fee owner of any leasehold parcel or any portion thereof under the Bankruptcy Code. Mortgagee shall have the right to proceed in its own name or in the name of Mortgagor in respect of any claim, suit, action or proceeding relating to the rejection of the Subject Lease, including, without limitation, the right to file and prosecute, without joining or the joinder of Mortgagor, any proofs of claim, complaints, motions, applications, notices and other documents, in any case with respect to the lessor or any fee owner of all or a portion of any leasehold parcel under the Bankruptcy Code. This assignment constitutes a present, irrevocable and unconditional assignment of the foregoing claims, rights and remedies, and shall continue in effect until all of the Obligations shall have been satisfied and discharged in full. Mortgagor shall promptly make, execute, acknowledge and deliver, in form and substance satisfactory to Mortgagee, a UCC financing statement (Form UCC-1) and all such additional instruments, agreements and other documents, as may at any time hereafter be required by Mortgagee to effectuate and carry out the assignment pursuant to this paragraph. Notwithstanding the foregoing, so long as no Event of Default has occurred and is continuing, in the event of a rejection of the Subject Lease by the lessor or any other fee owner of any leasehold parcel or any portion thereof under the Bankruptcy Code, (a) Mortgagee shall not seek to treat the Subject Lease as terminated without the prior written consent of Mortgagor and any such termination by Mortgagee without Mortgagor’s consent shall be void, and (b) Mortgagee shall have the right to retain any amounts it receives as damages arising out of the rejection of the Subject Lease and Mortgagee shall promptly pay to Mortgagor any such amounts it receives. (l) If pursuant to Subsection 365(h)(1) of the Bankruptcy Code, 11 U.S.C. § 365(h)(1), Mortgagor shall seek to offset against the rent reserved in the Subject Lease the amount of any damages caused by the nonperformance by the lessor or any fee owner of any of their respective obligations under such Subject Lease after the rejection by the lessor or any fee owner of such Subject Lease under the Bankruptcy Code, then Mortgagor shall, prior to effecting such offset, notify Mortgagee of its intent to do so, setting forth the amount proposed to be so offset and the basis therefor. Mortgagee shall have the right to object to all or any part of such offset that, in the reasonable judgment of Mortgagee, would constitute a breach of such Subject Lease, and in the event of such objection, Mortgagor shall not effect any offset of the amounts to the extent objected to by Mortgagee. Neither Mortgagee’s failure to object as aforesaid nor any objection relating to such offset shall constitute an approval of any such offset by Mortgagee. (m) If any action, proceeding, motion or notice shall be commenced or filed in respect of the lessor or any fee owner of any leasehold parcel, or any portion thereof or interest therein, or the Subject Lease in connection with any case under the Bankruptcy Code, then Mortgagee shall have the option, exercisable upon written notice from Mortgagee to Mortgagor, to conduct and control any such litigation with counsel of Mortgagee’s choice. Mortgagee may proceed in its own name or in the name of Mortgagor in connection with any such litigation, and Mortgagor agrees to execute any and all powers, authorizations, consents or other documents required by Mortgagee in connection therewith. Mortgagor shall, upon demand, pay to Mortgagee all reasonable costs and expenses (including attorneys’ fees) paid or incurred by Mortgagee in connection with the prosecution or conduct of any such proceedings. Mortgagor shall not commence any action, suit, proceeding or case, or file any application or make any motion, in respect of the Subject Lease in any such case under Bankruptcy Code without the prior written consent of Mortgagee. Notwithstanding the foregoing, so long as no Event of Default has occurred and is continuing, Mortgagee shall not preclude Mortgagor from electing to retain its possessory interest and rights under the Subject Lease pursuant to Section 365(h)(1)(A)(ii) of the Bankruptcy Code. (n) Mortgagor shall, after obtaining knowledge thereof, promptly notify Mortgagee of any filing by or against the lessor or fee owner of any leasehold parcel of a petition under the Bankruptcy Code. Mortgagor shall promptly deliver to Mortgagee, following receipt, copies of any and all notices, summonses, pleadings, applications and other documents received by Mortgagor in connection with any such petition and any proceedings relating thereto. (o) If there shall be filed by or against Mortgagor a petition under the Bankruptcy Code and Mortgagor, as lessee under a Subject Lease, shall determine to reject such Subject Lease pursuant to Section 365(a) of the Bankruptcy Code, then Mortgagor shall give Mortgagee not less than twenty days’ prior notice of the date on which Mortgagor shall apply to the Bankruptcy Court for authority to reject such Subject Lease. Mortgagee shall have the right, but not the obligation, to serve upon Mortgagor within such twenty day period a notice stating that Mortgagee demands that Mortgagor assume and assign such Subject Lease to Mortgagee pursuant to Section 365 of the Bankruptcy Code. If Mortgagee shall serve upon Mortgagor the notice described in the preceding sentence, Mortgagor shall not seek to reject such Subject Lease and shall comply with the demand provided for in the preceding sentence. (p) Effective upon the entry of an order for relief with respect to Mortgagor under the Bankruptcy Code, Mortgagor hereby assigns and transfers to Mortgagee a non-exclusive right to apply to the Bankruptcy Court under subsection 365(d)(4) of the Bankruptcy Code for an order extending the period during which the Subject Lease may be rejected or assumed.
Appears in 1 contract
The Subject Lease. (a) The Subject Lease is a valid and subsisting lease of that portion of the Premises demised thereunder for the term therein set forth, is in full force and effect in accordance with the terms thereof, and has not been modified except as expressly set forth herein. No material default exists, and to the best knowledge of Mortgagor, no event or act has occurred and no condition exists which with the passage of time or the giving of notice or both would constitute a material default, under the Subject Lease.
(b) . Mortgagor shall ensure that the Subject Lease or a valid and subsisting memorandum or “short form” of the Subject Lease is recorded in the applicable real estate records in accordance with the terms of the recording statutes in the jurisdiction in which the Mortgaged Property is located until this Mortgage is released or satisfied in accordance with its terms. Without the prior written consent of Mortgagee, Mortgagor will not modify, amend, or in any way alter the terms of the Subject Lease if such modification, amendment or alteration would increase the monetary obligations of the Mortgagor under the Subject Lease in any material respect or otherwise be adverse in any material respect to the interests of Mortgagee or the value of the Mortgaged Property. Except to the extent permitted under the Revolving Facility Credit Agreement, without the prior written consent of Mortgagee, Mortgagor will not (i) in any way cancel, release, terminate, surrender or reduce the term of the Subject Lease, (ii) fail to exercise any option to renew or extend the term of the Subject Lease, (iii) waive, excuse, condone or in any way release or discharge the lessor under the Subject Lease of or from any material the obligations, covenants, conditions and agreements by said lessor to be done and performed and (iv) except as expressly required by the Subject Lease, consent to the subordination of the Subject Lease to any mortgage unless such subordination is conditioned upon the non-disturbance of Mortgagor, as tenant, by the applicable mortgageemortgage. Any attempt on the part of Mortgagor to do any of the foregoing without such written consent of Mortgagee shall be null and void and of no effect and shall constitute a default Default hereunder.
(c) . Mortgagor shall at all times promptly and faithfully keep and perform in all material respects, or cause to be kept and performed in all material respects, all the covenants and conditions contained in the Subject Lease by the lessee therein to be kept and performed and shall in all material respects conform to and comply with the terms and conditions of the Subject Lease and Mortgagor further covenants that it will not do or permit anything to be done, the doing of which, or refrain from doing anything, the omission of which, would reasonably be expected to will impair the security of this Mortgage.
(d) Mortgage or will be reason for declaring a default under the Subject Lease. Mortgagor shall promptly send give Mortgagee a copy prompt notice in writing of any notice default on the part of default that it sends to the lessor under the Subject Lease and shall promptly provide or of the receipt by Mortgagor of any notice of default from the lessor thereunder by providing to Mortgagee a copy of any such notice of default received by Mortgagor from such lessor and this shall be done without regard to the fact that Mortgagee may be entitled to such notice directly from the lessor. Mortgagor shall promptly notify Mortgagee of any default under the Subject Lease by lessor or giving of any notice by the lessor to Mortgagor of such lessor’s intention to end the term thereof thereof. Mortgagor shall furnish to Mortgagee promptly upon Mortgagee’s request any and all information concerning the performance by Mortgagor of the covenants of the Subject Lease and shall permit Mortgagee or its representative at all reasonable times, upon reasonable notice, to make investigation or examination concerning the exercise performance by Mortgagor of an early termination right under the covenants of the Subject Lease.
(e) To . Mortgagor shall deposit with Mortgagee an exact copy of any notice, communication, plan, specification or other instrument or document received or given by Mortgagor in any way relating to or affecting the extent that Mortgagee is not given Subject Lease which may concern or affect the right by estate of the lessor to cure any defaults of Mortgagor or the lessee in or under the Subject Lease pursuant to or the terms thereof, then notwithstanding property leased thereby. Notwithstanding any other provision of this Mortgage, following written notice of default sent by the lessor to Mortgagor and the completion of one-half of Mortgagor’s cure period with respect to such default, Mortgagee may (but shall not be obligated to) ), after reasonable notice to Mortgagor, take any such action Mortgagee deems reasonably necessary or desirable to cure, in whole or in part, any failure of compliance by Mortgagor under the Subject Lease; and upon the receipt by Mortgagee from Mortgagor or the lessor under the Subject Lease of any written notice of default by Mortgagor as the lessee thereunder, Mortgagor may rely thereon, and such notice and conclusion of one-half of Mortgagor’s cure period shall constitute full authority and protection to Mortgagee for any action taken or omitted to be taken in good faith reliance thereon. All sums, including reasonable attorneys’ fees, so reasonably expended by the Mortgagee to cure or prevent any such default, or expended to sustain the lien of this Mortgage or its priority, shall be deemed secured by this Mortgage and shall be paid by the Mortgagor on demand, with interest accruing thereon at the Interest Rate. Upon the vesting of Mortgagee’s right to cure defaults under the Subject Lease as set forth pursuant to this paragraph, Mortgagor hereby expressly grants to Mortgagee (subject to the terms of the Subject Lease), and agrees that Mortgagee shall, upon prior notice to Mortgagor, shall have, the absolute and immediate right to enter in and upon the Land and the Improvements or any part thereof to such extent and as often as Mortgagee, in its discretion, deems reasonably necessary or desirable in order to cure any such default or alleged default by Mortgagor, provided, that, Mortgagee agrees that it shall not interfere with Mortgagor’s business conducted on the Land and Improvements and shall comply with Mortgagor’s reasonable security requirements.
(f) . Upon the occurrence and during the continuance of any Event of Default, all options, election, consents and approval rights conferred upon Mortgagor as lessee under the Subject Lease, together with the right of termination, cancelation, modification, change, supplement, alteration or amendment of the Subject Lease, all of which have been assigned for collateral purposes to Mortgagee, shall automatically vest exclusively in and be exercisable solely by Mortgagee, provided, that, if the lessor under the Subject Lease is not obligated to accept Mortgagee’s exercise of such options, elections, consents and approval rights, then Mortgagor shall have the right to exercise the same, subject to Mortgagee’s consent.
(g) . Mortgagor will give Mortgagee prompt written notice of the commencement of any arbitration or appraisal proceeding under and pursuant to the provisions of the Subject Lease. Following the occurrence and during the continuance of an Event of Default, Mortgagee shall have the right, but not the obligation, to intervene and participate in any such proceeding and Mortgagor shall confer with Mortgagee to the extent which Mortgagee deems reasonably necessary for the protection of Mortgagee. Following the occurrence and during the continuance of an Event of Default, Mortgagor may compromise any dispute or approval which is the subject of an arbitration or appraisal proceeding, provided that Mortgagor shall first get proceeding only with the prior written consent of Mortgagee which approval will not be unreasonably withheld or delayed with respect to (it being understood that at all other times Mortgagor may compromise any such material disputes dispute or approvals.
(h) approval which is the subject of an arbitration or appraisal proceeding without the consent of Mortgagee). So long as this Mortgage is in effect, there shall be no merger of the Subject Lease or any interest therein, or of the leasehold estate created thereby, with the fee estate in the Land or any portion thereof by reason of the fact that the Subject Lease or such interest therein may be held directly or indirectly by or for the account of any person who shall hold the lessor’s fee estate in the Land or any portion thereof or any interest of the lessor under the Subject Lease. In case the Mortgagor acquires fee title to the Land, this Mortgage shall attach to and cover and be a lien upon the fee title acquired, and such fee title shall, without further assignment, mortgage or conveyance, become and be subject to the lien of and covered by this Mortgage. Mortgagor shall notify Mortgagee of any such acquisition and, on written request by Mortgagee, shall cause to be executed and recorded all such other and further assurances or other instruments in writing as may in the reasonable opinion of Mortgagee be necessary or appropriate to effect the intent and meaning hereof and shall deliver to Mortgagee an endorsement to Mortgagee’s loan title insurance policy insuring that such fee title or other estate is subject to the lien of this Mortgage.
(i) . If any action or proceeding shall be instituted to evict Mortgagor or to recover possession of any leasehold parcel or any part thereof or interest therein or any action or proceeding otherwise affecting the Subject Lease or this Mortgage shall be instituted, then Mortgagor will, promptly immediately upon service thereof on or to Mortgagor, deliver to Mortgagee copies of any a notice of motion, order to show cause and of all other provisions, pleadings, and papers, however designated, served in any such action or proceeding.
(j) . The lien of this Mortgage shall attach to all of Mortgagor’s rights and remedies at any time arising under or pursuant to Subsection 365(h) of the Bankruptcy Code, 11 U.S.C. 365(h), as the same may hereafter be amended (the “Bankruptcy Code”), including, without limitation, all of Mortgagor’s rights to remain in possession of each leasehold parcel.
(k) . Mortgagor hereby unconditionally assigns, transfers and sets over to Mortgagee all of Mortgagor’s claims and rights to the payment of damages arising from any rejection of the Subject Lease by the lessor or any other fee owner of any leasehold parcel or any portion thereof under the Bankruptcy Code. Mortgagee shall have the right to proceed in its own name or in the name of Mortgagor in respect of any claim, suit, action or proceeding relating to the rejection of the Subject Lease, including, without limitation, the right to file and prosecute, without joining or the joinder of Mortgagor, any proofs of claim, complaints, motions, applications, notices and other documents, in any case with respect to the lessor or any fee owner of all or a portion of any leasehold parcel under the Bankruptcy Code. This assignment constitutes a present, irrevocable and unconditional assignment of the foregoing claims, rights and remedies, and shall continue in effect until all of the Obligations shall have been satisfied and discharged in full. Any amounts received by Mortgagee as damages arising out of the rejection of the Subject Lease as aforesaid shall be applied first to all costs and expenses of Mortgagee (including, without limitation, reasonable attorneys’ fees) incurred in connection with the exercise of any of its rights or remedies under this paragraph. Mortgagor shall promptly make, execute, acknowledge and deliver, in form and substance satisfactory to Mortgagee, a UCC financing statement (Form UCC-1) and all such additional instruments, agreements and other documents, as may at any time hereafter be required by Mortgagee to effectuate and carry out the assignment pursuant to this paragraph. Notwithstanding the foregoing, so long as no Event of Default has occurred and is continuing, in the event of a rejection of the Subject Lease by the lessor or any other fee owner of any leasehold parcel or any portion thereof under the Bankruptcy Code, (a) Mortgagee shall not seek to treat the Subject Lease as terminated without the prior written consent of Mortgagor and any such termination by Mortgagee without Mortgagor’s consent shall be void, and (b) Mortgagee shall have the right to retain any amounts it receives as damages arising out of the rejection of the Subject Lease and Mortgagee shall promptly pay to Mortgagor any such amounts it receives.
(l) If pursuant to Subsection 365(h)(1365(h)(2) of the Bankruptcy Code, 11 U.S.C. § 365(h)(1365(h)(2), Mortgagor shall seek to offset against the rent reserved in the Subject Lease the amount of any damages caused by the nonperformance by the lessor or any fee owner of any of their respective obligations under such Subject Lease after the rejection by the lessor or any fee owner of such Subject Lease under the Bankruptcy Code, then Mortgagor shall, prior to effecting such offset, notify Mortgagee of its intent to do so, setting forth the amount proposed to be so offset and the basis therefor. Mortgagee shall have the right to object to all or any part of such offset that, in the reasonable judgment of Mortgagee, would constitute a breach of such Subject Lease, and in the event of such objection, Mortgagor shall not effect any offset of the amounts to the extent so objected to by Mortgagee. Neither Mortgagee’s failure to object as aforesaid nor any objection relating to such offset shall constitute an approval of any such offset by Mortgagee.
(m) . If any action, proceeding, motion or notice shall be commenced or filed in respect of the lessor or any fee owner of any leasehold parcel, or any portion thereof or interest therein, or the Subject Lease in connection with any case under the Bankruptcy Code, then Mortgagee shall have the option, exercisable upon written notice from Mortgagee to Mortgagor, to conduct and control any such litigation with counsel of Mortgagee’s choice. Mortgagee may proceed in its own name or in the name of Mortgagor in connection with any such litigation, and Mortgagor agrees to execute any and all powers, authorizations, consents or other documents required by Mortgagee in connection therewith. Mortgagor shall, upon demand, pay to Mortgagee all reasonable costs and expenses (including attorneys’ fees) paid or incurred by Mortgagee in connection with the prosecution or conduct of any such proceedings. Mortgagor shall not commence any action, suit, proceeding or case, or file any application or make any motion, in respect of the Subject Lease in any such case under Bankruptcy Code without the prior written consent of Mortgagee. Notwithstanding the foregoing, so long as no Event of Default has occurred and is continuing, Mortgagee shall not preclude Mortgagor from electing to retain its possessory interest and rights under the Subject Lease pursuant to Section 365(h)(1)(A)(ii) of the Bankruptcy Code.
(n) Mortgagor shall, after obtaining knowledge thereof, promptly notify Mortgagee of any filing by or against the lessor or fee owner of any leasehold parcel of a petition under the Bankruptcy Code. Mortgagor shall promptly deliver to Mortgagee, following receipt, copies of any and all notices, summonses, pleadings, applications and other documents received by Mortgagor in connection with any such petition and any proceedings relating thereto.
(o) . If there shall be filed by or against Mortgagor a petition under the Bankruptcy Code and Mortgagor, as lessee under a Subject Lease, shall determine to reject such Subject Lease pursuant to Section 365(a) of the Bankruptcy Code, then Mortgagor shall give Mortgagee not less than twenty days’ prior notice of the date on which Mortgagor shall apply to the Bankruptcy Court for authority to reject such Subject Lease. Mortgagee shall have the right, but not the obligation, to serve upon Mortgagor within such twenty day period a notice stating that Mortgagee demands that Mortgagor assume and assign such Subject Lease to Mortgagee pursuant to Section 365 of the Bankruptcy Code. If Mortgagee shall serve upon Mortgagor the notice described in the preceding sentence, Mortgagor shall not seek to reject such Subject Lease and shall comply with the demand provided for in the preceding sentence.
(p) . Effective upon the entry of an order for relief with respect to Mortgagor under the Bankruptcy Code, Mortgagor hereby assigns and transfers to Mortgagee a non-exclusive right to apply to the Bankruptcy Court under subsection 365(d)(4) of the Bankruptcy Code for an order extending the period during which the Subject Lease may be rejected or assumed. Within ten days after the date hereof, Mortgagor shall deliver notice of the granting of this Mortgage to the lessor under the Subject Lease together with the address of Mortgagee for notices. If required by the Subject Lease, such notice shall include a copy of this Mortgage and shall otherwise be in form and substance sufficient to secure for Mortgagee any rights granted to the holders of leasehold mortgages pursuant to the terms of the Subject Lease. Mortgagor shall provide Mortgagee with evidence of the delivery of such notice to the lessor under the Subject Lease within five days after it is delivered.
Appears in 1 contract
The Subject Lease. (a) The Subject Lease is a valid and subsisting lease of that portion of the Premises demised thereunder for the term therein set forth, is in full force and effect in accordance with the terms thereof, and has not been modified except as expressly set forth herein. No material default exists, and to the best knowledge of Mortgagor, no event or act has occurred and no condition exists which with the passage of time or the giving of notice or both would constitute a material default, under the Subject Lease. Mortgagor shall ensure that the Subject Lease or a valid and subsisting memorandum or “short form” of the Subject Lease is recorded in the applicable real estate records in accordance with the terms of the recording statutes in the jurisdiction in which the Mortgaged Property is located until this Mortgage is released or satisfied in accordance with its terms.
(b) Without the prior written consent of Mortgagee, Mortgagor will not modify, amend, or in any way alter the terms of the Subject Lease if such modification, amendment or alteration would increase the monetary obligations of the Mortgagor under the Subject Lease in any material respect or otherwise be adverse in any material respect to the interests of Mortgagee or the value of the Mortgaged Property. Except to the extent permitted under the Revolving Facility Credit Agreement, without the prior written consent of Mortgagee, Mortgagor will not (i) in any way cancel, release, terminate, surrender or reduce the term of the Subject Lease, (ii) fail to exercise any option to renew or extend the term of the Subject Lease, (iii) waive, excuse, condone or in any way release or discharge the lessor under the Subject Lease of or from any material the obligations, covenants, conditions and agreements by said lessor to be done and performed and (iv) except as expressly required by the Subject Lease, consent to the subordination of the Subject Lease to any mortgage unless such subordination is conditioned upon the non-disturbance of Mortgagor, as tenant, by the applicable mortgageemortgage. Any attempt on the part of Mortgagor to do any of the foregoing without such written consent of Mortgagee shall be null and void and of no effect and shall constitute a default Default hereunder.
(c) Mortgagor shall at all times promptly and faithfully keep and perform in all material respects, or cause to be kept and performed in all material respects, all the covenants and conditions contained in the Subject Lease by the lessee therein to be kept and performed and shall in all material respects conform to and comply with the terms and conditions of the Subject Lease and Mortgagor further covenants that it will not do or permit anything to be done, the doing of which, or refrain from doing anything, the omission of which, would reasonably be expected to will impair the security of this MortgageMortgage or will be reason for declaring a default under the Subject Lease.
(d) Mortgagor shall promptly send give Mortgagee a copy prompt notice in writing of any notice default on the part of default that it sends to the lessor under the Subject Lease and shall promptly provide or of the receipt by Mortgagor of any notice of default from the lessor thereunder by providing to Mortgagee a copy of any such notice of default received by Mortgagor from such lessor and this shall be done without regard to the fact that Mortgagee may be entitled to such notice directly from the lessor. Mortgagor shall promptly notify Mortgagee of any default under the Subject Lease by lessor or giving of any notice by the lessor to Mortgagor of such lessor’s intention to end the term thereof thereof. Mortgagor shall furnish to Mortgagee promptly upon Mortgagee’s request any and all information concerning the performance by Mortgagor of the covenants of the Subject Lease and shall permit Mortgagee or its representative at all reasonable times, upon reasonable notice, to make investigation or examination concerning the performance by Mortgagor of the covenants of the Subject Lease. Mortgagor shall deposit with Mortgagee an exact copy of any notice, communication, plan, specification or other instrument or document received or given by Mortgagor in any way relating to or affecting the Subject Lease which may concern or affect the estate of the lessor or the exercise of an early termination right lessee in or under the Subject LeaseLease or the property leased thereby.
(e) To the extent that Mortgagee is not given the right by the lessor to cure any defaults of Mortgagor under the Subject Lease pursuant to the terms thereof, then notwithstanding Notwithstanding any other provision of this Mortgage, following written notice of default sent by the lessor to Mortgagor and the completion of one-half of Mortgagor’s cure period with respect to such default, Mortgagee may (but shall not be obligated to) ), after reasonable notice to Mortgagor, take any such action Mortgagee deems reasonably necessary or desirable to cure, in whole or in part, any failure of compliance by Mortgagor under the Subject Lease; and upon the receipt by Mortgagee from Mortgagor or the lessor under the Subject Lease of any written notice of default by Mortgagor as the lessee thereunder, Mortgagor may rely thereon, and such notice and conclusion of one-half of Mortgagor’s cure period shall constitute full authority and protection to Mortgagee for any action taken or omitted to be taken in good faith reliance thereon. All sums, including reasonable attorneys’ fees, so reasonably expended by the Mortgagee to cure or prevent any such default, or expended to sustain the lien of this Mortgage or its priority, shall be deemed secured by this Mortgage and shall be paid by the Mortgagor on demand, with interest accruing thereon at the Interest Rate. Upon the vesting of Mortgagee’s right to cure defaults under the Subject Lease as set forth pursuant to this paragraph, Mortgagor hereby expressly grants to Mortgagee (subject to the terms of the Subject Lease), and agrees that Mortgagee shall, upon prior notice to Mortgagor, shall have, the absolute and immediate right to enter in and upon the Land and the Improvements or any part thereof to such extent and as often as Mortgagee, in its discretion, deems reasonably necessary or desirable in order to cure any such default or alleged default by Mortgagor, provided, that, Mortgagee agrees that it shall not interfere with Mortgagor’s business conducted on the Land and Improvements and shall comply with Mortgagor’s reasonable security requirements.
(f) Upon the occurrence and during the continuance of any Event of Default, all options, election, consents and approval rights conferred upon Mortgagor as lessee under the Subject Lease, together with the right of termination, cancelation, modification, change, supplement, alteration or amendment of the Subject Lease, all of which have been assigned for collateral purposes to Mortgagee, shall automatically vest exclusively in and be exercisable solely by Mortgagee, provided, that, if the lessor under the Subject Lease is not obligated to accept Mortgagee’s exercise of such options, elections, consents and approval rights, then Mortgagor shall have the right to exercise the same, subject to Mortgagee’s consent.
(g) Mortgagor will give Mortgagee prompt written notice of the commencement of any arbitration or appraisal proceeding under and pursuant to the provisions of the Subject Lease. Following the occurrence and during the continuance of an Event of Default, Mortgagee shall have the right, but not the obligation, to intervene and participate in any such proceeding and Mortgagor shall confer with Mortgagee to the extent which Mortgagee deems reasonably necessary for the protection of Mortgagee. Following the occurrence and during the continuance of an Event of Default, Mortgagor may compromise any dispute or approval which is the subject of an arbitration or appraisal proceeding, provided that Mortgagor shall first get proceeding only with the prior written consent of Mortgagee which approval will not be unreasonably withheld or delayed with respect to (it being understood that at all other times Mortgagor may compromise any such material disputes dispute or approvalsapproval which is the subject of an arbitration or appraisal proceeding without the consent of Mortgagee).
(h) So long as this Mortgage is in effect, there shall be no merger of the Subject Lease or any interest therein, or of the leasehold estate created thereby, with the fee estate in the Land or any portion thereof by reason of the fact that the Subject Lease or such interest therein may be held directly or indirectly by or for the account of any person who shall hold the lessor’s fee estate in the Land or any portion thereof or any interest of the lessor under the Subject Lease. In case the Mortgagor acquires fee title to the Land, this Mortgage shall attach to and cover and be a lien upon the fee title acquired, and such fee title shall, without further assignment, mortgage or conveyance, become and be subject to the lien of and covered by this Mortgage. Mortgagor shall notify Mortgagee of any such acquisition and, on written request by Mortgagee, shall cause to be executed and recorded all such other and further assurances or other instruments in writing as may in the reasonable opinion of Mortgagee be necessary or appropriate to effect the intent and meaning hereof and shall deliver to Mortgagee an endorsement to Mortgagee’s loan title insurance policy insuring that such fee title or other estate is subject to the lien of this Mortgage.
(i) If any action or proceeding shall be instituted to evict Mortgagor or to recover possession of any leasehold parcel or any part thereof or interest therein or any action or proceeding otherwise affecting the Subject Lease or this Mortgage shall be instituted, then Mortgagor will, promptly immediately upon service thereof on or to Mortgagor, deliver to Mortgagee copies of any a notice of motion, order to show cause and of all other provisions, pleadings, and papers, however designated, served in any such action or proceeding.
(j) The lien of this Mortgage shall attach to all of Mortgagor’s rights and remedies at any time arising under or pursuant to Subsection 365(h) of the Bankruptcy Code, 11 U.S.C. 365(h), as the same may hereafter be amended (the “Bankruptcy Code”), including, without limitation, all of Mortgagor’s rights to remain in possession of each leasehold parcel.
(k) Mortgagor hereby unconditionally assigns, transfers and sets over to Mortgagee all of Mortgagor’s claims and rights to the payment of damages arising from any rejection of the Subject Lease by the lessor or any other fee owner of any leasehold parcel or any portion thereof under the Bankruptcy Code. Mortgagee shall have the right to proceed in its own name or in the name of Mortgagor in respect of any claim, suit, action or proceeding relating to the rejection of the Subject Lease, including, without limitation, the right to file and prosecute, without joining or the joinder of Mortgagor, any proofs of claim, complaints, motions, applications, notices and other documents, in any case with respect to the lessor or any fee owner of all or a portion of any leasehold parcel under the Bankruptcy Code. This assignment constitutes a present, irrevocable and unconditional assignment of the foregoing claims, rights and remedies, and shall continue in effect until all of the Obligations shall have been satisfied and discharged in full. Any amounts received by Mortgagee as damages arising out of the rejection of the Subject Lease as aforesaid shall be applied first to all costs and expenses of Mortgagee (including, without limitation, reasonable attorneys’ fees) incurred in connection with the exercise of any of its rights or remedies under this paragraph. Mortgagor shall promptly make, execute, acknowledge and deliver, in form and substance satisfactory to Mortgagee, a UCC financing statement (Form UCC-1) and all such additional instruments, agreements and other documents, as may at any time hereafter be required by Mortgagee to effectuate and carry out the assignment pursuant to this paragraph. Notwithstanding the foregoing, so long as no Event of Default has occurred and is continuing, in the event of a rejection of the Subject Lease by the lessor or any other fee owner of any leasehold parcel or any portion thereof under the Bankruptcy Code, (a) Mortgagee shall not seek to treat the Subject Lease as terminated without the prior written consent of Mortgagor and any such termination by Mortgagee without Mortgagor’s consent shall be void, and (b) Mortgagee shall have the right to retain any amounts it receives as damages arising out of the rejection of the Subject Lease and Mortgagee shall promptly pay to Mortgagor any such amounts it receives.
(l) If pursuant to Subsection 365(h)(1365(h)(2) of the Bankruptcy Code, 11 U.S.C. § 365(h)(1365(h)(2), Mortgagor shall seek to offset against the rent reserved in the Subject Lease the amount of any damages caused by the nonperformance by the lessor or any fee owner of any of their respective obligations under such Subject Lease after the rejection by the lessor or any fee owner of such Subject Lease under the Bankruptcy Code, then Mortgagor shall, prior to effecting such offset, notify Mortgagee of its intent to do so, setting forth the amount proposed to be so offset and the basis therefor. Mortgagee shall have the right to object to all or any part of such offset that, in the reasonable judgment of Mortgagee, would constitute a breach of such Subject Lease, and in the event of such objection, Mortgagor shall not effect any offset of the amounts to the extent so objected to by Mortgagee. Neither Mortgagee’s failure to object as aforesaid nor any objection relating to such offset shall constitute an approval of any such offset by Mortgagee.
(m) If any action, proceeding, motion or notice shall be commenced or filed in respect of the lessor or any fee owner of any leasehold parcel, or any portion thereof or interest therein, or the Subject Lease in connection with any case under the Bankruptcy Code, then Mortgagee shall have the option, exercisable upon written notice from Mortgagee to Mortgagor, to conduct and control any such litigation with counsel of Mortgagee’s choice. Mortgagee may proceed in its own name or in the name of Mortgagor in connection with any such litigation, and Mortgagor agrees to execute any and all powers, authorizations, consents or other documents required by Mortgagee in connection therewith. Mortgagor shall, upon demand, pay to Mortgagee all reasonable costs and expenses (including attorneys’ fees) paid or incurred by Mortgagee in connection with the prosecution or conduct of any such proceedings. Mortgagor shall not commence any action, suit, proceeding or case, or file any application or make any motion, in respect of the Subject Lease in any such case under Bankruptcy Code without the prior written consent of Mortgagee. Notwithstanding the foregoing, so long as no Event of Default has occurred and is continuing, Mortgagee shall not preclude Mortgagor from electing to retain its possessory interest and rights under the Subject Lease pursuant to Section 365(h)(1)(A)(ii) of the Bankruptcy Code.
(n) Mortgagor shall, after obtaining knowledge thereof, promptly notify Mortgagee of any filing by or against the lessor or fee owner of any leasehold parcel of a petition under the Bankruptcy Code. Mortgagor shall promptly deliver to Mortgagee, following receipt, copies of any and all notices, summonses, pleadings, applications and other documents received by Mortgagor in connection with any such petition and any proceedings relating thereto.
(o) If there shall be filed by or against Mortgagor a petition under the Bankruptcy Code and Mortgagor, as lessee under a Subject Lease, shall determine to reject such Subject Lease pursuant to Section 365(a) of the Bankruptcy Code, then Mortgagor shall give Mortgagee not less than twenty days’ prior notice of the date on which Mortgagor shall apply to the Bankruptcy Court for authority to reject such Subject Lease. Mortgagee shall have the right, but not the obligation, to serve upon Mortgagor within such twenty day period a notice stating that Mortgagee demands that Mortgagor assume and assign such Subject Lease to Mortgagee pursuant to Section 365 of the Bankruptcy Code. If Mortgagee shall serve upon Mortgagor the notice described in the preceding sentence, Mortgagor shall not seek to reject such Subject Lease and shall comply with the demand provided for in the preceding sentence.
(p) Effective upon the entry of an order for relief with respect to Mortgagor under the Bankruptcy Code, Mortgagor hereby assigns and transfers to Mortgagee a non-exclusive right to apply to the Bankruptcy Court under subsection 365(d)(4) of the Bankruptcy Code for an order extending the period during which the Subject Lease may be rejected or assumed.
(q) Within ten days after the date hereof, Mortgagor shall deliver notice of the granting of this Mortgage to the lessor under the Subject Lease together with the address of Mortgagee for notices. If required by the Subject Lease, such notice shall include a copy of this Mortgage and shall otherwise be in form and substance sufficient to secure for Mortgagee any rights granted to the holders of leasehold mortgages pursuant to the terms of the Subject Lease. Mortgagor shall provide Mortgagee with evidence of the delivery of such notice to the lessor under the Subject Lease within five days after it is delivered.
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