EXHIBIT 10.10
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LEASEHOLD MORTGAGE, SECURITY AGREEMENT,
ASSIGNMENT OF RENTS
and
FINANCING STATEMENT
between
ABLE LABORATORIES, INC.,
as Mortgagor
and
NEW JERSEY ECONOMIC DEVELOPMENT AUTHORITY,
as Mortgagee
Dated as of
June 1, 1999
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Record and return to:
▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇▇ & English, LLP
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
TABLE OF CONTENTS
(This Table of Contents is for convenience of reference only and is not a part
of the Leasehold Mortgage, Security Agreement, Assignment of Rents and Financing
Statement.)
Page
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ARTICLE I DEFINITIONS........................................................2
Section 1.01. Terms Defined Above..................................2
Section 1.02. Definitions..........................................2
Section 1.03. Interpretations......................................5
Section 1.04. References, etc......................................6
Section 1.05. Incorporation of Certain Definitions
by Reference.........................................6
Section 1.06. Accounting Terms and Determinations:
Incorporation of UCC Definitions.....................6
ARTICLE II GRANT OF INTEREST AND ASSIGNMENT OF MORTGAGE......................7
Section 2.01. Grant of Interest....................................7
Section 2.02. Assignment of Mortgage...............................7
ARTICLE III REPRESENTATIONS AND WARRANTIES...................................8
Section 3.01. Warranties of Title..................................8
Section 3.02. Lien of this Mortgage................................8
Section 3.03. Financings...........................................8
Section 3.04. Impositions and Other Payments.......................8
ARTICLE IV COVENANTS AND OBLIGATIONS OF THE MORTGAGOR.......................10
Section 4.01. Defects in Title....................................10
Section 4.02. Maintenance and Repair..............................10
ARTICLE V EVENTS OF DEFAULT; REMEDIES.......................................11
Section 5.01. Event of Default....................................11
Section 5.02. Remedies............................................12
Section 5.03. Application of Proceeds.............................14
Section 5.04. Delivery of Possession..............................14
Section 5.05. Appointment of Receiver.............................15
Section 5.06. Remedies Cumulative. Concurrent
and Non-Exclusive...................................15
Section 5.07. No Conditions Precedent to Exercise
of Remedies.........................................15
Section 5.08. Extension, Rearrangement or Renewal of
the Amounts Due under the Agreement.................16
Section 5.09. Waiver of Redemption, Notice and Marshalling
of Assets...........................................16
Section 5.10. Repayment of Expenses...............................16
ARTICLE VI SECURITY AGREEMENT...............................................17
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Section 6.01. Security Agreement..................................17
Section 6.02. Fixture Filing......................................17
Section 6.03. Security Agreement: Remedies........................17
ARTICLE VII ASSIGNMENT OF RENTS.............................................20
Section 7.01. Assignment of Rents.................................20
Section 7.02. Rights of the Mortgagor's Limited License...........20
Section 7.03. Enforcement of Rents................................20
Section 7.04. Suits and Attornment................................21
Section 7.05. Conflict............................................21
Section 7.06. Assignment of Rents; Remedies.......................21
ARTICLE VIII ENVIRONMENTAL REPRESENTATIONS AND COVENANTS....................23
Section 8.01. Definitions.........................................23
Section 8.02. Representations and Warranties......................23
Section 8.03. Covenants...........................................26
Section 8.04. Indemnities.........................................28
Section 8.05. General.............................................30
ARTICLE IX MISCELLANEOUS PROVISIONS.........................................31
Section 9.01. Construction Mortgage...............................31
Section 9.02. No Obligation of the Mortgagee......................31
Section 9.03. Mortgagor's Attorney-in-Fact........................31
Section 9.04. Damage, Destruction, Condemnation
and Eminent Domain..................................32
Section 9.05. No Waiver by the Mortgagee..........................32
Section 9.06. Satisfaction........................................32
Section 9.07. Notices.............................................32
Section 9.08. Amendment and Waiver................................33
Section 9.09. Payment of Costs and Expenses of Mortgagee..........33
Section 9.10. Taxation of the Amounts Due Under Agreement
and Mortgage........................................33
Section 9.11. No Credit for Taxes.................................34
Section 9.12. Due on Sale; Assignability..........................34
Section 9.13. Severability........................................34
Section 9.14. Governing Law.......................................34
Section 9.15. Future Advances.....................................35
Section 9.16. Headings............................................35
Section 9.17. Entire Agreement....................................35
Section 9.18. Time of the Essence.................................35
Section 9.19. Further Action By Mortgagor.........................35
Section 9.20. Advances by Mortgagee...............................35
Section 9.21. Invalid Provision Disregarded.......................35
Section 9.22. Inspection and Repairs by the Mortgagee.............35
Section 9.23. Assignment..........................................36
SCHEDULE 8.02..............................................................S-1
EXHIBIT A..................................................................A-1
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LEASEHOLD MORTGAGE, SECURITY AGREEMENT,
ASSIGNMENT OF RENTS AND FINANCING STATEMENT
THIS LEASEHOLD MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS AND
FINANCING STATEMENT (this "Mortgage") dated as of June 1, 1999, is entered into
between ABLE LABORATORIES, INC., a corporation organized and existing under the
laws of the State of Delaware and duly qualified to transact business in the
State of New Jersey (the "Mortgagor") and the NEW JERSEY ECONOMIC DEVELOPMENT
AUTHORITY, a public body corporate and politic and a political subdivision of
the State of New Jersey (the "Mortgagee" or the "Authority").
W I T N E S S E T H:
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WHEREAS, the Mortgagor has requested the assistance of the Mortgagee in
financing the acquisition of machinery and equipment for an existing
manufacturing facility located in South Plainfield, New Jersey (the "Project");
and
WHEREAS, to finance the costs of the Project, including (i) the funding
of a debt service reserve fund for the Bonds (defined below), (ii) the funding
of a lease reserve fund and (iii) the payment of a portion of the issuance costs
for the Bonds incurred by the Mortgagor in connection with the proposed
financing, the Authority has authorized the issuance of its Industrial
Development Revenue Bonds (Able Laboratories, Inc. Project) Series 1999A, in the
aggregate principal amount of $1,700,000 (the "Series 1999A Bonds") and its
Industrial Development Revenue Bonds (Able Laboratories, Inc. Project) (Taxable)
Series 1999B, in the aggregate principal amount of $300,000 (the "Series 1999B
Bonds" and collectively with the Series 1999A Bonds, the "Bonds"); and
WHEREAS, the Bonds are to be issued under and secured by a Trust
Indenture dated as of June 1, 1999 (as amended and supplemented from time to
time, the "Indenture") with U.S. Bank Trust National Association, in Phoenix,
Arizona (together with its successors, the "Trustee") pursuant to which the
Bonds will be issued; and
WHEREAS, the Authority has entered into a Loan Agreement, dated as of
June 1, 1999 (as may be from time to time amended, the "Agreement"), with the
Mortgagor under which the Authority will lend the proceeds of the Bonds to the
Mortgagor to be used to finance the costs of the Project, and the Mortgagor will
agree to repay the loan at the times and in the installments sufficient to
provide the Authority with money to pay the debt service on the Bonds; and
WHEREAS, the Mortgagor, to secure the Bonds and its obligations under
the Agreement, will execute and deliver to the Authority, and the Authority will
assign to the Trustee, this Mortgage granting (i) a first mortgage lien on the
Mortgagor's leasehold interest in the Facility (as hereinafter defined), (ii) a
first security interest in the Borrower's Equipment (as such term is
defined in the Uniform Commercial Code as in effect in the State) financed with
proceeds of the Bonds, subject to the Permitted Encumbrances and (iii) a
subordinate security interest in Accounts, Chattel Paper, Gross Revenues,
Documents, Equipment of the Borrower not financed with proceeds of the Bonds,
General Intangibles, Instruments and Inventory (as such terms are defined in the
Uniform Commercial Code as in effect in the State), subject to Permitted
Encumbrances.
NOW, THEREFORE, in consideration of the premises herein contained, and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Mortgagor agrees as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Terms Defined Above. As used in this Mortgage,
the terms defined in the preamble and recitals hereof shall have the meanings
indicated therein. Capitalized terms not defined herein shall have the meanings
given to them in the Agreement and the Indenture.
Section 1.02. Definitions. As used herein the following terms
shall have the respective meanings set forth or referred to below.
"Business Day" means any day other than (a) a Saturday or
Sunday, (b) a day on which commercial banks in the city in which the corporate
trust office of the Trustee from which payment on the Bonds will be made is
located are authorized by law to close or (c) a day on which the New York Stock
Exchange is closed.
"Capital Additions" means all capital improvements to the
Facility; all Fixtures, furnishings and equipment which the Mortgagor may
certify in writing to be useful and desirable in connection with the operation
of the Facility; and the restoration, reconstruction or replacement of
buildings, equipment or other property damaged or destroyed by fire or other
casualty.
"Collateral" is defined in Section 6.01 of this Mortgage.
"Default Rate" means a per annum rate equal to the Trustee's
prime rate plus two percent (2%); provided, however, that if such rate is
determined to be unenforceable by a court of law, the Mortgagor shall pay actual
damages to the Mortgagee, which shall include, but shall not be limited to, the
loss of use of the unpaid portion of the Note and the administrative costs of
monitoring the default by the Mortgagor. Such administrative costs include, but
are not limited to, attempts to contact the Mortgagor via written and letter
correspondence, generating and reviewing delinquency reports, evaluating the
delinquent account, evaluating the credit file, entering relevant information
into the Mortgagee's file and/or computer, relaying information to management
and different departments, notifying and reporting to management and different
departments, and the like.
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"Environmental Report" means the Phase I Environmental Site
Assessment dated July 31, 1996 and prepared by Recon Environmental Corp.
"Event of Default" is defined in Section 5.01 hereof.
"Facility" means the Land and any buildings and improvements
located on the Land, including the Project and any Capital Additions, and
including, without limiting the generality of the foregoing, all buildings,
structures, Fixtures, furnishings, equipment and other related facilities, real,
personal and mixed, all personal property owned or leased by the Mortgagor, and
all franchises, land, rights-of-way, privileges, easements, licenses, rights and
any other interests in property used or useful in connection with or incident to
such facilities.
"Fixtures" means all goods, fixtures, furnishings, building
materials, and equipment owned by the Mortgagor now or hereafter attached to or
installed or placed in or about the Facility for use as part thereof or in
conjunction with the use and occupancy of the Facility, including, but not
limited to, all materials, supplies, equipment, apparatus, tracks, ramps,
loading platforms, machinery, motors, elevators, escalators, fittings, doors,
windows, signs, pylons, screening, awnings, shades, blinds, carpet, floor
coverings, draperies, furnaces, boilers, gas and oil and electric burners and
heaters, ducts, vents, hoods, flues and registers, hot water heaters, sinks,
stoves, ovens, cabinets, countertops, refrigerators, heating, cooling and air
conditioning equipment, fans, ventilators, wiring, panels, all lighting fixtures
and globes and tubes, time clocks, and other electrical equipment, all
television and radio antenna systems, including satellite dish antennas, and all
plumbing and plumbing fixtures and equipment, sprinklers and sprinkler
equipment, and all trees, plants, shrubs and other landscaping, all of which are
and shall be deemed to be a permanent accession to the Facility, and all
recreational equipment and facilities of all kinds, and water, gas, electrical,
storm and sanitary sewer facilities on the Land to the extent they are owned by
the Mortgagor whether or not situated in easements, together with all
accessions, replacements, betterments and substitutions for any of the foregoing
and the proceeds thereof.
"General Intangibles" means all intangible personal property,
including things in action, now owned or hereafter acquired by the Mortgagor
relating to the Facility, other than goods, accounts, chattel paper, documents,
instruments and money of the Mortgagor and includes, without limitation, all (i)
letters of credit, bonds, guaranties, purchase or sales agreements and other
contractual rights (whether similar or dissimilar), rights to performance, and
claims for damages, refunds (including tax refunds), rights and claims under
insurance policies or other monies due or to become due, (ii) orders,
franchises, permits, certificates, licenses, consents, exemptions, variances,
authorizations or other approvals by any Governmental Authority, (iii)
consulting, engineering and technological information and specifications, design
data, patent rights, trade secrets, literary rights, copyrights, trademarks,
labels, trade names and other intellectual property, (iv) business records,
computer tapes and computer software, (v) goodwill and (vi) all other intangible
personal property, whether similar or dissimilar to the foregoing.
"Governmental Authority" means any government or political
subdivision or any agency, authority, bureau, central bank, commission,
department or instrumentality of either, or any court, tribunal, grand jury or
arbitrator, in each case whether foreign or domestic.
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"Gross Revenues" means all moneys, accounts, receipts,
revenues, income and other moneys received by or on behalf of the Mortgagor from
all sources, including without limitation, the operation, ownership and leasing
of the Facility, and including, without limitation, any revenues received from
the proceeds of any dispositions or financings and all rights to receive the
same whether in the form of accounts receivable, contract rights, chattel paper,
instruments or other rights and the proceeds thereof, and any insurance proceeds
and condemnation awards therefrom to the extent provided in the Agreement or
this Mortgage, whether now existing or hereafter coming into existence and
whether now owned or held or hereafter acquired by the Mortgagor.
"Highest Lawful Rate" means the maximum legal rate of interest
which the Mortgagee is legally entitled to charge, contract for or receive under
any law to which such interest is subject.
"Impositions" means (i) all real estate and personal property
taxes, charges, assessments, excises and levies, and any interest, costs or
penalties with respect thereto, general and special, ordinary or extraordinary,
foreseen and unforeseen, of any kind and nature whatsoever which at any time
prior to or after the execution hereof may be assessed, levied, charged or
imposed upon or with respect to the Mortgaged Property or the ownership, use, or
occupancy or enjoyment thereof, or any portion thereof, or the sidewalks,
streets or alleyways adjacent thereto; (ii) any charges, fees, licenses,
payments or other sums payable for any easement, license or agreement maintained
for the benefit of the Mortgaged Property; and (iii) all water, gas, sewer,
electricity, telephone, garbage collection and other utility charges, rents and
fees appurtenant to or used in connection with the Mortgaged Property which if
unpaid, would become a lien on the Mortgaged Property.
"Land" means the leasehold interest in the real property
described in Exhibit A to this Mortgage granted pursuant to the Lease upon which
the Project will be completed.
"Lease" means the Lease Agreement dated as of November 29,
1984, as the same may be amended or supplemented from time to time.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset, as well as the interest of a vendor or lessor under any conditional sales
agreement, capital lease or other title retention agreement relating to such
asset.
"Mortgaged Property" means the Mortgagor's interest in the
Facility, Fixtures, Gross Revenues, Personalty, General Intangibles, and Rents,
together with all betterments, improvements, additions, alterations and
appurtenances, substitutions, replacements and reversions thereof and thereto
and all reversions and remainders therein and any and all other security and
collateral of every nature whatsoever, now or hereafter given for the
performance and discharge of the amounts due under the Agreement. As used in
this Mortgage, the term Mortgaged Property is
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expressly defined as meaning all or, where the context permits or requires, any
portion of or interest in the Facility, Fixtures, Gross Revenues, Personalty,
General Intangibles, or Rents.
"Permitted Encumbrances" means, as of any particular time, (a)
liens for taxes and special assessments not then delinquent, and any tax,
assessment or judgment liens so long as the validity thereof is being contested
by the Mortgagor in good faith and by appropriate legal proceedings and
execution or sale of the property in question is stayed during the pendency of
such contest, (b) this Mortgage or the liens or encumbrances arising hereunder,
(c) utility, access and other easements and rights-of-way, encroachments and
exceptions which are listed on the title report, (d) the liens arising pursuant
to the Senior Credit Agreement (as defined in the Indenture) and (e) the
encumbrances permitted by the Agreement.
"Person" means and includes any individual, sole
proprietorship, partnership, joint venture, trust, unincorporated organization,
association, corporation, institution, entity, party or government (whether
national, federal, state, county, city, municipal, or otherwise, including,
without limitation, any instrumentality, division, agency, body or department
thereof).
"Personalty" means all of the right, title and interest of the
Mortgagor in and to all inventory, or refundable, returnable or reimbursable
fees, deposits or other funds or evidences of credit or indebtedness deposited
by or on behalf of the Mortgagor with any Governmental Authority, boards,
corporations, providers of utility services (public or private), including
specifically, but without limitation, all refundable, returnable or reimbursable
tap fees, utility deposits, commitment fees and development costs and all other
personal property, including furniture, furnishings, equipment, machinery,
building materials and goods (other than the Fixtures) of any kind or character
as defined in and subject to the UCC and which are now or hereafter located or
to be located upon, within or about the Facility, or which are now being or may
hereafter be used upon, within or about the Facility or which are in any way
related to the ownership, use, leasing, maintenance, repair, alteration,
reconstruction or operation of the Facility, together with all accessions,
replacements and substitutions thereto or therefor and the proceeds thereof.
"Proceeds" means with respect to any property insurance
payment or condemnation award, the amount remaining therefrom after payment of
all expenses incurred in the collection thereof.
"Rents" means all leases, oil, gas or other mineral royalties,
bonuses and rental income, rentals, earnings, income, receipts, revenues, issues
and profits, including, without limitation, insurance, in each case pertaining
to the Mortgaged Property, and all of the Mortgagor's right, title and interest
in and to any awards, settlements or compensation heretofore made or hereafter
to be made by any Governmental Authority for the Mortgaged Property including
through eminent domain or condemnation and those from any vacation of, or any
change of grade in or to any streets affecting the Facility or which may be
received or receivable by the Mortgagor from any hiring, using, letting,
leasing, subhiring, subletting or subleasing of or otherwise from the whole or
any portion or portions of the Facility at any time while any portion of the
amounts due under the Agreement secured hereby remains unpaid.
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"UCC" means the Uniform Commercial Code in effect in the State
of New Jersey.
Section 1.03. Interpretations. The table of contents and
article and section headings of this Mortgage are for reference purposes only
and shall not affect its interpretation in any respect. Except where the context
otherwise requires, words imparting the singular number shall include the plural
number and vice versa.
Section 1.04. References, etc. Any reference in this Mortgage
to a document or instrument shall mean such document or instrument and all
exhibits thereto, as amended or supplemented from time to time. Any reference in
this Mortgage to any Person as a party to any document or instrument shall
include its successors and assigns to such status and in the case of the
Mortgagor shall also include its subsidiaries, if any, which are permitted or
required under generally accepted accounting principles to be consolidated with
the Mortgagor in its financial statements.
Section 1.05. Incorporation of Certain Definitions by
Reference. Each capitalized term used herein and not otherwise defined herein
shall have the meaning provided therefor in the Indenture or the Agreement.
Section 1.06. Accounting Terms and Determinations:
Incorporation of UCC Definitions. Unless otherwise specified herein, all
accounting terms used herein shall be interpreted, all accounting determinations
hereunder shall be made, and all financial statements required to be delivered
hereunder shall be prepared in accordance with generally accepted accounting
principles as in effect from time to time, applied on a consistent basis. Except
as otherwise defined or indicated by the context herein, all terms which are
defined in the UCC shall have their respective meanings as used in Article 9 of
the UCC.
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ARTICLE II
GRANT OF INTEREST AND ASSIGNMENT OF MORTGAGE
Section 2.01. Grant of Interest. For the purpose of securing
the payment, performance and discharge of the amounts due under the Agreement,
the Mortgagor does hereby irrevocably GIVE, TRANSFER, GRANT, BARGAIN, SELL,
ASSIGN, MORTGAGE, CONVEY AND WARRANT to the Mortgagee all of the Mortgagor's
estate, right, title and interest in and to the Lease and the leasehold interest
created thereby and the Mortgaged Property, whether now owned or held or
hereafter acquired by the Mortgagor to have and to hold the Mortgaged Property
unto the Mortgagee, its successors and assigns forever, and the Mortgagor does
hereby bind itself, its successors and assigns, at its sole expense, to warrant
and forever defend the title to the Mortgaged Property unto the Mortgagee
against every Person whomsoever lawfully claiming or to claim the same or any
part thereof; provided that the Mortgagor shall be permitted to grant or to
continue to exist any Permitted Encumbrances; provided further, however, that if
the Mortgagor shall pay or cause to be paid the amounts due under the Agreement
as and when the same shall become due and payable and shall perform and
discharge or cause to be performed and discharged the amounts due under the
Agreement on or before the date the same are to be performed and discharged,
then this Mortgage and the estate and rights granted hereby shall be null and
void, otherwise to remain in full force and effect.
Section 2.02. Assignment of Mortgage. The Mortgagee will
assign this Mortgage to the Trustee pursuant to the Indenture. The Mortgagor
consents to said assignment and agrees to pay directly to the Trustee amounts
due to the Trustee under this Mortgage without any defense, set off or
counterclaim arising out of any default on the part of the Mortgagee under this
Mortgage or any transaction between the Mortgagor and the Mortgagee. The
Mortgagor agrees that the Trustee may exercise all rights granted to the
Mortgagee hereunder, subject to the Mortgagee's retention of rights as described
in the Indenture, for so long as no Event of Default by the Mortgagee has
occurred and is continuing.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
The Mortgagor hereby unconditionally warrants and represents
to the Mortgagee (which representations and warranties will survive the creation
and performance of the Mortgagor's obligations hereunder) as follows:
Section 3.01. Warranties of Title.
(a) The Mortgagor has good and marketable title to the
Mortgaged Property, free and clear of every Lien, other than the Permitted
Encumbrances;
(b) The Mortgagor is lawfully and indefeasibly seized with a
leasehold interest , in the Land, and has full corporate power to grant, convey
and mortgage the Mortgaged Property to the Mortgagee;
(c) The Mortgagor will forever warrant and defend the title to
the Mortgaged Property unto the Mortgagee against the claims and demands of all
Persons whomsoever except those claiming under the Permitted Encumbrances; and
(d) The Mortgagor has not entered into any sales agreement,
option, assignment, sublease, pledge, mortgage, deed of trust, financing
statement, security agreement or any other arrangement regarding the Mortgaged
Property apart from the Agreement and Permitted Encumbrances.
Section 3.02. Lien of this Mortgage. This Mortgage constitutes
a valid and subsisting first mortgage lien on the Mortgagor's leasehold interest
in the Facility, a valid and subsisting first security interest in the Equipment
of the Mortgagor financed with the proceeds of the Bonds and a valid and
subsisting subordinate security interest in and to the Gross Revenues, Fixtures,
Personalty in accordance with the terms hereof.
Section 3.03. Financings. The only financings secured by the
Mortgaged Property are the Bonds and the Agreement and those executed in
connection with Permitted Encumbrances.
Section 3.04. Impositions and Other Payments. The Mortgagor
has filed all ad valorem tax returns required to be filed by the Mortgagor by
all Governmental Authorities having jurisdiction over the Mortgaged Property and
has paid all other Impositions which have become due pursuant to such returns or
pursuant to any assessments received by the Mortgagor and the Mortgagor knows of
no basis for any additional assessment against the Mortgaged Property in respect
of any Impositions. The Mortgagor shall pay all Impositions not later than their
respective due dates, and not later than ten (10) days after such dates shall
produce to the Mortgagee, if so requested, receipts for the payment thereof. The
Mortgagor has paid or will pay in full when due (except for such retainages as
may be permitted or required by any Governmental Authority or by the terms of
any applicable construction or related contract to be withheld by the Mortgagor
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pending completion of the Project), all sums owing for labor, material,
supplies, personal property (whether or not forming a Fixture hereunder) and
services of every kind and character used, furnished or installed in or on the
Mortgaged Property.
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ARTICLE IV
COVENANTS AND OBLIGATIONS OF THE MORTGAGOR
To protect and maintain the security of this Mortgage, in
addition to the covenants set out in the Agreement, the Mortgagor
unconditionally covenants with the Mortgagee as follows, which covenants are,
according to their terms, of the essence hereof and will survive the delivery of
this Mortgage:
Section 4.01. Defects in Title. The Mortgagor will proceed
with diligence to correct any defect in title to the Mortgaged Property, should
any such defect be found to exist after the execution and delivery of this
Mortgage, and in this connection, should it be found after the execution and
delivery of this Mortgage, that there exists upon the Mortgaged Property any
Lien (other than a Permitted Encumbrance), equal, inferior, or superior in rank
or priority to the lien and security interests created by this Mortgage (other
than the Permitted Encumbrances), or should any such Lien hereafter arise, then,
unless the Mortgagee shall have given specific prior written consent to the
creation or continuation thereof (other than Permitted Encumbrances), the
Mortgagor will promptly discharge and remove any such Lien from the Mortgaged
Property. The Mortgagor further agrees that the Mortgagee may take any action
the Mortgagee deems advisable to protect and preserve its interest in the
Mortgaged Property and, in such event, the Mortgagor will indemnify the
Mortgagee against any and all reasonable costs, including reasonable attorneys'
fees, and other expenses which the Mortgagee may incur in defending against any
such adverse claims after providing notice thereof to the Mortgagor.
Section 4.02. Maintenance and Repair. The Mortgagor shall, at
its own expense, do or cause to be done all things necessary to preserve and
keep in full repair, working order and efficiency all of the Mortgaged Property,
as provided in the Agreement.
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ARTICLE V
EVENTS OF DEFAULT; REMEDIES
Section 5.01. Event of Default.
(a) Any of the following events shall be considered an Event
of Default under this Mortgage:
(i) the Mortgagor shall fail to make any payment
required under the Agreement when the same shall become due
and payable or shall fail to make any other payment required
under this Mortgage within 30 days of when the same shall
become due and payable; or
(ii) if an Event of Default shall occur and be
continuing hereunder or under the Agreement or the Indenture;
or
(iii) the Mortgagor shall violate or fail to perform
any term, covenant, condition or agreement set forth in or
arising under this Mortgage and such failure continues for 30
days after the Mortgagee gives the Mortgagor written notice
thereof; provided however, that if such performance requires
work to be done, actions to be taken, or conditions to be
remedied, which by their nature cannot reasonably be done,
taken or remedied, as the case may be, within such 30-day
period, no Event of Default shall be deemed to have occurred
or to exist if, and so long as, the Mortgagor shall commence
such performance within such 30-day period and it shall
diligently and continuously prosecute the same and such breach
is remedied within 90 days after written notice thereof is
given; provided that the Mortgagor may have such longer period
to remedy any such breach as may be permitted with the consent
of the Mortgagee.
(b) Should an Event of Default occur hereunder, in addition to
all rights and remedies hereinafter described, the Mortgagee shall become and be
entitled to, as of right, without notice and without regard to the adequacy of
the Mortgaged Property as security for the payments due under the Agreement
hereby secured:
(i) proceed in an action at law, suit in equity or
any other appropriate proceedings and enforce the rights of
this Mortgage, whether by the foreclosure of the Lien of this
Mortgage or for the specific performance of any agreement
contained herein, or for an injunction against the violation
of any of the terms hereof;
(ii) exercise any and all other rights and remedies
afforded to the Mortgagee in and against the Mortgaged
Property or the Mortgagor by applicable law, including the
UCC; and
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(iii) exercise any or all other rights, remedies or
recourses at law, in equity, or set forth in this Mortgage,
the Agreement, the Intercreditor Agreement, the Landlord
Agreement, the Senior Credit Agreement or the Indenture.
Section 5.02. Remedies. If an Event of Default shall occur as
provided in Section 5.01 hereof, the Mortgagee, or an attorney or agent for the
Mortgagee, without bringing any action or proceeding, or by a receiver to be
appointed by a court in any appropriate action or proceeding, may do all or any
of the following, subject to the terms of the Agreement, the Intercreditor
Agreement, the Landlord Agreement and the Indenture:
(a) Subject to the requirements of any Governmental Authority
having jurisdiction over the Project, enter upon and take exclusive possession
of the Mortgaged Property or any part thereof, including all books, records and
accounts relating thereto;
(i) do any and all acts which the Mortgagee deems
proper to protect the security hereof, including, for the
account of the Mortgagor, making all payments the Mortgagor is
obligated to make under the Agreement;
(ii) cause the construction or completion of
construction of the Project or any Capital Addition;
(iii) enter into the Mortgaged Property without being
liable for any prosecution or damages therefor and may
dispossess the Mortgagor and may lease the Mortgaged Property
or any part thereof to another party for a term which may
extend beyond the term of the Agreement and receive the rent
therefor, upon such terms as shall be satisfactory to the
Mortgagee and in accordance with the requirements of any
applicable Governmental Authority;
Such entry by the Mortgagee shall not operate to release the
Mortgagor from any sums to be paid or covenants to be
performed under the Agreement during the full term thereof. In
addition, the Mortgagor agrees that the receipt of rents,
awards, and any other moneys or evidences thereof, and any
disposition of the same by the Mortgagee shall not constitute
a waiver of the right of foreclosure and sale of the Mortgaged
Property by the Mortgagee in the case of an Event of Default.
For the purpose of leasing the Mortgaged Property to another
party, the Mortgagee shall be authorized to make such repairs
or alterations in or to the Mortgaged Property as the
Mortgagee may deem necessary to place the same in good order
and condition. The Mortgagor shall be liable to the Mortgagee
for the cost of such repairs or alterations and all expenses
of such leasing. If the sum realized or to be realized from
the leasing is insufficient to satisfy the sum payable by the
Mortgagor under the Agreement, the Mortgagee, at its option,
may require the Mortgagor to pay such deficiency month by
month, or may hold the Mortgagor liable in advance for the
entire deficiency to be realized during the term of the
leasing of the Mortgaged Property. Notwithstanding such entry
by the Mortgagee, the Mortgagor agrees that it shall not
discontinue or take any action to cause the discontinuance of
any utility
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service (including heat) furnished to the Mortgaged Property
prior to such entry and the Mortgagor further agrees any such
utility service shall continue to be furnished to the
Mortgaged Property at the expense of the Mortgagor.
(iv) perform any and all conditions and undertakings
of any agreement or commitment entered into between the
Mortgagor and any Person, including the Mortgagee, provided,
however, that if the Mortgagor retains possession of all or
any part of the Mortgaged Property after an Event of Default
and without the Mortgagee's prior written consent thereto, the
Mortgagee may invoke any and all legal remedies to dispossess
the Mortgagor available to the Mortgagee by applicable law;
provided that the foregoing shall not be construed to impose
any greater obligation or any prerequisites to acquiring
possession of the Mortgaged Property after an Event of Default
than would have existed in the absence of such sentence; and
(b) Either with or without taking possession of the Mortgaged
Property, either by itself or by any other Person, in such manner, for such time
and upon such terms that the Mortgagee may deem to be prudent or reasonable
under the circumstances (making such repairs, alterations, additions and
improvements thereto and taking any and all other action with reference thereto
from time to time as the Mortgagee may deem necessary or desirable), hold,
lease, manage, operate or otherwise use or permit the use of the Mortgaged
Property and collect and receive the Rents, including accrued and unpaid Rents,
issue binding receipts therefor, and apply the same, less costs of operation and
collection (including, but not limited to, the reasonable costs, expenses and
fees of a receiver, if any), upon the payments to be made under the Agreement
secured by this Mortgage. The receipt by the Mortgagee of any Rents, pursuant to
the foregoing, whether prior to or during the pendency of sale proceedings under
this Mortgage, shall not cure such default, nor affect said notice or
proceedings or any sale pursuant thereto, but such Rents, less costs as
aforesaid, shall be applied in reduction of the payments to be made under the
Agreement; and
(c) The Mortgagee may commence foreclosure proceedings on all
or any portion of the real property comprising a part of the Mortgaged Property,
or on any interest in any part thereof it selects, by statutory power of sale or
action brought in its own name as plaintiff in a court of competent
jurisdiction, in the manner provided by law, and the filing of a complaint to
foreclose the same, to the extent permitted by applicable law, shall be
conclusive notice of the due exercise of such option; or the Mortgagee may
execute and deliver to the Mortgagor written notice of such breach, default or
other Event of Default and of its election to cause this Mortgage to be
foreclosed by action to be brought by the Mortgagee as plaintiff in a court of
competent jurisdiction in the manner provided by law, as aforesaid; and
thereafter the Mortgagee shall bring such action. In case of any sale under this
Mortgage, whether by judicial proceedings or otherwise, the Mortgaged Property
(and Mortgagor's interest therein) may be sold in one parcel and as an entirety
or in such parcels (or interests), manner or order as the Mortgagee in its sole
discretion may elect. In the event of foreclosure of this Mortgage by action
brought by the Mortgagee as aforesaid, there shall also be, and is, secured
hereby, the payment of all reasonable costs and expenses, including, without
limitation, cost of search or other evidence of insurance of title, for the
benefit and protection of the Mortgagee, and attorneys' fees and expenses
(including attorneys'
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fees and expenses on appeal or arising out of any action in bankruptcy) in a
reasonable sum to be fixed by the court in any such action brought to foreclose
the same, whether such foreclosure action progresses to judgment or not; and the
filing of a complaint in any such action shall render due and payable by the
Mortgagor such cost of search or evidence of insurance of title and attorneys'
fees.
Section 5.03. Application of Proceeds. The proceeds of any
sale of the Mortgaged Property shall be applied by the Mortgagee (or the
receiver if one is appointed) to the extent that funds are so available to the
following or in such order of priority that the Mortgagee, in its sole
discretion may determine, subject to the requirements of State law:
(a) First, to pay all costs and expenses incident to such
sale, including, without limitation, all costs, charges, reasonable attorneys',
accountants', brokers' and appraisers' fees and expenses of the Mortgagee
incident to such sale, including, but not limited to, the fees and other costs
herein provided for, to pay all monies advanced by or on behalf of the Mortgagee
for the payment of the Impositions, insurance premiums or other payments in
connection with the maintenance and protection of any part of the Mortgaged
Property to the Mortgagee, with interest thereon at the Default Rate and to pay
a commission or fee to the court official or other person making the sale, equal
to the commission or fee allowed for making sales of property under applicable
law or decree of the equity court having jurisdiction, if any, in the event of
the judicial foreclosure of this Mortgage;
(b) Second, to pay the cost of any search and other evidence
of insurance of title procured for the benefit of the Mortgagee in connection
with such sale and documentary stamps on the Mortgagee's deed, if applicable;
and
(c) Third, to pay the amounts due under the Agreement.
Section 5.04. Delivery of Possession. Any sale or sales of the
Mortgaged Property, or any part thereof, under or by virtue of judicial
proceedings, regardless of the price paid for the Mortgaged Property or any part
thereof, shall, to the extent permitted by applicable law, operate to divest all
right, title, interest, claim and demand whatsoever, either at law or in equity,
of the Mortgagor of, in and to the Mortgaged Property and the property sold, and
shall be a perpetual bar, both at law and equity, against the Mortgagor, its
successors and assigns and against any and all Persons claiming or who shall
thereafter claim all or any portion of the property sold from, through, or under
the Mortgagor, its successors or assigns and the Mortgagor, if requested by the
Mortgagee so to do, shall join in the execution and delivery of all property
conveyances, assignments, and transfers of the property so sold. The rights of
the Mortgagee to possession or for a receiver are of the essence hereof, and
shall continue during the running of the period allowed by law for the
reinstatement of the amounts due under the Agreement secured hereby and
thereafter until sale of the Mortgaged Property. The Mortgagor hereby expressly
waives and relinquishes any and all rights the Mortgagor may have by statute or
otherwise to the possession of said Mortgaged Property and the Rents during
pendency of a sale or foreclosure of this Mortgage. The Mortgagor agrees for
itself and any and all Persons claiming by, through or under the Mortgagor that
if the Mortgagor shall hold possession of the Mortgaged Property or any part
thereof subsequent to sale
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or foreclosure hereunder, the Mortgagor, or the parties so holding possession,
shall become and be considered as tenants at will of the purchaser or purchasers
of such foreclosure sale; and any such tenant failing or refusing to surrender
possession upon demand shall be guilty of forcible detainer and shall be liable
to such purchaser or purchasers for reasonable rental on said Mortgaged Property
and shall be subject to eviction and removal, forcible or otherwise, with or
without process of law, damages which may be sustained by the Mortgagor or any
such tenant as a result thereof being hereby expressly waived.
Section 5.05. Appointment of Receiver. Prior to, upon or at
any time after commencement of foreclosure of the Lien and security interest
provided for herein or any legal proceedings hereunder, the Mortgagee shall have
the right, to the extent permitted by applicable law, to make an application to
a court of competent jurisdiction, as a matter of strict right and without
notice to the Mortgagor, for the appointment of a receiver of the Mortgaged
Property and the Mortgagor hereby irrevocably consents to such an appointment.
Any such receiver shall have all the usual powers and duties of receivers in
similar cases including the full power to maintain and operate the Mortgaged
Property upon such terms as may be approved by the court and any applicable
Governmental Authority.
Section 5.06. Remedies Cumulative, Concurrent and
Non-Exclusive. The Mortgagee shall have all the rights, remedies and recourses
granted herein, in the Agreement and as available at law or equity (including
specifically those granted by the UCC), and the same:
(a) shall be cumulative and concurrent;
(b) may be pursued separately, successively or concurrently
against the Mortgagor, or against the Mortgaged Property, at the sole discretion
of the Mortgagee;
(c) may be exercised as often as occasion therefor shall
arise, it being agreed by the Mortgagor that the failure to exercise any of same
shall in no event be construed as a waiver or release thereof or of any other
right, remedy or recourse of the Mortgagee; and
(d) are intended to be, and shall be, non-exclusive.
Section 5.07. No Conditions Precedent to Exercise of Remedies.
The Mortgagor will not be relieved from the payment of the amounts due under or
fulfillment of the conditions of the Agreement by reason of:
(a) the failure of the Mortgagee to comply with any request of
the Mortgagor, or any other Person so obligated to enforce any provisions of the
Agreement;
(b) the release, regardless of consideration, of the Mortgaged
Property or the addition of any other property to the Mortgaged Property;
(c) any agreement or stipulation between any subsequent owner
of the Mortgaged Property and the Mortgagee extending, renewing, rearranging or
in any other way
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modifying the terms of the Agreement without first having obtained the consent
of, given notice to, or paid any consideration to the Mortgagor, who, in such
event, shall continue to be liable to make payment according to the terms of any
such extension or modification agreement unless expressly released and
discharged in writing by the Mortgagee; or
(d) any other act or occurrence, save and except the complete
payment and satisfactory fulfillment of all of the amounts due under the
Agreement.
Section 5.08. Extension, Rearrangement or Renewal of the
Amounts Due under the Agreement. It is expressly agreed that any of the amounts
due under the Agreement which are secured hereby may be from time to time
extended for any period, rearranged, modified, or renewed and that any part of
the security herein described, or any other security for the amounts due under
the Agreement, may be waived or released without in any way altering, varying or
diminishing the force, effect or Lien of this Mortgage; and the Lien and
security interests granted by this Mortgage shall continue as a prior Lien on
and security interest in all of the Mortgaged Property not expressly so
released, until all sums with interest and charges hereby secured are fully
paid; and no other security now existing or hereafter taken to secure the
payment of the amounts due under the Agreement or any part thereof or the
performance of any obligation or liability whatsoever shall in any manner impair
or affect the security given by this Mortgage and all security for the payment
of the amounts due under the Agreement or any part thereof and the performance
of any obligation or liability shall be taken, considered and held as
cumulative.
Section 5.09. Waiver of Redemption, Notice and Marshalling of
Assets. To the fullest extent permitted by applicable law, the Mortgagor hereby
irrevocably and unconditionally waives and releases:
(a) all benefits that might accrue to the Mortgagor by virtue
of any present or future law exempting the Mortgaged Property from attachment,
levy or sale on execution or providing for any appraisal, valuation, stay of
execution, exemption from civil process, redemption or extension of time for
payment;
(b) except as expressly provided herein or in the Agreement,
all notices of any Event of Default or of the Mortgagee's election to exercise
or the Mortgagee's actual exercise of any right, remedy or recourse provided for
hereunder or under the Agreement;
(c) any right to a marshalling of assets, right to direct the
order in which such property, if consisting of several known lots or parcels,
shall be sold, or right to a sale in inverse order of alienation; and
(d) the pleading of any statute of limitations as a defense to
any and all amounts due under the Agreement secured by this Mortgage;
and covenants not to hinder, delay or impede the execution of any power herein
granted or delegated to the Mortgagee, but to suffer and permit the execution of
every power as though no such law or laws had been made or enacted.
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Section 5.10. Repayment of Expenses. Repayment of all expenses
incurred by the Mortgagee hereunder or payments made by the Mortgagee on behalf
of the Mortgagor hereunder, or under the Agreement, together with interest
thereon shall be secured by this Mortgage; following the occurrence of an Event
of Default, interest thereon shall be at the Default Rate.
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ARTICLE VI
SECURITY AGREEMENT
Section 6.01. Security Agreement. To the extent that the
Mortgaged Property may be subject to the UCC, this Mortgage shall also
constitute and serve as a security agreement on personal property within the
meaning of, and shall constitute a security interest under, the UCC with respect
to the Mortgaged Property which is subject to the UCC, including without
limitation, the Gross Revenues, Personalty, General Intangibles, Fixtures, and
Rents associated with the Project (collectively, the "Collateral"). To this end,
the Mortgagor has GRANTED, BARGAINED, CONVEYED, ASSIGNED, TRANSFERRED and SET
OVER and by these presents does GRANT, BARGAIN, CONVEY, ASSIGN, TRANSFER and SET
OVER unto the Mortgagee a security interest in all of the Mortgagor's right,
title and interest in, to and under all Fixtures and all of the other Mortgaged
Property not constituting real property under the laws of the State of New
Jersey to secure the full and timely payment and the full and timely performance
and discharge of the amounts due under the Agreement. Subject to the terms of
the Intercreditor Agreement and the Landlord Agreement, upon any Event of
Default of the Mortgagor hereunder, the Mortgagee shall be entitled to exercise
with respect to the Collateral all of the rights and remedies set forth herein
and in the Agreement or otherwise afforded to a secured party under the terms of
the UCC, any or all of which remedies or rights may be pursued and exercised
concurrently, consecutively, alternatively or otherwise. The Mortgagor will
execute, file and refile, at the sole cost and expense of the Mortgagor, one or
more supplemental security agreements and financing statements as the Mortgagee
may from time to time require covering any property now or hereafter
constituting a portion of the Mortgaged Property securing the amounts due under
the Agreement secured hereunder and such financing statements and other and
further assurances as the Mortgagee may request to perfect or evidence the
security interest herein created and to particularize and identify the
Collateral. The Mortgagor hereby authorizes the Mortgagee to file such financing
statement or statements pursuant to the UCC, without the signature of the
Mortgagor, as the Mortgagee may deem necessary, to perfect such interests or
right in its favor. It is the intent of the Mortgagor and the Mortgagee that
this Mortgage encumber all Rents and as to all items contained in the definition
of Rents which are included in the UCC, be covered by the security interests
granted in this Article VI and that all items contained in the definition of
Rents which are excluded from the UCC be covered by the provisions of Article II
and Article VII hereof.
Section 6.02. Fixture Filing. This Mortgage shall also
constitute a UCC financing statement (the "Fixture Filing") for all Personalty
or Fixtures, now or hereafter so affixed by or on behalf of the Mortgagor to the
Mortgaged Property so that such becomes a fixture in accordance with the UCC.
Information containing the security interest herein granted may be obtained at
the addresses set forth herein. The address of the Mortgagee as the "Secured
Party" and the address of the Mortgagor as the "Debtor" are the addresses set
forth in Section 9.07 hereof.
Section 6.03. Security Agreement: Remedies. If an Event of
Default shall occur, the Mortgagee may, subject to the terms of the
Intercreditor Agreement and the Landlord
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Agreement, in addition to exercising any and all other rights, remedies and
recourses set forth in Article V hereof, take any or all of the following
actions without notice to the Mortgagor (except where expressly required below
or in the Agreement):
(a) Declare all or part of the amounts due under the Agreement
immediately due and payable in accordance with the terms of the Indenture, and
enforce payment and performance of the same by the Mortgagor;
(b) Proceed in the manner set forth in the applicable
provision of the UCC relating to the procedure to be followed when a security
agreement covers both real and personal property;
(c) Take possession of the Collateral, or at the Mortgagee's
request, the Mortgagor shall, at the Mortgagor's cost, assemble the Collateral
and make it available at a location to be specified by the Mortgagee which is
reasonably convenient to the Mortgagor and the Mortgagee. In any event, the risk
of accidental loss or damage to, or diminution in value of, the Collateral shall
be on the Mortgagor, and the Mortgagee shall have no liability whatsoever for
failure to obtain or maintain insurance, nor to determine whether any insurance
ever in force is adequate as to amount or as to risk insured;
(d) Sell, in one or more sales and in one or more parcels, or
otherwise dispose of any or all of the Collateral in any commercially reasonable
manner as the Mortgagee may elect, in a public or private transaction, at any
location as deemed reasonable by the Mortgagee either for cash or credit or for
future delivery at such price as the Mortgagee may deem fair, and unless
prohibited by the UCC, the Mortgagee may be the purchaser of any or all
Collateral so sold and may apply upon the purchase price therefor any amounts
due under the Agreement secured hereby;
Any sale pursuant to this paragraph (d) shall be upon at least
five days notice to the Mortgagor, which the Mortgagor agrees is reasonable. Any
such sale or transfer by the Mortgagee either to itself or to any other Person
shall be absolutely free from any claim or right by the Mortgagor, including any
equity or right of redemption, stay or appraisal which the Mortgagor has or may
have under any rule of law, regulation or statute now existing or hereafter
adopted. Upon any such sale or transfer, the Mortgagee shall have the right to
deliver, assign and transfer to the purchaser or transferee thereof the
Collateral so sold or transferred. It shall not be necessary that the Collateral
or any part thereof be present at the location of any such sale or transfer. The
Mortgagee may, at its discretion, provide for a public sale, and any such public
sale shall be held at such time or times within ordinary business hours and at
such place or places as the Mortgagee may fix in the notice of such sale. The
Mortgagee shall not be obligated to make any sale pursuant to any such notice.
The Mortgagee may, without notice or publication, adjourn any public or private
sale by announcement at any time and place fixed for such sale, and such sale
may be made at any time or place to which the same may be so adjourned. In the
event any sale or transfer hereunder is not completed or is defective in the
opinion of the Mortgagee, such sale or transfer shall not exhaust the rights of
the Mortgagee hereunder, and the Mortgagee shall have the right to cause one or
more subsequent sales or transfers to be made hereunder. In the event that any
of the Collateral is sold or transferred on credit, or is to be held by the
Mortgagee for future delivery to a
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purchaser or transferee, the Collateral so sold or transferred may be retained
by the Mortgagee until the purchase price or other consideration is paid by the
purchaser or transferee thereof, but in the event that such purchaser or
transferee fails to pay for the Collateral so sold or transferred or to take
delivery thereof, the Mortgagee shall incur no liability in connection
therewith. If only part of the Collateral is sold or transferred such that the
amounts due under the Agreement remain outstanding (in whole or in part), the
Mortgagee's rights and remedies hereunder shall not be exhausted, waived or
modified, and the Mortgagee is specifically empowered to make one or more
successive sales or transfers until all the Collateral shall be sold or
transferred and all the amounts due under the Agreement are paid. In addition to
all of the rights and remedies set forth herein, the Mortgagee shall have all
the rights and remedies of a "secured party" under the UCC.
(e) Take possession of all books and records of the Mortgagor
pertaining to the Collateral. The Mortgagee shall have the authority to enter
upon the Facility in order to obtain any such books or records, or any
Collateral located thereon, and remove the same therefrom without liability;
(f) Apply the proceeds of the disposition of Collateral to the
amounts due under the Agreement in the manner and priority provided in Section
5.03 of this Mortgage. Such application may include, without limitation, the
reasonable expenses of retaking, holding, preparing for sale or other
disposition, and reasonable attorneys' fees and legal expenses incurred by the
Mortgagee (including reasonable attorneys' fees on appeal or incurred in
connection with any bankruptcy proceeding); and
(g) Appoint any party as agent to perform any act or acts
necessary or incident to any sale or transfer by the Mortgagee of the
Collateral.
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ARTICLE VII
ASSIGNMENT OF RENTS
Section 7.01. Assignment of Rents. For Ten Dollars ($10.00)
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Mortgagor has GRANTED, BARGAINED, SOLD and CONVEYED
and by these presents does GRANT, BARGAIN, SELL and CONVEY absolutely unto the
Mortgagee, the Rents subject only to Permitted Encumbrances applicable thereto
and the hereinafter referenced limited license; TO HAVE AND TO HOLD the Rents
unto the Mortgagee forever and the Mortgagor does hereby bind itself, its
successors and assigns to warrant and forever defend the title to the Rents unto
the Mortgagee against every Person whomsoever lawfully claiming or to claim the
same or any part thereof; provided, however, if the Mortgagor pays or causes to
be paid the amounts due under the Agreement as and when the same shall become
due and payable and shall perform and discharge or cause to be performed and
discharged the amounts due under the Agreement on or before the date the same
are to be performed and discharged, then this assignment of Rents shall
terminate and be of no further force and effect, and all rights, titles and
interests conveyed pursuant to this assignment of Rents shall become revested in
the Mortgagor without the necessity of any further act or requirement by the
Mortgagor or the Mortgagee.
Section 7.02. Rights of the Mortgagor's Limited License. The
Mortgagee hereby grants to the Mortgagor a limited revocable license,
non-exclusive with the rights of the Mortgagee reserved in Section 7.04 hereof
to exercise and enjoy all incidences of ownership of the Rents, including
specifically, but without limitation, the right to collect, demand, ▇▇▇ for,
attach, levy, recover and receive the Rents and to give proper receipts,
releases and acquittances therefor, prior to any default in the payment of any
amounts due under the Agreement secured hereby, to collect, deliver, disburse
and use all such Rents and exercise all rights under the Rents if not otherwise
restricted under the Agreement. This limited license shall be automatically
revoked without notice upon the occurrence of an Event of Default.
Section 7.03. Enforcement of Rents.
(a) So long as the limited license is in effect, the Mortgagor
shall:
(i) duly and punctually perform and comply with any
and all representations, warranties, covenants and agreements
expressed as binding upon the Mortgagor as landlord under any
lease or agreement;
(ii) maintain each of the leases or agreements in
full force and effect during the term thereof;
(iii) appear in and defend any action or proceeding
in any manner connected with any lease or agreement;
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(iv) deliver to the Mortgagee such further
information or estoppels, and execute and deliver to the
Mortgagee such further assurances and assignments, with
respect to any leases or agreements as the Mortgagee may from
time to time request; and
(v) notify the Mortgagee immediately of any default
asserted by any party (including any guarantor) under any
agreement.
(b) Without the Mortgagee's prior written consent, the
Mortgagor shall not, except as permitted in the Agreement:
(i) grant concessions, do or knowingly permit to be
done anything to impair the value of any of the leases or
agreements; or
(ii) assign or grant a security interest in or to the
limited license or any of the Rents, leases or agreements; or
(iii) receive or collect Rents from any tenant,
subtenant, undertenant, or other occupant of any part of the
Mortgaged Property, more than one month in advance of the due
date or in any amount greater than that permitted by law.
Section 7.04. Suits and Attornment. The Mortgagee hereby
reserves and may exercise the right and the Mortgagor hereby acknowledges that
the Mortgagee has the right (but not the obligation) to collect, demand, ▇▇▇
for, attach, levy, recover and receive any Rents, to give proper receipts,
releases and acquittances therefor and, after deducting the expenses of
collection, to apply the net proceeds thereof as a credit upon the amounts due
under the Agreement. The Mortgagor hereby authorizes and directs any Person or
lessee of the Mortgaged Property to deliver any such payments to, and otherwise
to attorn all other obligations under any lease or agreement directly to the
Mortgagee in accordance herewith. The Mortgagor hereby ratifies and confirms all
that the Mortgagee shall do or cause to be done by virtue of this Section 7.04.
Section 7.05. Conflict. The absolute assignment contained in
this Article VII is in addition to, and not in lieu of, Article II hereof. It is
the intent of the parties that no conflict exist between the absolute assignment
contained in this Article VII and the collateral conveyance contained in Article
II hereof. However, if and to the extent such conflict is perceived to exist as
to the Rents, such conflict shall be resolved in favor of the absolute
assignment contained in this Article VII.
Section 7.06. Assignment of Rents; Remedies. Upon the
occurrence of an Event of Default, the limited license shall immediately
terminate without any notice or other further action being required of the
Mortgagee. Thereafter, the Mortgagee shall have the exclusive right, power and
authority to take any and all action in connection with the Rents, regardless of
whether a foreclosure or sale of the remainder of the Mortgaged Property has
occurred under this Mortgage or whether the Mortgagee has taken possession of
the remainder of the Mortgaged Property or attempted to do any of the same. The
Mortgagee may make such expenditures, including
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reasonable counsel fees, in connection therewith and each amount so paid or
expended with interest at the Default Rate shall become part of the amounts due
under the Agreement and be secured hereby. The Mortgagee, may, at its option,
have the right to apply to a court to have all Rents paid into a court registry
pending adjudication of the Mortgagee's rights to such Rents. No action referred
to in this Article VII taken by the Mortgagee shall constitute an election of
remedies.
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ARTICLE VIII
ENVIRONMENTAL REPRESENTATIONS AND COVENANTS
Section 8.01. Definitions. As used in this Article VIII, the
following terms shall have the following meanings:
(a) Clean-Up: Investigation, sampling, monitoring (including
the installation of monitoring ▇▇▇▇▇), removal, abatement and/or remediation of,
or other response to, Environmental Conditions as required or directed by
applicable Governmental Authorities with jurisdiction therefor, or as required
by and in compliance with Environmental Laws.
(b) Environmental Conditions: Any environmental contamination
or pollution or threatened contamination or pollution of, or the Release or
threatened Release of Hazardous Substances into, surface soils, subsurface
soils, sewage systems, surface water, groundwater, land or air.
(c) Environmental Documents: (i) Any and all documents
received or submitted by the Mortgagor from the United States Environmental
Protection Agency, the New Jersey Department of Environmental Protection and/or
any state, county or municipal environmental or health agency concerning
environmental matters relating to the Mortgaged Property or the Mortgagor's
operations upon the Mortgaged Property; and (ii) any and all non-privileged
reviews, audits, reports, workplans, proposals or analyses concerning
Environmental Conditions including, but not limited to, the presence or absence
of Hazardous Substances on, at, under, emanating from, relating to or
surrounding the Mortgaged Property, that have been prepared by or on behalf of
the Mortgagor or are otherwise in the Mortgagor's possession, custody or
control.
(d) Environmental Laws: Any and all federal, state, regional
and local laws, statutes, codes, ordinances, regulations or rules (including,
but not limited to, consent decrees and judicial or administrative orders or
decrees or other legal requirements of any kind issued in connection with the
Mortgaged Property) relating to pollution or contamination of the environment,
Environmental Conditions, or the use, handling, generation, treatment, storage,
disposal, manufacture or transport of Hazardous Substances, presently in effect
or hereafter amended, modified or adopted from time-to-time during the Mortgage
term including, but not limited to, the Comprehensive Environmental Response,
Compensation and Liability Act ("CERCLA" or the "Federal Superfund Act") as
amended by the Superfund Amendments and Reauthorization Act of 1986 ("▇▇▇▇") (42
U.S.C. ss. 9601-9675); the Resource Conservation and Recovery Act of 1976, as
amended ("RCRA") (42 U.S.C. ss. 6901, et seq.); the Clean Water Act, as amended
(33 U.S.C. ss. 1251, et seq.); the Clean Air Act, as amended (42 U.S.C. ss.
7401, et seq.); the Federal Insecticide, Fungicide and Rodenticide Act, as
amended ("FIFRA") (7 U.S.C. ss. 136, et seq.); The Hazardous Materials
Transportation Act, as amended (49
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U.S.C. Section 1801, et seq.); the Toxic Substances Control Act (15 U.S.C. 2601,
et seq.); the New Jersey Spill Compensation and Control Act, as amended (the
"Spill Act") (N.J.S. 58:10-23.11, et seq.); the Industrial Site Recovery Act, as
amended ("ISRA") (N.J.S. 13:1K-6, et seq.); the New Jersey Solid Waste
Management Act, as amended (N.J.S. 13:1E-1, et seq.); the New Jersey Underground
Storage of Hazardous Substances Act ("New Jersey UST Act"), as amended (N.J.S.
58:10A-21, et seq.); the New Jersey Water Pollution Control Act, as amended
(N.J.S. 58:10A-1, et seq.); the New Jersey Air Pollution Control Act (N.J.S.
26:2C-1, et seq.); the Safe Drinking Water Act (33 U.S.C. 1251, et seq.); the
New Jersey Worker and Community Right to Know Act (N.J.S. 34:5A-1, et seq.); and
the New Jersey Toxic Catastrophe Prevention Act (N.J.S. 13:1-19, et seq.); and
the rules and regulations promulgated thereunder.
(e) Hazardous Substances: Any dangerous, toxic or hazardous
pollutant, contaminant, chemical, waste, material or substance as listed,
defined in or regulated under any Environmental Law, and also including, but not
limited to, urea-formaldehyde, polychlorinated biphenyls, asbestos or
asbestos-containing materials, nuclear or radioactive fuel or waste, explosives,
known carcinogens, petroleum and petroleum products and "Regulated Medical
Waste" as such term is defined at N.J.A.C. 7:26-3A.5. Notwithstanding the
foregoing, for purposes of this Article VIII, Hazardous Substances shall not
include de minimis quantities of janitorial and cleaning supplies or medical
supplies and equipment and by-product used in or resulting from the ordinary
course of Mortgagor's business in accordance with applicable law, including
Environmental Laws.
(f) Regulatory Actions: Any claim, demand, action, request for
information or proceeding brought, issued or instigated by any Governmental
Authority in connection with or under the authority of any Environmental Law,
including, without limitation, civil, criminal and/or administrative
proceedings, and whether or not directing or requiring any action or compelling
compliance with Environmental Laws or seeking costs, damages, penalties,
expenses or injunctive relief.
(g) Release: The spilling, leaking, disposing, discharging,
emitting, depositing, injecting, leaching, escaping, or threatened Release,
however defined, and whether intentional or unintentional, of any Hazardous
Substance.
(h) Third-Party Claims: Claims of third parties (other than
Regulatory Actions) alleging damages arising from personal injury, property
damage or damage to natural resources arising from or related in any way to
Environmental Conditions on, at, under, emanating from, relating to or
surrounding the Mortgaged Property.
Section 8.02. Representations and Warranties. Except as set
forth in Schedule 8.02 and except as disclosed in the Environmental Report, the
Mortgagor represents and warrants to the best of its knowledge as of the date
hereof that:
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(a) No part of the Mortgaged Property was ever used, nor is it
being used now, as a landfill, dump or other disposal, storage, or treatment
area for Hazardous Substances or as a gasoline service station or a facility
with its primary operations involving the selling, dispensing, storing,
transferring or handling of petroleum and/or petroleum products; and
(b) There are not now nor has there ever been located on the
Mortgaged Property or in the buildings at the Mortgaged Property any (i)
underground storage tanks, above ground storage tanks or any other vessels used
or intended for the treatment, storage or disposal of Hazardous Substances, or
(ii) urea-formaldehyde materials, asbestos, asbestos-containing materials,
polychlorinated biphenyls (PCBs) or nuclear fuels or wastes; and
(c) There has not been nor is there now occurring any Release
of any Hazardous Substance on, at, under or emanating from the Mortgaged
Property; and
(d) The Mortgagor's use, if any, and/or disposal, if any, of
Hazardous Substances on the Mortgaged Property and/or disposal elsewhere, if
any, of Hazardous Substances generated on or from the Mortgaged Property, has
been in material compliance with all applicable Environmental Laws; and
(e) The Mortgaged Property and the use and operation thereof
are currently, and at all times during the Mortgagor's occupancy, operation or
control of the Mortgaged Property have been, in material compliance with all
applicable Environmental Laws; and
(f) No Third-Party Claims and/or Regulatory Actions have been
asserted or assessed against the Mortgagor and/or the Mortgaged Property, and no
Third-Party Claims and/or Regulatory Actions are pending or, to the best of the
Mortgagor's knowledge, threatened against the Mortgagor and/or the Mortgaged
Property; and
(g) The Mortgaged Property is not listed in the United States
Environmental Protection Agency's National Priorities List of Hazardous Waste
Sites or the New Jersey Department of Environmental Protection's known
Contaminated Sites List, or any other similar list maintained by any federal,
state or local Governmental Authority with respect to sites from which there is
or has been a Release of any Hazardous Substance. The Mortgagor has not
transported or arranged for the transportation of any Hazardous Substances
generated from the Mortgaged Property to any location; and
(h) The Mortgagor has not received and is not in possession of
any Environmental Documents which have not been made available by Mortgagor to
the Mortgagee; and
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(i) The Mortgaged Property has not been nor is now being used
as a "Major Facility" as such term is defined in N.J.S. 58:10-23.11b. The
Mortgagor will not use the Mortgaged Property in the future as a "Major
Facility"; and
(j) There are no liens against the Mortgaged Property arising
under any Environmental Law or based upon a Regulatory Action and/or Third-Party
Claim; and further, no lien has been attached to any revenues or any real or
personal property owned by the Mortgagor including, but not limited to, the
Mortgaged Property, as a result of the Administrator of the New Jersey Spill
Compensation Fund expending monies from said fund pursuant to N.J.S.
58:10-23.11g, and/or to pay for "Cleanup and Removal Costs" as such term is
defined in N.J.S. 58:10-23.11b, arising from an intentional or unintentional
action or omission of the Mortgagor; and
Section 8.03. Covenants.
(a) The Mortgagor will not permit or conduct on the Mortgaged
Property the generation, treatment, manufacture, use, handling, storage or
disposal of any Hazardous Substance, except in compliance with all applicable
Environmental Laws. In addition, the Mortgagor will not permit the Mortgaged
Property to be used for any of the purposes set forth in Section 8.02(a) hereof.
(b) The Mortgagor will promptly notify the Mortgagee in
writing of any material existing, pending or threatened (i) investigation,
inquiry, claim, demand or action by any Governmental Authority in connection
with any Environmental Laws, (ii) Third-Party Claims, (iii) Regulatory Actions,
and/or (iv) Environmental Conditions at, on, under, emanating from, relating to
or surrounding the Mortgaged Property of which it has knowledge or notice.
(c) In the event that any Clean-Up of any Environmental
Conditions on, at, under, emanating from, relating to or surrounding the
Mortgaged Property is required to be undertaken by the Mortgagor by any
Governmental Authority or under any applicable Environmental Laws as a result of
or relating to any of the following, then the Mortgagor shall complete or cause
to be completed, at its own expense, such Clean-up: (i) any Release of any
Hazardous Substance on, at, under, emanating from, relating to or surrounding
the Mortgaged Property or the presence of any Hazardous Substance which has come
to be located on, at, under, relating to or surrounding the Mortgaged Property
from another location; (ii) any injury to human health or safety or the
environment by reason of the Environmental Condition of, or activities on or
under, the Mortgaged Property; or (iii) any violation, or alleged violation, of
any applicable Environmental Law.
(d) After the date of execution of this Mortgage, the
Mortgagor shall, upon request, make available to the Mortgagee, so long as the
Bonds are Outstanding (as defined in the Trust Indenture) and the Mortgagee has
any interest in the Mortgaged Property, complete copies of any and all
Environmental Documents.
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(e) The Mortgagor will keep the Mortgaged Property free of any
lien imposed pursuant to any Environmental Law. Without in any way limiting the
generality of the foregoing, in the event that there shall be filed a lien
against the Mortgaged Property by the New Jersey Department of Environmental
Protection, pursuant to and in accordance with the provisions of the Spill Act
(specifically, N.J.S. 58:10-23.11f(f)), as a result of the Administrator of the
New Jersey Spill Compensation Fund having expended monies from said fund
pursuant to N.J.S. 58:10-23.11g, or to pay for "Cleanup and Removal Costs," as
such term is defined in N.J.S. 58:10-23.11b, arising from an intentional or
unintentional action or omission of the Mortgagor, resulting in the Release of
"Hazardous Substances," as such term is defined in N.J.S. 58:10-23.11b, into
waters of the State of New Jersey or onto lands from which it might flow or
drain into said waters, then the Mortgagor shall, within sixty (60) days from
the date that the Mortgagor is given notice that the lien has been placed
against the Mortgaged Property (or within such shorter period of time in the
event that the State of New Jersey has commenced steps to cause the Mortgaged
Property to be sold pursuant to the lien), either (i) pay the claim and remove
the lien from the Mortgaged Property, or (ii) furnish to the Mortgagee either
(A) a bond satisfactory to the Mortgagee in the amount of the claim out of which
the lien arises, (B) a cash deposit in the amount of the claim out of which the
lien arises, or (C) other security reasonably satisfactory to the Mortgagee in
an amount sufficient to discharge the claim out of which the lien arises.
(f) In the event the Mortgagee at any time (even after the
occurrence of or during the continuance of any Event of Default under the
Agreement or this Mortgage) reasonably believes or has knowledge of any actual
or possible material violation of any Environmental Laws at the Mortgaged
Property or the presence or threatened presence of any Environmental Conditions
at, on, under, emanating from, relating to or surrounding the Mortgaged
Property, the Mortgagor shall upon the written request of the Mortgagee have an
environmental review or audit and report of the Mortgaged Property prepared for
the Mortgagee. The duty of the Mortgagor to provide an environmental review or
audit and report shall continue after the occurrence of and during the
continuance of any Event of Default under the terms of this Mortgage or the
Agreement.
(g) The Mortgagee may itself or by its employees, agents,
contractors or representatives enter upon the Mortgaged Property for the
purposes of conducting such soil, groundwater and chemical tests or other
investigations, examinations, or analyses (hereafter referred to as
"Investigation") as the Mortgagee may reasonably desire. The Mortgagee shall
provide the Mortgagor with reasonable notice before entering the Mortgaged
Property to conduct any such Investigation, and the Mortgagor shall cooperate
fully in such Investigation.
(h) The Mortgagee and its employees, agents, contractors,
consultants and/or representatives shall use reasonable efforts to conduct any
such Investigation in a manner which does not unreasonably interfere with the
Mortgagor's use of and operations
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on the Mortgaged Property, provided however that reasonable temporary
interference with such use and operations is permissible if the Investigation
cannot otherwise be reasonably and inexpensively conducted. In the event that
this Mortgage is foreclosed, the Mortgagor shall deliver the Mortgaged Property
to the Mortgagee free of all Hazardous Substances and in compliance with all
Environmental Laws.
(i) The Mortgagor shall use its best efforts to assure
compliance with all Environmental Laws by all lessees, tenants, subtenants,
occupants, licensees, operators and users of the Mortgaged Property.
Section 8.04. Indemnities.
(a) The Mortgagor agrees to, and does hereby, indemnify,
defend (with counsel reasonably acceptable to the Mortgagee) and hold harmless
the Mortgagee, the Bondholders, their directors, officers, employees and agents
(all being included in the word "Mortgagee" for the purposes of this Section
8.04(a)) from and against any and all claims, causes of action, damages,
demands, fines, liabilities, losses, penalties, settlements, expenses and/or
costs, however defined and of whatever kind or nature, known or unknown,
(including, but not limited to, reasonable attorneys', consultants' and
engineering fees and disbursements and sampling, monitoring or remediation
costs, costs to effect compliance with Environmental Laws, costs of defense and
interest) ("Losses") which may be asserted against, imposed upon, suffered or
incurred by, the Mortgagee, arising out of or in any way related to or due to
(i) the Release of any Hazardous Substances at the Mortgaged Property or any
Environmental Conditions on, at, under, emanating from, relating to or
surrounding the Mortgaged Property, (ii) any injury to human health, safety or
the environment (including wrongful death, personal injury, property damage or
damage to natural resources) by reason of Environmental Conditions, or
activities past or present, on, at, under, emanating from, relating to or
surrounding the Mortgaged Property; (iii) any violation, or alleged violation,
of any Environmental Law; (iv) any material misrepresentation by the Mortgagor
which relates to Environmental Conditions in this Mortgage and/or the Agreement
or in any other documents or materials furnished by the Mortgagor to the
Mortgagee and/or its representatives in connection with the issuance of the
Bonds; (v) any breach of any representation or warranty set forth in Section
8.02 hereof; (vi) any breach of, or other failure to comply with, or any default
after expiration of applicable grace and cure periods under, any provision of
Section 8.03 of this Mortgage; (vii) any Regulatory Action or Third-Party Claim
arising from or relating to any Release or any Environmental Conditions on, at,
under, emanating from, relating to or surrounding the Mortgaged Property, except
to the extent such Regulatory Action or Third-Party Claim arises from or relates
to the negligent acts or omissions of the Mortgagee (including its agents) or
its successors or assigns including any transferee of the title of the Mortgagee
or any subsequent purchaser at a foreclosure; or (viii) any lien imposed upon
the Mortgaged Property in favor of any Governmental Authority as a result of the
presence, disposal or Release of Hazardous Substances or any other Environmental
Conditions on, at, under, emanating from, relating to or surrounding the
Mortgaged Property. The duty of the Mortgagor to indemnify, defend, and hold
harmless
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the Mortgagee includes, but is not limited to, proceedings or actions commenced
by any person (including, but not limited to, any Governmental Authority or
entity) before any court or administrative agency. The Mortgagee also shall have
the right to join and participate in, if it so elects, any legal proceedings or
actions initiated in connection with any Losses and to have its reasonable
attorneys' fees and expenses in connection therewith paid by the Mortgagor.
(b) If the Mortgagor fails to initiate and diligently pursue
to completion any Clean-Up required at or with respect to the Mortgaged Property
by any Governmental Authority or under any applicable Environmental Laws and
such failure continues for thirty (30) days after the Mortgagee provides the
Mortgagor written notice thereof (provided however, that if such Clean-Up
requires work to be done, actions to be taken or conditions to be remedied which
by their nature cannot be fully done, taken or remedied, as the case may be,
within such thirty (30) day period, then no such failure shall be deemed to have
occurred with respect to any such work, actions or remediation so long as the
Mortgagor commences performance of any such work, actions or remediation within
such thirty (30) day period and thereafter diligently and continuously
prosecutes same to completion), the Mortgagee may, in its sole discretion, (i)
upon prior written notice to the Mortgagor, cause the Clean-Up of any Hazardous
Substance or other Environmental Conditions on, at, under, emanating from,
relating to or surrounding the Mortgaged Property; (ii) pay on behalf of the
Mortgagor any Losses imposed on the Mortgagor as a result of any Regulatory
Actions; (iii) make any other payment or perform any other reasonable act which
will prevent a Lien in favor of any Governmental Authority from attaching to the
Mortgaged Property; or (iv) pay, on behalf of the Mortgagor, any Losses imposed
on the Mortgagor as a result of any Third-Party Claims or any one or more of the
foregoing. The costs of such Clean-Up and/or exercise of the remedies
hereinabove set forth by the Mortgagee shall be added to the indebtedness under
the Agreement (whether or not any court or Governmental Authority has ordered
the Clean-Up) and said costs shall become due and payable, with interest
thereon, at the Default Rate. After the occurrence of an Event of Default
hereunder, the Mortgagor shall give the Mortgagee and its employees, agents,
contractors and representatives, access to the Mortgaged Property to conduct any
Clean-Up that the Mortgagee, in its sole discretion, deems appropriate; however,
the Mortgagee has no affirmative obligation to conduct any such Clean-Up, and
this Mortgage and the Agreement shall not be construed as creating any such
obligation or any liability on the part of the Mortgagee.
(c) Any partial exercise by the Mortgagee of the remedies set
forth in Section 8.04(b) hereof, or any partial undertaking on the part of the
Mortgagee to cure the failure of the Mortgagor to comply with any Environmental
Laws, shall not obligate the Mortgagee to complete the actions taken or require
the Mortgagee to expend further sums to cure such noncompliance; nor shall the
exercise of any such remedies operate to place upon the Mortgagee any
responsibility for the operation, control, care, management or repair of the
Mortgaged Property or make the Mortgagee, or be construed to deem the Mortgagee
to be, an "owner" or "operator" of the Mortgaged Property within the meaning of
or under any Environmental Laws. The Mortgagee, by making any such
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payment or incurring any such costs, shall be subrogated to any rights of the
Mortgagor to seek reimbursement from any third parties including, without
limitation, a predecessor-in-interest to the Mortgagor's title to the Mortgaged
Property, who may be a "responsible party" or otherwise liable for any or all of
such payments or costs under any Environmental Laws, common law, equity or
contract.
Section 8.05. General.
(a) The representations, warranties, covenants and indemnities
contained in this Article VIII shall continue after and survive the execution
and delivery of this Mortgage, the discharge of the Bonds, the discharge of this
Mortgage, the payment in full of the Bonds and any foreclosure of this Mortgage
and any acquisition of title to the Mortgaged Property by the Mortgagee and they
shall be deemed continuing representations, warranties and indemnities for the
benefit of the Mortgagee and any successors and assigns of the Mortgagee,
including any transferee of the title of the Mortgagee or any subsequent
purchaser at a foreclosure sale, and any subsequent owner of the Mortgaged
Property claiming through or under the title of the Mortgagee.
(b) The representations and warranties of the Mortgagor in
this Article VIII are based on its investigations of the Mortgaged Property, and
the Mortgagee is entitled to rely thereon notwithstanding any independent
investigations by the Mortgagee or its employees, agents, contractors or
representatives.
(c) The Mortgagor and its successors and assigns, hereby
forfeit and forever waive, release and agree not to make any claim or bring any
cost recovery action against the Mortgagee arising out of any of the matters
described in Section 8.04 hereof under CERCLA, or any equivalent State of New
Jersey or local law, or any other Environmental Laws, except to the extent such
claim or action arises or results from the acts or omissions of the Mortgagee or
its successors or assigns after any foreclosure pursuant to the terms hereof. It
is expressly understood and agreed that to the extent that the Mortgagee is
strictly liable under any such law, statute, code, ordinance, regulation, rule
or other requirement, the indemnification obligation of the Mortgagor to the
Mortgagee under this Article VIII shall likewise be without regard to fault on
the part of the Mortgagor with respect to any violation or condition which
results in any liability to the Mortgagee.
(d) The Mortgagee's rights and remedies against the Mortgagor
under this Article VIII shall be in addition to and not in lieu of all other
rights and remedies of the Mortgagee under this Mortgage, the Agreement and the
other Loan Documents, at law or in equity.
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ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.01. Construction Mortgage. This Mortgage secures
future advances to be used in part for construction of any Capital Additions.
Accordingly, this Mortgage constitutes a "construction mortgage" as defined in
N.J.S.A 12A:9-313(1)(c).
Section 9.02. No Obligation of the Mortgagee. Neither the
acceptance by the Mortgagee of the assignment granted in Section 7.01 hereof, or
the security interest granted in Section 6.01 hereof, nor the granting of any
other right, power, privilege or authority in this Mortgage, nor the exercise of
any of the aforesaid, shall:
(a) prior to the taking of possession of the Mortgaged
Property by the Mortgagee be deemed to constitute the Mortgagee as a "Mortgagee
in Possession"; or
(b) at any time thereafter, obligate the Mortgagee:
(i) to appear and defend any action or proceeding
relating to the Mortgaged Property;
(ii) to take any action hereunder;
(iii) to expend any money or incur any expenses to
perform or discharge any obligation, duty or liability with
respect to any lease or agreement or with respect to the
Personalty, Fixtures, Rents or any other portion of the
Mortgaged Property;
(iv) to assume any obligation or responsibility for
any deposits which are not physically delivered to the
Mortgagee; or
(v) for any injury or damage to any person or
property sustained in or about the Mortgaged Property.
Section 9.03. Mortgagor's Attorney-in-Fact. The Mortgagor will
pay all costs of filing any financing, continuation or termination statements
with respect to the security interests created by this Mortgage and shall make,
execute and deliver or cause to be made, executed or delivered to the Mortgagee,
any further instruments, mortgages, conveyances, deeds, certificates and other
documents as may, in the opinion of the Mortgagee, be reasonably necessary or
desirable in order to effectuate, complete, confirm, or perfect or to continue
to preserve the Lien of this Mortgage; and the Mortgagee is hereby appointed as
the Mortgagor's attorney-in-fact to do, at the Mortgagee's option and at the
Mortgagor's expense, all acts and things which the Mortgagee may deem necessary
to perfect and continue to perfect the Lien and security interests created by
this Mortgage and to protect the Mortgaged Property. The Mortgagee may execute,
sign, endorse, transfer or deliver, in the name of the Mortgagor, notes, checks,
drafts or other instruments for the
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payment of money and receipts, certificates of origin, certificates of title,
applications for certificates of title, or any other documents necessary to
evidence, perfect or realize upon the Liens and security interests created or
secured by this Mortgage. This authority shall be considered a power coupled
with an interest and shall be irrevocable until all the amounts due under the
Agreement secured hereby shall have been paid in full.
Section 9.04. Damage, Destruction, Condemnation and Eminent
Domain. Should the Mortgaged Property or any part thereof, including any
easements or appurtenances thereof, be taken, destroyed or damaged, permanently
or temporarily, by reason of any public improvement or the exercise of the power
of eminent domain or purchase under threat of condemnation proceedings for the
public use of the Mortgaged Property or any part thereof, including any sale or
proceeding in lieu of condemnation, or fire or any other cause, all Proceeds of
any such damage, destruction, condemnation or taking shall be applied as
provided in the Agreement. The Mortgagor further agrees to give the Mortgagee
immediate notice of the actual or, to its knowledge, threatened commencement of
any such proceedings under condemnation or eminent domain and will deliver to
the Mortgagee copies of any and all papers served in connection therewith. The
Mortgagor agrees to execute such further assignments of any Proceeds, rights of
action and proceedings as the Mortgagee may request. Notwithstanding any taking
by eminent domain, alteration of the grade of any street or other injury to or
decrease in value of the Mortgaged Property, the Mortgagor shall continue to pay
the amounts due under the Agreement until any such Proceeds shall have been
actually received by the Mortgagee and any reduction in the amounts due under
the Agreement resulting from the application by the Mortgagee shall be deemed to
take effect only on the date of such receipt.
Section 9.05. No Waiver by the Mortgagee. By accepting payment
of any sum secured hereby after its due date, the Mortgagee does not waive any
late charge thereon not then paid or its right either to require prompt payment
when due of all other sums so secured or to declare a default for the
Mortgagor's failure to pay when any amount is due.
Section 9.06. Satisfaction.
(a) Except for the provisions which by their express terms
survive termination of this Mortgage, this Mortgage and the Lien and security
interests created hereby shall be null and void and extinguished, and the
Mortgagee shall execute and record a satisfaction of this Mortgage and the
Mortgagor shall be released from the covenants, agreements and obligations of
the Mortgagor contained herein upon the payment and performance of all amounts
due under the Agreement secured hereby.
(b) The recitals in such satisfaction of any matters or facts
shall be conclusive proof against all Persons of the truthfulness thereof. The
execution and recordation of a satisfaction of this Mortgage by the Mortgagee
shall be sufficient to extinguish all interests of the Mortgagee and its legal
representatives, successors and assigns.
Section 9.07. Notices. All communications under or in
connection with this Mortgage shall be in writing and shall be mailed by
certified mail, return receipt requested or by
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overnight express mail with notice for receipt, or otherwise sent by telex,
telegram, telecopy or similar form of rapid transmission, or by telephone
confirmed by mailing (in the manner stated above) of written confirmation at
substantially the same time as such rapid transmission, or personally delivered
to an office of the receiving party. All such communications shall be mailed,
sent or given to the following addresses:
If to the Mortgagor, to:
Able Laboratories, Inc.
▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
If to the Mortgagee:
New Jersey Economic Development Authority
▇.▇. ▇▇▇ ▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Managing Director of Investment Banking
Section 9.08. Amendment and Waiver. No amendment or waiver of
any provision of this Mortgage nor consent to any departure by the Mortgagor
therefrom shall in any event be effective unless the same shall be in writing
and signed by the Mortgagee and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
Section 9.09. Payment of Costs and Expenses of Mortgagee. The
Mortgagor shall promptly pay upon demand all reasonable expenses and costs
incurred by the Mortgagee, including reasonable attorneys' fees and expenses in
connection with (a) any action, proceeding, litigation or claim instituted or
asserted by or against the Mortgagee or in which the Mortgagee becomes engaged,
wherein it becomes necessary in the opinion of the Mortgagee to defend or uphold
the Lien of this Mortgage, or the validity or effectiveness of any assignment or
any claim, award, payment, property damage insurance policy or any other right
or property conveyed, encumbered or assigned by the Mortgagor to the Mortgagee
hereunder, or the priority of any of the same, and (b) the exercise or
enforcement of any other rights or remedies of the Mortgagee hereunder, and in
any case, all such expenses and costs may be added to and become part of the
principal indebtedness of the Mortgagor hereunder, bear interest at the Default
Rate, and be secured in all respects hereby as if part of the principal
indebtedness of the Mortgagor hereunder and under the Agreement.
Section 9.10. Taxation of the Amounts Due Under Agreement and
Mortgage. If at any time before the amounts due under the Agreement hereby
secured are fully paid, any law of the State of New Jersey be enacted deducting
from the value of the Mortgaged Property for the purposes of taxation the amount
of any Lien thereon, or imposing upon the Mortgagee the payment of the whole or
any part of the Impositions herein required to be paid by the Mortgagor or
revising
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or changing in any way the laws relating to the taxation of mortgages or debts
secured by mortgages or the Mortgagee's interest in the Mortgaged Property or
the manner of collection of taxes, so as to affect adversely this Mortgage or
the debt hereby secured, or the owner and holder thereof in respect thereto,
then, and in any such event, the Mortgagor upon demand by the Mortgagee, shall
pay such Impositions or reimburse the Mortgagee therefor; provided, however,
that if, in the written opinion of counsel for the Mortgagee, (a) it would be
unlawful to require the Mortgagor to make such payment; or (b) the making of
such payment might result in the imposition of interest beyond the Highest
Lawful Rate, then, in such event, the Mortgagee may elect, by notice in writing
given to the Mortgagor, to declare all of the amounts due under the Agreement
secured hereby to be and become due and payable within sixty (60) days from the
giving of such notice. Notwithstanding the foregoing, it is understood and
agreed that the Mortgagor is not obligated to pay any portion of the Mortgagee's
federal or State income taxes.
Section 9.11. No Credit for Taxes. The Mortgagor will not
claim or demand or be entitled to receive any credit or credits on the amounts
due under the Agreement for so much of the taxes assessed against said Mortgaged
Property as is equal to the tax rate applied to the amounts due under the
Agreement due on this Mortgage or any part thereof, and no deduction shall be
claimed from the taxable value of said Mortgaged Property by reason of this
Mortgage.
Section 9.12. Due on Sale; Assignability. The Mortgagor
acknowledges that the transfer of the Mortgaged Property could significantly and
materially alter, impair and reduce the Mortgagee's security for the unpaid
amounts due under the Agreement. The Mortgagor agrees, except as permitted in
the Agreement, not to, directly or indirectly, transfer the Mortgaged Property,
or any portion thereof, or any interest therein, without the prior written
consent of the Mortgagee. In the event the Mortgagor, or any successor in
interest of the Mortgagor, shall transfer the Mortgaged Property, or any portion
thereof, or any interest therein, to any Person without complying with the terms
of the Agreement, all unpaid amounts due under the Agreement, the payment of
which is secured by this Mortgage shall at the option of the Mortgagee and
without notice or demand, become immediately due and payable, and, in addition,
upon any such prohibited transfer, such transfer shall be deemed to be an "Event
of Default" hereunder. Consent to one such transaction shall not be deemed to be
a waiver of the right to require consent to future or successive transactions.
As used herein, "transfer" includes the sale, transfer or conveyance of the
Mortgaged Property, or any portion thereof, or any interest therein, whether
voluntary, involuntary (except by eminent domain), by operation of law or
otherwise or the sale or transfer of any legal or beneficial interest in the
Mortgagor. The Mortgagee shall have the right to assign this Mortgage to the
Trustee as provided in Section 2.02 hereof. All of the rights, privileges,
remedies and options given to the Mortgagee hereunder shall inure to the benefit
of its successors and assigns; and all the terms, conditions, promises,
covenants, provisions and warranties of this Mortgage shall inure to the benefit
of and shall bind the representatives, successors and assigns of the Mortgagee
and the Mortgagor.
Section 9.13. Severability. Any provision of this Mortgage
which is prohibited, unenforceable or not authorized in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition,
unenforceability or nonauthorization without invalidating the
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remaining provisions hereof or affecting the validity, enforceability or
legality of such provision in any other jurisdiction.
Section 9.14. Governing Law. This Mortgage shall be governed
by and construed in accordance with the laws of the State of New Jersey without
giving effect to conflicts of laws.
Section 9.15. Future Advances. This Mortgage shall secure the
amounts due under the Agreement and any future or protective advances made
hereunder or under the Agreement.
Section 9.16. Headings. Section headings in this Mortgage are
included herein for convenience of reference only and shall not constitute a
part of this Mortgage for any other purpose.
Section 9.17. Entire Agreement. This Mortgage constitutes the
entire agreement between the parties hereto with respect to the transactions
contemplated hereby and supersedes and is full substitution for any and all
prior agreements and understandings between said parties related to such
transactions.
Section 9.18. Time of the Essence. Time is strictly of the
essence under this Mortgage and any amendment, modification or revision hereof.
Section 9.19. Further Action By Mortgagor. The Mortgagor shall
at its expense promptly upon request of the Mortgagee do all acts and things,
including, but not limited to, the execution of any further assurances deemed
necessary by the Mortgagee, to establish, confirm, maintain, protect and
continue the Lien created and intended to be created hereby, all assignments
made or intended to be made pursuant hereto and all other rights and benefits
conferred or intended to be conferred on the Mortgagee hereby, and the Mortgagor
shall pay all reasonable costs incurred by the Mortgagee in connection
therewith, including all filing and recording costs, cost of searches, and
reasonable attorneys' fees incurred by the Mortgagee.
Section 9.20. Advances by Mortgagee. The Mortgagee may, but is
not obligated to, pay any sum or perform any other obligation for the account of
the Mortgagor which the Mortgagor has failed to pay or perform (including, but
not limited to, procuring insurance), and sums so spent by the Mortgagee shall
be added to the principal sum secured by this Mortgage and be repayable by the
Mortgagor on demand, and shall bear interest from the date of advance by the
Mortgagee equal to the Default Rate.
Section 9.21. Invalid Provision Disregarded. If any term or
provision of this Mortgage or the application thereof to any Person or
circumstance shall to any extent be invalid or unenforceable, the remainder of
this Mortgage or the application of such term or provision to Persons or
circumstances other than those as to which it is held invalid or unenforceable,
shall not be affected thereby and each term and provision of this Mortgage shall
be valid and be enforced to the fullest extent permitted by law.
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Section 9.22. Inspection and Repairs by the Mortgagee. The
Mortgagor will permit the Mortgagee and the Mortgagee's representatives to enter
the Mortgaged Property at reasonable times upon prior written notice to inspect
the same; provided that the Mortgagee shall not be obligated to do so, either
directly or through its representatives. Such right of access shall include,
without limitation, the right to enter upon the Mortgaged Property to conduct
such tests, analyses, environmental audits, inspections and borings as the
Mortgagee may deem necessary or advisable, in its reasonable discretion. In case
of any breach or default by the Mortgagor in its maintenance and repair
obligations with respect to the Mortgaged Property under the Agreement, the
Mortgagee may, at its option, enter the Mortgaged Property to protect, restore
or repair any part thereof, but the Mortgagee shall be under no obligation to do
so.
Section 9.23. Assignment. The Mortgagor agrees that this
Mortgage will be assigned by the Mortgagee to the Trustee as provided in Section
2.02 hereof, subject to the reservation of certain rights by the Mortgagee; and
may be further assigned to any successor Trustee as provided in the Indenture.
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IN WITNESS WHEREOF, this First Leasehold Mortgage, Security
Agreement, Assignment of Rents and Financing Statement has been duly executed as
of the day and year first above written.
[SEAL]
ATTEST: ABLE LABORATORIES, INC.
By: ___________________ By:________________________________
-▇▇-
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ )
) ss:
COUNTY OF ESSEX )
BE IT REMEMBERED that on this _____ day of _______, 1999, before me,
the subscriber, personally appeared _____________, the _________ of ABLE
LABORATORIES, INC., a corporation duly organized and validly existing under the
laws of the State of New Jersey, who, I am satisfied, is the person who has
signed the within instrument, and I having first made known to him the contents
thereof he thereupon acknowledged that he signed, sealed with the corporate seal
and delivered the said instrument in his capacity as an officer of such
corporation, and that the within instrument is the voluntary act and deed of
said corporation, made by virtue of authority from its Board of Directors.
____________________________
(NOTARIAL SEAL)
SCHEDULE 8.02
S-1
EXHIBIT A
[Property Description]
A-1